Maryland

36-3953261

(State or other jurisdiction

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

of incorporation or organization)

2901 Butterfield Road, Oak Brook, Illinois

60523

(Address of principal executive offices)

(Zip code)

Part I – Financial Information

Page

Item 1.

Financial Statements

Consolidated Balance Sheets at June 30, 2004 (unaudited) and December 31,
    2003 (audited)

3

Consolidated Statements of Operations for the three and six months ended
    June 30, 2004 and 2003 (unaudited)

5

Consolidated Statement of Stockholders' Equity for the six months ended
    June 30, 2004 (unaudited)

7

Consolidated Statements of Cash Flows for the six months ended June 30, 2004
    and 2003 (unaudited)

8

Notes to Consolidated Financial Statements (unaudited)

11

Item 2.

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

26

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

43

Item 4.

Controls and Procedures

44

Part II – Other Information

Item 1.

Legal Proceedings

45

Item 2.

Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities

45

Item 3.

Defaults upon Senior Securities

45

Item 4.

Submission of Matters to a Vote of Security Holders

45

Item 5.

Other Information

45

Item 6.

Exhibits and Reports on Form 8-K

          (a) Exhibits

46

          (b) Reports on Form 8-K

47

Signatures

48

June 30, 2004
(unaudited)

December 31, 2003
(audited)

Investment properties:

  Land

$

348,852,580

346,088,070

  Construction in progress

1,663,008

-

  Building and improvements

929,943,782

920,542,755

1,280,459,370

1,266,630,825

  Less accumulated depreciation

160,683,135

147,341,377

Net investment properties

1,119,776,235

1,119,289,448

Cash and cash equivalents

42,842,921

58,388,077

Investment in securities (net of an unrealized gain of $117,203 and
  $1,501,765 at June 30, 2004 and December 31, 2003, respectively)

8,275,494

12,040,689

Assets held for sale (net of accumulated depreciation of $6,831,034
  and $2,835,477 at June 30, 2004 and December 31, 2003,
  respectively)

36,034,145

14,443,761

Restricted cash

7,356,824

13,329,091

Accounts and rents receivable (net of provision for doubtful accounts
  of $2,606,469 and $2,966,275 at June 30, 2004 and December 31,
  2003, respectively)

35,905,464

30,020,794

Investment in and advances to joint venture

-

8,392,406

Deposits and other assets

2,035,137

1,941,614

Acquired above market lease intangibles (net of accumulated
  amortization of $1,333,701 and $933,811 at June 30, 2004 and
  December 31, 2003, respectively)

5,390,186

5,772,521

Acquired in-place lease intangibles (net of accumulated amortization
  of $1,409,786 and $740,796 at June 30, 2004 and December 31,
  2003, respectively)

13,211,819

10,414,375

Leasing fees (net of accumulated amortization of $1,629,420 and
  $1,368,464 at June 30, 2004 and December 31, 2003, respectively)

2,122,135

1,990,576

Loan fees (net of accumulated amortization of $6,265,812 and
  $5,096,350 at June 30, 2004 and December 31, 2003, respectively)

4,565,399

4,632,258

Total assets

$

1,277,515,759

1,280,655,610

June 30, 2004
(unaudited)

December 31, 2003
(audited)

Liabilities:

  Accounts payable and accrued expenses

$

3,895,128

1,994,427

  Acquired below market lease intangibles (net of accumulated
    amortization of $2,154,338 and $1,459,136 at June 30, 2004 and
    December 31, 2003, respectively)

7,580,714

8,154,827

  Accrued interest

2,011,202

1,809,480

  Accrued real estate taxes

25,921,546

25,492,747

  Distributions payable

5,264,726

5,406,012

  Security and other deposits

2,481,359

2,485,207

  Mortgages payable

622,820,276

615,511,713

  Line of credit

110,000,000

135,000,000

  Prepaid rents and unearned income

3,217,301

3,151,431

  Liabilities associated with assets held for sale, including mortgages
    payable

20,819,460

7,741,868

  Other liabilities

2,045,881

2,440,372

Total liabilities

806,057,593

809,188,084

Minority interest

20,452,541

20,973,496

Redeemable common stock relating to Put Agreement (3,932,584
  Shares)

35,000,000

35,000,000

Stockholders' Equity:

  Preferred stock, $.01 par value, 6,000,000 Shares authorized; none
    issued and outstanding at June 30, 2004 and December 31, 2003

-

-

  Common stock, $.01 par value, 100,000,000 Shares authorized;
    62,615,276 and 61,660,061 Shares issued and outstanding at
    June 30, 2004 and December 31, 2003, respectively

626,153

616,600

  Additional paid-in capital (net of offering costs of $58,816,092 and
    redeemable common stock relating to Put Agreement of
    $35,000,000)

                 602,384,985

592,169,119

  Deferred stock compensation

(640,413)

(48,000)

  Accumulated distributions in excess of net income

(186,482,303)

(178,745,454)

  Accumulated other comprehensive income

117,203

1,501,765

Total stockholders' equity

416,005,625

415,494,030

Commitments and contingencies

Total liabilities and stockholders' equity

$

1,277,515,759

1,280,655,610

Three months
ended
June 30, 2004

Three months
ended
June 30, 2003

Six months
ended
June 30, 2004

Six months
ended
June 30, 2003

Income:

  Rental income

$

32,813,977

30,669,355

65,994,989

60,546,695

  Additional rental income

11,870,601

11,507,492

26,224,574

23,783,167

  Lease termination income

618,366

-

618,366

369,819

  Interest income

212,692

130,674

365,318

257,572

  Dividend income

224,420

277,139

482,269

550,687

  Other income

769,746

139,068

1,186,934

252,945

46,509,802

42,723,728

94,872,450

85,760,885

Expenses:

  Professional services

230,983

173,089

446,579

254,531

  General and administrative expenses

2,002,934

1,441,401

3,464,436

2,533,258

  Stock exchange listing expenses

739,527

-

739,527

-

  Bad debt expense

(743,084)

548,080

309,691

1,233,938

  Property operating expenses

13,552,421

12,597,984

28,603,419

26,551,167

  Interest expense

10,712,805

9,625,169

21,312,309

19,171,077

  Depreciation

8,912,897

8,034,921

17,705,501

15,926,209

  Amortization

579,394

253,243

1,097,681

473,549

  Acquisition cost expenses

10,282

6,849

45,843

23,232

35,998,159

32,680,736

73,724,986

66,166,961

Income from operations

10,511,643

10,042,992

21,147,464

19,593,924

Minority interest

(218,117)

(177,539)

(434,475)

(357,843)

Loss from operations of unconsolidated ventures

-

(187,821)

-

(160,833)

Income before discontinued operations

10,293,526

9,677,632

20,712,989

19,075,248

Discontinued operations

  Income from discontinued operations (including gain on sale
    of investment properties of $165,518 and $2,529 for the
    three months ended June 30, 2004 and 2003, respectively,
    and $1,038,591 and $2,529 for the six months ended June
    30, 2004 and 2003, respectively)

981,895

406,562

2,447,943

1,010,774

Net income

11,275,421

10,084,194

23,160,932

20,086,022

Other comprehensive income:

  Unrealized gain (loss) on investment securities

(1,421,412)

837,219

(1,384,562)

392,770

Comprehensive income

$

9,854,009

10,921,413

21,776,370

20,478,792

Three months
ended
June 30, 2004

Three months
ended
June 30, 2003

Six months
ended
June 30, 2004

Six months
ended
June 30, 2003

Income before discontinued operations per common share,
  basic and diluted

$

0.16

0.15

0.31

0.29

Income from discontinued operations per common share, basic
  and diluted

$

0.01

0.01

0.04

0.02

Net income per common share, basic and diluted

$

0.17

0.16

0.35

0.31

Weighted average common shares outstanding, basic

66,281,126

64,905,475

66,042,288

64,782,608

Weighted average common shares outstanding, diluted

66,331,144

64,909,839

66,092,306