UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


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

For the quarterly period ended ~~September 30, 2021.~~March 31, 2022.


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

For the transition period from _________________ to ________________

Commission File Number 1-12386

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST

(Exact name of registrant as specified in its charter)


Maryland			13-3717318
(State or other jurisdiction of incorporation of organization)			(I.R.S. Employer Identification No.)

One Penn Plaza, Suite 4015, New York, NY 10119-4015

(Address of principal executive offices) (zip code)

(212) 692-7200

(Registrant's telephone number, including area code)

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


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Shares of beneficial interest, par value $0.0001 per share, classified as Common Stock	LXP	New York Stock Exchange
6.50% Series C Cumulative Convertible Preferred Stock, par value $0.0001 per share	LXPPRC	New York Stock Exchange

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 whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒☒ No ☐☐

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

Large accelerated filer

☒☒

Accelerated filer

☐☐

Non-accelerated filer

☐☐

Smaller reporting company

☐☐

Emerging growth

company

☐☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐☐ No ☒☒

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date: ~~282,817,432~~286,649,181 common shares of beneficial interest, par value $0.0001 per share, as of ~~November 2, 2021.~~May 3, 2022.

TABLE OF CONTENTS


PART I. —— FINANCIAL INFORMATION
ITEM 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets						3
Condensed Consolidated Statements of Operations						4
Condensed Consolidated Statements of Comprehensive Income (Loss)						5
Condensed Consolidated Statements of Changes in Equity						6
Condensed Consolidated Statements of Cash Flows						7
Notes to Condensed Consolidated Financial Statements						8
ITEM 2. ~~Management’s~~Management’s Discussion and Analysis of Financial Condition and Results of Operations						2625
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk						3734
ITEM 4. Controls and Procedures						3734
PART II —— OTHER INFORMATION
ITEM 1. Legal Proceedings						3835
ITEM 1A. Risk Factors						3835
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds						3835
ITEM 3. Defaults Upon Senior Securities						3835
ITEM 4. Mine Safety Disclosures						3835
ITEM 5. Other Information						3835
ITEM 6. Exhibits						3936
SIGNATURES						4138

WHERE YOU CAN FIND MORE INFORMATION:

We file and furnish annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission, which we refer to as the SEC. You may read and copy any materials that we file or furnish with the SEC at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. We file and furnish information electronically with the SEC. The SEC maintains an Internet site that contains reports, proxy and information statements and other information regarding issuers that file or furnish electronically with the SEC. The address of the SEC's Internet site is http://www.sec.gov. We also maintain a web site at http://www.lxp.com through which you can obtain copies of documents that we file or furnish with the SEC. The contents of that web site are not incorporated by reference in or otherwise a part of this Quarterly Report on Form 10-Q or any other document that we file or furnish with the SEC.

Table of Contents

PART I. - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited and in thousands, except share and per share data)


		September 30, 2021		December 31, 2020			March 31, 2022		December 31, 2021

Assets:	Assets:					Assets:
Real estate, at cost	Real estate, at cost	$	3,721,870	$	3,514,564	Real estate, at cost	$	3,629,494	$	3,583,978
Real estate - intangible assets	Real estate - intangible assets	402,365		409,293		Real estate - intangible assets	339,216		341,403
Land held for development						Land held for development	104,347		104,160
Investments in real estate under construction	Investments in real estate under construction	185,704		75,906		Investments in real estate under construction	231,258		161,165
Real estate, gross	Real estate, gross	4,309,939		3,999,763		Real estate, gross	4,304,315		4,190,706
Less: accumulated depreciation and amortization	Less: accumulated depreciation and amortization	911,410		884,465		Less: accumulated depreciation and amortization	683,013		655,740
Real estate, net	Real estate, net	3,398,529		3,115,298		Real estate, net	3,621,302		3,534,966
Assets held for sale	Assets held for sale	30,145		16,530		Assets held for sale	106,653		82,586
Right-of-use assets, net	Right-of-use assets, net	29,067		31,423		Right-of-use assets, net	26,985		27,966

Cash and cash equivalents	Cash and cash equivalents	150,077		178,795		Cash and cash equivalents	49,063		190,926
Restricted cash	Restricted cash	373		626		Restricted cash	105		101
Investments in non-consolidated entities	Investments in non-consolidated entities	51,021		56,464		Investments in non-consolidated entities	73,575		74,559
Deferred expenses, net	Deferred expenses, net	13,289		15,901		Deferred expenses, net	21,839		18,861

Rent receivable – current		1,998		2,899
Rent receivable – deferred		71,317		66,959
Rent receivable – current						Rent receivable – current	3,993		3,526
Rent receivable – deferred						Rent receivable – deferred	66,807		63,283
Other assets	Other assets	12,661		8,331		Other assets	17,224		8,784
Total assets	Total assets	$	3,758,477	$	3,493,226	Total assets	$	3,987,546	$	4,005,558

Liabilities and Equity:	Liabilities and Equity:					Liabilities and Equity:
Liabilities:	Liabilities:					Liabilities:
Mortgages and notes payable, net	Mortgages and notes payable, net	$	115,633	$	136,529	Mortgages and notes payable, net	$	80,385	$	83,092

Term loan payable, net	Term loan payable, net	298,320		297,943		Term loan payable, net	298,572		298,446
Senior notes payable, net	Senior notes payable, net	987,590		779,275		Senior notes payable, net	988,272		987,931

Trust preferred securities, net	Trust preferred securities, net	127,570		127,495		Trust preferred securities, net	127,620		127,595
Dividends payable	Dividends payable	34,283		35,401		Dividends payable	36,784		37,425
Liabilities held for sale	Liabilities held for sale	1,122		790		Liabilities held for sale	3,879		3,468
Operating lease liabilities	Operating lease liabilities	30,109		32,515		Operating lease liabilities	28,036		29,094
Accounts payable and other liabilities	Accounts payable and other liabilities	59,681		55,208		Accounts payable and other liabilities	65,534		77,607
Accrued interest payable	Accrued interest payable	5,638		6,334		Accrued interest payable	10,249		8,481
Deferred revenue - including below-market leases, net	Deferred revenue - including below-market leases, net	15,490		17,264		Deferred revenue - including below-market leases, net	13,982		14,474
Prepaid rent	Prepaid rent	14,679		13,335		Prepaid rent	13,751		14,717
Total liabilities	Total liabilities	1,690,115		1,502,089		Total liabilities	1,667,064		1,682,330

Commitments and contingencies	Commitments and contingencies	0		0		Commitments and contingencies	0		0
Equity:	Equity:					Equity:
Preferred shares, par value $0.0001 per share; authorized 100,000,000 shares:	Preferred shares, par value $0.0001 per share; authorized 100,000,000 shares:					Preferred shares, par value $0.0001 per share; authorized 100,000,000 shares:
Series C Cumulative Convertible Preferred, liquidation preference $96,770; 1,935,400 shares issued and outstanding	Series C Cumulative Convertible Preferred, liquidation preference $96,770; 1,935,400 shares issued and outstanding	94,016		94,016		Series C Cumulative Convertible Preferred, liquidation preference $96,770; 1,935,400 shares issued and outstanding	94,016		94,016
Common shares, par value $0.0001 per share; authorized 400,000,000 shares, 282,638,707 and 277,152,450 shares issued and outstanding in 2021 and 2020, respectively		28		28
Common shares, par value $0.0001 per share; authorized 400,000,000 shares, 287,871,649 and 283,752,726 shares issued and outstanding in 2022 and 2021, respectively						Common shares, par value $0.0001 per share; authorized 400,000,000 shares, 287,871,649 and 283,752,726 shares issued and outstanding in 2022 and 2021, respectively	29		28
Additional paid-in-capital	Additional paid-in-capital	3,239,850		3,196,315		Additional paid-in-capital	3,261,770		3,252,506
Accumulated distributions in excess of net income	Accumulated distributions in excess of net income	(1,276,134)		(1,301,726)		Accumulated distributions in excess of net income	(1,074,998)		(1,049,434)
Accumulated other comprehensive loss		(10,891)		(17,963)
Total shareholders’ equity		2,046,869		1,970,670
Accumulated other comprehensive income (loss)						Accumulated other comprehensive income (loss)	6,008		(6,258)
Total shareholders’ equity						Total shareholders’ equity	2,286,825		2,290,858
Noncontrolling interests	Noncontrolling interests	21,493		20,467		Noncontrolling interests	33,657		32,370
Total equity	Total equity	2,068,362		1,991,137		Total equity	2,320,482		2,323,228
Total liabilities and equity	Total liabilities and equity	$	3,758,477	$	3,493,226	Total liabilities and equity	$	3,987,546	$	4,005,558

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

Table of Content

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited and in thousands, except share and per share data)


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended March 31,
		2021		2020		2021		2020			2022		2021
Gross revenues:	Gross revenues:									Gross revenues:
Rental revenue	Rental revenue	$	82,353	$	83,592	$	254,570	$	243,421	Rental revenue	$	78,536	$	91,645

Other revenue	Other revenue	1,064		922		2,945		3,712		Other revenue	1,742		912
Total gross revenues	Total gross revenues	83,417		84,514		257,515		247,133		Total gross revenues	80,278		92,557
Expense applicable to revenues:	Expense applicable to revenues:									Expense applicable to revenues:
Depreciation and amortization	Depreciation and amortization	(45,359)		(40,555)		(130,579)		(120,869)		Depreciation and amortization	(44,506)		(42,176)
Property operating	Property operating	(11,406)		(11,343)		(33,966)		(31,895)		Property operating	(14,616)		(10,934)
General and administrative	General and administrative	(8,363)		(7,232)		(24,695)		(22,612)		General and administrative	(10,737)		(8,420)
Non-operating income	Non-operating income	472		40		953		314		Non-operating income	32		477
Interest and amortization expense	Interest and amortization expense	(12,210)		(13,649)		(35,170)		(42,610)		Interest and amortization expense	(10,682)		(11,486)
Debt satisfaction gains (losses), net		(13,222)		17,557		(13,222)		18,950

Impairment charges		(2,048)		(6,175)		(2,048)		(7,792)

Gains on sales of properties	Gains on sales of properties	16,122		20,878		104,767		41,876		Gains on sales of properties	255		21,919
Income before provision for income taxes and equity in earnings (losses) of non-consolidated entities	Income before provision for income taxes and equity in earnings (losses) of non-consolidated entities	7,403		44,035		123,555		82,495		Income before provision for income taxes and equity in earnings (losses) of non-consolidated entities	24		41,937
Provision for income taxes	Provision for income taxes	(270)		(286)		(986)		(1,361)		Provision for income taxes	(417)		(372)
Equity in earnings (losses) of non-consolidated entities	Equity in earnings (losses) of non-consolidated entities	(75)		(131)		(249)		35		Equity in earnings (losses) of non-consolidated entities	11,301		(90)

Net income	Net income	7,058		43,618		122,320		81,169		Net income	10,908		41,475
Less net income attributable to noncontrolling interests	Less net income attributable to noncontrolling interests	(420)		(1,714)		(1,962)		(2,245)		Less net income attributable to noncontrolling interests	(286)		(433)
Net income attributable to Lexington Realty Trust shareholders		6,638		41,904		120,358		78,924
Dividends attributable to preferred shares – Series C		(1,573)		(1,573)		(4,718)		(4,718)
Net income attributable to LXP Industrial Trust shareholders										Net income attributable to LXP Industrial Trust shareholders	10,622		41,042
Dividends attributable to preferred shares – Series C										Dividends attributable to preferred shares – Series C	(1,572)		(1,572)
Allocation to participating securities	Allocation to participating securities	(37)		(46)		(170)		(118)		Allocation to participating securities	(61)		(69)
Net income attributable to common shareholders	Net income attributable to common shareholders	$	5,028	$	40,285	$	115,470	$	74,088	Net income attributable to common shareholders	$	8,989	$	39,401

Net income attributable to common shareholders - per common share basic	Net income attributable to common shareholders - per common share basic	$	0.02	$	0.15	$	0.42	$	0.28	Net income attributable to common shareholders - per common share basic	$	0.03	$	0.14

Weighted-average common shares outstanding – basic		278,124,204		274,696,046		276,379,718		264,211,668
Weighted-average common shares outstanding – basic										Weighted-average common shares outstanding – basic	283,640,465		275,416,327

Net income attributable to common shareholders - per common share diluted	Net income attributable to common shareholders - per common share diluted	$	0.02	$	0.15	$	0.41	$	0.28	Net income attributable to common shareholders - per common share diluted	$	0.03	$	0.14

Weighted-average common shares outstanding – diluted		282,048,458		276,022,762		278,581,849		265,446,221
Weighted-average common shares outstanding – diluted										Weighted-average common shares outstanding – diluted	289,067,778		279,053,697

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

Table of Content

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited and in thousands)

Three Months Ended September 30, Nine Months Ended September 30,
2021 2020 2021 2020
Net income $ 7,058 $ 43,618 $ 122,320 $ 81,169
Other comprehensive income (loss):
Change in unrealized income (loss) on interest rate swaps, net 1,150 1,043 7,072 (17,759)
Other comprehensive income (loss) 1,150 1,043 7,072 (17,759)
Comprehensive income 8,208 44,661 129,392 63,410
Comprehensive income attributable to noncontrolling interests (420) (1,714) (1,962) (2,245)
Comprehensive income attributable to Lexington Realty Trust shareholders $ 7,788 $ 42,947 $ 127,430 $ 61,165


	Three Months Ended March 31,
	2022		2021
Net income	$	10,908	$	41,475
Other comprehensive income:

Change in unrealized income on interest rate swaps, net	12,266		5,346
Other comprehensive income	12,266		5,346
Comprehensive income	23,174		46,821
Comprehensive income attributable to noncontrolling interests	(286)		(433)
Comprehensive income attributable to LXP Industrial Trust shareholders	$	22,888	$	46,388

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

Table of Content

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Unaudited and in thousands)

Three Months Ended September 30, 2021 Lexington Realty Trust Shareholders
Total Preferred Shares Common Shares Additional Paid-in-Capital Accumulated Distributions in Excess of Net Income Accumulated Other Comprehensive Loss Noncontrolling Interests
Balance June 30, 2021 $ 2,051,369 $ 94,016 $ 28 $ 3,195,040 $ (1,250,735) $ (12,041) $ 25,061
Issuance of partnership interest in real estate 5,965 — — — — — 5,965
Redemption of noncontrolling OP units for common shares — — — 202 — — (202)
Redemption of noncontrolling OP units for real estate (22,305) — — (12,919) — — (9,386)
Issuance of common shares and deferred compensation amortization, net 57,527 — — 57,527 — — —
Dividends/distributions (32,402) — — — (32,037) — (365)
Net income 7,058 — — — 6,638 — 420
Other comprehensive income 1,150 — — — — 1,150 —
Balance September 30, 2021 $ 2,068,362 $ 94,016 $ 28 $ 3,239,850 $ (1,276,134) $ (10,891) $ 21,493


Three Months Ended September 30, 2020				Lexington Realty Trust Shareholders
Three Months Ended March 31, 2022																Three Months Ended March 31, 2022			LXP Industrial Trust Shareholders
		Total		Preferred Shares		Common Shares		Additional Paid-in-Capital		Accumulated Distributions in Excess of Net Income		Accumulated Other Comprehensive Loss		Noncontrolling Interests			Total		Number of Preferred Shares	Preferred Shares		Number of Common Shares	Common Shares		Additional Paid-in-Capital		Accumulated Distributions in Excess of Net Income		Accumulated Other Comprehensive Income/(Loss)		Noncontrolling Interests
Balance June 30, 2020		$	1,892,186	$	94,016	$	28	$	3,185,458	$	(1,386,001)	$	(20,730)	$	19,415
Balance December 31, 2021																Balance December 31, 2021	$	2,323,228	1,935,400	$	94,016	283,752,726	$	28	$	3,252,506	$	(1,049,434)	$	(6,258)	$	32,370
Issuance of partnership interest in real estate	Issuance of partnership interest in real estate	398		—		—		—		—		—		398		Issuance of partnership interest in real estate	4,109		—	—		—	—		—		—		—		4,109
Redemption of noncontrolling OP units for common shares	Redemption of noncontrolling OP units for common shares	—		—		—		150		—		—		(150)		Redemption of noncontrolling OP units for common shares	—		—	—		6,708	—		36		—		—		(36)
Purchase of noncontrolling interest in consolidated joint venture																Purchase of noncontrolling interest in consolidated joint venture	(27,958)		—	—		—	—		(25,058)		—		—		(2,900)
Issuance of common shares and deferred compensation amortization, net	Issuance of common shares and deferred compensation amortization, net	8,143		—		—		8,143		—		—		—		Issuance of common shares and deferred compensation amortization, net	40,572		—	—		4,523,173	1		40,571		—		—		—
Repurchase of common shares to settle tax obligations																Repurchase of common shares to settle tax obligations	(6,285)		—	—		(410,958)	—		(6,285)		—		—		—

Dividends/distributions		(31,039)		—		—		—		(30,651)		—		(388)
Dividends/distributions ($0.12 per common share)																Dividends/distributions ($0.12 per common share)	(36,358)		—	—		—	—		—		(36,186)		—		(172)
Net income	Net income	43,618		—		—		—		41,904		—		1,714		Net income	10,908		—	—		—	—		—		10,622		—		286
Other comprehensive income	Other comprehensive income	1,043		—		—		—		—		1,043		—		Other comprehensive income	12,266		—	—		—	—		—		—		12,266		—
Balance September 30, 2020		$	1,914,349	$	94,016	$	28	$	3,193,751	$	(1,374,748)	$	(19,687)	$	20,989

Balance March 31, 2022																Balance March 31, 2022	$	2,320,482	1,935,400	$	94,016	287,871,649	$	29	$	3,261,770	$	(1,074,998)	$	6,008	$	33,657

~~LEXINGTON REALTY~~

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Unaudited and in thousands)

Nine Months Ended September 30, 2021 Lexington Realty Trust Shareholders
Total Preferred Shares Common Shares Additional Paid-in-Capital Accumulated Distributions in Excess of Net Income Accumulated Other Comprehensive Loss Noncontrolling Interests
December 31, 2020 $ 1,991,137 $ 94,016 $ 28 $ 3,196,315 $ (1,301,726) $ (17,963) $ 20,467
Issuance of partnership interest in real estate 11,050 — — — — — 11,050
Redemption of noncontrolling OP units for common shares — — — 670 — — (670)
Redemption of noncontrolling OP units for real estate (22,305) — — (12,919) — — (9,386)
Issuance of common shares and deferred compensation amortization, net 60,469 — — 60,469 — — —
Repurchase of common shares to settle tax obligations (5,120) — — (5,120) — — —
Forfeiture of employee common shares 2 — — — 2 — —
Dividends/distributions (96,263) — — — (94,768) — (1,495)
Net income 122,320 — — — 120,358 — 1,962
Other comprehensive income 7,072 — — — — 7,072 —
Reallocation of noncontrolling interests — — — 435 — — (435)
Balance September 30, 2021 $ 2,068,362 $ 94,016 $ 28 $ 3,239,850 $ (1,276,134) $ (10,891) $ 21,493


Nine Months Ended September 30, 2020				Lexington Realty Trust Shareholders
Three Months Ended March 31, 2021																Three Months Ended March 31, 2021			LXP Industrial Trust Shareholders
		Total		Preferred Shares		Common Shares		Additional Paid-in-Capital		Accumulated Distributions in Excess of Net Income		Accumulated Other Comprehensive Loss		Noncontrolling Interests			Total		Number of Preferred Shares	Preferred Shares		Number of Common Shares	Common Shares		Additional Paid-in-Capital		Accumulated Distributions in Excess of Net Income		Accumulated Other Comprehensive Income/(Loss)		Noncontrolling Interests
Balance December 31, 2019		$	1,724,719	$	94,016	$	25	$	2,976,670	$	(1,363,676)	$	(1,928)	$	19,612
Balance December 31, 2020																Balance December 31, 2020	$	1,991,137	1,935,400	$	94,016	277,152,450	$	28	$	3,196,315	$	(1,301,726)	$	(17,963)	$	20,467
Issuance of partnership interest in real estate	Issuance of partnership interest in real estate	1,285		—		—		—		—		—		1,285		Issuance of partnership interest in real estate	2,712		—	—		—	—		—		—		—		2,712
Redemption of noncontrolling OP units for common shares	Redemption of noncontrolling OP units for common shares	—		—		—		632		—		—		(632)		Redemption of noncontrolling OP units for common shares	—		—	—		60,116	—		311		—		—		(311)
Issuance of common shares and deferred compensation amortization, net	Issuance of common shares and deferred compensation amortization, net	230,117		—		3		230,114		—		—		—		Issuance of common shares and deferred compensation amortization, net	1,517		—	—		911,202	—		1,517		—		—		—
Repurchase of common shares		(11,042)		—		—		(11,042)		—		—		—

Repurchase of common shares to settle tax obligations	Repurchase of common shares to settle tax obligations	(2,623)		—		—		(2,623)		—		—		—		Repurchase of common shares to settle tax obligations	(5,120)		—	—		(499,638)	—		(5,120)		—		—		—
Forfeiture of employee common shares	Forfeiture of employee common shares	1		—		—		—		1		—		—		Forfeiture of employee common shares	2		—	—		(9,274)	—		—		2		—		—
Dividends/distributions		(91,518)		—		—		—		(89,997)		—		(1,521)
Dividends/distributions ($0.1075 per common share)																Dividends/distributions ($0.1075 per common share)	(31,743)		—	—		—	—		—		(31,369)		—		(374)
Net income	Net income	81,169		—		—		—		78,924		—		2,245		Net income	41,475		—	—		—	—		—		41,042		—		433
Other comprehensive loss		(17,759)		—		—		—		—		(17,759)		—
Balance September 30, 2020		$	1,914,349	$	94,016	$	28	$	3,193,751	$	(1,374,748)	$	(19,687)	$	20,989
Other comprehensive income																Other comprehensive income	5,346		—	—		—	—		—		—		5,346		—
Balance March 31, 2021																Balance March 31, 2021	$	2,005,326	1,935,400	$	94,016	277,614,856	$	28	$	3,193,023	$	(1,292,051)	$	(12,617)	$	22,927

Table of Content

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited and in thousands)


		Nine Months Ended September 30,					Three Months Ended March 31,
		2021		2020			2022		2021
Net cash provided by operating activities:	Net cash provided by operating activities:	$	167,405	$	152,466	Net cash provided by operating activities:	$	42,090	$	57,400
Cash flows from investing activities:	Cash flows from investing activities:					Cash flows from investing activities:
Acquisition of real estate, including intangible assets	Acquisition of real estate, including intangible assets	(392,586)		(429,834)		Acquisition of real estate, including intangible assets	(72,148)		(50,778)
Investment in real estate under construction	Investment in real estate under construction	(119,885)		(21,561)		Investment in real estate under construction	(75,368)		(29,988)
Capital expenditures	Capital expenditures	(9,371)		(15,328)		Capital expenditures	(5,991)		(1,303)
Net proceeds from sale of properties	Net proceeds from sale of properties	181,242		99,740		Net proceeds from sale of properties	255		56,509

Principal payments received on loans receivable						Principal payments received on loans receivable	7		—

Investment in loans receivable		(1,497)		—

Investments in non-consolidated entities	Investments in non-consolidated entities	(975)		(6,152)		Investments in non-consolidated entities	(121)		(553)
Distributions from non-consolidated entities in excess of accumulated earnings	Distributions from non-consolidated entities in excess of accumulated earnings	6,170		6,843		Distributions from non-consolidated entities in excess of accumulated earnings	1,537		2,743

Deferred leasing costs	Deferred leasing costs	(5,546)		(4,791)		Deferred leasing costs	(536)		(2,232)

Change in real estate deposits, net	Change in real estate deposits, net	(1,658)		461		Change in real estate deposits, net	(167)		686
Net cash used in investing activities	Net cash used in investing activities	(344,106)		(370,622)		Net cash used in investing activities	(152,532)		(24,916)
Cash flows from financing activities:	Cash flows from financing activities:					Cash flows from financing activities:
Dividends to common and preferred shareholders	Dividends to common and preferred shareholders	(95,885)		(87,966)		Dividends to common and preferred shareholders	(36,827)		(33,453)

Proceeds from mortgage loans		11,610		—

Principal amortization payments	Principal amortization payments	(10,571)		(16,132)		Principal amortization payments	(2,779)		(4,760)
Principal payments on debt, excluding normal amortization		(10,567)		—

Revolving credit facility borrowings		215,000		170,000
Revolving credit facility payments		(215,000)		(170,000)
Proceeds from issuance of senior notes		399,032		396,932
Repurchase of senior notes		(188,756)		(112,312)

Deferred financing costs		(3,977)		(3,803)
Payments for early extinguishment of debt		(12,217)		(9,477)

Cash contributions from noncontrolling interests	Cash contributions from noncontrolling interests	10,560		1,285		Cash contributions from noncontrolling interests	4,109		2,223
Cash distributions to noncontrolling interests	Cash distributions to noncontrolling interests	(1,495)		(1,521)		Cash distributions to noncontrolling interests	(172)		(374)

Purchase of noncontrolling interest						Purchase of noncontrolling interest	(27,958)		—

Repurchases to settle tax obligations	Repurchases to settle tax obligations	(5,120)		(2,623)		Repurchases to settle tax obligations	(6,285)		(5,120)
Issuance of common shares, net	Issuance of common shares, net	55,116		225,122		Issuance of common shares, net	38,495		(246)
Repurchase of common shares		—		(11,042)

Net cash provided by financing activities		147,730		378,463

Net cash used in financing activities						Net cash used in financing activities	(31,417)		(41,730)
Change in cash, cash equivalents and restricted cash	Change in cash, cash equivalents and restricted cash	(28,971)		160,307		Change in cash, cash equivalents and restricted cash	(141,859)		(9,246)
Cash, cash equivalents and restricted cash, at beginning of period	Cash, cash equivalents and restricted cash, at beginning of period	179,421		129,310		Cash, cash equivalents and restricted cash, at beginning of period	191,027		179,421
Cash, cash equivalents and restricted cash, at end of period	Cash, cash equivalents and restricted cash, at end of period	$	150,450	$	289,617	Cash, cash equivalents and restricted cash, at end of period	$	49,168	$	170,175

Reconciliation of cash, cash equivalents and restricted cash:	Reconciliation of cash, cash equivalents and restricted cash:					Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents at beginning of period	Cash and cash equivalents at beginning of period	$	178,795	$	122,666	Cash and cash equivalents at beginning of period	$	190,926	$	178,795
Restricted cash at beginning of period	Restricted cash at beginning of period	626		6,644		Restricted cash at beginning of period	101		626
Cash, cash equivalents and restricted cash at beginning of period	Cash, cash equivalents and restricted cash at beginning of period	$	179,421	$	129,310	Cash, cash equivalents and restricted cash at beginning of period	$	191,027	$	179,421

Cash and cash equivalents at end of period	Cash and cash equivalents at end of period	$	150,077	$	287,920	Cash and cash equivalents at end of period	$	49,063	$	142,074
Restricted cash at end of period	Restricted cash at end of period	373		1,697		Restricted cash at end of period	105		28,101
Cash, cash equivalents and restricted cash at end of period	Cash, cash equivalents and restricted cash at end of period	$	150,450	$	289,617	Cash, cash equivalents and restricted cash at end of period	$	49,168	$	170,175

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

Table of Contents

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(1) The Company and Financial Statement Presentation

~~Lexington Realty~~LXP Industrial Trust (together with its consolidated subsidiaries, except when the context only applies to the parent entity, the ~~“Company”~~“Company”) is a Maryland real estate investment trust ~~(“REIT”~~(“REIT”) that owns a portfolio of equity investments focused on single-tenant industrial properties.

As of ~~September 30, 2021,~~March 31, 2022, the Company had ownership interests in approximately ~~140~~123 consolidated real estate properties, located in 2823 states. The properties in which the Company has an interest are primarily net leased to tenants in various industries.

The Company believes it has qualified as a REIT under the Internal Revenue Code of 1986, as amended (the ~~“Code”~~“Code”). Accordingly, the Company will not be subject to federal income tax, provided that distributions to its shareholders equal at least the amount of its REIT taxable income as defined under the Code. The Company is permitted to participate in certain activities from which it was previously precluded in order to maintain its qualification as a REIT, so long as these activities are conducted in entities which elect to be treated as taxable REIT subsidiaries ~~(“TRS”~~(“TRS”) under the Code. As such, the TRS are subject to federal income taxes on the income from these activities.

The Company conducts its operations indirectly through (1) property owner subsidiaries, which are single purpose entities, (2) a wholly-owned TRS, Lexington Realty Advisors, Inc. ~~(“LRA”~~(“LRA”), and (3) joint ventures. Property owner subsidiaries are landlords under leases for properties in which the Company has an interest and/or borrowers under loan agreements secured by properties in which the Company has an interest and lender subsidiaries are lenders under loan agreements where the Company made an investment in a loan asset, but in all cases are separate and distinct legal entities. Each property owner subsidiary is a separate legal entity that maintains separate books and records. The assets and credit of each property owner subsidiary with a property subject to a mortgage loan are not available to creditors to satisfy the debt and other obligations of any other person, including any other property owner subsidiary or any other affiliate. Consolidated entities that are not property owner subsidiaries do not directly own any of the assets of a property owner subsidiary (or the general partner, member or managing member of such property owner subsidiary), but merely hold partnership, membership or beneficial interests therein, which interests are subordinate to the claims of such property owner subsidiary's (or its general partner's, member's or managing member's) creditors.

The financial statements contained in this Quarterly Report on Form 10-Q (this ~~“Quarterly Report”~~“Quarterly Report”) for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021 have been prepared by the Company in accordance with U.S. generally accepted accounting principles ~~(“GAAP”~~(“GAAP”) for interim financial information and the applicable rules and regulations of the Securities and Exchange Commission ~~(“SEC”~~(“SEC”). Accordingly, they do not include all information and footnotes required by GAAP for complete financial statements. However, in the opinion of management, the interim financial statements include all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of the results of the periods presented. Interim results are not necessarily indicative of the results that may be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, ~~2020~~2021 filed with the SEC on February ~~18, 2021 (“~~24, 2022 (“Annual ~~Report”~~Report”).

Basis of Presentation and Consolidation. The Company's unaudited condensed consolidated financial statements are prepared on the accrual basis of accounting in accordance with GAAP. The financial statements reflect the accounts of the Company and its consolidated subsidiaries. The Company consolidates the wholly-owned subsidiaries, partnerships and joint ventures which it controls (i) through voting rights or similar rights or (ii) by means other than voting rights if the Company is the primary beneficiary of a variable interest entity ("VIE"). Entities which the Company does not control and entities which are VIEs in which the Company is not a primary beneficiary are accounted for under appropriate GAAP.

~~During the nine months ended September 30,~~

Table of Contents

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

As of March 31, 2022, the Company ~~acquired~~had interests in 47 joint ventures with developers, consisting of 5 ongoing development projects and 2 land joint ventures with ownership interests ranging from 80% to ~~93%~~95.5%. Each joint venture ~~acquired~~owns land parcels ~~to develop~~with the intention of developing industrial properties. The Company determined that the joint ventures are variable interest entities in accordance with the applicable accounting guidance. The Company concluded that it is the primary beneficiary in each of the joint ventures and as such, the joint ventures' operations are consolidated in the ~~Company’s~~Company’s financial statements.

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

In addition, the Company is the primary beneficiary of certain other VIEs as it has a controlling financial interest in these entities. Lepercq Corporate Income Fund L.P. ("LCIF") ~~and ATL Fairburn L.P. ("Fairburn JV"), are~~is a consolidated VIE and the Company, as of ~~September 30, 2021,~~March 31, 2022, had an approximate 99% ~~and 87% interest, respectively, are VIEs.~~ownership interest.

The assets of each VIE are only available to satisfy such VIE's respective liabilities. ~~As of September 30, 2021 and December 31, 2020, the VIEs' mortgages and notes payable were non-recourse to the Company.~~ Below is a summary of selected financial data of the consolidated VIEs for which the Company is the primary beneficiary included in the unaudited condensed consolidated balance sheets as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020:~~2021:

September 30, 2021 December 31, 2020
Real estate, net $ 655,464 $ 569,461
Total assets $ 706,320 $ 679,786
Mortgages and notes payable, net $ 25,616 $ 25,600
Total liabilities $ 47,065 $ 40,974


	March 31, 2022		December 31, 2021
Real estate, net	$	871,972	$	810,087
Total assets	$	932,996	$	952,611

Total liabilities	$	44,737	$	47,011

In addition, the Company acquires, from time to time, properties using a reverse like-kind exchange structure pursuant to Section 1031 of the Internal Revenue Code (a "reverse 1031 exchange") and, as such, the properties are in the possession of an Exchange Accommodation Titleholder ("EAT") until the reverse 1031 exchange is completed. The EAT is classified as a VIE as it is a ~~“thinly capitalized”~~“thinly capitalized” entity. The Company consolidates the EAT because it is the primary beneficiary as it has the ability to control the activities that most significantly impact the EAT's economic performance and can collapse the 1031 exchange structure at any time. The assets of the EAT primarily consist of leased property (net real estate and intangibles).

Revenue Recognition. The Company recognizes lease revenue on a straight-line basis over the term of the lease unless another systematic and rational basis is more representative of the time pattern in which the use benefit is derived from the leased property. Revenue is recognized on a contractual basis for leases with escalations tied to a consumer price index with no floor. The Company evaluates the collectability of its rental payments and recognizes revenue on a cash basis when the Company believes it is no longer probable that it will receive substantially all of the remaining lease payments. Renewal options in leases ~~with rental terms that are lower than those in the primary term~~ are excluded from the calculation of straight-line rent if the renewals are not reasonably certain. If the Company funds tenant improvements and the improvements are deemed to be owned by the Company, revenue recognition will commence when the improvements are substantially completed and possession or control of the space is turned over to the tenant. If the Company determines that the tenant allowances are lease incentives, the Company commences revenue recognition when possession or control of the space is turned over to the tenant for tenant work to begin. The lease incentive is recorded as a deferred expense and amortized as a reduction of revenue on a straight-line basis over the respective lease term. The Company recognizes lease termination fees as rental revenue in the period received and writes off unamortized lease-related intangible and other lease-related account balances, provided there are no further Company obligations under the lease. Otherwise, such fees and balances are recognized on a straight-line basis over the remaining obligation period with the termination payments being recorded as a component of rent receivable-deferred on the unaudited condensed consolidated balance sheets.

Use of Estimates. Management has made a number of significant estimates and assumptions relating to the reporting of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses to prepare these unaudited condensed consolidated financial statements in conformity with GAAP. These estimates and assumptions are based on management's best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. Management adjusts such estimates when facts and circumstances dictate. The most significant estimates made include the recoverability of current and deferred accounts receivable and, allocation of property purchase price to tangible and intangible assets acquired and liabilities assumed, the determination of VIEs

Table of Contents

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

and which entities should be consolidated, the determination of impairment of long-lived assets and equity method investments, valuation of derivative financial instruments, valuation of awards granted under compensation plans, the determination of the incremental borrowing rate for leases where the Company is the lessee and the useful lives of long-lived assets. Actual results could differ materially from those estimates.

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

~~Cost Capitalization.~~ The Company capitalizes interest and direct and indirect project costs associated with the initial construction of a property up to the time the property is substantially complete and ready for its intended use within investments in real estate under construction in the unaudited condensed consolidated balance sheets. In addition, the Company capitalizes operating costs, including real estate taxes, insurance and utilities, that have been allocated to vacant space based on the square footage of the portion of the building not held available for immediate occupancy during the extended lease-up periods after the construction of the building shell has been completed if costs are being incurred to ready the vacant space for its intended use. If costs and activities incurred to ready the vacant space cease, then cost capitalization is also discontinued until such activities are resumed. Once construction has been completed on a vacant space, project costs are no longer capitalized.

Restricted Cash. Restricted cash is comprised primarily of cash balances held by ~~lenders and operating cash reserves held at one property.~~lenders.

Fair Value Measurements. The Company follows the guidance in the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures ("Topic 820"), to determine the fair value of financial and non-financial instruments. Topic 820 defines fair value, establishes a framework for measuring fair value in GAAP and expands disclosures about fair value measurements. Topic 820 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three levels: Level 1 - quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities; Level 2 - observable prices that are based on inputs not quoted in active markets, but corroborated by market data; and Level 3 - unobservable inputs, which are used when little or no market data is available. The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible, as well as considering counterparty credit risk. The Company has formally elected to apply the portfolio exception within Topic 820 with respect to measuring counterparty risk for all of its derivative transactions subject to master netting arrangements.

The Company estimates the fair value of its real estate assets, including non-consolidated real estate assets, by using income and market valuation techniques. The Company may estimate fair values using market information such as recent sale contracts (Level 2 inputs) or recent sale offers or discounted cash flow models, which primarily rely on Level 3 inputs. The cash flow models include estimated cash inflows and outflows over a specified holding period. These cash flows may include contractual rental revenues, projected future rental revenues and expenses and forecasted tenant improvements and lease commissions based upon market conditions determined through discussion with local real estate professionals, experience the Company has with its other owned properties in such markets and expectations for growth. Capitalization rates and discount rates utilized in these models are estimated by management based upon rates that management believes to be within a reasonable range of current market rates for the respective properties based upon an analysis of factors such as property and tenant quality, geographical location and local supply and demand observations. To the extent the Company under-estimates forecasted cash out flows (tenant improvements, lease commissions and operating costs) or over-estimates forecasted cash inflows (rental revenue rates), the estimated fair value of its real estate assets could be overstated.

Cost Capitalization. The Company capitalizes interest and direct and indirect project costs associated with the initial construction of a property up to the time the property is substantially complete and ready for its intended use within investments in real estate under construction in the unaudited condensed consolidated balance sheets. If costs and activities incurred to ready the vacant space cease, then cost capitalization is also discontinued until such activities are resumed. Once construction has been completed on a vacant space, project costs are no longer capitalized.

Recently Issued Accounting Guidance. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848). ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts that reference the London Interbank Offered Rate, or LIBOR, or another reference rate expected to be discontinued because of reference rate reform. The guidance in ASU 2020-04 is optional, applies for a limited period of time to ease the potential burden in accounting for (or recognizing the effect of) reference rate reform on financial reporting, in response to concerns about structural risks of interbank offered rates, and, particularly, the risk of cessation of LIBOR and may be elected over time as reference rate reform activities occur. As of March 31, 2020, the Company has elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.

Table of Contents

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

In July 2021, the FASB issued ASU 2021-05, Leases (Topic 842): Lessors-Certain Leases with Variable Lease Payments, to amend the guidance to provide alternative accounting for sales type and direct finance leases with variable lease payments. The amendments in ASU 2021-05 amend the accounting guidance to allow lessors to classify and account for a lease with variable leases payments that do not depend on a reference index or a rate as an operating lease if certain criteria are met. The standard is effective for fiscal years beginning after December 15, 2021 with early adoption permitted. The Company does not currently have any leases that are classified as sales-type or direct finance leases. Therefore, the Company determined that it will apply the amendment on a prospective basis to applicable leases that commence or are modified on or after July 1, 2021.

(2)Earnings Per Share

A portion of the Company's non-vested share-based payment awards are considered participating securities and as such, the Company is required to use the two-class method for the computation of basic and diluted earnings per share. Under the two-class computation method, net losses are not allocated to participating securities unless the holder of the security has a contractual obligation to share in the losses. The non-vested share-based payment awards are not allocated losses as the awards do not have a contractual obligation to share in losses of the Company.

The following is a reconciliation of the numerators and denominators of the basic and diluted earnings per share computations for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 and ~~2020:~~2021:


		Three Months Ended September 30,				Nine months ended September 30,				Three Months Ended March 31,
		2021		2020		2021		2020				2022		2021
BASIC	BASIC										BASIC

Net income attributable to common shareholders	Net income attributable to common shareholders	$	5,028	$	40,285	$	115,470	$	74,088		Net income attributable to common shareholders	$	8,989	$	39,401
Weighted-average number of common shares outstanding - basic	Weighted-average number of common shares outstanding - basic	278,124,204		274,696,046		276,379,718		264,211,668			Weighted-average number of common shares outstanding - basic	283,640,465		275,416,327

Net income attributable to common shareholders - per common share basic	Net income attributable to common shareholders - per common share basic	$	0.02	$	0.15	$	0.42	$	0.28		Net income attributable to common shareholders - per common share basic	$	0.03	$	0.14

DILUTED	DILUTED										DILUTED
Net income attributable to common shareholders - basic											Net income attributable to common shareholders - basic	$	8,989	$	39,401

Impact of assumed conversions											Impact of assumed conversions	—		240
Net income attributable to common shareholders	Net income attributable to common shareholders	$	5,028	$	40,285	$	115,470	$	74,088		Net income attributable to common shareholders	$	8,989	$	39,641

Weighted-average common shares outstanding - basic	Weighted-average common shares outstanding - basic	278,124,204		274,696,046		276,379,718		264,211,668			Weighted-average common shares outstanding - basic	283,640,465		275,416,327
Effect of dilutive securities:	Effect of dilutive securities:										Effect of dilutive securities:
Shares issuable under forward sales agreements	Shares issuable under forward sales agreements	2,765,030		—		1,290,968		—			Shares issuable under forward sales agreements	4,348,422		9,843
Unvested share-based payment awards and options		1,159,224		1,326,716		911,163		1,234,553
Unvested share-based payment awards											Unvested share-based payment awards	1,078,891		775,108

Operating partnership units											Operating partnership units	—		2,852,419

Weighted-average common shares outstanding - diluted	Weighted-average common shares outstanding - diluted	282,048,458		276,022,762		278,581,849		265,446,221			Weighted-average common shares outstanding - diluted	289,067,778		279,053,697

Net income attributable to common shareholders - per common share diluted	Net income attributable to common shareholders - per common share diluted	$	0.02	$	0.15	$	0.41	$	0.28		Net income attributable to common shareholders - per common share diluted	$	0.03	$	0.14

For per common share amounts, all incremental shares are considered anti-dilutive for periods that have a loss from continuing operations attributable to common shareholders. In addition, other common share equivalents may be anti-dilutive in certain periods.

Table of Contents

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(3)Investments in Real Estate

The Company completed the following warehouse/distribution acquisition ~~and development~~ transactions during the ~~nine~~three months ended ~~September 30, 2021:~~March 31, 2022:

Market(1)
Acquisition/Completion
Date Initial
Cost
Basis Primary
Lease
Expiration at Acquisition Date Land Building and Improvements Lease in-place Value Intangible Above (Below) Market Lease Intangible, net
Indianapolis, IN January 2021 $ 14,310 12/2024 $ 1,208 $ 12,052 $ 1,035 $ 15
Indianapolis, IN January 2021 14,120 08/2025 1,162 11,825 1,133 —
Central Florida January 2021 22,358 05/2031 1,416 19,910 1,032 —
Columbus, OH(2)
March 2021(2)
19,517 03/2024 2,800 16,717 — —
Houston, TX May 2021 28,292 08/2028 4,272 22,295 1,725 —
Houston, TX May 2021 37,686 12/2026 6,489 28,470 2,727 —
Houston, TX May 2021 11,512 08/2024 1,792 9,089 631 —
Cincinnati/Dayton, OH June 2021 18,674 06/2023 1,109 16,477 1,088 —
Central Florida June 2021 48,593 N/A 2,610 45,983 — —
Greenville-Spartanburg, SC June 2021 36,903 09/2025 2,376 32,121 2,406 —
Greenville-Spartanburg, SC June 2021 23,812 06/2026 1,329 21,419 1,064 —
Greenville-Spartanburg, SC July 2021 29,421 04/2029 2,819 24,508 2,094 —
Greenville-Spartanburg, SC July 2021 26,106 12/2029 1,169 23,070 1,867 —
Greenville-Spartanburg, SC(3)
July 2021 18,394 N/A 1,020 17,374 — —
Greenville-Spartanburg, SC July 2021 31,646 09/2026 1,710 27,817 2,119 —
Columbus, OH August 2021 29,265 11/2029 2,251 25,184 1,830 —
$ 410,609 $ 35,532 $ 354,311 $ 20,751 $ 15


Market	Acquisition Date	Initial Cost Basis		Primary Lease Expiration at Acquisition Date	Land		Building and Improvements		Lease in-place Intangible
Cincinnati/Dayton, OH(1)	February 2022	$	23,382	N/A	$	2,010	$	21,372	$	—
Cincinnati/Dayton, OH	February 2022	48,660		04/2032	4,197		40,944		3,519



		$	72,042		$	6,207	$	62,316	$	3,519

(1) ~~A land parcel located in Hebron, OH was also purchased for $371.~~

~~(2) Development project substantially completed and placed into service in March 2021.~~

~~(3)~~ Subsequent to acquisition, property was fully leased for ~~5.5~~approximately nine years.

In 2022, the Company purchased the remaining 13% of equity owned by a noncontrolling interest in the Fairburn, Georgia warehouse/distribution facility for $27,958. As the Company previously consolidated its interest in the joint venture which owned the property, the acquisition of the noncontrolling ownership interest was recorded as an equity transaction with the difference between the purchase price and carrying balance of $25,058 recorded as a reduction in additional paid-in-capital.

As of ~~September 30, 2021,~~March 31, 2022, the details of the warehouse/distribution real estate under construction are as follows (in $000's, except square feet):

Project (% owned) # of Buildings Market Estimated Sq. Ft. Estimated Project Cost GAAP Investment Balance as of 9/30/2021
Amount Funded as of 9/30/2021(3)
Estimated Building Completion Date % Leased as of 9/30/2021 Approximate Lease Term (Years)
Fairburn (87%)(1)(2)
1 Atlanta, GA 907,675 $ 53,800 $ 47,551 $ 43,900 2Q 2021 — % TBD
KeHE Distributors, BTS (100%) 1 Phoenix, AZ 468,182 72,000 60,044 52,329 4Q 2021 100 % 15
Mt. Comfort (80%)(1)
1 Indianapolis, IN 1,053,360 60,300 15,808 9,912 2Q 2022 — % TBD
Smith Farms (90%)(1)
3 Greenville-Spartansburg, SC 1,939,524 132,800 17,609 13,396 2Q 2022 — % TBD
Cotton 303 (93%)(1)
2 Phoenix, AZ 880,678 84,200 23,636 20,339 2Q 2022 — % TBD
Ocala (80%)(1)
1 Central Florida 1,085,280 80,900 21,056 15,093 3Q 2022 — % TBD
$ 484,000 $ 185,704 $ 154,969


Project (% owned)	# of Buildings	Market	Estimated Sq. Ft.	Estimated Project Cost		GAAP Investment Balance as of 3/31/2022		LXP Amount Funded as of 3/31/2022(3)		Estimated Building Completion Date	% Leased as of 3/31/2022
The Cubes at Etna East (95%)(1)	1	Columbus, OH	1,074,840	$	72,100	$	44,205	$	37,446	3Q 2022	—	%
Ocala (80%)(1)	1	Central Florida	1,085,280	81,200		51,808		36,151		3Q 2022	—	%
Cotton 303 (93%)(1)	2	Phoenix, AZ	880,678	84,200		40,176		35,306		4Q 2022	—	%
Mt. Comfort (80%)(1)	1	Indianapolis, IN	1,053,360	66,400		32,388		24,462		4Q 2022	—	%
Smith Farms (90%)(1)(2)	3	Greenville-Spartanburg, SC	2,194,820	162,500		62,681		46,968		4Q 2022 - 2Q 2023	36	%

				$	466,400	$	231,258	$	180,333

(1) Estimated project cost includes estimated tenant improvements and leasing costs and excludes potential developer partner promote.

(2) ~~Base building substantially completed during~~ Pre-leased 797,936 square foot facility subject to a 12-year lease commencing upon substantial completion of the ~~second quarter of 2021. Property not placed into service as of September 30, 2021. Subsequent to September 30, 2021, signed a~~ ~~seven-year lease for all 907,675 square feet.~~facility.

(3) Excludes noncontrolling interests' share.

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

As of ~~September 30, 2021,~~March 31, 2022, the Company's aggregate investment in the development arrangements was ~~$185,704,~~$231,258, which included capitalized interest of ~~$1,806~~$1,146 for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 and is presented as investments in real estate under construction in the accompanying unaudited condensed consolidated balance ~~sheets.~~sheet. For the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, capitalized interest for ~~the~~ development arrangements was ~~$578.~~$502.

As of March 31, 2022, the details of the land held for development are as follows (in $000's, except acres):


Project (% owned)	Market	Approx. Developable Acres	GAAP Investment Balance as of 3/31/2022		LXP Amount Funded as of 3/31/2022 (1)
Consolidated:
Reems & Olive (95.5%)	Phoenix, AZ	420	$	101,047	$	96,544
Mt. Comfort Phase II (80%)	Indianapolis, IN	70	3,300		2,612
		490	$	104,347	$	99,156

(1) Excludes noncontrolling interests' share.

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LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(4)Dispositions and Impairment

During the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ the Company disposed of its interests in various properties for an aggregate gross disposition price of ~~$218,796~~$289 and ~~$140,573,~~$58,092, respectively, and recognized aggregate gains on sales of properties of ~~$104,767~~$255 and ~~$41,876,~~$21,919, respectively.

Included in the 2021 dispositions are 3 non-industrial properties with a disposition price of $35,369, which was satisfied through (i) the redemption of 1,598,906 operating partnership units ("OP units"), (ii) the assumption of $11,610 of third party mortgage financing that encumbered 2 of the properties and (iii) $1,497 of seller financing. The ~~seller financing note receivable has a fixed interest rate of 6.0% per annum and matures on August 1, 2025.~~

Included in the 2020 dispositions are 2 office properties located in Charleston, South Carolina and Overland Park, Kansas, each of which was conveyed to the lender in forgiveness of the mortgage loan encumbering the applicable property. The balance of the non-recourse mortgage loan was in excess of the value of the property collateral, resulting in a debt satisfaction gain, net of $29,016.

~~As of September 30, 2021, the~~ Company had 410 and 8 properties classified as held for sale ~~because the properties met the criteria included under the held for sale accounting guidance~~at March 31, 2022 and ~~a sale to a third party within the next 12 months was deemed probable. As of~~ December 31, ~~2020, the Company had 2 properties that met the held for sale criteria.~~

2021, respectively. Assets and liabilities of the held for sale properties as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~2021 consisted of the following:


		September 30, 2021		December 31, 2020			March 31, 2022		December 31, 2021
Assets:	Assets:					Assets:
Real estate, at cost	Real estate, at cost	$	37,406	$	32,629	Real estate, at cost	$	204,029	$	170,117
Real estate, intangible assets	Real estate, intangible assets	6,417		7,941		Real estate, intangible assets	15,161		9,454
Accumulated depreciation and amortization	Accumulated depreciation and amortization	(14,246)		(24,312)		Accumulated depreciation and amortization	(116,242)		(99,659)
Deferred expenses, net						Deferred expenses, net	1,822		1,759

Other	Other	568		272		Other	1,883		915
		$	30,145	$	16,530		$	106,653	$	82,586

Liabilities:	Liabilities:					Liabilities:
Accounts payable and liabilities						Accounts payable and liabilities	$	1,779	$	1,908
Deferred revenue						Deferred revenue	443		483
Prepaid rent						Prepaid rent	1,657		1,077
							$	3,879	$	3,468
Accounts payable and other liabilities		$	1,122	$	790

The Company assesses on a regular basis whether there are any indicators that the carrying value of its real estate assets may be impaired. Potential indicators may include an increase in vacancy at a property, tenant financial instability, change in the estimated holding period of the asset, the potential sale or transfer of the property in the near future and changes in economic conditions. An asset is determined to be impaired if the asset's carrying value is in excess of its estimated fair value and the Company estimates that its cost will not be recovered.

During the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, the Company recognized an impairment charge of $2,048 related to a vacant office property located in McDonough, Georgia. During the nine months ended September 30, 2020, the Company recognized aggregatethere were no impairment charges of $7,792, consisting of 2 impairment charges of $1,617 and $6,175 on a vacant office property located in Houston, Texas, later sold in 2020, and an industrial property located in Kalamazoo, Michigan, respectively.

~~Table of Contents~~recorded.

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

(5)Fair Value Measurements

The following tables present the Company's assets and liabilities measured at fair value on a recurring and non-recurring basis as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, aggregated by the level in the fair value hierarchy within which those measurements fall:


		Balance		Fair Value Measurements Using							Balance		Fair Value Measurements Using
Description	Description	September 30, 2021		(Level 1)		(Level 2)		(Level 3)		Description	March 31, 2022		(Level 1)		(Level 2)		(Level 3)
Interest rate swap liabilities		$	(10,891)	$	—	$	(10,891)	$	—
Impaired real estate assets(1)		$	2,980	$	—	$	—	$	2,980
Interest rate swap assets										Interest rate swap assets	$	6,008	$	—	$	6,008	$	—

		Balance		Fair Value Measurements Using							Balance		Fair Value Measurements Using
Description	Description	December 31, 2020		(Level 1)		(Level 2)		(Level 3)		Description	December 31, 2021		(Level 1)		(Level 2)		(Level 3)
Interest rate swap liabilities	Interest rate swap liabilities	$	(17,963)	$	—	$	(17,963)	$	—	Interest rate swap liabilities	$	(6,258)	$	—	$	(6,258)	$	—
Impaired real estate assets~~(2)~~(1)	Impaired real estate assets~~(2)~~(1)	$	21,141	$	—	$	2,480	$	18,661	Impaired real estate assets~~(2)~~(1)	$	12,735	$	—	$	—	$	12,735

(1) Represents non-recurring fair value ~~measurement as of the impairment date. The fair value is calculated as of the impairment date.~~measurement. The Company measured ~~the $2,980~~a $12,735 fair value of real estate assets based on a discounted cash flow analysis using a discount rate ranging from8.0% to 10.0% and a residual capitalization rate of 8.0%, respectively. As significant inputs to the discounted cash flow models are unobservable, the Company determined that the value determined for this property falls within Level 3 of the fair value reporting hierarchy.

(2) Represents non-recurring fair value measurement as of the impairment date. The fair value is calculated as of the impairment date. $2,480 was based on an observable contract thus Level 2. The Company measured $18,661 of these fair values based on discounted cash flow analysis, using a discount rate of 9.0% and residual capitalization rates ranging from ~~8.0%~~7.5% to ~~9.0%~~8.0%. As significant inputs to the ~~discounted cash flow~~ models are unobservable, the Company determined that the value determined for these properties falls within Level 3 of the fair value reporting hierarchy.

The majority of the inputs used to value the Company's interest rate swaps fell within Level 2 of the fair value hierarchy, such as observable market interest rate curves; however, the credit valuation associated with the interest rate

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LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

swaps utilized Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by the Company and its counterparties. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company determined that the credit valuation adjustment relative to the overall fair value of the interest rate swaps was not significant. As a result, the interest rate swaps were classified in Level 2 of the fair value hierarchy.

The table below sets forth the carrying amounts and estimated fair values of the Company's financial instruments, excluding held for sale assets, as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020:~~2021:

As of September 30, 2021 As of December 31, 2020
Carrying
Amount Fair Value Carrying
Amount Fair Value
Liabilities
Debt $ 1,529,113 $ 1,533,534 $ 1,341,242 $ 1,368,151


	As of March 31, 2022				As of December 31, 2021
	Carrying Amount		Fair Value		Carrying Amount		Fair Value



Liabilities
Debt	$	1,494,849	$	1,416,302	$	1,497,064	$	1,491,868

The fair value of the Company's debt is primarily estimated utilizing Level 3 inputs by using a discounted cash flow analysis, based upon estimates of market interest rates, except for the Company's senior notes payable. The Company determines the fair value of its senior notes payable using market prices. The inputs used in determining the fair value of these notes are categorized as Level 1 due to the fact that the Company uses quoted market rates to value these instruments. However, the inputs used in determining the fair value could be categorized as Level 2 if trading volumes are low.

Fair values cannot be determined with precision, may not be substantiated by comparison to quoted prices in active markets and may not be realized upon sale. Additionally, there are inherent uncertainties in any fair value measurement technique, and changes in the underlying assumptions used, including discount rates, liquidity risks and estimates of future cash flows, could significantly affect the fair value measurement amounts.

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

Cash Equivalents, Restricted Cash, Accounts Receivable and Accounts Payable. The Company estimates that the fair value of cash equivalents, restricted cash, accounts receivable and accounts payable approximates carrying value due to the relatively short maturity of the instruments.

(6)Investments in Non-Consolidated Entities

Below is a schedule of the Company's investments in non-consolidated entities:


			Percentage Ownership at	Investment Balance as of						Percentage Ownership at	Investment Balance as of
Investment	Investment		September 30, 2021	September 30, 2021		December 31, 2020		Investment		March 31, 2022	March 31, 2022		December 31, 2021
NNN Office JV LP ("NNN JV")		(1)	20%	$	26,030	$	31,615
NNN MFG Cold JV L.P. ("MFG Cold JV")								NNN MFG Cold JV L.P. ("MFG Cold JV")	(1)	20%	$	30,601	$	30,752
NNN Office JV L.P. ("NNN JV")								NNN Office JV L.P. ("NNN JV")	(2)	20%	24,051		24,112
Etna Park 70 LLC	Etna Park 70 LLC	(2)	90%	12,857		12,514		Etna Park 70 LLC	(3)	90%	12,927		12,874
Etna Park East LLC	Etna Park East LLC	(3)	90%	7,979		7,484		Etna Park East LLC	(4)	90%	2,112		2,797
BSH Lessee L.P.	BSH Lessee L.P.	(4)	25%	4,155		4,851		BSH Lessee L.P.	(5)	25%	3,884		4,024
				$	51,021	$	56,464				$	73,575	$	74,559

(1) MFG Cold JV is a joint venture formed in 2021 and owns special purpose industrial properties formerly owned by the Company.

(2) NNN JV is a joint venture formed in 2018 and owns office properties formerly owned by the Company.

~~(2)~~(3) Joint venture formed in 2017 with a developer entity to acquire a parcel of land. The Company determined that it is not the primary beneficiary.

~~(3)~~(4) Joint venture formed in 2019 with a developer entity to acquire a parcel of land. The Company determined that it is not the primary beneficiary.

~~(4)~~(5) A joint venture investment, which owns a single-tenant, net-leased asset.

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LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

During the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2022, NNN JV sold 2 assets and the Company recognized a gain on the transaction of ~~$557~~$11,315 within equity in earnings (losses) of non-consolidated entities in its unaudited condensed consolidated statement of operations. In conjunction with these property sales, NNN JV received net proceeds of ~~$8,504~~$57,879 after the satisfaction of an aggregate of ~~$40,800~~$108,960 of its non-recourse mortgage indebtedness. NNN JV distributed $11,513 of net proceeds to the Company as a result of the property sales.

The following is a summary of the results of operations of NNN JV for the three months ended March 31, 2022 and 2021:


	Three months ended March 31,
	2022		2021
Total gross revenues	$	14,391	$	15,186
Depreciation expense	(7,958)		(9,685)
Property operating	(2,412)		(2,345)
General and administrative	(558)		(566)
Gain on sale	56,576		—
Interest expense	(2,532)		(2,981)
Income from continuing operations	57,507		(391)
Provision for income taxes	(250)		(26)
Net income	$	57,257	$	(417)

(7)Debt

The Company had the following mortgages and notes payable outstanding as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020:~~2021:


		September 30, 2021		December 31, 2020			March 31, 2022		December 31, 2021
Mortgages and notes payable	Mortgages and notes payable	$	117,275	$	138,412	Mortgages and notes payable	$	81,650	$	84,429
Unamortized debt issuance costs	Unamortized debt issuance costs	(1,642)		(1,883)		Unamortized debt issuance costs	(1,265)		(1,337)
Mortgages and notes payable, net	Mortgages and notes payable, net	$	115,633	$	136,529	Mortgages and notes payable, net	$	80,385	$	83,092

Interest rates, including imputed rates on mortgages and notes payable, ranged from 3.5% to ~~5.4%, and 3.5% to 6.3%~~4.3%, at ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, respectively,~~2021 and all mortgages and notes payables mature between 2023 and ~~2032~~2031 as of ~~September 30, 2021.~~March 31, 2022. The weighted-average interest rate was ~~4.3% and 4.5%~~approximately 4.0% at ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, respectively.~~

On July 12, 2021, LCIF encumbered 2 of its properties with mortgage debt in the amount of $11,610. Subsequently, on July 12, 2021, certain operating partnership unitholders assumed the mortgages upon purchasing the properties. See note 4~~, Dispositions and Impairment~~.

~~Table of Contents~~2021.

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

The Company had the following ~~senior notes~~Senior Notes outstanding as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020:~~2021:


Issue Date	Issue Date	September 30, 2021		December 31, 2020		Interest Rate		Maturity Date	Issue Price		Issue Date	March 31, 2022		December 31, 2021		Interest Rate		Maturity Date	Issue Price
August 2021	August 2021	$	400,000	$	—	2.375	%	October 2031	99.758	%	August 2021	$	400,000	$	400,000	2.375	%	October 2031	99.758	%
August 2020	August 2020	400,000		400,000		2.70	%	September 2030	99.233	%	August 2020	400,000		400,000		2.70	%	September 2030	99.233	%
May 2014	May 2014	198,932		198,932		4.40	%	June 2024	99.883	%	May 2014	198,932		198,932		4.40	%	June 2024	99.883	%
June 2013		—		188,756		4.25	%	June 2023	99.026	%
		998,932		787,688								998,932		998,932
Unamortized debt discount	Unamortized debt discount	(3,760)		(3,491)							Unamortized debt discount	(3,547)		(3,655)
Unamortized debt issuance cost	Unamortized debt issuance cost	(7,582)		(4,922)							Unamortized debt issuance cost	(7,113)		(7,346)
Senior notes payable, net	Senior notes payable, net	$	987,590	$	779,275						Senior notes payable, net	$	988,272	$	987,931

Each series of the senior notes is unsecured and requires payment of interest semi-annually in arrears. The Company may redeem the notes at its option at any time prior to maturity in whole or in part by paying the principal amount of the notes being redeemed plus a make-whole premium.

~~In August~~

Table of Contents

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021 the Company issued $400,000 aggregate principal amount of 2.375% Senior Notes due 2031 (“2031 Senior Notes”) at an issuance price of 99.758% of the principal amount. The Company issued the 2031 Senior Notes at an initial discount of $968 which is being recognized as additional interest expense over the term of the 2031 Senior Notes.

During the three months ended September 30, 2021, the Company used a portion of the net proceeds from the offering of the 2031 Senior Notes to redeem the $188,756 aggregate principal balance of its outstanding 4.25% Senior Notes due 2023 (“2023 Senior Notes”). The consideration paid included a make-whole premium of $12,191(Unaudited and ~~$2,028 of accrued~~dollars in thousands, except share/unit and ~~unpaid interest. The Company recognized a $12,948 debt satisfaction loss related to the aggregate redemptions.~~per share/unit data)

In August 2020, the Company issued $400,000 aggregate principal amount of 2.7% Senior Notes due 2030 (“2030 Senior Notes”) at an issuance price of 99.233% of the principal amount. The Company issued the 2030 Senior Notes at an initial discount of $3,068 which is being recognized as additional interest expense over the term of the 2030 Senior Notes.

During the three months ended September 30, 2020, the Company used a portion of the net proceeds from the offering of the 2030 Senior Notes to repurchase $61,244 and $51,068 aggregate principal balance of its outstanding 2023 Senior Notes and 4.40% Senior Notes due 2024 (“2024 Senior Notes”), respectively, through a tender offer. The tender offer consideration included $9,477 in prepayment costs and fees and $1,024 of accrued interest. The Company recognized a $10,066 debt satisfaction loss related to the aggregate repurchases, which included a write-off of the proportionate amount of unamortized discount and debt issuance costs related to the 2023 Senior Notes and 2024 Senior Notes.

The Company has an unsecured credit agreement with KeyBank National Association, as agent. The maturity dates and interest rates as of ~~September 30, 2021,~~March 31, 2022, are as follows:


	Maturity Date	Current Interest Rate
$600,000 Revolving Credit Facility(1)	February 2023	LIBOR + 0.90%
$300,000 Term Loan(2)	January 2025	LIBOR + 1.00%

(1) Maturity date of the revolving credit facility can be extended to February 2024 at the Company's option. The interest rate ranges from LIBOR plus 0.775% to 1.45%. At ~~September 30, 2021,~~March 31, 2022, the Company had 0 borrowings outstanding and availability of $600,000, subject to covenant compliance.

(2) The LIBOR portion of the interest rate was swapped to obtain a current fixed rate of 2.732% per annum. The aggregate unamortized debt issuance costs for the term loan was ~~$1,680~~$1,428 and ~~$2,057~~$1,554 as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, respectively.

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

The Company was compliant with all applicable financial covenants contained in its corporate-level debt agreements at ~~September 30, 2021.~~March 31, 2022.

During 2007, the Company issued $200,000 original principal amount of Trust Preferred Securities. The Trust Preferred Securities, which are classified as debt, are due in 2037, are open for redemption at the Company's option and bear interest at a variable rate of three-month LIBOR plus 170 basis points through maturity. The interest rate at ~~September 30, 2021~~March 31, 2022 was ~~1.829%~~1.999%. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, there was $129,120 original principal amount of Trust Preferred Securities outstanding and ~~$1,550~~$1,500 and ~~$1,625,~~$1,525, respectively, of unamortized debt issuance costs.

Capitalized interest recorded during the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021 was $1,166 and ~~2020 was $2,124 and $1,112,~~$691, respectively.

(8) Derivatives and Hedging Activities

Risk Management Objective of Using Derivatives. The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the type, amount, sources, and duration of its debt funding and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company's derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company's known or expected cash receipts and its known or expected cash payments principally related to the Company's investments and borrowings.

Cash Flow Hedges of Interest Rate Risk. The Company's objectives in using interest rate derivatives are to add stability to interest expense, to manage its exposure to interest rate movements and therefore manage its cash outflows as it relates to the underlying debt instruments. To accomplish these objectives, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy relating to certain of its variable rate debt instruments. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount.

The ~~effective portion of~~ changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income (loss) and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. The ~~ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. The~~ Company did not incur any ineffectiveness during the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021.

Table of Contents

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and ~~2020.~~dollars in thousands, except share/unit and per share/unit data)

During July 2019, the Company entered into 4 interest rate swap agreements with its counterparties. The swaps were designated as cash flow hedges of the risk of variability attributable to changes in the LIBOR swap rates on its $300,000 LIBOR-indexed variable-rate unsecured term loan. Accordingly, changes in fair value of the swaps are recorded in other comprehensive income (loss) and reclassified to earnings as interest becomes receivable or payable. The swaps expire coterminous with the extended maturity of the term loan in January 2025. During the next 12 months, ~~ending September 30, 2022,~~ the Company estimates that an additional ~~$4,863~~$155 will be reclassified as ~~an increase~~a decrease to interest expense if the swaps remain outstanding.


Interest Rate Derivative	Number of Instruments	Notional
Interest Rate Swaps	4	$300,000

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

The table below presents the fair value of the Company's derivative financial instruments as well as their classification on the unaudited condensed consolidated balance sheets:

As of September 30, 2021 As of December 31, 2020
Balance Sheet Location Fair Value Balance Sheet Location Fair Value
Derivatives designated as hedging instruments
Interest Rate Swaps Accounts Payable and Other Liabilities $ (10,891) Accounts Payable and Other Liabilities $ (17,963)

As of March 31, 2022

As of December 31, 2021

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Derivatives designated as hedging instruments

Interest Rate Swaps

Other Assets

6,008

Other Liabilities

(6,258)

The table below presents the effect of the Company's derivative financial instruments on the unaudited condensed consolidated statements of operations for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~2021.


Derivatives in Cash Flow	Derivatives in Cash Flow	Amount of Gain (Loss) Recognized in OCI on Derivatives September 30,				Amount of Loss Reclassified from Accumulated OCI into Income (1) September 30,				Derivatives in Cash Flow	Amount of Gain Recognized in OCI on Derivatives March 31,				Amount of Loss Reclassified from Accumulated OCI into Income (1) March 31,
Hedging Relationships	Hedging Relationships	2021		2020		2021		2020		Hedging Relationships	2022		2021		2022		2021
Interest Rate Swaps	Interest Rate Swaps	$	3,381	$	(19,934)	$	3,691	$	2,175	Interest Rate Swaps	$	11,078	$	4,143	$	1,188	$	1,203

(1) Amounts reclassified from accumulated other comprehensive income (loss) to interest expense within the unaudited condensed consolidated statement of operations.

Total interest expense presented in the unaudited condensed consolidated statements of operations, in which includes the effects of cash flow hedges, ~~are recorded~~ was ~~$35,170~~$10,682 and ~~$42,610~~$11,486 for the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ respectively.

The Company's agreements with swap derivatives counterparties contain provisions whereby if the Company defaults on the underlying indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default of the swap derivative obligation. As of ~~September 30, 2021,~~March 31, 2022, the Company had not posted any collateral related to the agreements.

Table of Contents

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(9) Lease Accounting

Lessor

The ~~following is a summary of the Company's accounting for leases as of and during the nine months ended September 30, 2021 and 2020:~~

~~Lessor~~

~~Lexington’s~~Company’s lease portfolio as a lessor primarily includes general purpose, single-tenant net-leased ~~industrial and office~~ real estate assets. Most of the ~~Company’s~~Company’s leases require tenants to pay fixed annual rental payments that escalate on an annual basis and variable payments for other operating expenses, such as real estate taxes, insurance, common area maintenance ("CAM"), and utilities, that are based on the actual expenses incurred.

Certain leases allow for the tenant to renew the lease term upon expiration or earlier. Periods covered by a renewal option are included within the lease term only when renewals are deemed to be reasonably certain. Certain leases allow for the tenant to terminate the lease before the expiration of lease term and certain leases provide the tenant with the right to purchase the leased property at fair market value or a stipulated price upon expiration of the lease term or before.

Accounting guidance under Topic 842 requires the Company to make certain assumptions and judgments in applying the guidance, including determining whether an arrangement includes a lease and determining the lease term when the contract has renewal, purchase or early termination provisions.

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

The Company analyzes its accounts receivable, customer creditworthiness and current economic trends when evaluating the adequacy of the collectability of the lessee's total accounts receivable balance on a lease by lease basis. In addition, tenants in bankruptcy are analyzed and considerations are made in connection with the expected pre-petition and post-petition claims. If a lessee's accounts receivable balance is considered ~~uncollectable,~~uncollectible, the Company will write-off the receivable balances associated with the lease to rental revenue and cease to recognize lease income, including straight-line rent, unless cash is received. If the Company subsequently determines that it is probable it will collect substantially all of the lessee's remaining lease payments under the lease term; the Company will reinstate the straight-line balance adjusting for the amount related to the period when the lease was accounted for on a cash basis. During the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2022 and 2021, the Company ~~wrote~~did not write off aany deferred rent receivable ~~balance of $615,~~ as a reduction of rental ~~revenue, related to a tenant that dissolved and surrendered its leased premises in an industrial property located in the Columbus, Ohio market.~~revenue.

Certain tenants have been experiencing financial difficulties as a result of the ~~COVID-19 pandemic.~~current economic conditions. During the ~~nine~~three months ended September 30, 2020, the Company wrote off an aggregate deferred rent receivable balance of $1,383, as a reduction of rental revenue, related to tenants with rent collectability concerns. During the nine months ended September 30,March 31, 2022 and 2021, ~~and 2020,~~ the Company wrote off an aggregate of ~~$463~~$84 and ~~$177,~~$183, respectively, accounts receivable relating to certain tenants suffering from the current economic conditions.

The Company ~~determined~~elected that the lease and non-lease components in its leases are a single lease component, which is, therefore, being recognized as rental revenue in its unaudited condensed consolidated statements of operations. The primary non-lease service is included within rental revenue is CAM services provided as part of the ~~Company’s~~Company’s real estate leases. Topic 842 requires that the Company capitalize, as initial direct costs, only those costs that are incurred due to the execution of a lease. As of ~~September 30, 2020,~~March 31, 2022 and 2021, the Company ~~incurred $67 of~~did not incur any costs that were not incremental to the execution of leases, which are included in property operating expenses on its unaudited condensed consolidated statements of operations. The Company incurred no leasing costs that were not incremental for the execution of leases as of September 30, 2021.leases.

The Company manages the risk associated with the residual value of its leased properties by including contract clauses that make tenants responsible for surrendering the space in good condition upon lease termination, holding a diversified portfolio, and other activities. The Company does not have residual value guarantees on specific properties.

The following table presents the ~~Company’s~~Company’s classification of rental revenue for its operating leases for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 and ~~2020:~~2021:

Three Months Ended Nine Months Ended
Classification September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020
Fixed $ 71,357 $ 74,902 $ 213,929 $ 219,542
Variable(1)(2)
10,996 8,690 40,641 23,879
Total $ 82,353 $ 83,592 $ 254,570 $ 243,421


	Three Months Ended
Classification	March 31, 2022		March 31, 2021
Fixed	$	66,982	$	71,942
Variable(1)(2)	11,554		19,703
Total	$	78,536	$	91,645

Table of Contents

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(1) Primarily comprised of tenant reimbursements.

(2) Variable income contains termination income of ~~$14,105 and $662~~$10,941 for the ~~nine~~three months ended ~~September 30, 2021 and 2020, respectively.~~March 31, 2021. No termination fee revenue was recognized during the three months ended March 31, 2022. The 2021 termination fee income primarily related to a tenant that terminated its lease at the Company's Durham, New Hampshire industrial property.

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

Future fixed rental receipts for leases, assuming no new or re-negotiated leases as of ~~September 30, 2021~~March 31, 2022 were as follows:

2021 - remainder $ 68,554
2022 277,267
2023 277,523
2024 241,780
2025 211,975
2026 188,128
Thereafter 767,235
Total $ 2,032,462


Three months ending March 31, 2022	Total
2022 - remainder	$	194,736
2023	263,513
2024	233,837
2025	212,628
2026	194,096
2027	158,937
Thereafter	581,264
Total	$	1,839,011

~~Lessee~~The above minimum lease payments do not include reimbursements to be received from tenants for certain operating expenses and real estate taxes and do not include early termination payments provided for in certain leases, unless such payments are reasonably certain to be received.

Lessee

The Company, as lessee, has ground leases, corporate leases for office space, and office equipment leases. All leases were classified as operating leases as of ~~September 30, 2021.~~March 31, 2022. The leases have remaining lease terms of up to ~~42 years, some of which include options to extend the leases in 5 to 10-year increments for up to 52~~39 years. Renewal periods are included in the lease term only when renewal is deemed to be reasonably certain. The lease term also includes periods covered by an option to terminate the lease if the Company is reasonably certain not to exercise the termination option. The Company measures its lease payments by including fixed rental payments and variable rental payments that tie to an index or a rate, such as CPI. The Company recognizes lease expense for its operating leases on a straight-line basis over the lease term and variable lease expense not included in the lease payment measurement as incurred.

The accounting guidance under Topic 842 requires the Company to make certain assumptions and judgments in applying the guidance, including determining whether an arrangement includes a lease, determining the term of a lease when the contract has renewal or termination provisions and determining the discount rate.

The Company determines whether an arrangement is or includes a lease at contract inception by evaluating whether the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. If the Company has the right to obtain substantially all of the economic benefits from and can direct the use of, the identified asset for a period of time, the Company accounts for the contract as a lease.

The Company uses the information available at the lease commencement date to determine the discount rate for any new leases. The Company used a portfolio approach to determine its incremental borrowing rate. Lease contracts were grouped based on similar lease terms and economic environments in a manner in which the Company reasonably expects that the outcome from applying a portfolio approach does not differ materially from an individual lease approach. The Company estimated a collateralized discount rate for each portfolio of leases.

2019

Table of Contents

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

Supplemental information related to operating leases is as follows:


		Nine Months Ended					Three Months Ended
		September 30, 2021		September 30, 2020			March 31, 2022		March 31, 2021
Weighted-average remaining lease term	Weighted-average remaining lease term					Weighted-average remaining lease term
Operating leases (years)	Operating leases (years)	11.3		12.3		Operating leases (years)	9.5		11.5
Weighted-average discount rate	Weighted-average discount rate					Weighted-average discount rate
Operating leases	Operating leases	4.1	%	4.2	%	Operating leases	4.0	%	4.1	%

The components of lease expense for the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ were as follows:

Income Statement Classification Fixed Variable Total
2021:
Property operating $ 2,734 $ 2 $ 2,736
General and administrative 1,037 24 1,061
Total $ 3,771 $ 26 $ 3,797
2020:
Property operating $ 2,985 $ — $ 2,985
General and administrative 1,012 76 1,088
Total $ 3,997 $ 76 $ 4,073


Income Statement Classification	Fixed		Variable		Total
2022:
Property operating	$	886	$	—	$	886
General and administrative	377		35		412
Total	$	1,263	$	35	$	1,298

2021:
Property operating	$	912	$	—	$	912
General and administrative	336		33		369
Total	$	1,248	$	33	$	1,281

The Company recognized sublease income of ~~$2,569~~$830 and ~~$2,824~~$856 for the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ respectively.

The following table shows the Company's maturity analysis of its operating lease liabilities as of ~~September 30, 2021:~~March 31, 2022:

Operating Leases
2021 - remainder $ 1,192
2022 5,005
2023 5,155
2024 5,021
2025 5,021
2026 3,985
Thereafter 13,486
Total lease payments $ 38,865
Less: Imputed interest (8,756)
Present value of operating lease liabilities $ 30,109


	Operating Leases
2022 - remainder	$	3,706
2023	5,290
2024	5,199
2025	5,204
2026	4,174
2027	3,673
Thereafter	7,501
Total lease payments	$	34,747
Less: Imputed interest	(6,711)
Present value of operating lease liabilities	$	28,036

(10)Concentration of Risk

The Company seeks to reduce its operating and leasing risks through the geographic diversification of its properties, tenant industry diversification, avoidance of dependency on a single asset and the creditworthiness of its tenants. For the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ no single tenant represented greater than 10% of rental revenues.

Cash and cash equivalent balances at certain institutions may exceed insurable amounts. The Company believes it mitigates this risk by investing in or through major financial institutions.

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~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(11)Equity

Shareholders' Equity:

During the three months ended March 31, 2022 and 2021, the Company granted common shares to certain employees as follows:


	Three Months Ended March 31,
	2022		2021
Performance Shares:(1)
Shares granted:
Index - 1Q	282,720		297,636
Peer - 1Q	282,715		297,632
Grant date fair value per share:(2)
Index - 1Q	$	9.40	$	7.13
Peer - 1Q	$	8.78	$	6.23

Non-Vested Common Shares:(3)
Shares issued	295,230		304,060
Grant date fair value	$	4,304	$	3,080

(1) The shares vest based on the Company's total shareholder return growth after a three-year measurement period relative to an index and a group of peer companies. Dividends are not paid on these grants until earned. Once the performance criteria are met and the actual number of shares earned is determined, such shares vest immediately. During the three months ended March 31, 2022, all of the 552,121 performance shares issued in 2019 vested.

(2) The fair value of awards granted was determined at the grant date using a Monte Carlo simulation model.

(3) The shares vest ratably over a three-year service period.

At-The-Market Offering Program. The Company maintains an At-The-Market offering program ("ATM program") under which the Company can issue common shares, including through forward sales contracts. ~~The following table summarizes common share issuances under~~

During the ~~ATM program for the nine~~three months ended ~~September 30, 2021 and September 30, 2020, respectively:~~

Nine Months Ended September 30, 2021
Shares Sold Net Proceeds
2021 ATM Issuances 1,052,800 $13,574
Nine Months Ended September 30, 2020
Shares Sold Net Proceeds
2020 ATM Issuances 5,950,882 $61,032

~~During the nine months ended September 30, 2021,~~March 31, 2022, the Company ~~settled 3,875,751~~issued 3,649,023 common shares previously sold on a forward basis in the first quarter of 2021 on the maturity date of the contracts and received ~~$41,933~~$38,492 of net proceeds. ~~There were no forward share settlements during the nine months ended September 30, 2020.~~

As of September 30, 2021, an aggregate of 4,763,989 common shares were sold in forward sales contracts that have not been settled and had an aggregate settlement price of $50,721, which is subject to adjustment in accordance with the forward sales contracts. The Company expects to settle the forward sales contracts by the maturity dates in February 2022.

~~In February~~During 2021, the Company amended the terms of its ATM offering program, under which the Company may, from time to time, sell up to $350,000 of common shares over the term of the program. As of ~~September 30, 2021,~~March 31, 2022, common shares with an aggregate value of $294,985 remain available for issuance under the ATM program.

Underwritten equity offerings. ~~In May~~During 2021, the Company entered into forward sales contracts for the sale of 16,000,000 common shares at a public offering price of $12.11 per common share in an underwritten equity offering that have not yet settled. ~~Subject~~The forward sales contracts mature in May 2022, subject to the Company's rights to elect cash or net share ~~settlement, the Company expects to settle the forward sales contracts by the maturity date in May 2022.~~settlement. As of ~~September 30, 2021,~~March 31, 2022, the forward sales contracts had an aggregate settlement price of ~~$189,777,~~$185,309, which is subject to adjustment in accordance with the forward sales contracts.

During 2020, the Company issued 17,250,000 common shares at a public offering price of $9.60 per common share in an underwritten equity offering and generated net proceeds of approximately $164,000. The proceeds were used for general corporate purposes, including acquisitions, and pending the application of the proceeds were used to pay down all of the then outstanding balance under the Company's revolving credit facility.

~~Nonemployee~~ Stock Based Compensation. During the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ the Company issued ~~38,803~~13,304 and ~~35,880,~~11,850, respectively, of fully vested common shares to non-management members of the Company's Board of Trustees with a fair value of ~~$437~~$232 and ~~$375,~~$125, respectively.

2221

Table of Contents

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

Share Repurchase Program. In July 2015, the Company's Board of Trustees authorized the repurchase of up to 10,000,000 common shares and increased this authorization by 10,000,000 in 2018. This share repurchase program has no expiration date. ~~During the nine months ended September 30, 2020, the Company repurchased and retired 1,329,940 common shares at an average price of $8.28 per common share under the share repurchase program.~~ There were no common shares repurchased during the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021. As of ~~September 30, 2021,~~March 31, 2022, 8,976,315 common shares remain available for repurchase under this authorization. The Company records a liability for repurchases that have not yet been settled as of the period end.

Series C Preferred Stock. The Company had 1,935,400 shares of Series C Cumulative Convertible Preferred Stock (“(“Series C ~~Preferred”~~Preferred”) outstanding at ~~September 30, 2021.~~March 31, 2022. The shares have a dividend of $3.25 per share per annum, have a liquidation preference of $96,770, and the Company, if certain common share prices are achieved, can force conversion into common shares of the Company. As of ~~September 30, 2021,~~March 31, 2022, each share was convertible into 2.4339 common shares. This conversion ratio may increase over time if the Company's common share dividend exceeds certain quarterly thresholds.

If certain fundamental changes occur, holders may require the Company, in certain circumstances, to repurchase all or part of their shares of Series C Preferred. In addition, upon the occurrence of certain fundamental changes, the Company will, under certain circumstances, increase the conversion rate by a number of additional common shares or, in lieu thereof, may in certain circumstances elect to adjust the conversion rate upon the shares of Series C Preferred becoming convertible into shares of the public acquiring or surviving company.

The Company may, at the Company's option, cause shares of Series C Preferred to be automatically converted into that number of common shares that are issuable at the then prevailing conversion rate. The Company may exercise its conversion right only if, at certain times, the closing price of the Company's common shares equals or exceeds 125% of the then prevailing conversion price of the Series C Preferred.

Holders of shares of Series C Preferred generally have no voting rights, but will have limited voting rights if the Company fails to pay dividends for six or more quarters and under certain other circumstances. Upon conversion, the Company may choose to deliver the conversion value to investors in cash, common shares, or a combination of cash and common shares.

A summary of the changes in accumulated other comprehensive income (loss) related to the Company's cash flow hedges is as follows:


		Nine Months Ended September 30,					Three Months Ended March 31,
		2021		2020			2022		2021
Balance at beginning of period	Balance at beginning of period	$	(17,963)	$	(1,928)	Balance at beginning of period	$	(6,258)	$	(17,963)
Other comprehensive gain (loss) before reclassifications		3,381		(19,934)
Other comprehensive income before reclassifications						Other comprehensive income before reclassifications	11,078		4,143
Amounts of loss reclassified from accumulated other comprehensive income to interest expense	Amounts of loss reclassified from accumulated other comprehensive income to interest expense	3,691		2,175		Amounts of loss reclassified from accumulated other comprehensive income to interest expense	1,188		1,203
Balance at end of period	Balance at end of period	$	(10,891)	$	(19,687)	Balance at end of period	$	6,008	$	(12,617)

Noncontrolling Interests. In conjunction with several of the Company's acquisitions in prior years, sellers were issued LCIF (“OP units”) as a form of consideration. All OP units, other than OP units owned by the Company, are redeemable for common shares at certain times, at the option of the holders, and are generally not otherwise mandatorily redeemable by the Company. The OP units are classified as a component of permanent equity as the Company has determined that the OP units are not redeemable securities as defined by GAAP. Each OP unit is currently redeemable at the holder's option for approximately 1.13 common shares, subject to future adjustments.

~~During the nine months ended September 30, 2021, LCIF redeemed and cancelled 1,598,906 OP units in connection with the disposition of 3 properties.~~ As of ~~September 30, 2021,~~March 31, 2022, there were approximately ~~824,000~~769,000 OP units outstanding other than OP units owned by the Company. All OP units receive distributions in accordance with the LCIF partnership agreement. To the extent that the Company's dividend per common share is less than the stated distribution per OP unit per the LCIF partnership agreement, the distributions per OP unit are reduced by the percentage reduction in the Company's dividend per common share. No OP units have a liquidation preference.

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~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

The following discloses the effects of changes in the Company's ownership interests in its noncontrolling interests:


		Net Income Attributable to Shareholders and Transfers from Noncontrolling Interests					Net Income Attributable to Shareholders and Transfers from Noncontrolling Interests
		Nine Months Ended September 30,					Three Months Ended March 31,
		2021		2020			2022		2021
Net income attributable to Lexington Realty Trust shareholders		$	120,358	$	78,924
Net income attributable to LXP Industrial Trust shareholders						Net income attributable to LXP Industrial Trust shareholders	$	10,622	$	41,042
Transfers from noncontrolling interests:	Transfers from noncontrolling interests:					Transfers from noncontrolling interests:
Increase in additional paid-in-capital for reallocation of noncontrolling interests		435		—

Increase in additional paid-in-capital for redemption of noncontrolling OP units	Increase in additional paid-in-capital for redemption of noncontrolling OP units	670		632		Increase in additional paid-in-capital for redemption of noncontrolling OP units	36		311
Change from net income attributable to shareholders and transfers from noncontrolling interests	Change from net income attributable to shareholders and transfers from noncontrolling interests	$	121,463	$	79,556	Change from net income attributable to shareholders and transfers from noncontrolling interests	$	10,658	$	41,353

(12)Related Party Transactions

There were no related party transactions other than those disclosed elsewhere in this Quarterly Report and the audited consolidated financial statements in the Annual Report.

(13)Commitments and Contingencies

In addition to the commitments and contingencies disclosed elsewhere, the Company has the following commitments and contingencies.

The Company is obligated under certain tenant leases, including its proportionate share for leases for non-consolidated entities, to fund the expansion of the underlying leased properties. The Company, under certain circumstances, may guarantee to tenants the completion of base building improvements and the payment of tenant improvement allowances and lease commissions on behalf of its subsidiaries.

As of ~~September 30, 2021,~~March 31, 2022, the Company ~~has committed to develop 6~~had 5 ongoing consolidated development projects and expects to incur approximately ~~$99,776, $153,024~~$229,840 and ~~$38,675~~$13,929 in ~~2021,~~the remainder of 2022 and 2023, respectively, excluding noncontrolling interests' share, to substantially complete the construction of the projects. ~~The remaining~~As of March 31, 2022, the Company had 2 ~~development projects are owned by~~consolidated and 2 non-consolidated joint ~~ventures. Due to the early stage of development of each non-consolidated project and the uncertainty of construction schedules at such stage, the~~ventures that own land parcels held for development. The Company is unable to estimate the timing of ~~the~~any required ~~fundings~~funding for the ~~non-consolidated~~potential development ~~projects.~~projects on these parcels.

The Company and LCIF are parties to a funding agreement under which the Company may be required to fund distributions made on account of LCIF's OP units. Pursuant to the funding agreement, the parties agreed that, if LCIF does not have sufficient cash available to make a quarterly distribution to its limited partners in an amount in accordance with the partnership agreement, ~~Lexington~~LXP will fund the shortfall. Payments under the agreement will be made in the form of loans to LCIF and will bear interest at prevailing rates as determined by the Company in its discretion but, no less than the applicable federal rate. LCIF's right to receive these loans will expire if no OP units remain outstanding and all such loans are repaid. No amounts have been advanced under this agreement.

From time to time, the Company is directly or indirectly involved in legal proceedings arising in the ordinary course of business. Management believes, based on currently available information, and after consultation with legal counsel, that although the outcomes of those normal course proceedings are uncertain, the results of such proceedings, in the aggregate, will not have a material adverse effect on the Company's business, financial condition and results of operations.

(14)Supplemental Disclosure of Statement of Cash Flow Information

In addition to disclosures discussed elsewhere, during the three months ended March 31, 2022 and 2021, the Company paid $9,261 and $10,480, respectively, for interest and $36 and $295, respectively, for income taxes.

Table of Contents

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

~~(14)Supplemental Disclosure of Statement of Cash Flow Information~~

~~In addition to disclosures discussed elsewhere, during~~During the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ the Company ~~paid $35,515~~had $34,636 and ~~$34,818,~~$9,935 respectively, ~~for interest and $1,273 and $1,525, respectively, for income taxes.~~of accrued non-cash assets in investments in real estate under construction.

~~As a result of~~During the ~~foreclosure of 2 office properties located in South Carolina and Kansas, during the nine~~three months ended ~~September 30, 2020, there was a non-cash change of $38,942 and $14,188 in mortgages and notes payable, net, and real estate, net, respectively.~~

~~During~~March 31, 2021, the nine months ended September 30, 2021 and 2020, the Company exercised extension options on leases that resulted in a non-cash increase of $438 and $719, respectively, to the related operating lease liability and right of use asset.

During the nine months ended September 30, 2021, LCIF disposed of 3 real estate assets. The consideration included the redemption of OP units valued at $22,305 and the assumption of the aggregate related non-recourse mortgage debt of $11,610.

~~The~~ acquisition of the RR Ocala 44, LLC joint venture included a $489 non-cash increase to investments in real estate under construction and the noncontrolling interest because a member of the joint venture made a non-cash contribution of the land in exchange for its ownership interest in the joint venture.

(15)Subsequent Events

Subsequent to ~~September 30, 2021,~~March 31, 2022, the Company:

••acquired ~~3 industrial properties~~a warehouse/distribution facility in the Phoenix, Arizona market for ~~an aggregate~~a cost of approximately ~~$76,400; and,~~$59,000;

••borrowed $80,000 on the revolving credit facility, net;

•commenced development of 2 warehouse/distribution facilities in the Central Florida market;

•disposed of 23 properties for aggregate gross proceeds of approximately ~~$25,400.~~$55,000; and

•repurchased 1,238,427 common shares at an average price of $13.41 per common share under the share repurchase program.

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Table of Contents

ITEM 2. ~~MANAGEMENT’S~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

Introduction

When we use the terms ~~“the~~ the “Company,~~” “we,” “us”~~” the “Trust,” “LXP,” “we,” “our,” and ~~“our,”~~“us,” we ~~mean Lexington Realty~~refer collectively to LXP Industrial Trust and its consolidated subsidiaries. All of the Company's interests are held, and all of the property operating activities are conducted through special purposes entities, ~~owned by us, including non-consolidated~~which we refer to as property owner subsidiaries or lender subsidiaries and are separate and distinct legal entities, ~~except where it is clear that the term means only Lexington Realty Trust.~~but in some instances are consolidated for financial statement purposes and/or disregarded for income tax purposes. References herein to ‘‘‘‘this Quarterly ~~Report”~~Report” are to this Quarterly Report on Form 10-Q for the three ~~and nine~~ months ended ~~September 30, 2021.~~March 31, 2022. The results of operations contained herein for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ are not necessarily indicative of the results that may be expected for a full year.

When we use the term “REIT,” we mean real estate investment trust. All references to 2022 and 2021, refer to the periods ending March 31, 2022 and 2021, respectively and our fiscal year ended December 31, 2021.

When we use the term “GAAP,” we mean United States generally accepted accounting principles in effect from time to time.

When we use the term “common shares,” we mean our shares of beneficial interest par value $0.0001, classified as common stock. When we use the term “Series C Preferred Shares,” we mean our beneficial interest classified as 6.50% Series C Cumulative Convertible Preferred Stock.

When we use the term “base rent,” we mean GAAP rental revenue and ancillary income, excluding billed tenant reimbursements and lease termination income.

The following is a discussion and analysis of the unaudited condensed consolidated financial condition and results of operations of ~~Lexington Realty~~LXP Industrial Trust for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ and significant factors that could affect its prospective financial condition and results of operations. This discussion should be read together with the accompanying unaudited condensed consolidated financial statements of the Company included herein and notes thereto and with the consolidated financial statements and notes thereto included in the Company's most recent Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission, or SEC, on February ~~18, 2021,~~24, 2022, which we refer to as the Annual Report. Historical results may not be indicative of future performance.

Forward-Looking Statements. This Quarterly Report, together with other statements and information publicly disseminated by us, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, ~~which we refer to as~~or the Exchange Act. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and include this statement for purposes of complying with these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, are generally identifiable by use of the words ~~“believes,” “expects,” “intends,” “anticipates,” “estimates,” “projects,” “may,” “plans,” “predicts,” “will,” “will~~“believes,” “expects,” “intends,” “anticipates,” “estimates,” “projects,” “may,” “plans,” “predicts,” “will,” “will likely ~~result”~~result” or similar expressions. Readers should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could materially affect actual results, performances or achievements. In particular, among the factors that could cause actual results, performances or achievements to differ materially from current expectations, strategies or plans include, among others, ~~any~~those risks discussed below in ~~“Management's~~“Management's Discussion and Analysis of Financial Condition and Results of Operations,”” and under the headings ~~“Risk Factors”~~“Risk Factors” in this Quarterly Report and ~~“Risk Factors”~~under “Risk Factors” in Part I, Item A and ~~“Management's~~“Management's Discussion and Analysis of Financial Condition and Results of ~~Operations”~~Operations” in Part II, Item 7 of the Annual Report and other periodic reports filed by the Company with the SEC. Except as required by law, we undertake no obligation to publicly release any revisions to these forward-looking statements which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Accordingly, there is no assurance that our expectations will be realized.

Overview

~~COVID-19 Impact.~~ OnAs of March ~~11, 2020, the World Health Organization declared COVID-19 a pandemic,~~31, 2022, we had equity ownership interests in approximately 123 consolidated real estate properties, located in 23 states and oncontaining an aggregate of approximately 55.6 million square feet of space, approximately 98.9% of which was leased.

Since December 31, 2015 through March ~~13, 2020 the United States declared a national emergency with respect~~31, 2022, we transitioned our portfolio from approximately 16% warehouse/distribution assets to ~~COVID-19. Our management continues to monitor events~~approximately 98% warehouse/distribution assets. As of March 31, 2022, our portfolio consisted of 111 warehouse/distribution facilities and ~~is taking steps to mitigate the potential impact and risks to us.~~

Related supply chain disruptions have caused delays in receiving, and increased the costs of, building materials. We do not currently believe such disruptions will have a material impact on our financial condition.

~~We remain unable to estimate the long-term impacts COVID-19 will have on our financial condition.~~

12 other properties.

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~~Third~~On February 8, 2022, we announced that our Board of Trustees initiated a review of our strategic alternatives. On April 8, 2022, we announced that our Board of Trustees suspended the review of strategic alternatives.

First Quarter ~~2021~~2022 Transaction Summary.

The following summarizes our significant transactions during the three months ended ~~September 30, 2021.~~March 31, 2022.

Leasing Activity:

During the ~~third~~first quarter of ~~2021,~~2022, we entered into new leases and lease extensions encompassing ~~2.6~~2.3 million square feet. The average fixed rent on these extended leases was ~~$5.07~~$5.68 per square foot compared to the average fixed rent on these leases before extension of ~~$4.78~~$5.04 per square foot. The weighted-average cost of tenant improvements and lease commissions was ~~$0.45~~$0.25 per square foot for extended leases and ~~$2.67~~$8.83 per square foot for new leases.

~~Investments:~~

•~~Acquired five industrial properties for an aggregate cost of $134.8 million.~~

•~~We also invested an aggregate of $57.1 million in six consolidated development projects, which amount excludes our joint venture partners' share.~~Investments:

During the three months ended March 31, 2022, we acquired the following warehouse/distribution assets:


Market	Square Feet	Initial Capitalized Cost (millions)		Date Acquired	Approximate Lease Term (years)	% Leased at Acquisition
Cincinnati/Dayton, OH(1)	232,500	$	23.4	February 2022	N/A	—	%
Cincinnati/Dayton, OH	544,320	48.6		February 2022	10	100	%
	776,820	$	72.0

(1) Subsequent to acquisition, property was fully leased for approximately nine years.

Capital Recycling:

••Disposed of our ~~interests~~interest in ~~three~~one consolidated land parcel for a disposition price of $0.3 million.

•NNN Office JV L.P. disposed of two properties for an aggregate gross disposition price of ~~$35.4~~$168.5 million and satisfied an aggregate of $109.0 million of non-recourse variable-rate debt. We own 20% of the joint venture and we received aggregate proceeds of $11.5 million.

~~Debt:~~

•~~Repaid $215.0 million on our revolving credit facility.~~Equity:

•~~Issued $400.0 million aggregate principal amount of 2.375% Senior Notes due 2031 ("2031 Senior Notes") at an issuance price of 99.758% of the principal amount.~~

•~~Repurchased $188.8 million aggregate principal balance of our outstanding 4.25% Senior Notes due 2023 ("2023 Senior Notes").~~

•~~Satisfied a $10.6 million non-recourse mortgage loan encumbering our Whippany, New Jersey office property.~~

~~Equity:~~

•~~Issued 1.1 million common shares under our At-the-Market offering program and generated net proceeds of $13.9 million.~~

••Settled ~~3.9~~3.6 million common shares previously sold on a forward basis for net proceeds of ~~$41.9~~$38.5 million.

~~Table of Contents~~Development Activity:

~~Acquisitions/Disposition Activity:~~

~~During the nine months ended September 30, 2021, we acquired/completed the following warehouse/distribution assets, inclusive of the acquisitions referenced above:~~

Market (1)
Square Feet Initial Capitalized Cost
(millions) Date Acquired/Completed
Approximate Lease Term
(years)(2)
% Leased at Acquisition
Indianapolis, IN 149,072 $ 14.3 January 2021 4 100 %
Indianapolis, IN 149,072 14.1 January 2021 6 100 %
Central Florida 222,134 22.4 January 2021 10 53 %
Columbus, OH(3)
320,190 19.5 March 2021 3 100 %
Houston, TX 233,190 28.3 May 2021 7 100 %
Houston, TX 402,648 37.7 May 2021 6 100 %
Houston, TX 102,863 11.5 May 2021 3 100 %
Cincinnati/Dayton, OH 194,936 18.7 June 2021 2 100 %
Central Florida 510,484 48.6 June 2021 N/A — %
Greenville-Spartanburg, SC 396,073 36.9 June 2021 4 100 %
Greenville-Spartanburg, SC 210,820 23.8 June 2021 7 62 %
Greenville-Spartanburg, SC 275,400 29.4 July 2021 8 100 %
Greenville-Spartanburg, SC 235,600 26.1 July 2021 9 100 %
Greenville-Spartanburg, SC(4)
195,000 18.4 July 2021 N/A — %
Greenville-Spartanburg, SC 327,360 31.6 July 2021 5 100 %
Columbus, OH 292,730 29.3 August 2021 8 100 %
4,217,572 $ 410.6

~~(1) Land parcel in Hebron, OH was also purchased for a total investment of $0.4 million.~~

~~(2) Represents the lease term of the primary tenant.~~

~~(3) Development project substantially completed and placed into service.~~

~~(4) Subsequent to acquisition, property fully leased for 5.5 years.~~

~~During the nine months ended September 30, 2021, we disposed of ten properties, inclusive of the dispositions reference above, for an aggregate gross disposition price of $218.8 million~~

~~Development Activity:~~

As of ~~September 30, 2021,~~March 31, 2022, we had ~~six~~five consolidated development projects in process with an aggregate estimated total cost of ~~$484.0~~$466.4 million. We anticipate our remaining funding obligation to substantially complete the construction of these ~~six~~five projects, exclusive of our joint venture partners' share, to be approximately ~~$291.5~~$243.8 million.

However, the risks associated with development, including supply chain issues, could adversely impact our estimates.

Critical Accounting Estimates

In preparing the consolidated financial statements we have made estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Accounting estimates are deemed critical if they involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results of operations. Below is a summary of the critical accounting estimates used in the preparation of our unaudited condensed consolidated financial statements. A summary of our significant accounting policies which are important to the portrayal of our financial condition and results of operations is set forth in (1) Note 2 to our audited consolidated financial statements, which are included in “Financial Statements and Supplementary Data” in Part II, Item 8 of the Annual Report and (2) Note 2 to our unaudited condensed consolidated financial statements contained in this Quarterly Report.

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~~Critical~~Acquisition of Real Estate. Primarily all of our acquisitions of real estate assets and liabilities are accounted for as asset acquisitions. As such, the purchase prices of acquired tangible and intangible assets and liabilities are recorded and allocated at fair value on a relative basis. The recorded allocations of tangible assets are based on the “as-if-vacant” value using estimated cash flow projections of the properties acquired which incorporates discount, capitalization and interest rates as well as available comparable market information. Allocations of intangible assets includes management’s estimates of current market rents and leasing costs.

We use considerable judgement in our estimates of cash flow projections, discount, capitalization and interest rates, fair market lease rates, carrying costs during hypothetical expected lease-up periods and costs to execute similar leases. While our methodology for purchase price allocation did not change during the three months ended March 31, 2022, the real estate market is fluid and our assumptions are based on information currently available in the market at the time of acquisition. Significant increases or decreases in these key estimates, particularly with regards to cash flow projections and discount and capitalization rates, would result in a significantly lower or higher fair value measurement of the real estate assets being acquired.

Revenue Recognition. We enter into agreements with tenants that convey the right to control the use of identified space at our properties in exchange for rental revenue. These agreements meet the criteria for recognition as leases under Accounting ~~Policies~~Standards Codification (“ASC”) 842, Leases. We recognize lease revenue on a straight-line basis over the term of the lease unless another systematic and rational basis is more representative of the time pattern in which the use benefit is derived from the leased property. We commence revenue recognition when possession or control of the space is turned over to the tenant.

~~Management's discussion~~We evaluate the collectability of our rental payments and ~~analysis~~recognize revenue on a cash basis when we believe it is no longer probable that we will receive substantially all of the remaining lease payments. Management exercises judgment in assessing collectability of tenant receivables and considers payment history, current credit status, publicly available information about the financial condition of the tenant and ~~results~~other factors. Our assessment of ~~operations is based upon~~the collectability of tenant receivables can have a significant impact on the rental revenue recognized in our unaudited condensed consolidated ~~financial~~ statements ~~which have been prepared in accordance with GAAP. In preparing~~of operations.

Impairment of Real Estate. We record impairments of our ~~unaudited condensed consolidated financial statements in accordance with GAAP and pursuant to~~real estate assets classified as held for use when triggering events dictate that an asset may be impaired. An impairment is recorded when the ~~rules and regulations~~carrying amount of the ~~SEC, we make assumptions, judgments~~asset exceeds the sum of its undiscounted future operating and ~~estimates that affect~~residual cash flows. The impairment recorded is the ~~reported amounts~~difference between estimated fair value of ~~assets, liabilities, revenue,~~the asset and ~~expenses, and related disclosures of contingent assets and liabilities.~~the carrying amount. We base our assumptions, judgments and estimates on historical experience and various other factors that we believe to be reasonable under the circumstances, including the recent economic uncertainty primarily caused by COVID-19. Actual results could differ materially from these estimates under different assumptions or conditions. On a regular basis, we evaluate our assumptions, judgments and estimates. Certainrecord impairments of our ~~accounting policies~~real estate assets classified as held for sale at the lower of the carrying amount or estimated fair value using the estimated or contracted sales price less costs to sell. Any real estate assets recorded at fair value on a non-recurring basis as a result of our impairment analysis are ~~discussed under (1) Item 7, “Management's Discussion~~valued using unobservable local and ~~Analysis~~national industry market data such as comparable sales, appraisals, brokers’ opinions of ~~Financial Condition and Results~~value and/or terms of ~~Operations”~~definitive sales contracts. Additionally, the analysis includes considerable judgement in our ~~Annual Report, (2) note 2~~estimates of hold periods, projected cash flows and discount and capitalization rates. Significant increases or decreases in any of these inputs, particularly with regards to cash flow projections and discount and capitalization rates, would result in a significantly lower or higher fair value measurement of the real estate assets being assessed.

We will record an impairment charge related to our ~~consolidated financial statements contained~~investments, including investments in non-consolidated entities, if we determine the fair value of the investments are less than their carrying value and such impairment is other-than-temporary. We evaluate whether events or changes in circumstances indicate that the carrying amount of our ~~Annual Report~~investments may not be recoverable. Our evaluation of changes in economic or operating conditions and ~~(3) note 1 to our unaudited condensed consolidated financial statements contained in this Quarterly Report.~~whether an impairment is other-than-temporary may include developing estimates of fair value, forecasted cash flows or operating income before depreciation and amortization. We ~~believe there have been no material changes to the items that we disclosed~~estimate undiscounted cash flows and fair value using observable and unobservable data such as ~~our critical accounting policies under Item 7, “Management's Discussion~~operating income, hold periods, estimated capitalization and ~~Analysis of Financial Condition~~discount rates, or relevant market multiples, leasing prospects and ~~Results of Operations” in our Annual Report.~~local market information and whether certain impairments are other-than-temporary.

Liquidity and Capital Resources

Cash Flows. We believe that cash flows from operations will continue to provide adequate capital to fund our operating and administrative expenses, regular debt service obligations and all dividend payments in accordance with applicable REIT requirements in both the short-term and long-term. However, our cash flow from operations may be negatively affected in the near term if we grant tenant rent relief packages or experience tenant defaults as a result of the effects of ~~COVID-19.~~the current economic conditions. In addition, we anticipate that cash on hand, borrowings under our unsecured revolving credit facility, capital recycling proceeds, issuances of equity, mortgage proceeds and other debt, as well as other available alternatives, will provide the necessary capital required by our business.

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At ~~September 30, 2021,~~March 31, 2022, our property owner subsidiaries do not have mortgage maturities with balloon payments due until ~~2025.~~2031. In addition, certain of our subsidiaries are obligated to fund the construction of our development projects and we sometimes guaranty these obligations. We believe our property owner subsidiaries have sufficient sources of liquidity to meet these obligations through future cash flows from operations, the credit markets and, if determined appropriate by us, a capital contribution from us from either cash on hand ($~~150.1~~49.1 million at ~~September 30, 2021)~~March 31, 2022), property sale proceeds, borrowing capacity under our unsecured revolving credit facility ($600.0 million at ~~September 30, 2021,~~March 31, 2022, subject to covenant compliance), which expires in 2023, but can be extended by us to 2024, unsettled forward common share sale contracts, and future cash flows from operations.

Cash flows from operations were ~~$167.4~~$42.1 million for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 as compared to ~~$152.5~~$57.4 million for the ~~nine~~three months ended ~~September 30, 2020.~~March 31, 2021. The ~~increase~~decrease was primarily related to property sales and a decrease in termination fee income, partially offset by the impact of cash flow generated from acquiring ~~properties and termination fee income, partially offset by property sales and vacancies.~~properties. The underlying drivers that impact our working capital, and therefore cash flows from operations, are the timing of collection of rents, including reimbursements from tenants, payment of interest on mortgage debt and payment of operating and general and administrative costs. We believe the net-lease structure of the leases encumbering a majority of the properties in which we have an interest mitigates the risks of the timing of cash flows from operations since the payment and timing of operating costs related to the properties are generally borne directly by the tenant. The collection and timing of tenant rents are closely monitored by management as part of our cash management program.

Net cash used in investing activities totaled ~~$344.1~~$152.5 million and ~~$370.6~~$24.9 million during the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ respectively. Cash used in investing activities related primarily to acquisitions of real estate, investments in real estate under construction, capital expenditures, lease costs, investments in non-consolidated entities ~~investment in a note receivable~~ and changes in real estate deposits, net. Cash provided by investing activities primarily related to net proceeds received from the disposition of real estate and distributions from non-consolidated entities.

Net cash ~~provided by~~used in financing activities totaled ~~$147.7~~$31.4 million and ~~$378.5~~$41.7 million during the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ respectively. Cash provided by financing activities primarily related to the ~~issuance of the 2031 Senior Notes, revolving credit facility borrowings, mortgage proceeds,~~ issuances of common shares and cash contributions from noncontrolling interests. Cash used in financing activities primarily related to the ~~redemption~~purchase of ~~the 2023 Senior Notes,~~a noncontrolling interest and dividend and debt service payments.

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Common Share Issuances:

At-The-Market Offering Program. We maintain an At-The-Market offering program ("ATM program") under which the Company can issue common shares, including through forward sales contracts. ~~The following table summarizes common share issuances under the ATM program for the nine months ended September 30, 2021 and September 30, 2020:~~






	~~Nine Months Ended September 30, 2021~~
	~~Shares Sold~~	~~Net Proceeds~~
~~2021 ATM Issuances~~	~~1,052,800~~	~~$13.6 million~~

	~~Nine Months Ended September 30, 2020~~
	~~Shares Sold~~	~~Net Proceeds~~
~~2020 ATM Issuances~~	~~5,950,882~~	~~$61.0 million~~

During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, we settled ~~3,875,751~~3.6 million common shares previously sold in 2021 on a forward basis on the maturity date of the ~~contract~~contracts and received ~~$41.9~~$38.5 million of net proceeds. There were no forward share settlements during the ~~nine~~three months ended ~~September 30, 2020.~~March 31, 2021. All forward sales contracts under our ATM program have been settled as of March 31, 2022.

As of September 30, 2021, an aggregate of 4,763,989 common shares were sold in forward sales contracts that have not been settled and had an aggregate settlement price of $50.7 million, which is subject to adjustment in accordance with the forward sales contracts.

In February 2021, we amended the terms of our ATM offering program, under which we may, from time to time, sell up to $350.0 million common shares over the term of the program. As of ~~September 30, 2021,~~March 31, 2022, common shares with an aggregate value of $295.0 million remain available for issuance under the ATM program.

Underwritten Equity Offerings. In May 2021, we entered into forward sales contracts for the sale of 16,000,000 common shares at a public offering price of $12.11 per common share in an underwritten equity offering that have not yet settled. ~~Subject~~The forward sales contracts mature in May 2022, subject to our ~~rights~~right to elect cash or net share ~~settlement, we expect to settle the forward sales contracts by the maturity date of May 2022.~~settlement. As of ~~September 30, 2021,~~March 31, 2022, the forward sales contracts had an aggregate settlement price of ~~$189.8~~$185.3 million, which is subject to adjustment in accordance with the forward sales contracts.

During 2020, we issued 17,250,000 common shares at a public offering price of $9.60 per common share in an underwritten equity offering and generated net proceeds of approximately $164.0 million. The proceeds were used for general corporate purposes, including acquisitions, and pending the application of the proceeds were used to pay down all of the then outstanding balance under our revolving credit facility.

The volatility in the capital markets primarily resulting from the effects of the ~~COVID-19 pandemic~~current economic conditions may negatively affect our ability to access the capital markets through our ATM program and other offerings.

Dividends. Dividends paid to our common and preferred shareholders were ~~$95.9~~$36.8 million and ~~$88.0~~$33.5 million in the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ respectively.

We declared a quarterly dividend of ~~$0.1075~~$0.12 per common share during the three months ended ~~September 30, 2021,~~March 31, 2022, which is an increase from the ~~$0.105~~$0.1075 per common share quarterly dividend declared during the three months ended ~~September 30, 2020.~~March 31, 2021.

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UPREIT Structure. As of ~~September 30, 2021, 0.8 million~~March 31, 2022, 769,000 units of limited partner interests, or OP units, in our operating partnership, LCIF, were outstanding not including OP units held by us. Assuming all outstanding OP units not held by us were redeemed on such date, the estimated fair value of such OP units was ~~$11.8~~$13.6 million based on our closing price of ~~$12.75~~$15.70 per common share as of ~~September 30, 2021~~March 31, 2022 and a redemption factor of approximately 1.13 common shares per OP unit.

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Financings. The following senior notes were outstanding as of ~~September 30, 2021:~~March 31, 2022:
Issue Date Face Amount ($000) Interest Rate Maturity Date Issue Price
August 2021 $ 400,000 2.375 % October 2031 99.758 %
August 2020 400,000 2.70 % September 2030 99.233 %
May 2014 198,932 4.40 % June 2024 99.883 %
$ 998,932


Issue Date	Face Amount ($000)		Interest Rate		Maturity Date	Issue Price
August 2021	$	400,000	2.375	%	October 2031	99.758	%
August 2020	400,000		2.70	%	September 2030	99.233	%
May 2014	198,932		4.40	%	June 2024	99.883	%
	$	998,932

Each series of senior notes is unsecured and requires payment of interest semi-annually in arrears. We may redeem the notes at our option at any time prior to maturity in whole or in part by paying the principal amount of the Senior Notes being redeemed plus a make-whole premium.

In August 2021, we issued $400.0 million aggregate principal amount of 2031 Senior Notes at an issuance price of 99.758% of the principal amount. We issued the 2031 Senior Notes at an initial discount of $1.0 million, which is being recognized as additional interest expense over the term of the 2031 Senior Notes.

During the three months ended September 30, 2021, we used a portion of the net proceeds from the offering of the 2031 Senior Notes to redeem the $188.8 million aggregate principal balance of our outstanding 2023 Senior Notes. The consideration paid included a make-whole premium of $12.2 million and $2.0 million of accrued and unpaid interest. We recognized a $12.9 million debt satisfaction loss related to the aggregate redemption.

A summary of the maturity dates and interest rates of our unsecured credit agreement, as of ~~September 30, 2021,~~March 31, 2022, are as follows:


	Maturity Date	Current Interest Rate
$600.0 Million Revolving Credit Facility(1)	February 2023	LIBOR + 0.90%
$300.0 Million Term Loan(2)	January 2025	LIBOR + 1.00%

(1) Maturity date of the revolving credit facility can be extended to February 2024 at our option. The interest rate ranges from LIBOR plus 0.775% to 1.45%. At ~~September 30, 2021,~~March 31, 2022, we had no borrowings outstanding and availability of $600.0 million, subject to covenant compliance.

(2) The LIBOR portion of the interest rate was swapped to obtain a current fixed rate of 2.732% per annum.

As of ~~September 30, 2021,~~March 31, 2022, we were compliant with all applicable financial covenants contained in our corporate-level debt agreements.

Contractual Obligations

As of March 31, 2022, we had five ongoing consolidated development projects and expect to incur approximately $229.9 million and $13.9 million of costs in the remainder of 2022 and 2023, respectively, excluding noncontrolling interests' share, to substantially complete the construction of such projects. As of March 31, 2022, we had two consolidated and two non-consolidated joint ventures that own land parcels held for development. We are unable to estimate the timing of any required funding for potential development projects on these parcels.

Results of Operations

Three months ended ~~September 30, 2021~~March 31, 2022 compared with three months ended ~~September 30, 2020~~March 31, 2021. The decrease in net income attributable to common shareholders of ~~$35.3~~$30.4 million was primarily due to the items discussed below.

The decrease in total gross revenues of ~~$1.1~~$12.3 million was primarily due to a decrease in ~~rental revenue due~~termination income of $10.9 million recognized during the three months ended March 31, 2021. In addition, property sales, including the recapitalization of our special purpose industrial portfolio now owned in a non-consolidated joint venture, contributed to the ~~sale of properties,~~decrease which was partially offset by acquisition revenue.

The increase in depreciation and amortization expense of ~~$4.8~~$2.3 million was primarily due to acquisition activity.

The increase in ~~general and administrative~~property operating expense of ~~$1.1~~$3.7 million was primarily due to an increase in operating expense responsibilities at certain properties.

The increase in general and administrative expenses of $2.3 million was primarily due to an increase of $1.2 million in costs incurred related to the Board of Trustees strategic alternatives review and consulting costs related to activism. The remaining $1.1 million increase is primarily payroll expense.

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The decrease in interest and amortization expense of ~~$1.4~~$0.8 million related primarily to a decrease in the amount of our mortgage debt outstanding and a decrease in our overall borrowing rate.

The decrease in debt satisfaction gains, net, of $30.8 million was primarily related to the recognition of a debt satisfaction gain of $27.6 million upon the foreclosure of our Overland Park, Kansas office property, offset by a $10.1 million debt satisfaction loss incurred as a result of the repurchase of a portion of the 2023 Senior Notes and 2024 Senior Notes pursuant to a tender offer in 2020. During the third quarter of September 2021, we incurred debt satisfaction losses of $13.2 million primarily related to the redemption of our 2023 Senior Notes.

The decrease in impairment charges of $4.1 million is related to the timing of an impairment charge recognized on certain properties. The impairments were primarily due to a potential sale, vacancy and lack of leasing prospects.

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The decrease in gains on sales of properties of ~~$4.8~~$21.7 million was related to the timing of property dispositions.

The ~~decrease~~increase in ~~net income attributable to noncontrolling interests~~equity in earnings (losses) of ~~$1.3~~non-consolidated entities of $11.4 million was primarily ~~attributable~~due to ~~an allocation of the OP unit's~~recognizing our share of gains on sale of two properties from ~~LCIF.~~

~~Nine months ended September 30, 2021 compared~~the NNN Office JV L.P. in 2022 with ~~nine months ended September 30, 2020~~. ~~The increase in net income attributable to common shareholders of $41.4 million was primarily due to the items discussed below.~~

The increase in total gross revenues of $10.4 million was primarily a result of an increase of $13.4 million in termination income recognized during the nine months ended September 30, 2021. The increase was offset by a decrease in rental revenue of $2.3 million primarily due to the timing ofno property sales ~~and a $0.8 million decrease~~at our non-consolidated entities in ~~other revenue primarily due to an incentive fee earned upon the sale of a property that we managed for a third-party real estate owner in 2020 with no comparable revenue earned in~~ 2021.

~~The increase in depreciation and amortization expense of $9.7 million was primarily due to acquisition activity.~~

~~The increase in property operating expense of $2.1 million was primarily due to an increase in operating expense responsibilities at certain properties.~~

~~The increase in general and administrative expenses of $2.1 million was primarily due to an increase in payroll expense.~~

~~The increase in non-operating income of $0.6 million was primarily due to funds received for land easements at two of our properties in 2021 with no comparable income in 2020.~~

~~The decrease in interest and amortization expense of $7.4 million related primarily to a decrease in the amount of our mortgage debt outstanding and a decrease in our overall borrowing rate.~~

The decrease in debt satisfaction gains, net, of $32.2 million was primarily the recognition of aggregate debt satisfaction gains of $29.0 million upon the foreclosure of our Charleston, South Carolina and Overland Park, Kansas properties, offset by a $10.1 million debt satisfaction loss incurred as a result of the repurchase of a portion of the 2023 Senior Notes and 2024 Senior Notes pursuant to a tender offer in 2020. During the third quarter of September 2021, we incurred debt satisfaction losses of $13.2 million primarily related to the redemption of our 2023 Senior Notes.

The decrease in impairment charges of $5.7 million is related to the timing of an impairment charge recognized on certain properties. The impairments were primarily due to a potential sale, vacancy and lack of leasing prospects.

~~The increase in gains on sales of properties of $62.9 million related to the timing of property dispositions.~~

The increase in net income or decrease in net loss in future periods will be closely tied to the level of acquisitions made by us. Without acquisitions, the sources of growth in net income are limited to fixed rent adjustments and index adjustments (such as the consumer price index), reduced interest expense on amortizing mortgages and variable rate indebtedness and by controlling other variable overhead costs. However, there are many factors beyond management's control that could offset these items including, without limitation, changes in economic conditions such as the recent economic uncertainty primarily caused by the COVID-19 pandemic, increased interest rates and tenant monetary defaults and the other risks described in this Quarterly Report. Furthermore, our ability to complete acquisitions may be limited due to travel restrictions and social distancing measures during the COVID-19 pandemic.

~~Table of Contents~~

Same-Store Results

Same-store net operating income, or NOI, which is a non-GAAP measure, represents the NOI for consolidated properties that were owned and included in our portfolio for two comparable reporting periods. We define NOI as operating revenues (rental income (less GAAP rent adjustments and lease termination income, net), and other property income) less property operating expenses. As same-store NOI excludes the change in NOI from acquired and disposed of properties, it highlights operating trends such as occupancy levels, rental rates and operating costs on properties. Other REITs may use different methodologies for calculating same-store NOI, and accordingly same-store NOI may not be comparable to other REITs. Management believes that same-store NOI is a useful supplemental measure of our operating performance. However, same-store NOI should not be viewed as an alternative measure of our financial performance since it does not reflect the operations of our entire portfolio, nor does it reflect the impact of general and administrative expenses, acquisition-related expenses, interest expense, depreciation and amortization costs, other nonproperty income and losses, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, or trends in development and construction activities which are significant economic costs and activities that could materially impact our results from operations. We believe that net income is the most directly comparable GAAP measure to same-store NOI.

The following presents our consolidated same-store NOI, for the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ ($000's):


		Nine Months Ended September 30,					Three Months Ended March 31,
		2021		2020			2022		2021
Total cash base rent	Total cash base rent	$	170,269	$	169,229	Total cash base rent	$	54,756	$	52,736
Tenant reimbursements	Tenant reimbursements	21,071		20,086		Tenant reimbursements	9,417		8,818
Property operating expenses	Property operating expenses	(25,400)		(24,518)		Property operating expenses	(11,176)		(9,837)
Same-store NOI	Same-store NOI	$	165,940	$	164,797	Same-store NOI	$	52,997	$	51,717

Our reported same-store NOI increased from the first ~~nine~~three months of ~~2020~~2021 to the first ~~nine~~three months of ~~2021~~2022 by ~~0.7%.~~2.5% primarily due to an increase in occupancy and cash base rents. As of ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ our historical same-store square footage leased was ~~98.7%~~99.4% and ~~99.8%~~98.4%, respectively.

The increase in same-store NOI between periods primarily related to an increase in cash base rent and tenant reimbursements, which was partially offset by an increase in operating expense responsibilities at certain properties. Our same-store results could be further impacted in the future due to COVID-19 related rent deferrals, rent forgiveness or tenant defaults (in the short-term and/or long-term).

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Below is a reconciliation of net income to same-store NOI for periods presented ($000's):


		Nine Months Ended September 30,					Three Months Ended March 31,
		2021		2020			2022		2021
Net income	Net income	$	122,320	$	81,169	Net income	$	10,908	$	41,475

Interest and amortization expense	Interest and amortization expense	35,170		42,610		Interest and amortization expense	10,682		11,486
Provision for income taxes	Provision for income taxes	986		1,361		Provision for income taxes	417		372
Depreciation and amortization	Depreciation and amortization	130,579		120,869		Depreciation and amortization	44,506		42,176
General and administrative	General and administrative	24,695		22,612		General and administrative	10,737		8,420
Transaction costs	Transaction costs	205		81		Transaction costs	89		11
Non-operating/advisory fee income	Non-operating/advisory fee income	(3,239)		(3,392)		Non-operating/advisory fee income	(1,483)		(1,230)
Gains on sales of properties	Gains on sales of properties	(104,767)		(41,876)		Gains on sales of properties	(255)		(21,919)
Impairment charges		2,048		7,792
Debt satisfaction (gains) losses, net		13,222		(18,950)

Equity in (earnings) losses of non-consolidated entities	Equity in (earnings) losses of non-consolidated entities	249		(35)		Equity in (earnings) losses of non-consolidated entities	(11,301)		90
Lease termination income, net	Lease termination income, net	(13,787)		(662)		Lease termination income, net	—		(10,941)
Straight-line adjustments	Straight-line adjustments	(8,146)		(10,224)		Straight-line adjustments	(3,502)		(2,020)
Lease incentives	Lease incentives	605		732		Lease incentives	134		219
Amortization of above/below market leases	Amortization of above/below market leases	(1,211)		(1,110)		Amortization of above/below market leases	(480)		(460)
NOI	NOI	198,929		200,977		NOI	60,452		67,679

Less NOI:	Less NOI:					Less NOI:
Acquisitions and dispositions	Acquisitions and dispositions	(32,989)		(36,180)		Acquisitions and dispositions	(7,455)		(15,962)

Same-Store NOI	Same-Store NOI	$	165,940	$	164,797	Same-Store NOI	$	52,997	$	51,717

Funds From Operations

We believe that Funds from Operations, or FFO, which is a non-GAAP measure, is a widely recognized and appropriate measure of the performance of an equity REIT. We believe FFO is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. As a result, FFO provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities, interest costs and other matters without the inclusion of depreciation and amortization, providing perspective that may not necessarily be apparent from net income.

The National Association of Real Estate Investment Trusts, or NAREIT, defines FFO as ~~“net~~“net income (calculated in accordance with GAAP), excluding depreciation and amortization related to real estate, gains and losses from the sales of certain real estate assets, gains and losses from change in control and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. The reconciling items include amounts to adjust earnings from consolidated partially-owned entities and equity in earnings of unconsolidated affiliates to FFO.”” FFO does not represent cash generated from operating activities in accordance with GAAP and is not indicative of cash available to fund cash needs.

We present FFO available to common shareholders and unitholders - basic and also present FFO available to all equityholders and unitholders - diluted on a company-wide basis as if all securities that are convertible, at the holder's option, into our common shares, are converted at the beginning of the period. We also present Adjusted Company FFO available to all equityholders and unitholders - diluted which adjusts FFO available to all equityholders and unitholders - diluted for certain items which we believe are not indicative of the operating results of our real estate portfolio. We believe this is an appropriate presentation as it is frequently requested by security analysts, investors and other interested parties. Since others do not calculate these measures in a similar fashion, these measures may not be comparable to similarly titled measures as reported by others. These measures should not be considered as an alternative to net income as an indicator of our operating performance or as an alternative to cash flow as a measure of liquidity.

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The following presents a reconciliation of net income attributable to common shareholders to FFO available to common shareholders and unitholders and Adjusted Company FFO available to all equityholders and unitholders for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ (unaudited and dollars in thousands, except share and per share amounts):


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended March 31,
		2021		2020		2021		2020			2022		2021
FUNDS FROM OPERATIONS:	FUNDS FROM OPERATIONS:									FUNDS FROM OPERATIONS:
Basic and Diluted:	Basic and Diluted:									Basic and Diluted:
Net income attributable to common shareholders	Net income attributable to common shareholders	$	5,028	$	40,285	$	115,470	$	74,088	Net income attributable to common shareholders	$	8,989	$	39,401
Adjustments:	Adjustments:									Adjustments:
Depreciation and amortization	Depreciation and amortization	44,652		39,858		128,442		118,605		Depreciation and amortization	43,850		41,478
Impairment charges - real estate		2,048		6,175		2,048		7,792

Noncontrolling interests - OP units	Noncontrolling interests - OP units	240		1,518		1,391		1,702		Noncontrolling interests - OP units	89		239
Amortization of leasing commissions	Amortization of leasing commissions	707		697		2,137		2,264		Amortization of leasing commissions	656		698
Joint venture and noncontrolling interest adjustment	Joint venture and noncontrolling interest adjustment	2,115		2,094		6,344		6,463		Joint venture and noncontrolling interest adjustment	3,150		2,115
Gains on sales of properties, including non-consolidated entities		(16,122)		(20,886)		(104,767)		(42,433)
Gains on sales of properties, including non-consolidated entities, net of tax										Gains on sales of properties, including non-consolidated entities, net of tax	(11,526)		(21,919)
FFO available to common shareholders and unitholders - basic	FFO available to common shareholders and unitholders - basic	38,668		69,741		151,065		168,481		FFO available to common shareholders and unitholders - basic	45,208		62,012
Preferred dividends	Preferred dividends	1,573		1,573		4,718		4,718		Preferred dividends	1,572		1,572
Amount allocated to participating securities	Amount allocated to participating securities	37		46		170		118		Amount allocated to participating securities	61		69
FFO available to all equityholders and unitholders - diluted	FFO available to all equityholders and unitholders - diluted	40,278		71,360		155,953		173,317		FFO available to all equityholders and unitholders - diluted	46,841		63,653
Transaction costs	Transaction costs	64		1		205		81		Transaction costs	89		11
Debt satisfaction gains (losses), net, including non-consolidated entities		13,222		(17,522)		13,222		(18,894)
Strategic alternatives and activism costs										Strategic alternatives and activism costs	1,181		—

Adjusted Company FFO available to all equityholders and unitholders - diluted	Adjusted Company FFO available to all equityholders and unitholders - diluted	$	53,564	$	53,839	$	169,380	$	154,504	Adjusted Company FFO available to all equityholders and unitholders - diluted	$	48,111	$	63,664

Per Common Share and Unit Amounts
Basic:
FFO $ 0.14 $ 0.25 $ 0.54 $ 0.63
Diluted:
FFO $ 0.14 $ 0.25 $ 0.55 $ 0.63
Adjusted Company FFO $ 0.19 $ 0.19 $ 0.59 $ 0.57


Per Common Share and Unit Amounts
Basic:
FFO	$	0.16	$	0.22


Diluted:
FFO	$	0.16	$	0.22
Adjusted Company FFO	$	0.16	$	0.22

Weighted-Average Common Shares:
Basic:
Weighted-average common shares outstanding - basic EPS 278,124,204 274,696,046 276,379,718 264,211,668
Operating partnership units(1)
1,161,757 3,060,436 2,263,105 3,100,309
Weighted-average common shares outstanding - basic FFO 279,285,961 277,756,482 278,642,823 267,311,977
Diluted:
Weighted-average common shares outstanding - diluted EPS 282,048,458 276,022,762 278,581,849 265,446,221
Operating partnership units(1)
1,161,757 3,060,436 2,263,105 3,100,309
Unvested share-based payment awards 53,320 19,261 35,645 19,813
Preferred shares - Series C 4,710,570 4,710,570 4,710,570 4,710,570
Weighted-average common shares outstanding - diluted FFO 287,974,105 283,813,029 285,591,169 273,276,913




Weighted-Average Common Shares:
Basic:
Weighted-average common shares outstanding - basic EPS	283,640,465	275,416,327
Operating partnership units(1)	871,037	2,852,419
Weighted-average common shares outstanding - basic FFO	284,511,502	278,268,746

Diluted:
Weighted-average common shares outstanding - diluted EPS	289,067,778	279,053,697

Operating partnership units(1)	871,037	—
Unvested share-based payment awards	59,384	9,125
Preferred shares - Series C	4,710,570	4,710,570
Weighted-average common shares outstanding - diluted FFO	294,708,769	283,773,392

(1) Includes all OP units other than OP units held by us.

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Off-Balance Sheet Arrangements

As of ~~September 30, 2021,~~March 31, 2022, we had investments in various real estate entities with varying structures. The real estate investments owned by these entities are generally financed with non-recourse debt. Non-recourse debt is generally defined as debt whereby the lenders' sole recourse with respect to borrower defaults is limited to the value of the assets collateralized by the debt. The lender generally does not have recourse against any other assets owned by the borrower or any of the members or partners of the borrower, except for certain specified exceptions listed in the particular loan documents. These exceptions generally relate to "bad boy" acts, including fraud, prohibited transfers and breaches of material representations. We have guaranteed such obligations for certain of our non-consolidated entities with respect to ~~$395.2~~$666.7 million of such non-recourse debt. We believe the likelihood of making any payments under such guaranties is remote and we generally have an agreement from each partner to reimburse us for its proportionate share of any liability related to a guarantee trigger unless such trigger is caused solely by us.

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ITEM 3. QUANTITATIVE AND QUALITATIVE

DISCLOSURES ABOUT MARKET RISK

Our exposure to market risk relates primarily to our variable-rate indebtedness not subject to interest rate swaps and our fixed-rate debt. Our consolidated aggregate principal variable-rate indebtedness not subject to interest rate swaps was $129.1 million at each of ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ which represented ~~8.4%~~8.6% and ~~8.3%~~9.6%, respectively, of our aggregate principal consolidated indebtedness. During the three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ our variable-rate indebtedness had a weighted-average interest rate of ~~1.4% and 2.0%, respectively.~~1.9%. Had the weighted-average interest rate been 100 basis points higher, our interest expense for the three months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ would have increased by ~~$0.6~~$0.3 million, and $0.4 million, respectively. During the nine months ended September 30, 2021 and 2020, our variable-rate interest rate was 1.7% and 2.5%, respectively. Had the weighted-average interest rate been 100 basis points higher, our interest expense for the nine months ended September 30, 2021 and 2020 would have increased by $1.3 million and $1.4 million, respectively.each period. At each of ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ our aggregate principal consolidated fixed-rate debt was $1.4 billion and $1.2 billion, respectively, which represented ~~91.6%~~91.4% and ~~91.7%~~90.4%, respectively, of our aggregate principal indebtedness.

For certain of our financial instruments, fair values are not readily available since there are no active trading markets as characterized by current exchanges between willing parties. Accordingly, we derive or estimate fair values using various valuation techniques, such as computing the present value of estimated future cash flows using discount rates commensurate with the risks involved. However, the determination of estimated cash flows may be subjective and imprecise. Changes in assumptions or estimation methodologies can have a material effect on these estimated fair values, especially given the volatility of the current economic environment. The following fair value was determined using the interest rates that we believe our outstanding fixed-rate indebtedness would warrant as of ~~September 30, 2021.~~March 31, 2022. We believe the fair value is indicative of the interest rate environment as of ~~September 30, 2021,~~March 31, 2022, but this amount does not take into consideration the effects of subsequent interest rate fluctuations. Accordingly, we estimate that the fair value of our fixed-rate indebtedness was ~~$1.4~~$1.3 billion as of ~~September 30, 2021.~~March 31, 2022.

Our interest rate risk objectives are to limit the impact of interest rate fluctuations on earnings and cash flows and to lower our overall borrowing costs. To achieve these objectives, we manage our exposure to fluctuations in market interest rates through the use of fixed-rate debt instruments to the extent that reasonably favorable rates are obtainable with such arrangements. We may enter into derivative financial instruments such as interest rate swaps or caps to mitigate our interest rate risk on a related financial instrument or to effectively lock the interest rate on a portion of our variable-rate debt. As of ~~September 30, 2021,~~March 31, 2022, we had four interest rate swap agreements (see note 8 to our unaudited condensed consolidated financial statements contained in this Quarterly Report).

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as such terms are defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report to determine if such controls and procedures were effective to ensure that information required to be disclosed by us in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and that information required to be disclosed by us in reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Management, including each of our Chief Executive Officer and Chief Financial Officer, has concluded that our disclosure controls and procedures were effective as of ~~September 30, 2021.~~March 31, 2022.

Changes in Internal Control Over Financial Reporting. There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this Quarterly Report relates that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls. Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations. Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control over financial reporting also can be circumvented by collusion or improper management override. Because of such limitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

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PART II - OTHER INFORMATION

ITEM 1.Legal Proceedings.

From time to time, we are directly and indirectly involved in legal proceedings arising in the ordinary course of our business, including claims by lenders under non-recourse carve-out guarantees. We believe, based on currently available information, and after consultation with legal counsel, that although the outcomes of those normal course proceedings are uncertain, the results of such proceedings, in the aggregate, will not have a material adverse effect on our business, financial condition and results of operations.

ITEM 1A.Risk Factors.

There have been no material changes in our risk factors from those disclosed in the Annual Report.

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

There were no share repurchases during the quarter ended ~~September 30, 2021~~March 31, 2022 under our share repurchase authorization most recently announced on November 2, 2018, which has no expiration date. ~~There~~As of March 31, 2022, there were 8,976,315 shares that may yet be purchased under our share repurchase authorization.

ITEM 3.Defaults Upon Senior Securities - not applicable.

ITEM 4.Mine Safety Disclosures - not applicable.

ITEM 5.Other Information - not applicable.

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ITEM 6.Exhibits.


Exhibit No.		Description

3.1	——	Articles of Merger and Amended and Restated Declaration of Trust of the Company, dated December 31, 2006 (filed as Exhibit 3.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed January 8, 2007 (the ~~“01/~~“01/08/07 ~~8-K”~~8-K”))(1)
3.2	——	Articles Supplementary Relating to the Reclassification of 8.05% Series B Cumulative Redeemable Preferred Stock, par value $0.0001 per share, and 7.55% Series D Cumulative Redeemable Preferred Stock, par value $0.0001 per share (filed as Exhibit 3.4 to the Company's Current Report on Form 8-K filed November 21, 2013)(1)
3.3	—	Articles of Amendment to the Amended and Restated Declaration of Trust, dated as of December 14, 2021 (filed as of Exhibit 3.1 to the Company's Current Report on Form 8-K filed on December 16, 2021)(1)
3.4	——	Amended and Restated By-laws of the Company (filed as Exhibit 3.2 to the 01/08/07 8-K)(1)
~~3.4~~3.5	——	First Amendment to Amended and Restated By-laws of the Company (filed as Exhibit 3.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed November 20, 2009) (1)
~~3.5~~3.6	——	Second Amendment to Amended and Restated By-Laws of the Company (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K filed April 3, 2017) (1)
~~3.6~~3.7	——	Third Amendment to Amended and Restated By-Laws of the Company (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K filed April 9, 2020)(1)
~~3.7~~3.8	——	Sixth Amended and Restated Agreement of Limited Partnership of LCIF, dated as of December 30, 2013 (filed as Exhibit 3.25 to the Company's Annual Report on Form 10-K filed February 26, 2014)(1)
~~3.8~~3.9	——	First Amendment to Sixth Amended and Restated Agreement of Limited Partnership of LCIF, dated as of July 12, 2021 (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K filed July 16, 2021)(1)
4.1	——	Specimen of Common Shares Certificate of the Company (filed as Exhibit 4.1 to the ~~Company’s~~Company’s Annual Report on Form 10-K for the year ended December 31, ~~2006)~~2021)(1)
4.2	——	Form of 6.50% Series C Cumulative Convertible Preferred Stock certificate (filed as Exhibit 4.1 to the Company's Registration Statement on Form 8A filed December 8, 2004)(1)
4.3	——	Indenture, dated as of January 29, 2007, among the Company (as successor by merger), the other guarantors named therein and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed January 29, 2007 (the ~~“01/~~“01/29/07 ~~8-K”~~8-K”))(1)
4.4	——	Amended and Restated Trust Agreement, dated March 21, 2007, among the Company, The Bank of New York Trust Company, National Association, The Bank of New York (Delaware), the Administrative Trustees (as named therein) and the several holders of the Preferred Securities from time to time (filed as Exhibit 4.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed March 27, 2007 (the ~~“03/~~“03/27/2007 ~~8-K”~~8-K”))(1)
4.5	——	Junior Subordinated Indenture, dated as of March 21, 2007, between Lexington Realty Trust and The Bank of New York Trust Company, National Association (filed as Exhibit 4.2 to the 03/27/07 8-K)(1)
4.6	——	Fourth Supplemental Indenture, dated as of December 31, 2008, among the Company, the other guarantors named therein and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed January 2, 2009)(1)
4.7	——	Fifth Supplemental Indenture, dated as of June 9, 2009, among the Company (as successor to the MLP), the other guarantors named therein and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed June 15, 2009)(1)
4.8	——	Sixth Supplemental Indenture, dated as of January 26, 2010 among the Company, the guarantors named therein and U.S. Bank National Association, as trustee, including the Form of 6.00% Convertible Guaranteed Notes due 2030 (filed as Exhibit 4.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed January 26, 2010)(1)
4.9	——	Seventh Supplemental Indenture, dated as of September 28, 2012, among the Company, certain subsidiaries of the Company signatories thereto, and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed October 3, 2012)(1)
4.10	——	Eighth Supplemental Indenture, dated as of February 13, 2013, among the Company, certain subsidiaries of the Company signatories thereto, and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed February 13, 2013 (the ~~“02/~~“02/13/13 ~~8-K”~~8-K”))(1)
4.11	——	Ninth Supplemental Indenture, dated as of May 6, 2013, among the Company, certain subsidiaries of the Company signatories thereto, and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed May 8, 2013)(1)
4.12	——	Tenth Supplemental Indenture, dated as of June 13, 2013, among the Company, certain subsidiaries of the Company signatories thereto, and U.S. Bank National Association, as trustee (filed as Exhibit 4.3 to the Company's Current Report on Form 8-K filed on June 13, 2013 (the ~~“06/~~“06/13/13 ~~8-K”~~8-K”))(1)

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4.13	——	Tenth Supplemental Indenture, dated as of September 30, 2013, among the Company, certain subsidiaries of the Company signatories thereto, and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed on October 3, 2013 (the ~~“10/~~“10/03/2013 ~~8-K”~~8-K”))(1)
4.14	——	Indenture, dated as of June 10, 2013, among the Company, the subsidiary guarantors named therein, and U.S. Bank National Association, as trustee ~~(filed~~(filed as Exhibit 4.1 to the 06/13/2013 8-K))(1)
4.15	——	First Supplemental Indenture, dated as of September 30, 2013, among the Company, the subsidiary guarantors named therein, and U.S. Bank National Association, as trustee (filed as Exhibit 4.2 to the 10/03/2013 8-K)(1)
4.16	——	Indenture dated as of May 9, 2014, among the Company, LCIF and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed May 13, 2014)(1)
4.17	——	First Supplemental Indenture, dated as of May 20, 2014, among the Company, LCIF and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed May 20, 2014)(1)
4.18	——	Second Supplemental Indenture, dated as of August 28, 2020, among the Company and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed August 28, 2020)(1)
4.19	——	Third Supplemental Indenture, dated as of August 30, 2021, among the Company and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed August 30, 2021)(1)
31.1	——	Certification pursuant to ~~rule~~R ule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002(2)
31.2	——	Certification pursuant to ~~rule~~R ule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002(2)
32.1	——	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(3)
32.2	——	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(3)
101.INS	——	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document (2, 5)
101.SCH	——	Inline XBRL Taxonomy Extension Schema (2, 5)
101.CAL	——	Inline XBRL Taxonomy Extension Calculation Linkbase (2, 5)
101.DEF	——	Inline XBRL Taxonomy Extension Definition Linkbase Document (2, 5)
101.LAB	——	Inline XBRL Taxonomy Extension Label Linkbase Document (2, 5)
101.PRE	——	Inline XBRL Taxonomy Extension Presentation Linkbase Document (2, 5)

(1) Incorporated by reference.

(2) Filed herewith.

(3) Furnished herewith. This exhibit shall not be deemed "filed" for purposes of Section 11 or 12 of the Securities Act of 1933, as amended (the "Securities Act"), or Section 18 of the Securities Exchanges Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of those sections, and shall not be part of any registration statement to which it may relate, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act or the Exchange Act, except as set forth by specific reference in such filing or document.

(4) Management contract or compensatory plan or arrangement.

(5) The following materials from this Quarterly Report on Form 10-Q for the period ended ~~September 30, 2021~~March 31, 2022 are formatted in Inline XBRL (Extensible Business Reporting Language): (i) Unaudited Condensed Consolidated Balance Sheets of the Company; (ii) Unaudited Condensed Consolidated Statements of Operations of the Company; (iii) Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) of the Company; (iv) Unaudited Condensed Consolidated Statements of Changes in Equity of the Company; (v) Unaudited Condensed Consolidated Statements of Cash Flows of the Company; and (vi) Notes to Unaudited Condensed Consolidated Financial Statements of the Company, detailed tagged.

4037

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		~~Lexington Realty~~LXP Industrial Trust

Date:	~~November 4, 2021~~May 5, 2022	By:	/s/ T. Wilson Eglin
			T. Wilson Eglin
			Chief Executive Officer and President (principal executive officer)

Date:	~~November 4, 2021~~May 5, 2022	By:	/s/ Beth Boulerice
			Beth Boulerice
			Chief Financial Officer, Executive Vice President and Treasurer (principal financial officer)

4138


Three Months Ended September 30, 2021			Lexington Realty Trust Shareholders
	Total		Preferred Shares		Common Shares		Additional Paid-in-Capital		Accumulated Distributions in Excess of Net Income		Accumulated Other Comprehensive Loss		Noncontrolling Interests
Balance June 30, 2021	$	2,051,369	$	94,016	$	28	$	3,195,040	$	(1,250,735)	$	(12,041)	$	25,061
Issuance of partnership interest in real estate	5,965		—		—		—		—		—		5,965
Redemption of noncontrolling OP units for common shares	—		—		—		202		—		—		(202)
Redemption of noncontrolling OP units for real estate	(22,305)		—		—		(12,919)		—		—		(9,386)
Issuance of common shares and deferred compensation amortization, net	57,527		—		—		57,527		—		—		—

Dividends/distributions	(32,402)		—		—		—		(32,037)		—		(365)
Net income	7,058		—		—		—		6,638		—		420
Other comprehensive income	1,150		—		—		—		—		1,150		—

Balance September 30, 2021	$	2,068,362	$	94,016	$	28	$	3,239,850	$	(1,276,134)	$	(10,891)	$	21,493


Nine Months Ended September 30, 2021			Lexington Realty Trust Shareholders
	Total		Preferred Shares		Common Shares		Additional Paid-in-Capital		Accumulated Distributions in Excess of Net Income		Accumulated Other Comprehensive Loss		Noncontrolling Interests
December 31, 2020	$	1,991,137	$	94,016	$	28	$	3,196,315	$	(1,301,726)	$	(17,963)	$	20,467
Issuance of partnership interest in real estate	11,050		—		—		—		—		—		11,050
Redemption of noncontrolling OP units for common shares	—		—		—		670		—		—		(670)
Redemption of noncontrolling OP units for real estate	(22,305)		—		—		(12,919)		—		—		(9,386)
Issuance of common shares and deferred compensation amortization, net	60,469		—		—		60,469		—		—		—
Repurchase of common shares to settle tax obligations	(5,120)		—		—		(5,120)		—		—		—
Forfeiture of employee common shares	2		—		—		—		2		—		—
Dividends/distributions	(96,263)		—		—		—		(94,768)		—		(1,495)
Net income	122,320		—		—		—		120,358		—		1,962
Other comprehensive income	7,072		—		—		—		—		7,072		—
Reallocation of noncontrolling interests	—		—		—		435		—		—		(435)
Balance September 30, 2021	$	2,068,362	$	94,016	$	28	$	3,239,850	$	(1,276,134)	$	(10,891)	$	21,493


Market(1)	Acquisition/Completion Date	Initial Cost Basis		Primary Lease Expiration at Acquisition Date	Land		Building and Improvements		Lease in-place Value Intangible		Above (Below) Market Lease Intangible, net
Indianapolis, IN	January 2021	$	14,310	12/2024	$	1,208	$	12,052	$	1,035	$	15
Indianapolis, IN	January 2021	14,120		08/2025	1,162		11,825		1,133		—
Central Florida	January 2021	22,358		05/2031	1,416		19,910		1,032		—
Columbus, OH(2)	March 2021(2)	19,517		03/2024	2,800		16,717		—		—
Houston, TX	May 2021	28,292		08/2028	4,272		22,295		1,725		—
Houston, TX	May 2021	37,686		12/2026	6,489		28,470		2,727		—
Houston, TX	May 2021	11,512		08/2024	1,792		9,089		631		—
Cincinnati/Dayton, OH	June 2021	18,674		06/2023	1,109		16,477		1,088		—
Central Florida	June 2021	48,593		N/A	2,610		45,983		—		—
Greenville-Spartanburg, SC	June 2021	36,903		09/2025	2,376		32,121		2,406		—
Greenville-Spartanburg, SC	June 2021	23,812		06/2026	1,329		21,419		1,064		—
Greenville-Spartanburg, SC	July 2021	29,421		04/2029	2,819		24,508		2,094		—
Greenville-Spartanburg, SC	July 2021	26,106		12/2029	1,169		23,070		1,867		—
Greenville-Spartanburg, SC(3)	July 2021	18,394		N/A	1,020		17,374		—		—
Greenville-Spartanburg, SC	July 2021	31,646		09/2026	1,710		27,817		2,119		—
Columbus, OH	August 2021	29,265		11/2029	2,251		25,184		1,830		—

		$	410,609		$	35,532	$	354,311	$	20,751	$	15


	As of September 30, 2021				As of December 31, 2020
	Carrying Amount		Fair Value		Carrying Amount		Fair Value



Liabilities
Debt	$	1,529,113	$	1,533,534	$	1,341,242	$	1,368,151



2021 - remainder	$	68,554
2022	277,267
2023	277,523
2024	241,780
2025	211,975
2026	188,128
Thereafter	767,235
Total	$	2,032,462


	Operating Leases
2021 - remainder	$	1,192
2022	5,005
2023	5,155
2024	5,021
2025	5,021
2026	3,985
Thereafter	13,486
Total lease payments	$	38,865
Less: Imputed interest	(8,756)
Present value of operating lease liabilities	$	30,109






	Nine Months Ended September 30, 2021
	Shares Sold	Net Proceeds
2021 ATM Issuances	1,052,800	$13,574

	Nine Months Ended September 30, 2020
	Shares Sold	Net Proceeds
2020 ATM Issuances	5,950,882	$61,032


Market (1)	Square Feet	Initial Capitalized Cost (millions)		Date Acquired/Completed	Approximate Lease Term (years)(2)	% Leased at Acquisition
Indianapolis, IN	149,072	$	14.3	January 2021	4	100	%
Indianapolis, IN	149,072	14.1		January 2021	6	100	%
Central Florida	222,134	22.4		January 2021	10	53	%
Columbus, OH(3)	320,190	19.5		March 2021	3	100	%
Houston, TX	233,190	28.3		May 2021	7	100	%
Houston, TX	402,648	37.7		May 2021	6	100	%
Houston, TX	102,863	11.5		May 2021	3	100	%
Cincinnati/Dayton, OH	194,936	18.7		June 2021	2	100	%
Central Florida	510,484	48.6		June 2021	N/A	—	%
Greenville-Spartanburg, SC	396,073	36.9		June 2021	4	100	%
Greenville-Spartanburg, SC	210,820	23.8		June 2021	7	62	%
Greenville-Spartanburg, SC	275,400	29.4		July 2021	8	100	%
Greenville-Spartanburg, SC	235,600	26.1		July 2021	9	100	%
Greenville-Spartanburg, SC(4)	195,000	18.4		July 2021	N/A	—	%
Greenville-Spartanburg, SC	327,360	31.6		July 2021	5	100	%
Columbus, OH	292,730	29.3		August 2021	8	100	%
	4,217,572	$	410.6