SEC Filing | Brandywine Realty Trust

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Prepared and filed by St Ives Burrups

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

(Mark One)

Annual report pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934

For the fiscal year ended December 31, 2003 or

Transition report pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934

For the transition period from to

Commission File Number 1-9106

BRANDYWINE REALTY TRUST
(Exact name of registrant as specified in its charter)

Maryland

23-2413352

(State or other jurisdiction of
Incorporation or organization)

(I.R.S. Employer
Identification No.)

401 Plymouth Road, Plymouth Meeting, Pennsylvania

19462

(Address of principal executive offices)

(Zip Code)

(610) 325-5600

Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Name of each exchange on which registered

Common Shares of Beneficial Interest,
(par value $0.01 per share)
7.50% Series C Cumulative
Redeemable Preferred Shares of
Beneficial Interest
(par value $0.01 per share)
7.375% Series D Cumulative
Redeemable Preferred Shares of
Beneficial Interest
(par value $0.01 per share)

New York Stock Exchange

New York Stock Exchange

New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: none

(Title of class)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act). Yes No

The aggregate market value of the Common Shares of Beneficial Interest held by non-affiliates of the registrant as of the last day of the registrant’s most recently completed second fiscal quarter was $903.3 million. The aggregate market value has been computed by reference to the closing price of the Common Shares of Beneficial Interest on the New York Stock Exchange on such date. An aggregate of 45,663,743 Common Shares of Beneficial Interest were outstanding as of March 11, 2004.

DOCUMENTS INCORPORATED BY REFERENCE:

Portions of the proxy statement for the Annual Meeting of Shareholders of Brandywine Realty Trust to be held May 3, 2004 are incorporated by reference into Part III of this Form 10-K.

TABLE OF CONTENTS

FORM 10-K

Page

Item 1. Business 5

Item 2. Properties 18

Item 3. Legal Proceedings 28

Item 4. Submission of Matters to a Vote of Security Holders 29

Item 5. Market for Registrant’s Common Equity and Related Shareholder Matters and Issuer Purchases of Equity Securities 29

Item 6. Selected Financial Data 31

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 31

Item 7A. Quantitative and Qualitative Disclosure About Market Risk 44

Item 8. Financial Statements and Supplementary Data 44

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 44

Item 9A. Controls and Procedures 45

Item 10. Trustees and Executive Officers of the Registrant 46

Item 11. Executive Compensation 46

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters 46

Item 13. Certain Relationships and Related Transactions 46

Item 14. Principal Accountant Fees and Services 46

Item 15. Exhibits, Financial Statements, Schedules and Reports on Form 8-K 47

SIGNATURES 52

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PART I

Item 1. Business

General

As used herein, the terms “we,” “us,” “our” or the “Company” refer to Brandywine Realty Trust, a Maryland real estate investment trust, individually or together with its subsidiaries, including Brandywine Operating Partnership, L.P. (the “Operating Partnership”), a Delaware limited partnership. We are a self-administered and self-managed real estate investment trust (“REIT”) active in acquiring, developing, redeveloping, leasing and managing office and industrial properties. As of December 31, 2003, we owned 208 office properties, 25 industrial facilities and one mixed-use property (the “Properties”) containing an aggregate of approximately 15.7 million net rentable square feet. We were also performing management and leasing services for 41 properties containing an aggregate of 3.6 million net rentable square feet. In addition, as of December 31, 2003, we held economic interests in ten unconsolidated real estate ventures (the “Real Estate Ventures”) that we formed with third parties to develop or own commercial properties. The Real Estate Ventures own ten office buildings that contain approximately 1.8 million net rentable square feet. As of December 31, 2003, we had an aggregate investment in the Real Estate Ventures of approximately $15.9 million (net of returns of invested amounts). We also own approximately 445 acres of undeveloped land and hold options to purchase approximately 61 additional acres. The Properties are located in the office and industrial markets in and surrounding Philadelphia, Pennsylvania, New Jersey and Richmond, Virginia.

Recent Developments

On January 12, 2004, we sold 2,645,000 Common Shares for net proceeds of approximately $69.3 million. We used the net proceeds to reduce the outstanding balance under our revolving credit facility.

On February 3, 2004, we entered into an agreement with Commonwealth Atlantic Operating Properties, Inc., the holder of 1,950,000 then outstanding Series B Preferred Units (the “Series B Preferred Units”) in the Operating Partnership. The Series B Preferred Units had an aggregate stated value of $97.5 million and accrued distributions at 7.25% per annum. During February 2004, we redeemed all of the Series B Preferred Units for an aggregate price of $93.0 million, together with accrued but unpaid distributions from January 1, 2004.

On February 27, 2004, we sold 2,300,000 7.375% Series D Cumulative Redeemable Preferred Shares for net proceeds of approximately $55.5 million. We used the net proceeds to reduce the outstanding balance under our revolving credit facility, including amounts advanced under our revolving credit facility to fund the redemption of Series B Preferred Units.

On March 3, 2004, we sold 1,840,000 Common Shares for net proceeds of approximately $50.7 million. We used the net proceeds to reduce the outstanding balance under our revolving credit facility.

Business Objective

Our business objective is to maximize return on investment and to accomplish our objective we seek to:

	•	maximize cash flow through leasing strategies designed to capture potential rental growth as rental rates increase and as below-market leases are renewed;


	•	attain a high tenant retention rate through aggressive tenant service programs responsive to the varying needs of our diverse tenant base;


	•	increase economic diversification while maximizing economies of scale;

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	•	develop high-quality office and industrial properties on our existing inventory of land, as warranted by market conditions;


	•	capitalize on our redevelopment expertise to selectively acquire, redevelop and reposition underperforming properties in desirable locations;


	•	acquire high-quality office and industrial properties and portfolios of such properties at attractive yields in selected submarkets within the Mid-Atlantic region that we expect will experience economic growth and provide barriers to entry; and


	•	pursue joint venture opportunities with high-quality partners having attractive real estate holdings or significant financial resources.

We expect to continue to concentrate our real estate activities in submarkets within the Mid-Atlantic region where we believe that: (i) barriers to entry (such as zoning restrictions, utility availability, infrastructure limitations, development moratoriums and limited developable land) will create supply constraints on office and industrial space; (ii) current market rents and absorption statistics justify limited new construction activity; (iii) we can maximize market penetration by accumulating a critical mass of properties and thereby enhance operating efficiencies; and (iv) there is potential for economic growth.

Organization

Brandywine Realty Trust was organized and commenced its operations in 1986 as a Maryland REIT. We own our assets and conduct our operations through the Operating Partnership and subsidiaries of the Operating Partnership. As of December 31, 2003, our ownership interest in the Operating Partnership entitled us to approximately 95.8% of the Operating Partnership’s distributions after distributions by the Operating Partnership to holders of its then outstanding Series B Preferred Units. Our structure as an “UPREIT” is designed, in part, to permit persons contributing properties to us to defer some or all of the tax liability they might otherwise incur in a sale of properties. We conduct our real estate management services through Brandywine Realty Services Corporation (the “Management Company”), a subsidiary of which 95% is owned by the Operating Partnership. The remaining five percent is owed by a partnership comprised of two executives of the Company. See “Management Activities.”

Our executive offices are located at 401 Plymouth Road, Suite 500, Plymouth Meeting, Pennsylvania 19462 and our telephone number is (610) 325-5600. We have an internet website at www.brandywinerealty.com. We also have regional offices in Mount Laurel, New Jersey and Richmond, Virginia.

Credit Facility

We maintain an unsecured credit facility (the “Credit Facility”) with a bank group (comprising 21 banks) led by Bank of America, N.A. A majority of our direct and indirect subsidiaries are parties to the Credit Facility, as guarantors. The Credit Facility provides up to $500 million in credit availability for working capital advances and letters of credit. As of December 31, 2003, there was unused availability of $184.3 million under the Credit Facility. The Credit Facility is scheduled to mature in June 2004, but may be extended at our election for a period of one year upon payment of a fee equal to .25% of the amount of the Credit Facility at the time of extension.

Advances under the Credit Facility currently bear interest at the London Inter-Bank Offered Rate (“LIBOR”) (1.12% at December 31, 2003) plus 1.50%. The spread over LIBOR varies, based on our leverage, from a low of 1.25% to a high of 1.75%. We have the option to elect an interest rate equal to the higher of the Federal Funds rate plus .75% or Bank of America’s prime rate plus .25%. We generally elect the interest rate based on LIBOR for all or most of our borrowings under the Credit Facility. An alternative rate and pricing structure are set forth in the Credit Facility if we obtain an investment grade debt rating, from at least two of the three major rating agencies.

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We have entered into interest rate swap and rate cap agreements designed to reduce the impact of interest rate changes on certain variable rate debt. At December 31, 2003, we had interest rate swap agreements for notional principal amounts aggregating $175 million. The swap agreements effectively fix the LIBOR portion of our interest rate on $100 million of Credit Facility borrowings at 4.230% and $75 million of Credit Facility borrowings at 4.215%, in each case until June 2004. The interest rate cap agreement effectively limits the interest rate on a mortgage with a notional value of $28 million at 8.7% until July 2004.

The Credit Facility contains provisions limiting: the incurrence of additional debt; the granting of liens; the consummation of mergers and consolidations; the disposition of assets and interests in subsidiaries; the making of loans and investments; and the payment of dividends. The restriction on dividends permits us to pay dividends in the amount required for us to retain our qualification as a REIT under the Internal Revenue Code of 1986, and otherwise limits dividends to 90% of our funds from operations, as defined in the Credit Facility.

The Credit Facility also contains financial covenants that require us to maintain a debt service coverage ratio, an interest coverage ratio, a fixed charge coverage ratio, an unsecured debt ratio and an unencumbered cash flow ratio above certain specified minimum levels; to maintain net worth above an amount determined on a specified formula; and to maintain a leverage ratio and a secured debt ratio below certain maximum levels. Another financial covenant limits the percentage of our total assets (on a consolidated basis) that can be held by subsidiaries not party to the Credit Facility.

Term Loan

We entered into a $100 million unsecured term loan (the “Term Loan”) in July 2002. We used the proceeds of the Term Loan to repay existing indebtedness, consisting primarily of indebtedness that had been outstanding under the Credit Facility. The Term Loan, like the Credit Facility, is recourse to us, including those of our subsidiaries that are parties, as guarantors, to the Term Loan agreement (which are the same subsidiaries that are guarantors of the Credit Facility). Bank of America, N.A. serves as administrative agent for a group of lenders under the Term Loan, as it does for the lenders under the Credit Facility, although the groups of lenders are not identical under the Term Loan and Credit Facility.

There is no required principal amortization of the Term Loan prior to maturity. The Term Loan matures on July 15, 2005, subject to two extensions of one year each upon payment by us of an extension fee and the absence of any defaults at the time of each extension.

The Term Loan bears interest at a per annum floating rate equal to the one, two, three or six month LIBOR, plus between 1.05% and 1.90% (1.12% at December 31, 2003), depending on our the leverage and debt rating. At our option, the Term Loan may bear interest at the prime rate plus .25%. Interest is due at the end of the LIBOR term, unless a six month LIBOR term is selected, in which case interest is also paid at the end of the third month of the LIBOR term. If we elect interest based on the prime rate, then interest payments will be due monthly.

The Term Loan agreement contains financial and operating covenants identical to those in the Credit Facility agreement. In addition, the Term Loan agreement, like the Credit Facility agreement, requires payment of prepayment premiums in certain instances.

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Additional Debt

Mortgage Indebtedness. The following table sets forth information regarding our mortgage indebtedness outstanding at December 31, 2003:

						Annual Debt
		Principal	Interest			Service
		Balance	Rate			(in 000’s)	Maturity
Property/Location		(in 000’s)	(a)			(a) (b)	Date

630 Allendale Road (c)	$	19,797	2.62	%	$	529	Mar-04
400 Berwyn Park (c)		15,726	2.72	%		431	Jul-04
1000 Howard Boulevard		3,647	9.25	%		803	Nov-04
Croton Road		6,209	7.81	%		590	Jan-06
111 Arrandale Blvd.		1,152	8.65	%		150	Aug-06
429 Creamery Way		3,235	8.30	%		410	Sep-06
Interstate Center (a)		1,131	3.00	%		204	Mar-07
440 & 442 Creamery		5,862	8.55	%		631	Jul-07
Norriton Office Center		5,342	8.50	%		524	Oct-07
481 John Young Way		2,475	8.40	%		261	Nov-07
400 Commerce Drive		12,346	7.12	%		1,059	Jun-08
200 Commerce Drive		6,165	7.12	%		556	Jan-10
Plymouth Meeting Executive Campus		48,299	7.00	%		4,142	Dec-10
Arboretum I, II, III & V		24,109	7.59	%		2,235	Jul-11
993, 997 and 2000 Lenox Drive, 2000, 4000, 9000 Midlantic Drive and 1 Righter Parkway		65,993	8.05	%		6,325	Oct-11
Newtown Square, Berwyn, Libertyview		66,000	7.25	%		5,333	May-13
Southpoint III		6,257	7.75	%		887	Apr-14
Grande B (30 properties)		81,704	7.48	%		7,444	Jul-27
Grande A (23 properties)
Tranche 1		63,526	7.48	%		6,086	Jul-27
Tranche 2 (a)		20,000	1.88	%		384	Jul-27
Tranche 3 (a)		3,684	2.05	%		77	Jul-27

Total mortgage indebtedness	$	462,659			$	39,061

(a)	For loans that bear interest at a variable rate, the rates in effect at December 31, 2003 have been assumed to remain constant.
(b)	“Annual Debt Service” is calculated by annualizing the regularly scheduled principal and interest amortization.
(c)	“Annual Debt Service” for construction loans that require payment of interest only is calculated by annualizing the interest payment based on the outstanding debt balances and rates in effect at December 31, 2003.

Guaranties. As of December 31, 2003, we had guaranteed repayment of approximately $17.4 million of loans on behalf of the Real Estate Ventures, including a $16.2 million guaranty that terminated in January 2004. See Item 2. Properties – Real Estate Ventures. We also provide customary environmental indemnities in connection with construction and permanent financing both for our own account and on behalf of Real Estate Ventures.

Management Activities

We conduct our third-party real estate management services business through the Management Company, a taxable REIT subsidiary. As of December 31, 2003, the Management Company was managing properties containing an aggregate of approximately 19.3 million net rentable square feet, of which approximately 15.7 million net rentable square feet related to Properties owned by us and approximately 3.6 million net rentable square feet related to properties owned by third parties.

Geographic Segments

We currently manage our portfolio of Properties within three segments: (1) Pennsylvania, (2) New Jersey and (3) Virginia. (See Note 12 to the Financial Statements.)

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Competition

The leasing of real estate is highly competitive. The Properties compete for tenants with similar properties primarily on the basis of location, total occupancy costs (including base rent and operating expenses), services provided, and the design and condition of the improvements. We also face competition when attempting to acquire real estate, including competition from domestic and foreign financial institutions, other REIT’s, life insurance companies, pension funds, partnerships and individual investors.

Employees

As of December 31, 2003, we had 237 full-time employees.

Environmental Regulations

As an owner and operator of real estate, we are subject to various environmental laws of federal, state and local governments. Compliance with existing laws has not had a material adverse effect on our financial condition and results of operations, and management does not believe it will have such an impact in the future. However, we cannot predict the impact of unforeseen environmental contingencies or new or changed laws or regulations on our Properties, properties that we have sold or on properties that may be acquired by us in the future. See “Risk Factors – Environmental problems at the Properties are possible and may be costly.”

Other

We do not have any foreign operations and our business is not seasonal. Our operations are not dependent on a single tenant or a few tenants as no single tenant accounted for more than 10% of our total 2003 revenue.

Availability of SEC Reports

We file annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K and other information with the SEC. Members of the public may read and copy materials that we file with the SEC at the SEC’s Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. Members of the public may also obtain information on the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet web site that contains reports, proxy and information statements and other information regarding issuers, including us, that file electronically with the SEC. The address of that site is http://www.sec.gov. Our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K and other information filed by us with the SEC are available, without charge, on our Internet web site, http://www.brandywinerealty.com, as soon as reasonably practicable after they are filed electronically with the SEC. Copies are also available, without charge, from Secretary, Brandywine Realty Trust, 401 Plymouth Road, Suite 500, Plymouth Meeting, PA 19462.

Risk Factors

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. Certain information included in this Annual Report on Form 10-K and other materials filed by us with the Securities and Exchange Commission (as well as information included in oral statements or other written statements made or to be made by us) contain statements that are forward-looking, such as statements relating to business development and real estate development activities, acquisitions, dispositions, future capital expenditures, financing sources and availability, and the effects of regulation (including environmental regulation) and competition. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, we can give no

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assurance that our expectations will be achieved. As forward-looking statements, these statements involve risks, uncertainties and other factors that could cause actual results to differ materially from the expected results and, accordingly, such results may differ from those expressed in any forward-looking statements made by, or on behalf of us. Factors that could cause actual results to differ materially from our management’s current expectations include, but are not limited to, changes in general economic conditions, changes in local real estate conditions (including changes in rental rates and the number of competing properties), changes in the economic conditions affecting industries in which our principal tenants compete, our failure to lease unoccupied space in accordance with our projections, our failure to re-lease occupied space upon expiration of leases, the bankruptcy of major tenants, changes in prevailing interest rates, the unavailability of equity and debt financing, unanticipated costs associated with the acquisition and integration of our acquisitions, unanticipated costs to complete and lease-up pending developments, increased costs for, or lack of availability of, adequate insurance, including for terrorist acts, demand for tenant services beyond those traditionally provided by landlords, potential liability under environmental or other laws, the existence of complex regulations relating to our status as a REIT and to our acquisition, disposition and development activities, the adverse consequences of our failure to qualify as a REIT and the other risks identified in this Annual Report on Form 10-K. We assume no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

Our operations are concentrated in the Mid-Atlantic region, and our operational and financial performance depend on the economies in the markets in which we have a presence; changes in such markets may adversely affect our financial condition.

Our Properties are located in suburban markets in Pennsylvania, New Jersey, Virginia and Delaware. We thus do not have a broad geographic distribution of our properties. Like other real estate markets, these markets have experienced economic downturns in the past, and they are currently experiencing a downturn similar to the broader economic slowdown in the U.S. Such a downturn can lead to lower occupancy rates and, consequentially, downward pressure on rental rates. They can also result in companies experiencing difficulty with their cash flow, which might cause them to delay or miss making their lease payments or to declare bankruptcy. Furthermore, such a climate might affect the timing of lease commitments by new tenants or of lease renewals by existing tenants as such parties delay or defer their leasing decisions in order to get the most current information possible about trends in their businesses or industries. A prolonged decline in the economies of these real estate markets could adversely affect our financial position, results of operations, cash flow, and ability to make distributions to shareholders.

Financially distressed tenants may reduce our cash flow.

If one or more of our tenants were to experience financial difficulties, including bankruptcy, insolvency or general downturn of business, there could be an adverse effect our financial performance and distributions to shareholders.

We cannot assure you that any tenant that files for bankruptcy protection will continue to pay us rent. A bankruptcy filing by or relating to one of our tenants or a lease guarantor would bar all efforts by us to collect pre-bankruptcy debts from that tenant or the lease guarantor, or their property, unless we receive an order permitting us to do so from the bankruptcy court. In addition, we cannot evict a tenant solely because of its bankruptcy. A tenant or lease guarantor bankruptcy could delay our efforts to collect past due balances under the relevant leases, and could ultimately preclude collection of these sums. If a lease is assumed by the tenant in bankruptcy, all pre-bankruptcy balances due under the lease must be paid to us in full. However, if a lease is rejected by a tenant in bankruptcy, we would have only a general unsecured claim for damages. Any unsecured claim we hold may be paid only to the extent that funds are available and only in the same percentage as is paid to all other holders of unsecured claims, and there are restrictions under bankruptcy laws that limit the amount of the claim we can make if a lease is rejected. As a result, it is likely that we would recover substantially less than the full value of any unsecured claims we hold. For additional detail on tenant credit risk, see Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Overview – Tenant Credit Risk.

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We may be unable to renew leases or relet space as leases expire.

If tenants do not to renew their leases upon expiration, we may be unable to relet the subject space. Even if the tenants do renew their leases or we can relet the space, the terms of renewal or reletting (including the cost of required renovations) may be less favorable than current lease terms. Certain leases grant the tenants an early termination right upon payment of a termination penalty. For additional detail on the risk of non-renewal of expiring leases, see Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Overview – Tenant Rollover Risk.

New development and acquisitions may not produce results in accordance with our expectations and may require development and renovation costs exceeding our estimates.

Once made, our investments may not produce results in accordance with our expectations. Our actual renovation and improvement costs in bringing an acquired property up to market standards may exceed our estimates.

In addition, we are active in developing and redeveloping office properties. Risks associated with these activities include:

	•	the unavailability of favorable financing, including permanent financing to repay construction financing;

	•	construction costs exceeding original estimates, due to increases in interest rates and increased materials, labor or other costs;

	•	construction and lease-up delays resulting in increased debt service, fixed expenses and construction or renovation costs;

	•	complications (including building moratoriums and anti-growth legislation) in obtaining necessary zoning, occupancy and other governmental permits; and

	•	insufficient occupancy levels and rental rates at a newly completed property causing the property to be unprofitable.

For additional detail on development risks, see Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Overview – Development Risk.

Some potential losses are not covered by insurance.

We carry comprehensive liability, fire, extended coverage and rental loss insurance on all of our Properties. We believe the policy specifications and insured limits of these policies are adequate and appropriate. There are, however, types of losses, such as lease and other contract claims and acts of war, that generally are not insured. Some of our existing insurance policies expire in June 2004. We cannot be assured that we will be able to renew insurance coverage in an adequate amount or at reasonable prices. In addition, insurance companies may no longer offer coverage against certain types of losses, such as losses due to terrorist acts and mold, or, if offered, these types of insurance may be prohibitively expensive. Should an uninsured loss or a loss in excess of insured limits occur, we could lose all or a portion of the capital we have invested in a Property, as well as the anticipated future revenue from the Property. In such an event, we might nevertheless remain obligated for any mortgage debt or other financial obligations related to the Property. We cannot be assured that material losses in excess of insurance proceeds will not occur in the future. If any of our Properties were to experience a catastrophic loss, it could seriously disrupt our operations, delay revenue and result in large expenses to repair or rebuild the Property. Such events could adversely affect our cash flow and ability to make distributions to shareholders.

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Because real estate is illiquid, we may not be able to sell Properties when appropriate.

Real estate investments generally, and large office and industrial properties like those that we own, in particular, often cannot be sold quickly. Consequently, we may not be able to vary our portfolio promptly in response to changes in economic or other conditions. In addition, the Internal Revenue Code of 1986 (the “Code”) limits our ability to sell properties held for fewer than four years. Furthermore, Properties that we acquired in exchange for units in the Operating Partnership often have a low tax basis. If we were to dispose of any of these Properties in a taxable transaction, we may be required to distribute a significant amount of the taxable gain to our security holders under the requirements of the Internal Revenue Code of 1986 applicable to REITs and this could, in turn, impact our cash flow and ability to make distributions to shareholders. In addition, purchase options and rights of first refusal held by certain tenants or partners in Real Estate Ventures may also limit our ability to sell certain properties. Any of these factors could adversely affect our cash flow and ability to make distributions to shareholders as well as the ability of someone to purchase us, even if a purchase were in our shareholders’ best interests.

We have agreed not to sell certain of our Properties.

We have agreed with the former owners of 13 of our Properties aggregating approximately 1.1 million net rentable square feet not to sell these Properties for varying periods of time in transactions that would trigger taxable income to the former owners, subject to certain exceptions. Some of these agreements are with affiliates of current trustees of our company. In addition, we may enter into similar agreements with sellers of Properties acquired by us in the future. These agreements generally provide that we may dispose of the applicable Properties in transactions that qualify as tax-free exchanges under Section 1031 of the Code or in other tax deferred transactions. Such transactions can be difficult and result in the property acquired in exchange for the disposed of property inheriting the tax attributes (including tax protection covenants) of the disposed of property. Without suffering adverse financial consequences, we may be precluded from selling certain Properties other than in transactions that would qualify as tax-free exchanges for federal income tax purposes.

Our operating costs might rise, which might reduce our profitability and have an adverse effect on our cash flow and our ability to make distributions to shareholders.

We might face higher operating expenses as a result of rising costs generally and, in particular, as a result of increased costs following the terrorist attacks in the U.S. on September 11, 2001. For example, it might cost more in the future than in the past for building security, property/casualty and liability insurance, and property maintenance. Following the September 11th attacks, we have increased the level of security at our Properties. We might not be able to pass along the increased costs associated with such increased building security to our tenants, which could reduce our profitability and cash flow. Some of our existing insurance policies expire in June 2004. As a result of the terrorist attacks and other market conditions, the cost of premiums for comparable coverage might be significantly higher when it is time to renew our coverage, which could increase our operating expenses and reduce our profitability and our cash flow. Because of rising costs in general, we might experience increases in our property maintenance costs, such as for cleaning, electricity, and heating, ventilation and air conditioning. In general, under our leases with tenants, we pass on a portion of these costs to them. We cannot be assured, however, that tenants will actually bear the full burden of these higher costs, or that such increased costs will not lead them, or other prospective tenants, to seek office space elsewhere. If operating expenses increase, the availability of other comparable office space in our specific geographic markets might limit our ability to increase rents, which could reduce our profitability (if operating expenses increase without a corresponding increase in revenues) and limit our ability to make distributions to shareholders.

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We face significant competition from other real estate developers.

We compete with real estate developers, operators and institutions for tenants and acquisition and development opportunities. Some of these competitors have significantly greater financial resources than we do. Such competition may reduce the number of suitable investment opportunities offered to us, interfere with our ability to attract and retain tenants and may increase vacancies, which increases supply and lowers market rental rates, reduces our bargaining leverage and adversely affects our ability to improve our operating leverage. In addition, some of our competitors may be willing, because their properties may have vacancy rates higher than those for our properties, to make space available at lower prices than the space in our properties. We cannot be assured that this competition will not adversely affect our cash flow and ability to make distributions to shareholders.

Our ability to make distributions is subject to various risks.

We have been paying quarterly distributions to our shareholders. Our ability to make distributions in the future will depend upon:

	•	the operational and financial performance of our Properties;

	•	capital expenditures with respect to existing and newly acquired Properties;

	•	the amount of, and the interest rates on, our debt; and

	•	the absence of significant expenditures relating to environmental and other regulatory matters.

Certain of these matters are beyond our control and any significant difference between our expectations and actual results could have a material adverse effect on our cash flow and our ability to make distributions to shareholders.

Changes in the law may adversely affect our cash flow.

Because increases in income and service taxes are generally not passed through to tenants under leases, such increases may adversely affect our cash flow and ability to make expected distributions to shareholders. The Properties are also subject to various regulatory requirements, such as those relating to the environment, fire and safety. Our failure to comply with these requirements could result in the imposition of fines and damage awards. Also, the costs to comply with any new or different regulations could adversely affect our cash flow and our ability to make distributions. While we believe that the Properties are currently in material compliance with all such requirements, we cannot be assured that these requirements will not change or that newly imposed requirements will not require significant unanticipated expenditures.

Our indebtedness subjects us to additional risks.

Debt Financing and Existing Debt Maturities. Like other real estate companies, we are subject to risks normally associated with debt financing, such as the insufficiency of cash flow to meet required debt service payment obligations and the inability to refinance existing indebtedness. If our debt cannot be paid, refinanced or extended at maturity, in addition to our failure to repay our debt, we may not be able to make distributions to shareholders at expected levels or at all. Furthermore, an increase in our interest expense could adversely affect our cash flow and ability to make distributions to shareholders. If we do not meet our debt service obligations, any Properties securing such indebtedness could be foreclosed on, which would have a material adverse effect on our cash flow and ability to make distributions and, depending on the number of Properties foreclosed on, could threaten our continued viability.

Risk of Rising Interest Rates and Variable Rate Debt. Increases in interest rates on variable rate indebtedness would increase our interest expense, which could adversely affect our cash flow and ability to make distributions to shareholders. As of December 31, 2003, outstanding borrowings of approximately $290.3 million bear interest at variable rates.

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No Limitation on Debt. Our organizational documents do not contain any limitation on our ability to incur additional debt. Accordingly, subject to limitations in our credit facilities, we could increase our outstanding debt without restriction. The increased debt service could adversely affect our cash flow and ability to make distributions and could increase the risk of default on our indebtedness.

Environmental problems at the Properties are possible and may be costly.

Federal, state and local laws, ordinances and regulations may require a current or previous owner or operator of real estate to investigate and clean up hazardous or toxic substances or releases at such property. The owner or operator may be forced to pay for property damage and for investigation and clean-up costs incurred by others in connection with environmental contamination. Such laws typically impose clean-up responsibility and liability without regard to whether the owner or operator knew of or caused the presence of the contaminants. Even if more than one person may have been responsible for the contamination, each person covered by the environmental laws may be held responsible for all of the clean-up costs incurred. In addition, third parties may sue the owner or operator of a site for damages and costs resulting from environmental contamination emanating from that site. These costs may be substantial and the presence of such substances may adversely affect the owner’s ability to sell or rent such property or to borrow using such property as collateral.

Environmental laws that govern the presence, maintenance and removal of asbestos require that owners or operators of buildings containing asbestos properly manage and maintain the asbestos, notify and train those who may come into contact with asbestos and undertake special precautions, including removal or other abatement, if asbestos would be disturbed during renovation or demolition of a building. Such laws may impose fines and penalties on building owners or operators who fail to comply with these requirements and may allow third parties to seek recovery from owners or operators for personal injury associated with exposure to asbestos fibers.

Independent environmental consultants have conducted a standard Phase I or similar general environmental site assessment (“ESA”) of each of our Properties to identify potential sources of environmental contamination and assess environmental regulatory compliance. For a number of the Properties, the Phase I ESA either referenced a prior Phase II ESA obtained on such Property or prompted us to have a Phase II ESA of such Property conducted. A Phase II ESA generally involves invasive procedures, such as soil sampling and testing or the installation and monitoring of groundwater wells. While the ESAs conducted have identified environmental contamination on a few of the Properties, they have not revealed any environmental contamination, liability or compliance concern that we believe would have a material adverse effect on our cash flow or ability to make distributions to shareholders. It is possible that the existing ESAs relating to the Properties do not reveal all environmental contaminations, liabilities or compliance concerns which currently exist, and it is also possible that the cost of remediating identified contamination may exceed current estimates. In addition, future properties which we acquire may be subject to environmental conditions.

While we have an ongoing maintenance program in place to address indoor air quality, inquiries about indoor air quality may necessitate special investigation and, depending on the results, remediation. Indoor air quality issues can stem from inadequate ventilation, chemical contaminants from indoor or outdoor sources, and biological contaminants such as molds, pollen, viruses and bacteria. Indoor exposure to chemical or biological contaminants above certain levels can be alleged to be connected to allergic reactions or other health effects and symptoms in susceptible individuals. If these conditions occur at one of our Properties, we may need to undertake a targeted remediation program, including without limitation, steps to increase indoor ventilation rates and eliminate sources of contaminants. Such remediation programs are costly and could necessitate the temporary relocation of some or all of the property’s tenants or require rehabilitation of the affected property.

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Americans with Disabilities Act compliance could be costly.

Under the Americans with Disabilities Act of 1990 (“ADA”), all public accommodations and commercial facilities, including office buildings, must meet certain federal requirements related to access and use by disabled persons. Compliance with the ADA requirements could involve removal of structural barriers from certain disabled persons’ entrances which could adversely affect our financial condition and results of operations. Other federal, state and local laws may require modifications to or restrict further renovations of our Properties with respect to such accesses. Although we believe that our properties are currently in material compliance with present requirements, noncompliance with the ADA or similar or related laws or regulations could result in the United States government imposing fines or private litigants being awarded damages against us. In addition, we do not know whether existing requirements will change or whether compliance with future requirements will require significant unanticipated expenditures. Such costs may adversely affect our cash flow and ability to make distributions.

By holding Properties through the Operating Partnership and various joint ventures, we are exposed to additional risks.

We own the Properties and interests in Real Estate Ventures through the Operating Partnership. In the future, we expect to continue to participate with other entities in property ownership through joint ventures or partnerships. Partnership or joint venture investments may involve risks not otherwise present in direct investments. Such risks include:

	•	the potential bankruptcy of our partners or co-venturers;

	•	a conflict between our business goals and those of our partners or co-venturers; and

	•	actions taken by our partners or co-venturers contrary to our instructions or objectives.

There is no limitation under our organizational documents as to the amount of funds which we may invest in partnerships or joint ventures.

Our status as a REIT is dependent on compliance with federal income tax requirements.

Our failure to qualify as a REIT would have serious adverse consequences to our shareholders. We believe that since 1986, we have qualified for taxation as a REIT for federal income tax purposes. We plan to continue to meet the requirements for taxation as a REIT. Many of these requirements are highly technical and complex. The determination that we are a REIT requires an analysis of various factual matters and circumstances that may not be totally within our control. For example, to qualify as a REIT, at least 95% of our gross income must come from certain sources that are itemized in the REIT tax laws. We are also required to distribute to shareholders at least 90% of our REIT taxable income (excluding net capital gains). The fact that we hold our assets through the Operating Partnership and its subsidiaries further complicates the application of the REIT requirements. Even a technical or inadvertent mistake could jeopardize our REIT status. Furthermore, Congress and the IRS might change the tax laws and regulations, and the courts might issue new rulings that make it more difficult, or impossible, for us to remain qualified as a REIT. We do not believe, however, that any pending or proposed tax law changes would jeopardize our REIT status.

To maintain REIT status, a REIT may not own more than 10% of the securities of any corporation, except for a qualified REIT subsidiary (which must be wholly owned by the REIT), taxable REIT subsidiary or another REIT.

If we fail to qualify as a REIT, we would be subject to federal income tax at regular corporate rates. Also, unless the IRS granted us relief under certain statutory provisions, we would remain disqualified as a REIT for four years following the year we first failed to qualify. If we failed to qualify as a REIT, we would be required to pay significant income taxes and would, therefore, have less money available for investments or for distributions to shareholders. This would likely have a material adverse effect on the value of our securities. In addition, we would no longer be required to make any distributions to shareholders.

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In order to make the distributions required to maintain our REIT status, we may need to borrow funds. To obtain the favorable tax treatment associated with REIT qualification, we generally will be required to distribute to shareholders at least 90% of our annual REIT taxable income (excluding net capital gains). In addition, we will be subject to tax on our undistributed net taxable income and net capital gain and a 4% nondeductible excise tax on the amount, if any, by which certain distributions paid by us with respect to any calendar year are less than the sum of 85% of ordinary income plus 95% of capital gain net income for the calendar year, plus certain undistributed amounts from prior years.

We intend to make distributions to shareholders to comply with the distribution provisions of the Code and to avoid income and other taxes. Our income will consist primarily of our share of the income of the Operating Partnership and our cash flow will consist primarily of our share of distributions from the Operating Partnership. Differences in timing between the receipt of income and the payment of expenses in arriving at taxable income (of the Company or the Operating Partnership) and the effect of required debt amortization payments could require us to borrow funds on a short-term basis or to liquidate funds on adverse terms to meet the REIT qualification distribution requirements.

Failure of the Operating Partnership (or a subsidiary partnership) to be treated as a partnership would have serious adverse consequences to our shareholders. If the IRS were to successfully challenge the tax status of the Operating Partnership or any of its subsidiary partnerships for federal income tax purposes, the Operating Partnership or the affected subsidiary partnership would be taxable as a corporation. In such event, we would cease to qualify as a REIT and the imposition of a corporate tax on the Operating Partnership or a subsidiary partnership would reduce the amount of cash available for distribution from such partnership to us and our shareholders.

We do pay some taxes. Even if we qualify as a REIT, we are required to pay certain federal, state and local taxes on our income and Properties. In addition, the Management Company is subject to federal, state and local income tax at regular corporate rates on its net taxable income derived from its management, leasing and related service business. If we have net income from a prohibited transaction, such income will be subject to a 100% tax.

We own a subsidiary REIT. One of our subsidiaries, Atlantic American Properties Trust (“AAPT”), that indirectly holds 22 of the Properties, elected to be taxed as a REIT for the year ended December 31, 1997. So long as we seek to maintain AAPT’s REIT status, AAPT will be subject to all the requirements and risks associated with maintaining REIT status summarized above, including the limitation on the ownership of more than 10% of the securities of any corporation (other than a qualified REIT subsidiary, taxable REIT subsidiary or another REIT).

We are dependent upon our key personnel.

We are dependent upon the efforts of our executive officers, particularly Gerard H. Sweeney. The loss of Mr. Sweeney’s services could have an adverse affect on our operations and would entitle the banks under our Credit Facility to accelerate the amounts due thereunder. Although we have an employment agreement with Mr. Sweeney for a term extending to May 7, 2005, this agreement does not restrict his ability to become employed by a competitor following the termination of his employment with us. We do not have keyman life insurance coverage for Mr. Sweeney.

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Limitations exist with respect to a third party’s ability to acquire us or effectuate a change in control.

Limitations imposed to protect our REIT status. In order to protect us against loss of our REIT status, our Declaration of Trust limits any shareholder from owning more than 9.8% in value of our outstanding shares, subject to certain exceptions. The ownership limit may have the effect of precluding acquisition of control of the Company. If anyone acquires shares in excess of the ownership limit, we may:

•

consider the transfer to be null and void;


	•	not reflect the transaction on our books;


	•	institute legal action to stop the transaction;


	•	not pay dividends or other distributions with respect to those shares;


	•	not recognize any voting rights for those shares; and


	•	consider the shares held in trust for the benefit of a person to whom such shares may be transferred.

Limitation due to our ability to issue preferred shares. Our Declaration of Trust authorizes the Board of Trustees to issue preferred shares. The Board of Trustees may establish the preferences and rights of any preferred shares issued which could have the effect of delaying or preventing someone from taking control of us, even if a change in control were in our shareholders’ best interests.

Limitation imposed by the Maryland Business Combination Law. The Maryland General Corporation Law, as applicable to Maryland real estate investment trusts, establishes special restrictions against “business combinations” between a Maryland real estate investment trust and “interested shareholders” or their affiliates unless an exemption is applicable. An interested shareholder includes a person who beneficially owns, and an affiliate or associate of the trust who, at any time within the two-year period prior to the date in question, was the beneficial owner of, ten percent or more of the voting power of our then-outstanding voting shares. Among other things, the law prohibits (for a period of five years) a merger and certain other transactions between the trust and an interested shareholder unless the Board of Trustees approved the transaction before the party became an interested shareholder. The five-year period runs from the most recent date on which the interested shareholder became an interested shareholder. Thereafter, any such business combination must be recommended by the Board of Trustees and approved by two super-majority shareholder votes unless, among other conditions, the trust’s common shareholders receive a minimum price for their shares and the consideration is received in cash or in the same form as previously paid by the interested shareholder for its shares or unless the Board of Trustees approved the transaction before the party in question became an interested shareholder. The business combination statute could have the effect of discouraging offers to acquire us and of increasing the difficulty of consummating any such offers, even if our acquisition would be in our shareholders’ best interests. We have exempted any business combination involving Safeguard Scientifics, Inc., the Commonwealth of Pennsylvania State Employees’ Retirement System and a voting trust established for its benefit, Morgan Stanley Asset Management Inc. and two funds managed by it, Lazard Freres Real Estate Investors, L.L.C., Five Arrows Realty Securities III L.L.C., Gerard H. Sweeney (the Company’s President and Chief Executive Officer) and any of their respective affiliates or associates.

Maryland Control Share Acquisition Act. Maryland law provides that “control shares” of a real estate investment trust acquired in a “control share acquisition” shall have no voting rights except to the extent approved by a vote of two-thirds of the vote eligible to be cast on the matter under the Maryland Control Share Acquisition Act. “Control Shares” means shares that, if aggregated with all other shares previously acquired by the acquirer, would entitle the acquirer to exercise voting power in electing trustees within one of the following ranges of voting power: one-tenth or more but less than one-third, one-third or more but less than a majority or a majority or more of all voting power. A “control share acquisition” means the acquisition of control shares, subject to certain exceptions. If voting rights or control shares acquired in a control share acquisition are not approved at a shareholder’s meeting, then subject to certain conditions and limitations the issuer may redeem any or all of the control shares for fair value. If voting rights of such control shares are approved at a shareholder’s meeting and the acquirer becomes entitled to

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vote a majority of the shares entitled to vote, all other shareholders may exercise appraisal rights. Any control shares acquired in a control share acquisition which are not exempt under our bylaws will be subject to the Maryland Control Share Acquisition Act. Our bylaws contain a provision exempting from the control share acquisition statute any and all acquisitions by any person of our shares. There can be no assurance that this provision will not be amended or eliminated at any time in the future.

Many factors can have an adverse effect on the market value of our securities.

Like any publicly traded company, a number of factors might adversely affect the price of our securities, many of which are beyond our control. These factors include:

•

Increases in market interest rates, relative to the dividend yield on our shares. If market interest rates go up, prospective purchasers of our securities may require a higher yield. Higher market interest rates would not, however, result in more funds for us to distribute and, to the contrary, would likely increase our borrowing costs and potentially decrease funds available for distribution. Thus, higher market interest rates could cause the market price of our common shares to go down.


	•	Anticipated benefit of an investment in our securities as compared to investment in securities of companies in other industries (including benefits associated with tax treatment of dividends and distributions).


	•	Perception by market professionals of REITs generally and REITs comparable to us in particular.


	•	Perception by market participants of our potential for payment of cash distributions and for growth.


	•	Level of institutional investor interest in our securities.


	•	Relatively low trading volumes in securities of REITs.


	•	Our results of operations and financial condition.


	•	Investor confidence in the stock market generally.

The market value of our Common Shares is based primarily upon the market’s perception of our growth potential and our current and potential future earnings and cash distributions. Consequently, our Common Shares may trade at prices that are higher or lower than our net asset value per Common Share. If our future earnings or cash distributions are less than expected, it is likely that the market price of our Common Shares will diminish.

The issuance of preferred securities may adversely affect the rights of holders of Common Shares.

Because our Board of Trustees has the power to establish the preferences and rights of each class or series of Preferred Shares, it may afford the holders in any series or class of preferred shares preferences, distributions, powers and rights, voting or otherwise, senior to the rights of holders of Common Shares. The Board of Trustees also has the power to establish the preferences and rights of each class or series of units in the Operating Partnership, and may afford the holders in any series or class of preferred units preferences, distributions, powers and rights, voting or otherwise, senior to the rights of holders of common units.

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Item 2. Properties

Operating Property Acquisitions

We acquired the following operating properties during the year ended December 31, 2003:

Month of Acquisition	Property/Portfolio Name	Location	# of Buildings	Rentable Square Feet		Purchase Price

						(in 000’s)
Oct-03	Swedesford Road	King of Prussia, PA	4	247,817	$	44,800,000
Dec-03	989 Lenox Drive	Lawrenceville, NJ	1	112,055		20,000,000

	Total Office Property Acquisitions		5	359,872	$	64,800,000

During 2003, we acquired one parcel of land, containing 10.0 acres, for $3.0 million.

Development Properties Placed in Service

We placed in service the following properties during the year ended December 31, 2003:

Month Placed in Service	Property/Portfolio Name	Location	# of Buildings	Rentable Square Feet		Net Investment

						(in 000’s)
Jan-03	401 Plymouth Road	Plymouth Meeting, PA	1	200,000	$	39,433
Feb-03	400 Berwyn Park	Berwyn, PA	1	125,000		19,992
Jul-03	935 First Avenue	King of Prussia, PA	1	103,092		14,990

	Total Office Properties Placed in Service		3	428,092	$	74,415

We place a property under development in service once a property reaches 95% occupancy or one year after the completion of shell construction, whichever is earlier.

Property Sales and Dispositions

We sold or disposed of the following properties during the year ended December 31, 2003:

Month of Sale	Property/Portfolio Name	Location	# of Bldgs.	Rentable Square Feet		Sales/Disposition Price

						(in 000’s)
Feb-03	Greentree Exec. Campus	Marlton, NJ	—	28,444	$	2,560
May-03	200 Nationwide Drive	Harrisburg, PA	1	2,500		875
Jul-03	1000 Lincoln Drive East	Marlton, NJ	1	40,600		1,950
Jul-03	Greentree Exec. Campus	Marlton, NJ	1	10,506		1,025
Sep-03	55 Ames Court	Long Island, NY	1	90,000		5,350
Oct-03	104 Windsor Drive	East Windsor, NJ	1	65,980		8,400
Oct-03	Berkshire Boulevard	Wyomissing, PA	2	95,766		8,625
Oct-03	3000 Lincoln Drive	Marlton, NJ	1	36,070		3,303
Oct-03	4000/5000/9000 Lincoln Drive	Marlton, NJ	2	103,810		9,343
Dec-03	I & III Christina Centre (a)	Wilmington, DE	2	632,797		112,800

	Total Properties Sold		12	1,106,473	$	154,231

(a)

These two properties were contributed to a joint venture in which we retained a 20% interest.

During 2003, we sold four parcels of land, containing 24.1 acres, for $4.2 million.

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Properties

As of December 31, 2003, we owned 208 office properties, 25 industrial facilities and one mixed-use property that contained an aggregate of approximately 15.7 million net rentable square feet. The properties are located in the markets in and surrounding Philadelphia, Pennsylvania; New Jersey; and Richmond, Virginia. As of December 31, 2003, the Properties were approximately 90.7% leased to 1,025 tenants and had an average age of approximately 16.7 years. The office properties are primarily one to three story suburban office buildings containing an average of approximately 60,580 net rentable square feet. The industrial properties accommodate a variety of tenant uses, including light manufacturing, assembly, distribution and warehousing. We carry comprehensive liability, fire, extended coverage and rental loss insurance covering all of the Properties, with policy specifications and insured limits which we believe are adequate.

We had the following projects in development or redevelopment as of December 31, 2003:

Project Name	Location	Rentable Square Feet	% Leased as of 12/31/03	Estimated Project Completion Date	Estimated Project Stabilization Date (a)		Total Cost Incurred as of 12/31/03		Estimated Total Development Cost (b)

							(in 000’s)		(in 000’s)
Under Development:
Cira Centre	Philadelphia, PA	727,000	51%	Dec-05	Apr-07	$	6,116	$	190,807
Bishops Gate	Mount Laurel, NJ	53,700	69%	Jul-04	Jul-05		1,480		7,924
6990 Snowdrift (Bldg A)	Allentown, PA	44,200	69%	Oct-03	Dec-04		5,243		5,713
6990 Snowdrift (Bldg B)	Allentown, PA	27,900	0%	Dec-03	Dec-04		2,246		3,289

		852,800					15,085		207,733

Under Redevelopment:
7535 Windsor Drive	Allentown, PA	128,061	50%	Oct-03	Dec-04	$	2,412	$	3,432
855 Springdale Drive	West Whitefield, PA	50,750	0%	Dec-04	Dec-05		169		3,400
501 Office Center Drive	Fort Washington, PA	114,837	47%	Oct-03	Dec-04		214		10,889

		293,648					2,795		17,721

		1,146,448				$	17,880	$	225,454

(a)	Stabilization date represents date at which the property is projected to be 95% leased.
(b)	Total development cost includes land acquisition costs, land carry costs, hard and soft construction costs, tenant improvements and broker commissions.

The following table sets forth information with respect to the Properties at December 31, 2003:

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Property Name	Location		State		Year Built		Net Rentable Square Feet		Percentage Leased as of December 31, 2003 (a)			Total Base Rent for the Twelve Months Ended December 31, 2003 (b) (000’s)		Average Annualized Rental Rate as of December 31, 2003 (c)

PENNSYLVANIA SEGMENT
100-300 Gundy Drive		Reading		PA		1970		439,167		96.8	%	$	6,939	$	15.69
401 Plymouth Road		Plymouth Meeting		PA		2001		202,662		87.6	%		4,435		27.64
Philadelphia Marine Center		(d) Philadelphia		PA		Various		181,900		100.0	%		1,411		4.97
300 Corporate Center Drive		Camp Hill		PA		1989		175,280		100.0	%		3,391		20.63
111 Presidential Boulevard		Bala Cynwyd		PA		1997		173,095		32.7	%		3,346		28.51
751-761 Fifth Avenue		King Of Prussia		PA		1967		158,000		100.0	%		500		3.15
630 Allendale Road		King of Prussia		PA		2000		150,000		100.0	%		3,678		24.25
640 Freedom Business Center		(d) King Of Prussia		PA		1991		132,000		98.3	%		2,761		26.43
100 Katchel Blvd		Reading		PA		1970		131,082		100.0	%		2,953		21.04
52 Swedesford Square		East Whiteland Twp.		PA		1988		131,017		100.0	%		2,862		23.69
105 / 140 Terry Drive		Newtown		PA		1982		128,666		92.5	%		1,703		15.06
7535 Windsor Drive		Allentown		PA		1988		128,061		—	(e)		—		—
400 Berwyn Park		Berwyn		PA		1999		124,172		42.5	%		1,692		30.67
101 Lindenwood Drive		Malvern		PA		1988		118,121		95.5	%		2,501		21.49
501 Office Center Drive		Fort Washington		PA		1974		114,837		—	(e)		—		—
7130 Ambassador Drive		Allentown		PA		1991		114,049		100.0	%		527		6.49
7350 Tilghman Street		Allentown		PA		1987		111,500		100.0	%		1,976		19.10
300 Berwyn Park		Berwyn		PA		1989		109,919		100.0	%		2,207		24.56
50 Swedesford Square		East Whiteland Twp.		PA		1986		109,800		100.0	%		1,928		18.22
920 Harvest Drive		Blue Bell		PA		1990		104,505		100.0	%		2,100		20.09
442 Creamery Way		Exton		PA		1991		104,500		100.0	%		598		6.72
935 First Avenue		King of Prussia		PA		2001		103,090		—			—		—
100 Brandywine Boulevard		Newtown		PA		2002		102,000		100.0	%		2,681		23.26
500 Office Center Drive		Fort Washington		PA		1974		101,303		99.0	%		1,944		22.15
7450 Tilghman Street		Allentown		PA		1986		100,000		81.2	%		1,358		18.91
301 Lindenwood Drive		Malvern		PA		1984		97,624		85.5	%		1,622		18.71
555 Croton Road		King of Prussia		PA		1999		96,909		100.0	%		2,898		31.14
500 North Gulph Road		King Of Prussia		PA		1979		93,082		71.5	%		1,378		21.08
620 West Germantown Pike		Plymouth Meeting		PA		1990		90,169		73.4	%		2,106		29.63
610 West Germantown Pike		Plymouth Meeting		PA		1987		90,152		94.2	%		2,481		31.83
630 West Germantown Pike		Plymouth Meeting		PA		1988		89,925		86.2	%		2,081		27.99
600 West Germantown Pike		Plymouth Meeting		PA		1986		89,681		94.0	%		2,213		30.18
630 Freedom Business Center		(d) King Of Prussia		PA		1989		86,683		94.3	%		1,976		27.16
620 Freedom Business Center		(d) King Of Prussia		PA		1986		86,559		45.4	%		778		14.47
1200 Swedsford Road		Berwyn		PA		1994		86,000		100.0	%		1,587		21.38
595 East Swedesford Road		Wayne		PA		1998		81,890		100.0	%		381		26.25
3331 Street Road – Greenwood Square		Bensalem		PA		1986		81,575		100.0	%		1,623		20.95
1050 Westlakes Drive		Berwyn		PA		1984		80,000		100.0	%		2,415		28.73
One Progress Avenue		Horsham		PA		1986		79,204		100.0	%		841		11.54
1060 First Avenue		(d) King Of Prussia		PA		1987		77,718		52.5	%		1,199		21.24
741 First Avenue		King Of Prussia		PA		1966		77,184		100.0	%		580		8.42
323 Norristown Road		Lower Gwyned		PA		1988		76,287		97.1	%		295		5.03
1040 First Avenue		(d) King Of Prussia		PA		1985		75,488		64.0	%		1,490		26.36
200 Berwyn Park		Berwyn		PA		1987		75,025		84.0	%		1,519		28.04
1020 First Avenue		(d) King Of Prussia		PA		1984		74,556		100.0	%		1,642		21.52
1000 First Avenue		(d) King Of Prussia		PA		1980		74,139		96.9	%		1,713		24.07
160 - 180 West Germantown Pike		East Norriton		PA		1982		73,394		69.6	%		968		17.97
436 Creamery Way		Exton		PA		1991		72,300		89.1	%		596		11.96
14 Campus Boulevard		Newtown Square		PA		1998		69,542		100.0	%		1,332		22.78
500 Enterprise Road		Horsham		PA		1990		66,751		100.0	%		934		19.73
575 East Swedesford Road		Wayne		PA		1985		66,503		98.1	%		312		28.52
925 Harvest Drive		Blue Bell		PA		1990		63,663		92.9	%		1,155		20.34
429 Creamery Way		Exton		PA		1996		63,420		100.0	%		749		13.80
610 Freedom Business Center		(d) King Of Prussia		PA		1985		62,991		88.6	%		1,312		26.56
980 Harvest Drive		Blue Bell		PA		1988		62,379		100.0	%		1,446		25.07
426 Lancaster Avenue		Devon		PA		1990		61,102		100.0	%		1,122		19.14

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Property Name	Location		State		Year Built		Net Rentable Square Feet		Percentage Leased as of December 31, 2003 (a)			Total Base Rent for the Twelve Months Ended December 31, 2003 (b) (000’s)		Average Annualized Rental Rate as of December 31, 2003 (c)

3329 Street Road – Greenwood Square		Bensalem		PA		1985		60,705		100.0	%		930		20.43
1180 Swedesford Road		Berwyn		PA		1987		60,371		100.0	%		1,684		29.29
1160 Swedesford Road		Berwyn		PA		1986		60,099		91.7	%		1,465		25.25
200 Corporate Center Drive		Camp Hill		PA		1989		60,000		100.0	%		1,071		18.43
321 Norristown Road		Lower Gwyned		PA		1988		59,994		98.9	%		953		17.05
100 Berwyn Park		Berwyn		PA		1986		57,731		68.4	%		876		31.07
440 Creamery Way		Exton		PA		1991		57,218		100.0	%		518		11.87
640 Allendale Road		King of Prussia		PA		2000		56,034		100.0	%		310		6.25
565 East Swedesford Road		Wayne		PA		1984		55,789		82.5	%		224		29.29
680 Allendale Road		King Of Prussia		PA		1962		52,528		100.0	%		544		11.90
2240/50 Butler Pike		Plymouth Meeting		PA		1984		52,229		100.0	%		886		20.89
650 Park Avenue		King Of Prussia		PA		1968		51,711		14.9	%		258		6.31
1155 Business Center Drive		Horsham		PA		1990		51,388		86.4	%		579		18.90
486 Thomas Jones Way		Exton		PA		1990		51,372		79.9	%		620		18.13
800 Business Center Drive		Horsham		PA		1986		51,236		100.0	%		598		12.15
855 Springdale Drive		Exton		PA		1986		50,750		—	(e)		—		—
660 Allendale Road		King of Prussia		PA		1962		50,635		100.0	%		365		8.33
15 Campus Boulevard		Newtown Square		PA		2002		50,000		100.0	%		1,338		25.00
875 First Avenue		King Of Prussia		PA		1966		50,000		100.0	%		605		18.50
630 Clark Avenue		King Of Prussia		PA		1960		50,000		100.0	%		301		7.02
620 Allendale Road		King Of Prussia		PA		1961		50,000		79.8	%		837		20.45
7150 Windsor Drive		Allentown		PA		1988		49,420		100.0	%		644		14.77
479 Thomas Jones Way		Exton		PA		1988		49,264		84.2	%		566		16.49
17 Campus Boulevard		Newtown Square		PA		2001		48,565		100.0	%		1,224		25.55
520 Virginia Drive		Fort Washington		PA		1987		48,122		100.0	%		902		19.75
11 Campus Boulevard		Newtown Square		PA		1998		47,700		100.0	%		1,077		22.83
456 Creamery Way		Exton		PA		1987		47,604		100.0	%		364		7.89
6575 Snowdrift Road		Allentown		PA		1988		47,091		100.0	%		568		13.11
220 Commerce Drive		Fort Washington		PA		1985		46,080		89.5	%		871		20.82
7248 Tilghman Street		Allentown		PA		1987		43,782		78.3	%		552		17.49
110 Summit Drive		Exton		PA		1985		43,660		100.0	%		392		11.76
585 East Swedesford Road		Wayne		PA		1998		43,635		100.0	%		226		28.38
7360 Windsor Drive		Allentown		PA		2001		43,600		100.0	%		935		23.67
1100 Cassett Road		Berwyn		PA		1997		43,480		100.0	%		1,106		26.68
467 Creamery Way		Exton		PA		1988		42,000		100.0	%		498		17.88
300 Welsh Road – Building I		Horsham		PA		1980		40,042		55.3	%		575		21.01
7310 Tilghman Street		Allentown		PA		1985		40,000		92.6	%		471		17.16
150 Corporate Center Drive		Camp Hill		PA		1987		39,401		93.9	%		626		18.54
1336 Enterprise Drive		West Goshen		PA		1989		39,330		100.0	%		720		20.50
600 Park Avenue		King Of Prussia		PA		1964		39,000		100.0	%		530		15.33
412 Creamery Way		Exton		PA		1999		38,098		57.9	%		548		19.98
755 Business Center Drive		Horsham		PA		1998		38,050		100.0	%		576		22.88
18 Campus Boulevard		Newtown Square		PA		1990		37,374		85.3	%		758		23.06
457 Creamery Way		Exton		PA		1990		36,019		100.0	%		427		16.37
100 Arrandale Boulevard		Exton		PA		1997		34,931		100.0	%		485		18.60
7010 Snowdrift Road		Allentown		PA		1991		33,029		100.0	%		447		18.53
300 Lindenwood Drive		Allentown		PA		1991		33,000		100.0	%		671		21.18
2260 Butler Pike		Plymouth Meeting		PA		1984		31,892		100.0	%		466		14.32
700 Business Center Drive		Horsham		PA		1986		30,773		33.0	%		21		17.50
120 West Germantown Pike		Plymouth Meeting		PA		1984		30,546		50.0	%		271		17.87
650 Dresher Road		Horsham		PA		1984		30,071		100.0	%		684		21.75
655 Business Center Drive		Horsham		PA		1997		29,849		100.0	%		391		15.76
468 Thomas Jones Way		Exton		PA		1990		28,934		100.0	%		543		18.37
630 Dresher Road		Horsham		PA		1987		28,894		100.0	%		664		23.98
1700 Paoli Pike		Malvern		PA		2000		28,000		100.0	%		274		16.75
140 West Germantown Pike		Plymouth Meeting		PA		1984		25,357		100.0	%		504		23.40
3333 Street Road – Greenwood Square		Bensalem		PA		1988		25,000		100.0	%		539		21.49
800 Corporate Circle Drive		Harrisburg		PA		1979		24,862		100.0	%		389		15.97
2490 Boulevard of the Generals		King Of Prussia		PA		1975		20,600		100.0	%		420		20.40
481 John Young Way		Exton		PA		1997		19,275		100.0	%		405		21.89
100 Lindenwood Drive		Malvern		PA		1985		18,400		100.0	%		134		9.00
500 Nationwide Drive		Harrisburg		PA		1977		18,027		100.0	%		324		18.66
600 Corporate Circle Drive		Harrisburg		PA		1978		17,858		100.0	%		288		15.55

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Property Name	Location		State		Year Built		Net Rentable Square Feet		Percentage Leased as of December 31, 2003 (a)			Total Base Rentfor the Twelve Months Ended December 31, 2003 (b) (000’s)		Average Annualized Rental Rate as of December 31, 2003 (c)

300 Welsh Road — Building II		Horsham		PA		1980		17,750		100.0	%		347		21.35
748 Springdale Drive		Exton		PA		1986		13,950		100.0	%		253		19.03
200 Lindenwood Drive		Malvern		PA		1984		12,600		50.0	%		120		19.05
2404 Park Drive		Harrisburg		PA		1983		11,000		64.8	%		137		14.63
111 Arrandale Road		Exton		PA		1996		10,479		100.0	%		204		21.04
2401 Park Drive		Harrisburg		PA		1984		10,074		33.2	%		119		17.50
George Kachel Farmhouse		Reading		PA		2000		1,664		100.0	%		33		20.03
400 Commerce Drive		Newark		DE		1997		154,086		100.0	%		2,268		15.07
One Righter Parkway		(d) Wilmington		DE		1989		104,828		100.0	%		2,293		24.23
Two Righter Parkway		(d) Wilmington		DE		1987		95,514		100.0	%		1,919		21.02
200 Commerce Drive		Newark		DE		1998		68,034		100.0	%		1,073		15.85
100 Commerce Drive		Newark		DE		1989		62,787		57.8	%		523		17.81
111/113 Pencader Drive		Newark		DE		1990		52,665		72.4	%		344		11.20

NEW JERSEY SEGMENT
50 East State Street		Trenton		NJ		1989		305,884		92.2	%		5,127		24.63
1009 Lenox Drive		Lawrenceville		NJ		1989		180,460		100.0	%		4,379		26.28
10000 Midlantic Drive		Mt. Laurel		NJ		1990		179,098		100.0	%		3,083		23.17
33 West State Street		Trenton		NJ		1988		167,774		100.0	%		2,975		28.85
Main Street — Plaza 1000		Voorhees		NJ		1988		162,364		88.1	%		3,256		23.47
55 U.S. Avenue		Gibbsboro		NJ		1982		138,982		25.5	%		328		9.50
457 Haddonfield Road		Cherry Hill		NJ		1990		121,737		97.8	%		2,511		23.41
2000 Midlantic Drive		Mt. Laurel		NJ		1989		121,658		97.3	%		1,910		21.22
2000 Lenox Drive		Lawrenceville		NJ		2000		119,114		100.0	%		3,200		27.71
700 East Gate Drive		Mt. Laurel		NJ		1984		118,899		100.0	%		2,397		23.14
989 Lenox Drive		Lawrenceville		NJ		1984		112,055		89.9	%		20		26.26
993 Lenox Drive		Lawrenceville		NJ		1985		111,124		100.0	%		2,726		23.19
1000 Howard Boulevard		Mt. Laurel		NJ		1988		105,312		100.0	%		2,166		22.21
One South Union Place		Cherry Hill		NJ		1982		99,573		90.4	%		1,446		18.84
997 Lenox Drive		Lawrenceville		NJ		1987		97,277		100.0	%		2,084		24.25
1000 Atrium Way		Mt. Laurel		NJ		1989		97,158		87.7	%		1,768		21.36
1120 Executive Boulevard		Marlton		NJ		1987		95,278		100.0	%		2,035		24.58
15000 Midlantic Drive		Mt. Laurel		NJ		1991		84,056		88.9	%		1,326		23.03
220 Lake Drive East		Cherry Hill		NJ		1988		78,509		100.0	%		1,741		23.26
1007 Laurel Oak Road		Voorhees		NJ		1996		78,205		100.0	%		621		7.94
10 Lake Center Drive		Marlton		NJ		1989		76,359		100.0	%		1,604		23.44
200 Lake Drive East		Cherry Hill		NJ		1989		76,352		88.7	%		1,699		23.47
Three Greentree Centre		Marlton		NJ		1984		69,300		100.0	%		1,377		20.73
King & Harvard Avenue		Cherry Hill		NJ		1974		67,444		100.0	%		1,336		20.59
9000 Midlantic Drive		Mt. Laurel		NJ		1989		67,299		100.0	%		862		19.38
6 East Clementon Road		Gibbsboro		NJ		1980		66,236		98.0	%		982		16.94
701 East Gate Drive		Mt. Laurel		NJ		1986		61,794		78.2	%		1,146		21.36
210 Lake Drive East		Cherry Hill		NJ		1986		60,604		100.0	%		1,319		22.89
308 Harper Drive		Mt. Laurel		NJ		1976		59,500		86.4	%		1,114		20.98
305 Fellowship Drive		Mt. Laurel		NJ		1980		56,824		95.2	%		1,181		23.11
Two Greentree Centre		Marlton		NJ		1983		56,075		100.0	%		948		20.88
309 Fellowship Drive		Mt. Laurel		NJ		1982		55,911		100.0	%		1,193		23.43
One Greentree Centre		Marlton		NJ		1982		55,838		84.7	%		990		20.08
8000 Lincoln Drive		Marlton		NJ		1997		54,923		67.1	%		745		20.54
307 Fellowship Drive		Mt. Laurel		NJ		1981		54,485		92.3	%		1,098		22.03
303 Fellowship Drive		Mt. Laurel		NJ		1979		53,848		76.1	%		723		21.21
1000 Lenox Drive		Lawrenceville		NJ		1982		52,264		100.0	%		—		22.50
2 Foster Avenue		Gibbsboro		NJ		1974		50,761		94.6	%		234		4.97
4000 Midlantic Drive		Mt. Laurel		NJ		1998		46,945		100.0	%		905		21.40
Five Eves Drive		Marlton		NJ		1986		45,564		95.2	%		716		18.00
161 Gaither Drive		Mount Laurel		NJ		1987		44,739		100.0	%		895		21.05
Main Street — Piazza		Voorhees		NJ		1990		41,408		100.0	%		679		16.56
30 Lake Center Drive		Marlton		NJ		1986		40,287		100.0	%		789		20.11
20 East Clementon Road		Gibbsboro		NJ		1986		38,260		94.6	%		673		18.75
Two Eves Drive		Marlton		NJ		1987		37,532		100.0	%		660		18.08
1255 Broad Street		Bloomfield		NJ		1981		37,478		100.0	%		590		23.88
304 Harper Drive		Mt. Laurel		NJ		1975		32,978		100.0	%		618		20.37
Main Street — Promenade		Voorhees		NJ		1988		31,445		90.7	%		452		16.58
Four B Eves Drive		Marlton		NJ		1987		27,011		100.0	%		344		17.34
815 East Gate Drive		Mt. Laurel		NJ		1986		25,500		100.0	%		291		17.85

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Property Name	Location		State		Year Built		Net Rentable Square Feet		Percentage Leased as of December 31, 2003 (a)			Total Base Rentfor the Twelve Months Ended December 31, 2003 (b) (000’s)		Average Annualized Rental Rate as of December 31, 2003 (c)

817 East Gate Drive		Mt. Laurel		NJ		1986		25,351		100.0	%		357		15.59
Four A Eves Drive		Marlton		NJ		1987		24,687		57.1	%		241		12.91
1 Foster Avenue		Gibbsboro		NJ		1972		24,255		100.0	%		85		—
4 Foster Avenue		Gibbsboro		NJ		1974		23,372		88.3	%		109		7.92
7 Foster Avenue		Gibbsboro		NJ		1983		22,158		100.0	%		333		18.01
10 Foster Avenue		Gibbsboro		NJ		1983		18,651		70.7	%		199		17.18
305 Harper Drive		Mt. Laurel		NJ		1979		14,980		100.0	%		124		8.96
5 U.S. Avenue		Gibbsboro		NJ		1987		5,000		100.0	%		22		4.40
50 East Clementon Road		Gibbsboro		NJ		1986		3,080		100.0	%		145		47.01
5 Foster Avenue		Gibbsboro		NJ		1968		2,000		100.0	%		—		—

VIRGINIA SEGMENT
600 East Main Street		Richmond		VA		1986		424,228		72.1	%		5,882		19.39
300 Arboretum Place		Richmond		VA		1988		212,635		100.0	%		3,686		17.33
6802 Paragon Place		Richmond		VA		1989		143,217		81.1	%		2,724		16.97
2511 Brittons Hill Road		Richmond		VA		1987		132,103		100.0	%		589		5.72
2100-2116 West Laburnam Avenue		Richmond		VA		1976		127,300		93.9	%		1,819		15.29
1957 Westmoreland Street		Richmond		VA		1975		121,815		100.0	%		533		5.04
2201-2245 Tomlynn Street		Richmond		VA		1989		85,860		91.2	%		551		8.11
100 Gateway Centre Parkway		Richmond		VA		2001		74,585		100.0	%		1,470		19.98
9011 Arboretum Parkway		Richmond		VA		1991		72,932		100.0	%		1,109		16.84
4805 Lake Brooke Drive		Glen Allen		VA		1996		61,657		81.4	%		879		17.15
9100 Arboretum Parkway		Richmond		VA		1988		57,519		100.0	%		1,063		18.75
2812 Emerywood Parkway		Henrico		VA		1980		56,076		55.8	%		229		11.74
2277 Dabney Road		Richmond		VA		1986		50,400		100.0	%		251		6.43
9200 Arboretum Parkway		Richmond		VA		1988		49,542		100.0	%		606		12.03
9210 Arboretum Parkway		Richmond		VA		1988		48,012		83.3	%		420		10.30
2212-2224 Tomlynn Street		Richmond		VA		1985		45,353		100.0	%		251		6.93
2221-2245 Dabney Road		Richmond		VA		1994		45,250		84.1	%		259		8.23
2201 Dabney Road		Richmond		VA		1962		45,000		100.0	%		105		2.87
2251 Dabney Road		Richmond		VA		1983		42,000		90.0	%		208		6.57
2161-2179 Tomlynn Street		Richmond		VA		1985		41,550		50.5	%		180		6.58
2256 Dabney Road		Richmond		VA		1982		33,600		100.0	%		208		7.16
2246 Dabney Road		Richmond		VA		1987		33,271		100.0	%		288		9.50
2244 Dabney Road		Richmond		VA		1993		33,050		100.0	%		297		9.71
9211 Arboretum Parkway		Richmond		VA		1991		30,791		100.0	%		395		13.60
2248 Dabney Road		Richmond		VA		1989		30,184		85.6	%		188		8.98
2130-2146 Tomlynn Street		Richmond		VA		1988		29,700		100.0	%		182		10.02
2120 Tomlyn Street		Richmond		VA		1986		23,850		85.5	%		104		7.48
2240 Dabney Road		Richmond		VA		1984		15,389		100.0	%		139		10.08
4364 South Alston Avenue		Durham		NC		1985		56,601		100.0	%		1,121		18.98

TOTAL ALL PROPERTIES / WEIGHTED AVG.								15,732,942		90.7%

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(a)	Calculated by dividing net rentable square feet included in leases signed on or before December 31, 2003 at the property by the aggregate net rentable square feet of the Property.

(b)

“Total Base Rent” for the twelve months ended December 31, 2003 represents base rents received during such period, excluding tenant reimbursements, calculated in accordance with generally accepted accounting principles (GAAP) determined on a straight-line basis. Tenant reimbursements generally include payment of real estate taxes, operating expenses and common area maintenance and utility charges.

(c)

“Average Annualized Rental Rate” is calculated as follows: (i) for office leases written on a triple net basis, the sum of the annualized contracted base rental rates payable for all space leased as of December 31, 2003 (without giving effect to free rent or scheduled rent increases that would be taken into account under GAAP) plus the 2003 budgeted operating expenses excluding tenant electricity; and (ii) for office leases written on a full service basis, the annualized contracted base rent payable for all space leased as of December 31, 2003. In both cases, the annualized rental rate is divided by the total square footage leased as of December 31, 2003 without giving effect to free rent or scheduled rent increases that would be taken into account under GAAP.

(d)	This Property is subject to a ground lease.

(e)	These properties are under redevelopment and are excluded from the percentages for Weighted Average Percentage Leased and Average Annualized Rental Rate information.

The following table shows certain information regarding rental rates and lease expirations for the Properties at December 31, 2003, assuming none of the tenants exercises renewal options or termination rights, if any, at or prior to scheduled expirations:

Year of Lease Expiration December 31,	Number of Leases Expiring Within the Year		Rentable Square Footage Subject to Expiring Leases		Final Annualized Base Rent Under Expiring Leases (a)		Final Annualized Base Rent Per Square Foot Under Expiring Leases		Percentage of Total Final Annualized Base Rent Under Expiring Leases			Cumulative Total

2004		262		1,803,339		28,997,114		16.08		10.8	%		10.8%
2005		248		2,552,830		47,246,198		18.51		17.7	%		28.5%
2006		198		1,849,265		33,814,565		18.29		12.7	%		41.2%
2007		137		1,691,701		30,611,739		18.10		11.5	%		52.6%
2008		144		1,521,460		32,525,673		21.38		12.2	%		64.8%
2009		71		1,090,063		22,485,545		20.63		8.4	%		73.2%
2010		40		1,143,830		26,373,818		23.06		9.9	%		83.1%
2011		20		623,396		11,265,465		18.07		4.2	%		87.3%
2012		15		612,623		11,315,519		18.47		4.2	%		91.5%
2013		7		211,593		5,440,520		25.71		2.0	%		93.6%
2014 and thereafter		27		896,177		17,211,028		19.20		6.4	%		100.0%

		1,169		13,996,277	$	267,287,184	$	19.10		100.0%

(a)

“Final Annualized Base Rent” for each lease scheduled to expire represents the cash rental rate of base rents, excluding tenant reimbursements, in the final month prior to expiration multiplied by 12. Tenant reimbursements generally include payment of real estate taxes, operating expenses and common area maintenance and utility charges.

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At December 31, 2003, the Properties were leased to 1,025 tenants that are engaged in a variety of businesses. The following table sets forth information regarding leases at the Properties with the 20 tenants with the largest amounts leased based upon Annualized Escalated Rent from the Properties as of December 31, 2003:

			Weighted									Percentage of
			Average		Aggregate		Percentage			Annualized		Aggregate
	Number		Remaining		Square		of Aggregate			Escalated		Annualized
	of		Lease Term		Feet		Leased			Rent (in		Escalated
Tenant Name (a)	Leases		in Months		Leased		Square Feet			000) (b)		Rent

State of New Jersey		6		57		442,451		3.2	%		12,639		4.3	%
Computer Sciences Corporation		6		33		345,284		2.5	%		7,021		2.4	%
Verizon		5		44		237,126		1.7	%		5,635		1.9	%
Penske Truck Leasing		1		204		308,205		2.2	%		5,419		1.8	%
Lockheed Martin		8		23		336,678		2.4	%		4,302		1.5	%
Omnicare Clinical Research		1		79		150,000		1.1	%		3,938		1.3	%
First Consulting Group		1		52		118,138		0.8	%		3,689		1.3	%
Parsons Corporation		4		50		174,689		1.2	%		3,669		1.2	%
Hartford Life		4		41		169,170		1.2	%		3,567		1.2	%
Aventis Behring		1		46		143,025		1.0	%		3,361		1.1	%
General Electric		3		22		119,861		0.9	%		2,980		1.0	%
Travelers		4		16		148,689		1.1	%		2,920		1.0	%
Highmark Corporation		4		82		135,298		1.0	%		2,902		1.0	%
ICT Group		2		137		117,151		0.8	%		2,862		1.0	%
Keystone Health Plan Central		1		8		122,101		0.9	%		2,735		0.9	%
Kimberly Clark Corporation (Scott Paper)		2		26		99,329		0.7	%		2,590		0.9	%
Automotive Rentals		4		80		120,952		0.9	%		2,582		0.9	%
AstraZeneca		2		34		107,328		0.8	%		2,491		0.8	%
Dermik Labs		1		80		80,000		0.6	%		2,459		0.8	%
Aetna Life Insurance		1		18		104,505		0.7	%		2,309		0.8	%

Consolidated Total/Weighted Average		61		60		3,579,980		25.7	%	$	80,070		27.1	%

(a)	The identified tenant includes affiliates in certain circumstances.

(b)

Annualized Escalated Rent represents the monthly Escalated Rent for each lease in effect at December 31, 2003 multiplied by 12. Escalated Rent represents fixed base rental amounts plus tenant reimbursements which include payment of real estate taxes, operating expenses and common area maintenance and utility charges. The Company estimates operating expense reimbursements based on historical amounts and comparable market data.

The following table sets forth the year-end occupancy percentages of the Company’s Properties for the last five years:

Year ended December 31,	Occupancy %


2003		90.7	%
2002		91.0	%
2001		92.2	%
2000		95.6	%
1999		94.1	%

Real Estate Ventures

As of December 31, 2003, we had invested approximately $15.9 million in ten unconsolidated Real Estate Ventures (net of returns of investment received). We formed these ventures with unaffiliated third parties to develop office properties or to acquire land in anticipation of possible development of office properties. Nine of the Real Estate Ventures own ten office buildings that contain an aggregate of approximately 1.8 million net rentable square feet and one Real Estate Venture developed a hotel property that contains 137 rooms. At December 31, 2003, the operating properties owned by the Real Estate Ventures were approximately 81% leased to 80 tenants.

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Our investment in Real Estate Ventures is as follows (in thousands):

								Company’s Share
						Real Estate		of Real Estate			Current
	Ownership			Carrying		Venture		Venture			Interest			Debt
	Percentage (1)			Amount		Debt at 100%		Income (Loss)			Rate			Maturity

Two Tower Bridge Associates		35	%	$	2,409	$	10,501	$	290			6.82	%		May-08
Four Tower Bridge Associates		65	%		2,454		11,000		(21	)		6.62	%		Feb-11
Five Tower Bridge Associates		15	%		—		30,600		—			6.77	%		Feb-09
Six Tower Bridge Associates		65	%		113		15,683		(46	)		7.79	%		Aug-12
Eight Tower Bridge Associates		6	%		1,147		38,219		(189	)		3.34	%		Feb-05
Tower Bridge Inn Associates		50	%		2,291		11,547		(235	)		8.50	%		Apr-07
1000 Chesterbrook Boulevard		50	%		3,373		27,860		456			6.88	%		Nov-11
PJP Building Two, LC		30	%		15		5,738		30			6.12	%		Nov-23
PJP Building Five, LC		25	%		238		5,753		94			2.69	%		Oct-05
Macquarie		20	%		3,813		74,500		64			4.62	%		Jan-09
Florig, LP (2)		30	%		—		—		(861	)		N/A			N/A
Invesco Partnership, L.P. (3)		35	%		—		—		470			N/A			N/A

				$	15,853	$	231,401	$	52

(1)	Ownership percentage represents our entitlement to residual distributions after payments of priority returns.

(2)	During 2003, the Company recorded an impairment charge of $861,000 associated with this non-operating real estate venture. This amount consisted primarily of legal and acquisition costs related to a parcel of land that ultimately was not acquired.

(3)	Our interest consists solely of a residual profits interest.

Item 3. Legal Proceedings

We are involved from time to time in litigation on various matters, which include disputes with tenants and disputes arising out of agreements to purchase or sell properties. Given the nature of our business activities, these lawsuits are considered routine to the conduct of its business. The result of any particular lawsuit cannot be predicted, because of the very nature of litigation, the litigation process and its adversarial nature, and the jury system.

As we have reported in our prior Annual Report on Form 10-K, we are a defendant in a case in which the plaintiffs allege that we breached our obligation to purchase a portfolio of properties for approximately $83.0 million. On July 9, 1999, the Superior Court of New Jersey, Camden County, dismissed the complaint against us with prejudice. Plaintiffs subsequently filed a motion for reconsideration, which motion the Superior Court denied. Plaintiffs then appealed to the Appellate Division, which is the intermediate appellate level court in New Jersey. In December 2000, the Appellate Division affirmed in part and reversed in part the Chancery Division’s earlier dismissal of the entire action. The Appellate Division affirmed the dismissal of the non-contractual counts in the Complaint, but reversed the contract and reformation counts and remanded these to the lower court for further proceedings. We sought review of this decision by the Supreme Court of New Jersey, but that Court declined to consider the appeal. The case thereafter returned to the Chancery Division, where written and oral discovery was conducted in 2002 and in the first quarter of 2003. Discovery terminated on February 14, 2003. We filed a motion for summary judgment seeking dismissal of all counts against us, and judgment for us on our counterclaim. The Chancery Division granted our summary judgment motion on March 25, 2003 and dismissed the case with prejudice. Plaintiffs appealed the judgment in our favor, and we do not know whether plaintiffs will be successful in their appeal.

There have been recent reports of lawsuits against owners and managers of multifamily and office properties asserting claims of personal injury and property damage caused by the presence of mold in residential units or office space. We have been named as a defendant in two lawsuits that allege personal injury as a result of the presence of mold. Unspecified damages are sought. We have referred these lawsuits to our environmental insurance carrier and, as of the date of this Form 10-K, the insurance carrier is tendering a defense to these claims.

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

We did not submit any matters to a vote of security holders in the fourth quarter of the fiscal year ended December 31, 2003.

PART II

Item 5. Market for Registrant’s Common Equity and Related Shareholder Matters and Issuer Purchases of Equity Securities

Our Common Shares are traded on the New York Stock Exchange (“NYSE”) under the symbol “BDN.” On March 10, 2004, there were 373 holders of record of our Common Shares. On March 10, 2004, the last reported sales price of the Common Shares on the NYSE was $28.88. The following table sets forth the quarterly high and low closing sales price per share reported on the NYSE for the indicated periods and the distributions paid by us with respect to each such period.

					Distributions
	Share Price		Share Price		Declared For
	High		Low		Quarter

First Quarter 2002	$	23.90	$	20.24	$	0.44
Second Quarter 2002	$	26.00	$	22.91	$	0.44
Third Quarter 2002	$	24.96	$	20.20	$	0.44
Fourth Quarter 2002	$	22.57	$	19.08	$	0.44

First Quarter 2003	$	22.00	$	19.32	$	0.44
Second Quarter 2003	$	24.84	$	21.00	$	0.44
Third Quarter 2003	$	25.72	$	23.87	$	0.44
Fourth Quarter 2003	$	27.74	$	24.63	$	0.44

Future distributions by us will be declared at the discretion of the Board of Trustees and will depend on our actual cash flow, our financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the Internal Revenue Code of 1986 and such other factors as our Board of Trustees deems relevant.

During 2003 and through the date of this Annual Report on Form 10-K, we did not issue any securities that were not registered under the Securities Act of 1993.

The following table provides information as of December 31, 2003 with respect to compensation plans under which our equity securities are authorized for issuance:

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Equity Compensation Plan Information as of December 31, 2003

	(a)	(b)	(c)

Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights	Weighted-average exercise price of outstanding options, warrants and rights	Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))

Equity compensation plans approved by security holders (1)	2,773,444	$26.70 (2)	1,265,045

Equity compensation plans not approved by security holders	—	—	—

Total	2,773,444	$26.70 (2)	1,265,045

(1)	Relates to our 1997 Long-Term Incentive Plan.

(2)	Weighted-average exercise price of outstanding options; excludes restricted Common Shares.

During the quarter ended December 31, 2003, we did not purchase any of our outstanding equity securities.

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Item 6. Selected Financial Data

(in thousands, except per Common Share data and number of properties)

Year Ended December 31,	2003			2002			2001			2000(A)			1999(A)

Operating Results
Total revenue	$	305,659		$	291,040		$	270,488		$	254,100		$	247,480
Net income		85,809			62,984			33,722			52,158			34,606
Income allocated to Common Shares		53,305			51,078			21,816			40,252			29,816
Earnings per Common Share
Basic	$	1.40		$	1.40		$	0.57		$	1.12		$	0.80
Diluted	$	1.40		$	1.39		$	0.57		$	1.12		$	0.80
Cash distributions declared per Common Share	$	1.76		$	1.76		$	1.70		$	1.62		$	1.57
Balance Sheet Data
Real estate investments, net of accumulated depreciation	$	1,695,355		$	1,745,981		$	1,812,909		$	1,674,341		$	1,702,353
Total assets		1,855,776			1,919,288			1,960,203			1,821,103			1,825,276
Total indebtedness		867,659			1,004,729			1,009,165			866,202			839,634
Total liabilities		950,431			1,097,793			1,108,213			923,961			895,083
Minority interest		134,357			135,052			143,834			144,974			145,941
Beneficiaries’ equity		770,988			686,443			708,156			752,168			784,252
Other Data
Cash flows from:
Operating activities		118,793			128,836			152,040			103,123			81,495
Investing activities		(34,068	)		5,038			(123,682	)		(32,372	)		69,195
Financing activities		(102,974	)		(120,532	)		(30,939	)		(60,403	)		(158,073	)
Property Data
Number of properties owned at year end		234			238			270			250			251
Net rentable square feet owned at year end		15,733			16,052			17,312			16,471			16,607


	(A) In 2000, the Operating Partnership held a 95% economic interest in Brandywine Realty Services Corporation (the “Management Company”) through its ownership of 100% of the Management Company’s non-voting preferred stock and 5% of its voting common stock. Effective January 1, 2001, the Company converted its non-voting equity interest in the Management Company to a voting interest. Accordingly, the Company owns 95% of the equity of and has voting control over the Management Company. Therefore, the 2003, 2002 and 2001 financial results of the Management Company have been consolidated. For purposes of the Selected Financial Data, the 2000 and 1999 results of operations presented above have been restated to reflect this presentation.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the financial statements appearing elsewhere herein. The results of operations and cash flows of the Company include the historical results of operations of the Properties held by the Company during the years ended December 31, 2003, 2002 and 2001. This Annual Report on Form 10-K contains forward-looking statements for purposes of the Securities Act of 1933 and the Securities Exchange Act of 1934 and as such may involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, there can be no assurance that these expectations will be realized. See Item 1. Business — Risk Factors.

OVERVIEW

The Company currently manages its portfolio within three geographic segments: (1) Pennsylvania, (2) New Jersey and (3) Virginia. The Company believes it has established an effective platform in these office and industrial markets that provides a foundation for achieving its goals of maximizing market penetration and optimizing operating economies of scale.

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aggregate of $45.6 million. In December 2003, the Company sold two office properties containing an aggregate of approximately 633,000 net rentable square feet for an aggregate of $112.8 million, of which $52.9 million of proceeds were used to pay off existing mortgage notes payable secured by the two properties. The Company retained a 20% interest in a venture that purchased the properties. The Company recognized a gain on the partial sale of approximately $18.5 million for the piece sold and deferred the gain on the piece retained. The Company also purchased five office properties containing approximately 360,000 net rentable square feet and one parcel of land containing approximately 10.0 acres for an aggregate of $67.8 million.

The Company receives income primarily from rental revenue (including tenant reimbursements) from the Properties and, to a lesser extent, from the management of properties owned by third parties and from investments in the Real Estate Ventures.

The Company’s financial performance is dependent upon the demand for office and other commercial space in its markets. Current economic conditions, including recessionary pressures and capital market volatility, have enhanced the challenges facing the Company.

In the current economic climate, the Company continues to seek revenue growth through an increase in occupancy of its portfolio (90.7% at December 31, 2003). However, with a downturn in general leasing activity, owners of commercial real estate, including the Company, are experiencing longer periods in which to lease unoccupied space, and may face higher capital costs and leasing commissions to achieve targeted tenancies.

As the Company seeks to increase revenue, management also focuses on strategies to minimize operating risks, including (i) tenant rollover risk, (ii) tenant credit risk and (iii) development risk.

Tenant Rollover Risk:

The Company is subject to the risk that, upon expiration, leases may not be renewed, the space may not be relet, or the terms of renewal or reletting (including the cost of renovations) may be less favorable than the current lease terms. Leases accounting for approximately 10.8% of the aggregate annualized base rents from the Properties as of December 31, 2003 (representing approximately 11.6% of the net rentable square feet of the Properties) expire without penalty in 2004. The Company maintains an active dialogue with its tenants in an effort to achieve a high level of lease renewals. The Company’s retention rate for leases that were scheduled to expire in the year ended December 31, 2003 was 80.2%. If the Company is unable to renew leases for a substantial portion of the space under expiring leases, or to promptly relet this space, at anticipated rental rates, the Company’s cash flow could be adversely impacted.

Tenant Credit Risk:

In the event of a tenant default, the Company may experience delays in enforcing its rights as a landlord and may incur substantial costs in protecting its investment. Management regularly evaluates its accounts receivable reserve policy in light of its tenant base and general and local economic conditions. The accounts receivable allowance was $4.0 million or 11.2% of total receivables (including accrued rent receivable) as of December 31, 2003 compared to $4.6 million or 12.5% of total receivables (including accrued rent receivable) as of December 31, 2002.

Development Risk:

The Company currently has in development or redevelopment seven sites aggregating approximately 1.1 million square feet. The total cost of these projects is estimated to be $225.5 million, of which $17.9 million was incurred as of December 31, 2003. While the Company is actively marketing space at these projects to prospective tenants, management cannot provide assurance as to the timing or terms of any leases of such space. As of December 31, 2003, the Company owned approximately 445 acres of undeveloped land and held options to purchase approximately 61 additional acres. Risks associated with development of this land include construction cost overruns and construction delays, insufficient occupancy rates and inability to obtain necessary zoning, land-use, building, occupancy and other required governmental approvals.

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CRITICAL ACCOUNTING POLICIES

Management’s Discussion and Analysis of Financial Condition and Results of Operations discusses the Company’s consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

The Company’s significant accounting policies are described in Note 2 to the consolidated financial statements included this Annual Report on Form 10-K. While the estimates and judgments associated with the application of these accounting policies may be affected by different assumptions or conditions, the Company believes the estimates and judgments associated with the reported amounts are appropriate in the circumstances. The following identifies critical accounting policies that are used in preparing the Company’s consolidated financial statements, including those policies which require significant judgment and estimates:

Revenue Recognition

Rental revenue is recognized on a straight-line basis over the lease term regardless of when payments are due. Certain lease agreements contain provisions that require tenants to reimburse a pro rata share of real estate taxes and common area maintenance costs.

Real Estate Investments

Real estate investments are carried at cost. The Company records acquisition of real estate investments under the purchase method of accounting and allocates the purchase price to land, buildings and intangible assets on a relative fair value basis. Depreciation is computed using the straight-line method over the useful lives of buildings and capital improvements (25 to 40 years) and over the shorter of the lease term or the life of the asset for tenant improvements. Direct construction costs related to the development of Properties and land holdings are capitalized as incurred. The Company expenses routine repair and maintenance expenditures.

Impairment of Long-Lived Assets

Management reviews investments in real estate and real estate ventures for impairment if facts and circumstances indicate that the carrying value of such assets may not be recoverable. Measurement of any impairment loss will be based on the fair value of the asset, determined using customary valuation techniques, such as the present value of expected future cash flows.

In accordance with SFAS No. 144 (“SFAS 144”), Accounting for the Impairment or Disposal of Long-Lived Assets, long-lived assets, such as real estate investments and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of would be separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated. The assets and liabilities relating to assets classified as held-for-sale would be presented separately in the appropriate asset and liability sections of the balance sheet.

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Income Taxes

The Company may elect to treat one or more of its corporate subsidiaries as a taxable REIT subsidiary (“TRS”). In general, a TRS of the Company may perform additional services for tenants of the Company and generally may engage in any real estate or non-real estate related business (except for the operation or management of health care facilities or lodging facilities or the providing to any person, under a franchise, license or otherwise, rights to any brand name under which any lodging facility or health care facility is operated). A TRS is subject to corporate federal income tax. The Company has elected to treat certain of its corporate subsidiaries as a TRS. If the Company fails to qualify as a REIT in any taxable year, the Company will be subject to federal income tax (including any applicable alternative minimum tax) on its taxable income at regular corporate tax rates.

Allowance for Doubtful Accounts

The Company maintains an allowance for doubtful accounts that represents an estimate of losses that may be incurred from the inability of tenants to make required payments. The allowance is an estimate based on two calculations that are combined to determine the total amount reserved. First, the Company evaluates specific accounts where it has been determined that a tenant may have an inability to meet its financial obligations. In these situations, the Company uses its judgment, based on the facts and circumstances, and records a specific reserve for that tenant against amounts due to reduce the receivable to the amount that the Company expects to collect. These reserves are reevaluated and adjusted as additional information becomes available. Second, a reserve is established for all tenants based on a range of percentages applied to aging categories. These percentages are based on historical collection and write-off experience. If the financial condition of the Company’s tenants were to deteriorate, additional allowances may be required.

Deferred Costs

The Company incurs direct costs related to the financing, development and leasing of the Properties. Management exercises judgment in determining whether such costs meet the criteria for capitalization or must be expensed. Capitalized financing fees are amortized over the related loan term and capitalized leasing costs are amortized over the related lease term. Management re-evaluates the remaining useful lives of leasing costs as the creditworthiness of the Company’s tenants and economic and market conditions change.

Purchase Price Allocation

The Company allocates the purchase price of properties to net tangible and identified intangible assets acquired based on fair values. Above-market and below-market in-place lease values for acquired properties are recorded based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) the Company’s estimate of the fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining non-cancellable term of the lease. Capitalized above-market lease values are amortized as a reduction of rental income over the remaining non-cancellable terms of the respective leases. Capitalized below-market lease values amortized as an increase of rental income over the remaining non-cancellable terms of the respective leases, including any fixed-rate renewal periods.

The aggregate value of other intangibles acquired is measured based on the difference between (i) the property valued with in-place leases adjusted to market rental rates and (ii) the property valued as if it was vacant. The Company allocates a portion of the purchase price to lease origination costs. The Company estimates the cost to execute leases with terms similar to the remaining lease terms of the in-place leases, include leasing commissions, legal and other related expenses. This intangible asset is amortized to expense over the remaining term of the respective leases. Company estimates of value are made using methods similar to those used by independent appraisers. Factors considered by the Company in their analysis include an estimate of the carrying costs during the expected lease-up periods considering current market conditions and costs to execute similar leases. The Company also considers information obtained about each property as a result of its pre-acquisition due diligence, marketing and leasing activities in estimating the fair value of the tangible and intangible assets acquired. In estimating carrying costs, the Company includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up periods, which primarily range from three to twelve months.

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The total amount of these other intangible assets is further allocated to tenant relationships and in-place leases based on the Company’s evaluation of the specific characteristics of each tenant’s lease and the Company’s overall relationship with the respective tenant. Characteristics considered by the Company in allocating value to its tenant relationships include the nature and extent of the Company’s business relationship with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals, among other factors. The value of tenant relationship intangibles is amortized over the remaining initial lease term and renewals, but in no event longer than the remaining depreciable life of the building. The value of in-place leases is amortized over the remaining non-cancellable term of the respective leases and any fixed-rate renewal periods.

In the event that a tenant terminates its lease, the unamortized portion of each intangible, including market rate adjustments, lease origination costs, in-place lease values and tenant relationship values, would be charged to expense.

RESULTS OF OPERATIONS

Comparison of the Year Ended December 31, 2003 to the Year Ended December 31, 2002

	Year Ended December 31,						Dollar			Percent
	2003			2002			Change			Change

	(amounts in thousands)
Revenue:
Rents	$	256,945		$	248,075		$	8,870			3.6%
Tenant reimbursements		37,755			33,263			4,492			13.5%
Other		10,959			9,702			1,257			13.0%

Total revenue		305,659			291,040			14,619			5.0%

Operating Expenses:
Property operating expenses		80,817			74,967			5,850			7.8%
Real estate taxes		27,919			25,196			2,723			10.8%
Interest		57,835			63,522			(5,687	)		-9.0%
Depreciation and amortization		60,592			56,431			4,161			7.4%
Administrative expenses		14,464			14,804			(340	)		-2.3%

Total operating expenses		241,627			234,920			6,707			2.9%

Income from continuing operations before equity in income of real estate ventures, net gain on sales and minority interest		64,032			56,120			7,912			14.1%
Equity in income of real estate ventures		52			987			(935	)		-94.7%

Income from continuing operations before net gain on sales and minority interest		64,084			57,107			6,977			12.2%
Net gain on sales of interest in real estate		20,537			—			20,537			—
Minority interest		(10,141	)		(9,265	)		(876	)		-9.5%

Income from continuing operations		74,480			47,842			26,638			55.7%
Income from discontinued operations, net of minority interest		11,329			15,142			(3,813	)		-25.2%

Net income	$	85,809		$	62,984		$	22,825			36.2%

The results of operations for the years ended December 31, 2003 and 2002 include the respective operations of the Properties. Of the 234 Properties owned by the Company as of December 31, 2003, a total of 211 Properties containing an aggregate of approximately 13.6 million net rentable square feet (“Same Store Properties”) were owned for the entire twelve-month periods ended December 31, 2003 and 2002. The following table set forth revenue and expense information as to these Same Store Properties for the twelve-month periods ended December 31, 2003 and 2002:

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	Year Ended December 31,				Dollar			Percent
	2003		2002		Change			Change

	(amounts in thousands)
Revenue:
Rents	$	214,778	$	213,169	$	1,609			0.8	%
Tenant reimbursements		29,600		26,319		3,281			12.5	%
Other		2,585		2,777		(192	)		-6.9	%

Total revenue		246,963		242,265		4,698			1.9	%
Operating Expenses:
Property operating expenses		75,255		69,662		5,593			8.0	%
Real estate taxes		22,866		21,612		1,254			5.8	%

Total operating expenses		98,121		91,274		6,847			7.5	%

Property NOI	$	148,842	$	150,991	$	(2,149	)		-1.4	%

The following table is a reconciliation of income from continuing operations to Same Store net operating income:

	Year ended December 31,
	2003			2002

	(amounts in thousands)
Income from continuing operations	$	74,480		$	47,842
Add/(deduct):
Interest expense		57,835			63,522
Depreciation and amortization		60,592			56,431
Administrative expenses		14,464			14,804
Equity in income of Real Estate Ventures		(52	)		(987	)
Net gain on sale of interests in real estate		(20,537	)		—
Minority interest attributable to continuing operations		10,141			9,265

Consolidated net operating income		196,923			190,877
Less: Net operating income of non same store properties		(48,081	)		(39,886	)

Same Store net operating income	$	148,842		$	150,991

Management generally considers Same Store net operating income a useful financial measure because the results of the Same Store Properties are directly comparable period to period. Same Store net operating income is a non-GAAP financial measure and does not represent income from continuing operations because it does not reflect the consolidated operations of the Company.

Revenue increased to $305.7 million for 2003 as compared to $291.0 million for 2002, primarily due to increased rental rates and additional properties in 2003, offset by decreased occupancy. The straight-line rent adjustment increased revenues by $5.9 million in 2003 and $5.8 million in 2002. Revenue for Same Store Properties increased to $247.0 million in 2003 from $242.3 million in 2002. This increase was the result of increased occupancy as well as increased tenant reimbursements from higher operating expenses in 2003 as compared to 2002. Average occupancy for the Same Store Properties increased to 91.0% in 2003 from 90.9% in 2002. Other revenue represents lease termination fees, bankruptcy settlement proceeds, leasing commissions, third-party management fees and interest income. Other revenue increased to $11.0 million in 2003 from $9.7 million in 2002 primarily due to bankruptcy settlement proceeds received in 2003.

Property operating expenses increased to $80.8 million in 2003 as compared to $75.0 million in 2002, primarily due to increased snow removal costs and additional properties in 2003. Property operating expenses included a provision for doubtful accounts of $.2 million in 2003 and $.9 million in 2002 to provide for increased tenant credit risk. Property operating expenses for the Same Store Properties increased to $75.3 million in 2003 as compared to $69.7 million in 2002 as a result of increased snow removal costs in 2003 as compared to 2002.

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Real estate taxes increased to $27.9 million in 2003 as compared to $25.2 million in 2002, primarily due to increased real estate tax assessments in 2003 and additional properties in 2003. Real estate taxes for the Same Store Properties increased to $22.9 million in 2003 as compared to $21.6 million in 2002 as a result of higher tax rates and property assessments.

Interest expense decreased to $57.8 million in 2003 as compared to $63.5 million in 2002, primarily due to decreased interest rates and decreased average borrowings during 2003. Average outstanding debt balances for 2003 were $948.7 million as compared to $1.0 billion for 2002. The Company’s weighted-average interest rate from its unsecured credit facilities after giving effect to hedging activities on the unsecured credit facilities decreased to 4.60% in 2003 from 5.41% in 2002 and on mortgage notes payable decreased to 7.09% in 2003 from 7.27% in 2002.

Depreciation increased to $53.5 million in 2003 as compared to $50.8 million in 2002 primarily due to additional properties in 2003 and additional depreciation from increased tenant improvements during 2003. Amortization, related to deferred leasing costs, increased to $7.1 million in 2003 as compared to $5.6 million in 2002, primarily due to increased leasing activity and additional properties in 2003.

Administrative expenses decreased to $14.5 million in 2003 as compared to $14.8 million in 2002, primarily due to decreased amortization of restricted stock.

Equity in income of Real Estate Ventures decreased to $52,000 in 2003 as compared to $1.0 million in 2002. During 2003, the Company recorded an impairment charge of $861,000 associated with the write-down its investment in a non-operating joint venture.

During 2003, the Company sold four parcels of land containing an aggregate of 24.1 acres for an aggregate of $4.2 million, realizing an aggregate gain of $2.0 million. In addition, the Company sold two office properties containing an aggregate of approximately 633,000 net rentable square feet for an aggregate of $112.8 million, of which $52.9 million of proceeds were used to pay off existing mortgage notes payable secured by the two properties. The Company recognized a gain on the sale of approximately $18.5 million, which is recorded in net gain on sale of real estate interests due to a continuing 20% interest that the Company has maintained in the properties. During 2002, the Company sold two land parcels containing an aggregate of 12.8 acres for $.7 million with no net gain realized.

Minority interest from continuing operations represents the equity in income attributable to the portion of the Operating Partnership not owned by the Company. Minority interest from continuing operations increased to $10.1 million in 2003 as compared to $9.3 million in 2002, primarily due to increased results of continuing operations in 2003 as compared to 2002.

Discontinued operations decreased to $11.3 million in 2003 as compared to $15.1 million in 2002 primarily due to net gain on sales of real estate investments of $8.6 million in 2002. During 2003, the Company sold eight office properties containing an aggregate of 343,000 net rentable square feet and two industrial properties containing an aggregate of 131,000 net rentable square feet for an aggregate of $41.4 million, realizing an aggregate gain of $9.7 million. During 2002, the Company sold 23 office properties containing an aggregate of 1.4 million net rentable square feet and 20 industrial properties containing an aggregate of .9 million net rentable square feet for an aggregate of $190.1 million, realizing a net gain of $8.6 million. The Company also recorded an impairment loss in 2002 of $665,000 related to one property held-for-sale for which the anticipated net sales price is less than the book value of the asset.

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Comparison of the Year Ended December 31, 2002 to the Year Ended December 31, 2001

	Year Ended December 31,						Dollar			Percent
	2002			2001			Change			Change

	(amounts in thousands)
Revenue:
Rents	$	248,075		$	228,149		$	19,926			8.7	%
Tenant reimbursements		33,263			31,993			1,270			4.0	%
Other		9,702			10,346			(644	)		-6.2	%

Total revenue		291,040			270,488			20,552			7.6	%
Operating Expenses:
Property operating expenses		74,967			70,604			4,363			6.2	%
Real estate taxes		25,196			22,435			2,761			12.3	%
Interest		63,522			67,496			(3,974	)		-5.9	%
Depreciation and amortization		56,431			67,224			(10,793	)		-16.1	%
Administrative expenses		14,804			15,177			(373	)		-2.5	%
Non-recurring charges		—			6,600			(6,600	)		—

Total operating expenses		234,920			249,536			(14,616	)		-5.9	%

Income from continuing operations before equity in
income of real estate ventures, net gain on sales
and minority interest		56,120			20,952			35,168			167.9	%
Equity in income of real estate ventures		987			2,768			(1,781	)		-64.3	%

Income from continuing operations before net gain
on sales and minority interest		57,107			23,720			33,387			140.8	%
Net gain on sales of interest in real estate		—			4,524			(4,524	)		-100.0	%
Minority interest		(9,265	)		(7,818	)		(1,447	)		-18.5	%

Income from continuing operations		47,842			20,426			27,416			134.2	%
Income from discontinued operations, net of
minority interest		15,142			13,296			1,846			13.9	%

Net income	$	62,984		$	33,722		$	29,262			86.8	%

The results of operations for the years ended December 31, 2002 and 2001 include the respective operations of the Properties. Of the 238 Properties owned by the Company as of December 31, 2002, a total of 194 Properties containing an aggregate of 13.2 million net rentable square feet (“Same Store Properties”) were owned for the entire twelve-month periods ended December 31, 2002 and 2001. The following table set forth revenue and expense information as to these Same Store Properties for the twelve-month periods ended December 31, 2002 and 2001:

	Year Ended December 31,				Dollar			Percent
	2002		2001		Change			Change

	(amounts in thousands)
Revenue:
Rents	$	203,365	$	207,071	$	(3,706	)		-1.8	%
Tenant reimbursements		29,324		29,143		181			0.6	%
Other		615		427		188			44.0	%

Total revenue		233,304		236,641		(3,337	)		-1.4	%
Operating Expenses:
Property operating expenses		71,246		69,876		1,370			2.0	%
Real estate taxes		21,909		20,779		1,130			5.4	%

Total operating expenses		93,155		90,655		2,500			2.8	%

Property NOI	$	140,149	$	145,986	$	(5,837	)		-4.0	%

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The following table is a reconciliation of income from continuing operations to Same Store net operating income:

	Year ended December 31,
	2002			2001

	(amounts in thousands)
Income from continuing operations	$	47,842		$	20,426
Add/(deduct):
Interest expense		63,522			67,496
Depreciation and amortization		56,431			67,224
Administrative expenses		14,804			15,177
Non-recurring charge		—			6,600
Equity in income of Real Estate Ventures		(987	)		(2,768	)
Net gain on sale of interests in real estate		—			(4,524	)
Minority interest attributable to continuing operations		9,265			7,818

Consolidated net operating income		190,877			177,449
Less: Net operating income of non same store properties		(50,728	)		(31,463	)

Same Store net operating income	$	140,149		$	145,986

Revenue increased to $291.0 million for 2002 as compared to $270.5 million for 2001, primarily due to increased rental rates and additional properties in 2002, offset by decreased occupancy. The straight-line rent adjustment increased revenues by $5.8 million in 2002 and $5.4 million in 2001. Revenue for Same Store Properties decreased to $233.3 million in 2002 from $236.6 million in 2001. This decrease was the result of decreased occupancy in 2002 as compared to 2001. Average occupancy for the Same Store Properties decreased to 90.4% in 2002 from 94.5% in 2001. Other revenue represents lease termination fees, leasing commissions, third-party management fees and interest income. Other revenue decreased to $9.7 million in 2002 from $10.3 million in 2001 primarily due to reduced interest income earned in 2002 as compared to 2001.

Property operating expenses increased to $75.0 million in 2002 as compared to $70.6 million in 2001, primarily due to increased insurance and security costs and additional properties in 2002. Property operating expenses included a provision for doubtful accounts of $.9 million in 2002 and $2.9 million in 2001 to provide for increased tenant credit risk. Property operating expenses for the Same Store Properties increased to $71.2 million in 2002 as compared to $69.9 million in 2002 as a result of higher insurance and security costs.

Real estate taxes increased to $25.2 million in 2002 as compared to $22.4 million in 2001, primarily due to increased real estate tax assessments in 2002 and additional properties in 2002. Real estate taxes for the Same Store Properties increased to $21.9 million in 2002 as compared to $20.8 million in 2001 as a result of higher tax rates and property assessments.

Interest expense decreased to $63.5 million in 2002 as compared to $67.5 million in 2001, primarily due to decreased interest rates, partially offset by increased average borrowings during 2002. Average outstanding debt balances for 2002 were $1.0 billion as compared to $949.5 million for 2001. The Company’s weighted-average interest rate on its unsecured credit facilities after giving effect to hedging activities on the unsecured credit facilities decreased to 5.41% in 2002 from 6.48% in 2001 and on its mortgage notes payable decreased to 7.27% in 2002 from 7.39% in 2001.

Depreciation decreased to $50.8 million in 2002 as compared to $62.9 million in 2001 primarily due to a change made by the Company in the estimated useful lives of buildings from 25 to 40 years. The impact of this change in useful lives was $19.0 million or $.53 per share for the year ended December 31, 2002. Management determined that the longer period better reflected the useful lives of the buildings. Amortization, related to deferred leasing costs, increased to $5.6 million in 2002 as compared to $4.3 million in 2001, primarily due to increased leasing activity and additional properties in 2002.

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Administrative expenses decreased to $14.8 million in 2002 as compared to $15.2 million in 2001, primarily due to decreased amortization of restricted stock.

Equity in income of Real Estate Ventures decreased to $1.0 million in 2002 as compared to $2.8 million in 2001. The 2001 results include a $785,000 gain on the sale of the Company’s interests in a Real Estate Venture. In addition, the Company acquired the remaining partnership interests in three Real Estate Ventures, and, accordingly, the results attributable to these properties are now consolidated from the date of acquisition.

During 2002, the Company sold two land parcels containing an aggregate of 12.8 acres for $.7 million with no net gain realized. During 2001, the Company sold three office properties, eight industrial properties and four land parcels for $31.3 million, realizing a net gain of $4.5 million.

Minority interest from continuing operations represents the equity in income attributable to the portion of the Operating Partnership not owned by the Company. Minority interest from continuing operations increased to $9.3 million in 2002 as compared to $7.9 million in 2001, primarily due to increased results of continuing operations in 2002 as compared to 2001.

Discontinued operations increased to $15.1 million in 2002 from $13.3 million in 2001 primarily due to net gain on sales of real estate investments of $8.6 million in 2002. During 2002, the Company sold 23 office properties containing an aggregate of 1.4 million net rentable square feet and 20 industrial properties containing an aggregate of .9 million net rentable square feet for an aggregate of $190.1 million, realizing a net gain of $8.6 million. The Company also recorded an impairment loss in 2002 of $665,000 related to one property held-for-sale for which the anticipated net sales price was less than the book value of the asset.

LIQUIDITY AND CAPITAL RESOURCES

Cash Flows

During 2003, the Company generated $118.8 million in cash flow from operating activities. Other sources of cash in-flows consisted of: (i) $220.0 million of proceeds from the Term Loan and draws on the Credit Facility, (ii) $159.1 million in net proceeds from share issuances, (iii) $87.5 million of net proceeds from property sales, (iv) $3.3 million of cash distributions from Real Estate Ventures, (v) $2.5 million from payments on employee loans and (vi) $1.9 million of escrowed cash. During 2003, cash out-flows consisted of: (i) $222.0 million of Credit Facility repayments, (ii) $91.4 million of Preferred Share redemptions, including $1.2 million of related warrant repurchases, (iii) $82.1 million of mortgage note repayments, (iv) $78.8 million of distributions to shareholders, (v) $67.5 million for property acquisitions, (vi) $50.9 million to fund capital expenditures, (vii) $10.2 million of distributions to minority interest holders, (viii) $7.8 million of leasing costs, (ix) $.5 million of additional investment in Real Estate Ventures and (x) $.1 million of debt costs.

During 2002, the Company generated $128.8 million in cash flow from operating activities. Other sources of cash in-flows consisted of: (i) $115.0 million of proceeds from the Term Loan and draws on the Credit Facility, (ii) $78.0 million of net proceeds from property sales, (iii) proceeds from $20.2 million of additional mortgage notes payable, (iv) $2.6 million of escrowed cash, (v) $2.0 million of cash distributions from Real Estate Ventures and (vi) $1.7 million from payments on employee loans. During 2002, cash out-flows consisted of: (i) $102.3 million of Credit Facility repayments, (ii) $75.0 million of distributions to shareholders, (iii) $48.6 million of mortgage note repayments, (iv) $38.8 million to fund capital expenditures, (v) $25.1 million for property acquisitions, (vi) $20.2 million to repurchase Common Shares and minority interest units in the Operating Partnership, (vii) $13.1 million of leasing costs, (viii) $10.6 million of distributions to minority interest holders, (ix) $.7 million of debt costs and (x) $.4 million of additional investment in Real Estate Ventures.

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During 2001, the Company generated $152.0 million in cash flow from operating activities. Other sources of cash in-flows consisted of: (i) proceeds from $135.2 million of additional mortgage notes payable, (ii) $91.0 million of proceeds from draws on the Credit Facility, (iii) $31.3 million of net proceeds from property sales, (iv) $5.5 million of cash distributions from Real Estate Ventures and (v) $1.0 million from payments on employee loans. During 2001, cash out-flows consisted of: (i) $127.9 million of mortgage note repayments, (ii) $107.4 million to fund capital expenditures, (iii) $72.5 million of distributions to shareholders, (iv) $40.4 million for property acquisitions, (v) $35.0 million to repay borrowings under the Credit Facility, (vi) $10.7 million of distributions to minority interest holders, (vii) $9.2 million of leasing costs, (viii) $6.5 million to repurchase Common Shares and minority interest units in the Operating Partnership, (ix) $5.6 million of debt costs, (x) $2.5 million of additional investment in Real Estate Ventures and (xi) $1.0 million of escrowed cash.

Capitalization

At December 31, 2003, the Company maintained a $500 million Credit Facility. (See Item 1. Business-Credit Facility)

As of December 31, 2003, the Company had approximately $867.7 million of debt outstanding, consisting of $305.0 million of borrowings under the Credit Facility, $100 million of borrowings under the Term Loan and $462.7 million of mortgage notes payable. The mortgage notes payable consists of $402.3 million of fixed rate loans and $60.4 million of variable rate loans. Additionally, the Company has entered into interest rate swap agreements to fix the interest rate on $175 million of the Credit Facility. The mortgage loans mature between March 2004 and July 2027. As of December 31, 2003, the Company also had $10.7 million of letters of credit outstanding under the Credit Facility and $184.3 million of unused availability under the Credit Facility. For the year ended December 31, 2003, the weighted-average interest rate under the Credit Facility and the related swap agreements was 4.60%, the weighted-average interest rate for the Term Loan was 2.95% and the weighted-average interest rate for borrowings under mortgage notes payable and the related cap agreements was 7.09%.

The following table outlines the timing of payment requirements related to the Company’s commitments as of December 31, 2003:

	Payments by Period (in thousands)

	Total		Less than 1 Year		1-3 Years		3-5 Years		More than 5 Years

Mortgage notes payable:
Fixed rate	$	402,321	$	10,277	$	24,759	$	40,259	$	327,026
Variable rate		24,815		172		407		552		23,684
Construction loans		35,523		35,523		—		—		—

		462,659		45,972		25,166		40,811		350,710
Revolving credit facility		305,000		305,000		—		—		—
Unsecured debt		100,000		—		100,000		—		—
Other liabilities		11,027		10,279		748		—		—

	$	878,686	$	361,251	$	125,914	$	40,811	$	350,710

The Company intends to refinance its mortgage notes payable as they become due or repay those that are secured by properties being sold. The Company expects to renegotiate its Credit Facility and Term Loan prior to maturity or extend their terms.

On January 12, 2004, we sold 2,645,000 Common Shares for net proceeds of approximately $69.3 million. We used the net proceeds to reduce the outstanding balance under our revolving credit facility.

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On March 3, 2004, we sold 1,840,000 Common Shares for net proceeds of approximately $50.7 million. We used the net proceeds to reduce the outstanding balance under our revolving credit facility.

As of December 31, 2003, the Company’s debt-to-market capitalization ratio was 40.5%. As a general policy, the Company intends, but is not obligated, to adhere to a policy of maintaining a long-term average debt-to-market capitalization ratio of no more than 50%.

The Company’s Board of Trustees approved a share repurchase program authorizing the Company to repurchase up to 4,000,000 of its outstanding Common Shares. Through December 31, 2003, the Company had repurchased 3.2 million of its Common Shares at an average price of $17.75 per share. Under the share repurchase program, the Company has the authority to repurchase an additional 762,000 shares. No time limit has been placed on the duration of the share repurchase program. The following table summarizes the share repurchases during the three years ended December 31, 2003:

	Years Ended December 31,
	2003		2002		2001

Repurchased amount (shares)		—		491,074		373,713
Repurchased amount ($, in thousands)	$	—	$	11,053	$	7,294
Average price per share	$	—	$	22.51	$	19.52

The following table summarized the Class A Units tendered for redemption during the three years ended December 31, 2003:

	Years Ended December 31,
	2003		2002		2001

Repurchased amount (units)		—		364,222		3,247
Repurchased amount ($, in thousands)	$	—	$	8,536	$	64
Average price per unit	$	—	$	23.44	$	19.72

Short- and Long-Term Liquidity

The Company believes that cash flow from operations and current financing alternatives are adequate to fund its short-term liquidity requirements for 2004. Cash flow from operations is generated primarily from rental revenues, operating expense reimbursements from tenants, and by providing management services to third parties. The Company intends to use these funds to meet its principal short-term liquidity needs, which are to fund operating expenses, debt service requirements, recurring capital expenditures, tenant allowances, leasing commissions and the minimum distributions required to maintain the Company’s REIT qualifications under the Internal Revenue Code.

On December 18, 2003, the Board of Trustees declared a quarterly dividend distribution of $0.44 per share, paid on January 15, 2004 to common shareholders of record as of December 31, 2003. Distributions of $1.76 per share were declared in 2003 and 2002.

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The Company expects to meet its long-term liquidity requirements, such as for property acquisitions, development, investments in real estate ventures, scheduled debt maturities, major renovations, expansions and other significant capital improvements, through borrowings under its Credit Facility, long-term secured and unsecured indebtedness, the issuance of equity securities and the disposition of certain properties.

Off-Balance Sheet Arrangements

The Company is not dependent on the use of any off-balance sheet financing arrangements for liquidity. The Company’s off-balance sheet arrangements are discussed in Note 6 to the financial statements: “Investment in Unconsolidated Real Estate Ventures”. Additional information about the debt of the Company’s unconsolidated Real Estate Ventures is included in “Item 2 — Properties”.

Inflation

A majority of the Company’s leases provide for escalations of real estate taxes and operating expenses either on a triple net basis or over a base amount. In addition, many of the office leases provide for fixed base rent increases. The Company believes that inflationary increases in expenses will be significantly offset by expense reimbursement and contractual rent increases.

Interest Rate Risk and Sensitivity Analysis

The analysis below presents the sensitivity of the market value of the Company’s financial instruments to selected changes in market rates. The range of changes chosen reflects the Company’s view of changes which are reasonably possible over a one-year period. Market values are the present value of projected future cash flows based on the market rates chosen.

The Company’s financial instruments consist of both fixed and variable rate debt. As of December 31, 2003, the Company’s consolidated debt consisted of $402.3 million in fixed rate mortgages and $60.4 million in variable rate mortgage notes, $305.0 million borrowings under its Credit Facility and $100.0 million under its Term Loan. All financial instruments were entered into for other than trading purposes and the net market value of these financial instruments is referred to as the net financial position. Changes in interest rates have different impacts on the fixed and variable rate portions of the Company’s debt portfolio. A change in interest rates on the fixed portion of the debt portfolio impacts the net financial instrument position, but has no impact on interest incurred or cash flows. A change in interest rates on the variable portion of the debt portfolio impacts the interest incurred and cash flows, but does not impact the net financial instrument position.

The Company has entered into interest rate swap and rate cap agreements designed to reduce the impact of interest rate changes on its variable rate debt. At December 31, 2003, the Company had interest rate swap agreements for notional principal amounts aggregating $175 million. The swap agreements effectively fix the LIBOR interest rate on $100 million of Credit Facility borrowings at 4.230% and on $75 million of Credit Facility borrowings at 4.215%, in each case until June 2004. The interest rate cap agreement effectively limits the interest rate on a mortgage with a notional value of $28 million at 8.7% until July 2004. The impact of the cap agreement is recorded as a component of interest expense.

If market rates of interest on our variable rate debt increase by 1%, the increase in annual interest expense on our variable rate debt would decrease future earnings and cash flows by approximately $3.8 million. If market rates of interest on our variable rate debt decrease by 1%, the decrease in interest expense on our variable rate debt would increase future earnings and cash flows by approximately $3.8 million. If market rates of interest increase by 1%, the fair value of our total outstanding debt would decrease by approximately $24.5 million. If market rates of interest decrease by 1%, the fair value of our total outstanding debt would increase by approximately $27.1 million.

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Item 7A. Quantitative and Qualitative Disclosure About Market Risk

See discussion in Management’s Discussion and Analysis included in Item 7 herein.

Item 8. Financial Statements and Supplementary Data

The financial statements and supplementary financial data are listed under Item 15(a) and filed as part of this Annual Report on Form 10-K. See Item 15.

PricewaterhouseCoopers LLP (“PWC”) is the Company’s independent public auditors. KPMG LLP (“KPMG”) provides the Company with tax compliance and advisory services. The Audit Committee of the Board of Trustees of the Company has approved the provision of services by PWC and KPMG to the Company. See Item 9.

Report of Management

The management of the Company is responsible for the preparation of the financial statements and related financial information included in this annual report. The statements were prepared in conformity with accounting principles generally accepted in the United States of America and, accordingly, include amounts that are based on informed estimates and judgments.

Management maintains a system of internal controls to provide reasonable assurance that assets are safeguarded and that transactions are properly authorized and accurately recorded. The concept of reasonable assurance is based on the recognition that there are inherent limitations in all systems of internal accounting control and that the costs of such systems should not exceed the benefits expected to be derived. The Company continually reviews and modifies these systems, where appropriate, to maintain such assurance. The system of internal controls includes careful selection, training and development of operating and financial personnel, well-defined organizational responsibilities and communication of Company policies and procedures throughout the organization.

The selection of the Company’s independent auditors, PWC, has been approved by the Audit Committee of the Board of Trustees. The Audit Committee of the Board of Trustees, comprised solely of non-employee Trustees, meets periodically with the Company’s independent auditors and management to review the financial statements and related information and to confirm that they are properly discharging their responsibilities. In addition, the independent auditors meet with the Audit Committee, without the presence of management, to discuss their findings and their observations on other relevant matters. Recommendations made by PWC are considered and appropriate action is taken to respond to these recommendations.

Gerard H. Sweeney, President and Chief Executive Officer
Christopher P. Marr, Senior Vice President and Chief Financial Officer
Bradley W. Harris, Vice President and Chief Accounting Officer *

* Mr. Harris’ employment with the Company terminates on March 12, 2004.

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Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

On May 23, 2002, the Company dismissed Arthur Andersen LLP (“Arthur Andersen”) as its independent public accountants and appointed KPMG LLP (“KPMG”) as its independent public accountants. The decision to dismiss Arthur Andersen and to retain KPMG was approved by the Audit Committee. Arthur Andersen’s reports on the Company’s consolidated financial statements as of and for the fiscal years ended December 31, 2001 and 2000 did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope, or accounting principles.

During the Company’s fiscal years ended December 31, 2001 and 2000, and the subsequent interim period through May 30, 2002, there were no disagreements between the Company and Arthur Andersen on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to Arthur Andersen’s satisfaction, would have caused them to make reference to the subject matter of the disagreement in connection with their reports.

None of the reportable events described under Item 304(a)(1)(v) of Regulation S-K occurred within the Company’s fiscal years ended December 31, 2001 and 2000 and the subsequent interim period through May 30, 2002.

A copy of Arthur Andersen’s letter dated May 30, 2002 with respect to certain of the above statements is attached as Exhibit 16 to the Company’s Form 8-K filed with the Securities and Exchange Commission on May 30, 2002.

During the Company’s fiscal years ended December 31, 2001 and 2000, and the subsequent interim period through May 30, 2002, neither the Company nor anyone acting on behalf of the Company consulted with KPMG regarding any of the matters or events set forth in Item 304(a)(2) of Regulation S-K.

On June 19, 2003, the Company informed KPMG that they would be dismissed effective as of June 19, 2003.

The audit report of KPMG on the Company’s consolidated financial statements for the years ended December 31, 2002 and 2001 did not contain an adverse opinion or a disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope or accounting principles, except that effective January 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. During its audit for the fiscal years ended December 31, 2002 and 2001, and for the subsequent interim period through June 25, 2003, (i) there were no disagreements with KPMG on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to KPMG’s satisfaction, would have caused KPMG to make reference to the subject matter of such disagreements in their reports, and (ii) there have been no reportable events as defined in Item 304(a)(1)(v) of Regulation S-K.

The Audit Committee authorized the dismissal of KPMG and appointment of PWC. The Company retained PWC as its independent accountants effective June 19, 2003.

During the Company’s fiscal years ended December 31, 2002 and 2001, and for the subsequent interim period through June 25, 2003, neither the Company nor anyone acting on behalf of the Company engaged PWC regarding any of the items described in Item 304(a)(2) of Regulation S-K.

A copy of KPMG’s letter dated June 25, 2003 with respect to certain of the above statements is attached as Exhibit 16.1 to the Company’s Form 8-K filed with the Securities and Exchange Commission on June 25, 2003.

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Item 9A. Controls and Procedures

The Company’s Chief Executive Officer and Chief Financial Officer, after evaluating the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this annual report, have concluded that the Company’s disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports that it files under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in rules and forms of the Securities and Exchange Commission.

PART III

Item 10. Trustees and Executive Officers of the Registrant

Incorporated herein by reference to the Company’s definitive proxy statement to be filed with respect to its Annual Meeting of Shareholders expected to be held on May 3, 2004.

The Company has adopted a code of ethics that applies to its employees, including its principal executive officer, principal financial officer and principal accounting officer. The Company has posted its code of ethics on its internet website at www.brandywinerealty.com.

Item 11. Executive Compensation

Incorporated herein by reference to the Company’s definitive proxy statement to be filed with respect to its Annual Meeting of Shareholders expected to be held on May 3, 2004.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters

Incorporated herein by reference to the Company’s definitive proxy statement to be filed with respect to its Annual Meeting of Shareholders expected to be held on May 3, 2004.

Item 13. Certain Relationships and Related Transactions

Incorporated herein by reference to the Company’s definitive proxy statement to be filed with respect to its Annual Meeting of Shareholders expected to be held on May 3, 2004.

Item 14. Principal Accountant Fees and Services

Audit Fees. Fees to PWC for audit services totaled approximately $413,000 in 2003, including fees associated with the annual audit, review of the Company’s quarterly reports on Form 10-Q and procedures relating to Company securities offerings. The Company did not pay PWC fees for audit services in 2002. Fees to KPMG for audit services totaled approximately $320,000 in 2003 and approximately $692,000 in 2002, including fees associated with the annual audit for 2002, review of the Company’s quarterly reports on Form 10-Q and procedures relating to Company securities offerings.

Audit-Related Fees. The Company did not pay either PWC or KPMG fees for audit-related services in 2003 or 2002.

Tax Fees. The Company did not pay PWC fees for tax services in 2003 or 2002. Fees to KPMG for tax services, including tax advice and tax planning, totaled approximately $267,000 in 2003 and $106,000 in 2002. Fees to KPMG for tax compliance services totaled approximately $162,000 in 2003 and $201,000 in 2002.

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All Other Fees. The Company did not pay other fees to PWC or KPMG for services provided to the Company in 2003 or 2002.

We have been advised by each of PWC and KPMG that neither the firm, nor any member of the firm, has any financial interest, direct or indirect, in any capacity in the Company or its subsidiaries.

All audit related services, tax services and other services were pre-approved by the Audit Committee, which concluded that the provision of such services by PWC or KPMG, respectively, was compatible with the maintenance of that firm’s independence in the conduct of its auditing functions. The charter of the Audit Committee provides for pre-approval of audit, audit-related, tax services and other services on an annual basis, including a review of the independent auditor’s audit procedures and risk assessment process in establishing the scope of the services, proposed fees and reports to be rendered.

PART IV

Item 15. Exhibits, Financial Statements, Schedules and Reports on Form 8-K


		(a)	1. and 2. Financial Statements and Schedules

The financial statements and schedules listed below are filed as part of this annual report on the pages indicated.

Index to Financial Statements and Schedules

			Page

Report of Independent Public Auditors			F-1

Consolidated Balance Sheets as of December 31, 2003 and December 31, 2002			F-3

Consolidated Statements of Operations for the Years Ended December 31, 2003, 2002 and 2001			F-4

Consolidated Statements of Beneficiaries’ Equity and Comprehensive Income for the Years Ended December 31, 2003, 2002 and 2001			F-5

Consolidated Statements of Cash Flows for the Years Ended December 31, 2003, 2002 and 2001			F-6

Notes to Consolidated Financial Statements			F-7

Schedule II — Valuation and Qualifying Accounts			F-29

Schedule III — Real Estate and Accumulated Depreciation			F-30

		3.	Exhibits

Exhibits No.		Description
(1)	3.1.1	Amended and Restated Declaration of Trust of the Company (amended and restated as of May 12, 1997)
(2)	3.1.2	Articles of Amendment to Declaration of Trust of the Company (September 4, 1997)
(3)	3.1.3	Articles of Amendment to Declaration of Trust of the Company
(4)	3.1.4	Articles Supplementary to Declaration of Trust of the Company (September 28, 1998)

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Exhibits No.		Description
(5)	3.1.5	Articles of Amendment to Declaration of Trust of the Company (March 19, 1999)
(6)	3.1.6	Articles Supplementary to Declaration of Trust of the Company (April 19, 1999)
(7)	3.1.7	Articles Supplementary to Declaration of Trust of the Company (December 30, 2003)
(8)	3.1.8	Articles Supplementary to Declaration of Trust of the Company (February 5, 2004)
(9)	3.2	Amended and Restated Bylaws of the Company
(10)	10.1	Second Amended and Restated Partnership Agreement of Brandywine Realty Services Partnership
(11)	10.2	Amended and Restated Articles of Incorporation of Brandywine Realty Services Corporation
(12)	10.3	Amended and Restated Agreement of Limited Partnership of Brandywine Operating Partnership, L.P. (the “Operating Partnership”)
(12)	10.4	Amendment No. 1 to Amended and Restated Agreement of Limited Partnership of the Operating Partnership
(12)	10.5	First Amendment to Amended and Restated Agreement of the Operating Partnership
(13)	10.6	Second Amendment to the Amended and Restated Agreement of Limited Partnership Agreement of the Operating Partnership
(14)	10.7	Third Amendment to the Amended and Restated Agreement of Limited Partnership of the Operating Partnership
(14)	10.8	Tax Indemnification Agreement dated May 8, 1998, by and between the Operating Partnership and the parties identified on the signature page
(15)	10.9	Contribution Agreement dated as of July 10, 1998 (Axinn)
(15)	10.10	Form of Donald E. Axinn Options **
(4)	10.11	Fourth Amendment to the Amended and Restated Agreement of Limited Partnership of the Operating Partnership
(4)	10.12	Fifth Amendment to the Amended and Restated Agreement of Limited Partnership of the Operating Partnership
(4)	10.13	Sixth Amendment to the Amended and Restated Agreement of Limited Partnership of the Operating Partnership
	10.14	Seventh Amendment to the Amended and Restated Agreement of Limited Partnership of the Operating Partnership
	10.15	Eighth Amendment to the Amended and Restated Agreement of Limited Partnership of the Operating Partnership
	10.16	Ninth Amendment to the Amended and Restated Agreement of Limited Partnership of the Operating Partnership
	10.17	Tenth Amendment to the Amended and Restated Agreement of Limited Partnership of the Operating Partnership
	10.18	Eleventh Amendment to the Amended and Restated Agreement of Limited Partnership of the Operating Partnership
	10.19	Twelfth Amendment to the Amended and Restated Agreement of Limited Partnership of the Operating Partnership
(4)	10.20	First Amendment to Contribution Agreement (Axinn)
(16)	10.21	Form of Board of Trustees Designation Letter (Lazard)
(9)	10.22	Agreement dated as of December 31, 2001 with Anthony A. Nichols, Sr. **
(10)	10.23	Amended and Restated Employment Agreement dated as of May 7, 2002 of Gerard H. Sweeney**
(5)	10.24	Amended and Restated Non-Qualified Stock Option Award to Anthony A. Nichols, Sr. **
(5)	10.25	Amended and Restated Non-Qualified Stock Option Award to Gerard H. Sweeney **
(5)	10.26	Severance Agreement (Anthony S. Rimikis) **
(5)	10.27	Third Amendment to Restricted Share Award to Gerard H. Sweeney.**
(5)	10.28	Restricted Share Award to Anthony S. Rimikis.**
(17)	10.29	Restricted Share Award to Gerard H. Sweeney **
(18)	10.30	Fourth Amendment to Restricted Share Award to Gerard H. Sweeney**
(18)	10.31	Severance Agreement (Barbara L. Yamarick)**
(18)	10.32	Severance Agreement (Anthony A. Nichols, Jr.)**

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Exhibits No.		Description
(18)	10.33	Severance Agreement (H. Jeffrey De Vuono)**
(18)	10.34	Severance Agreement (George Sowa)**
(18)	10.35	Severance Agreement (Bradley W. Harris)**
(18)	10.36	Restricted Share Award to Gerard H. Sweeney**
(18)	10.37	Restricted Share Award to Anthony S. Rimikis**
(18)	10.38	Restricted Share Award to Barbara L. Yamarick**
(18)	10.39	Restricted Share Award to Anthony A. Nichols, Jr.**
(18)	10.40	Restricted Share Award to H. Jeffrey De Vuono**
(18)	10.41	Restricted Share Award to George Sowa**
(18)	10.42	Restricted Share Award to Bradley W. Harris**
(19)	10.43	2002 Restricted Share Award for Gerard H. Sweeney**
(19)	10.44	2002 Form of Restricted Share Award for Executive Officers**
(20)	10.45	Third Amended and Restated Credit Agreement
(21)	10.46	Term Credit Agreement
(21)	10.47	Consent and First Amendment to Third Amended and Restated Credit Agreement
(21)	10.48	Second Amendment to Third Amended and Restated Credit Agreement
(22)	10.49	2002 Restricted Share Award to Christopher P. Marr**
(22)	10.50	Severance Agreement to Christopher P. Marr**
(23)	10.51	2002 Non-Qualified Option to Gerard H. Sweeney**
(11)	10.52	Executive Deferred Compensation Plan**
(11)	10.53	2003 Restricted Share Award to Gerard H. Sweeney**
(11)	10.54	2003 Restricted Share Award to Anthony S. Rimikis**
(11)	10.55	2003 Restricted Share Award to Barbara L. Yamarick**
(11)	10.56	2003 Restricted Share Award to Anthony A. Nichols, Jr.**
(11)	10.57	2003 Restricted Share Award to H. Jeffrey DeVuono**
(11)	10.58	2003 Restricted Share Award to George D. Sowa**
(11)	10.59	2003 Restricted Share Award to Bradley W. Harris**
(11)	10.60	2003 Restricted Share Award to Brad A. Molotsky**
(11)	10.61	2003 Restricted Share Award to Christopher P. Marr**
(24)	10.62	Letter to Cohen & Steers Capital Management, Inc.
(7)	10.63	Redemption and Conversion Agreement with Five Arrows Realty Securities III L.L.C.
(25)	10.64	Purchase Agreement with Commonwealth Atlantic Operating Properties Inc.
	12.1	Statement re Computation of Ratios
	14.1	Code of Business Conduct and Ethics
	21.1	List of Subsidiaries of the Company
	23.1	Consent of KPMG LLP
	23.2	Consent of PricewaterhouseCoopers LLP
	31.1	Certification Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934
	31.2	Certification Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934
	32.1	Certification Pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934
	32.2	Certification Pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934


1.	Previously filed as an exhibit to the Company’s Form 8-K dated June 9, 1997 and incorporated herein by reference.


2.	Previously filed as an exhibit to the Company’s Form 8-K dated September 10, 1997 and incorporated herein by reference.


3.	Previously filed as an exhibit to the Company’s Form 8-K dated June 3, 1998 and incorporated herein by reference.


4.	Previously filed as an exhibit to the Company’s Form 8-K dated October 13, 1998 and incorporated herein by reference.

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5.	Previously filed as an exhibit to the Company’s Form 10-K for the fiscal year ended December 31, 1999 and incorporated herein by reference.


6.	Previously filed as an exhibit to the Company’s Form 8-K dated April 26, 1999 and incorporated herein by reference.


7.	Previously filed as an exhibit to the Company’s Form 8-A dated December 29, 2003 and incorporated herein by reference.


8.	Previously filed as an exhibit to the Company’s Form 8-A dated February 5, 2004 and incorporated herein by reference.


9.	Previously filed as an exhibit to the Company’s Form 8-K dated October 14, 2003 and incorporated herein by reference.


10.	Previously filed as an exhibit to the Company’s Registration statement of Form S-11 (File No. 33-4175) and incorporated herein by reference.


11.	Previously filed as an exhibit to the Company’s Form 10-K for the fiscal year ended December 31, 2002 and incorporated herein by reference.


12.	Previously filed as an exhibit to the Company’s Form 8-K dated December 17, 1997 and incorporated herein by reference.


13.	Previously filed as an exhibit to the Company’s Form 8-K dated August 13, 1998 and incorporated herein by reference.


14.	Previously filed as an exhibit to the Company’s Form 8-K dated May 14, 1998 and incorporated herein by reference.


15.	Previously filed as an exhibit to the Company’s Form 8-K dated July 30, 1998 and incorporated herein by reference.


16.	Previously filed as an exhibit to the Company’s Form 8-K dated August 13, 1998 and incorporated herein by reference.


17.	Previously filed as an exhibit to the Company’s Form 10-K for the fiscal year ended December 31, 1997 and incorporated herein by reference.


18.	Previously filed as an exhibit to the Company’s Form 10-K for the fiscal year ended December 31, 2000 and incorporated herein by reference.


19.	Previously filed as an exhibit to the Company’s Form 10-Q for the quarter ended June 30, 2002 and incorporated herein by reference.


20.	Previously filed as an exhibit to the Company’s Form 8-K dated July 12, 2001 and incorporated herein by reference.


21.	Previously filed as an exhibit to the Company’s Form 8-K dated July 16, 2002 and incorporated herein by reference.


22.	Previously filed as an exhibit to the Company’s Form 8-K dated August 27, 2002 and incorporated herein by reference.


23.	Previously filed as an exhibit to the Company’s Form 10-Q for the quarter ended September 30, 2002 and incorporated herein by reference.

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24.	Previously filed as an exhibit to the Company’s Form 10-Q for the quarter ended June 30, 2003 and incorporated herein by reference.


25.	Previously filed as an exhibit to the Company’s Form 8-K dated February 3, 2004 and incorporated herein by reference.

** Management contract or compensatory plan or arrangement.

(b)

Reports on Form 8-K

During the three months ended December 31, 2003 and through March 12, 2004, the Company filed or furnished the following:

(i)

Current Report on Form 8-K filed October 14, 2003 (reporting under Items 5 and 7).


	(ii)	Current Report on Form 8-K filed October 15, 2003 (reporting under Items 5 and 7).


	(iii)	Current Report on Form 8-K furnished October 24, 2003 (reporting under Items 7, 9 and 12).


	(iv)	Current Report on Form 8-K filed December 9, 2003 (reporting under Items 5 and 7).


	(v)	Current Report on Form 8-K filed December 24, 2003 (reporting under Item 5).


	(vi)	Current Report on Form 8-K filed December 29, 2003 (reporting under Items 5 and 7).


	(vii)	Current Report on Form 8-K filed January 7, 2004 (reporting under Items 5 and 7).


	(viii)	Current Report on Form 8-K filed February 3, 2004 (reporting under Items 5 and 7).

	(ix)	Current Report on Form 8-K filed February 5, 2004 (reporting under Items 5 and 7).


	(x)	Current Report on Form 8-K furnished February 12, 2004 (reporting under Items 7 and 12).


	(xi)	Current Report on Form 8-K filed February 27, 2004 (reporting under Items 5 and 7).

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	BRANDYWINE REALTY TRUST

	By:	/ s/ Gerard H. Sweeney Gerard H. Sweeney
		President and Chief Executive Officer

Pursuant to the requirements of the Securities and Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant in the capacities and on the dates indicated.

Signature	Title	Date


/s/ Anthony A. Nichols, Sr. Anthony A. Nichols, Sr.	Chairman of the Board and Trustee	March 12, 2004

/s/ Gerard H. Sweeney Gerard H. Sweeney	President, Chief Executive Officer and Trustee (Principal Executive Officer)	March 12, 2004

/s/ Christopher P. Marr Christopher P. Marr	Senior Vice President and Chief Financial Officer (Principal Financial Officer)	March 12, 2004

/s/ Bradley W. Harris Bradley W. Harris	Vice President and Chief Accounting Officer (Principal Accounting Officer)	March 12, 2004

/s/ Walter D’Alessio Walter D’Alessio	Trustee	March 12, 2004

/s/ Charles P. Pizzi Charles P. Pizzi	Trustee	March 12, 2004

/s/ Donald E. Axinn Donald E. Axinn	Trustee	March 12, 2004

/s/ Robert C. Larson Robert C. Larson	Trustee	March 12, 2004

/s/ D. Pike Aloian D. Pike Aloian	Trustee	March 12, 2004

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REPORT OF INDEPENDENT AUDITORS

To the Board of Trustees and Shareholders:

In our opinion, the consolidated financial statements listed in the index appearing under Item 15(a)(1) and (2) present fairly, in all material respects, the consolidated financial position of Brandywine Realty Trust and its subsidiaries (the “Company”) at December 31, 2003, and the results of their operations and their cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the consolidated financial statement schedules listed in the index appearing under Item 15(a)(1) and (2) present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These consolidated financial statements and consolidated financial statement schedules are the responsibility of the Company’s management; our responsibility is to express an opinion on these consolidated financial statements and consolidated financial statement schedules based on our audit. We conducted our audit of these statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP
Philadelphia, Pennsylvania
February 20, 2004

F-1

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INDEPENDENT AUDITORS’ REPORT

To the Shareholders and Board of Trustees
of Brandywine Realty Trust:

We have audited the consolidated balance sheet of Brandywine Realty Trust and subsidiaries as of December 31, 2002 and the related consolidated statements of operations, beneficiaries’ equity and comprehensive income and cash flows for each of the years in the two-year period ended December 31, 2002. These consolidated financial statements and are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Brandywine Realty Trust and subsidiaries as of December 31, 2002 and the results of their operations and their cash flows for each of the years in the two-year period ended December 31, 2002, in conformity with accounting principles generally accepted in the United States.

As discussed in note 2 to the consolidated financial statements, effective January 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. Also, as discussed in note 2 to the consolidated financial statements, on January 1, 2003, the Company adopted Statement of Financial Accounting Standards No. 145, Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections.

/s/ KPMG LLP

Philadelphia, Pennsylvania
February 26, 2003, except as to Notes 9, 12, and 13 which are dated as of December 31, 2003

F-2

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BRANDYWINE REALTY TRUST
CONSOLIDATED BALANCE SHEETS
(in thousands, except number of shares)

	December 31,
	2003			2002

ASSETS
Real estate investments:
Operating properties	$	1,869,744		$	1,890,009
Accumulated depreciation		(268,091	)		(245,230	)

		1,601,653			1,644,779
Construction-in-progress		29,787			41,986
Land held for development		63,915			59,216

		1,695,355			1,745,981

Cash and cash equivalents		8,552			26,801
Escrowed cash		14,388			16,318
Accounts receivable, net		5,206			3,657
Accrued rent receivable, net		26,652			28,333
Marketable securities		12,052			11,872
Assets held for sale		5,317			7,666
Investment in real estate ventures, at equity		15,853			14,842
Deferred costs, net		27,269			29,271
Other assets		45,132			34,547

Total assets	$	1,855,776		$	1,919,288

LIABILITIES AND BENEFICIARIES’ EQUITY
Mortgage notes payable	$	462,659		$	597,729
Borrowings under Credit Facility		305,000			307,000
Unsecured term loan		100,000			100,000
Accounts payable and accrued expenses		30,290			27,576
Distributions payable		20,947			21,186
Tenant security deposits and deferred rents		16,123			22,276
Other liabilities		15,360			22,006
Liabilities related to assets held for sale		52			20

Total liabilities		950,431			1,097,793

Minority interest		134,357			135,052

Commitments and contingencies		—			—
Beneficiaries’ equity:
Preferred Shares (shares authorized-10,000,000):
7.25% Series A Preferred Shares, $0.01 par value;
issued and outstanding-750,000
in 2003 and 2002		8			8
8.75% Series B Preferred Shares, $0.01 par value;
issued and outstanding- no shares
in 2003 and 4,375,000 in 2002		—			44
7.50% Series C Preferred Shares, $0.01 par value;
issued and outstanding-2,000,000 in 2003
and no shares issued and outstanding in 2002		20			—
Common Shares of beneficial interest, $0.01 par value;
shares authorized-100,000,000; issued and outstanding–
41,040,710 in 2003 and 35,226,315 in 2002		410			352
Additional paid-in capital		936,730			841,659
Share warrants		401			401
Cumulative earnings		309,343			225,010
Accumulated other comprehensive loss		(2,158	)		(6,402	)
Cumulative distributions		(473,766	)		(374,629	)

Total beneficiaries’ equity		770,988			686,443

Total liabilities and beneficiaries’ equity	$	1,855,776		$	1,919,288

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

F-3

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BRANDYWINE REALTY TRUST
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share information)

	Year ended December 31,
	2003			2002			2001

Revenue:
Rents	$	256,945		$	248,075		$	228,149
Tenant reimbursements		37,755			33,263			31,993
Other		10,959			9,702			10,346

Total revenue		305,659			291,040			270,488

Operating Expenses:
Property operating expenses		80,817			74,967			70,604
Real estate taxes		27,919			25,196			22,435
Interest		57,835			63,522			67,496
Depreciation and amortization		60,592			56,431			67,224
Administrative expenses		14,464			14,804			15,177
Non-recurring charges		—			—			6,600

Total operating expenses		241,627			234,920			249,536

Income from continuing operations before equity in income of real estate ventures, net gains on sales and minority interest		64,032			56,120			20,952
Equity in income of real estate ventures		52			987			2,768

Income from continuing operations before net gains on sales and minority interest		64,084			57,107			23,720
Net gains on sales of interests in real estate		20,537			—			4,524

Income before minority interest		84,621			57,107			28,244
Minority interest attributable to continuing operations		(10,141	)		(9,265	)		(7,818	)

Income from continuing operations		74,480			47,842			20,426
Discontinued operations:
Income from discontinued operations		2,156			7,467			14,100
Net gain on disposition of discontinued operations		9,690			8,562			—
Minority interest		(517	)		(887	)		(804	)

Income from discontinued operations		11,329			15,142			13,296

Net income		85,809			62,984			33,722
Income allocated to Preferred Shares		(11,906	)		(11,906	)		(11,906	)
Preferred Share redemption/conversion charge		(20,598	)		—			—

Income allocated to Common Shares	$	53,305		$	51,078		$	21,816

Basic earnings per Common Share:
Continuing operations	$	1.09		$	0.97		$	0.20
Discontinued operations		0.31			0.43			0.37

	$	1.40		$	1.40		$	0.57

Diluted earnings per Common Share:
Continuing operations	$	1.09		$	0.97		$	0.20
Discontinued operations		0.31			0.42			0.37

	$	1.40		$	1.39		$	0.57

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

F-4

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BRANDYWINE REALTY TRUST
CONSOLIDATED STATEMENTS OF BENEFICIARIES’ EQUITY AND COMPREHENSIVE INCOME
For the years ended December 31, 2003, 2002 and 2001
(in thousands, except number of shares)

	Number of Preferred A Shares		Par Value of Preferred A Shares		Number of Preferred B Shares			Par Value of Preferred B Shares			Number of Preferred C Shares		Par Value of Preferred C Shares		Number of Common Shares			Par Value of Common Shares			Additional Paid-in Capital			Employee Stock Loans			Share Warrants			Cumulative Earnings			Accumulated Other Comprehensive Income (Loss)			Cumulative Distributions			Total

BALANCE, January 1, 2001		750,000	$	8		4,375,000		$	44			—	$	—		35,681,314		$	357		$	854,375		$	(6,837	)	$	908		$	131,256		$	(1,731	)	$	(226,212	)	$	752,168
Comprehensive income:
Net income																															33,722									33,722
Other comprehensive income:
Cumulative effect of adopting SFAS 133																																		(1,300	)
Unrealized loss on derivative financial instruments																																		(3,371	)
Unrealized gain on available-for-sale securities																																		1,815

Total other comprehensive income																																		(2,856	)					(2,856	)

Total comprehensive income																																								30,866
Vesting of Restricted Stock																175,411			2			3,983																		3,985
Repurchase of Common Shares																(373,713	)		(4	)		(7,290	)																	(7,294	)
Employee stock loans used to purchase Common Shares																71,276			1			1,385			(1,386	)														—
Payment/forgiveness of employee stock loans																									2,524															2,524
Accretion of Preferred Share discount																						1,476									(1,476	)								—
Exercise of warrants/options																86,647						(17	)					(507	)											(524	)
Preferred Share distributions																																					(11,906	)		(11,906	)
Distributions ($1.70 per share)																																					(61,663	)		(61,663	)

BALANCE, December 31, 2001		750,000		8		4,375,000			44			—		—		35,640,935			356			853,912			(5,699	)		401			163,502			(4,587	)		(299,781	)		708,156
Comprehensive income:
Net income																															62,984									62,984
Other comprehensive income:
Unrealized loss on derivative financial instruments																																		(2,548	)
Unrealized gain on available-for-sale securities																																		733

Total other comprehensive income																																		(1,815	)					(1,815	)

Total comprehensive income																																								61,169
Vesting of Restricted Stock																76,454			1			1,895																		1,896
Repurchase of Common Shares																(491,074	)		(5	)		(11,048	)																	(11,053	)
Payment/forgiveness of employee stock loans																									1,658															1,658
Accretion of Preferred Share discount																						1,476									(1,476	)								—
Amortization of stock options																						43																		43
Exercise of warrants/options																						(578	)																	(578	)
Preferred Share distributions																																					(11,906	)		(11,906	)
Distributions ($1.76 per share)																																					(62,942	)		(62,942	)

BALANCE, December 31, 2002		750,000		8		4,375,000			44			—		—		35,226,315			352			845,700			(4,041	)		401			225,010			(6,402	)		(374,629	)		686,443
Comprehensive income:
Net income																															85,809									85,809
Other comprehensive income:
Unrealized loss on derivative financial instruments																																		4,194
Unrealized gain on available-for-sale securities																																		50

Total other comprehensive income																																		4,244						4,244

Total comprehensive income																																								90,053
Vesting of Restricted Stock																82,912			1			1,767																		1,768
Issuance of Preferred Shares												2,000,000		20								47,892																		47,912
Conversion of Preferred Shares						(1,093,750	)		(11	)						1,093,750			11			3,828															(3,828	)		—
Redemption of Preferred Shares						(3,281,250	)		(33	)												(74,647	)														(16,770	)		(91,450	)
Issuance of Common Shares																4,587,500			46			110,936																		110,982
Conversion of Class A minority interest units																50,233			1			1,205																		1,206
Payment/forgiveness of employee stock loans																									2,509															2,509
Accretion of Preferred Share discount																						1,476									(1,476	)								—
Amortization of stock options																						104																		104
Preferred Share distributions																																					(11,906	)		(11,906	)
Distributions ($1.76 per share)																																					(66,633	)		(66,633	)

BALANCE, December 31, 2003		750,000	$	8		—		$	—			2,000,000	$	20		41,040,710		$	411		$	938,261		$	(1,532	)	$	401		$	309,343		$	(2,158	)	$	(473,766	)	$	770,988

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

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BRANDYWINE REALTY TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

	Year ended December 31,
	2003			2002			2001

Cash flows from operating activities:
Net income	$	85,809		$	62,984		$	33,722
Adjustments to reconcile net income to net cash from operating activities:
Depreciation		54,353			52,944			73,031
Amortization:
Deferred financing costs		2,304			1,795			3,790
Deferred leasing costs		7,032			5,820			5,158
Deferred compensation costs		2,869			3,182			3,710
Straight-line rental income		(5,917	)		(5,930	)		(6,206	)
Provision for doubtful accounts		189			894			2,867
Net gain on sales of interests in real estate		(30,227	)		(8,562	)		(4,524	)
Non-recurring charge		—			—			6,600
Impairment loss on assets held-for-sale		—			665			—
Minority interest		10,658			10,152			8,622
Changes in assets and liabilities:
Accounts receivable		(1,462	)		2,582			(212	)
Other assets		(4,232	)		11,029			17,464
Accounts payable and accrued expenses		1,911			(6,040	)		4,292
Tenant security deposits and deferred rents		(2,432	)		(521	)		5,058
Other liabilities		(2,062	)		(2,158	)		(1,332	)

Net cash from operating activities		118,793			128,836			152,040

Cash flows from investing activities:
Acquisition of properties		(67,490	)		(25,146	)		(40,359	)
Sales of properties, net		87,461			78,019			31,335
Capital expenditures		(50,885	)		(38,787	)		(107,405	)
Investment in real estate ventures		(521	)		(446	)		(2,495	)
Increase in escrowed cash		1,930			2,553			(1,016	)
Cash distributions from real estate ventures in excess of income		3,258			1,969			5,492
Leasing costs		(7,821	)		(13,124	)		(9,234	)

Net cash from investing activities		(34,068	)		5,038			(123,682	)

Cash flows from financing activites:
Proceeds from notes payable, Credit Facility		220,000			15,000			91,000
Repayment of notes payable, Credit Facility		(222,000	)		(102,325	)		(35,000	)
Proceeds from Term Loan		–			100,000			–
Proceeds from mortgage notes payable		–			20,186			135,165
Repayment of mortgage notes payable		(82,131	)		(48,646	)		(127,876	)
Debt financing costs		(112	)		(658	)		(5,557	)
Repayments on employee stock loans		2,509			1,658			1,024
Proceeds from issuances of shares, net		159,107			—			—
Redemption of Preferred Shares		(91,422	)		—			—
Repurchases of Common Shares and minority interest units		—			(20,165	)		(6,494	)
Distributions paid to shareholders		(78,754	)		(75,022	)		(72,534	)
Distributions to minority interest holders		(10,171	)		(10,560	)		(10,667	)

Net cash from financing activities		(102,974	)		(120,532	)		(30,939	)

(Decrease) increase in cash and cash equivalents		(18,249	)		13,342			(2,581	)
Cash and cash equivalents at beginning of year		26,801			13,459			16,040

Cash and cash equivalents at end of year	$	8,552		$	26,801		$	13,459

Supplemental disclosure:
Cash paid for interest, net of capitalized interest	$	52,645		$	61,814		$	74,736

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

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BRANDYWINE REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2003, 2002 AND 2001

1.	ORGANIZATION AND NATURE OF OPERATIONS

Brandywine Realty Trust, a Maryland Real Estate Investment Trust (collectively with its subsidiaries, the “Company”), is a self-administered and self-managed real estate investment trust (a “REIT”) active in acquiring, developing, redeveloping, leasing and managing office and industrial properties. As of December 31, 2003, the Company’s portfolio included 208 office properties, 25 industrial facilities and one mixed-use property (collectively, the “Properties”) that contained an aggregate of approximately 15.7 million net rentable square feet. The Properties are located in the office and industrial markets in and surrounding Philadelphia, Pennsylvania, New Jersey and Richmond, Virginia. As of December 31, 2003, the Company also held economic interests in ten unconsolidated real estate ventures (the “Real Estate Ventures”) formed with third parties to develop or own commercial properties.

The Company’s interest in its assets is held through Brandywine Operating Partnership, L.P., a Delaware limited partnership (the “Operating Partnership”). The Company is the sole general partner of the Operating Partnership and, as of December 31, 2003, was entitled to approximately 95.8% of the Operating Partnership’s distributions after distributions to holders of then outstanding Series B Preferred Units (as defined in Note 3 below). The Operating Partnership owns a 95% interest in a taxable REIT subsidiary, Brandywine Realty Services Corporation, a Pennsylvania corporation (the “Management Company”), that, as of December 31, 2003, was performing management and leasing services for properties containing an aggregate of approximately 19.3 million net rentable square feet, of which approximately 15.7 million net rentable square feet related to properties owned by the Company and approximately 3.6 million net rentable square feet related to properties owned by third parties. The remaining 5% of the Management Company is owned by a partnership comprised of two executives of the Company.

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The accompanying consolidated financial statements include all accounts of the Company, its majority-owned and/or controlled subsidiaries, which consist principally of the Operating Partnership as well as the Management Company (consolidated subsequent to January 1, 2001, see below). The portion of these entities not owned by the Company is presented as minority interest as of and during the periods consolidated. All intercompany accounts and transactions have been eliminated in consolidation.

See Investments in Unconsolidated Real Estate Ventures in Note 6 for the Company’s treatment of unconsolidated real estate venture interests. All significant intercompany accounts and transactions have been eliminated.

Management Company

The Management Company, a taxable REIT subsidiary, provides management, leasing, construction, development, redevelopment and other real estate related services for the Company’s properties and for third parties. Prior to December 31, 2000, the Company owned 100% of the Management Company’s non-voting preferred stock and 5% of its voting common stock and accounted for its investment using the equity method. Effective January 1, 2001, the Company converted its non-voting interest in the Management Company to a voting interest. As a result, the Company owns 95% of the Management Company’s equity, has voting control and, therefore, has consolidated the Management Company since January 1, 2001.

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Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Management makes significant estimates regarding revenue, impairment of long-lived assets, allowance for doubtful accounts and deferred costs.

Operating Properties

Operating properties are carried at historical cost less accumulated depreciation and impairment losses. The cost of operating properties reflects their purchase price or development cost. Costs incurred for the acquisition and renovation of an operating property are capitalized to the Company’s investment in that property. Ordinary repairs and maintenance are expensed as incurred; major replacements and betterments, which improve or extend the life of the asset, are capitalized and depreciated over their estimated useful lives. Fully- depreciated assets are removed from the accounts.

Purchase Price Allocation

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As of December 31, 2003 and 2002, intangible assets and acquired lease liabilities consist of the following:

	As of December 31,
	2003		2002

	(amounts in thousands)
Intangible assets (included in Other Assets and Other Liabilities):
Acquired lease asset, net of accumulated amortization of $345 and $99, respectively	$	1,866	$	607
Value of In-Place leases, net of accumulated amortization of $93 in 2003		2,335		—
Value of tenant relationships, net of accumulated amortization of $84 in 2003		2,033		—
Origination value, net of accumulated amortization of $471 and $256, respectively		1,198		959

Net intangible assets	$	7,432	$	1,566

Acquired lease liability, net of accumulated amortization of $869 and $558, respectively	$	1,305	$	1,547

Depreciation and Amortization

The costs of buildings and improvements are depreciated using the straight-line method based on the following useful lives: buildings and improvements (five to 40 years) and tenant improvements (the shorter of the lease term or the life of the asset).

Effective January 1, 2002, the Company changed the estimated useful lives of various buildings from 25 to 40 years. This change resulted in an increase of net income of $19.0 million or $.53 per share for the year ended December 31, 2002. Management determined the longer period to be a better estimate of the useful lives of the buildings.

Construction in Progress

Project costs directly associated with the development and construction of a real estate project are capitalized as construction in progress. In addition, interest, real estate taxes and general and administrative expenses that are directly associated with the Company’s development activities are capitalized until completion of the building shell. Once the building shell of a real estate project is completed, the costs capitalized to construction in progress are transferred to land and buildings. Direct construction costs totaling $1.7 million in 2003, $2.2 million in 2002 and $2.7 million in 2001 and interest totaling $1.5 million in 2003, $2.9 million in 2002 and $5.2 million in 2001 were capitalized related to development of certain Properties and land holdings.

Impairment of Long-Lived Assets

Statement of Financial Accounting Standard No. 144 (“SFAS 144”), Accounting for the Impairment or Disposal of Long-Lived Assets, provides a single accounting model for long-lived assets as held-for-sale, broadens the scope of businesses to be disposed of that qualify for reporting as discontinued operations and changes the timing of recognizing losses on such operations. The company adopted SFAS 144 on January 1, 2002.

In accordance with SFAS 144, long-lived assets, such as real estate investments and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated. The other assets and liabilities related to assets classified as held-for-sale are presented separately in the consolidated balance sheet. For the year ended December 31, 2002, the Company recorded an impairment charge associated with an asset held-for-sale (See Note 9). The Company recorded no impairment losses for the years ended December 31, 2003 and 2001.

Cash and Cash Equivalents

Cash and cash equivalents are highly-liquid investments with original maturities of three months or less. The Company maintains cash equivalents in financial institutions in excess of insured limits, but believes this risk is mitigated by only investing in or through major financial institutions.

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Escrowed Cash

Restricted cash consists of cash held as collateral to provide credit enhancement for the Company’s mortgage debt, cash for property taxes, capital expenditures and tenant improvements.

Accounts Receivable

Leases with tenants are accounted for as operating leases. Minimum annual rentals under tenant leases are recognized on a straight-line basis over the term of the related lease. Accrued rent receivable represents the amount that straight-line rental income exceeds rents currently due under the lease agreements. Included in current tenant receivables are tenant reimbursements which are comprised of amounts recoverable from tenants for common area maintenance expenses and certain other recoverable expenses that are recognized as revenue in the period in which the related expenses are incurred. As of December 31, 2003 and 2002, no tenant represents more than 10% of accounts receivable.

Tenant receivables and accrued rent receivables are carried net of the allowances for doubtful accounts of $1.5 million and $2.5 million in 2003 and $2.3 million and $2.3 million in 2002. Management’s determination of the adequacy of these allowances is based primarily upon evaluations of historical loss experience, individual receivables and current economic conditions.

Marketable Securities

The Company accounts for its investments in equity securities according to the provisions of SFAS 115, Accounting for Certain Investments in Debt and Equity Securities, which requires securities classified as “available-for-sale” to be stated at fair value. Adjustments to fair value of available-for-sale securities are recorded as a component of other comprehensive income (loss). A decline in the market value of equity securities below cost that is deemed to be other than temporary results in a reduction in the carrying amount to fair value. The impairment is charged to earnings and a new cost basis for the security is established.

As of December 31, 2003, the Company had no material exposure to market risk (including foreign currency exchange risk, commodity price risk or equity price risk).

Investments in Unconsolidated Real Estate Ventures

The Company accounts for its investments in unconsolidated Real Estate Ventures under the equity method of accounting as the Company exercises significant influence, but does not control these entities under the provisions of the entities’ governing agreements. These investments are recorded initially at cost, as Investments in Real Estate Ventures, and subsequently adjusted for equity in earnings and cash contributions and distributions.

On a periodic basis, management assesses whether there are any indicators that the value of the Company’s investments in unconsolidated Real Estate Ventures may be impaired. An investment is impaired only if management’s estimate of the value of the investment is less than the carrying value of the investment. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the value of the investment. During the year ended December 31, 2003, the Company recorded an impairment charge associated with an investment in a non-operating Real Estate Venture (see Note 9).

Deferred Costs

Costs incurred in connection with property leasing are capitalized as deferred leasing costs. Deferred leasing costs consist primarily of leasing commissions that are amortized on the straight-line method over the life of the respective lease which generally ranges from one to 15 years. Management re-evaluates the remaining useful lives of leasing costs as economic and market conditions change. Internal direct leasing costs deferred totaled $3.9 million in 2003, $3.6 million in 2002 and $3.1 million in 2001.

Costs incurred in connection with debt financing are capitalized as deferred financing costs and charged to interest expense over the terms of the related debt agreements. Deferred financing costs consist

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primarily of loan fees which are amortized over the related loan term. Total accumulated amortization related to these costs was $5.0 million in 2003 and $3.5 million in 2002.

Other Assets

As of December 31, 2003, other assets included a direct financing lease of $16.1 million, intangible assets related to property acquisitions of $6.2 million, prepaid real estate taxes of $5.4 million, deposits on properties to be purchased in 2004 totaling $5.1 million, cash surrender value of life insurance of $3.7 million, furniture, fixtures and equipment of $2.1 million and $6.5 million of other assets. As of December 31, 2002, other assets included a direct financing lease of $16.0 million, prepaid real estate taxes of $5.6 million, promissory notes of $4.0 million, furniture, fixtures and equipment of $2.1 million and $6.8 million of other assets.

Fair Value of Financial Instruments

Carrying amounts reported in the balance sheet for cash, accounts receivable, other assets, accounts payable and accrued expenses, and borrowings under the Credit Facility approximate fair value. Accordingly, these items have been excluded from the fair value disclosures.

Revenue Recognition

Rental revenue is recognized on the straight-line basis from the later of the date of the origination of the lease or the date of acquisition of the facility subject to existing leases, which averages minimum rents over the terms of the leases. The cumulative difference between lease revenue recognized under this method and contractual lease payment terms is recorded as “accrued rent receivable” on the accompanying balance sheets. The straight-line rent adjustment increased revenue by approximately $5.9 million in 2003, $5.9 million in 2002 and $6.2 million in 2001. The leases also typically provide for tenant reimbursement of common area maintenance and other operating expenses. Deferred rental revenue represents rental revenue received from tenants prior to their due dates.

No tenant represented greater than 10% of the Company’s rental revenue in 2003, 2002 or 2001.

Income Taxes

The Company elects to be taxed as a real estate investment trust under Sections 856-860 of the Internal Revenue Code. In management’s opinion, the requirements to maintain this election are being met. Accordingly, no provision for Federal income taxes has been reflected in the financial statements.

Earnings and profits, which determine the taxability of distributions to shareholders, differ from net income reported for financial reporting purposes due to differences in cost basis, the estimated useful lives used to compute depreciation, and the allocation of net income and loss for financial versus tax reporting purposes. The tax basis in the Company’s assets was $1.4 billion as of December 31, 2003 and $1.3 billion as of December 31, 2002.

The Company is subject to a 4% Federal excise tax, if sufficient taxable income is not distributed within prescribed time limits. The excise tax equals 4% of the annual amount, if any, by which the sum of (a) 85% of the Company’s ordinary income and (b) 95% of the Company’s net capital gain exceeds cash distributions and certain taxes paid by the Company. No excise tax was incurred in 2003, 2002, or 2001.

The Management Company is subject to Federal and state income taxes. There was no provision required for income taxes in 2003, 2002 and 2001.

Earnings Per Share

Basic earnings per share is calculated by dividing income applicable to Common Shares by the weighted-average number of shares outstanding during the period. Diluted earnings per share includes the effect of common share equivalents outstanding during the period.

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Stock-Based Compensation Plans

In December 2002, the Financial Accounting Standards Board issued SFAS 148 (“SFAS 148”), Accounting for Stock-Based Compensation — Transition and Disclosure. SFAS 148 amends SFAS 123 (“SFAS 123”), Accounting for Stock-Based Compensation, to provide alternative methods of transition for an entity that voluntarily adopts the fair value recognition method of recording stock option expense. SFAS 148 also amends the disclosure provisions of SFAS 123 and APB Opinion No. 28, Interim Financial Reporting, to require disclosure in the summary of significant accounting policies of the effects of an entity’s accounting policy with respect to stock options on reported net income and earnings per share in annual and interim financial statements. The Company adopted SFAS 148 on a prospective basis for all grants subsequent to January 1, 2002.

Prior to 2002, the Company accounted for stock options issued under the recognition and measurement provisions of APB Opinion No. 25, Accounting for Stock Issued to Employees and Related Interpretations. The following table illustrates the effect on net income and earnings per share if the fair value based method had been applied to all outstanding and unvested awards in each period (in thousands, except per share amounts):

	Year ended December 31,
	2003			2002			2001

Net income available to Common Shares, as reported	$	53,305		$	51,078		$	21,816
Add: Stock based compensation expense included in reported net income		2,740			2,553			2,828
Deduct: Total stock based compensation expense determined under fair value recognition method for all awards		(3,191	)		(3,231	)		(3,506	)

Pro forma net income available to Common Shares	$	52,854		$	50,400		$	21,138


Earnings per Common Share
Basic — as reported	$	1.40		$	1.40		$	0.57

Basic — pro forma	$	1.39		$	1.38		$	0.55


Diluted — as reported	$	1.40		$	1.39		$	0.57

Diluted — pro forma	$	1.39		$	1.37		$	0.55

Comprehensive Income

Comprehensive income or loss is recorded in accordance with the provisions of SFAS 130 (“SFAS 130”), Reporting Comprehensive Income. SFAS 130 establishes standards for reporting comprehensive income and its components in financial statements. Comprehensive income includes unrealized gains and losses on available-for-sale securities and the effective portions of changes in the fair value of derivatives.

Accounting for Derivative Instruments and Hedging Activities

The Company accounts for its derivative instruments and hedging activities under SFAS No. 133 (“SFAS 133”), Accounting for Derivative Instruments and Hedging Activities, and its corresponding amendments under SFAS No. 138, Accounting for Certain Derivative Instruments and Hedging Activities — An Amendment of SFAS 133. SFAS 133 requires the Company to measure every derivative instrument (including certain derivative instruments embedded in other contracts) at fair value and record them in the balance sheet as either an asset or liability. For derivatives designated as fair value hedges, the changes in fair value of both the derivative instrument and the hedged item are recorded in earnings. For derivatives designated as cash flow hedges, the effective portions of changes in the fair value of the derivative are reported in other comprehensive income. Changes in fair value of derivative instruments and ineffective portions of hedges are recognized in earnings in the current period. For the year ended December 31, 2003, the Company was not party to any derivative contract designated as a fair value hedge.

The Company actively manages its ratio of fixed-to-floating rate debt. To manage its fixed and floating rate debt in a cost-effective manner, the Company, from time to time, enters into interest rate swap agreements as cash flow hedges, under which it agrees to exchange various combinations of fixed and/or variable interest rates based on agreed upon notional amounts. See Note 8.

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New Pronouncements

As of January 1, 2003, the Company adopted SFAS No 145 (“SFAS 145”), Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections. In adopting SFAS 145, the Company has reclassified an extraordinary item recorded during 2001 relating to the write-off of $1.1 million of unamortized deferred financing costs as interest expense.

In January 2003, the FASB issued FASB Interpretation No. 46 (“FIN 46”), “Consolidation of Variable Interest Entities,” an interpretation of ARB 51. FIN 46 provides guidance on identifying entities for which control is achieved through means other than through voting rights (a “variable interest entity” or “VIE”), and how to determine when and which business enterprise should consolidate a VIE. This new models for consolidation applies to an entity which either (1) the equity investors (if any) do not have a controlling financial interest or (2) the equity investment at risk is insufficient to finance that entity’s activities without receiving additional subordinated financial interest from other parties. The provisions of this interpretation apply to the first fiscal year or interim period ending after December 15, 2003.

The Company was originally required to implement the consolidation guidance established in Interpretation No. 46 (“FIN 46”), Consolidation of Variable Interest Entities, immediately for new or modified transactions and by July 1, 2003 for the Variable Interest Entities (“VIEs”) with which the Company became involved prior to February 1, 2003. However, in October 2003 and December 2003, the FASB deferred application of FIN 46 twice from July 1, 2003 to December 31, 2003, and then to March 31, 2004 for VIEs entered into prior to February 1, 2003. The Company is in process of determining whether it will need to consolidate previously unconsolidated VIEs or to deconsolidate previously consolidated VIEs. Based upon its relationships with such entities, the Company believes that the implementation of the consolidation guidance will not have a material effect on the Company’s consolidated financial position.

In May 2003, the FASB issued SFAS No. 150 (“SFAS 150”), Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity. SFAS 150 generally applies to instruments that are mandatorily redeemable, that represent obligations that will be settled with a variable number of the Company’s shares, or that represent an obligation to purchase a fixed number of the Company’s shares. For instruments within its scope, the statement requires classification as a liability with initial measurement at fair value. Subsequent measurement depends upon the certainty of the terms of the settlement (amount, timing) and whether the obligation will be settled by a transfer of assets or by issuance of a variable number of equity shares. SFAS 150 is applicable now for instruments issued since SFAS 150 was issued, and as of July 1, 2003, for instruments that predate SFAS 150’s issuance. On November 7, 2003, the FASB issued Financial Statement Position 150-3 which among other things deferred indefinitely certain portions of SFAS 150 affecting the accounting for minority interests representing non-controlling interests in finite life entities. The adoption of SFAS 150, as modified, did not have a significant effect at adoption nor is it expected to have a significant prospective impact on the Company’s financial position, results of operations or comprehensive income.

Emerging Issue Task Force 00-21 (“EITF 00-21”), Accounting for Revenue Arrangements with Multiple Deliverables, issued during the fourth quarter of 2003, provides guidance on revenue recognition for revenues derived from a single contract that contains multiple products or services. EITF 00-21 also provides additional requirements to determine when these revenues may be recorded separately for accounting purposes. EITF 00-21 did not impact our consolidated financial statements.

In December 2003, the SEC issued Staff Accounting Bulletin No. 104 (“SAB 104”), Revenue Recognition, which supercedes SAB 101, Revenue Recognition in Financial Statements. SAB 104’s primary purpose is to rescind the accounting guidance contained in SAB 101 related to multiple element revenue arrangements, superceded as a result of the issuance of EITF 00-21. SAB 104 did not impact our consolidated financial statements.

3.	MINORITY INTEREST

Minority interest is comprised of Class A Units of limited partnership interest (“Class A Units”) and Series B Preferred Units of limited partnership interest (“Series B Preferred Units”). The Operating Partnership issued these interests to persons that contributed assets to the Operating Partnership. The Operating Partnership is obligated to redeem, at the request of a holder, each Class A Unit for cash or one Common Share, at the option of the Company. Each Series B Preferred Unit has a stated value of $50.00

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and is convertible, at the option of the holder, into Class A Units at a conversion price of $28.00. The Series B Preferred Units bear a preferred distribution of 7.25% per annum, subject to an increase in the event quarterly distributions paid to holders of Common Shares exceed $0.51 per share. Income allocated to minority interest includes the amount of the Series B Preferred Unit distribution and the prorata share of net income of the Operating Partnership allocated to the Class A Units. The Company declared distributions of $7.1 million in 2003, 2002 and 2001 to the holders of Series B Preferred Units and $3.1 million in 2003, $3.3 million in 2002 and $3.7 million in 2001 to holders of Class A Units. As of December 31, 2003 and 2002, the Company had the following Class A Units and Series B Preferred Units held by third party investors:

	As of December 31,
	2003		2002

Class A Units		1,737,203		1,787,436
Series B Preferred Units		1,950,000		1,950,000

Subsequent to December 31, 2003, the Company redeemed all of the Series B Preferred Units (see Note 20).

4.	REAL ESTATE INVESTMENTS

As of December 31, 2003 and 2002, the carrying value of the Company’s Properties is as follows:

	December 31,
	2003		2002

	(amounts in thousands)
Land	$	342,424	$	353,111
Building and improvements		1,426,925		1,442,819
Tenant improvements		100,395		94,079

	$	1,869,744	$	1,890,009


5.	ACQUISITIONS AND DISPOSITIONS OF REAL ESTATE INVESTMENTS

The Company’s acquisitions were accounted for by the purchase method. The results of each acquired property are included in the Company’s results of operations from their respective purchase dates.

2003

During 2003, the Company sold eight office properties containing an aggregate of approximately 343,000 net rentable square feet, two industrial properties containing an aggregate of approximately 131,000 net rentable square feet and four parcels of land containing an aggregate of approximately 24.1 acres for an aggregate of $45.6 million. In December 2003, the Company sold two office properties containing an aggregate of approximately 633,000 net rentable square feet for an aggregate of $112.8 million, of which $52.9 million of proceeds were used to pay off existing mortgage notes payable secured by the two properties. The Company retained a 20% interest in the venture that purchased the properties. The Company recognized a gain on the partial sale of approximately $18.5 million, which is recorded in net gain on sale of real estate interests due to a continuing 20% interest that the Company has maintained in the properties for the portion sold and deferred the gain on the piece retained.. The gain on sale and historical results for these properties have not been reflected as discontinued operations because of the Company’s continuing involvement. The Company also purchased five office properties containing approximately 360,000 net rentable square feet and one parcel of land containing approximately 10.0 acres for an aggregate of $67.8 million.

2002

During 2002, the Company sold 23 office properties containing an aggregate of 1.4 million net rentable square feet, 20 industrial properties containing an aggregate of .9 million net rentable square feet and two parcels of land containing an aggregate of 12.8 acres for an aggregate of $190.8 million, realizing a net gain of $8.6 million before minority interest. The Company also purchased seven office properties containing 617,000 net rentable square feet and one parcel of land containing 9.0 acres for an aggregate of $99.1 million.

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2001

During 2001, the Company sold three office and eight industrial properties, containing 440,000 net rentable square feet, and four parcels of land, containing 15.8 acres, for $31.3 million, realizing a net gain of $4.5 million. Seven of the properties were sold for $21.6 million realizing an aggregate gain of $4.3 million, four of the properties were sold for $7.1 million, realizing an aggregate loss of $.7 million and four land parcels were sold for $2.6 million realizing an aggregate gain of $.9 million. The Company also acquired two office properties, containing 146,000 net rentable square feet, and three parcels of land, containing 36.0 acres, for $31.5 million, of which $4.2 million was satisfied with an exchange of property.

In addition to the sales and acquisitions above, the Company consummated an exchange of properties with Prentiss Properties Acquisition Partners, L.P. (“Prentiss”) during 2001. The Company acquired from Prentiss 30 properties (29 office and 1 industrial) containing 1.6 million net rentable square feet and 6.9 acres of developable land for total consideration of $215.2 million. The Company conveyed to Prentiss four office properties located in Northern Virginia that contain an aggregate of 657,000 net rentable square feet, assumed $79.7 million of mortgage debt secured by certain of the Prentiss properties, issued a $7.8 million promissory note, paid $15.9 million at closing and agreed to make additional payments totaling $7.0 million (including $5.4 million of payments discounted at 7.5%) over a three-year period subsequent to closing. The Company also contributed to Prentiss its interest in a real estate venture that owns two additional office properties that contain an aggregate of 452,000 net rentable square feet and received a combination of preferred and common units of limited partnership interest in Prentiss having a value of $10.7 million, as of the closing. In addition as part of the Prentiss transaction in June 2001, the Company purchased a 103,000 square foot building then under construction for $4.2 million and six acres of related developable land for $5.7 million.

6.	INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES

As of December 31, 2003, the Company had an aggregate investment of approximately $15.9 million in ten Real Estate Ventures (net of returns of investment received by the Company). The Company formed these ventures with unaffiliated third parties to develop office properties or to acquire land in anticipation of possible development of office properties. Nine of the Real Estate Ventures own ten office buildings that contain an aggregate of approximately 1.8 million net rentable square feet and one Real Estate Venture developed a hotel property that contains 137 rooms.

The Company accounts for its non-controlling interests in the Real Estate Ventures using the equity method. Non-controlling ownership interests generally range from 6% to 65%. Ownership percentages represent the Company’s entitlement to residual distributions after payments of priority returns. The Company’s investments, initially recorded at cost, are subsequently adjusted for the Company’s net equity in the ventures’ income or loss and cash contributions and distributions.

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The Company’s investment in Real Estate Ventures as of December 31, 2003 is as follows (in thousands):

	Ownership Percentage (1)			Carrying Amount		Real Estate Venture Debt at 100%		Company’s Share of Real Estate Venture Income (Loss)			Current Interest Rate		Debt Maturity

Two Tower Bridge Associates		35	%	$	2,409	$	10,501	$	290			6.82%		May-08
Four Tower Bridge Associates		65	%		2,454		11,000		(21	)		6.62%		Feb-11
Five Tower Bridge Associates		15	%		—		30,600		—			6.77%		Feb-09
Six Tower Bridge Associates		65	%		113		15,683		(46	)		7.79%		Aug-12
Eight Tower Bridge Associates		6	%		1,147		38,219		(189	)		3.34%		Feb-05
Tower Bridge Inn Associates		50	%		2,291		11,547		(235	)		8.50%		Apr-07
1000 Chesterbrook Boulevard		50	%		3,373		27,860		456			6.88%		Nov-11
PJP Building Two, LC		30	%		15		5,738		30			6.12%		Nov-23
PJP Building Five, LC		25	%		238		5,753		94			2.69%		Oct-05
Macquarie		20	%		3,813		74,500		64			4.62%		Jan-09
Florig, LP (2)		30	%		—		—		(861	)		N/A		N/A
Invesco Partnership, L.P. (3)		35	%		—		—		470			N/A		N/A


				$	15,853	$	231,401	$	52

(1)	Ownership percentage represents the Company’s entitlement to residual distributions after payments of priority returns.

(2)	During 2003, the Company recorded an impairment charge of $861,000 associated with this non-operating real estate venture. This amount consisted primarily of legal and acquisition costs related to a parcel of land that ultimately was not acquired.

(3)	Company’s interest consists solely of a residual profits interest.

The following is a summary of the financial position of the unconsolidated Real Estate Ventures in which the Company had investment interests as of December 31, 2003 and 2002 (in thousands):

	December 31,

	2003		2002

Net property	$	322,196	$	193,552
Other assets		29,982		20,163
Liabilities		27,900		3,186
Debt		231,401		149,129
Equity		92,877		61,400
Company’s share of equity		15,853		14,842

The following is a summary of results of operations of the unconsolidated Real Estate Ventures in which the Company had interests as of December 31, 2003, 2002 and 2001 (in thousands):

	Year ended December 31,
	2003		2002		2001

Revenue	$	29,703	$	27,219	$	24,117
Operating expenses		11,576		10,406		8,237
Interest expense, net		9,585		9,212		7,495
Depreciation and amortization		8,085		5,531		3,211
Net (loss) income		457		2,070		5,174
Company’s share of income		52		987		2,768

The following is a summary of the financial position as of December 31, 2003 and the results of operations for the year ended December 31, 2003 for each of the unconsolidated Real Estate Ventures in which the Company had interests as of December 31, 2003 (in thousands):

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	1000 Chesterbrook Boulevard Partnership		Two Tower Bridge Associates		Four Tower Bridge Associates		Five Tower Bridge Associates		Six Tower Bridge Associates		Eight Tower Bridge Associates			Tower Bridge Inn Associates			PJP Building Two, LC		PJP Building Five, LC		BDN/ Macquire LLC		Total

Assets
Net Property	$	30,885	$	12,488	$	13,038	$	39,026	$	15,143	$	57,270		$	15,149		$	5,642	$	6,684	$	126,871	$	322,196
Other Assets		3,238		740		613		4,429		1,151		2,063			947			747		678		15,376		29,982

Total Assets	$	34,123	$	13,228	$	13,651	$	43,455	$	16,294	$	59,333		$	16,096		$	6,389	$	7,362	$	142,247	$	352,178


Liabilities and Equity
Other Liabilities	$	244	$	378	$	240	$	967	$	487	$	556		$	342		$	220	$	47	$	24,419	$	27,900
Debt		27,860		10,501		11,000		30,600		15,683		38,219			11,547			5,738		5,753		74,500		231,401

Total Liabilities		28,104		10,879		11,240		31,567		16,170		38,775			11,889			5,958		5,800		98,919		259,301
Equity		6,019		2,349		2,411		11,888		124		20,558			4,207			431		1,562		43,328		92,877

Total Liabilities and Equity	$	34,123	$	13,228	$	13,651	$	43,455	$	16,294	$	59,333		$	16,096		$	6,389	$	7,362	$	142,247	$	352,178


Revenues
Revenues	$	5,079	$	2,057	$	2,255	$	5,976	$	2,966	$	1,507		$	4,245		$	915	$	855	$	788	$	26,643
Tenant reimbursements and other		526		376		397		466		518		109			—			12		308		348		3,060

Total Revenue		5,605		2,433		2,652		6,442		3,484		1,616			4,245			927		1,163		1,136		29,703

Operating Expenses
Property Operating Expenses		743		744		843		1,545		907		1,214			2,483			357		327		219		9,382
Real Estate Taxes		430		148		148		382		233		363			265			49		60		112		2,190
Depreciation and Amortization		1,239		367		676		2,009		807		1,567			711			210		236		263		8,085
Interest		1,929		479		728		2,004		1,231		1,635			990			205		164		220		9,585
Administrative Expenses		4		—		—		—		—		—			—			—		—		—		4

Total Operating Expenses		4,345		1,738		2,395		5,940		3,178		4,779			4,449			821		787		814		29,246

Net Income	$	1,260	$	695	$	257	$	502	$	306	$	(3,163	)	$	(204	)	$	106	$	376	$	322	$	457

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As of December 31, 2003, the aggregate principal payments of non-recourse debt payable to third-parties is as follows (in thousands):

2004	$	1,644
2005		45,542
2006		1,823
2007		12,411
2008 and thereafter		169,981

	$	231,401

As of December 31, 2003, the Company had guaranteed repayment of approximately $17.4 million of loans on behalf of the Real Estate Ventures, including a $16.2 million guaranty that terminated in January 2004. See Item 2. Properties — Real Estate Ventures. The Company also provides customary environmental indemnities in connection with construction and permanent financing both for its own account and on behalf of its Real Estate Ventures.

7.	INDEBTEDNESS

Credit Facility

The Company utilizes credit facility borrowings for general business purposes, including the acquisition of properties and the repayment of other debt. The Company maintains a $500 million unsecured credit facility (the “Credit Facility”) that matures in June 2004. Borrowings under the Credit Facility bear interest at 30-day LIBOR (LIBOR was 1.12% at December 31, 2003) plus 1.5% per annum, with the spread over LIBOR subject to reductions from .10% to .25% or increases of .25% based on the Company’s leverage. As of December 31, 2003, the Company had $305.0 million of borrowings and $10.7 million of letters of credit outstanding under the Credit Facility, leaving $184.3 million of unused availability. The weighted-average interest rate on the Company’s unsecured credit facilities was 4.60% in 2003, 5.41% in 2002, and 6.48% in 2001.

Unsecured Term Loan

The Company also maintains a $100 million term loan. The term loan is unsecured and matures on July 15, 2005, subject to two extensions of one year each upon payment of an extension fee and the absence of any defaults at the time of each extension. There are no scheduled principal payments prior to maturity. The term loan bears interest at a spread over the one, two, three or six month LIBOR that varies between 1.05% and 1.90% per annum (1.12% as of December 31, 2003), based on the Company’s leverage ratio. The weighted-average interest rate on the Company’s term loan was 3.0% in 2003 and 3.0% in 2002.

Mortgage Notes Payable

As of December 31, 2003, the Company had $462.7 million of mortgage notes payable, secured by 93 of the Properties and certain land holdings. Fixed rate mortgages, totaling $402.3 million, require payments of principal and/or interest (or imputed interest) at rates ranging from 7.00% to 9.25% per annum and mature on dates from November 2004 through July 2027. Variable rate mortgages, totaling $60.4 million, require payments of principal and/or interest at rates ranging from 30-day LIBOR plus .76% to 1.60% per annum or 75% of prime (prime rate was 4.00% at December 31, 2003) and mature on dates from March 2004 through July 2027. The weighted-average interest rate on the Company’s mortgages was 7.09% in 2003, 7.27% in 2002, and 7.39% in 2001.

Debt Covenants

The Credit Facility and Term Loan require the maintenance of certain ratios related to minimum net worth, debt-to-total capitalization and fixed charge coverage and various non-financial covenants. As of December 31, 2003, the Company was in compliance with all debt covenants. As of December 31, 2003, the carrying value of the Company’s debt was below fair market value by approximately $85.7 million, as determined by using year-end interest rates and market conditions.

Principal Payments

The following table outlines the timing of payment requirements related to the Company’s indebtedness as of December 31, 2003:

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	Payments by Period (in thousands)
			Less than						More than
	Total		1 Year		1-3 Years		3-5 Years		5 Years

Mortgage notes payable:
Fixed rate	$	402,321	$	10,277	$	24,759	$	40,259	$	327,026
Variable rate		24,815		172		407		552		23,684
Construction loans		35,523		35,523		—		—		—

		462,659		45,972		25,166		40,811		350,710
Revolving credit facility		305,000		305,000		—		—		—
Unsecured debt		100,000		—		100,000		—		—

	$	867,659	$	350,972	$	125,166	$	40,811	$	350,710


8.	RISK MANAGEMENT AND USE OF FINANCIAL INSTRUMENTS

Risk Management

In the normal course of its on-going business operations, the Company encounters economic risk. There are three main components of economic risk: interest rate risk, credit risk and market risk. The Company is subject to interest rate risk on its interest-bearing liabilities. Credit risk is the risk of inability or unwillingness of tenants to make contractually required payments. Market risk is the risk of declines in the value of properties due to changes in rental rates, interest rates or other market factors affecting the valuation of properties held by the Company.

Use of Derivative Financial Instruments

The Company’s use of derivative instruments is limited to the utilization of interest rate agreements or other instruments to manage interest rate risk exposures and not for speculative purposes. The principal objective of such arrangements is to minimize the risks and/or costs associated with the Company’s operating and financial structure, as well as to hedge specific transactions. The counterparties to these arrangements are major financial institutions with which the Company and its affiliates may also have other financial relationships. The Company is potentially exposed to credit loss in the event of non-performance by these counterparties. However, because of the high credit ratings of the counterparties, the Company does not anticipate that any of the counterparties will fail to meet these obligations as they come due. The Company does not hedge credit or property value market risks.

The Company formally assesses, both at inception of the hedge and on an on-going basis, whether each derivative is highly-effective in offsetting changes in cash flows of the hedged item. If management determines that a derivative is not highly-effective as a hedge or if a derivative ceases to be a highly-effective hedge, the Company will discontinue hedge accounting prospectively.

The following table summarizes the terms and fair values of the Company’s derivative financial instruments at December 31, 2003 (in thousands).

			Notional							Fair
Hedge Product	Hedge Type		Amount		Strike			Maturity		Value (Liability)

Cap		Cash flow	$	28,000		8.700	%		7/12/2004	$	—
Swap		Cash flow		100,000		4.230	%		6/29/2004		(1,733	)
Swap		Cash flow		50,000		4.215	%		6/29/2004		(863	)
Swap		Cash flow		25,000		4.215	%		6/29/2004		(431	)

										$	(3,027	)

The Company has entered into interest rate swap and rate cap agreements designated as cash flow hedges that are designed to reduce the impact of interest rate changes on its variable rate debt. At December 31, 2003, the Company had interest rate swap agreements for notional principal amounts aggregating $175 million. The swap agreements effectively fix the 30-day LIBOR interest rate on $100 million of Credit Facility borrowings at 4.230% per annum and on $75 million of Credit Facility borrowings at 4.215% per annum, in each case until June 2004. The weighted-average interest rate on borrowings under the Credit

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Facility, including the effect of cash flow hedges, was 4.60% in 2003, 5.41% in 2002 and 6.48% in 2001. The interest rate cap agreement effectively limits the interest rate on a mortgage with a notional value of $28 million at 8.7% per annum until July 2004. The notional amount at December 31, 2003 provides an indication of the extent of the Company’s involvement in these instruments at that time, but does not represent exposure to credit, interest rate or market risks.

As of December 31, 2003, the maximum length of time until which the Company was hedging its exposure to the variability in future cash flows was through June 2004. There was no gain or loss reclassified from accumulated other comprehensive loss into earnings during 2003, 2002 and 2001 as a result of the discontinuance of a cash flow hedge due to the probability of the original forecasted transaction not occurring.

Over time, the unrealized gains and losses held in Other Comprehensive Income (“OCI”) will be reclassified to earnings in the same period(s) in which the hedged items are recognized in earnings. The current balance held in OCI is expected to be reclassified to earnings over the lives of the current hedging instruments, or for realized losses on forecasted debt transactions, over the related term of the debt obligation, as applicable. The Company expects that $3.0 million of net hedging losses will be reclassified into earnings over the next twelve months.

Concentration of Credit Risk

Concentrations of credit risk arise when a number of tenants related to the Company’s investments or rental operations are engaged in similar business activities, or are located in the same geographic region, or have similar economic features that would cause their inability to meet contractual obligations, including those to the Company, to be similarly affected. The Company regularly monitors its tenant base to assess potential concentrations of credit risk. Management believes the current credit risk portfolio is reasonably well diversified and does not contain any unusual concentration of credit risk. No tenant accounted for 10% or more of the Company’s rents during 2003, 2002 and 2001. See Note 12 for geographic segment information.

9.	DISCONTINUED OPERATIONS

For the years ended December 31, 2003, 2002 and 2001, income from discontinued operations relates to 53 properties containing approximately 2.7 million net rentable square feet that the Company sold between January 1, 2002 and December 31, 2003 and two properties containing approximately 82,000 net rentable square feet that the Company has designated as “held-for-sale” as of December 31, 2003. The following table summarizes information for two properties designated as held-for-sale as of December 31, 2003 and December 31, 2002:

	December 31,

	2003		2002

	(amounts in thousands)

Real Estate Investments:
Operating Properties	$	6,143	$	8,729
Accumulated depreciation		(906)		(1,235)

		5,237		7,494
Construction-in-progress		—		55

		5,237		7,549

Accrued rent receivable		65		87
Deferred costs, net		15		2
Other assets		—		28

	$	5,317	$	7,666

Tenant security deposits and deferred rents	$	52	$	20

The following table summarizes revenue and expense information for the 53 properties sold since January 1, 2002 and the two properties designated as held-for-sale as of December 31, 2003 (in thousands):

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	Year Ended December 31,
	2003			2002			2001

Revenue:
Rents	$	5,089		$	14,566		$	34,631
Tenant reimbursements		781			2,144			5,258
Other		34			663			448

Total revenue		5,904			17,373			40,337

Expenses:
Property operating expenses		2,095			4,665			9,939
Real estate taxes		860			2,243			5,333
Depreciation and amortization		793			2,333			10,965
Impairment loss on assets held-for-sale		—			665			—

Total operating expenses		3,748			9,906			26,237

Income from discontinued operations before net gain on sale
of interests in real estate and minority interest		2,156			7,467			14,100
Net gain on sales of interest in real estate		9,690			8,562			—
Minority interest		(517	)		(887	)		(804	)

Income from discontinued operations	$	11,329		$	15,142		$	13,296

In 2002, the Company recorded an impairment charge of $665,000 in its consolidated statements of operations related to one of the assets held-for-sale.

Discontinued operations have not been segregated in the consolidated statements of cash flows. Therefore, amounts for certain captions will not agree with respective data in the Consolidated Statements of Operations.

10.

PREFERRED SHARES AND BENEFICIARIES’ EQUITY

In 1998, the Company issued $37.5 million of convertible preferred shares with a 7.25% coupon rate (the Series A Preferred Shares). Each Series A Preferred Share has a stated value of $50.00 and is convertible into Common Shares, at the option of the holder, at a conversion price of $28.00. The Series A Preferred Shares distribution is subject to an increase, if quarterly distributions paid to Common Share holders exceeds $0.51 per share. The Series A Preferred Shares are perpetual and may be redeemed, at the Company’s option, at par beginning in January 2004.

In 1999, the Company issued $105.0 million of convertible preferred shares with an 8.75% coupon rate (the Series B Preferred Shares) for net proceeds of $94.8 million. Each Series B Preferred Share was convertible into one Common Shares and was entitled to quarterly dividends equal to the greater of $0.525 per share or the quarterly dividend on a Common Share. As part of the transaction in which the Company issued Series B Preferred Shares, the Company issued the holder of the Series B Preferred Shares seven-year warrants exercisable for 500,000 Common Shares at an exercise price of $24.00 per share.

On December 30, 2003, the holder converted 1,093,750 shares of the Series B Preferred Shares into 1,093,750 Common Shares, and the Company redeemed the remaining 3,281,250 Series B Preferred Shares at $27.50 per share for approximately $90.2 million (plus accrued distributions thereon for the period from October 1, 2003 through the redemption date) and purchased 250,000 warrants with an exercise price of $24.00 per share for approximately $1.2 million. The Company incurred a charge of $20.6 million associated with the redemption/conversion of the Series B Preferred Shares.

On December 30, 2003, the Company also issued 2,000,000 shares of 7.50% Series C Cumulative Redeemable Preferred Shares for net proceeds of $48.1 million. The Series C Preferred Shares are perpetual. The Company may not redeem Series C Preferred Shares before December 30, 2008 except to preserve its REIT status. On or after December 30, 2008, the Company, at its option, may redeem Series C Preferred Shares, in whole or in part, by paying $25.00 per share plus accrued but unpaid dividends.

The Company’s Board of Trustees has approved a share repurchase program authorizing the Company to repurchase up to 4,000,000 of its outstanding Common Shares. Through December 31, 2003, the

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Company had repurchased 3.2 million of its Common Shares at an average price of $17.75 per share. Under the share repurchase program, the Company has the authority to repurchase an additional 762,000 shares. No time limit has been placed on the duration of the share repurchase program. The following table summarizes the share repurchases during the three years ended December 31, 2003:

	Year ended December 31,
	2003		2002		2001

Repurchased amount (shares)		—		491,074		373,713
Repurchased amount ($, in thousands)	$	—	$	11,053	$	7,294
Average price per share	$	—	$	22.51	$	19.52

The following table summarizes the Class A Units tendered for redemption in cash during the three years ended December 31, 2003:

	Year ended December 31,
	2003		2002		2001

Repurchased amount (units)		—		364,222		3,247
Repurchased amount ($, in thousands)	$	—	$	8,536	$	64
Average price per unit	$	—	$	23.44	$	19.72

At December 31, 2003, 362,321 unvested restricted Common Shares were held by employees of the Company. The restricted shares, valued at $18.4 million at issuance, are amortized over their respective vesting periods of three to eight years from dates of the original award. The Company recorded compensation expense of $2.6 million in 2003, $2.5 million in 2002 and $2.8 million in 2001 related to these shares.

As of December 31, 2003, there were warrants outstanding exercisable for 250,000 Common Shares at an exercise price of $24.00.

11.

STOCK BASED COMPENSATION AND EMPLOYEE BENEFITS

The Company maintains a plan that authorizes the issuance of various equity-based awards including incentive stock options. The terms and conditions of option awards are determined by the Board of Trustees. Incentive stock options may not be granted at exercise prices less than fair value of the stock at the time of grant. Options granted by the Company generally vest over two to five years. All options awarded by the Company to date are non-qualified stock options. As of December 31, 2003, the Company is authorized to issue five million equity-based awards of which 1.3 million shares remain available for future issuance under the plan.

The following table summarizes option activity for the three years ended December 31, 2003:


				-
	Number			Weighted
	of Shares			Average		Grant Price Range
	Under			Exercise
	Option			Price		From		To

Balance at January 1, 2001		2,623,714		$	26.36	$	6.21	$	29.04
Exercised		-83,333			19.50		19.50		19.50
Canceled		(61,582	)		27.53		25.25		29.04

Balance at December 31, 2001		2,478,799			26.56		6.21		29.04
Granted		100,000			19.50		19.50		19.50
Exercised		(55,000	)		19.50		19.50		19.50
Canceled		(151,172	)		22.22		19.50		29.04

Balance at December 31, 2002 and 2003		2,372,627			26.70		6.21		29.04

The following table summarizes stock options outstanding as of December 31, 2003:

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The following table summarizes stock options outstanding as of December 31, 2003:

			Weighted-
			Average		Weighted-				Weighted-
Range of	Number of		Remaining		Average		Number of		Average
Exercise	Options		Contractual		Exercise		Options		Exercise
Prices	Outstanding		Life		Price		Exercisable		Price

$6.21 to $14.31		46,667		.6 years	$	12.00		46,667	$	12.00
$19.50		100,000		1.6		19.50		33,330		19.50
$24.00 to $29.04		2,225,960		4.1		27.33		2,225,960		27.33
$6.21 to $29.04		2,372,627		3.9		26.70		2,305,957		26.91

Based on the Black-Scholes option pricing model, the estimated weighted-average fair value of stock options granted was $2.51 in 2002. Assumptions made in determining estimates of fair value include: risk-free interest rate of 2.7% in 2002, a volatility factor of .280 in 2002, a dividend yield of 8.4% in 2002, and a weighted-average life expectancy of 3 years in 2002.

Effective January 1, 2002, the Company voluntarily adopted the fair value recognition provisions of SFAS 123, prospectively for all employee awards granted, modified, or settled after January 1, 2002 (see Note 2). Accordingly, the Company recorded compensation expense of $104,000 in 2003 and $43,000 in 2002. This compensation expense relates to the Company’s grant of 100,000 stock options during 2002.

The Company sponsors a 401(k) defined contribution plan for its employees. Each employee may contribute up to 100% of annual compensation, subject to specific limitations under the Internal Revenue Code. At its discretion, the Company can make matching contributions equal to a percentage of the employee’s elective contribution and profit sharing contributions. Employees vest in employer contributions over a three-year service period. The Company contributions were $821,000 in 2003, $816,000 in 2002 and $669,000 in 2001.

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12.

SEGMENT INFORMATION

The Company currently manages its portfolio within three segments: (1) Pennsylvania, (2) New Jersey and (3) Virginia. Corporate is responsible for cash and investment management and certain other general support functions.

Segment information for the three years ended December 31, 2003, 2002 and 2001 is as follows (in thousands):

	Pennsylvania		New Jersey		Virginia		Corporate		Total

2003:
Real estate investments, at cost:
Operating properties	$	1,146,350	$	508,906	$	214,488	$	—	$	1,869,744
Construction-in-progress		25,162		4,043		582		—		29,787
Land held for development		38,723		15,352		9,840		—		63,915
Assets held for sale		—		3,649		1,668		—		5,317
Total revenue	$	185,206	$	88,453	$	27,841	$	4,159	$	305,659
Property operating expenses and real estate taxes		64,307		34,278		10,151		—		108,736

Net operating income	$	120,899	$	54,175	$	17,690	$	4,159	$	196,923

2002:
Real estate investments, at cost:
Operating properties	$	1,169,919	$	506,818	$	213,272	$	—	$	1,890,009
Construction-in-progress		51,469		3,619		3,039		—		58,127
Land held for development		25,051		10,023		8,001		—		43,075
Assets held for sale, at cost		—		7,666		—		—		7,666
Total revenue	$	178,145	$	84,291	$	26,652	$	1,952	$	291,040
Property operating expenses and real estate taxes		60,114		30,543		9,506		—		100,163

Net operating income	$	118,031	$	53,748	$	17,146	$	1,952	$	190,877

2001:
Total revenue	$	159,662	$	80,986	$	27,309	$	2,531	$	270,488
Property operating expenses and real estate taxes		52,931		30,182		9,926		—		93,039

Net operating income	$	106,731	$	50,804	$	17,383	$	2,531	$	177,449

Net operating income is defined as total revenue less property operating expenses and real estate taxes. Below is reconciliation of consolidated net operating income to consolidated income from continuing operations:

	Year Ended December 31
	2003		2002		2001

	(amounts in thousands)
Consolidated net operating income	$	196,923	$	190,877	$	177,449
Less:
Interest expense		57,835		63,522		67,496
Depreciation and amortization		60,592		56,431		67,224
Administrative expenses		14,464		14,804		15,177
Non-recurring charges		—		—		6,600
Minority interest attributable to continuing
operations		10,141		9,265		7,818
Plus:
Equity in income of real estate ventures		52		987		2,768
Net gains on sales of interests in real estate		20,537		—		4,524

Consolidated income from continuing operations	$	74,480	$	47,842	$	20,426

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13.

NET INCOME PER COMMON SHARE

The following table details the number of shares and net income used to calculate basic and diluted earnings per share for the three years ended December 31, 2003 (in thousands, except per share amounts):

	For the year ended December 31,
	2003						2002						2001
		Basic			Diluted			Basic			Diluted			Basic			Diluted

Income from continuing operations	$	74,480		$	74,480		$	47,842		$	47,842		$	20,426		$	20,426
Income from discontinued operations		11,329			11,329			15,142			15,142			13,296			13,296
Income allocated to Preferred Shares		(11,906	)		(11,906	)		(11,906	)		(11,906	)		(11,906	)		(11,906)
Preferred Share redemption/conversion charge		(20,598	)		(20,598	)		—			—			—			—

		53,305			53,305			51,078			51,078			21,816			21,816
Preferred Share discount amortization		(1,476	)		(1,476	)		(1,476	)		(1,476	)		(1,476	)		(1,476	)

Income available to common shareholders	$	51,829		$	51,829		$	49,602		$	49,602		$	20,340		$	20,340

Weighted-average shares outstanding		36,937,467			36,937,467			35,513,813			35,513,813			35,646,842			35,646,842
Options, warrants and unvested restricted stock		—			150,402			—			131,997			—			27,809

Total weighted-average shares outstanding		36,937,467			37,087,869			35,513,813			35,645,810			35,646,842			35,674,651

Earnings per Common Share:
Continuing operations	$	1.09		$	1.09		$	0.97		$	0.97		$	0.20		$	0.20
Discontinued operations		0.31			0.31			0.43			0.42			0.37			0.37

	$	1.40		$	1.40		$	1.40		$	1.39		$	0.57		$	0.57

Securities totaling 6,558,632 in 2003, 11,256,776 in 2002 and 11,622,922 in 2001 were excluded from the earnings per share computations above as their effect would have been antidilutive. Certain preferred equity and preferred operating partnership units would participate in earnings at certain levels whether or not distributed. These thresholds have not been met in years presented and therefore, no additional participation has occurred.

14.	DISTRIBUTIONS (UNAUDITED):

	Year ended December 31
	2003			2002			2001

	(amounts in thousands)
Common Share Distributions:
Ordinary income	$	1.43		$	1.65		$	1.60
Capital gain		0.33			0.11			0.10

Total distributions per share	$	1.76		$	1.76		$	1.70


Percentage classified as ordinary income		81.3	%		93.8	%		94.1%
Percentage classified as capital gain		18.7	%		6.2	%		5.9%

Preferred Share Distributions:
Total distributions declared	$	11,906,000		$	11,906,000		$	11,906,000


15.	RELATED-PARTY TRANSACTIONS

In 1998, the Board authorized the Company to make loans totaling up to $5.0 million to enable employees of the Company to purchase Common Shares at fair market value. The loans have five-year terms, are full recourse, and are secured by the Common Shares purchased. Interest, payable quarterly, accrues on the loans at the lower of the interest rate borne on borrowings under the Company’s Credit Facility or a rate based on the dividend payments on the Common Shares. As of December 31, 2003, the interest rate was 2.62% per annum. The loans are payable at the earlier of the stated maturity date or 90 days following the employee’s termination. As of December 31, 2003, the outstanding balance of these loans totaled $1.5 million and were secured by an aggregate of 85,163 Common Shares.

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The Company owns 384,615 shares of US Realtel, Inc. (“USR”) Common Stock and holds warrants exercisable for 600,000 additional shares. The warrants have an exercise price of $8.00 per share and expire on December 31, 2004. In addition, the Company held warrants exercisable for 123,077 shares at an exercise price of $3.25, and these warrants expire on August 15, 2005. As of December 31, 2003, the Company’s recorded value for its investment in USR was $1.1 million. An officer of the Company holds a position on USR’s Board of Directors.

In February 2000, the Company loaned an aggregate of $2.5 million to two executive officers to enable them to purchase Common Shares of the Company. One loan had a four-year term and bears interest at the lower of the Company’s cost of funds or a rate based on the dividend payable on the Common Shares, but not to exceed 10% annum. This loan was subject to forgiveness over a three-year period, with the amount of forgiveness tied to the Company’s total shareholder return compared to the total shareholder return of peer group companies. This loan was also subject to forgiveness in the event of a change of control of the Company. This loan was reflected as a reduction in beneficiaries equity. In 2001, the Company recorded a $4.1 million charge to restructure the other loan in connection with the executive’s transition to a non-executive, non-managerial status. Principal and interest totaling $1.0 million was forgiven related to these loans in 2003 and $.9 million in 2002 and 2001.

In connection with the sale by the Company of a land parcel in 2003, the Company paid a $42,000 commission to Kevin Nichols, son of Anthony A. Nichols, Sr., Chairman of the Board of the Company, for brokerage services relating to the sale.

Robert Larson, a Trustee of the Company, is a managing director of Lazard Freres & Co. LLC (“Lazard”). The Company paid Lazard a fee of approximately $909,000 for investment banking services related to the Company’s sale of two office properties to a Real Estate Venture in the fourth quarter of 2003.

16.

OPERATING LEASES

The Company leases properties to tenants under operating leases with various expiration dates extending to 2020. As of December 31, 2003, leases covering approximately 1.8 million square feet or 12.8% of the net rentable square footage are scheduled to expire during 2004. Minimum future rentals on non-cancelable leases at December 31, 2003 are as follows (in thousands):

Year	Minimum Rent
2004	$	249,836
2005		216,862
2006		178,757
2007		148,915
2008		116,708
2009 and thereafter		344,434

	$	1,255,512

Total minimum future rentals presented above do not include amounts to be received as tenant reimbursements for increases in certain operating costs.

17.

SUMMARY OF QUARTERLY RESULTS (UNAUDITED)

The following is a summary of quarterly financial information as of and for the years ended December 31, 2003 and 2002 (in thousands, except per share data):

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	1st Quarter		2nd Quarter		3rd Quarter		4th Quarter

2003:
Total revenue	$	75,241	$	74,464	$	77,178	$	78,776
Net income		13,917		13,524		17,400		40,968
Income allocated to Common Shares		10,941		10,548		14,424		17,392

Basic earnings per Common Share	$	0.30	$	0.29	$	0.38	$	0.43
Diluted earnings per Common Share	$	0.30	$	0.29	$	0.37	$	0.43

2002:
Total revenue	$	69,021	$	72,491	$	74,390	$	75,138
Net income		23,469		12,800		13,968		12,747
Income allocated to Common Shares		20,492		9,823		10,992		9,771

Basic earnings per Common Share	$	0.56	$	0.26	$	0.30	$	0.27
Diluted earnings per Common Share	$	0.55	$	0.26	$	0.30	$	0.27

The summation of quarterly earnings per share amounts do not necessarily equal year to date amounts.

18.

COMMITMENTS AND CONTINGENCIES

Legal Proceedings

The Company is involved from time to time in litigation on various matters, including disputes with tenants and disputes arising out of agreements to purchase or sell properties. Given the nature of the Company’s business activities, these lawsuits are considered routine to the conduct of its business. The result of any particular lawsuit cannot be predicted, because of the very nature of litigation, the litigation process and its adversarial nature, and the jury system.

The Company is a defendant in a case in which the plaintiffs allege that the Company breached its obligation to purchase a portfolio of properties of approximately $83.0 million. On July 9, 1999, the Superior Court of New Jersey, Camden County, dismissed the complaint against the Company with prejudice. Plaintiffs subsequently filed a motion for reconsideration, which motion the Superior Court denied. Plaintiffs then appealed to the Appellate Division, which is the intermediate appellate level court in New Jersey. In December 2000, the Appellate Division affirmed in part and reversed in part the Chancery Division’s earlier dismissal of the entire action. The Appellate Division affirmed the dismissal of the non-contractual counts in the Complaint, but reversed the contract and reformation counts and remanded these to the lower court for further proceedings. The Company sought review of this decision by the Supreme Court of New Jersey, but that Court declined to consider the appeal. The case thereafter returned to the Chancery Division, where written and oral discovery were conducted in 2002 and in the first quarter of 2003. Discovery terminated on February 14, 2003. The Company filed a motion for summary judgment seeking dismissal of all counts against it, and judgment for the Company on our counterclaim. The Chancery Division granted the Company’s summary judgment motion on March 25, 2003 and dismissed the case with prejudice. Plaintiffs appealed the judgment in our favor, and the Company does not know whether plaintiffs will be successful in their appeal.

There have been recent reports of lawsuits against owners and managers of multifamily and office properties asserting claims of personal injury and property damage caused by the presence of mold in residential units or office space. The Company has been named as a defendant in two lawsuits that allege personal injury as a result of the presence of mold. Unspecified damages are sought. The Company has referred these lawsuits to its environmental insurance carrier and, as of the date of this Form 10-K, the insurance carrier is tendering a defense to these claims.

Letters-of-Credit

In connection with certain mortgages, the Company is required to maintain leasing and capital reserve accounts with the mortgage lenders through letters-of-credit which totaled $11.5 million at December 31, 2003. The Company is also required to maintain escrow accounts for taxes, insurance and tenant security

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deposits that amounted to $14.4 million at December 31, 2003. The related tenant rents are deposited into the loan servicer’s depository accounts, which are used to fund debt service, operating expenses, capital expenditures and the escrow and reserve accounts, as necessary. Any excess cash is included in cash and cash equivalents.

Other Commitments

As of December 31, 2003, the Company owned 446 acres of land for future development and held options to purchase 61 additional acres.

19.

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The following table details the components of accumulated other comprehensive income (loss) as of and for the three years ended December 31, 2003 (in thousands):

	Unrealized Gains (Losses) on Securities			Cash Flow Hedges			Accumulated Other Comprehensive Loss

Balance at January 1, 2001	$	(1,731	)	$	—		$	(1,731)
Change during year		1,816			(7,921	)		(6,105)
Reclassification adjustments for losses reclassified into operations		—			3,249			3,249

Balance at December 31, 2001		85			(4,672	)		(4,587)
Change during year		733			(7,954	)		(7,221)
Reclassification adjustments for losses
reclassified into operations		—			5,406			5,406

Balance at December 31, 2002	$	818		$	(7,220	)	$	(6,402)
Change during year		51			(1,118	)		(1,067)
Reclassification adjustments for losses
reclassified into operations		—			5,311			5,311

Balance at December 31, 2003	$	869		$	(3,027	)	$	(2,158)


20.	SUBSEQUENT EVENTS

On January 12, 2004, the Company sold 2,645,000 Common Shares in an underwritten public offering for net proceeds (net of transaction costs) of $69.3 million.

On February 3, 2004, the Company entered into an agreement to redeem 1,950,000 Series B Preferred Units, with a stated aggregate value of $97.5 million, on or before March 15, 2003 for an aggregate price of $93.0 million plus accrued but unpaid dividends from January 1, 2004. The Company subsequently redeemed all of such Units.

On February 27, 2004, the Company sold 2,300,000 7.375% Series D Cumulative Redeemable Preferred Shares, each with a liquidation preference of $25.00 per share in an underwritten public offering for net proceeds (net of transaction costs) of $55.5 million.

On March 3, 2004, the Company sold 1,840,000 Common Shares in an underwritten public offering for net proceeds (net of transaction costs) of $50.7 million.

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Brandywine Realty Trust
Schedule II
Valuation and Qualifying Accounts
(in thousands)

Description	Balance at Beginning of Period		Additions Charged to expense		Deductions		Balance at End of Period

Allowance for doubtful accounts:

Year ended December 31, 2003	$	4,576	$	189	$	734	$	4,031


Year ended December 31, 2002	$	4,532	$	894	$	850	$	4,576


Year ended December 31, 2001	$	2,427	$	2,867	$	762	$	4,532

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Brandywine Realty Trust
Schedule III
Real Estate and Accumulated Depreciation
(in thousands)

							Initial Cost							Gross Amount at Which Carried December 31, 2003
	City		State		Encumberances at December 31, 2003		Land		Building and Improvements		Net Improvements (Retirements) Since Acquisition			Land		Building and Improvements		Total (a)		Accumulated Depreciation at December 31, 2003 (b)		Date of Construction		Date Acquired		Depreciable Life

One Greentree Centre		Marlton		NJ		—		345		4,440		401			345		4,841		5,186		2,656		1982		1986		40
Three Greentree Centre		Marlton		NJ		—		323		6,024		91			323		6,115		6,438		3,856		1984		1986		40
Two Greentree Centre		Marlton		NJ		—		264		4,693		104			264		4,797		5,061		2,998		1983		1986		40
110 Summit Drive		Exton		PA		—		403		1,647		157			403		1,804		2,207		446		1985		1996		40
1155 Business Center Drive		Horsham		PA		2,468		1,029		4,124		(182	)		1,029		3,942		4,971		1,291		1990		1996		40
120 West Germantown Pike		Plymouth Meeting		PA		—		685		2,773		400			685		3,173		3,858		812		1984		1996		40
1336 Enterprise Drive		West Goshen		PA		—		731		2,946		51			731		2,997		3,728		716		1990		1996		40
140 West Germantown Pike		Plymouth Meeting		PA		—		481		1,976		236			481		2,212		2,693		701		1984		1996		40
18 Campus Boulevard		Newtown Square		PA		3,408		787		3,312		22			787		3,334		4,121		1,003		1990		1996		40
2240/50 Butler Pike		Plymouth Meeting		PA		—		1,104		4,627		603			1,104		5,230		6,334		1,791		1984		1996		40
2260 Butler Pike		Plymouth Meeting		PA		—		661		2,727		157			661		2,884		3,545		813		1984		1996		40
33 Street Road — Greenwood Square I		Bensalem		PA		—		851		3,407		419			851		3,826		4,677		1,008		1985		1996		40
33 Street Road — Greenwood Square II		Bensalem		PA		—		1,126		4,511		924			1,126		5,435		6,561		1,593		1985		1996		40
33 Street Road — Greenwood Square III		Bensalem		PA		—		350		1,401		101			350		1,502		1,852		367		1985		1996		40
456 Creamery Way		Exton		PA		—		635		2,548		(47	)		635		2,501		3,136		635		1987		1996		40
457 Haddonfield Road		Cherry Hill		NJ		11,410		2,142		9,120		2,536			2,142		11,656		13,798		4,072		1990		1996		40
468 Creamery Way		Exton		PA		—		526		2,112		(37	)		526		2,075		2,601		562		1990		1996		40
486 Thomas Jones Way		Exton		PA		—		806		3,256		(92	)		806		3,164		3,970		852		1990		1996		40
500 Enterprise Road		Horsham		PA		—		1,303		5,188		(790	)		1,303		4,398		5,701		1,245		1990		1996		40
500 North Gulph Road		King of Prussia		PA		—		1,303		5,201		785			1,303		5,986		7,289		1,630		1979		1996		40
650 Dresher Road		Horsham		PA		1,713		636		2,501		314			636		2,815		3,451		733		1984		1996		40
6575 Snowdrift Road		Allentown		PA		—		601		2,411		473			601		2,884		3,485		1,050		1988		1996		40
700 Business Center Drive		Horsham		PA		1,478		550		2,201		226			550		2,427		2,977		611		1986		1996		40
7248 Tilghman Street		Allentown		PA		—		731		2,969		70			731		3,039		3,770		839		1987		1996		40
7310 Tilghman Street		Allentown		PA		—		553		2,246		582			553		2,828		3,381		869		1985		1996		40
800 Business Center Drive		Horsham		PA		2,234		896		3,585		19			896		3,604		4,500		899		1986		1996		40
8000 Lincoln Drive		Marlton		NJ		—		606		2,887		(194	)		606		2,693		3,299		699		1983		1996		40
One Progress Avenue		Horsham		PA		—		1,399		5,629		144			1,399		5,773		7,172		1,507		1986		1996		40
One Righter Parkway		Talleyville		DE		10,680		2,545		10,195		282			2,545		10,477		13,022		2,633		1989		1996		40
1 Foster Avenue		Gibbsboro		NJ		—		93		364		35			93		399		492		83		1972		1997		40
10 Foster Avenue		Gibbsboro		NJ		—		244		971		72			244		1,043		1,287		224		1983		1997		40
100 Berwyn Park		Berwyn		PA		7,135		1,180		7,290		158			1,180		7,448		8,628		1,717		1986		1997		40
100 Commerce Drive		Newark		DE		—		1,160		4,633		516			1,160		5,149		6,309		1,151		1989		1997		40
100 Katchel Blvd		Reading		PA		—		1,881		7,423		139			1,881		7,562		9,443		1,747		1970		1997		40
1000 Atrium Way		Mt. Laurel		NJ		—		2,061		8,180		390			2,061		8,570		10,631		1,957		1989		1997		40
1000 Howard Boulevard		Mt. Laurel		NJ		3,647		2,297		9,288		434			2,297		9,722		12,019		2,474		1988		1997		40
10000 Midlantic Drive		Mt. Laurel		NJ		—		3,206		12,857		1,127			3,206		13,984		17,190		3,255		1990		1997		40
100-300 Gundy Drive		Reading		PA		—		6,495		25,180		5,829			6,495		31,009		37,504		6,931		1970		1997		40
1007 Laurel Oak Road		Voorhees		NJ		—		1,563		6,241		17			1,563		6,258		7,821		1,314		1996		1997		40
105/140 Terry Drive		Newtown		PA		—		2,299		8,238		2,256			2,299		10,494		12,793		2,575		1974		1997		40
111 Presidential Boulevard		Bala Cynwyd		PA		—		5,419		21,612		850			5,419		22,462		27,881		4,711		1974		1997		40
1120 Executive Boulevard		Mt. Laurel		NJ		—		2,074		8,415		762			2,074		9,177		11,251		2,166		1987		1997		40
15000 Midlantic Drive		Mt. Laurel		NJ		—		3,061		12,254		8			3,061		12,262		15,323		2,813		1991		1997		40
2 Foster Avenue		Gibbsboro		NJ		—		185		730		23			185		753		938		158		1974		1997		40
20 East Clementon Road		Gibbsboro		NJ		—		769		3,055		248			769		3,303		4,072		760		1986		1997		40
200 Berwyn Park		Berwyn		PA		9,592		1,533		9,460		606			1,533		10,066		11,599		2,308		1987		1997		40
2000 Midlantic Drive		Mt. Laurel		NJ		9,421		2,202		8,823		462			2,202		9,285		11,487		2,236		1989		1997		40
220 Commerce Drive		Fort Washington		PA		—		1,086		4,338		536			1,086		4,874		5,960		1,099		1974		1997		40

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Brandywine Realty Trust
Schedule III
Real Estate and Accumulated Depreciation
(in thousands)

							Initial Cost							Gross Amount at Which Carried December 31, 2003
	City		State		Encumberances at December 31, 2003		Land		Building and Improvements		Net Improvements (Retirements) Since Acquisition			Land		Building and Improvements		Total (a)		Accumulated Depreciation at December 31, 2003 (b)		Date of Construction		Date Acquired		Depreciable Life

300 Berwyn Park		Berwyn		PA		13,200		2,206		13,422		334			2,206		13,756		15,962		3,093		1989		1997		40
300 Welsh Road — Building I		Horsham		PA		2,297		894		3,572		161			894		3,733		4,627		862		1985		1997		40
300 Welsh Road — Building II		Horsham		PA		1,038		396		1,585		109			396		1,694		2,090		371		1985		1997		40
321 Norristown Road		Lower Gwyned		PA		—		1,290		5,176		1,292			1,290		6,468		7,758		1,490		1972		1997		40
323 Norristown Road		Lower Gwyned		PA		—		1,685		6,751		757			1,685		7,508		9,193		1,669		1988		1997		40
4 Foster Avenue		Gibbsboro		NJ		—		183		726		76			183		802		985		163		1974		1997		40
4000 Midlantic Drive		Mt. Laurel		NJ		3,158		714		5,085		(1,948	)		714		3,137		3,851		716		1981		1997		40
5 Foster Avenue		Gibbsboro		NJ		—		9		32		25			9		57		66		9		1968		1997		40
5 U.S. Avenue		Gibbsboro		NJ		—		21		81		2			21		83		104		18		1987		1997		40
50 East Clementon Road		Gibbsboro		NJ		—		114		964		4			114		968		1,082		203		1986		1997		40
500 Office Center Drive		Ft. Washington		PA		—		1,617		6,480		1,052			1,617		7,532		9,149		2,079		1985		1997		40
501 Office Center Drive		Ft. Washington		PA		—		1,796		7,192		768			1,796		7,960		9,756		1,943		1985		1997		40
55 U.S. Avenue		Gibbsboro		NJ		—		1,116		4,435		51			1,116		4,486		5,602		943		1982		1997		40
6 East Clementon Road		Gibbsboro		NJ		—		1,345		5,366		340			1,345		5,706		7,051		1,298		1980		1997		40
655 Business Center Drive		Horsham		PA		1,810		544		2,529		572			544		3,101		3,645		911		1997		1997		40
7 Foster Avenue		Gibbsboro		NJ		—		231		921		135			231		1,056		1,287		238		1983		1997		40
748 Springdale Drive		Exton		PA		—		236		931		142			236		1,073		1,309		311		1986		1997		40
855 Springdale Drive		Exton		PA		—		838		3,370		80			838		3,450		4,288		796		1986		1997		40
9000 Midlantic Drive		Mt. Laurel		NJ		6,135		1,472		5,895		114			1,472		6,009		7,481		1,367		1989		1997		40
Five Eves Drive		Marlton		NJ		—		703		2,819		649			703		3,468		4,171		1,061		1986		1997		40
Four A Eves Drive		Marlton		NJ		—		539		2,168		167			539		2,335		2,874		657		1987		1997		40
Four B Eves Drive		Marlton		NJ		—		588		2,369		95			588		2,464		3,052		628		1987		1997		40
King & Harvard		Cherry Hill		NJ		—		1,726		1,069		2,193			1,726		3,262		4,988		956		1979		1997		40
Main Street – Piazza		Voorhees		NJ		—		696		2,802		88			696		2,890		3,586		693		1990		1997		40
Main Street – Plaza 1000		Voorhees		NJ		—		2,729		10,931		2,522			2,729		13,453		16,182		3,220		1988		1997		40
Main Street – Promenade		Voorhees		NJ		—		531		2,052		207			531		2,259		2,790		597		1988		1997		40
Main Street- CAM		Voorhees		NJ		—		3		11		98			3		109		112		31		1997		40
One South Union Place		Cherry Hill		NJ		—		771		8,047		480			771		8,527		9,298		2,547		1980		1997		40
Two Eves Drive		Marlton		NJ		—		818		3,461		128			818		3,589		4,407		962		1987		1997		40
1000 First Avenue		King of Prussia		PA		4,516		2,772		10,936		277			2,772		11,213		13,985		1,991		1980		1998		40
1009 Lenox Drive		Lawrenceville		NJ		—		4,876		19,284		3,304			4,876		22,588		27,464		4,932		1989		1998		40
1020 First Avenue		King of Prussia		PA		3,610		2,168		8,576		435			2,168		9,011		11,179		1,590		1984		1998		40
1040 First Avenue		King of Prussia		PA		4,940		2,860		11,282		1,156			2,860		12,438		15,298		2,675		1985		1998		40
1060 First Avenue		King of Prussia		PA		4,415		2,712		10,953		6			2,712		10,959		13,671		1,941		1987		1998		40
14 Campus Boulevard		Newtown Square		PA		5,340		2,244		4,217		(3	)		2,244		4,214		6,458		992		1998		1998		40
150 Corporate Center Drive		Camp Hill		PA		—		964		3,871		273			964		4,144		5,108		849		1987		1998		40
160-180 West Germantown Pike		East Norriton		PA		5,342		1,603		6,418		653			1,603		7,071		8,674		1,515		1982		1998		40
1957 Westmoreland Street		Richmond		VA		2,773		1,061		4,241		284			1,061		4,525		5,586		911		1975		1998		40
200 Corporate Center Drive		Camp Hill		PA		—		1,647		6,606		60			1,647		6,666		8,313		1,300		1989		1998		40
2100-2108 West Laburnum		Richmond		VA		1,131		2,482		8,846		1,840			2,482		10,686		13,168		1,875		1976		1998		40
2120 Tomlynn Street		Richmond		VA		771		281		1,125		147			281		1,272		1,553		248		1986		1998		40
2130-2146 Tomlynn Street		Richmond		VA		1,022		353		1,416		289			353		1,705		2,058		280		1988		1998		40
2169-79 Tomlynn Street		Richmond		VA		1,064		423		1,695		25			423		1,720		2,143		307		1985		1998		40
2201-2245 Tomlynn Street		Richmond		VA		2,762		1,020		4,067		476			1,020		4,543		5,563		979		1989		1998		40
2212-2224 Tomlynn Street		Richmond		VA		1,284		502		2,014		71			502		2,085		2,587		372		1985		1998		40
2221-2245 Dabney Road		Richmond		VA		1,331		530		2,123		27			530		2,150		2,680		384		1994		1998		40
2240 Dabney Road		Richmond		VA		661		264		1,059		8			264		1,067		1,331		193		1984		1998		40
2244 Dabney Road		Richmond		VA		1,367		550		2,203		1			550		2,204		2,754		390		1993		1998		40

F-31

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Brandywine Realty Trust
Schedule III
Real Estate and Accumulated Depreciation
(in thousands)

							Initial Cost							Gross Amount at Which Carried December 31, 2003
	City		State		Encumberances at December 31, 2003		Land		Building and Improvements		Net Improvements (Retirements) Since Acquisition			Land		Building and Improvements		Total (a)		Accumulated Depreciation at December 31, 2003 (b)		Date of Construction		Date Acquired		Depreciable Life

2246 Dabney Road		Richmond		VA		1,131		455		1,822		1			455		1,823		2,278		323		1987		1998		40
2248 Dabney Road		Richmond		VA		1,359		512		2,049		176			512		2,225		2,737		442		1989		1998		40
2251 Dabney Road		Richmond		VA		1,023		387		1,552		121			387		1,673		2,060		321		1983		1998		40
2256 Dabney Road		Richmond		VA		907		356		1,427		44			356		1,471		1,827		279		1982		1998		40
2277 Dabney Road		Richmond		VA		1,262		507		2,034		1			507		2,035		2,542		360		1986		1998		40
2401 Park Drive		Harrisburg		PA		—		182		728		18			182		746		928		145		1984		1998		40
2404 Park Drive		Harrisburg		PA		—		167		668		90			167		758		925		201		1983		1998		40
2490 Boulevard of the Generals		King of Prussia		PA		—		348		1,394		45			348		1,439		1,787		302		1975		1998		40
2511 Brittons Hill Road		Richmond		VA		3,036		1,202		4,820		93			1,202		4,913		6,115		898		1987		1998		40
2812 Emerywood Parkway		Henrico		VA		3,286		1,069		4,281		1,268			1,069		5,549		6,618		844		1980		1998		40
300 Arboretum Place		Richmond		VA		14,872		5,450		21,892		2,076			5,450		23,968		29,418		4,968		1988		1998		40
300 Corporate Center Drive		Camp Hill		PA		—		4,823		19,301		317			4,823		19,618		24,441		3,938		1989		1998		40
303 Fellowship Drive		Mt. Laurel		NJ		2,591		1,493		6,055		476			1,493		6,531		8,024		1,342		1979		1998		40
304 Harper Drive		Mt. Laurel		NJ		1,220		657		2,674		446			657		3,120		3,777		726		1975		1998		40
305 Fellowship Drive		Mt. Laurel		NJ		2,576		1,421		5,768		789			1,421		6,557		7,978		1,621		1980		1998		40
305 Harper Drive		Mt. Laurel		NJ		367		223		913		1			223		914		1,137		162		1979		1998		40
307 Fellowship Drive		Mt. Laurel		NJ		2,643		1,565		6,342		276			1,565		6,618		8,183		1,327		1981		1998		40
308 Harper Drive		Mt. Laurel		NJ		—		1,643		6,663		432			1,643		7,095		8,738		1,291		1976		1998		40
309 Fellowship Drive		Mt. Laurel		NJ		2,783		1,518		6,154		945			1,518		7,099		8,617		1,442		1982		1998		40
33 West State Street		Trenton		NJ		—		6,016		24,091		105			6,016		24,196		30,212		4,825		1988		1998		40
426 Lancaster Avenue		Devon		PA		—		1,689		6,756		15			1,689		6,771		8,460		1,399		1990		1998		40
4364 South Alston Avenue		Durham		NC		2,846		1,622		6,419		771			1,622		7,190		8,812		1,292		1985		1998		40
4805 Lake Brooke Drive		Glen Allen		VA		4,134		1,640		6,567		121			1,640		6,688		8,328		1,192		1996		1998		40
50 East State Street		Trenton		NJ		—		8,926		35,735		546			8,926		36,281		45,207		7,239		1989		1998		40
50 Swedesford Square		Frazer		PA		6,304		3,902		15,254		365			3,902		15,619		19,521		2,769		1988		1998		40
500 Nationwide Drive		Harrisburg		PA		—		173		850		787			173		1,637		1,810		367		1977		1998		40
52 Swedesford Square		Frazer		PA		6,975		4,241		16,579		779			4,241		17,358		21,599		3,299		1986		1998		40
520 Virginia Drive		Ft. Washington		PA		—		845		3,455		380			845		3,835		4,680		975		1987		1998		40
600 Corporate Circle Drive		Harrisburg		PA		—		363		1,452		75			363		1,527		1,890		300		1978		1998		40
600 East Main Street		Richmond		VA		16,450		9,808		38,255		2,876			9,808		41,131		50,939		7,483		1986		1998		40
600 Park Avenue		King of Prussia		PA		—		1,012		4,048		3			1,012		4,051		5,063		810		1964		1998		40
610 Freedom Business Center		King of Prussia		PA		5,339		2,017		8,070		668			2,017		8,738		10,755		1,989		1985		1998		40
620 Allendale Road		King of Prussia		PA		—		1,020		3,839		980			1,020		4,819		5,839		1,034		1961		1998		40
620 Freedom Business Center		King of Prussia		PA		7,239		2,770		11,014		798			2,770		11,812		14,582		2,436		1986		1998		40
630 Clark Avenue		King of Prussia		PA		—		547		2,190		1			547		2,191		2,738		438		1960		1998		40
630 Freedom Business Center		King of Prussia		PA		7,138		2,773		11,144		460			2,773		11,604		14,377		2,566		1989		1998		40
640 Allendale Road		King of Prussia		PA		—		439		432		1,327			439		1,759		2,198		97		2001		1998		40
640 Freedom Business Center		King of Prussia		PA		11,203		4,222		16,891		1,453			4,222		18,344		22,566		3,769		1991		1998		40
650 Park Avenue		King of Prussia		PA		—		1,916		4,378		903			1,916		5,281		7,197		1,032		1968		1998		40
660 Allendale Road		King of Prussia		PA		—		396		3,343		(1,636	)		396		1,707		2,103		592		1962		1998		40
680 Allendale Road		King of Prussia		PA		—		689		2,756		678			689		3,434		4,123		784		1962		1998		40
700 East Gate Drive		Mt. Laurel		NJ		6,048		3,569		14,436		723			3,569		15,159		18,728		2,884		1984		1998		40
701 East Gate Drive		Mt. Laurel		NJ		2,971		1,736		6,877		588			1,736		7,465		9,201		1,326		1986		1998		40
7010 Snowdrift Way		Allentown		PA		1,370		818		3,324		101			818		3,425		4,243		612		1991		1998		40
7150 Windsor Drive		Allentown		PA		1,751		1,035		4,219		168			1,035		4,387		5,422		882		1988		1998		40
7350 Tilghman Street		Allentown		PA		—		3,414		13,716		1,087			3,414		14,803		18,217		3,049		1987		1998		40
741 First Avenue		King of Prussia		PA		—		1,287		5,151		210			1,287		5,361		6,648		1,069		1966		1998		40
7450 Tilghman Street		Allentown		PA		5,090		2,867		11,631		1,265			2,867		12,896		15,763		2,741		1986		1998		40

F-32

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Brandywine Realty Trust
Schedule III
Real Estate and Accumulated Depreciation
(in thousands)

							Initial Cost							Gross Amount at Which Carried December 31, 2003
	City		State		Encumberances at December 31, 2003		Land		Building and Improvements		Net Improvements (Retirements) Since Acquisition			Land		Building and Improvements		Total (a)		Accumulated Depreciation at December 31, 2003 (b)		Date of Construction		Date Acquired		Depreciable Life

751-761 Fifth Avenue		King of Prussia		PA		—		1,097		4,391		3			1,097		4,394		5,491		879		1967		1998		40
7535 Windsor Drive		Allentown		PA		5,659		3,376		13,400		747			3,376		14,147		17,523		2,609		1988		1998		40
755 Business Center Drive		Horsham		PA		2,156		1,362		2,334		646			1,362		2,980		4,342		935		1998		1998		40
800 Corporate Circle Drive		Harrisburg		PA		—		414		1,653		115			414		1,768		2,182		369		1979		1998		40
815 East Gate Drive		Mt. Laurel		NJ		1,078		636		2,584		119			636		2,703		3,339		569		1986		1998		40
817 East Gate Drive		Mt. Laurel		NJ		1,005		611		2,426		74			611		2,500		3,111		441		1986		1998		40
875 First Avenue		King of Prussia		PA		—		618		2,473		3,259			618		5,732		6,350		822		1966		1998		40
9011 Arboretum Parkway		Richmond		VA		4,884		1,857		7,702		279			1,857		7,981		9,838		1,492		1991		1998		40
9100 Arboretum Parkway		Richmond		VA		3,736		1,362		5,489		540			1,362		6,029		7,391		1,248		1988		1998		40
920 Harvest Drive		Blue Bell		PA		—		2,433		9,738		502			2,433		10,240		12,673		2,126		1990		1998		40
9200 Arboretum Parkway		Richmond		VA		2,634		985		3,973		253			985		4,226		5,211		792		1988		1998		40
9210 Arboretum Parkway		Richmond		VA		2,867		1,110		4,474		87			1,110		4,561		5,671		812		1988		1998		40
9211 Arboretum Parkway		Richmond		VA		1,536		582		2,433		78			582		2,511		3,093		444		1991		1998		40
922 Swedesford Road		Frazer		PA		—		218		1		(1	)		218		—		218		—		1986		1998		40
925 Harvest Drive		Blue Bell		PA		—		1,671		6,606		252			1,671		6,858		8,529		1,354		1990		1998		40
993 Lenox Drive		Lawrenceville		NJ		12,155		2,811		17,996		(5,986	)		2,811		12,010		14,821		2,361		1985		1998		40
997 Lenox Drive		Lawrenceville		NJ		10,095		2,410		9,700		199			2,410		9,899		12,309		2,040		1987		1998		40
Marine Center – Pier #12		Philadelphia		PA		—		—		—		356			—		356		356		48		1998		40
Marine Center – Pier #24		Philadelphia		PA		—		—		—		59			—		59		59		7		1998		40
Marine Center Pier #13-15		Philadelphia		PA		—		—		—		106			—		106		106		76		1998		40
Philadelphia Marine Center		Philadelphia		PA		—		532		2,196		37			532		2,233		2,765		395				1998		40
11 Campus Boulevard		Newtown Square		PA		4,775		1,112		4,067		595			1,112		4,662		5,774		720		1999		1999		40
2000 Lenox Drive		Lawrenceville		NJ		14,349		2,291		12,221		2,984			2,291		15,205		17,496		2,518		1999		1999		40
630 Allendale Road		King of Prussia		PA		19,797		2,836		4,028		15,961			2,836		19,989		22,825		2,654		1999		1999		40
630 Dresher Road		Horsham		PA		—		771		3,083		796			771		3,879		4,650		558		1987		1999		40
7130 Ambassador Drive		Allentown		PA		—		761		3,046		10			761		3,056		3,817		446		1991		1999		40
1050 Westlakes Drive		Berwyn		PA		—		2,611		10,445		1,762			2,611		12,207		14,818		1,765		1984		2000		40
1700 Paoli Pike		East Goshen		PA		—		458		559		2,923			458		3,482		3,940		233		2000		2000		40
10 Lake Center Drive		Marlton		NJ		—		1,880		7,521		366			1,880		7,887		9,767		577		1989		2001		40
100 Arrandale Boulevard		Exton		PA		—		970		3,878		2			970		3,880		4,850		267		1997		2001		40
100 Gateway Centre Parkway		Richmond		VA		—		391		5,410		1,256			391		6,666		7,057		724		2001		2001		40
100 Lindenwood Drive		Malvern		PA		—		473		1,892		527			473		2,419		2,892		178		1985		2001		40
101 Lindenwood Drive		Malvern		PA		—		4,152		16,606		171			4,152		16,777		20,929		1,171		1988		2001		40
1100 Cassett Road		Berwyn		PA		—		1,695		6,779		4			1,695		6,783		8,478		466		1997		2001		40
111 Arrandale Boulevard		Exton		PA		1,152		262		1,048		1			262		1,049		1,311		72		1996		2001		40
111/113 Pencader Drive		Newark		DE		—		1,092		4,366		3			1,092		4,369		5,461		300		1990		2001		40
1160 Swedesford Road		Berwyn		PA		—		1,781		7,124		430			1,781		7,554		9,335		640		1986		2001		40
1180 Swedesford Road		Berwyn		PA		—		2,086		8,342		345			2,086		8,687		10,773		651		1987		2001		40
161 Gaither Drive		Mt. Laurel		NJ		—		1,016		4,064		342			1,016		4,406		5,422		351		1987		2001		40
17 Campus Boulevard		Newtown Square		PA		5,197		1,108		5,155		22			1,108		5,177		6,285		625		2001		2001		40
200 Lake Drive East		Cherry Hill		NJ		—		2,069		8,275		168			2,069		8,443		10,512		597		1989		2001		40
200 Lindenwood Drive		Malvern		PA		—		324		1,295		2			324		1,297		1,621		89		1984		2001		40
210 Lake Drive East		Cherry Hill		NJ		—		1,645		6,579		164			1,645		6,743		8,388		475		1986		2001		40
220 Lake Drive East		Cherry Hill		NJ		—		2,144		8,798		514			2,144		9,312		11,456		781		1988		2001		40
30 Lake Center Drive		Marlton		NJ		—		1,043		4,171		145			1,043		4,316		5,359		303		1986		2001		40
300 Lindenwood Drive		Malvern		PA		—		848		3,394		237			848		3,631		4,479		233		1984		2001		40
301 Lindenwood Drive		Malvern		PA		—		2,729		10,915		648			2,729		11,563		14,292		839		1986		2001		40

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Brandywine Realty Trust
Schedule III
Real Estate and Accumulated Depreciation
(in thousands)

							Initial Cost						Gross Amount at Which Carried December 31, 2003
	City		State		Encumb- erances at December 31, 2003		Land		Building and Improvements		Net Improvements (Retirements) Since Acquisition		Land		Building and Improvements		Total (a)		Accumulated Depreciation at December 31, 2003 (b)		Date of Construction		Date Acquired		Depreciable Life

412 Creamery Way		Exton		PA		—		1,195		4,779		436		1,195		5,215		6,410		437		1999		2001		40
429 Creamery Way		Exton		PA		3,235		1,368		5,471		3		1,368		5,474		6,842		376		1996		2001		40
436 Creamery Way		Exton		PA		—		994		3,978		14		994		3,992		4,986		279		1991		2001		40
440 Creamery Way		Exton		PA		3,093		982		3,927		87		982		4,014		4,996		296		1991		2001		40
442 Creamery Way		Exton		PA		2,769		894		3,576		2		894		3,578		4,472		246		1991		2001		40
457 Creamery Way		Exton		PA		—		777		3,107		2		777		3,109		3,886		214		1990		2001		40
467 Creamery Way		Exton		PA		—		906		3,623		2		906		3,625		4,531		249		1988		2001		40
479 Thomas Jones Way		Exton		PA		—		1,075		4,299		260		1,075		4,559		5,634		346		1988		2001		40
481 John Young Way		Exton		PA		2,475		496		1,983		2		496		1,985		2,481		136		1997		2001		40
555 Croton Road		King of Prussia		PA		6,209		4,486		17,943		121		4,486		18,064		22,550		1,261		1999		2001		40
7360 Windsor Drive		Allentown		PA		—		1,451		3,618		2,039		1,451		5,657		7,108		708		2001		2001		40
Two Righter Parkway		Wilmington		DE		—		2,802		11,217		7		2,802		11,224		14,026		1,001		1987		2001		40
100 Brandywine Boulevard		Newtown		PA		—		1,784		9,811		2,971		1,784		12,782		14,566		767		2002		2002		40
1000 Lenox Drive		Lawrenceville		NJ		—		1,174		4,696		3		1,174		4,699		5,873		176		1982		2002		40
15 Campus Boulevard		West Goshen		PA		5,943		1,164		3,896		2,127		1,164		6,023		7,187		532		2002		2002		40
200 Commerce Drive		Newark		DE		6,165		911		4,414		1,552		911		5,966		6,877		877		1998		2002		40
400 Berwyn Park		Berwyn		PA		15,726		2,657		4,462		12,947		2,657		17,409		20,066		1,105		2002		2002		40
400 Commerce Drive		Newark		DE		12,346		2,528		9,220		4,495		2,528		13,715		16,243		2,381		1997		2002		40
401 Plymouth Road		Plymouth Meeting		PA		—		6,198		16,131		16,467		6,198		32,598		38,796		2,327		2002		2002		40
600 Plymouth Mtg Exec Campus		Plymouth Meeting		PA		12,439		3,652		15,288		266		3,652		15,554		19,206		726		1986		2002		40
980 Harvest Drive		Blue Bell		PA		—		2,079		7,821		27		2,079		7,848		9,927		266		1988		2002		40
Four Plymouth Mtg Exec Campus		Plymouth Meeting		PA		11,791		3,572		14,435		198		3,572		14,633		18,205		691		1990		2002		40
Three Plymouth Mtg Exec Campus		Plymouth Meeting		PA		12,078		3,558		14,743		348		3,558		15,091		18,649		713		1988		2002		40
Two Paragon Place		Richmond		VA		—		2,917		11,454		760		2,917		12,214		15,131		548		1989		2002		40
Two Plymouth Mtg Exec Campus		Plymouth Meeting		PA		11,991		3,651		14,514		349		3,651		14,863		18,514		786		1987		2002		40
565 East Swedesford Road		Wayne		PA		—		1,872		7,489		5		1,872		7,494		9,366		31		1984		2003		40
575 East Swedesford Road		Wayne		PA		—		2,178		8,712		6		2,178		8,718		10,896		36		1985		2003		40
585 East Swedesford Road		Wayne		PA		—		1,350		5,401		3		1,350		5,404		6,754		23		1998		2003		40
595 East Swedesford Road		Wayne		PA		—		2,729		10,917		7		2,729		10,924		13,653		45		1988		2003		40
935 First Avenue		King of Prussia		PA		—		3,255		11,693		7		3,255		11,700		14,955		156		2001		2003		40
989 Lenox Drive		Lawrenceville		NJ		—		3,701		14,802		8		3,701		14,810		18,511		—		1982		2003		40

					$	456,402	$	345,022	$	1,380,642	$	144,080	$	345,022	$	1,524,722	$	1,869,744	$	268,091

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(a)	Reconciliation of Real Estate:


	The following table reconciles the real estate investments from January 1, 2002 to December 31, 2003 (in thousands):

	2003			2002			2001

Balance at beginning of year	$	1,890,009		$	1,893,039		$	1,754,895
Additions:
Acquisitions		59,149			120,627			217,212
Capital expenditures		57,721			94,086			65,210
Less:
Dispositions		(135,118	)		(209,014	)		(144,278)
Assets transferred to held-for-sale		(2,017	)		(8,729	)		—

Balance at end of year	$	1,869,744		$	1,890,009		$	1,893,039


(b)	Reconciliation of Accumulated Depreciation:


	The following table reconciles the accumulated depreciation on real estate investments from January 1, 2003 to December 31, 2003 (in thousands):

	2003			2002			2001

Balance at beginning of year	$	245,230		$	230,793		$	179,558
Additions:
Depreciation expense – continued operations		51,191			46,190			59,348
Depreciation expense – discontinued operations		695			2,511			10,147
Acquisitions		—			1,175			—
Less:
Dispositions		(28,663	)		(34,204	)		(18,260)
Assets transferred to held-for-sale		(362	)		(1,235	)		—

Balance at end of year	$	268,091		$	245,230		$	230,793

F-35

Exhibit 10.14 SEVENTH AMENDMENT TO AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF BRANDYWINE OPERATING PARTNERSHIP, L.P. THIS SEVENTH AMENDMENT, dated as of December 31, 1998 (the "Amendment"), amends the Amended and Restated Agreement of Limited Partnership (as heretofore amended to date, the "Partnership Agreement") of BRANDYWINE OPERATING PARTNERSHIP, L.P., a Delaware limited partnership (the "Partnership"). Capitalized terms used herein but not defined herein shall have the meanings given such terms in the Partnership Agreement. BACKGROUND A. Pursuant to the Partnership Agreement, Brandywine Realty Trust (the "General Partner"), as the general partner of the Partnership, has the power and authority to issue additional Partnership Interests to persons on such terms and conditions as the General Partner may deem appropriate. B. The General Partner, pursuant to the exercise of such power and authority and in accordance with the Partnership Agreement, has determined to execute this Amendment to the Partnership Agreement to evidence the issuance of additional Partnership Interests and the admission of the other signatories hereto as Limited Partners of the Partnership in exchange for certain contributions of partnership interests in partnerships holding real estate and real estate related assets that are being made to the Partnership on the date hereof pursuant to a "contribution" agreement (relating to a property commonly known as Interstate Center) among the Partnership, the General Partner and the Admitted Partners (as defined below). NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby amend the Partnership Agreement as follows: 1. The Partnership Agreement is hereby amended to reflect the admission as a Limited Partner on the date hereof of the Persons set forth on Schedule A attached hereto (the "Admitted Partners") and the ownership by such Persons of the number of Class A Units listed opposite each Person's name on Schedule A. Attached as Schedule B is a list of the Partners of the Partnership prior to the admission of the Admitted Partners, together with the number and class of Partnership Interests owned by such partners.

2. The Partnership Interests issued hereby shall constitute Class A Units; provided that any distribution to be received by the Admitted Partners on the Class A Units issued to them on the date hereof on account of the fiscal quarter in which they are admitted to the Partnership shall be pro-rated to reflect the portion of the fiscal quarter of the Partnership for which the Admitted Partners held such Class A Units and shall not be pro-rata in accordance with their then Percentage Interests; provided further that the Redemption Right granted to holders of Class A Units in Article XV of the Partnership Agreement shall not be exercisable by the holders of the Class A Units issued on the date hereof to the Admitted Partners until 180 days after the date hereof, except that, (i) if the holder of any such Class A Units dies, such holder's estate shall thereupon be permitted to exercise the Redemption Right with respect to all of such Class A Units held by it notwithstanding the foregoing restriction and (ii) if a Change of Control (as defined below) of the General Partner occurs, the foregoing restriction on exercise of the Redemption Right shall automatically terminate with respect to all of such Class A Units. 3. As used herein, the term "Change of Control" shall mean Change of Control" means: (i) the acquisition in one or more transactions by any "Person" (as the term person is used for purposes of Sections 13(d) or 14(d) of the Exchange Act) of "Beneficial ownership" (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty-five percent (25%) or more of the combined voting power of the General Partner's then outstanding voting securities (the "Voting Securities"), provided that for purposes of this clause (i) Voting Securities acquired directly from the General Partner by any Person shall be excluded from the determination of such Person's Beneficial ownership of Voting Securities (but such Voting Securities shall be included in the calculation of the total number of Voting Securities then outstanding); or (ii) approval by shareholders of the General Partner of: (A) a merger, reorganization or consolidation involving the General Partner if the shareholders of the General Partner immediately before such merger, reorganization or consolidation do not or will not own directly or indirectly immediately following such merger, reorganization or consolidation, more than fifty percent (50%) of the combined voting power of the outstanding voting securities of the General Partner resulting from or surviving such merger, reorganization or consolidation in substantially the same proportion as their ownership of the Voting Securities outstanding immediately before such merger, reorganization or consolidation; or (B) a complete liquidation or dissolution of the General Partner; or (C) an agreement for the sale or other disposition of all or substantially all of the assets of the General Partner; or -2-

(iii) acceptance by shareholders of the General Partner of shares in a share exchange if the shareholders of the General Partner immediately before such share exchange do not or will not own directly or indirectly immediately following such share exchange more than fifty percent (50%) of the combined voting power of the outstanding voting securities of the entity resulting from or surviving such share exchange in substantially the same proportion as their ownership of the Voting Securities outstanding immediately before such share exchange. 4. By execution of this Amendment to the Partnership Agreement by the General Partner and the Admitted Partners, the Admitted Partners agree to be bound by each and every term of the Partnership Agreement as amended from time to time in accordance with the terms of the Partnership Agreement. 5. On the date of this Amendment, each of the Admitted Partners shall execute and deliver to Brandywine Realty Trust an Irrevocable Proxy coupled with an Interest in the form set forth on Exhibit 1 hereto attached. 6. This Amendment may be executed in one or more counterparts, each such counterpart being deemed to be an original instrument, and all such counterparts together constituting the same agreement. 7. Except as expressly set forth in this Amendment to the Partnership Agreement, the Partnership Agreement is hereby ratified and confirmed in each and every respect. IN WITNESS WHEREOF, this Amendment to the Partnership Agreement has been executed and delivered as of the date first above written. GENERAL PARTNER: BRANDYWINE REALTY TRUST By: ------------------------------------ Gerard H. Sweeney, President and CEO ADMITTED PARTNERS: ----------------------------------------- William H. Godwin, Jr. ----------------------------------------- Bryson Powell -3-

SCHEDULE "A" NUMBER OF ADMITTED PARTNERSHIP PARTNERS INTERESTS -------- --------- William H. Godwin, Jr. 41,734 Bryson Powell 41,734 -4-

SCHEDULE "B " BRANDYWINE OPERATING PARTNERSHIP, L.P. OUTSTANDING PARTNERSHIP INTERESTS AS OF DECEMBER 31, 1998 NUMBER OF PARTNERSHIP INTERESTS (ALL CLASS A UNITS LIMITED PARTNERS UNLESS OTHERWISE INDICATED) - ---------------- --------------------------- The Nichols Company 2,742 Brian F. Belcher 7,245 Jack R. Loew 1,245 Craig C. Hough 1,245 Werner A. Fricker 6,830 Randle Scarborough 59,578 Sean Scarborough 60,576 Steven L. Shapiro 1,902 Robert K. Scarborough 215,384 Raymond J. Perkins 2,536 Brandywine Holdings I, Inc. 5 Brandywine Realty Trust 467,220 Brookstone Investors, L.L.C. 57,126 Brookstone Holdings of Del.-4, L.L.C. 7,579 Brookstone Holdings of Del.-5, L.L.C. 80,445 Brookstone Holdings of Del.-6, L.L.C. 7,886 John S. Trogner, Sr. 89,801.232 John S. Trogner, Jr. 73,048.310 Blair S. Trogner, Sr. 138,126.471 Emma B. Trogner 27,087.416 Ronalee Trogner 21,669.933 Candis C. Trogner 40,631.123 Donald E. Axinn 928,651 Morris Green 50,233 Arthur and Marion Eberstein, Joint Tenants 7,513 Lennard Axinn 2,156 Trust UTW of Theodore Geffner 485 Howard Kantor 31,505 Irving Hirschman Family Trust 1,488 Leo Guthart 876 Gloria Kantor 21,647 Richard Bernhard 40,927 Calvin Axinn 40,927 Helen Geffner 1,488 Brandywine Realty Trust 750,000 Series A Preferred Mirror Units Commonwealth Atlantic Operating Properties Inc. 1,140,527 Series B Preferred Units Commonwealth Atlantic Land II Inc. 283,731 Series B Preferred Units Commonwealth Atlantic Development Inc. 43,725 Series B Preferred Units Commonwealth Atlantic Land Company 82,017 Series B Preferred Units GENERAL PARTNER NUMBER OF PARTNERSHIP INTERESTS - --------------- ------------------------------- Brandywine Realty Trust 37,549,713 GP Units -5-

EXHIBIT 1 IRREVOCABLE PROXY COUPLED WITH AN INTEREST KNOWN ALL MEN BY THESE PRESENTS, that the undersigned hereby irrevocably constitutes and appoints the General Partner, any Liquidating Trustee, and authorized officers and attorneys-in-fact of each, and each of those acting singly, in each case with full power of substitution, as its true and lawful agent and attorney-in-fact, with full power and authority in its name, place and stead to: execute, swear to, acknowledge, deliver, file and record in the appropriate public offices (i) all certificates, documents and other instruments (including, without limitation, this Agreement and the Certificate and all amendments or restatements thereof) that the General Partner or the Liquidating Trustee deems appropriate or necessary to form, qualify or continue the existence or qualification of the Partnership as a limited partnership (or a partnership in which the limited partners have limited liability) in the State of Delaware and in all other jurisdictions in which the Partnership may conduct business or own property; (ii) all instruments that the General Partner deems appropriate or necessary to reflect any amendment, change, modification or restatement of this Agreement in accordance with its terms; (iii) all conveyances and other instruments or documents that the General Partner deems appropriate or necessary to reflect the dissolution and liquidation of the Partnership pursuant to the terms of this Agreement, including, without limitation, a certificate of cancellation; and (iv) all instruments relating to the admission, withdrawal, removal or substitution of any Partner pursuant to the provisions of this Agreement, or the Capital Contribution of any Partner. The foregoing power of attorney is irrevocable and a power coupled with an interest, in recognition of the fact that each of the Partners will be relying upon the power of the General Partner to act as contemplated by this Agreement in any filing or other action by it on behalf of the Partnership, and it shall survive the death, incapacity or incompetency of a Limited Partner to the effect and extent permitted by law and the Transfer of all or any portion of such Limited Partner's Partnership Units and shall extend to such Limited Partner's heirs, distributees, successors, assigns and personal representatives. IN WITNESS WHEREOF, the undersigned has executed and delivered this Proxy on this 31st day of December, 1998. --------------------------------- William H. Godwin, Jr. -6-

Exhibit 10.15 EIGHTH AMENDMENT TO AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF BRANDYWINE OPERATING PARTNERSHIP, L.P. THIS EIGHTH AMENDMENT, dated as of April 19, 1999 (the "Amendment"), amends the Amended and Restated Agreement of Limited Partnership Agreement (as heretofore amended to date, the "Partnership Agreement") of BRANDYWINE OPERATING PARTNERSHIP, L.P., a Delaware limited partnership (the "Partnership"). Capitalized terms used herein but not defined herein shall have the meanings given to such terms in the Partnership Agreement. BACKGROUND ---------- A. Pursuant to the Partnership Agreement, Brandywine Realty Trust (the "General Partner"), as the general partner of the Partnership, has the power and authority to issue additional Partnership Interests and Units in one or more newly created classes of Partnership Interests to persons on such terms and conditions as the General Partner may deem appropriate. B. The General Partner, pursuant to the exercise of such power and authority and in accordance with the Partnership Agreement, has determined to execute this Amendment to the Partnership Agreement to create a new class of Partnership Interests designated as the Series C Preferred Mirror Units having designations, preferences and other rights which are substantially the same as the economic rights of the 8.75% Series B Senior Cumulative Convertible Preferred Shares of the General Partner (the "Series B Preferred Shares") and to evidence the issuance of such additional Partnership Interests to the General Partner in exchange for the General Partner's contribution to the Partnership of the net proceeds of the sale of the Series B Preferred Shares. NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby amend the Partnership Agreement as follows: 8. In accordance with the Partnership Agreement, the Partnership Agreement is hereby amended to establish, and to issue to the General Partner, the Series C Preferred Mirror Units having the designations, preferences and other rights set forth below: (i) Designation and Number. A class of Partnership Interests designated as Series C Preferred Mirror Units is hereby established. The number of Series C Preferred Mirror Units shall be 4,375,000. The stated value of each Series C Preferred Mirror Unit shall be $24.00 (the "Stated Value").

(ii) Rank. The Series C Preferred Mirror Units will, with respect to distribution rights and rights upon liquidation, dissolution or winding up of the Partnership, rank (a) senior to the Class A Units and all Partnership Interests ranking junior to the Series C Preferred Mirror Units; (b) on a parity with all Partnership Interests issued by the Partnership the terms of which specifically provide that such Partnership Interests rank on a parity with the Series C Preferred Mirror Units including the Partnership Interests designated as Series A Preferred Mirror Units and Series B Preferred Units; and (c) junior to all Partnership Interests issued by the Partnership the terms of which specifically provide that such Partnership Interests rank senior to the Series C Preferred Mirror Units. (iii) Distributions. (A) Pursuant to Section 6.1 of the Partnership Agreement, holders of Series C Preferred Mirror Units shall be entitled to receive, out of funds legally available therefor, cumulative quarterly cash distributions equal to the amount of the cumulative quarterly cash distributions payable on the Series C Preferred Shares. Such distributions shall be payable quarterly in arrears on or before the date on which distributions on the Series B Preferred Shares are payable (each a "Series C Preferred Mirror Unit Distribution Payment Date"). (B) No distributions on Series C Preferred Mirror Units shall be authorized or paid or set apart for payment by the Partnership at such time as the terms and provisions of any agreement of the Partnership, including any agreement relating to its indebtedness, prohibits such authorization, payment or setting apart for payment or provides that such authorization, payment or setting apart for payment would constitute a breach thereof, or a default thereunder, or if such authorization or payment shall be restricted or prohibited by law. (C) Notwithstanding the foregoing, distributions with respect to the Series C Preferred Mirror Units will accrue whether or not the terms and provisions set forth in Section 1(c)(ii) at any time prohibit the current payment of distributions, whether or not there are funds legally available for such distributions and whether or not such distributions are authorized. Accrued but unpaid distributions on the Series C Preferred Mirror Units will accumulate as of the Series C Preferred Mirror Unit Distribution Payment Date on which they first become payable.

(D) When distributions are not paid in full (or a sum sufficient for such full payment is not so set apart) upon the Series C Preferred Mirror Units and any other Partnership Interests ranking on a parity as to distributions with the Series C Preferred Mirror Units, including the Series A Preferred Mirror Units and the Series B Preferred Units, all distributions authorized upon the Series C Preferred Mirror Units and any other Partnership Interests ranking on a parity as to distributions with the Series C Preferred Mirror Units shall be authorized pro rata so that the amount of distributions authorized per Partnership Unit of Series C Preferred Mirror Units and such other Partnership Interests shall in all cases bear to each other the same ratio that accrued distributions per Partnership Unit on the Series C Preferred Mirror Units and such other Partnership Interests (which shall not, with respect to such other Partnership Interests, include any accrual in respect of unpaid distributions for prior distribution periods if such other Partnership Interests do not have a cumulative distribution) bear to each other. Any distribution payment or payments on Series C Preferred Mirror Units which may be in arrears shall accrue distributions at the rate of 8.75% per annum. (E) Except as provided in Section 1(c)(iv), unless full cumulative distributions on the Series C Preferred Mirror Units have been or contemporaneously are authorized and paid or authorized and a sum sufficient for the payment thereof is set apart for payment for all past distribution periods and the then current distribution period, no distributions (other than in Partnership Interests ranking junior to the Series C Preferred Mirror Units as to distributions and upon liquidation, dissolution or winding up) shall be authorized or paid or set aside for payment nor shall any other distribution be authorized or made upon the Class A Units, the Series A Preferred Mirror Units or the Series B Preferred Units or any other Partnership Interests ranking junior to or on a parity with the Series C Preferred Mirror Units as to distributions or upon liquidation, dissolution or winding up, nor shall any Class A Units, Series A Preferred Mirror Units or the Series B Preferred Units or any other Partnership Interests ranking junior to or on a parity with the Series C Preferred Shares as to distributions or upon liquidation be redeemed, purchased or otherwise acquired for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any such units or other Partnership Interests) by the Partnership or any other entity controlled directly or indirectly by the Partnership (except by conversion into or exchange for Partnership Interests ranking junior to the Series C Preferred Mirror Units as to distributions and upon liquidation, dissolution or winding up).

(F) Holders of the Series C Preferred Mirror Units shall not be entitled to any distribution, whether payable in cash, property or Partnership Units in excess of full cumulative distributions on the Series C Preferred Mirror Units as described above. Any distribution payment made on the Series C Preferred Mirror Units shall first be credited against the earliest accrued but unpaid distribution due with respect to such Series C Preferred Mirror Units which remains payable. (iv) Liquidation Preference. (A) Upon any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Partnership, the holders of Series C Preferred Mirror Units then outstanding are entitled to be paid out of the assets of the Partnership available for distribution to the Partners pursuant to Section 13.5(a) of the Partnership Agreement a liquidation preference equal to the Stated Value per Series C Preferred Mirror Unit, plus an amount equal to any accrued and unpaid distributions to the date of payment, before any distribution of assets is made to holders of Class A Units and GP Units or any other Partnership Interests that rank junior to the Series A Preferred Mirror Units upon liquidation, dissolution or winding up. (B) In the event that, upon any such voluntary or involuntary liquidation, dissolution or winding up, the available assets of the Partnership are insufficient to pay the amount of the liquidating distributions on all outstanding Series C Preferred Mirror Units and the corresponding amounts payable on all other Partnership Interests ranking on a parity with the Series C Preferred Mirror Units in the distribution of assets, including the Series A Preferred Mirror Units and the Series B Preferred Units then such assets shall be allocated among the Series C Preferred Mirror Units, as a class, and each class or series of such other such Partnership Interests, as classes, in proportion to the full liquidating distributions to which they would otherwise be respectively entitled.

(C) After payment of the full amount of the liquidating distributions to which they are entitled, the holders of Series C Preferred Mirror Units will have no right or claim to any of the remaining assets of the Partnership. (D) The consolidation or merger of the Partnership with or into any other partnership, corporation, trust or entity or of any other partnership, corporation, trust or other entity with or into the Partnership, or the sale, lease or conveyance of all or substantially all of the property or business of the Partnership, shall not be deemed to constitute a liquidation, dissolution or winding up of the Partnership for purposes of this Section 1(d). (v) Redemption. In connection with a redemption by the General Partner of any or all of the Series B Preferred Shares, the Partnership shall provide cash to the General Partner for such purpose which shall be equal to the redemption price (including accrued and unpaid distributions) of the Series B Preferred Shares to be redeemed and in exchange one Series C Preferred Mirror Unit shall be canceled with respect to each Series B Preferred Share so redeemed. From and after the date on which the Series B Preferred Shares are redeemed, the Series C Preferred Mirror Units so canceled shall no longer be outstanding and all rights hereunder, to distributions or otherwise, with respect to such Series C Preferred Mirror Units shall cease. (vi) Conversion. In connection with, and at the time of, the conversion of all or any Series B Preferred Shares into Common Shares, a number of Series B Preferred Mirror Units equal to the number of Series B Preferred Shares so converted shall be converted into a number of Class A Units equal to the number of Common Shares issued upon such conversion. (vii) Allocations. Allocations of the Partnership's items of income, gain, loss and deduction shall be allocated among holders of Series C Preferred Mirror Units in accordance with Article VII of the Partnership Agreement. 9. Subparagraph (g) of Section 7.2 of the Partnership Agreement is amended and restated in its entirety as follows: (i) Priority Allocation. All or a portion of the Net Income of the Partnership for the Fiscal Year, if any, shall be specially allocated to the Partners holding Series A Preferred Mirror Units, Series B Preferred Units and Series C Preferred Mirror Units in proportion to the cumulative distributions each has received pursuant to Sections 6.1, 6.2, and 13.5

hereof and, with respect to the Partners holding Series A Preferred Mirror Units, Section 1(c) and 1(d) of the Fourth Amendment to this Agreement or, with respect to Partners holding Series B Preferred Units, Section 1.C and 1.D of the Fifth Amendment to this Agreement, or, with respect of the Partner holding Series C Preferred Mirror Units, Section 1(c) and 1(d) of the Eighth Amendment to this Agreement from the commencement of the Partnership to the end of such Fiscal Year, in an amount equal to the excess, if any, of the sum of (i) the aggregate Net Loss allocated to such Partners pursuant to Section 7.1(b) hereof for all prior Fiscal Years, if any, and (ii) the aggregate distributions received by such Partners pursuant to Sections 6.1, 6.2, and 13.5 of this Agreement and, with respect to Partners holding Series A Preferred Mirror Units, Section 1(c) and 1(d) of the Fourth Amendment to this Agreement or, with respect to Partners holding Series B Preferred Units, Section 1.C and 1.D of the Fifth Amendment to this Agreement, or, with respect to Partners holding Series C Preferred Mirror Units, Section 1(c) and 1(d) of the Eighth Amendment to this Agreement from the commencement of the Partnership to the end of such Fiscal Year, over the aggregate items of Net Income allocated to such Partners pursuant to this Section 7.2(g) for all prior Fiscal Years. 10. Except as expressly set forth in this Amendment to the Partnership Agreement, the Partnership Agreement is hereby ratified and confirmed in each and every respect. IN WITNESS WHEREOF, this Amendment to the Partnership Agreement has been executed and delivered as of the date first above written. GENERAL PARTNER: BRANDYWINE REALTY TRUST By: --------------------------------------- Name: Gerard H. Sweeney Its: President and Chief Executive Officer

Exhibit 10.16 NINTH AMENDMENT TO AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF BRANDYWINE OPERATING PARTNERSHIP, L.P. THIS NINTH AMENDMENT, dated as of May 7, 1999 (the "Amendment"), further amends the Amended and Restated Agreement of Limited Partnership Agreement (as amended to date, the "Partnership Agreement") of BRANDYWINE OPERATING PARTNERSHIP, L.P., a Delaware limited partnership (the "Partnership"). Capitalized terms used herein but not defined herein shall have the meanings given such terms in the Partnership Agreement. BACKGROUND ---------- C. Pursuant to the Partnership Agreement, Brandywine Realty Trust (the "General Partner"), as the general partner of the Partnership, has the power and authority to issue additional Partnership Interests to persons on such terms and conditions as the General Partner may deem appropriate. D. The General Partner, pursuant to the exercise of such power and authority and in accordance with the Partnership Agreement, has determined to execute this Amendment to the Partnership Agreement to evidence the issuance of additional Partnership Interests and the admission of the other signatories hereto as Limited Partners of the Partnership in exchange for certain contributions of interests in real estate and real estate related assets that are being made to the Partnership on the date hereof pursuant to a "contribution" agreement (relating to properties owned by persons and entities that include Donald E. Axinn and affiliates) among the Partnership and the other signatories thereto. NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby amend the Partnership Agreement as follows: 1. The Partnership Agreement is hereby amended to reflect the admission as a Limited Partner on the date hereof of the Persons set forth on Schedule A attached hereto (the "Admitted Partners") and the ownership by such Persons of the number of Class A Units listed opposite each Person's name on Schedule A. Attached as Schedule B is a list of the Partners of the Partnership prior to the admission of the Admitted Partners, together with the number and class of Partnership Interests owned by such partners. 2. The Partnership Interests issued hereby shall constitute Class A Units; provided that any distribution to be received by the Admitted Partners on the Class A Units issued to them on the date hereof on account of the fiscal quarter in which they are admitted to the Partnership shall be pro-rated to reflect the portion of the fiscal quarter of the Partnership for which the Admitted Partners held such Class A Units and shall not be pro-rata in

accordance with their then Percentage Interests; provided further that the Redemption Right granted to holders of Class A Units in Article XV of the Partnership Agreement shall not be exercisable by the holders of the Class A Units issued on the date hereof to the Admitted Partners until the first anniversary of the date hereof, except that (i) if the holder of any such Class A Units dies, such holder's estate shall thereupon be permitted to exercise the Redemption Right with respect to all of such Class A Units held by it notwithstanding the foregoing restriction and (ii) if a Change of Control (as defined below) of the General Partner occurs, the foregoing restriction on exercise of the Redemption Right shall automatically terminate with respect to all of such Class A Units. Notwithstanding anything contained in the Partnership Agreement or this Amendment, if the holder of Class A Units exercises its Redemption Right and the General Partner or the holder reasonably believes that the issuance of Common Shares in satisfaction of the Redemption Right would require a notification and filing under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), the obligation of the Partnership and the General Partner to satisfy the Redemption Right may be suspended until applicable filings with the Federal Trade Commission and the Antitrust Division of the Department of Justice have been made and the applicable waiting periods have expired. The General Partner agrees to use commercially reasonable efforts to make any requisite filings under the HSR Act in order to promptly obtain expiration of the applicable waiting periods, and the Partnership and the applicable holder of Class A Units shall split equally any filing fees that may be payable under the HSR Act. 3. As used herein, the term "Change of Control" shall mean Change of Control" means: (i) the acquisition in one or more transactions by any "Person" (as the term person is used for purposes of Sections 13(d) or 14(d) of the Exchange Act) of "Beneficial ownership" (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty-five percent (25%) or more of the combined voting power of the General Partner's then outstanding voting securities (the "Voting Securities"), provided that for purposes of this clause (i) Voting Securities acquired directly from the General Partner by any Person shall be excluded from the determination of such Person's Beneficial ownership of Voting Securities (but such Voting Securities shall be included in the calculation of the total number of Voting Securities then outstanding); or (ii) approval by shareholders of the General Partner of: (A) a merger, reorganization or consolidation involving the General Partner if the shareholders of the General Partner immediately before such merger, reorganization or consolidation do not or will not own directly or indirectly immediately following such merger, reorganization or consolidation, more than fifty percent (50%) of the combined voting power of the outstanding voting securities of the General Partner resulting from or surviving such merger, reorganization or consolidation in substantially the same proportion as their ownership of the Voting Securities outstanding immediately before such merger, reorganization or consolidation; or

(B) a complete liquidation or dissolution of the General Partner; or (C) an agreement for the sale or other disposition of all or substantially all of the assets of the General Partner; or (iii) acceptance by shareholders of the General Partner of shares in a share exchange if the shareholders of the General Partner immediately before such share exchange do not or will not own directly or indirectly immediately following such share exchange more than fifty percent (50%) of the combined voting power of the outstanding voting securities of the entity resulting from or surviving such share exchange in substantially the same proportion as their ownership of the Voting Securities outstanding immediately before such share exchange. 4. By execution of this Amendment to the Partnership Agreement by the General Partner, the Admitted Partners agree to be bound by each and every term of the Partnership Agreement as amended from time to time in accordance with the terms of the Partnership Agreement. The General Partner confirms that the provisions in Section 18.1(a) of the Partnership Agreement shall apply to the Admitted Partners notwithstanding Section 18.7 of the Partnership Agreement. 5. On the date of this Amendment, each of the Admitted Partners shall execute and deliver to Brandywine Realty Trust an Irrevocable Proxy coupled with an Interest in the form set forth on Exhibit 1 hereto attached. 6. Except as expressly set forth in this Amendment to the Partnership Agreement, the Partnership Agreement is hereby ratified and confirmed in each and every respect.

IN WITNESS WHEREOF, this Amendment to the Partnership Agreement has been executed and delivered as of the date first above written. GENERAL PARTNER: --------------- BRANDYWINE REALTY TRUST By: --------------------------------------- Gerard H. Sweeney President and Chief Executive Officer ADMITTED PARTNERS: ----------------- ------------------------------------------ Donald E. Axinn, individually

SCHEDULE "A" NUMBER OF ADMITTED PARTNERSHIP PARTNERS INTERESTS -------- ----------- Donald E. Axinn

SCHEDULE "B" BRANDYWINE OPERATING PARTNERSHIP, L.P. OUTSTANDING PARTNERSHIP INTERESTS AS OF MAY 7, 1999 NUMBER OF PARTNERSHIP INTERESTS (ALL CLASS A UNITS, LIMITED PARTNERS UNLESS OTHERWISE INDICATED) - ---------------- --------------------------- The Nichols Company 2,742 Brian F. Belcher 7,245 Jack R. Loew 1,245 Craig C. Hough 1,245 Werner A. Fricker 6,830 Randle Scarborough 59,578 Sean Scarborough 60,576 Steven L. Shapiro 1,902 Robert K. Scarborough 215,384 Raymond J. Perkins 2,536 Brandywine Holdings I, Inc. 5 Brandywine Realty Trust 467,220 Brookstone Investors, L.L.C. 57,126 Brookstone Holdings of Del.-4, L.L.C. 7,579 Brookstone Holdings of Del.-5, L.L.C. 80,445 Brookstone Holdings of Del.-6, L.L.C. 7,886 John S. Trogner, Sr. 89,801.232 John S. Trogner, Jr. 73,048.310 Blair S. Trogner, Sr. 138,126.471 Emma B. Trogner 27,087.416 Ronalee Trogner 21,669.933 Candis C. Trogner 40,631.123 Arthur and Marion Eberstein 7,513 Calvin Axinn 40,927 Estate Irving Hirshman 1,488 Trust UTW of Theodore Geffner 485 Gloria Kantor 21,647 Helen Geffner 1,488 Howard Kantor 31,505 Leo Guthart 876 Morris Green 50,233 Richard Bernhard 40,927 Lennard Axinn 2,156 Donald E. Axinn 928,651 William H. Goodwin, Jr. 41,734 Bryson Powell 41,734 Brandywine Realty Trust 750,000 Series A Preferred Mirror Units

NUMBER OF PARTNERSHIP INTERESTS (ALL CLASS A UNITS, LIMITED PARTNERS UNLESS OTHERWISE INDICATED) - ---------------- --------------------------- Commonwealth Atlantic Operating Properties Inc. 1,140,527 Series B Preferred Units Commonwealth Atlantic Land II Inc. 283,731 Series B Preferred Units Commonwealth Atlantic Development Inc. 43,725 Series B Preferred Units Commonwealth Atlantic Land Company 82,017 Series B Preferred Units Brandywine Realty Trust 1,041,667 Series C Preferred Mirror Units GENERAL PARTNER NUMBER OF PARTNERSHIP INTERESTS - --------------- ------------------------------- Brandywine Realty Trust 37,544,430 GP Units

EXHIBIT "1" IRREVOCABLE PROXY COUPLED WITH AN INTEREST KNOWN ALL MEN BY THESE PRESENTS, that the undersigned hereby irrevocably constitutes and appoints the General Partner, any Liquidating Trustee, and authorized officers and attorneys-in-fact of each, and each of those acting singly, in each case with full power of substitution, as its true and lawful agent and attorney-in-fact, with full power and authority in its name, place and stead to: execute, swear to, acknowledge, deliver, file and record in the appropriate public offices (i) all certificates, documents and other instruments (including, without limitation, this Agreement and the Certificate and all amendments or restatements thereof) that the General Partner or the Liquidating Trustee deems appropriate or necessary to form, qualify or continue the existence or qualification of the Partnership as a limited partnership (or a partnership in which the limited partners have limited liability) in the State of Delaware and in all other jurisdictions in which the Partnership may conduct business or own property; (ii) all instruments that the General Partner deems appropriate or necessary to reflect any amendment, change, modification or restatement of this Agreement in accordance with the terms of this Agreement; (iii) all conveyances and other instruments or documents that the General Partner deems appropriate or necessary to reflect the dissolution and liquidation of the Partnership pursuant to the terms of this Agreement, including, without limitation, a certificate of cancellation; and (iv) all instruments relating to the admission, withdrawal, removal or substitution of any Partner pursuant to the provisions of this Agreement, or the Capital Contribution of any Partner. The foregoing power of attorney is irrevocable and a power coupled with an interest, in recognition of the fact that each of the Partners will be relying upon the power of the General Partner to act as contemplated by this Agreement in any filing or other action by it on behalf of the Partnership, and it shall survive the death, incapacity or incompetency of a Limited Partner to the effect and extent permitted by law and the Transfer of all or any portion of such Limited Partner's Partnership Units and shall extend to such Limited Partner's heirs, distributees, successors, assigns and personal representatives. IN WITNESS WHEREOF, the undersigned has executed and delivered this Proxy on this 7th day of May, 1999. --------------------------------- Donald E. Axinn, individually

Exhibit 10.17 TENTH AMENDMENT TO AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF BRANDYWINE OPERATING PARTNERSHIP, L.P. THIS TENTH AMENDMENT, dated as of August 31, 1999 (the "Amendment"), amends and supplements the Amended and Restated Agreement of Limited Partnership (as heretofore amended to date, the "Partnership Agreement") of BRANDYWINE OPERATING PARTNERSHIP, L.P., a Delaware limited partnership (the "Partnership"). Capitalized terms used herein but not defined herein shall have the meanings given such terms in the Partnership Agreement. BACKGROUND ---------- E. Pursuant to the Partnership Agreement, Brandywine Realty Trust (the "General Partner"), as the general partner of the Partnership, has the power and authority to issue additional Partnership Interests to persons on such terms and conditions as the General Partner may deem appropriate. F. The General Partner, pursuant to the exercise of such power and authority and in accordance with the Partnership Agreement, has determined to execute this Amendment to the Partnership Agreement to evidence the issuance of additional Partnership Interests to Commonwealth Atlantic Operating Properties, Inc. ("CAOP") as a Limited Partner of the Partnership in exchange for the contribution of real estate and real estate related assets that are being made to the Partnership on the date hereof pursuant to that certain Closing Agreement, dated September 28, 1998, among the Partnership, the General Partner, CAOP and the other signatories thereto. NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby amend the Partnership Agreement as follows: 1. The Partnership Agreement is hereby amended and supplemented to reflect the issuance to CAOP on the date hereof of 400,000 Series B Preferred Units. 2. The Partnership Interests issued hereby shall constitute Series B Preferred Units and shall be subject to all the terms and conditions of the Series B Preferred Units set forth in the Fifth Amendment to the Partnership Agreement, dated September 28, 1998 (the "Fifth Amendment"); provided, that distributions to be received by CAOP on the Series B Preferred Units issued to CAOP hereunder shall be cumulative from the date hereof (rather than from September 28, 1998). The date hereof shall be deemed the "Issue Date" of the Series B Preferred Units issued to CAOP hereunder for any and all purposes, including, without limitation, in applying the terms and conditions of the Fifth Amendment to such Series B Preferred Units.

3. By execution of this Amendment to the Partnership Agreement by the General Partner and CAOP, CAOP agrees to be bound by each and every term of the Partnership Agreement as amended from time to time in accordance with the terms of the Partnership Agreement. 4. On the date of this Amendment, CAOP shall execute and deliver to Brandywine Realty Trust an Irrevocable Proxy coupled with an Interest in the form set forth on Exhibit 1 hereto attached. 5. This Amendment may be executed in one or more counterparts, each such counterpart being deemed to be an original instrument, and all such counterparts together constituting the same agreement. 6. Except as expressly set forth in this Amendment to the Partnership Agreement, the Partnership Agreement is hereby ratified and confirmed in each and every respect. -24-

IN WITNESS WHEREOF, this Amendment to the Partnership Agreement has been executed and delivered as of the date first above written. GENERAL PARTNER: BRANDYWINE REALTY TRUST By:________________________________ Gerard H. Sweeney, President and CEO ADMITTED PARTNER: COMMONWEALTH ATLANTIC OPERATING PROPERTIES, INC. By:________________________________ , Vice President -25-

EXHIBIT 1 IRREVOCABLE PROXY COUPLED WITH AN INTEREST KNOWN ALL MEN BY THESE PRESENTS, that the undersigned hereby irrevocably constitutes and appoints the General Partner, any Liquidating Trustee, and authorized officers and attorneys-in-fact of each, and each of those acting singly, in each case with full power of substitution, as its true and lawful agent and attorney-in-fact, with full power and authority in its name, place and stead to: execute, swear to, acknowledge, deliver, file and record in the appropriate public offices (i) all certificates, documents and other instruments (including, without limitation, this Agreement and the Certificate and all amendments or restatements thereof) that the General Partner or the Liquidating Trustee deems appropriate or necessary to form, qualify or continue the existence or qualification of the Partnership as a limited partnership (or a partnership in which the limited partners have limited liability) in the State of Delaware and in all other jurisdictions in which the Partnership may conduct business or own property; (ii) all instruments that the General Partner deems appropriate or necessary to reflect any amendment, change, modification or restatement of this Agreement in accordance with its terms; (iii) all conveyances and other instruments or documents that the General Partner deems appropriate or necessary to reflect the dissolution and liquidation of the Partnership pursuant to the terms of this Agreement, including, without limitation, a certificate of cancellation; and (iv) all instruments relating to the admission, withdrawal, removal or substitution of any Partner pursuant to the provisions of this Agreement, or the Capital Contribution of any Partner. The foregoing power of attorney is irrevocable and a power coupled with an interest, in recognition of the fact that each of the Partners will be relying upon the power of the General Partner to act as contemplated by this Agreement in any filing or other action by it on behalf of the Partnership, and it shall survive the death, incapacity or incompetency of a Limited Partner to the effect and extent permitted by law and the Transfer of all or any portion of such Limited Partner's Partnership Units and shall extend to such Limited Partner's heirs, distributees, successors, assigns and personal representatives. IN WITNESS WHEREOF, the undersigned has executed and delivered this Proxy on this __th day of August, 1999. COMMONWEALTH ATLANTIC OPERATING PROPERTIES, INC. By:____________________________ Vice President -26-

Exhibit 10.18 ELEVENTH AMENDMENT TO AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF BRANDYWINE OPERATING PARTNERSHIP, L.P. THIS ELEVENTH AMENDMENT, dated December 30, 2003 (this "Amendment"), amends and supplements the Amended and Restated Agreement of Limited Partnership Agreement (as heretofore amended and supplemented to date, the "Partnership Agreement") of BRANDYWINE OPERATING PARTNERSHIP, L.P., a Delaware limited partnership (the "Partnership"). Capitalized terms used herein but not defined herein shall have the meanings given to such terms in the Partnership Agreement. BACKGROUND ---------- G. Pursuant to the Partnership Agreement, Brandywine Realty Trust (the "General Partner"), as the general partner of the Partnership, has the power and authority to issue additional Partnership Interests and Units in one or more newly created classes of Partnership Interests to persons on such terms and conditions as the General Partner may deem appropriate. H. The General Partner, pursuant to the exercise of such power and authority and in accordance with the Partnership Agreement, has determined to execute this Amendment to the Partnership Agreement to create a new class of Partnership Interests designated as the Series D Preferred Mirror Units having designations, preferences and other rights which are substantially the same as the economic rights of the 7.50% Series C Senior Cumulative Redeemable Preferred Shares of Beneficial Interest of the General Partner (the "Series C Preferred Shares") and to evidence the issuance of such additional Partnership Interests to the General Partner in exchange for the General Partner's contribution to the Partnership of the net proceeds of the sale of the Series C Preferred Shares. NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby amend the Partnership Agreement as follows: 1. In accordance with the Partnership Agreement, the Partnership Agreement is hereby amended to establish, and to issue to the General Partner, the Series D Preferred Mirror Units having the designations, preferences and other rights set forth below: (i) Designation and Number. A class of Partnership Interests designated as Series D Preferred Mirror Units is hereby established. The number of Series D Preferred Mirror Units shall be 4,600,000. The stated value of each Series D Preferred Mirror Unit shall be $25.00 (the "Stated Value").

(ii) Rank. The Series D Preferred Mirror Units will, with respect to distribution rights and rights upon liquidation, dissolution or winding up of the Partnership, rank (a) senior to the Class A Units and all Partnership Interests ranking junior to the Series D Preferred Mirror Units; (b) on a parity with the Partnership Interests designated as Series A Preferred Mirror Units and the Partnership Interests designated as Series B Preferred Units and all Partnership Interests issued by the Partnership after the date of this Amendment the terms of which specifically provide that such Partnership Interests rank on a parity with the Series D Preferred Mirror Units; and (c) junior to all Partnership Interests issued by the Partnership the terms of which specifically provide that such Partnership Interests rank senior to the Series D Preferred Mirror Units. (iii) Distributions. (A) Pursuant to Section 6.1 of the Partnership Agreement, holders of Series D Preferred Mirror Units shall be entitled to receive, out of funds legally available therefor, cumulative quarterly cash distributions equal to the amount of the cumulative quarterly cash distributions payable on the Series C Preferred Shares. Such distributions shall be payable quarterly in arrears on or before the date on which distributions on the Series C Preferred Shares are payable (each a "Series D Preferred Mirror Unit Distribution Payment Date"). (B) No distributions on Series D Preferred Mirror Units shall be authorized or paid or set apart for payment by the Partnership at such time as the terms and provisions of any agreement of the Partnership, including any agreement relating to its indebtedness, prohibits such authorization, payment or setting apart for payment or provides that such authorization, payment or setting apart for payment would constitute a breach thereof, or a default thereunder, or if such authorization or payment shall be restricted or prohibited by law. (C) Notwithstanding the foregoing, distributions with respect to the Series D Preferred Mirror Units will accrue whether or not the terms and provisions set forth in Section 1(c)(ii) at any time prohibit the current payment of distributions, whether or not there are funds legally available for such distributions and whether or not such distributions are authorized. Accrued but unpaid distributions on the Series D Preferred Mirror Units will accumulate as of the Series D Preferred Mirror Unit Distribution Payment Date on which they first become payable. -28-

(D) When distributions are not paid in full (or a sum sufficient for such full payment is not so set apart) upon the Series D Preferred Mirror Units and any other Partnership Interests ranking on a parity as to distributions with the Series D Preferred Mirror Units, including the Series A Preferred Mirror Units and the Series B Preferred Units, all distributions authorized upon the Series D Preferred Mirror Units and any other Partnership Interests ranking on a parity as to distributions with the Series D Preferred Mirror Units shall be authorized pro rata so that the amount of distributions authorized per Partnership Unit of Series D Preferred Mirror Units and such other Partnership Interests shall in all cases bear to each other the same ratio that accrued distributions per Partnership Unit on the Series D Preferred Mirror Units and such other Partnership Interests (which shall not, with respect to such other Partnership Interests, include any accrual in respect of unpaid distributions for prior distribution periods if such other Partnership Interests do not have a cumulative distribution) bear to each other. Any distribution payment or payments on Series D Preferred Mirror Units which may be in arrears shall accrue distributions at the rate of 7.50% per annum. (E) Except as provided in Section 1(c)(iv), unless full cumulative distributions on the Series D Preferred Mirror Units have been or contemporaneously are authorized and paid or authorized and a sum sufficient for the payment thereof is set apart for payment for all past distribution periods and the then current distribution period, no distributions (other than in Partnership Interests ranking junior to the Series D Preferred Mirror Units as to distributions and upon liquidation, dissolution or winding up) shall be authorized or paid or set aside for payment nor shall any other distribution be authorized or made upon the Class A Units, the Series A Preferred Mirror Units, the Series B Preferred Units or any other Partnership Interests ranking junior to or on a parity with the Series D Preferred Mirror Units as to distributions or upon liquidation, dissolution or winding up, nor shall any Class A Units, Series A Preferred Mirror Units, Series B Preferred Units or any other Partnership Interests ranking junior to or on a parity with the Series C Preferred Shares as to distributions or upon liquidation be redeemed, purchased or otherwise acquired for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any such units or other Partnership Interests) by the Partnership or any other entity controlled directly or indirectly by the Partnership (except by conversion into or exchange for Partnership Interests ranking junior to the Series D Preferred Mirror Units as to distributions and upon liquidation, dissolution or winding up). -29-

(F) Holders of the Series D Preferred Mirror Units shall not be entitled to any distribution, whether payable in cash, property or Partnership Units in excess of full cumulative distributions on the Series D Preferred Mirror Units as described above. Any distribution payment made on the Series D Preferred Mirror Units shall first be credited against the earliest accrued but unpaid distribution due with respect to such Series D Preferred Mirror Units which remains payable. (iv) Liquidation Preference. (A) Upon any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Partnership, the holders of Series D Preferred Mirror Units then outstanding are entitled to be paid out of the assets of the Partnership available for distribution to the Partners pursuant to Section 13.5(a) of the Partnership Agreement a liquidation preference equal to the Stated Value per Series D Preferred Mirror Unit, plus an amount equal to any accrued and unpaid distributions to the date of payment, before any distribution of assets is made to holders of Class A Units and GP Units or any other Partnership Interests that rank junior to the Series D Preferred Mirror Units upon liquidation, dissolution or winding up. (B) In the event that, upon any such voluntary or involuntary liquidation, dissolution or winding up, the available assets of the Partnership are insufficient to pay the amount of the liquidating distributions on all outstanding Series D Preferred Mirror Units and the corresponding amounts payable on all other Partnership Interests ranking on a parity with the Series D Preferred Mirror Units in the distribution of assets, including the Series A Preferred Mirror Units and the Series B Preferred Units, then such assets shall be allocated among the Series D Preferred Mirror Units, as a class, and each class or series of such other such Partnership Interests, as classes, in proportion to the full liquidating distributions to which they would otherwise be respectively entitled. -30-

(C) After payment of the full amount of the liquidating distributions to which they are entitled, the holders of Series D Preferred Mirror Units will have no right or claim to any of the remaining assets of the Partnership. (D) The consolidation or merger of the Partnership with or into any other partnership, limited liability company, corporation, trust or entity or of any other partnership, limited liability company, corporation, trust or other entity with or into the Partnership, or the sale, lease or conveyance of all or substantially all of the property or business of the Partnership, shall not be deemed to constitute a liquidation, dissolution or winding up of the Partnership for purposes of this Section 1(d). (v) Redemption. In connection with a redemption by the General Partner of any or all of the Series C Preferred Shares, the Partnership shall provide cash to the General Partner for such purpose which shall be equal to the redemption price (including accrued and unpaid distributions) of the Series C Preferred Shares to be redeemed and in exchange one Series D Preferred Mirror Unit shall be canceled with respect to each Series C Preferred Share so redeemed. From and after the date on which the Series C Preferred Shares are redeemed, the Series D Preferred Mirror Units so canceled shall no longer be outstanding and all rights hereunder, to distributions or otherwise, with respect to such Series D Preferred Mirror Units shall cease. (vi) Allocations. Allocations of the Partnership's items of income, gain, loss and deduction shall be allocated among holders of Series D Preferred Mirror Units in accordance with Article VII of the Partnership Agreement. 2. Subparagraph (g) of Section 7.2 of the Partnership Agreement is amended and restated in its entirety as follows: (g) Priority Allocation. All or a portion of the Net Income of the Partnership for the Fiscal Year, if any, shall be specially allocated to the Partners holding Series A Preferred Mirror Units, Series B Preferred Units and Series D Preferred Mirror Units in proportion to the cumulative distributions each has received pursuant to Sections 6.1, 6.2, and 13.5 hereof and, with respect to the Partners holding Series A Preferred Mirror Units, Section 1(c) and 1(d) of the Fourth Amendment to this Agreement or, with respect to Partners holding Series B Preferred Units, Section 1.C and 1.D of the Fifth Amendment to this Agreement, or, with respect to the Partners holding Series D Preferred Mirror Unit, Section 1(c) and 1(d) of the Eleventh Amendment to this Agreement, from the commencement of the Partnership to the end of such Fiscal Year, in an amount equal to the excess, if any, of the sum of (i) the aggregate Net Loss allocated to such Partners pursuant to Section 7.1(b) hereof -31-

for all prior Fiscal Years, if any, and (ii) the aggregate distributions received by such Partners pursuant to Sections 6.1, 6.2, and 13.5 hereof and, with respect to Partners holding Series A Preferred Mirror Units, Section 1(c) and 1(d) of the Fourth Amendment to this Agreement or, with respect to Partners holding Series B Preferred Units, Section 1.C and 1.D of the Fifth Amendment to this Agreement, or, with respect to Partners holding Series D Preferred Mirror Units, Section 1(c) and 1(d) of the Eleventh Amendment to this Agreement from the commencement of the Partnership to the end of such Fiscal Year, over the aggregate items of Net Income allocated to such Partners pursuant to this Section 7.2(g) for all prior Fiscal Years. 3. Except as expressly set forth in this Amendment to the Partnership Agreement, the Partnership Agreement is hereby ratified and confirmed in each and every respect. IN WITNESS WHEREOF, this Eleventh Amendment to the Amended and Restated Agreement of Limited Partnership of Brandywine Operating Partnership, L.P. has been executed and delivered as of the date first above written. GENERAL PARTNER: BRANDYWINE REALTY TRUST By:_______________________________________ Name: Gerard H. Sweeney Its: President and Chief Executive Officer -32-

Exhibit 10.19 TWELFTH AMENDMENT TO AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF BRANDYWINE OPERATING PARTNERSHIP, L.P. THIS TWELFTH AMENDMENT, dated February 27, 2004 (this "Amendment"), amends and supplements the Amended and Restated Agreement of Limited Partnership Agreement (as heretofore amended and supplemented to date, the "Partnership Agreement") of BRANDYWINE OPERATING PARTNERSHIP, L.P., a Delaware limited partnership (the "Partnership"). Capitalized terms used herein but not defined herein shall have the meanings given to such terms in the Partnership Agreement. BACKGROUND ---------- I. Pursuant to the Partnership Agreement, Brandywine Realty Trust (the "General Partner"), as the general partner of the Partnership, has the power and authority to issue additional Partnership Interests and Units in one or more newly created classes of Partnership Interests to persons on such terms and conditions as the General Partner may deem appropriate. J. The General Partner, pursuant to the exercise of such power and authority and in accordance with the Partnership Agreement, has determined to execute this Amendment to the Partnership Agreement to create a new class of Partnership Interests designated as the Series E Preferred Mirror Units having designations, preferences and other rights which are substantially the same as the economic rights of the 7.375% Series D Senior Cumulative Redeemable Preferred Shares of Beneficial Interest of the General Partner (the "Series D Preferred Shares") and to evidence the issuance of such additional Partnership Interests to the General Partner in exchange for the General Partner's contribution to the Partnership of the net proceeds of the sale of the Series D Preferred Shares. NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby amend the Partnership Agreement as follows: 1. In accordance with the Partnership Agreement, the Partnership Agreement is hereby amended to establish, and to issue to the General Partner, the Series E Preferred Mirror Units having the designations, preferences and other rights set forth below: (i) Designation and Number. A class of Partnership Interests designated as Series E Preferred Mirror Units is hereby established. The number of Series E Preferred Mirror Units shall be 2,760,000. The stated value of each Series E Preferred Mirror Unit shall be $25.00 (the "Stated Value").

(ii) Rank. The Series E Preferred Mirror Units will, with respect to distribution rights and rights upon liquidation, dissolution or winding up of the Partnership, rank (a) senior to the Class A Units and all Partnership Interests ranking junior to the Series E Preferred Mirror Units; (b) on a parity with the Partnership Interests designated as Series A Preferred Mirror Units, the Partnership Interests designated as Series B Preferred Units, the Partnership Interests designated as Series D Preferred Mirror Units and all Partnership Interests issued by the Partnership after the date of this Amendment the terms of which specifically provide that such Partnership Interests rank on a parity with the Series E Preferred Mirror Units; and (c) junior to all Partnership Interests issued by the Partnership the terms of which specifically provide that such Partnership Interests rank senior to the Series E Preferred Mirror Units. (iii) Distributions. (A) Pursuant to Section 6.1 of the Partnership Agreement, holders of Series E Preferred Mirror Units shall be entitled to receive, out of funds legally available therefor, cumulative quarterly cash distributions equal to the amount of the cumulative quarterly cash distributions payable on the Series D Preferred Shares. Such distributions shall be payable quarterly in arrears on or before the date on which distributions on the Series D Preferred Shares are payable (each a "Series E Preferred Mirror Unit Distribution Payment Date"). (B) No distributions on Series E Preferred Mirror Units shall be authorized or paid or set apart for payment by the Partnership at such time as the terms and provisions of any agreement of the Partnership, including any agreement relating to its indebtedness, prohibits such authorization, payment or setting apart for payment or provides that such authorization, payment or setting apart for payment would constitute a breach thereof, or a default thereunder, or if such authorization or payment shall be restricted or prohibited by law. (C) Notwithstanding the foregoing, distributions with respect to the Series E Preferred Mirror Units will accrue whether or not the terms and provisions set forth in Section 1(c)(ii) at any time prohibit the current payment of distributions, whether or not there are funds legally available for such distributions and whether or not such distributions are authorized. Accrued but unpaid distributions on the Series E Preferred Mirror Units will accumulate as of the Series E Preferred Mirror Unit Distribution Payment Date on which they first become payable. -34-

(D) When distributions are not paid in full (or a sum sufficient for such full payment is not so set apart) upon the Series E Preferred Mirror Units and any other Partnership Interests ranking on a parity as to distributions with the Series E Preferred Mirror Units, including the Series A Preferred Mirror Units, the Series B Preferred Units, and the Series D Preferred Mirror Units, all distributions authorized upon the Series E Preferred Mirror Units and any other Partnership Interests ranking on a parity as to distributions with the Series E Preferred Mirror Units shall be authorized pro rata so that the amount of distributions authorized per Partnership Unit of Series E Preferred Mirror Units and such other Partnership Interests shall in all cases bear to each other the same ratio that accrued distributions per Partnership Unit on the Series E Preferred Mirror Units and such other Partnership Interests (which shall not, with respect to such other Partnership Interests, include any accrual in respect of unpaid distributions for prior distribution periods if such other Partnership Interests do not have a cumulative distribution) bear to each other. Any distribution payment or payments on Series E Preferred Mirror Units which may be in arrears shall accrue distributions at the rate of 7.375% per annum. (E) Except as provided in Section 1(c)(iv), unless full cumulative distributions on the Series E Preferred Mirror Units have been or contemporaneously are authorized and paid or authorized and a sum sufficient for the payment thereof is set apart for payment for all past distribution periods and the then current distribution period, no distributions (other than in Partnership Interests ranking junior to the Series E Preferred Mirror Units as to distributions and upon liquidation, dissolution or winding up) shall be authorized or paid or set aside for payment nor shall any other distribution be authorized or made upon the Class A Units, the Series A Preferred Mirror Units, the Series B Preferred Units, the Series D Preferred Mirror Units or any other Partnership Interests ranking junior to or on a parity with the Series E Preferred Mirror Units as to distributions or upon liquidation, dissolution or winding up, nor shall any Class A Units, Series A Preferred Mirror Units, Series B Preferred Units, Series D Preferred Mirror Units or any other Partnership Interests ranking junior to or on a parity with the Series E Preferred Mirror -35-

Units as to distributions or upon liquidation be redeemed, purchased or otherwise acquired for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any such units or other Partnership Interests) by the Partnership or any other entity controlled directly or indirectly by the Partnership (except by conversion into or exchange for Partnership Interests ranking junior to the Series E Preferred Mirror Units as to distributions and upon liquidation, dissolution or winding up). (F) Holders of the Series E Preferred Mirror Units shall not be entitled to any distribution, whether payable in cash, property or Partnership Units in excess of full cumulative distributions on the Series E Preferred Mirror Units as described above. Any distribution payment made on the Series E Preferred Mirror Units shall first be credited against the earliest accrued but unpaid distribution due with respect to such Series E Preferred Mirror Units which remains payable. (iv) Liquidation Preference. (A) Upon any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Partnership, the holders of Series E Preferred Mirror Units then outstanding are entitled to be paid out of the assets of the Partnership available for distribution to the Partners pursuant to Section 13.5(a) of the Partnership Agreement a liquidation preference equal to the Stated Value per Series E Preferred Mirror Unit, plus an amount equal to any accrued and unpaid distributions to the date of payment, before any distribution of assets is made to holders of Class A Units and GP Units or any other Partnership Interests that rank junior to the Series E Preferred Mirror Units upon liquidation, dissolution or winding up. (B) In the event that, upon any such voluntary or involuntary liquidation, dissolution or winding up, the available assets of the Partnership are insufficient to pay the amount of the liquidating distributions on all outstanding Series E Preferred Mirror Units and the corresponding amounts payable on all other Partnership Interests ranking on a parity with the Series E Preferred Mirror Units in the distribution of assets, including the Series A Preferred Mirror Units, the Series B Preferred Units and the Series D Preferred Mirror Units, then such assets shall be allocated among the Series E Preferred Mirror Units, as a class, and each class or series of such other such Partnership Interests, as classes, in proportion to the full liquidating distributions to which they would otherwise be respectively entitled. -36-

(C) After payment of the full amount of the liquidating distributions to which they are entitled, the holders of Series E Preferred Mirror Units will have no right or claim to any of the remaining assets of the Partnership. (D) The consolidation or merger of the Partnership with or into any other partnership, limited liability company, corporation, trust or entity or of any other partnership, limited liability company, corporation, trust or other entity with or into the Partnership, or the sale, lease or conveyance of all or substantially all of the property or business of the Partnership, shall not be deemed to constitute a liquidation, dissolution or winding up of the Partnership for purposes of this Section 1(d). (v) Redemption. In connection with a redemption by the General Partner of any or all of the Series D Preferred Shares, the Partnership shall provide cash to the General Partner for such purpose which shall be equal to the redemption price (including accrued and unpaid distributions) of the Series D Preferred Shares to be redeemed and in exchange one Series E Preferred Mirror Unit shall be canceled with respect to each Series D Preferred Share so redeemed. From and after the date on which the Series D Preferred Shares are redeemed, the Series E Preferred Mirror Units so canceled shall no longer be outstanding and all rights hereunder, to distributions or otherwise, with respect to such Series E Preferred Mirror Units shall cease. (vi) Allocations. Allocations of the Partnership's items of income, gain, loss and deduction shall be allocated among holders of Series E Preferred Mirror Units in accordance with Article VII of the Partnership Agreement. 2. Subparagraph (g) of Section 7.2 of the Partnership Agreement is amended and restated in its entirety as follows: (g) Priority Allocation. All or a portion of the Net Income of the Partnership for the Fiscal Year, if any, shall be specially allocated to the Partners holding Series A Preferred Mirror Units, Series B Preferred Units, Series D Preferred Mirror Units and Series E Preferred Mirror Units in proportion to the cumulative distributions each has received pursuant to Sections 6.1, 6.2, and 13.5 hereof and, with respect to the Partners holding Series A Preferred Mirror Units, Section 1(c) and 1(d) of the Fourth Amendment to this Agreement or, with respect to Partners holding Series B Preferred Units, Section 1.C and 1.D of the Fifth Amendment to this Agreement or, with respect to -37-

the Partners holding Series D Preferred Mirror Units, Section 1(c) and 1(d) of the Eleventh Amendment to this Agreement or, with respect to the Partners holding Series E Preferred Mirror Units, Section 1(c) and 1(d) of the Twelfth Amendment to this Agreement, from the commencement of the Partnership to the end of such Fiscal Year, in an amount equal to the excess, if any, of the sum of (i) the aggregate Net Loss allocated to such Partners pursuant to Section 7.1(b) hereof for all prior Fiscal Years, if any, and (ii) the aggregate distributions received by such Partners pursuant to Sections 6.1, 6.2, and 13.5 hereof and, with respect to Partners holding Series A Preferred Mirror Units, Section 1(c) and 1(d) of the Fourth Amendment to this Agreement or, with respect to Partners holding Series B Preferred Units, Section 1.C and 1.D of the Fifth Amendment to this Agreement or, with respect to Partners holding Series D Preferred Mirror Units, Section 1(c) and 1(d) of the Eleventh Amendment to this Agreement or, with respect to Partners holding Series E Preferred Mirror Units, Section 1(c) and 1(d) of the Twelfth Amendment to this Agreement, from the commencement of the Partnership to the end of such Fiscal Year, over the aggregate items of Net Income allocated to such Partners pursuant to this Section 7.2(g) for all prior Fiscal Years. 3. Except as expressly set forth in this Amendment to the Partnership Agreement, the Partnership Agreement is hereby ratified and confirmed in each and every respect. IN WITNESS WHEREOF, this Twelfth Amendment to the Amended and Restated Agreement of Limited Partnership of Brandywine Operating Partnership, L.P. has been executed and delivered as of the date first above written. GENERAL PARTNER: BRANDYWINE REALTY TRUST By:______________________________________________ Name: Gerard H. Sweeney Its: President and Chief Executive Officer -38-


                                                                                       Exhibit 12.1


                                          Brandywine Realty Trust
        Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Share Distributions
                                               (in thousands)


                                                            For the years ended December 31,
                                                -----------------------------------------------------
                                                   2003       2002       2001       2000       1999
                                                   ----       ----       ----       ----       ----
Earnings before fixed charges:
Add:
    Income from continuing operations           $ 74,480   $ 47,842   $ 20,426   $ 38,650   $ 21,759
    Distributions to preferred unitholders         7,069      7,069      7,069      7,069      6,103
    Minority interest of preferred unitholders     7,069      7,069      7,069      7,069      6,103
    Fixed charges - per below                     81,382     88,856     95,533     96,510     84,477
    Cash distributions from income from
      equity investments                           3,310      2,956      5,492          -      1,671
Less:
    Income from equity method investments            (52)      (987)    (2,768)    (2,961)    (1,059)
    Capitalized interest                          (1,503)    (2,949)    (5,178)    (8,182)    (2,100)
    Distributions to preferred unitholders        (7,069)    (7,069)    (7,069)    (7,069)    (6,103)
    Income allocated to preferred
      shareholders                               (11,906)   (11,906)   (11,906)   (11,906)    (4,790)
                                                -----------------------------------------------------

Earnings before fixed charges                   $152,780   $130,881   $108,668   $119,180   $106,061
                                                =====================================================

Fixed charges:
Interest expense (including amortization)       $ 57,835   $ 63,522   $ 67,496   $ 64,746   $ 69,800
Capitalized interest                               1,503      2,949      5,178      8,182      2,100
Proportionate share of interest for
    unconsolidated investments                     3,069      3,410      3,884      4,607      1,684
Distributions to preferred unitholders             7,069      7,069      7,069      7,069      6,103
Income allocated to preferred                     11,906     11,906     11,906     11,906      4,790
                                                -----------------------------------------------------

Fixed charges                                   $ 81,382   $ 88,856   $ 95,533   $ 96,510   $ 84,477
                                                =====================================================

Fixed Charge Coverage Ratio                         1.88       1.47       1.14       1.23       1.26
                                                =====================================================







                             BRANDYWINE REALTY TRUST
                       CODE OF BUSINESS CONDUCT AND ETHICS

Introduction

         This Code of Business Conduct and Ethics covers a wide range of
business practices and procedures. It does not cover every issue that may arise,
but it sets out basic principles to guide employees, officers and trustees of
the Company. All of our employees, officers and trustees must conduct themselves
accordingly and seek to avoid even the appearance of improper behavior.

         If a law conflicts with a policy in this Code, you must comply with the
law; however, if a local custom or policy conflicts with this Code, you must
comply with the Code. If you have any questions about these conflicts, you
should ask your supervisor how to handle the situation.

         Those who violate the standards in this Code will be subject to
disciplinary action which may include immediate termination. If you are in a
situation which you believe may violate or lead to a violation of this Code,
follow the procedures described in Sections 14-16 of this Code.

1. Compliance with Laws

         Obeying the law, both in letter and in spirit, is the foundation on
which this Company's ethical standards are built. All employees, officers and
trustees must obey the laws of the United States and the cities and states in
which we operate. Although not all employees are expected to know the details of
these laws, it is important to know enough to determine when to seek advice from
supervisors.

2. Ethical Conduct

         Beyond compliance with laws, the Company requires that all its
employees, officers, and trustees act in a manner which meets the highest
standards of ethical behavior. The honesty and integrity of our business conduct
must not be compromised. The Company will not condone ethical violations for the
sake of personal gain, personal advantage, expediency, or perceived business
advantage.

3. Accounting and Auditing Matters

         The Company's requirement that employees, officers, and trustees follow
the highest ethical standards applies directly to all actions which involve
business accounting, financial reporting, internal accounting controls, auditing
matters, and public disclosure obligations.

         The Audit Committee of the Company has adopted special procedures for
the receipt, retention, and treatment of complaints regarding accounting,
internal accounting controls, or auditing matters. These procedures are set out
in Sections 15 and 16 of this Code.




4. Conflicts of Interest

         A "conflict of interest" exists when a person's private interest may or
does interfere with the interests of the Company. A conflict can arise when an
employee, officer or trustee takes actions or has interests that may make it
difficult to perform his or her Company work objectively and effectively.
Conflicts of interest may also arise when an employee, officer or trustee, or
member of his or her family, receives improper personal benefits as a result of
his or her position with the Company.

         It is almost always a conflict of interest for a Company employee,
officer or trustee to work simultaneously for a competitor, customer or
supplier. Employees, officers and trustees are not allowed to work for a
competitor as a consultant or board member. The best policy is to avoid any
direct or indirect business connection with our competitors, customers or
suppliers, except on our behalf. Conflicts of interest are prohibited as a
matter of Company policy, except in circumstances approved by the Board of
Trustees or the Audit Committee of the Board.

         Conflicts of interest may not always be clear-cut, so if you have a
question, you should consult with higher levels of management or the Company's
General Counsel. Any employee, officer or trustee who becomes aware of a
conflict or potential conflict should bring it to the attention of a supervisor
or follow the procedures described in Section 13 of this Code.

         Employees, officers and trustees owe a duty to the Company to advance
its legitimate interests when the opportunity to do so arises. In particular:

         o No payments, loans, employment or promises of employment, investment
opportunities, vacation trips, gifts or entertainment (other than entertainment
conforming to generally accepted business practices or gifts of nominal value
not reasonably calculated to influence a decision) may be offered to or accepted
by any employee, officer or trustee or a relative of such a person as a
condition of the initial or continued engagement of a consultant, broker, vendor
or third party working for the Company.

         o No payments (other than fees for services), loans, employment or
promises of employment, investment opportunities, vacation trips, gifts or
entertainment (other than entertainment conforming to generally accepted
business practices or gifts of nominal value not reasonably calculated to
influence a decision) may be offered to or accepted by any consultant, broker,
vendor, government official or a relative of such third party in connection with
any services being performed for the Company.

         o No employee, officer or trustee may recommend any third party for
work for the Company on a project or development of the Company where the third
party's compensation is paid on the basis of any kickback or fee sharing
arrangement with the employee, officer or trustee, nor may an employee, officer
or trustee recommend any third party without full disclosure and written
approval by the President and Chief Executive Officer or Senior Vice President,
if such third party has any familial or pre-existing monetary relationship with
the employee, officer or trustee or if such employee, officer or trustee has an
equity or stock ownership position in such third party.


                                      -2-



         o No employee shall, in his capacity as an employee, make any loan,
donation, contribution or payment to a political party, candidate, or political
action committee, for or on behalf of the Company or any project or development
in which the Company is engaged, nor shall an employee of the Company reimburse
any individual who does. (Nothing contained in this tenet shall prohibit an
employee from taking any of the above actions in his or her name, provided that
the action is exclusively on the employee's own accord and is not an indirect
means of accomplishing one of the prohibited actions).

         o No employee, officer or trustee shall use or appropriate materials,
property, information, equipment, systems and procedures (if proprietary in
nature) owned by the Company for his or her own personal financial gain except
to the extent necessary for the performance of his or her duties for the
Company, nor shall any employee, officer or trustee take for himself or herself
personally opportunities that are discovered through the use of Company
property, information or position.

         In short, the purpose of business entertainment and gifts in a
commercial setting is to create good will and sound working relationships, not
to gain unfair advantage with customers. No gift or entertainment should be
offered, given, provided or accepted by any Company employee, family member of
an employee unless it: (1) is not a cash gift, (2) is consistent with customary
business practices, (3) is not excessive in value, (4) cannot be construed as a
bribe and is not reasonably calculated to influence a decision and (5) does not
violate any laws or regulations. Please discuss with your supervisor any gifts
or proposed gifts which you are not certain are appropriate.

         o No employee shall purchase or obtain any goods or services from any
of the Company's vendors or suppliers without the prior written approval of the
President of the Company.

5. Insider Trading

         Employees, officers and trustees who have access to confidential
information are not permitted to use or share that information for stock trading
purposes or for any other purpose except the conduct of our business and in
strict conformance with all applicable laws and SEC regulations. All non-public
information about the Company should be considered confidential information. To
use non-public information for personal financial benefit or to "tip" others who
might make an investment decision on the basis of this information is not only
unethical but also illegal. The Company's policy on insider trading is set forth
more fully in the "Policy Statement on Dealing with Company Information,
Including Inside Information and Securities Insider Trading" furnished to all
employees, officers and trustees. If you have any questions, please consult the
Company's General Counsel.

6. Competition and Fair Dealing

         We seek to outperform our competition fairly and honestly. We
seek competitive advantages through superior performance, never through
unethical or illegal business practices. Stealing proprietary information,
possessing trade secret information that was obtained without the owner's
consent, or inducing such disclosures by past or present employees of other


                                      -3-



companies is prohibited. Each employee should endeavor to respect the rights of
and deal fairly with the Company's customers, suppliers, competitors and
employees. No employee should take unfair advantage of anyone through
manipulation, concealment, abuse of privileged information, misrepresentation of
material facts, or any other intentional unfair-dealing practice.

7.       Discrimination, Harassment and Retaliation

         The diversity of the Company's employees is a tremendous asset. We are
firmly committed to providing equal opportunity in all aspects of employment and
will not tolerate discrimination, harassment or retaliation. The Company's
policy against discrimination applies to any legally protected status including
race, color, gender, religion, national origin, disability, veteran status, and
age. This policy also prohibits discrimination against any person who provides
information to a federal regulatory or law enforcement agency, a member of
Congress or any committee of Congress, or to a supervisor concerning conduct
which the employee reasonably believes constitutes a violation of securities
laws or any provision of federal law relating to fraud against shareholders. The
Company also prohibits discriminatory harassment of any employee covered by the
policy against discrimination.

         No employee, officer or trustee may retaliate against an individual for
bringing a complaint of discrimination or for participating in an investigation
or proceeding involving a complaint of discrimination.

         No one may take any action harmful to any person for providing to a law
enforcement officer any truthful information relating to the commission or
possible commission of any federal offense.

8. Health and Safety

         The Company strives to provide each employee with a safe and healthful
work environment. Each employee has responsibility for maintaining a safe and
healthy workplace for all employees by following safety and health rules and
practices and reporting accidents, injuries and unsafe conditions.

         Violence and threatening behavior are not permitted. Employees should
report to work in condition to perform their duties, free from the influence of
illegal drugs or alcohol. The use of illegal drugs in the workplace will not be
tolerated.

9. Record-Keeping

         The Company requires honest and accurate recording and reporting of
information in order to make responsible business decisions. For example, only
the true and actual number of hours worked should be reported.

         Many employees regularly use business expense accounts, which must be
documented and recorded accurately. If you are not sure whether a certain
expense is legitimate, ask your supervisor or your controller.



         All of the Company's books, records, accounts and financial statements
must be maintained in reasonable detail, must appropriately reflect the
Company's transactions and must conform both to applicable legal requirements
and to the Company's system of internal controls.

         Business records and communications often become public, and we should
avoid exaggeration, derogatory remarks, guesswork, or inappropriate
characterizations of people and companies that can be misunderstood. This
applies equally to e-mail, internal memos, and formal reports. Records should
always be retained or destroyed according to the Company's record retention
policies. In accordance with those policies, in the event of litigation or
governmental investigation please consult the Company's General Counsel.

10. Confidentiality

         Employees must maintain the confidentiality of the information
entrusted to them by the Company or its customers, except when disclosure is
authorized by the President and Chief Executive Officer, a Senior Vice
President, the Company's General Counsel, or required by law. Confidential
information includes all non-public information that might be of use to
competitors, or harmful to the Company or its customers, if disclosed. It also
includes information that suppliers and customers have entrusted to us. The
obligation to preserve confidential information continues even after employment
ends.

11. Protection and Proper Use of Company Assets

         All employees should endeavor to protect the Company's assets and
ensure their efficient use. Theft, carelessness and waste have a direct impact
on the Company's profitability. Any suspected incident of fraud or theft should
be immediately reported for investigation.

         The obligation of employees to protect the Company's assets includes
the Company's proprietary information. Proprietary information includes
business, marketing and service plans, records, salary information and any
unpublished financial data and reports. Unauthorized use or distribution of this
information would violate Company policy. It could also be illegal and result in
civil or even criminal penalties.

12. Payments to Government Personnel

         The U.S. Foreign Corrupt Practices Act prohibits giving anything of
value, directly or indirectly, to officials of foreign governments or foreign
political candidates in order to obtain or retain business. It is strictly
prohibited to make illegal payments to government officials of any country. In
addition, the U.S. government has a number of laws and regulations regarding
business gratuities which may be accepted by U.S. government personnel. The
promise, offer or delivery to an official or employee of the U.S. government of
a gift, favor or other gratuity in violation of these rules would not only
violate Company policy but could also be a criminal offense. State and local
governments, as well as foreign governments, may have similar rules. The
Company's General Counsel can provide guidance to you in this area.


                                      -5-




13. Waivers of the Code of Business Conduct and Ethics

         Any waiver of this Code for executive officers or trustees may be made
only by the Board or the Audit Committee and will be promptly disclosed as
required by law or stock exchange regulation.

14. Personal Responsibility

         We must all work to ensure prompt and consistent action against
violations of this Code. However, in some situations it is difficult to know
right from wrong. Since we cannot anticipate every situation that will arise, it
is important that we have a way to approach a new question or problem. These are
the steps to keep in mind:

     o   Make sure you have all the facts. In order to reach the right
         solutions, we must be as fully informed as possible.

     o   Ask yourself: What specifically am I being asked to do? Does it seem
         unethical or improper? This will enable you to focus on the specific
         question you are faced with, and the alternatives you have. Use your
         judgment and common sense; if something seems unethical or improper, it
         probably is.

     o   Clarify your responsibility and role. In most situations, there is
         shared responsibility. Are your colleagues informed? It may help to get
         others involved and discuss the problem.

     o   Discuss the problem with your supervisor. This is the basic guidance
         for all situations. In many cases, your supervisor will be more
         knowledgeable about the question, and will appreciate being brought
         into the decision-making process. Remember that it is your supervisor's
         responsibility to help solve problems.

     o   Seek help from Company resources. In the rare case where it may not be
         appropriate to discuss an issue with your supervisor, or where you do
         not feel comfortable approaching your supervisor with your question,
         discuss it locally with your office manager or with the Director of
         Human Resources. If that also is not appropriate, call our General
         Counsel.

     o   You may report ethical violations in confidence and without fear of
         retaliation. If your situation requires that your identity be kept
         secret, your anonymity will be protected. The Company does not permit
         retaliation of any kind against employees for good faith reports of
         ethical violations.

     o   Always ask first, act later: If you are unsure of what to do in any
         situation, seek guidance before you act.


                                      -6-


15. Reporting/Investigation Procedures

         Any employee who reasonably believes that there has been a material
violation of this Code of Conduct should report it immediately to the Company's
General Counsel. The General Counsel (or his/her designee) will promptly
investigate the matter. The investigation will be handled discreetly and
appropriately, and the information will be disclosed to others only on a need to
know basis and as required by law. There will be no adverse action taken against
employees who report violations of the Code of Conduct or who participate in the
investigation. If the investigation leads to a conclusion that a material
violation of the Code of Conduct has occurred, the Company will take appropriate
corrective action which may include removal from a position as trustee or
officer, and dismissal as an employee of the Company.

         The Company recognizes the potentially serious impact of a false
accusation. Employees are expected as part of the ethical standards required by
this Code of Conduct to act responsibly in making complaints. Making a complaint
without a good faith basis is itself an ethical violation. Any employee who
makes a complaint in bad faith will be subject to appropriate corrective action
including dismissal.

16. Special Procedures for Reporting/Investigating Complaints Regarding
Accounting, Internal Accounting Controls, and Auditing Matters

         Any employee who reasonably believes that there has been a material
violation of this Code of Conduct caused by questionable accounting or auditing
matters has the right to submit a confidential, anonymous complaint to the
Company General Counsel. The complaint should be made in written form and
provide sufficient information so that a reasonable investigation can be
conducted. The complaint should be addressed to the General Counsel of
Brandywine Realty Trust.




                                      -7-



Exhibit 21.1
- ------------

                              List of Subsidiaries
                              --------------------

AAPOP 1, L.P., a Delaware limited partnership

AAPOP 2, L.P., a Delaware limited partnership

Brandywine Ambassador, L.P., a Pennsylvania limited partnership

Brandywine Central, L.P., a Pennsylvania limited partnership

Brandywine Cira, L.P., a Pennsylvania limited partnership

Brandywine Croton, L.P., a Pennsylvania limited partnership

Brandywine Dominion, L.P., a Pennsylvania limited partnership

Brandywine F.C., L.P., a Pennsylvania limited partnership

Brandywine Grande B, L.P., a Delaware limited partnership

Brandywine Grande C, L.P., a Delaware limited partnership

Brandywine Industrial Partnership, L.P., a Delaware limited partnership

Brandywine I.S., L.P., a Pennsylvania limited partnership

Brandywine Metroplex, L.P., a Pennsylvania limited partnership

Brandywine Norriton, L.P., a Pennsylvania limited partnership

Brandywine Operating Partnership, L.P., a Delaware limited partnership

Brandywine P.M., L.P., a Pennsylvania limited partnership

Brandywine TB Florig, L.P., a Pennsylvania limited partnership

Brandywine TB Inn, L.P., a Pennsylvania limited partnership

Brandywine TB I, L.P., a Pennsylvania limited partnership

Brandywine TB II, L.P., a Pennsylvania limited partnership

Brandywine TB V, L.P., a Pennsylvania limited partnership

Brandywine TB VI, L.P., a Pennsylvania limited partnership

Brandywine TB VIII, L.P., a Pennsylvania limited partnership




C/N Iron Run Limited Partnership III, a Pennsylvania limited partnership

C/N Leedom Limited Partnership II, a Pennsylvania limited partnership

C/N Oaklands Limited Partnership I, a Pennsylvania limited partnership

C/N Oaklands Limited Partnership III, a Pennsylvania limited partnership

Eight/Oliver Brandywine Partner, L.P., a Pennsylvania limited partnership

Eight Tower Bridge Development Associates, a Pennsylvania limited partnership

e-Tenants.com Holding, L.P., a Pennsylvania limited partnership

Fifteen Horsham, L.P., a Pennsylvania limited partnership

Five/Oliver Brandywine Partner, L.P., a Pennsylvania limited partnership

Five Tower Bridge Associates, a Pennsylvania limited partnership

Four Tower Bridge Associates, a Pennsylvania limited partnership

Iron Run Limited Partnership V, a Pennsylvania limited partnership

LC/N Horsham Limited Partnership, a Pennsylvania limited partnership

LC/N Keith Valley Limited Partnership I, a Pennsylvania limited partnership

Newtech IV Limited Partnership, a Pennsylvania limited partnership

Nichols Lansdale Limited Partnership III, a Pennsylvania limited partnership

Six Tower Bridge Associates, a Pennsylvania limited partnership

Tower Bridge Inn Associates, a Pennsylvania limited partnership

Two Tower Bridge Associates, a Pennsylvania limited partnership

Witmer Operating Partnership I, L.P., a Delaware limited partnership

100 Arrandale Associates, L.P., a Pennsylvania limited partnership

111 Arrandale Associates, L.P., a Pennsylvania limited partnership

440 Creamery Way Associates, L.P., a Pennsylvania limited partnership

442 Creamery Way Associates, L.P., a Pennsylvania limited partnership

481 John Young Way Associates, L.P., a Pennsylvania limited partnership




Brandywine 55 Ames Court Partnership, a New York general partnership

Brandywine Broad Street Partnership, a New York general partnership

Interstate Center Associates, a Virginia general partnership

Iron Run Venture II, a Pennsylvania general partnership

IR Northlight II Associates, a Pennsylvania general partnership

Plymouth TFC, General Partnership, a Pennsylvania general partnership

AAP Sub One, Inc., a Delaware corporation

Atlantic American Land Development, Inc., a Delaware corporation

Brandywine Grande C Corp., a Delaware corporation

Brandywine Holdings, I, Inc., a Pennsylvania corporation

Brandywine Norriton Corp., a Pennsylvania corporation

Brandywine Realty Services Corporation, a Pennsylvania corporation

BTRS, Inc., a Delaware corporation

Southpoint Land Holdings, Inc., a Pennsylvania corporation

Valleybrooke Land Holdings, Inc., a Pennsylvania corporation

Brandywine Ambassador, L.L.C., a Pennsylvania limited liability company

Brandywine Axinn I, LLC, a Delaware limited liability company

Brandywine Axinn II, LLC, a Delaware limited liability company

Brandywine Brokerage Services, LLC, A New Jersey limited liability company

Brandywine Cira, LLC, a Pennsylvania limited liability company

Brandywine Charlottesville LLC, a Virginia limited liability company

Brandywine Christina LLC, a Delaware limited liability company

Brandywine Croton, LLC, a Pennsylvania limited liability company

Brandywine Dabney, L.L.C., a Delaware limited liability company

Brandywine Dominion, L.L.C., a Pennsylvania limited liability company



Brandywine F.C., L.L.C., a Pennsylvania limited liability company

Brandywine I.S., L.L.C., a Pennsylvania limited liability company

Brandywine Interstate 50,  L.L.C., a Delaware limited liability company

Brandywine - Main Street, LLC, a Delaware limited liability company

Brandywine Metroplex LLC., a Pennsylvania limited liability company

Brandywine Norriton, L.L.C., a Pennsylvania limited liability company

Brandywine P.M., L.L.C., a Pennsylvania limited liability company

Brandywine Piazza, L.L.C., a New Jersey limited liability company

Brandywine Plaza 1000, L.L.C., a New Jersey limited liability company

Brandywine Promenade, L.L.C., a New Jersey limited liability company

Brandywine TB Florig, LLC, a Pennsylvania limited liability company

Brandywine TB Inn, L.L.C., a Pennsylvania limited liability company

Brandywine TB I, L.L.C., a Pennsylvania limited liability company

Brandywine TB II, L.L.C., a Pennsylvania limited liability company

Brandywine TB V, L.L.C., a Pennsylvania limited liability company

Brandywine TB VI, L.L.C., a Pennsylvania limited liability company

Brandywine TB VIII, L.L.C., a Pennsylvania limited liability company

Brandywine Trenton Urban Renewal, L.L.C., a Delaware limited liability company

Brandywine Witmer, L.L.C., a Pennsylvania limited liability company

Christiana Center Operating Company I LLC, a Delaware limited liability company

Christiana Center Operating Company II LLC, a Delaware limited liability company

Christiana Center Operating Company III LLC,
   a Delaware limited liability company

e-Tenants LLC, a Delaware limited liability company

Macquarie BDN, LLC, a Delaware limited liability company

Macquarie BDN Christina I, LLC, a Delaware limited liability company

Macquarie BDN Christina III, LLC, a Delaware limited liability company

PJP Building Two, L.C., a Virginia limited liability company

PJP Building  Five, L.C., a Virginia limited liability company

1000 Chesterbrook Boulevard Partnership, a Pennsylvania general partnership

Atlantic American Properties Trust, a Maryland real estate investment trust



                                                                    Exhibit 23.1



                          INDEPENDENT AUDITORS' CONSENT
                          -----------------------------

The Board of Trustees
Brandywine Realty Trust:



We consent to the incorporation by reference in the registration statements
(Nos. 333-109010, 33-52952, 333-69653, 333-56237, 333-53359, 333-46647,
333-20999) on Form S-3 and (Nos. 333-52957, 333-28427, 333-14243) on Form S-8 of
Brandywine Realty Trust of our report dated February 26, 2003, except as to
notes 9, 12 and 13, which are as of December 31, 2003, with respect to the
consolidated balance sheet of Brandywine Realty Trust and subsidiaries as of
December 31, 2002, and the related consolidated statements of operations,
beneficiaries' equity and comprehensive income, and cash flows for each of the
years in the two-year period ended December 31, 2002, which report is included
in the Annual Report on Form 10-K of Brandywine Realty Trust for 2003. Our
report refers to the fact that effective January 1, 2002, the Company adopted
Statement of Financial Accounting Standards No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets." Also, our report refers to the
fact that effective January 1, 2003, the Company adopted Statement of Financial
Accounting Standards No. 145, "Rescission of No. 4, 44, and 64, Amendment of
FASB No. 13, and Technical Corrections."



/s/  KPMG LLP

Philadelphia, Pennsylvania
March 12, 2004





                                                                    Exhibit 23.2

                       CONSENT OF INDEPENDENT ACCOUNTANTS
                       ----------------------------------


We hereby consent to the incorporation by reference in the Registration
Statement on Form S-3 (Nos. 333-52952, 333-69653, 333-56237, 333-53359,
333-46647, 333-20999, 333-109010) and Form S-8 (Nos. 333-52957, 333-28427,
333-14243) of Brandywine Realty Trust and its subsidiaries of our report dated
February 20, 2004 relating to the consolidated financial statements and
consolidated financial statement schedules, which appear in this Form 10-K.



/s/ PricewaterhouseCoopers LLP
Philadelphia, Pennsylvania
March 12, 2004







                                                                    Exhibit 31.1
                            SECTION 302 CERTIFICATION

         I, Gerard H. Sweeney, certify that:

         1.   I have reviewed this annual report on Form 10-K of Brandywine
              Realty 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 in 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
              15(d)-15(e)) 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 other within those entities,
                   particularly during the period in which this report is being
                   prepared;

              b.   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

              c.   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; and

         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:
                   -----------------      -------------------------------------
                                          Gerard H. Sweeney
                                          President and Chief Executive Officer





                                                                    Exhibit 31.2

                            SECTION 302 CERTIFICATION

         I, Christopher P. Marr, certify that:

         1.   I have reviewed this annual report on Form 10-K of Brandywine
              Realty 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 in 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
              15(d)-15(e)) 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 other within those entities,
                   particularly during the period in which this report is being
                   prepared;

              b.   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

              c.   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; and

         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:
                   --------------------     -----------------------------------
                                            Christopher P. Marr
                                            Vice President and Chief Financial
                                            Officer





                                                                    Exhibit 32.1



                         RULE 13(a)-14(b) CERTIFICATION
                                   PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002*

      In connection with the Annual Report of Brandywine Realty Trust (the
"Company") on Form 10-K for the fiscal year ended December 31, 2003 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Gerard H. Sweeney, President and Chief Executive Officer of the Company,
certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002, that:

  1.     The Report fully complies with the requirements of Section 13(a) or
         15(d), as applicable, 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/ Gerard H. Sweeney
- ---------------------
Gerard H. Sweeney
President and Chief Executive Officer
Date: March 12, 2004



* A signed original of this written statement required by Section 906 has been
provided to Brandywine Realty Trust and will be retained by Brandywine Realty
Trust and furnished to the Securities and Exchange Commission or its staff upon
request.






                                                                    Exhibit 32.2



                         RULE 13(a)-14(b) CERTIFICATION
                                   PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002*

      In connection with the Annual Report of Brandywine Realty Trust (the
"Company") on Form 10-K for the fiscal year ended December 31, 2003 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Christopher P. Marr, Senior Vice President and Chief Financial Officer of the
Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that:

  1.     The Report fully complies with the requirements of Section 13(a) or
         15(d), as applicable, 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/ Christopher P. Marr
- -----------------------
Christopher P. Marr
Senior Vice President and Chief Financial Officer
Date: March 12, 2004



* A signed original of this written statement required by Section 906 has been
provided to Brandywine Realty Trust and will be retained by Brandywine Realty
Trust and furnished to the Securities and Exchange Commission or its staff upon
request.

	Annual report pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934
	For the fiscal year ended December 31, 2003 or

	Transition report pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934
	For the transition period from to

Commission File Number 1-9106


Maryland	23-2413352
(State or other jurisdiction of Incorporation or organization)	(I.R.S. Employer Identification No.)

401 Plymouth Road, Plymouth Meeting, Pennsylvania	19462
(Address of principal executive offices)	(Zip Code)

(610) 325-5600
Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Shares of Beneficial Interest, (par value $0.01 per share) 7.50% Series C Cumulative Redeemable Preferred Shares of Beneficial Interest (par value $0.01 per share) 7.375% Series D Cumulative Redeemable Preferred Shares of Beneficial Interest (par value $0.01 per share)	New York Stock Exchange New York Stock Exchange New York Stock Exchange

		Page
Item 1.	Business	5

Item 2.	Properties	18

Item 3.	Legal Proceedings	28

Item 4.	Submission of Matters to a Vote of Security Holders	29

Item 5.	Market for Registrant’s Common Equity and Related Shareholder Matters and Issuer Purchases of Equity Securities	29

Item 6.	Selected Financial Data	31

Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31

Item 7A.	Quantitative and Qualitative Disclosure About Market Risk	44

Item 8.	Financial Statements and Supplementary Data	44

Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	44

Item 9A.	Controls and Procedures	45

Item 10.	Trustees and Executive Officers of the Registrant	46

Item 11.	Executive Compensation	46

Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters	46

Item 13.	Certain Relationships and Related Transactions	46

Item 14.	Principal Accountant Fees and Services	46

Item 15.	Exhibits, Financial Statements, Schedules and Reports on Form 8-K	47

SIGNATURES		52