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As filed with the Securities and Exchange Commission on August 20, 2010
Registration No.
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM S-4
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
 
BIOMED REALTY LOGO
BIOMED REALTY TRUST, INC.
BIOMED REALTY, L.P.
(Exact name of registrants as specified in their charters)
 
                     
BioMed Realty Trust, Inc.   BioMed Realty, L.P.
Maryland   6798   20-1142292   Maryland   6798   20-1320636
                     
(State or other jurisdiction of
incorporation or organization)
  (Primary Standard Industrial
Classification Code Number)
  (I.R.S. Employer
Identification No.)
  (State or other jurisdiction of
incorporation or organization)
  (Primary Standard Industrial
Classification Code Number)
  (I.R.S. Employer
Identification No.)
17190 Bernardo Center Drive
San Diego, California 92128
(858) 485-9840

(Address, including zip code, and telephone number, including area code, of registrants’ principal executive offices)
Alan D. Gold
Chairman and Chief Executive Officer
BioMed Realty Trust, Inc.
17190 Bernardo Center Drive
San Diego, California 92128
(858) 485-9840

(Name, address, including zip code, and telephone number, including area code, of agent for service)
 
Copy to:
Craig M. Garner, Esq.
Divakar Gupta, Esq.
Latham & Watkins LLP
12636 High Bluff Drive, Suite 400
San Diego, California 92130
(858) 523-5400
Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after the effective date of this registration statement.
If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. o
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
                 
BioMed Realty Trust, Inc.:   Large-accelerated filer þ   Accelerated filer o   Non-accelerated filer o   Smaller reporting company o
            (Do not check if a smaller reporting company)    
                 
BioMed Realty, L.P.:   Large-accelerated filer o   Accelerated filer o   Non-accelerated filer þ   Smaller reporting company o
            (Do not check if a smaller reporting company)    
CALCULATION OF REGISTRATION FEE
                                             
 
                  Proposed maximum       Proposed maximum            
  Title of each class of securities     Amount to be       offering price per       aggregate offering       Amount of    
  to be registered     registered       unit (1)       price       registration fee    
 
6.125% Senior Notes due 2020
    $ 250,000,000         100 %     $ 250,000,000       $ 17,825    
 
Guarantees of 6.125% Senior Notes due 2020
      (2 )       (2 )       (2 )       (2 )  
 
 
(1)   Estimated solely for purposes of calculating the registration fee pursuant to Rule 457(f).
 
(2)   No separate consideration will be received with respect to these guarantees and, therefore, no registration fee is attributed to them.
The Registrants hereby amend this registration statement on such date or dates as may be necessary to delay its effective date until the Registrants shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
 
 

 


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The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED AUGUST 20, 2010
PROSPECTUS
BIOMED REALTY LOGO
BIOMED REALTY, L.P.
OFFER TO EXCHANGE
$250,000,000 aggregate principal amount of its
6.125% Senior Notes due 2020
which have been registered under the Securities Act of 1933, as amended,
for any and all of its outstanding 6.125% Senior Notes due 2020
Guaranteed by BioMed Realty Trust, Inc.
 
    The exchange offer expires at 5:00 p.m., New York City time, on      , 2010, unless extended.
 
    We will exchange all outstanding notes that are validly tendered and not validly withdrawn for an equal principal amount of a new series of notes which are registered under the Securities Act of 1933, as amended.
 
    The exchange offer is not subject to any conditions other than that it not violate applicable law or any applicable interpretation of the staff of the Securities and Exchange Commission.
 
    You may withdraw tenders of outstanding notes at any time before the exchange offer expires.
 
    We believe that the exchange of notes will not be a taxable event for U.S. federal income tax purposes.
 
    We will not receive any proceeds from the exchange offer.
 
    The terms of the new series of notes are substantially identical to the outstanding notes, except for transfer restrictions and registration rights relating to the outstanding notes.
 
    The outstanding notes are, and the new series of notes will be, fully and unconditionally guaranteed by BioMed Realty Trust, Inc., a Maryland corporation, our sole general partner, which has no material assets other than its investment in us.
 
    You may tender outstanding notes only in denominations of $1,000 and integral multiples thereof.
 
    Our affiliates may not participate in the exchange offer.
 
    No public market exists for the outstanding notes. We do not intend to list the exchange notes on any securities exchange and, therefore, no active public market is anticipated for the exchange notes.
 
    Each broker-dealer that receives exchange notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for outstanding notes where such outstanding notes were acquired by such broker-dealer as a result of market-making activities or other trading activities.
Please refer to “Risk Factors” beginning on page 11 of this prospectus for
a description of the risks you should consider when evaluating an investment in these securities.
     We are not making this exchange offer in any state or other jurisdiction where it is not permitted.
     Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is      , 2010.

 


 

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 EX-99.6
 EX-101 INSTANCE DOCUMENT
 EX-101 SCHEMA DOCUMENT
 EX-101 CALCULATION LINKBASE DOCUMENT
 EX-101 LABELS LINKBASE DOCUMENT
 EX-101 PRESENTATION LINKBASE DOCUMENT
 EX-101 DEFINITION LINKBASE DOCUMENT
          You should rely only on the information contained in or incorporated by reference in this prospectus. We have not authorized anyone to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. You should assume that the information contained in this prospectus, as well as information that we have previously filed with the Securities and Exchange Commission and incorporated by reference, is accurate only as of the date of the applicable document. Our business, financial condition, results of operations and prospects may have changed since those dates.
          This prospectus incorporates important business and financial information about us that is not included in or delivered with this prospectus, and such information is available without charge to holders of the notes upon written or oral request to Investor Relations, BioMed Realty Trust, Inc., 17190 Bernardo Center Drive, San Diego, California 92128 (telephone: (858) 485-9840). In order to obtain timely delivery, note holders must request the information no later than five business days prior to the expiration of the exchange offer contemplated by this prospectus, or       , 2010.
          Each broker-dealer that receives exchange notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. The letter of transmittal delivered with this prospectus states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act of 1933, as amended. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for outstanding private notes where such outstanding private notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that, starting on the expiration date of the exchange offer and ending on the close of business one year after such expiration date, subject to extension in limited circumstances, we will make this prospectus available to any broker-dealer for use in connection with any such resale. See “Plan of Distribution.”

 


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PROSPECTUS SUMMARY
          You should read the following summary together with the more detailed information regarding our company and the financial statements and related notes appearing elsewhere in this prospectus or incorporated by reference in this prospectus, including under the caption “Risk Factors.”
Explanatory Note
          This prospectus includes combined disclosure for BioMed Realty Trust, Inc., a Maryland corporation, and BioMed Realty, L.P., a Maryland limited partnership of which BioMed Realty Trust, Inc. is the parent company and general partner. Unless otherwise indicated or unless the context requires otherwise, all references in this prospectus to “we,” “us,” “our” or “our company” refer to BioMed Realty Trust, Inc. together with its consolidated subsidiaries, including BioMed Realty, L.P. Unless otherwise indicated or unless the context requires otherwise, all references in this prospectus to “our operating partnership” or “the operating partnership” refer to BioMed Realty, L.P. together with its consolidated subsidiaries.
          BioMed Realty Trust, Inc. operates as a real estate investment trust, or REIT, and the general partner of BioMed Realty, L.P. As of June 30, 2010, BioMed Realty Trust, Inc. owned an approximate 97.4% partnership interest and other limited partners, including some of our directors, executive officers and their affiliates, owned the remaining 2.6% partnership interest (including long term incentive plan units) in BioMed Realty, L.P. As the sole general partner of BioMed Realty, L.P., BioMed Realty Trust, Inc. has the full, exclusive and complete responsibility for the operating partnership’s day-to-day management and control.
          There are few differences between our company and our operating partnership, which are reflected in the disclosure in this prospectus. We believe it is important to understand the differences between our company and our operating partnership in the context of how BioMed Realty Trust, Inc. and BioMed Realty, L.P. operate as an interrelated consolidated company. BioMed Realty Trust, Inc. is a REIT, whose only material asset is its ownership of partnership interests of BioMed Realty, L.P. As a result, BioMed Realty Trust, Inc. does not conduct business itself, other than acting as the sole general partner of BioMed Realty, L.P., issuing public equity from time to time and guaranteeing certain debt of BioMed Realty, L.P. BioMed Realty Trust, Inc. itself does not hold any indebtedness but guarantees some of the secured and unsecured debt of BioMed Realty, L.P., as disclosed in this prospectus. BioMed Realty, L.P. holds substantially all the assets of the company and holds the ownership interests in the company’s joint ventures. BioMed Realty, L.P. conducts the operations of the business and is structured as a partnership with no publicly traded equity. Except for net proceeds from public equity issuances by BioMed Realty Trust, Inc., which are generally contributed to BioMed Realty, L.P. in exchange for partnership units, BioMed Realty, L.P. generates the capital required by the company’s business through BioMed Realty, L.P.’s operations, by BioMed Realty, L.P.’s direct or indirect incurrence of indebtedness or through the issuance of partnership units.
          Noncontrolling interests and stockholders’ equity and partners’ capital are the main areas of difference between the consolidated financial statements of BioMed Realty Trust, Inc. and those of BioMed Realty, L.P. The common partnership and long term incentive plan units in BioMed Realty, L.P. that are not owned by BioMed Realty Trust, Inc. are accounted for as partners’ capital in BioMed Realty, L.P.’s financial statements and as noncontrolling interests in BioMed Realty Trust, Inc.’s financial statements. The noncontrolling interests in BioMed Realty, L.P.’s financial statements include the interests of joint venture partners. The noncontrolling interests in BioMed Realty Trust, Inc.’s financial statements include the same noncontrolling interests at the BioMed Realty, L.P. level as well as the limited partnership unitholders of BioMed Realty, L.P., not including BioMed Realty Trust, Inc. The differences between stockholders’ equity and partners’ capital result from the differences in the equity issued at the BioMed Realty Trust, Inc. and the BioMed Realty, L.P. levels.
Our Company
Overview
          We own, acquire, develop, redevelop, lease and manage laboratory and office space for the life science industry. Our tenants primarily include biotechnology and pharmaceutical companies, scientific research institutions, government agencies and other entities involved in the life science industry. Our properties are generally located in markets with well-established reputations as centers for scientific research, including Boston, San Diego, San Francisco, Seattle, Maryland, Pennsylvania and New York/New Jersey. BioMed Realty Trust, Inc. operates as a REIT for federal income tax purposes. BioMed Realty, L.P. is the entity through which BioMed Realty Trust, Inc. conducts its business and owns its assets. At June 30, 2010, our portfolio consisted of 73 properties, representing 120 buildings with an aggregate of approximately 11.0 million rentable square feet.

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          Our senior management team has significant experience in the real estate industry, principally focusing on properties designed for life science tenants. We operate as a fully integrated, self-administered and self-managed REIT, providing management, leasing, development and administrative services to our properties. As of June 30, 2010, we had 139 employees.
          Our principal offices are located at 17190 Bernardo Center Drive, San Diego, California 92128. Our telephone number at that location is (858) 485-9840. Our website is located at www.biomedrealty.com. The information found on, or otherwise accessible through, our website is not incorporated into, and does not form a part of, this prospectus or any other report or document we file with or furnish to the Securities and Exchange Commission, or the SEC.

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THE EXCHANGE OFFER
     
The Exchange Offer
  We are offering to exchange the 6.125% Senior Notes due 2020 offered by this prospectus (the exchange notes) for the outstanding 6.125% Senior Notes due 2020 (the private notes and together with the exchange notes, the Notes due 2020) that are properly tendered and accepted. You may tender outstanding private notes only in denominations of $1,000 and integral multiples thereof. We will issue the exchange notes on or promptly after the exchange offer expires. As of the date of this prospectus, $250,000,000 principal amount of private notes is outstanding.
 
   
Expiration Date
  The exchange offer will expire at 5:00 p.m., New York City time, on , 2010 (the 21st business day following commencement of the exchange offer), unless extended, in which case the expiration date will mean the latest date and time to which we extend the exchange offer.
 
   
Conditions to the Exchange Offer
  The exchange offer is not subject to any condition other than that it not violate applicable law or any applicable interpretation of the staff of the SEC. The exchange offer is not conditioned upon any minimum principal amount of private notes being tendered for exchange. We intend to conduct the exchange offer in accordance with the provisions of the registration rights agreement with respect to the private notes and the applicable requirements of the Securities Act of 1933, as amended, or the Securities Act, the Securities Exchange Act of 1934, as amended, or the Exchange Act, and the rules and regulations of the SEC.
 
   
Procedures for Tendering Private Notes
  If you wish to tender your private notes for exchange notes pursuant to the exchange offer, you must complete and sign a letter of transmittal in accordance with the instructions contained in the letter and forward it by mail, facsimile or hand delivery, together with any other documents required by the letter of transmittal, to the Exchange Agent (as defined below), either with the private notes to be tendered or in compliance with the specified procedures for guaranteed delivery of notes. Certain brokers, dealers, commercial banks, trust companies and other nominees may also effect tenders by book-entry transfer. Holders of private notes registered in the name of a broker, dealer, commercial bank, trust company or other nominee are urged to contact such person promptly if they wish to tender private notes pursuant to the exchange offer. See “The Exchange Offer—Procedures for Tendering.”
 
   
 
  Letters of transmittal and certificates representing private notes should not be sent to us. Such documents should only be sent to the Exchange Agent. Questions regarding how to tender private notes and requests for information should be directed to the Exchange Agent. See “The Exchange Offer—Exchange Agent.”
 
   
Acceptance of the Private Notes and Delivery of the Exchange Notes
  Subject to the satisfaction or waiver of the conditions to the exchange offer, we will accept for exchange any and all private notes which are validly tendered in the exchange offer and not withdrawn before 5:00 p.m., New York City time, on the expiration date.
 
   
Withdrawal Rights
  You may withdraw the tender of your private notes at any time before 5:00 p.m., New York City time, on the expiration date, by complying with the procedures for withdrawal described in this prospectus under the heading “The Exchange Offer—Withdrawal of Tenders.”
 
   
U.S. Federal Income Tax Consequences
  We believe that the exchange of notes will not be a taxable event for U.S. federal income tax purposes. For a discussion of material federal tax considerations relating to the exchange of notes, see “U.S. Federal Income Tax Consequences.”
 
   
Exchange Agent
  U.S. Bank National Association, the registrar and paying agent for the notes under the indenture governing the notes, is serving as the exchange agent for the notes (the Exchange Agent).

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Consequences of Failure to Exchange
  If you do not exchange your private notes for the exchange notes, you will continue to be subject to the restrictions on transfer provided in the private notes and in the indenture governing the private notes. In general, the private notes may not be offered or sold, unless registered under the Securities Act, except pursuant to an exemption from, or in a transaction not subject to, the Securities Act and applicable state securities laws. We do not currently plan to register the resale of the private notes under the Securities Act.
 
   
Registration Rights Agreement
  You are entitled to exchange your private notes for the exchange notes with substantially identical terms. This exchange offer satisfies this right. After the exchange offer is completed, you will no longer be entitled to any exchange or registration rights with respect to your private notes.
We explain the exchange offer in greater detail beginning on page 30.

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THE EXCHANGE NOTES
          The summary below describes the principal terms of the exchange notes. Certain of the terms and conditions described below are subject to important limitations and exceptions. The “Description of Notes” section of this prospectus contains a more detailed description of the terms and conditions of the exchange notes. For purposes of this section entitled “—The Exchange Notes” and the section entitled “Description of Notes,” references to “we,” “us,” and “our” refer only to BioMed Realty, L.P. and not to its subsidiaries or BioMed Realty Trust, Inc., and references to “notes” mean the exchange notes.
          The form and terms of the exchange notes are the same as the form and terms of the private notes, except that the exchange notes will be registered under the Securities Act and, therefore, the exchange notes will not be subject to the transfer restrictions, registration rights and provisions providing for an increase in the interest rate applicable to the private notes. The exchange notes will evidence the same debt as the private notes, and both the private notes and the exchange notes are governed by the same indenture.
     
Issuer of Notes
  BioMed Realty, L.P.
 
   
Securities Offered
  $250,000,000 aggregate principal amount of 6.125% Senior Notes due 2020.
 
   
Ranking of Notes
  The notes will be our senior unsecured obligations and will rank equally with all of our other senior unsecured indebtedness. However, the notes will be effectively subordinated to all of our existing and future secured indebtedness (to the extent of the collateral securing such indebtedness) and to all existing and future liabilities and preferred equity of our subsidiaries under our unsecured line of credit, including guarantees provided by our subsidiaries under our unsecured line of credit.
 
   
Guarantee
  The notes will be fully and unconditionally guaranteed by BioMed Realty Trust, Inc. The guarantee will be a senior unsecured obligation of BioMed Realty Trust, Inc. and will rank equally in right of payment with other senior unsecured obligations of BioMed Realty Trust, Inc. BioMed Realty Trust, Inc. has no material assets other than its investment in us.
 
   
Interest
  The notes will bear interest at a rate of 6.125% per year. Interest will be payable semi-annually in arrears on April 15 and October 15 of each year.
 
   
Maturity
  The notes will mature on April 15, 2020, unless previously redeemed by us at our option prior to such date.
 
   
Our Redemption Rights
  We may redeem the notes at our option and in our sole discretion, at any time in whole or from time to time in part, at the redemption price specified herein. If the notes are redeemed on or after 90 days prior to the maturity date, the redemption price will be equal to 100% of the principal amount of the notes being redeemed. See “Description of Notes—Our Redemption Rights” in this prospectus.
 
   
Certain Covenants
  The indenture governing the notes contains certain covenants that, among other things, limit our, our guarantor’s and our subsidiaries’ ability to:
 
   
 
 
consummate a merger, consolidation or sale of all or substantially all of our assets; and

incur secured and unsecured indebtedness.
 
   
 
  These covenants are subject to a number of important exceptions and qualifications. See “Description of Notes” in this prospectus.
 
   
Trading
  The notes are a new issue of securities with no established trading market. We do not intend to apply for listing of the notes on any securities exchange or for quotation of the notes on any automated dealer quotation system. The initial purchasers of the notes have advised us that they intend to make a market in the notes, but they are not obligated to do so and may discontinue any market-making at any time without notice.
 
   
Book-Entry Form
  The notes will be issued in the form of one or more fully registered global notes in book-entry form, which will be deposited with, or on behalf of, The Depository Trust Company, or DTC, in New York, New York. Beneficial interests in the global certificate representing the notes will be shown on, and transfers will be effected only through, records maintained by DTC and its direct and indirect participants and such interests may not be exchanged for certificated notes, except in limited circumstances.

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Additional Notes
  We may, without the consent of holders of the notes, increase the principal amount of the notes by issuing additional notes in the future on the same terms and conditions, except for any difference in the issue price and interest accrued prior to the issue date of the additional notes, and with the same CUSIP number as the notes offered hereby so long as such additional notes are fungible for U.S. federal income tax purposes with the notes offered hereby.
 
   
Risk Factors
  See “Risk Factors” beginning on page 11 of this prospectus, as well as other information included in this prospectus, for a discussion of factors you should carefully consider that are relevant to an investment in the notes.

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SUMMARY HISTORICAL FINANCIAL DATA
          The following tables set forth, on a historical basis, certain summary consolidated financial and operating data for BioMed Realty, L.P. and BioMed Realty Trust, Inc. and their respective subsidiaries. You should read the following summary historical financial data in conjunction with the consolidated historical financial statements and notes thereto of each of BioMed Realty, L.P. and BioMed Realty Trust, Inc. and their respective subsidiaries and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included elsewhere in this prospectus.
BioMed Realty, L.P.
          The consolidated balance sheet data as of December 31, 2009 and 2008 and the consolidated statements of income data for each of the years in the three-year period ended December 31, 2009 have been derived from the historical consolidated financial statements of BioMed Realty, L.P. and subsidiaries, which are included in this prospectus and which have been audited by KPMG LLP, an independent registered public accounting firm, whose report with respect thereto is included elsewhere in this prospectus. The consolidated balance sheet data as of December 31, 2007, 2006 and 2005 and the consolidated statements of income data for each of the years ended December 31, 2006 and 2005 have been derived from the historical consolidated financial statements of BioMed Realty, L.P. and subsidiaries, not audited by KPMG LLP. The consolidated balance sheet data as of the six months ended June 30, 2010 and the consolidated statements of income data for each of the six months ended June 30, 2010 and 2009 have been derived from the unaudited consolidated financial statements of BioMed Realty, L.P. and subsidiaries, which are included elsewhere in this prospectus. The results for the six months ended June 30, 2010 are not necessarily indicative of the results to be expected for the full year.
                                                         
    Six Months Ended June 30,     Years Ended December 31,  
    2010     2009     2009     2008     2007     2006     2005  
(in thousands, except unit data)                                                
Statements of Income:
                                                       
Revenues:
                                                       
Total revenues
  $ 185,668     $ 180,031     $ 361,166     $ 301,973     $ 266,109     $ 218,735     $ 138,784  
 
                                         
Expenses:
                                                       
Rental operations and real estate taxes
    52,352       51,659       104,824       84,729       71,142       60,999       46,358  
Depreciation and amortization
    55,385       51,813       109,620       84,227       72,202       65,063       39,378  
General and administrative
    12,718       10,407       22,455       22,659       21,474       17,992       13,040  
Acquisition related expenses
    1,968             464       175       396       93       238  
 
                                         
Total expenses
    122,423       113,879       237,363       191,790       165,214       144,147       99,014  
 
                                         
Income from operations
    63,245       66,152       123,803       110,183       100,895       74,588       39,770  
Equity in net (loss)/income of unconsolidated partnerships
    (377 )     (766 )     (2,390 )     (1,200 )     (893 )     83       119  
Interest income
    71       164       308       485       990       1,102       1,333  
Interest expense
    (43,131 )     (24,955 )     (64,998 )     (41,172 )     (28,786 )     (40,945 )     (23,226 )
(Loss)/gain on derivative instruments
    (347 )     303       203       (19,948 )                  
(Loss)/gain on extinguishment of debt
    (2,265 )     6,152       3,264       14,783                    
 
                                         
Income from continuing operations
    17,196       47,050       60,190       63,131       72,206       34,828       17,996  
Income from discontinued operations before gain on sale of assets
                            639       1,542       57  
Gain on sale of real estate assets
                            1,087              
 
                                         
Income from discontinued operations
                            1,726       1,542       57  
 
                                         
Net income
    17,196       47,050       60,190       63,131       73,932       36,370       18,053  
Net loss/(income) attributable to noncontrolling interests
    21       30       64       9       (45 )     137       267  
 
                                         
Net income attributable to the operating partnership
    17,217       47,080       60,254       63,140       73,887       36,507       18,320  

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    Six Months Ended June 30,     Years Ended December 31,  
(in thousands, except unit data)   2010     2009     2009     2008     2007     2006     2005  
Preferred unit distributions
    (8,481 )     (8,481 )     (16,963 )     (16,963 )     (16,868 )            
 
                                         
Net income available to the unitholders
  $ 8,736     $ 38,599     $ 43,291     $ 46,177     $ 57,019     $ 36,507     $ 18,320  
 
                                         
Income from continuing operations per unit attributable to unitholders:
                                                       
Basic earnings per unit
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.80     $ 0.59     $ 0.44  
Diluted earnings per unit
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.80     $ 0.59     $ 0.43  
Net income per unit attributable to unitholders:
                                                       
Basic earnings per unit
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.83     $ 0.61     $ 0.44  
Diluted earnings per unit
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.83     $ 0.61     $ 0.44  
Weighted-average units outstanding:
                                                       
Basic
    106,890,664       87,511,810       94,005,382       74,753,230       68,219,557       58,792,539       38,913,103  
Diluted
    108,298,135       88,580,072       94,005,382       75,408,153       68,738,694       58,886,694       42,091,195  
Cash distributions declared per unit
  $ 0.29     $ 0.45     $ 0.70     $ 1.34     $ 1.24     $ 1.16     $ 1.08  
Cash distributions declared per preferred unit
  $ 0.92     $ 0.92     $ 1.84     $ 1.84     $ 1.83              
                                                         
            June 30,     December 31,  
            2010     2009     2008     2007     2006     2005  
(in thousands)                                                
Balance Sheet Data:
                                                       
Investments in real estate, net
          $ 3,075,150     $ 2,971,767     $ 2,960,429     $ 2,807,599     $ 2,457,721     $ 1,129,371  
Total assets
            3,428,221       3,283,274       3,229,314       3,058,631       2,692,572       1,337,310  
Total indebtedness
            1,284,238       1,361,805       1,341,099       1,489,585       1,329,588       513,233  
Total liabilities
            1,382,708       1,459,342       1,591,365       1,641,850       1,444,843       586,162  
Total equity
            2,045,513       1,823,932       1,637,949       1,416,781       1,247,729       751,148  
Other Data:
                                                       
Cash flows from/(used in):
                                                       
Operating activities
            63,431       145,089       115,046       114,965       101,588       54,762  
Investing activities
            (172,398 )     (157,627 )     (218,661 )     (409,301 )     (1,339,463 )     (601,805 )
Financing activities
            110,384       11,038       111,558       282,151       1,243,227       539,486  
                                                 
    Six Months        
    Ended June 30,     Year Ended December 31,  
    2010     2009     2008     2007     2006     2005  
Other Data:
                                               
Ratio of earnings to fixed charges (unaudited) (1)
    1.7       1.7       1.3       1.2       1.6       1.7  
Ratio of earnings to combined fixed charges and preferred units (unaudited)
    1.3       1.4       1.1       1.0       1.6       1.7  
 
(1)   The ratios of earnings to fixed charges are computed by dividing earnings by fixed charges. “Earnings” consist of net income (loss) before noncontrolling interests and fixed charges, and “fixed charges” consist of interest expense, capitalized interest and amortization of deferred financing fees, whether expensed or capitalized, and interest within rental expense.

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BioMed Realty Trust, Inc.
          The consolidated balance sheet data as of December 31, 2009 and 2008 and the consolidated statements of income for each of the years in the three-year period ended December 31, 2009 have been derived from the historical consolidated financial statements of BioMed Realty Trust, Inc. and subsidiaries, which are included in this prospectus and which have been audited by KPMG LLP, an independent registered public accounting firm, whose report with respect thereto is included elsewhere in this prospectus. The consolidated balance sheet data as of December 31, 2007 and the consolidated statements of income data for the year ended December 31, 2006 have been derived from the historical consolidated financial statements of BioMed Realty Trust, Inc. and subsidiaries, audited by KPMG LLP, whose report with respect thereto is not included or incorporated by reference in this prospectus. The consolidated balance sheet data as of December 31, 2006 and 2005 and the consolidated statements of income data for the year ended December 31, 2005 have been derived from the historical consolidated financial statements of BioMed Realty Trust, Inc. and subsidiaries, not audited by KPMG LLP. The consolidated balance sheet data and consolidated statements of income data as of and for each of the six months ended June 30, 2010 and 2009 have been derived from the unaudited consolidated financial statements of BioMed Realty Trust, Inc. and subsidiaries, which are included elsewhere in this prospectus. The results for the six months ended June 30, 2010 are not necessarily indicative of the results to be expected for the full year. Certain prior year amounts have been reclassified to conform to the current year presentation.
                                                         
    Six Months Ended June 30,     Years Ended December 31,  
    2010     2009     2009     2008     2007     2006     2005  
(in thousands, except share data)                                                  
Statements of Income:
                                                       
Revenues:
                                                       
Total revenues
  $ 185,668     $ 180,031     $ 361,166     $ 301,973     $ 266,109     $ 218,735     $ 138,784  
 
                                         
Expenses:
                                                       
Rental operations and real estate taxes
    52,352       51,659       104,824       84,729       71,142       60,999       46,358  
Depreciation and amortization
    55,385       51,813       109,620       84,227       72,202       65,063       39,378  
General and administrative
    12,718       10,407       22,455       22,659       21,474       17,992       13,040  
Acquisition related expenses
    1,968             464       175       396       93       238  
 
                                         
Total expenses
    122,423       113,879       237,363       191,790       165,214       144,147       99,014  
 
                                         
Income from operations
    63,245       66,152       123,803       110,183       100,895       74,588       39,770  
Equity in net (loss)/income of unconsolidated partnerships
    (377 )     (766 )     (2,390 )     (1,200 )     (893 )     83       119  
Interest income
    71       164       308       485       990       1,102       1,333  
Interest expense
    (43,131 )     (24,955 )     (64,998 )     (41,172 )     (28,786 )     (40,945 )     (23,226 )
(Loss)/gain on derivative instruments
    (347 )     303       203       (19,948 )                  
(Loss)/gain on extinguishment of debt
    (2,265 )     6,152       3,264       14,783                    
 
                                         
Income from continuing operations
    17,196       47,050       60,190       63,131       72,206       34,828       17,996  
Income from discontinued operations before gain on sale of assets
                            639       1,542       57  
Gain on sale of real estate assets
                            1,087              
 
                                         
Income from discontinued operations
                            1,726       1,542       57  
 
                                         
Net income
    17,196       47,050       60,190       63,131       73,932       36,370       18,053  
Net income attributable to noncontrolling interests
    (216 )     (1,350 )     (1,468 )     (2,077 )     (2,531 )     (1,610 )     (1,007 )
 
                                         
Net income attributable to the Company
    16,980       45,700       58,722       61,054       71,401       34,760       17,046  
Preferred stock dividends
    (8,481 )     (8,481 )     (16,963 )     (16,963 )     (16,868 )            
 
                                         
Net income available to common stockholders
  $ 8,499     $ 37,219     $ 41,759     $ 44,091     $ 54,533     $ 34,760     $ 17,046  
 
                                         

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    Six Months Ended June 30,     Years Ended December 31,  
(in thousands, except share data)   2010     2009     2009     2008     2007     2006     2005  
Income from continuing operations per share available to common stockholders:
                                                       
Basic earnings per share
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.81     $ 0.59     $ 0.44  
Diluted earnings per share
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.80     $ 0.59     $ 0.43  
Net income per share available to common stockholders:
                                                       
Basic earnings per share
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.83     $ 0.61     $ 0.44  
Diluted earnings per share
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.83     $ 0.61     $ 0.44  
Weighted-average common shares outstanding:
                                                       
Basic
    104,000,339       84,403,582       91,011,123       71,684,244       65,303,204       55,928,975       38,913,103  
Diluted
    108,298,135       88,580,072       91,851,002       75,408,153       68,738,694       58,886,694       42,091,195  
Cash dividends declared per common share
  $ 0.29     $ 0.45     $ 0.70     $ 1.34     $ 1.24     $ 1.16     $ 1.08  
Cash dividends declared per preferred share
  $ 0.92     $ 0.92     $ 1.84     $ 1.84     $ 1.83              
                                                         
            June 30,     December 31,  
            2010     2009     2008     2007     2006     2005  
(in thousands)                                                  
Balance Sheet Data:
                                                       
Investments in real estate, net
          $ 3,075,150     $ 2,971,767     $ 2,960,429     $ 2,807,599     $ 2,457,721     $ 1,129,371  
Total assets
            3,428,221       3,283,274       3,229,314       3,058,631       2,692,572       1,337,310  
Total indebtedness
            1,284,238       1,361,805       1,341,099       1,489,585       1,329,588       513,233  
Total liabilities
            1,382,708       1,459,342       1,591,365       1,641,850       1,444,843       586,162  
Total equity
            2,045,513       1,823,932       1,637,949       1,416,781       1,247,729       751,148  
Other Data:
                                                       
Cash flows from/(used in):
                                                       
Operating activities
            63,431       145,089       115,046       114,965       101,588       54,762  
Investing activities
            (172,398 )     (157,627 )     (218,661 )     (409,301 )     (1,339,463 )     (601,805 )
Financing activities
            110,384       11,038       111,558       282,151       1,243,227       539,486  
                                                 
    Six Months        
    Ended June 30,     Year Ended December 31,  
    2010     2009     2008     2007     2006     2005  
Other Data:
                                               
Ratio of earnings to fixed charges (unaudited) (1)
    1.7       1.7       1.3       1.2       1.6       1.7  
Ratio of earnings to combined fixed charges and preferred units (unaudited)
    1.3       1.4       1.1       1.0       1.6       1.7  
 
(1)   The ratios of earnings to fixed charges are computed by dividing earnings by fixed charges. “Earnings” consist of net income (loss) before noncontrolling interests and fixed charges, and “fixed charges” consist of interest expense, capitalized interest and amortization of deferred financing fees, whether expensed or capitalized, and interest within rental expense.

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RISK FACTORS
          You should carefully consider the risks described below as well as other information and data included in this prospectus before making a decision to exchange your private notes for the exchange notes in the exchange offer. If any of the events described in the risk factors below occur, our business, financial condition, operating results and prospects could be materially adversely affected, which in turn could adversely affect our ability to repay the notes. The risk factors set forth below are generally applicable to the private notes as well as the exchange notes.
Risks Related to Our Properties, Our Business and Our Growth Strategy
          Because we lease our properties to a limited number of tenants, and to the extent we depend on a limited number of tenants in the future, the inability of any single tenant to make its lease payments could adversely affect our business and our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          As of June 30, 2010, we had 123 tenants in 73 total properties. Two of our tenants, Human Genome Sciences and Vertex Pharmaceuticals, represented 13.7% and 9.3%, respectively, of our annualized base rent as of June 30, 2010, and 10.9% and 8.1%, respectively, of our total leased rentable square footage. While we evaluate the creditworthiness of our tenants by reviewing available financial and other pertinent information, there can be no assurance that any tenant will be able to make timely rental payments or avoid defaulting under its lease. If a tenant defaults, we may experience delays in enforcing our rights as landlord and may incur substantial costs in protecting our investment.
          In addition, certain of our life science tenants are development stage companies, which have a history of recurring losses from operations as they have devoted substantially all of their efforts to developing and completing clinical trials for various drug candidates. The development and approval process for these drug candidates is uncertain and lengthy, and often requires significant external access to capital. The sources of this capital have historically included the capital markets; funding through private and public agencies; and partnering, licensing and other arrangements with larger pharmaceutical, healthcare and biotechnology companies. The current economic environment has significantly impacted the ability of these companies to access the capital markets, including both equity financing through public offerings and debt financing. The pace of venture capital funding has also declined from previous levels, further restricting access to capital for these companies. In addition, state and federal government budgets have been negatively impacted by the current economic environment and, as a result certain programs, including grants related to biotechnology research and development, may be at risk of being eliminated or cut back significantly. Furthermore, partnering opportunities with more established companies, as well as governmental agency and university grants, have become more limited in the current economic environment. If funding sources for these companies remain significantly constrained, these companies may be forced to curtail or suspend their operations, and may default on their obligations to third parties, including their obligations to pay rent or pay for tenant improvements relating to space they lease.
          Our revenue and cash flow, and consequently our ability to satisfy our debt service obligations, including the notes, and make distributions to BioMed Realty, L.P.’s unitholders and BioMed Realty Trust, Inc.’s stockholders, could be materially adversely affected if any of our significant tenants were to become bankrupt or insolvent, suffer a downturn in their business, curtail or suspend their operations, or fail to renew their leases at all or renew on terms less favorable to us than their current terms.
          Tenants in the life science industry face high levels of regulation, expense and uncertainty that may adversely affect their ability to pay us rent and consequently adversely affect our business.
          Life science entities comprise the vast majority of our tenant base. Because of our dependence on a single industry, adverse conditions affecting that industry will more adversely affect our business, and thus our ability to make distributions to our stockholders, than if our business strategy included a more diverse tenant base. Life science industry tenants, particularly those involved in developing and marketing drugs and drug delivery technologies, fail from time to time as a result of various factors. Many of these factors are particular to the life science industry. For example:
    As discussed above, our tenants require significant outlays of funds for the research and development and clinical testing of their products and technologies. If private investors, the government, public markets or other sources of funding are unavailable to support such development, a tenant’s business may fail.
 
    The research and development, clinical testing, manufacture and marketing of some of our tenants’ products require federal, state and foreign regulatory approvals. The approval process is typically long, expensive and uncertain. Even if our tenants have sufficient funds to seek approvals, one or all of their products may fail to obtain the required regulatory approvals on a timely basis or at all. Furthermore, our tenants may only have a small number of products under development. If one product fails to receive the required approvals at any stage of development, it could significantly adversely affect our tenant’s entire business and its ability to pay rent.

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    Our tenants with marketable products may be adversely affected by health care reform efforts and the reimbursement policies of government or private health care payers.
 
    Our tenants may be unable to adequately protect their intellectual property under patent, copyright or trade secret laws. Failure to do so could jeopardize their ability to profit from their efforts and to protect their products from competition.
 
    Collaborative relationships with other life science entities may be crucial to the development, manufacturing, distribution or marketing of our tenants’ products. If these other entities fail to fulfill their obligations under these collaborative arrangements, our tenants’ businesses will suffer.
          In the United States, at both the federal and state levels, the government regularly considers legislation to reform health care and its cost, and such proposals have received increasing political attention. Congress has passed legislation to reform the U.S. health care system by expanding health insurance coverage, reducing health care costs and making other changes. While health care reform may increase the number of patients who have insurance coverage for many of our tenants’ marketable products, it may also include government intervention in product pricing and other changes that adversely affect reimbursement for those products. Sales of many of our tenants’ marketable products are dependent, in large part, on the availability and extent of reimbursement from government health administration authorities, private health insurers and other organizations. Changes in government regulations, price controls or third-party payors’ reimbursement policies may reduce reimbursement for our tenants’ marketable products and adversely impact our tenants’ businesses.
          We cannot assure you that our tenants in the life science industry will be successful in their businesses. If our tenants’ businesses are adversely affected, they may have difficulty paying us rent or paying for tenant improvements relating to space they lease.
          The bankruptcy of a tenant may adversely affect the income produced by and the value of our properties.
          The bankruptcy or insolvency of a tenant may adversely affect the income produced by our properties. If any tenant becomes a debtor in a case under the Bankruptcy Code, we cannot evict the tenant solely because of the bankruptcy. The bankruptcy court also might authorize the tenant to reject and terminate its lease with us, which would generally result in any unpaid, pre-bankruptcy rent being treated as an unsecured claim. An unsecured claim may be paid only to the extent that funds are available and only in the same percentage as is paid to all other holders of unsecured claims. In addition, our claim against the tenant for unpaid, future rent would be subject to a statutory cap equal to the greater of (1) one year of rent or (2) 15% of the remaining rent on the lease (not to exceed three years of rent). This cap might be substantially less than the remaining rent actually owed under the lease. Additionally, a bankruptcy court may require us to turn over to the estate all or a portion of any deposits, amounts in escrow, or prepaid rents. Our claim for unpaid, pre-bankruptcy rent, our lease termination damages and claims relating to damages for which we hold deposits or other amounts that we were forced to repay would likely not be paid in full.
          We may be unable to acquire, develop or operate new properties successfully, which could harm our financial condition and ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          We continue to evaluate the market for available properties and may acquire office, laboratory and other properties when opportunities exist. We also may develop or substantially renovate office and other properties. Acquisition, development and renovation activities are subject to significant risks, including:
    we may be unable to obtain financing on favorable terms (or at all), including continued access to our unsecured line of credit,
 
    changing market conditions, including competition from others, may diminish our opportunities for acquiring a desired property on favorable terms or at all. Even if we enter into agreements for the acquisition of properties, these agreements are subject to customary conditions to closing, including completion of due diligence investigations to our satisfaction,
 
    we may spend more time or money than we budget to improve or renovate acquired properties or to develop new properties,

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    we may be unable to quickly and efficiently integrate new properties, particularly if we acquire portfolios of properties, into our existing operations,
 
    we may fail to obtain the financial results expected from the properties we acquire or develop, making them unprofitable or less profitable than we had expected,
 
    market and economic conditions may result in higher than expected vacancy rates and lower than expected rental rates,
 
    we may fail to retain tenants that have pre-leased our properties under development if we do not complete the construction of these properties in a timely manner or to the tenants’ specifications,
 
    we have a limited history in conducting ground-up construction activities,
 
    if we develop properties, we may encounter delays or refusals in obtaining all necessary zoning, land use, building, occupancy and other required governmental permits and authorizations,
 
    acquired and developed properties may have defects we do not discover through our inspection processes, including latent defects that may not reveal themselves until many years after we put a property in service, and
 
    we may acquire land, properties or entities owning properties, which are subject to liabilities and for which, in the case of unknown liabilities, we may have limited or no recourse.
          The realization of any of the above risks could significantly and adversely affect our financial condition, results of operations, cash flow, per share trading price of our securities, ability to satisfy our debt service obligations, including the notes, and ability to pay distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          Because particular upgrades are required for life science tenants, improvements to our properties involve greater expenditures than traditional office space, which costs may not be covered by the rents our tenants pay.
          The improvements generally required for our properties’ infrastructure are more costly than for other property types. Typical infrastructural improvements include the following:
    reinforced concrete floors,
 
    upgraded roof structures for greater load capacity,
 
    increased floor-to-ceiling clear heights,
 
    heavy-duty HVAC systems,
 
    enhanced environmental control technology,
 
    significantly upgraded electrical, gas and plumbing infrastructure, and
 
    laboratory benchwork.
          Our tenants generally pay higher rent on our properties than tenants in traditional office space. However, we cannot assure you that our tenants will continue to do so in the future or that the rents paid will cover the additional costs of upgrading the properties.
          Because of the unique and specific improvements required for our life science tenants, we may be required to incur substantial renovation costs to make our properties suitable for other life science tenants or other office tenants, which could adversely affect our operating performance.
          We acquire or develop properties that include laboratory space and other features that we believe are generally desirable for life science industry tenants. However, different life science industry tenants may require different features in their properties, depending on each tenant’s particular focus within the life science industry. If a current tenant is unable to pay rent and vacates a property, we may incur substantial expenditures to modify the property before we are able to re-lease the space to another life science industry tenant. This could hurt our operating performance and the value of your investment. Also, if the property needs to be renovated to accommodate multiple tenants, we may incur substantial expenditures before we are able to re-lease the space.

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          Additionally, our properties may not be suitable for lease to traditional office tenants without significant expenditures or renovations. Accordingly, any downturn in the life science industry may have a substantial negative impact on our properties’ values.
          Our success depends on key personnel with extensive experience dealing with the real estate needs of life science tenants, and the loss of these key personnel could threaten our ability to operate our business successfully.
          Our future success depends, to a significant extent, on the continued services of our management team. In particular, we depend on the efforts of Alan D. Gold, our Chairman and Chief Executive Officer, R. Kent Griffin, Jr., our President and Chief Operating Officer, Greg N. Lubushkin, our Chief Financial Officer, Gary A. Kreitzer, our Executive Vice President and General Counsel, and Matthew G. McDevitt, our Executive Vice President, Real Estate. Among the reasons that Messrs. Gold, Griffin, Lubushkin, Kreitzer and McDevitt are important to our success are that they have extensive real estate and finance experience, and strong reputations within the life science industry. Our management team has developed informal relationships through past business dealings with numerous members of the scientific community, life science investors, current and prospective life science industry tenants, and real estate brokers. We expect that their reputations will continue to attract business and investment opportunities before the active marketing of properties and will assist us in negotiations with lenders, existing and potential tenants, and industry personnel. If we lost their services, our relationships with such lenders, existing and prospective tenants, and industry personnel could suffer. We have entered into employment agreements with each of Messrs. Gold, Griffin, Kreitzer and McDevitt, but we cannot guarantee that they will not terminate their employment prior to the end of the term.
          We face risks associated with property acquisitions.
          In addition to the 13 properties we acquired in connection with our initial public offering in August 2004, as of June 30, 2010, we had acquired or had acquired an interest in an additional 60 properties (net of property dispositions). We continue to evaluate the market of available properties and may acquire properties when strategic opportunities exist. We may not be able to quickly and efficiently integrate any properties that we acquire into our organization and manage and lease the new properties in a way that allows us to realize the financial returns that we expect. In addition, we may incur unanticipated costs to make necessary improvements or renovations to acquired properties. Furthermore, our efforts to integrate new property acquisitions may divert management’s attention away from or cause disruptions to the operations at our existing properties. If we fail to successfully operate new acquisitions or integrate them into our portfolio, or if newly acquired properties fail to perform as we expect, our results of operations, financial condition and ability to service our debt obligations or to pay distributions could suffer.
          The geographic concentration of our properties in Boston, Maryland and California makes our business particularly vulnerable to adverse conditions affecting these markets.
          Eighteen of our properties are located in the Boston area. As of June 30, 2010, these properties represented 38.8% of our annualized base rent and 27.3% of our total leased square footage. Eight of our properties are located in Maryland. As of June 30, 2010, these properties represented 17.4% of our annualized base rent and 17.8% of our total leased square footage. In addition, 28 of our properties are located in California, with 17 in San Diego and eleven in San Francisco. As of June 30, 2010, these properties represented 22.7% of our annualized base rent and 29.5% of our total leased square footage. Because of this concentration in three geographic regions, we are particularly vulnerable to adverse conditions affecting Boston, Maryland and California, including general economic conditions, increased competition, a downturn in the local life science industry, real estate conditions, terrorist attacks, earthquakes and wildfires and other natural disasters occurring in these regions. In addition, we cannot assure you that these markets will continue to grow or remain favorable to the life science industry. The performance of the life science industry and the economy in general in these geographic markets may affect occupancy, market rental rates and expenses, and thus may affect our performance and the value of our properties. We are also subject to greater risk of loss from earthquakes or wildfires because of our properties’ concentration in California. The close proximity of our eleven properties in San Francisco to a fault line makes them more vulnerable to earthquakes than properties in many other parts of the country. Likewise, the wildfires occurring in the San Diego area, most recently in 2003 and in 2007, may make the 16 properties we own in the San Diego area more vulnerable to fire damage or destruction than properties in many other parts of the country.
          Our tax indemnification and debt maintenance obligations require us to make payments if we sell certain properties or repay certain debt, which could limit our operating flexibility.
          In our formation transactions, certain of our executive officers, Messrs. Gold, Kreitzer and McDevitt, and certain other individuals contributed six properties to BioMed Realty, L.P. If we were to dispose of these contributed assets in a taxable transaction, Messrs. Gold, Kreitzer and McDevitt and the other contributors of those assets would suffer adverse tax consequences. In connection with these contribution transactions, we agreed to indemnify those contributors against such adverse tax consequences for a period of

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ten years. This indemnification will help those contributors to preserve their tax positions after their contributions. The tax indemnification provisions were not negotiated in an arm’s length transaction but were determined by our management team. We have also agreed to use reasonable best efforts consistent with our fiduciary duties to maintain at least $8.0 million of debt, some of which must be property specific, that the contributors can guarantee in order to defer any taxable gain they may incur if our operating partnership repays existing debt. These tax indemnification and debt maintenance obligations may affect the way in which we conduct our business. During the indemnification period, these obligations may impact the timing and circumstances under which we sell the contributed properties or interests in entities holding the properties. For example, these tax indemnification payments could effectively reduce or eliminate any gain we might otherwise realize upon the sale or other disposition of the related properties. Accordingly, even if market conditions might otherwise dictate that it would be desirable to dispose of these properties, the existence of the tax indemnification obligations could result in a decision to retain the properties in our portfolio to avoid having to pay the tax indemnity payments. The existence of the debt maintenance obligations could require us to maintain debt at a higher level than we might otherwise choose. Higher debt levels could adversely affect our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          While we may seek to enter into tax-efficient joint ventures with third-party investors, we currently have no intention of disposing of these properties or interests in entities holding the properties in transactions that would trigger our tax indemnification obligations. The involuntary condemnation of one or more of these properties during the indemnification period could, however, trigger the tax indemnification obligations described above. The tax indemnity would equal the amount of the federal and state income tax liability the contributor would incur with respect to the gain allocated to the contributor. The calculation of the indemnity payment would not be reduced due to the time value of money or the time remaining within the indemnification period. The terms of the contribution agreements also require us to gross up the tax indemnity payment for the amount of income taxes due as a result of the tax indemnity payment. Messrs. Gold, Kreitzer and McDevitt are potential recipients of these indemnification payments. Because of these potential payments, their personal interests may diverge from those of our unitholders or stockholders.
          Future acts of terrorism or war or the risk of war may have a negative impact on our business.
          The continued threat of terrorism and the potential for military action and heightened security measures in response to this threat may cause significant disruption to commerce. There can be no assurance that the armed hostilities will not escalate or that these terrorist attacks, or the United States’ responses to them, will not lead to further acts of terrorism and civil disturbances, which may further contribute to economic instability. Any armed conflict, civil unrest or additional terrorist activities, and the attendant political instability and societal disruption, may adversely affect our results of operations, financial condition and future growth.
Risks Related to the Real Estate Industry
          Our performance and value are subject to risks associated with the ownership and operation of real estate assets and with factors affecting the real estate industry.
          Our ability to make expected payments with respect to the notes and distributions to BioMed Realty, L.P.’s unitholders and BioMed Realty Trust, Inc.’s stockholders depends on our ability to generate revenues in excess of expenses, our scheduled principal payments on debt and our capital expenditure requirements. Events and conditions that are beyond our control may decrease our cash available for distribution and payment with respect to the notes and the value of our properties. These events include:
    local oversupply, increased competition or reduced demand for life science office and laboratory space,
 
    inability to collect rent from tenants,
 
    vacancies or our inability to rent space on favorable terms,
 
    increased operating costs, including insurance premiums, utilities and real estate taxes,
 
    the ongoing need for capital improvements, particularly in older structures,
 
    unanticipated delays in the completion of our development or redevelopment projects,
 
    costs of complying with changes in governmental regulations, including usage, zoning, environmental and tax laws,
 
    the relative illiquidity of real estate investments,
 
    changing submarket demographics, and
 
    civil unrest, acts of war and natural disasters, including earthquakes, floods and fires, which may result in uninsured and underinsured losses.

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          In addition, we could experience a general decline in rents or an increased incidence of defaults under existing leases if any of the following occur:
    the continuation or worsening of the current economic environment,
 
    future periods of economic slowdown or recession,
 
    rising interest rates,
 
    declining demand for real estate, or
 
    the public perception that any of these events may occur.
          Any of these events could adversely affect our financial condition, results of operations, cash flow, per share trading price of BioMed Realty Trust, Inc.’s common stock or preferred stock, ability to satisfy our debt service obligations, including the notes, and ability to pay distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          Illiquidity of real estate investments may make it difficult for us to sell properties in response to market conditions and could harm our financial condition and ability to make distributions.
          Equity real estate investments are relatively illiquid and therefore will tend to limit our ability to vary our portfolio promptly in response to changing economic or other conditions. To the extent the properties are not subject to triple-net leases, some significant expenditures such as real estate taxes and maintenance costs are generally not reduced when circumstances cause a reduction in income from the investment. Should these events occur, our income and funds available for distribution could be adversely affected. If any of the parking leases or licenses associated with our Cambridge portfolio were to expire, or if we were unable to assign these leases to a buyer, it would be more difficult for us to sell these properties and would adversely affect our ability to retain current tenants or attract new tenants at these properties. In addition, as a REIT, BioMed Realty Trust, Inc. may be subject to a 100% tax on net income derived from the sale of property considered to be held primarily for sale to customers in the ordinary course of our business. We may seek to avoid this tax by complying with certain safe harbor rules that generally limit the number of properties we may sell in a given year, the aggregate expenditures made on such properties prior to their disposition, and how long we retain such properties before disposing of them. However, we can provide no assurance that we will always be able to comply with these safe harbors. If compliance is possible, the safe harbor rules may restrict our ability to sell assets in the future and achieve liquidity that may be necessary to fund distributions.
          We may be unable to renew leases, lease vacant space or re-lease space as leases expire, which could adversely affect our business and our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          If we cannot renew leases, we may be unable to re-lease our properties at rates equal to or above the current rate. Even if we can renew leases, tenants may be able to negotiate lower rates as a result of market conditions. Market conditions may also hinder our ability to lease vacant space in newly developed or redeveloped properties. In addition, we may enter into or acquire leases for properties that are specially suited to the needs of a particular tenant. Such properties may require renovations, tenant improvements or other concessions in order to lease them to other tenants if the initial leases terminate. Any of these factors could adversely impact our financial condition, results of operations, cash flow, per share trading price of BioMed Realty Trust, Inc.’s common stock or preferred stock, our ability to satisfy our debt service obligations, including the notes, and our ability to pay distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          Significant competition may decrease or prevent increases in our properties’ occupancy and rental rates and may reduce our investment opportunities.
          We face competition from various entities for investment opportunities in properties for life science tenants, including other REITs, such as health care REITs and suburban office property REITs, pension funds, insurance companies, investment funds and companies, partnerships, and developers. Many of these entities have substantially greater financial resources than we do and may be able to accept more risk than we can prudently manage, including risks with respect to the creditworthiness of a tenant or the geographic location of its investments. In the future, competition from these entities may reduce the number of suitable investment opportunities offered to us or increase the bargaining power of property owners seeking to sell. Further, as a result of their greater resources, those entities may have more flexibility than we do in their ability to offer rental concessions to attract tenants. This could put pressure on our ability to maintain or raise rents and could adversely affect our ability to attract or retain tenants. As a result, our financial condition, results of operations, cash flow, per share trading price of BioMed Realty Trust, Inc.’s common stock or preferred stock, ability to satisfy our debt service obligations, including the notes, and ability to pay distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders may be adversely affected.

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          Uninsured and underinsured losses could adversely affect our operating results and our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          We carry comprehensive general liability, fire and extended coverage, terrorism and loss of rental income insurance covering all of our properties under a blanket portfolio policy, with the exception of property insurance on our McKellar Court, Science Center Drive, 9911 Belward Campus Drive and Shady Grove Road locations, which is carried directly by the tenants in accordance with the terms of their respective leases, and builders’ risk policies for any projects under construction. In addition, we carry workers’ compensation coverage for injury to our employees. We believe the policy specifications and insured limits are adequate given the relative risk of loss, cost of the coverage and standard industry practice. We also carry environmental remediation insurance for our properties. This insurance, subject to certain exclusions and deductibles, covers the cost to remediate environmental damage caused by unintentional future spills or the historic presence of previously undiscovered hazardous substances, as well as third-party bodily injury and property damage claims related to the release of hazardous substances. We intend to carry similar insurance with respect to future acquisitions as appropriate. A substantial portion of our properties are located in areas subject to earthquake loss, such as San Diego and San Francisco, California and Seattle, Washington. Although we presently carry earthquake insurance on our properties, the amount of earthquake insurance coverage we carry may not be sufficient to fully cover losses from earthquakes. In addition, we may discontinue earthquake, terrorism or other insurance, or may elect not to procure such insurance, on some or all of our properties in the future if the cost of the premiums for any of these policies exceeds, in our judgment, the value of the coverage discounted for the risk of loss.
          If we experience a loss that is uninsured or that exceeds policy limits, we could lose the capital invested in the damaged properties as well as the anticipated future cash flows from those properties. In addition, if the damaged properties are subject to recourse indebtedness, we would continue to be liable for the indebtedness, even if these properties were irreparably damaged.
          While we evaluate the credit ratings of each of our insurance companies at the time we enter into or renew our policies, the financial condition of one or more of these insurance companies could significantly deteriorate to the point that they may be unable to pay future insurance claims. This risk has increased as a result of the current economic environment and ongoing disruptions in the financial markets. The inability of any of these insurance companies to pay future claims under our policies may adversely affect our financial condition and results of operations.
          We could incur significant costs related to government regulation and private litigation over environmental matters involving the presence, discharge or threat of discharge of hazardous or toxic substances, which could adversely affect our operations, the value of our properties, and our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          Our properties may be subject to environmental liabilities. Under various federal, state and local laws, a current or previous owner, operator or tenant of real estate can face liability for environmental contamination created by the presence, discharge or threat of discharge of hazardous or toxic substances. Liabilities can include the cost to investigate, clean up and monitor the actual or threatened contamination and damages caused by the contamination (or threatened contamination). Environmental laws typically impose such liability on the current owner regardless of:
    the owner’s knowledge of the contamination,
 
    the timing of the contamination,
 
    the cause of the contamination, or
 
    the party responsible for the contamination.
          The liability under such laws may be strict, joint and several, meaning that we may be liable regardless of whether we knew of, or were responsible for, the presence of the contaminants, and the government entity or private party may seek recovery of the entire amount from us even if there are other responsible parties. Liabilities associated with environmental conditions may be significant and can sometimes exceed the value of the affected property. The presence of hazardous substances on a property may adversely affect our ability to sell or rent that property or to borrow using that property as collateral.

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          Some of our properties have had contamination in the past that required cleanup. In most cases, we believe the contamination has been effectively remediated, and that any remaining contamination either does not require remediation or that the costs associated with such remediation will not be material to us. However, we cannot guarantee that additional contamination will not be discovered in the future or any identified contamination will not continue to pose a threat to the environment or that we will not have continued liability in connection with such prior contamination. Our Kendall Square properties, in Cambridge, Massachusetts, are located on the site of a former manufactured gas plant. Various remedial actions were performed on these properties, including soil stabilization to control the spread of oil and hazardous materials in the soil. Another of our properties, Elliott Avenue, has known soil contamination beneath a portion of the building located on the property. Based on environmental consultant reports, management does not believe any remediation of the Elliott Avenue property would be required unless major structural changes were made to the building that resulted in the soil becoming exposed. In addition, the remediation of certain environmental conditions at off-site parcels located in Cambridge, Massachusetts, which was an assumed obligation of our joint venture, PREI II LLC, has been substantially completed as of December 31, 2009. We do not expect these matters to materially adversely affect such properties’ value or the cash flows related to such properties, but we can provide no assurances to that effect.
          Environmental laws also:
    may require the removal or upgrade of underground storage tanks,
 
    regulate the discharge of storm water, wastewater and other pollutants,
 
    regulate air pollutant emissions,
 
    regulate hazardous materials generation, management and disposal, and
 
    regulate workplace health and safety.
          Life science industry tenants, our primary tenant industry focus, frequently use hazardous materials, chemicals, heavy metals, and biological and radioactive compounds. Our tenants’ controlled use of these materials subjects us and our tenants to laws that govern using, manufacturing, storing, handling and disposing of such materials and certain byproducts of those materials. We are unaware of any of our existing tenants violating applicable laws and regulations, but we and our tenants cannot completely eliminate the risk of contamination or injury from these materials. If our properties become contaminated, or if a party is injured, we could be held liable for any damages that result. Such liability could exceed our resources and any environmental remediation insurance coverage we have, which could adversely affect our operations, the value of our properties, and our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders. Licensing requirements governing use of radioactive materials by tenants may also restrict the use of or ability to transfer space in buildings we own.
          We could incur significant costs related to governmental regulation and private litigation over environmental matters involving asbestos-containing materials, which could adversely affect our operations, the value of our properties, and our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          Environmental laws also govern the presence, maintenance and removal of asbestos-containing materials, or ACMs, and may impose fines and penalties, including orders prohibiting the use of the affected property by us or our tenants, if we fail to comply with these requirements. Failure to comply with these laws, or even the presence of ACMs, may expose us to third-party liability. Some of our properties contain ACMs, and we could be liable for such fines or penalties, as described below in “Business and Properties — Regulation — Environmental Matters.”
          Our properties may contain or develop harmful mold, which could lead to liability for adverse health effects and costs of remediating the problem, which could adversely affect the value of the affected property and our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          When excessive moisture accumulates in buildings or on building materials, mold growth may occur, particularly if the moisture problem remains undiscovered or is not addressed over a period of time. Some molds may produce airborne toxins or irritants. Concern about indoor exposure to mold has been increasing because exposure to mold may cause a variety of adverse health effects and symptoms, including allergic or other reactions. As a result, the presence of significant mold at any of our properties could require us to undertake a costly remediation program to contain or remove the mold from the affected property. In addition, the presence of significant mold could expose us to liability to our tenants, their or our employees, and others if property damage or health concerns arise.

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          Compliance with the Americans with Disabilities Act and similar laws may require us to make significant unanticipated expenditures.
          All of our properties are required to comply with the ADA. The ADA requires that all public accommodations must meet federal requirements related to access and use by disabled persons. Although we believe that our properties substantially comply with present requirements of the ADA, we have not conducted an audit of all of such properties to determine compliance. If one or more properties are not in compliance with the ADA, then we would be required to bring the non-compliant properties into compliance. Compliance with the ADA could require removing access barriers. Non-compliance could result in imposition of fines by the U.S. government or an award of damages and/or attorneys’ fees to private litigants, or both. Additional federal, state and local laws also may require us to modify properties or could restrict our ability to renovate properties. Complying with the ADA or other legislation could be very expensive. If we incur substantial costs to comply with such laws, our financial condition, results of operations, cash flow, per share trading price of BioMed Realty Trust, Inc.’s common stock or preferred stock, our ability to satisfy our debt service obligations, including the notes, and our ability to pay distributions BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders could be adversely affected.
          We may incur significant unexpected costs to comply with fire, safety and other regulations, which could adversely impact our financial condition, results of operations, and ability to make distributions.
          Our properties are subject to various federal, state and local regulatory requirements, such as state and local fire and safety requirements, building codes and land use regulations. Failure to comply with these requirements could subject us to governmental fines or private litigant damage awards. We believe that our properties are currently in material compliance with all applicable regulatory requirements. However, we do not know whether existing requirements will change or whether future requirements, including any requirements that may emerge from pending or future climate change legislation, will require us to make significant unanticipated expenditures that will adversely impact our financial condition, results of operations, cash flow, the per share trading price of BioMed Realty Trust, Inc.’s common stock or preferred stock, our ability to satisfy our debt service obligations, including the notes, and our ability to pay distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
Risks Related to Our Capital Structure
          A downgrade in our investment grade credit rating could materially adversely affect our business and financial condition.
          In April 2010, we received investment grade corporate credit ratings and the notes received an investment grade rating from two ratings agencies. We plan to manage our operations to maintain investment grade status with a capital structure consistent with our current profile, but there can be no assurance that we will be able to maintain our current credit ratings. Any downgrades in terms of ratings or outlook by either or both of the noted rating agencies could have a material adverse impact on our cost and availability of capital, which could in turn have a material adverse impact on our financial condition, results of operations and liquidity and a material adverse effect on the market price of BioMed Realty Trust, Inc.’s common stock or the trading prices of the notes.
          Debt obligations expose us to increased risk of property losses and may have adverse consequences on our business operations and our ability to make distributions.
          We have used and will continue to use debt to finance property acquisitions. Our use of debt may have adverse consequences, including the following:
    We may not be able to refinance or extend our existing debt. If we cannot repay, refinance or extend our debt at maturity, in addition to our failure to repay our debt, we may be unable to make distributions to our stockholders at expected levels or at all.
 
    Even if we are able to refinance or extend our existing debt, the terms of any refinancing or extension may not be as favorable as the terms of our existing debt. If the refinancing involves a higher interest rate, it could adversely affect our cash flow and ability to make distributions to stockholders.
 
    One or more lenders under our $720.0 million unsecured line of credit could refuse to fund their financing commitment to us or could fail, and we may not be able to replace the financing commitment of any such lenders on favorable terms, or at all.
 
    Required payments of principal and interest may be greater than our cash flow from operations.

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    We may be forced to dispose of one or more of our properties, possibly on disadvantageous terms, to make payments on our debt.
 
    If we default on our debt obligations, the lenders or mortgagees may foreclose on our properties that secure those loans. Further, if we default under a mortgage loan, we will automatically be in default on any other loan that has cross-default provisions, and we may lose the properties securing all of these loans.
 
    A foreclosure on one of our properties will be treated as a sale of the property for a purchase price equal to the outstanding balance of the secured debt. If the outstanding balance of the secured debt exceeds our tax basis in the property, we would recognize taxable income on foreclosure without realizing any accompanying cash proceeds to pay the tax (or to make distributions based on REIT taxable income).
          As of June 30, 2010, in addition to the $250.0 million outstanding principal amount of the notes, we had outstanding mortgage indebtedness of $658.8 million, excluding $6.0 million of debt premium; $21.9 million of outstanding aggregate principal amount of 4.50% exchangeable senior notes due 2026 (the Notes due 2026), excluding $504,000 of debt discount; $180.0 million of outstanding aggregate principal amount of 3.75% exchangeable senior notes due 2030 (the Notes due 2030 and, together with the Notes due 2026, the Exchangeable Notes); $170.5 million in outstanding borrowings under our $720.0 million unsecured line of credit; and $40.7 million and $39.4 million of borrowings under a secured loan facility and a secured construction loan, respectively, representing our proportionate share of indebtedness in our unconsolidated partnerships. We expect to incur additional debt in connection with future acquisitions and development. Our organizational documents do not limit the amount or percentage of debt that we may incur. As of June 30, 2010, the principal payments due for our consolidated indebtedness were $3.8 million in 2010, $200.4 million in 2011 and $45.4 million in 2012. In addition, as of June 30, 2010, our portion of the principal payments due for our unconsolidated indebtedness relating to our joint ventures with institutional investors advised by Prudential Real Estate Investors, or PREI, was $39.4 million in 2010 and $40.7 million in 2011. Given current economic conditions including, but not limited to, the credit crisis and related turmoil in the global financial system, we may be unable to refinance these obligations when due, which may negatively affect our ability to conduct operations.
          Ongoing disruptions in the financial markets and the downturn of the broader U.S. economy could affect our ability to obtain debt financing on reasonable terms, or at all, and have other adverse effects on us.
          The U.S. credit markets in particular continue to experience significant dislocations and liquidity disruptions which have caused the spreads on prospective debt financings to widen considerably. These circumstances have materially impacted liquidity in the debt markets, making financing terms for borrowers less attractive, and in certain cases have resulted in the unavailability of certain types of debt financing. Continued uncertainty in the credit markets may negatively impact our ability to access additional debt financing or to refinance existing debt maturities on reasonable terms (or at all), which may negatively affect our ability to conduct operations, make acquisitions and fund current and future development and redevelopment projects. In addition, the financial position of the lenders under our unsecured line of credit may worsen to the point that they default on their obligations to make available to us the funds under that facility. A prolonged downturn in the credit markets may cause us to seek alternative sources of potentially less attractive financing, and may require us to adjust our business plan accordingly. In addition, these factors may make it more difficult for us to sell properties or may adversely affect the price we receive for properties that we do sell, as prospective buyers may experience increased costs of debt financing or difficulties in obtaining debt financing. These events in the credit markets have also had an adverse effect on other financial markets in the United States and globally, including the stock markets, which may make it more difficult or costly for us to raise capital through the issuance of common stock, preferred stock or other equity securities.
          This reduced access to liquidity has had a negative impact on the U.S. economy, affecting consumer confidence and spending and negatively impacting the volume and pricing of real estate transactions. If this downturn in the national economy were to continue or worsen, the value of our properties, as well as the income we receive from our properties, could be adversely affected.
          These disruptions in the financial markets may also have other adverse effects on us or the economy generally, which could adversely affect our ability to service our debt obligations, including the notes, and ability to pay distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          We have and may continue to engage in hedging transactions, which can limit our gains and increase exposure to losses.
          We have and may continue to enter into hedging transactions to protect us from the effects of interest rate fluctuations on floating rate debt. Our hedging transactions may include entering into interest rate swap agreements or interest rate cap or floor agreements, or other interest rate exchange contracts. Hedging activities may not have the desired beneficial impact on our results of operations or financial condition. No hedging activity can completely insulate us from the risks associated with changes in interest rates. Moreover, interest rate hedging could fail to protect us or adversely affect us because, among other things:

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    Available interest rate hedging may not correspond directly with the interest rate risk for which we seek protection.
 
    The duration or the amount of the hedge may not match the duration or amount of the related liability.
 
    The party owing money in the hedging transaction may default on its obligation to pay.
 
    The credit quality of the party owing money on the hedge may be downgraded to such an extent that it impairs our ability to sell or assign our side of the hedging transaction.
 
    The value of derivatives used for hedging may be adjusted from time to time in accordance with accounting rules to reflect changes in fair-value. Downward adjustments, or “mark-to-market losses,” would reduce our Company’s equity.
          Hedging involves risk and typically involves costs, including transaction costs, that may reduce our overall returns on our investments. These costs increase as the period covered by the hedging increases and during periods of rising and volatile interest rates. These costs will also limit the amount of cash available for distribution to stockholders. We generally intend to hedge as much of the interest rate risk as management determines is in our best interests given the cost of such hedging transactions. The REIT qualification rules may limit our ability to enter into hedging transactions by requiring us to limit our income from hedges. If we are unable to hedge effectively because of the REIT rules, we will face greater interest rate exposure than may be commercially prudent.
          As of June 30, 2010, we had two interest rate swaps with an aggregate notional amount of $150.0 million under which, at each monthly settlement date, we either (1) receive the difference between a fixed interest rate (the Strike Rate) and one-month LIBOR if the Strike Rate is less than LIBOR or (2) pay such difference if the Strike Rate is greater than LIBOR.
          For further detail regarding our interest rate swaps, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources.”
          The terms governing our unsecured line of credit and the notes include restrictive covenants relating to our operations, which could limit our ability to respond to changing market conditions and our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          The terms of our unsecured line of credit impose restrictions on us that affect our distribution and operating policies and our ability to incur additional debt. For example, we are subject to a maximum leverage ratio requirement (as defined) during the term of the loan, which could reduce our ability to incur additional debt and consequently reduce our ability to pay distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders. The terms of our unsecured line of credit also contain limitations on our ability to make distributions to BioMed Realty Trust, Inc.’s stockholders in excess of those required to maintain BioMed Realty Trust, Inc.’s REIT status. Specifically, the terms of our unsecured line of credit limit distributions to 95% of funds from operations, but not less than the minimum necessary to enable us to meet BioMed Realty Trust, Inc.’s REIT income distribution requirements. In addition, the terms of our unsecured line of credit contain covenants that, among other things, limit our ability to further mortgage our properties or reduce insurance coverage, and that require us to maintain specified levels of net worth. The indenture governing the notes also contains financial and operating covenants that, among other things, restrict our ability to take specific actions, even if we believe them to be in our best interest, including restrictions on our ability to (1) consummate a merger, consolidation or sale of all or substantially all of our assets and (2) incur additional secured and unsecured indebtedness.
          The covenants relating to our unsecured line of credit and the notes may adversely affect our flexibility and our ability to achieve our operating plans. Our ability to comply with these covenants and other provisions relating to our credit agreement and the notes may be affected by changes in our operating and financial performance, changes in general business and economic conditions, adverse regulatory developments or other events adversely impacting us. The breach of any of these covenants could result in a default under our indebtedness, which could cause those and other obligations to become due and payable. If any of our indebtedness is accelerated, we may not be able to repay it, pursue our business plan or make distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.

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          If we fail to obtain external sources of capital, which is outside of our control, we may be unable to make distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders, maintain our REIT qualification, or fund growth.
          In order to maintain BioMed Realty Trust, Inc.’s qualification as a REIT and to avoid incurring a nondeductible excise tax, we are required, among other things, to distribute annually at least 90% of BioMed Realty Trust, Inc.’s REIT taxable income, excluding any net capital gain. In addition, we will be subject to income tax at regular corporate rates to the extent that we distribute less than 100% of BioMed Realty Trust, Inc.’s net taxable income, including any net capital gains. Because of these distribution requirements, we may not be able to fund future capital needs, including any necessary acquisition financing, from operating cash flow. Consequently, we rely on third-party sources to fund our capital needs. We may not be able to obtain financings on favorable terms or at all. Our access to third-party sources of capital depends, in part, on:
    general market conditions,
 
    the market’s perception of our growth potential,
 
    with respect to acquisition financing, the market’s perception of the value of the properties to be acquired,
 
    our current debt levels,
 
    our current and expected future earnings,
 
    our cash flow and cash distributions, and
 
    the market price per share of BioMed Realty Trust, Inc.’s common stock or preferred stock.
          Our inability to obtain capital from third-party sources will adversely affect our business and limit our growth. Without sufficient capital, we may not be able to acquire or develop properties when strategic opportunities exist, satisfy our debt service obligations or make the cash distributions to BioMed Realty Trust, Inc.’s stockholders necessary to maintain our qualification as a REIT. For distributions with respect to the taxable years ending on or before December 31, 2011, recent Internal Revenue Service, or IRS, guidance allows BioMed Realty Trust, Inc. to satisfy up to 90% of BioMed Realty Trust, Inc.’s distribution requirements through the distribution of shares of BioMed Realty Trust, Inc.’s common stock, provided certain conditions are met.
          Increases in interest rates could increase the amount of our debt payments, adversely affecting our ability to service our debt obligations, including the notes, and pay distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders.
          Interest we pay could reduce cash available for payments with respect to the notes and distributions. Additionally, if we incur variable rate debt, including borrowings under our $720.0 million unsecured line of credit, to the extent not adequately hedged, increases in interest rates would increase our interest costs. These increased interest costs would reduce our cash flows and our ability to make payments with respect to the notes and distributions to BioMed Realty, L.P.’s unitholders and BioMed Realty Trust, Inc.’s stockholders. In addition, if we need to repay existing debt during a period of rising interest rates, we could be required to liquidate one or more of our investments in properties at times that may not permit realization of the maximum return on such investments.
Risks Related to Our Organizational Structure
          BioMed Realty Trust, Inc.’s board of directors may amend our investing and financing policies in a manner that could increase the risk we default under our debt obligations or that could harm our business and results of operations.
          BioMed Realty Trust, Inc.’s board of directors has adopted a policy of targeting our indebtedness at approximately 50% of our total asset book value. However, our organizational documents do not limit the amount or percentage of debt that we may incur, nor do they limit the types of properties we may acquire or develop. BioMed Realty Trust, Inc.’s board of directors may alter or eliminate our current policy on borrowing or investing at any time without stockholder approval. Changes in our strategy or in our investment or leverage policies could expose us to greater credit risk and interest rate risk and could also result in a more leveraged balance sheet. These factors could result in an increase in our debt service and could adversely affect our cash flow and our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders. Higher leverage also increases the risk we could default on our debt.

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          We may invest in properties with other entities, and our lack of sole decision-making authority or reliance on a co-venturer’s financial condition could make these joint venture investments risky.
          We have in the past and may continue in the future to co-invest with third parties through partnerships, joint ventures or other entities. We may acquire non-controlling interests or share responsibility for managing the affairs of a property, partnership, joint venture or other entity. In such events, we would not be in a position to exercise sole decision-making authority regarding the property or entity. Investments in entities may, under certain circumstances, involve risks not present were a third party not involved. These risks include the possibility that partners or co-venturers:
    might become bankrupt or fail to fund their share of required capital contributions,
 
    may have economic or other business interests or goals that are inconsistent with our business interests or goals, and
 
    may be in a position to take actions contrary to our policies or objectives.
          Such investments may also have the potential risk of impasses on decisions, such as a sale, because neither we nor the partner or co-venturer would have full control over the partnership or joint venture. Disputes between us and partners or co-venturers may result in litigation or arbitration that would increase our expenses and prevent our officers and/or directors from focusing their time and effort on our business. In addition, we may in certain circumstances be liable for the actions of our third-party partners or co-venturers if:
    we structure a joint venture or conduct business in a manner that is deemed to be a general partnership with a third party, in which case we could be liable for the acts of that third party,
 
    third-party managers incur debt or other liabilities on behalf of a joint venture which the joint venture is unable to pay, and the joint venture agreement provides for capital calls, in which case we could be liable to make contributions as set forth in any such joint venture agreement, or
 
    we agree to cross-default provisions or to cross-collateralize our properties with the properties in a joint venture, in which case we could face liability if there is a default relating to those properties in the joint venture or the obligations relating to those properties.
          We have investments in joint ventures with PREI, which were formed in the second quarter of 2007. While we, as managing member, are authorized to carry out the day-to-day management of the business and affairs of the PREI joint ventures, PREI’s prior written consent is required for certain decisions, including decisions relating to financing, budgeting and the sale or pledge of interests in the properties owned by the PREI joint ventures.
          In addition, each of the PREI operating agreements includes a put/call option whereby either member can cause the limited liability company to sell certain properties in which it holds leasehold interests to us at any time after the fifth anniversary and before the seventh anniversary of the acquisition date. The put/call option may be exercised at a time we do not deem favorable for financial or other reasons, including the availability of cash at such time and the impact of tax consequences resulting from any sale.
Risks Related to BioMed Realty Trust, Inc.’s REIT Status
          BioMed Realty Trust, Inc.’s failure to qualify as a REIT under the Code would result in significant adverse tax consequences to us and would adversely affect our business.
          We believe that we have operated and intend to continue operating in a manner intended to allow BioMed Realty Trust, Inc. to qualify as a REIT for federal income tax purposes under the Internal Revenue Code of 1986, as amended, or the Code. Qualification as a REIT involves the application of highly technical and complex Code provisions for which there are only limited judicial and administrative interpretations. The fact that we hold substantially all of our assets through our operating partnership further complicates the application of the REIT requirements. Even a seemingly minor technical or inadvertent mistake could jeopardize BioMed Realty Trust, Inc.’s REIT status. BioMed Realty Trust, Inc.’s REIT status depends upon various factual matters and circumstances that may not be entirely within our control. For example, in order for BioMed Realty Trust, Inc. to qualify as a REIT, at least 95% of our gross income in any year must be derived from qualifying sources, and we must satisfy a number of requirements regarding the composition of our assets. Also, BioMed Realty Trust, Inc. must make distributions to stockholders aggregating annually at least 90% of BioMed Realty Trust, Inc.’s REIT taxable income, excluding capital gains. In addition, new legislation, regulations, administrative interpretations or court decisions, each of which could have retroactive effect, may make it more difficult or impossible for BioMed Realty Trust, Inc. to qualify as a REIT, or could reduce the desirability of an investment in a REIT relative to other investments. We have not requested and do not plan to request a ruling from the IRS that BioMed Realty Trust, Inc. qualifies as a REIT, and the statements in this report are not binding on the IRS or any court. Accordingly, we cannot be certain that BioMed Realty Trust, Inc. has qualified or will continue to qualify as a REIT.

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          If BioMed Realty Trust, Inc. fails to qualify as a REIT in any taxable year, we will face serious adverse tax consequences that would substantially reduce the funds available to make payments of principal and interest on the debt securities we issue and for distribution to BioMed Realty Trust, Inc.’s stockholders. If BioMed Realty Trust, Inc. fails to qualify as a REIT:
    we would not be allowed to deduct distributions to stockholders in computing our taxable income and would be subject to federal income tax at regular corporate rates,
 
    we could also be subject to the federal alternative minimum tax and possibly increased state and local taxes, and
 
    unless we are entitled to relief under applicable statutory provisions, BioMed Realty Trust, Inc. could not elect to be taxed as a REIT for four taxable years following the year in which BioMed Realty Trust, Inc. was disqualified.
          In addition, if BioMed Realty Trust, Inc. fails to qualify as a REIT, we will not be required to make distributions to stockholders; however, all distributions to BioMed Realty Trust, Inc.’s stockholders would be subject to tax as qualifying corporate dividends to the extent of our current and accumulated earnings and profits. As a result of all these factors, BioMed Realty Trust, Inc.’s failure to qualify as a REIT could impair our ability to expand our business and raise capital and would adversely affect the value of BioMed Realty Trust, Inc.’s common stock and preferred stock.
          To maintain BioMed Realty Trust, Inc.’s REIT status, we may be forced to borrow funds during unfavorable market conditions to make distributions to BioMed Realty Trust, Inc.’s stockholders.
          For BioMed Realty Trust, Inc. to qualify as a REIT, we generally must distribute to BioMed Realty Trust, Inc.’s stockholders at least 90% of our REIT taxable income each year, determined by excluding any net capital gain, and we will be subject to regular corporate income taxes to the extent that we distribute less than 100% of our REIT taxable income each year. In addition, we will be subject to a 4% nondeductible excise tax on the amount, if any, by which distributions paid by us in any calendar year are less than the sum of 85% of our ordinary income, 95% of our capital gain net income and 100% of our undistributed income from prior years. For distributions with respect to taxable years ending on or before December 31, 2011, recent IRS guidance allows us to satisfy up to 90% of these requirements through the distribution of shares of BioMed Realty Trust, Inc.’s common stock, provided certain conditions are met. To maintain BioMed Realty Trust, Inc.’s REIT status and avoid the payment of income and excise taxes we may need to borrow funds to meet the REIT distribution requirements. These borrowing needs could result from:
    differences in timing between the actual receipt of cash and inclusion of income for federal income tax purposes,
 
    the effect of non-deductible capital expenditures,
 
    the creation of reserves, or
 
    required debt or amortization payments.
          We may need to borrow funds at times when the then-prevailing market conditions are not favorable for borrowing. These borrowings could increase our costs or reduce our equity and adversely affect the value of BioMed Realty Trust, Inc.’s common stock or preferred stock.
          To maintain BioMed Realty Trust, Inc.’s REIT status, we may be forced to forego otherwise attractive opportunities.
          For BioMed Realty Trust, Inc. to qualify as a REIT, we must satisfy tests concerning, among other things, the sources of our income, the nature and diversification of our assets, the amounts we distribute to BioMed Realty Trust, Inc.’s stockholders and the ownership of BioMed Realty Trust, Inc.’s stock. We may be required to make distributions to BioMed Realty Trust, Inc.’s stockholders at times when it would be more advantageous to reinvest cash in our business or when we do not have funds readily available for distribution. Thus, compliance with the REIT requirements may hinder our ability to operate solely on the basis of maximizing profits.
Risks Related to this Offering
          If you do not exchange your private notes pursuant to this exchange offer, you may not be able to sell your notes.
          It may be difficult for you to sell private notes that are not exchanged in the exchange offer. Those private notes may not be offered or sold unless they are registered or there are exemptions from the registration requirements under the Securities Act and applicable state securities laws.

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          If you do not tender your private notes or if we do not accept some of your private notes, those notes will continue to be subject to the transfer and exchange restrictions in:
    the indenture;
 
    the legend on the private notes; and
 
    the offering memorandum relating to the private notes.
          The restrictions on transfer of your private notes arise because we issued the private notes pursuant to an exemption from the registration requirements of the Securities Act and applicable state securities laws. In general, you may only offer or sell the private notes if they are registered under the Securities Act and applicable state securities laws, or offered and sold pursuant to an exemption from such requirements. We do not intend to register the private notes under the Securities Act. To the extent private notes are tendered and accepted in the exchange offer, the trading market, if any, for untendered private notes would be adversely affected.
          If the procedures for tendering your private notes in this exchange offer are not followed, you may not receive exchange notes in exchange for your private notes.
          We will issue the exchange notes in exchange for your private notes only if you tender the private notes and deliver a properly completed and duly executed letter of transmittal and other required documents before expiration of the exchange offer. You should allow sufficient time to ensure timely delivery of the necessary documents. Neither the Exchange Agent nor we are under any duty to give notification of defects or irregularities with respect to the tenders of private notes for exchange. If you are the beneficial holder of private notes that are registered in the name of your broker, dealer, commercial bank, trust company or other nominee, and you wish to tender private notes in the exchange offer, you should promptly contact the person in whose name your private notes are registered and instruct that person to tender your private notes on your behalf.
          The effective subordination of the notes may limit our ability to satisfy our obligations under the notes.
          The notes will be senior unsecured obligations of BioMed Realty, L.P. and will rank equally in right of payment with each other and with all of the other senior unsecured indebtedness of BioMed Realty, L.P. However, the notes will be effectively subordinated to all of the existing and future secured indebtedness of BioMed Realty, L.P., to the extent of the value of the collateral securing such indebtedness. The indenture governing the notes places limitations on our ability to incur secured indebtedness, but does not prohibit us from incurring secured indebtedness in the future. Consequently, in the event of a bankruptcy, liquidation, dissolution, reorganization or similar proceeding with respect to us, the holders of any secured indebtedness will be entitled to proceed directly against the collateral that secures such indebtedness. Therefore, such collateral will not be available for satisfaction of any amounts owed under our unsecured indebtedness, including the notes, until such secured indebtedness is satisfied in full. As of June 30, 2010, BioMed Realty, L.P. had $658.8 million of secured indebtedness and $372.4 million of senior unsecured indebtedness (excluding trade payables, distributions payable, accrued expenses and committed letters of credit and the $250.0 million principal amount of the notes).
          The notes also will be effectively subordinated to all existing and future unsecured and secured liabilities and preferred equity of the subsidiaries of BioMed Realty, L.P. In the event of a bankruptcy, liquidation, dissolution, reorganization or similar proceeding with respect to any such subsidiary, BioMed Realty, L.P., as an equity owner of such subsidiary, and therefore holders of its debt, including the notes, will be subject to the prior claims of such subsidiary’s creditors, including trade creditors, and preferred equity holders. The entire balance of $658.8 million of secured indebtedness BioMed Realty, L.P. had as of June 30, 2010, was attributable to indebtedness of its subsidiaries.
          We may not be able to generate sufficient cash flow to meet our debt service obligations.
          Our ability to make payments on and to refinance our indebtedness, including the notes, and to fund our operations, working capital and capital expenditures, depends on our ability to generate cash in the future. To a certain extent, our cash flow is subject to general economic, industry, financial, competitive, operating, legislative, regulatory and other factors, many of which are beyond our control.

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          Holders of our currently outstanding Exchangeable Notes have the right to require us to repurchase such Exchangeable Notes for cash on specified dates or upon the occurrence of designated events. In addition, with respect to the Notes due 2026, we are required under certain circumstances to settle exchanges of such Notes due 2026 in cash up to the aggregate principal amount of such Notes due 2026. Any of our future debt agreements or securities may contain similar provisions. We may not have sufficient funds to make the required repurchase or settlement of such Exchangeable Notes in cash at the applicable time and, in such circumstances, may not be able to arrange the necessary financing on favorable terms, or at all. In addition, our ability to make the required repurchase or settlement may be limited by law or the terms of other debt agreements or securities. However, our failure to make the required repurchase or settlement of the Exchangeable Notes would constitute an event of default under the applicable indentures which, in turn, could constitute an event of default under other debt agreements, thereby resulting in their acceleration and required prepayment and further restricting our ability to make such payments and repurchases.
          We cannot assure you that our business will generate sufficient cash flow from operations or that future sources of cash will be available to us in an amount sufficient to enable us to pay amounts due on our indebtedness, including the notes, or to fund our other liquidity needs. Additionally, if we incur additional indebtedness in connection with future acquisitions or development projects or for any other purpose, our debt service obligations could increase.
          We may need to refinance all or a portion of our indebtedness, including the notes, on or before maturity. Our ability to refinance our indebtedness or obtain additional financing will depend on, among other things:
    our financial condition and market conditions at the time; and
 
    restrictions in the agreements governing our indebtedness.
          As a result, we may not be able to refinance any of our indebtedness, including the notes, on commercially reasonable terms, or at all. If we do not generate sufficient cash flow from operations, and additional borrowings or refinancings or proceeds of asset sales or other sources of cash are not available to us, we may not have sufficient cash to enable us to meet all of our obligations, including payments on the notes. Accordingly, if we cannot service our indebtedness, we may have to take actions such as seeking additional equity or delaying capital expenditures, or strategic acquisitions and alliances, any of which could have a material adverse effect on our operations. We cannot assure you that we will be able to effect any of these actions on commercially reasonable terms, or at all.
          BioMed Realty Trust, Inc. has no significant operations and no material assets, other than its investment in BioMed Realty, L.P.
          The notes will be fully and unconditionally guaranteed by BioMed Realty Trust, Inc. However, BioMed Realty Trust, Inc. has no significant operations and no material assets, other than its investment in BioMed Realty, L.P. Furthermore, BioMed Realty Trust, Inc.’s guarantee of the notes will be effectively subordinated to all existing and future unsecured and secured liabilities and preferred equity of its subsidiaries (including BioMed Realty, L.P. and any entity BioMed Realty Trust, Inc. accounts for under the equity method of accounting). As of June 30, 2010, the total indebtedness of BioMed Realty Trust, Inc.’s subsidiaries, including BioMed Realty, L.P., was approximately $1.3 billion (excluding trade payables, distributions payable, accrued expenses and committed letters of credit).
          There is currently no trading market for the notes, and an active liquid trading market for the notes may not develop or, if it develops, may not be maintained or be liquid. The failure of an active liquid trading market for the notes to develop or be maintained is likely to adversely affect the market price and liquidity of the notes.
          The notes are a new issue of securities, and there is currently no existing trading market for the notes. We do not intend to apply for listing of the notes on any securities exchange or for quotation of the notes on any automated dealer quotation system. Although the initial purchasers of the notes advised us that they intend to make a market in the notes, they are not obligated to do so and may discontinue any market-making at any time without notice. Accordingly, an active trading market may not develop for the notes and, even if one develops, may not be maintained. If an active trading market for the notes does not develop or is not maintained, the market price and liquidity of the notes is likely to be adversely affected, and holders may not be able to sell their notes at desired times and prices or at all. If any of the notes are traded after their purchase, they may trade at a discount from their purchase price.
          The liquidity of the trading market, if any, and future trading prices of the notes will depend on many factors, including, among other things, prevailing interest rates, the financial condition, results of operations, business, prospects and credit quality of BioMed Realty, L.P., BioMed Realty Trust, Inc. and our subsidiaries, and other comparable entities, the market for similar securities and the overall securities market, and may be adversely affected by unfavorable changes in any of these factors, some of which are beyond our control.

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          The indenture governing the notes contains restrictive covenants that limit our operating flexibility.
          The indenture governing the notes contains financial and operating covenants that, among other things, restrict our ability to take specific actions, even if we believe them to be in our best interest, including restrictions on our ability to:
    consummate a merger, consolidation or sale of all or substantially all of our assets; and
 
    incur additional secured and unsecured indebtedness.
In addition, the credit agreement governing our unsecured line of credit requires us to meet specified financial covenants relating to a minimum amount of net worth, fixed charge coverage, unsecured debt service coverage, the maximum amount of secured and secured recourse indebtedness, leverage ratio and certain investment limitations. These covenants may restrict our ability to expand or fully pursue our business strategies. Our ability to comply with these and other provisions of the indenture governing the notes and our credit agreement may be affected by changes in our operating and financial performance, changes in general business and economic conditions, adverse regulatory developments or other events adversely impacting us. The breach of any of these covenants, including those contained in our credit agreement and the indenture governing the notes, could result in a default under our indebtedness, which could cause those and other obligations to become due and payable. If any of our indebtedness is accelerated, we may not be able to repay it.
          Despite our substantial indebtedness, we may still incur significantly more debt, which could exacerbate any or all of the risks related to our indebtedness, including our inability to pay the principal of or interest on the notes.
          We may be able to incur substantial additional indebtedness in the future. The indentures governing the Exchangeable Notes do not limit our ability or that of our subsidiaries to incur additional debt. Although the credit agreement governing our unsecured line of credit and indenture governing the notes limit our ability to incur additional indebtedness, these restrictions are subject to a number of qualifications and exceptions and, under certain circumstances, debt incurred in compliance with these restrictions could be substantial. To the extent that we or our subsidiaries incur additional indebtedness or other such obligations, we may face additional risks associated with our indebtedness, including our possible inability to pay the principal of or interest on the notes.
          Federal and state statutes allow courts, under specific circumstances, to void guarantees and require holders of notes to return payments received from guarantors.
          Under the federal bankruptcy law and comparable provisions of state fraudulent transfer laws, a guarantee, such as the guarantee provided by BioMed Realty Trust, Inc., could be voided, or claims in respect of a guarantee could be subordinated to all other debts of that guarantor if, among other things, the guarantor, at the time it incurred the indebtedness evidenced by its guarantee:
    received less than reasonably equivalent value or fair consideration for the incurrence of the guarantee;
 
    was insolvent or rendered insolvent by reason of the incurrence of the guarantee;
 
    was engaged in a business or transaction for which the guarantor’s remaining assets constituted unreasonably small capital; or
 
    intended to incur, or believed that it would incur, debts beyond its ability to pay those debts as they mature.
          In addition, any payment by that guarantor pursuant to its guarantee could be voided and required to be returned to the guarantor, or to a fund for the benefit of the creditors of the guarantor. The measures of insolvency for purposes of these fraudulent transfer laws will vary depending upon the law applied in any proceeding to determine whether a fraudulent transfer has occurred. Generally, however, a guarantor would be considered insolvent if:
    the sum of its debts, including contingent liabilities, was greater than the fair saleable value of all of its assets;
 
    the present fair saleable value of its assets was less than the amount that would be required to pay its probable liability on its existing debts, including contingent liabilities, as they became absolute and mature; or
 
    it could not pay its debts as they become due.
          The court might also void such guarantee, without regard to the above factors, if it found that a guarantor entered into its guarantee with actual or deemed intent to hinder, delay, or defraud its creditors.

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          A court would likely find that a guarantor did not receive reasonably equivalent value or fair consideration for its guarantee unless it benefited directly or indirectly from the issuance of the notes. If a court voided such guarantee, holders of the notes would no longer have a claim against such guarantor or the benefit of the assets of such guarantor constituting collateral that purportedly secured such guarantee. In addition, the court might direct holders of the notes to repay any amounts already received from a guarantor. If the court were to void BioMed Realty Trust, Inc.’s guarantee, we cannot assure you that funds would be available to pay the notes from any of our subsidiaries or from any other source.
          An increase in interest rates could result in a decrease in the relative value of the notes.
          In general, as market interest rates rise, notes bearing interest at a fixed rate generally decline in value because the premium, if any, over market interest rates will decline. Consequently, if you invest in these notes and market interest rates increase, the market value of your notes may decline. We cannot predict the future level of market interest rates.

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FORWARD-LOOKING STATEMENTS
          This prospectus contains “forward-looking statements” within the meaning of the federal securities laws. In particular, statements pertaining to our capital resources, portfolio performance and results of operations contain forward-looking statements. Likewise, our statements regarding anticipated growth in our funds from operations and anticipated market conditions, demographics and results of operations are forward-looking statements. Forward-looking statements involve numerous risks and uncertainties, and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods which may be incorrect or imprecise, and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). You can identify forward-looking statements by the use of forward-looking terminology such as “believes”, “expects”, “may”, “will”, “should”, “seeks”, “approximately”, “intends”, “plans”, “pro forma”, “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases. You can also identify forward-looking statements by discussions of strategy, plans or intentions. The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements:
    adverse economic or real estate developments in the life science industry or in our target markets, including the inability of our tenants to obtain funding to run their businesses;
 
    our dependence upon significant tenants;
 
    our failure to obtain necessary outside financing on favorable terms or at all, including the continued availability of our unsecured line of credit;
 
    general economic conditions, including downturns in the national and local economies;
 
    volatility in financial and securities markets;
 
    defaults on or non-renewal of leases by tenants;
 
    our inability to compete effectively;
 
    increased interest rates and operating costs;
 
    our inability to successfully complete real estate acquisitions, developments and dispositions;
 
    risks and uncertainties affecting property development and construction;
 
    our failure to successfully operate acquired properties and operations;
 
    reductions in asset valuations and related impairment charges;
 
    the loss of services of one or more of our executive officers;
 
    BioMed Realty Trust, Inc.’s failure to qualify or continue to qualify as a REIT;
 
    our failure to maintain our investment grade credit ratings with the rating agencies;
 
    government approvals, actions and initiatives, including the need for compliance with environmental requirements;
 
    the effects of earthquakes and other natural disasters;
 
    lack of or insufficient amounts of insurance; and
 
    changes in real estate, zoning and other laws and increases in real property tax rates.
          While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. For a further discussion of these and other factors that could impact our future results, performance or transactions, see the section of this prospectus above entitled “Risk Factors” and the risks incorporated herein from our most recent Annual Report on Form 10-K and our subsequent quarterly reports on Form 10-Q, as updated by our future filings under the Exchange Act.

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THE EXCHANGE OFFER
Purpose of the Exchange Offer
          On April 29, 2010, our operating partnership issued $250.0 million of the private notes to Wells Fargo Securities, LLC, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., KeyBanc Capital Markets Inc., Morgan Stanley & Co. Incorporated, Raymond James & Associates, Inc., RBC Capital Markets Corporation, RBS Securities Inc., UBS Securities LLC and U.S. Bancorp Investments, Inc., the initial purchasers, pursuant to a purchase agreement. The initial purchasers subsequently sold the private notes to “qualified institutional buyers,” as defined in Rule 144A under the Securities Act, in reliance on Rule 144A, and outside the United States under Regulation S of the Securities Act. As a condition to the sale of the private notes, we entered into a registration rights agreement with the representatives of the initial purchasers on April 29, 2010. Pursuant to the registration rights agreement, we agreed that we would:
  (1)   use commercially reasonable efforts to file an exchange offer registration statement with the SEC on or prior to October 26, 2010;
 
  (2)   use commercially reasonable efforts to cause the exchange offer registration statement to become effective on or prior to December 25, 2010;
 
  (3)   use commercially reasonable efforts to cause the exchange offer to be consummated within 60 days after the exchange offer registration statement is declared effective; and
 
  (4)   in some circumstances, file a shelf registration statement providing for the sale of the private notes by the holders thereof.
          Upon the effectiveness of the exchange offer registration statement, we will offer the exchange notes in exchange for the private notes. A copy of the registration rights agreement is incorporated by reference as an exhibit to the registration statement of which this prospectus forms a part.
Resale of the Exchange Notes
          Based upon an interpretation by the staff of the SEC contained in no-action letters issued to third parties, we believe that you may exchange private notes for exchange notes in the ordinary course of business. For further information on the SEC’s position, see Exxon Capital Holdings Corporation, available May 13, 1988, Morgan Stanley & Co. Incorporated, available June 5, 1991, and Shearman & Sterling, available July 2, 1993, and other interpretive letters to similar effect. You will be allowed to resell exchange notes to the public without further registration under the Securities Act and without delivering to purchasers of the exchange notes a prospectus that satisfies the requirements of Section 10 of the Securities Act so long as you do not participate, do not intend to participate, and have no arrangement or understanding with any person to participate, in a distribution of the exchange notes. However, the foregoing does not apply to you if you are: a broker-dealer who purchased the exchange notes directly from us to resell pursuant to Rule 144A or any other available exemption under the Securities Act; or you are an “affiliate” of ours within the meaning of Rule 405 under the Securities Act.
          In addition, if you are a broker-dealer, or you acquire exchange notes in the exchange offer for the purpose of distributing or participating in the distribution of the exchange notes, you cannot rely on the position of the staff of the SEC contained in the no-action letters mentioned above or other interpretive letters to similar effect and must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction, unless an exemption from registration is otherwise available.
          Each broker-dealer that receives exchange notes for its own account in exchange for private notes, which the broker-dealer acquired as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of the exchange notes. By delivering a prospectus, a broker-dealer may be deemed to be an “underwriter” within the meaning of the Securities Act. A broker-dealer may use this prospectus, as it may be amended or supplemented from time to time, in connection with resales of exchange notes received in exchange for private notes which the broker-dealer acquired as a result of market-making or other trading activities.
Terms of the Exchange Offer
          Upon the terms and subject to the conditions described in this prospectus and in the accompanying letter of transmittal, which together constitute the exchange offer, we will accept any and all private notes validly tendered and not withdrawn before the expiration date. We will issue $1,000 principal amount of exchange notes in exchange for each $1,000 principal amount of outstanding private notes surrendered pursuant to the exchange offer. You may tender private notes only in integral multiples of $1,000.
          The form and terms of the exchange notes are the same as the form and terms of the private notes except that:
    we will register the exchange notes under the Securities Act and, therefore, the exchange notes will not bear legends restricting their transfer; and
 
    holders of the exchange notes will not be entitled to any of the rights of holders of private notes under the registration rights agreement, which rights will terminate upon the completion of the exchange offer.

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          The exchange notes will evidence the same debt as the private notes and will be issued under the same indenture, so the exchange notes and the private notes will be treated as a single class of debt securities under the indenture.
          As of the date of this prospectus, $250.0 million in aggregate principal amount of the private notes are outstanding and registered in the name of Cede & Co., as nominee for DTC. Only registered holders of the private notes, or their legal representative or attorney-in-fact, as reflected on the records of the trustee under the indenture, may participate in the exchange offer. We will not set a fixed record date for determining registered holders of the private notes entitled to participate in the exchange offer.
          You do not have any appraisal or dissenters’ rights under the indenture in connection with the exchange offer. We intend to conduct the exchange offer in accordance with the provisions of the registration rights agreement and the applicable requirements of the Securities Act, the Exchange Act and the rules and regulations of the SEC.
          We will be deemed to have accepted validly tendered private notes when, as and if we have given written notice of acceptance to the Exchange Agent. The Exchange Agent will act as your agent for the purposes of receiving the exchange notes from us.
          If you tender private notes in the exchange offer you will not be required to pay brokerage commissions or fees with respect to the exchange of private notes pursuant to the exchange offer. We will pay all charges and expenses, other than the applicable taxes described below, in connection with the exchange offer.
Expiration Date; Extensions; Amendments
          The term “expiration date” will mean 5:00 p.m., New York City time on      , 2010 (the 21st business day following commencement of the exchange offer), unless we, in our sole discretion, extend the exchange offer, in which case the term expiration date will mean the latest date and time to which we extend the exchange offer.
          To extend the exchange offer, we will notify the Exchange Agent and each registered holder of any extension in writing by a press release or other public announcement before 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date. The notice of extension will disclose the aggregate principal amount of the private notes that have been tendered as of the date of such notice.
          We reserve the right, in our reasonable discretion:
    to delay accepting any private notes due to an extension of the exchange offer; or
 
    if any conditions listed below under “—Conditions” are not satisfied, to terminate the exchange offer,
in each case by written notice of the delay, extension or termination to the Exchange Agent and by press release or other public announcement.
          We will follow any delay in acceptance, extension or termination as promptly as practicable by written notice to the registered holders by a press release or other public announcement. If we amend the exchange offer in a manner we determine constitutes a material change, we will promptly disclose the amendment in a prospectus supplement that we will distribute to the registered holders. We will also extend the exchange offer for a period of five to ten business days, depending upon the significance of the amendment and the manner of disclosure, if the exchange offer would otherwise expire during the five to ten business day period.
Interest on the Exchange Notes
          The exchange notes will bear interest at the same rate and on the same terms as the private notes. Consequently, the exchange notes will bear interest at a rate equal to 6.125% per year (calculated using a 360-day year). Interest will be payable on the exchange notes semi-annually on each April 15 and October 15.
          Interest on the exchange notes will accrue from the last interest payment date on which interest was paid on the private notes or, if no interest has been paid on the private notes, from the date of initial issuance of the private notes. We will deem the right to receive any interest accrued but unpaid on the private notes waived by you if we accept your private notes for exchange.
Procedures for Tendering
  Valid Tender
          Except as described below, a tendering holder must, prior to the expiration date, transmit to U.S. Bank National Association, the Exchange Agent, at the address listed under the heading “—Exchange Agent”:
    a properly completed and duly executed letter of transmittal, including all other documents required by the letter of transmittal; or
 
    if the private notes are tendered in accordance with the book-entry procedures listed below, an agent’s message.

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          In addition, a tendering holder must:
    deliver certificates, if any, for the private notes to the Exchange Agent at or before the expiration date; or
 
    deliver a timely confirmation of book-entry transfer of the private notes into the Exchange Agent’s account at DTC, the book-entry transfer facility, along with the letter of transmittal or an agent’s message; or
 
    comply with the guaranteed delivery procedures described below.
          The term “agent’s message” means a message, transmitted by DTC to and received by the Exchange Agent and forming a part of a book-entry confirmation, that states that DTC has received an express acknowledgment that the tendering holder agrees to be bound by the letter of transmittal and that we may enforce the letter of transmittal against this holder.
          If the letter of transmittal is signed by a person other than the registered holder of private notes, the letter of transmittal must be accompanied by a written instrument of transfer or exchange in satisfactory form duly executed by the registered holder with the signature guaranteed by an eligible institution. The private notes must be endorsed or accompanied by appropriate powers of attorney. In either case, the private notes must be signed exactly as the name of any registered holder appears on the private notes.
          If the letter of transmittal or any private notes or powers of attorney are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, these persons should so indicate when signing. Unless waived by us, proper evidence satisfactory to us of their authority to so act must be submitted.
          By tendering private notes pursuant to the exchange offer, each holder will represent to us that, among other things, the exchange notes are being acquired in the ordinary course of business of the person receiving the exchange notes, whether or not that person is the holder, and neither the holder nor the other person has any arrangement or understanding with any person to participate in the distribution of the exchange notes. In the case of a holder that is not a broker-dealer, that holder, by tendering private notes pursuant to the exchange offer, will also represent to us that the holder is not engaged in and does not intend to engage in a distribution of the exchange notes.
          The method of delivery of private notes, letters of transmittal and all other required documents is at your election and risk. If the delivery is by mail, we recommend that you use registered mail, properly insured, with return receipt requested. In all cases, you should allow sufficient time to assure timely delivery. You should not send letters of transmittal or private notes to us.
          If you are a beneficial owner whose private notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee, and wish to tender, you should promptly instruct the registered holder to tender on your behalf. Any registered holder that is a participant in DTC’s book-entry transfer facility system may make book-entry delivery of the private notes by causing DTC to transfer the private notes into the Exchange Agent’s account, including by means of DTC’s Automated Tender Offer Program.
     Signature Guarantees
          Signatures on a letter of transmittal or a notice of withdrawal must be guaranteed, unless the private notes surrendered for exchange are tendered:
    by a registered holder of the private notes who has not completed the box entitled “Special Issuance Instructions” or “Special Delivery Instructions” on the letter of transmittal; or
 
    for the account of an “eligible institution.”
          If signatures on a letter of transmittal or a notice of withdrawal are required to be guaranteed, the guarantees must be by an “eligible institution.” An “eligible institution” is an “eligible guarantor institution” meeting the requirements of the registrar for the notes, which requirements include membership or participation in the Security Transfer Agent Medallion Program, or STAMP, or such other “signature guarantee program” as may be determined by the registrar for the notes in addition to, or in substitution for, STAMP, all in accordance with the Exchange Act.

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     Book-Entry Transfer
          The Exchange Agent will make a request to establish an account for the private notes at DTC for purposes of the exchange offer within two business days after the date of this prospectus. Any financial institution that is a participant in DTC’s systems must make book-entry delivery of private notes by causing DTC to transfer those private notes into the Exchange Agent’s account at DTC in accordance with DTC’s procedure for transfer. The participant should transmit its acceptance to DTC at or prior to the expiration date or comply with the guaranteed delivery procedures described below. DTC will verify this acceptance, execute a book-entry transfer of the tendered private notes into the Exchange Agent’s account at DTC and then send to the Exchange Agent confirmation of this book-entry transfer. The confirmation of this book-entry transfer will include an agent’s message confirming that DTC has received an express acknowledgment from this participant that this participant has received and agrees to be bound by the letter of transmittal and that we may enforce the letter of transmittal against this participant.
          Delivery of exchange notes issued in the exchange offer may be effected through book-entry transfer at DTC. However, the letter of transmittal or facsimile of it or an agent’s message, with any required signature guarantees and any other required documents, must:
    be transmitted to and received by the Exchange Agent at the address listed under “—Exchange Agent” at or prior to the expiration date; or
 
    comply with the guaranteed delivery procedures described below.
          Delivery of documents to DTC in accordance with DTC’s procedures does not constitute delivery to the Exchange Agent.
     Guaranteed Delivery
          If a registered holder of private notes desires to tender the private notes, and the private notes are not immediately available, or time will not permit the holder’s private notes or other required documents to reach the Exchange Agent before the expiration date, or the procedure for book-entry transfer described above cannot be completed on a timely basis, a tender may nonetheless be made if:
    the tender is made through an eligible institution;
 
    prior to the expiration date, the Exchange Agent received from an eligible institution a properly completed and duly executed notice of guaranteed delivery, substantially in the form provided by us, by facsimile transmission, mail or hand delivery:
  1.   stating the name and address of the holder of private notes and the amount of private notes tendered;
 
  2.   stating that the tender is being made; and
 
  3.   guaranteeing that within three New York Stock Exchange trading days after the expiration date, the certificates for all physically tendered private notes, in proper form for transfer, or a book-entry confirmation, as the case may be, and a properly completed and duly executed letter of transmittal, or an agent’s message, and any other documents required by the letter of transmittal will be deposited by the eligible institution with the exchange agent; and
    the certificates for all physically tendered private notes, in proper form for transfer, or a book-entry confirmation, as the case may be, and a properly completed and duly executed letter of transmittal, or any agent’s message, and all other documents required by the letter of transmittal, are received by the Exchange Agent within three New York Stock Exchange trading days after the expiration date.
     Determination of Validity
          We will determine in our sole discretion all questions as to the validity, form and eligibility of private notes tendered for exchange. This discretion extends to the determination of all questions concerning the time of receipt, acceptance and withdrawal of tendered private notes. These determinations will be final and binding. We reserve the absolute right to reject any and all private notes not properly tendered or any private notes our acceptance of which would, in the opinion of our counsel, be unlawful. We also reserve the right to waive any defects, irregularities or conditions of tender as to any particular private note either before or after the expiration date, including the right to waive the ineligibility of any tendering holder. Our interpretation of the terms and conditions of the exchange offer as to any particular private note either before or after the expiration date, including the letter of transmittal and the instructions to the letter of transmittal, shall be final and binding on all parties. Unless waived, you must cure any defects or irregularities with respect to tenders of private notes within the time we determine. Although we intend to notify you of defects or irregularities with respect to tenders of private notes, neither we, the Exchange Agent nor any other person will incur any liability for failure to give you that notification. Unless waived, we will not deem tenders of private notes to have been made until you cure any defects or irregularities.

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     Other Rights
          While we have no present plan to acquire any private notes that are not tendered in the exchange offer or to file a registration statement to permit resales of any private notes that are not tendered in the exchange offer, we reserve the right in our sole discretion to purchase or make offers for any private notes that remain outstanding after the expiration date. We also reserve the right to terminate the exchange offer, as described below under “—Conditions,” and, to the extent permitted by applicable law, purchase private notes in the open market, in privately negotiated transactions or otherwise. The terms of any of those purchases or offers could differ from the terms of the exchange offer.
Acceptance of Private Notes for Exchange; Issuance of Exchange Notes
          Upon the terms and subject to the conditions of the exchange offer, we will accept, promptly after the expiration date, all private notes properly tendered. We will issue the exchange notes promptly after acceptance of the private notes. For purposes of the exchange offer, we will be deemed to have accepted properly tendered private notes for exchange when, as and if we have given oral or written notice to the Exchange Agent, with prompt written confirmation of any oral notice.
          In all cases, issuance of exchange notes for private notes will be made only after timely receipt by the Exchange Agent of:
    certificates for the private notes, or a timely book-entry confirmation of the private notes, into the Exchange Agent’s account at the book-entry transfer facility;
 
    a properly completed and duly executed letter of transmittal or an agent’s message; and
 
    all other required documents.
          For each private note accepted for exchange, the holder of the private note will receive an exchange note having a principal amount equal to that of the surrendered private note.
Return of Notes
          Unaccepted or non-exchanged private notes will be returned without expense to the tendering holder of the private notes. In the case of private notes tendered by book-entry transfer in accordance with the book-entry procedures described above, the non-exchanged private notes will be credited to an account maintained with DTC as promptly as practicable after the expiration or termination of the exchange offer.
Withdrawal of Tenders
          Except as otherwise provided in this prospectus, you may withdraw tenders of private notes at any time before 5:00 p.m., New York City time, on the expiration date.
          For a withdrawal to be effective, the Exchange Agent must receive a written notice of withdrawal at the address or, in the case of eligible institutions, at the facsimile number, indicated under “—Exchange Agent” before the expiration date. Any notice of withdrawal must:
    specify the name of the person, referred to as the depositor, having tendered the private notes to be withdrawn;
 
    identify the private notes to be withdrawn, including the certificate number or numbers and principal amount of the private notes;
 
    contain a statement that the holder is withdrawing its election to have the private notes exchanged;
 
    be signed by the holder in the same manner as the original signature on the letter of transmittal by which the private notes were tendered, including any required signature guarantees, or be accompanied by documents of transfer to have the trustee with respect to the private notes register the transfer of the private notes in the name of the person withdrawing the tender; and
 
    specify the name in which the private notes are registered, if different from that of the depositor.

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          If certificates for private notes have been delivered or otherwise identified to the Exchange Agent, then, prior to the release of these certificates the withdrawing holder must also submit the serial numbers of the particular certificates to be withdrawn and signed notice of withdrawal with signatures guaranteed by an eligible institution, unless this holder is an eligible institution. If private notes have been tendered in accordance with the procedure for book-entry transfer described above, any notice of withdrawal must specify the name and number of the account at the book-entry transfer facility to be credited with the withdrawn private notes.
          We will determine in our sole discretion all questions as to the validity, form and eligibility of the notices, and our determination will be final and binding on all parties. We will not deem any properly withdrawn private notes to have been validly tendered for purposes of the exchange offer, and we will not issue exchange notes with respect to those private notes, unless you validly retender the withdrawn private notes. You may retender properly withdrawn private notes by following the procedures described above under “—Procedures for Tendering” at any time before 5:00 p.m., New York City time, on the expiration date.
Conditions
          Notwithstanding any other term of the exchange offer, we will not be required to accept for exchange, or exchange the exchange notes for, any private notes, and may terminate the exchange offer as provided in this prospectus before the expiration of the exchange offer, if, in our reasonable judgment, the exchange offer violates applicable law, rules or regulations or an applicable interpretation of the staff of the SEC.
          If we determine in our reasonable discretion that any of these conditions are not satisfied, we may:
    refuse to accept any private notes and return all tendered private notes to you;
 
    extend the exchange offer and retain all private notes tendered before the exchange offer expires, subject, however, to your rights to withdraw the private notes; or
 
    waive the unsatisfied conditions with respect to the exchange offer and accept all properly tendered private notes that have not been withdrawn.
          If the waiver constitutes a material change to the exchange offer, we will promptly disclose the waiver by means of a prospectus supplement that we will distribute to the registered holders of the private notes, and we will extend the exchange offer for a period of five to ten business days, depending upon the significance of the waiver and the manner of disclosure to the registered holders, if the exchange offer would otherwise expire during the five to ten business day period.
Termination of Rights
          All of your rights under the registration rights agreement will terminate upon consummation of the exchange offer, except with respect to our continuing obligations:
    to indemnify you and parties related to you against liabilities, including liabilities under the Securities Act; and
 
    to provide, upon your request, the information required by Rule 144A(d)(4) under the Securities Act to permit resales of the notes pursuant to Rule 144A.
Shelf Registration
          In the event that:
  (1)   we and BioMed Realty Trust, Inc. determine that an exchange offer is not available or may not be completed because it would violate any applicable law or applicable interpretations of the SEC;
 
  (2)   an exchange offer is not for any other reason completed on or prior to February 23, 2011; or
 
  (3)   we receive a request from any initial purchaser of the private notes that represents that it holds private notes that are or were ineligible to be exchanged for the exchange notes in the exchange offer,
we and BioMed Realty Trust, Inc. shall use our commercially reasonable efforts to cause to be filed with the SEC as soon as practicable after such determination, date or request, as the case may be, but in no event later than 30 days after such determination, date or request, a shelf registration statement providing for the sale of all the registrable securities by the holders thereof and to have such shelf registration statement declared effective by the SEC no later than 90 days after such determination, date or request; provided that no holder shall be entitled to have its registrable securities covered by such shelf registration statement unless such holder has satisfied certain conditions relating to the provision of information in connection with the shelf registration statement.

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          For purposes of this prospectus, “registrable securities” shall mean the private notes; provided that the private notes shall cease to be registrable securities (a) when a registration statement with respect to such private notes has been declared effective under the Securities Act and such private notes have been exchanged or disposed of pursuant to such registration statement, (b) when such private notes are eligible to be sold pursuant to Rule 144 (or any similar provision then in force, but not Rule 144A) under the Securities Act or (c) when such private notes cease to be outstanding.
Liquidated Damages
          If:
  (1)   we fail to file any of the registration statements required by the registration rights agreement on or prior to the date specified for such filing;
 
  (2)   any of such registration statements is not declared effective by the SEC on or prior to the date specified for such effectiveness (the effectiveness target date);
 
  (3)   we fail to consummate the exchange offer within 60 business days of the effectiveness target date with respect to the exchange offer registration statement;
 
  (4)   the shelf registration statement or the exchange offer registration statement is declared effective but thereafter ceases to be effective or usable in connection with resales of the registrable securities during the periods specified in the registration rights agreement; or
 
  (5)   we or BioMed Realty Trust, Inc. through our omission fail to name as a selling securityholder any holder of registrable securities that has complied timely with its obligations hereunder in a manner to entitle such holder to be named in the shelf registration statement that we are required to file (each such event referred to in clauses (1) through (5) above, a registration default),
then we will pay liquidated damages to each holder of registrable securities and notify the trustee that liquidated damages apply to the registrable securities.
          With respect to the first 90-day period immediately following the occurrence of the first registration default, liquidated damages will be paid in an amount equal to one quarter of one percent (0.25%) per annum of the principal amount of the registrable securities. The amount of the liquidated damages will increase by an additional one quarter of one percent (0.25%) per annum of the principal amount of registrable securities with respect to the subsequent 90-day period until all registration defaults have been cured, up to a maximum amount of liquidated damages for all registration defaults of one half of one percent (0.5%) per annum of the principal amount of registrable securities.
          All accrued liquidated damages will be paid by us on the next scheduled interest payment date to DTC or its nominee by wire transfer of immediately available funds or by federal funds check and to holders of registrable securities in the form of certificated notes by wire transfer to the accounts specified by them or by mailing checks to their registered addresses if no such accounts have been specified.
          Following the cure of all registration defaults, the accrual of liquidated damages will cease.
Exchange Agent
          We have appointed U.S. Bank National Association as Exchange Agent for the exchange offer of notes. All executed letters of transmittal and any other required documents should be directed to the Exchange Agent at the address or facsimile number set forth below. You should direct questions and requests for assistance and requests for additional copies of this prospectus or of the letter of transmittal and requests for notices of guaranteed delivery to the Exchange Agent addressed as follows:

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U.S. Bank National Association
     
By Hand, Overnight Delivery or Mail   By Facsimile Transmission
(Registered or Certified Mail Recommended):   (for eligible institutions only):
West Side Flats Operations Center
60 Livingston Avenue
St. Paul, MN 55107
Attn.: Specialized Finance
(BioMed)
  (651) 495-8158
Attn: Specialized Finance

Fax cover sheets should provide a call back number and request a call back, upon receipt.
   
Confirm receipt by calling:
    (651) 495-3520
For Information Call:
800-934-6802
Fees and Expenses
          We will bear the expenses of soliciting tenders. We have not retained any dealer manager in connection with the exchange offer and will not make any payments to brokers, dealers or others soliciting acceptances of the exchange offer. We will, however, pay the Exchange Agent reasonable and customary fees for its services and will reimburse it for its reasonable out-of-pocket expenses.
          We will pay the cash expenses incurred in connection with the exchange offer. These expenses include registration fees, fees and expenses of the Exchange Agent and the trustee, accounting and legal fees and printing costs, among others.
          We will pay all transfer taxes, if any, applicable to the exchange of notes pursuant to the exchange offer. If, however, a transfer tax is imposed for any reason other than the exchange of the private notes pursuant to the exchange offer, then you must pay the amount of the transfer taxes. If satisfactory evidence of payment of such taxes or exemption therefrom is not submitted with the letter of transmittal, the amount of such transfer taxes will be billed directly to you.
Consequence of Failures to Exchange
          Participation in the exchange offer is voluntary. We urge you to consult your financial and tax advisors in making your decisions on what action to take. Private notes that are not exchanged for exchange notes pursuant to the exchange offer will remain restricted securities. Accordingly, those private notes may be resold only:
    to us, BioMed Realty Trust, Inc. or one of our subsidiaries;
 
    for so long as the private notes are eligible for resale pursuant to Rule 144A under the Securities Act, to a person whom the seller reasonably believes is a “qualified institutional buyer” as defined in Rule 144A under the Securities Act that purchases for its own account or for the account of a qualified institutional buyer to whom notice is given that the transfer is being made in reliance on Rule 144A and otherwise in a transaction meeting the requirements of Rule 144A;
 
    pursuant to a registration statement that has been declared effective under the Securities Act;
 
    pursuant to offers and sales that occur outside the United States to non-U.S. persons within the meaning of Regulation S under the Securities Act; or
 
    pursuant to another available exemption from the registration requirements of the Securities Act, subject to our and the trustee’s right prior to any such offer, sale or transfer to require the delivery of an opinion of counsel and/or other information satisfactory to each of us or the trustee.
          In each case, the private notes may be resold only in accordance with any applicable securities laws of any state of the United States or any other applicable jurisdiction.
Accounting Treatment
          The exchange notes will be recorded at the same carrying value as the original notes, as reflected in our accounting records on the date of the exchange. Accordingly, no gain or loss for accounting purposes will be recognized.

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USE OF PROCEEDS
          The exchange offer satisfies an obligation under the registration rights agreement relating to the notes. We will not receive any cash proceeds from the exchange offer.
          The net proceeds from the sale of the private notes after deducting discounts, commissions and offering expenses, were approximately $245.2 million. We used $150.0 million of the net proceeds to repay in full the remaining outstanding indebtedness under our secured term loan and the remaining net proceeds to fund the purchase of potential near-term property acquisitions, repay a portion of the outstanding indebtedness under our $720.0 million unsecured line of credit, which amounts we may reborrow, and for other general corporate and working capital purposes.

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SELECTED CONSOLIDATED FINANCIAL DATA
          The following tables set forth, on a historical basis, selected consolidated financial and operating data for BioMed Realty, L.P. and BioMed Realty Trust, Inc. and their respective subsidiaries. You should read the following selected financial data in conjunction with the consolidated historical financial statements and notes thereto of each of BioMed Realty, L.P. and BioMed Realty Trust, Inc. and their respective subsidiaries and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included elsewhere in this prospectus.
BioMed Realty, L.P.
          The consolidated balance sheet data as of December 31, 2009 and 2008 and the consolidated statements of income data for each of the years in the three-year period ended December 31, 2009 have been derived from the historical consolidated financial statements of BioMed Realty, L.P. and subsidiaries, which are included in this prospectus and which have been audited by KPMG LLP, an independent registered public accounting firm, whose report with respect thereto is included elsewhere in this prospectus. The consolidated balance sheet data as of December 31, 2007, 2006 and 2005 and the consolidated statements of income data for each of the years ended December 31, 2006 and 2005 have been derived from the historical consolidated financial statements of BioMed Realty, L.P. and subsidiaries, not audited by KPMG LLP. The consolidated balance sheet data as of the six months ended June 30, 2010 and the consolidated statements of income data for each of the six months ended June 30, 2010 and 2009 have been derived from the unaudited consolidated financial statements of BioMed Realty, L.P. and subsidiaries, which are included elsewhere in this prospectus. The results for the six months ended June 30, 2010 are not necessarily indicative of the results to be expected for the full year.
                                                         
    Six Months Ended June 30,     Years Ended December 31,  
    2010     2009     2009     2008     2007     2006     2005  
(in thousands, except unit data)                                                
Statements of Income:
                                                       
Revenues:
                                                       
Total revenues
  $ 185,668     $ 180,031     $ 361,166     $ 301,973     $ 266,109     $ 218,735     $ 138,784  
 
                                         
Expenses:
                                                       
Rental operations and real estate taxes
    52,352       51,659       104,824       84,729       71,142       60,999       46,358  
Depreciation and amortization
    55,385       51,813       109,620       84,227       72,202       65,063       39,378  
General and administrative
    12,718       10,407       22,455       22,659       21,474       17,992       13,040  
Acquisition related expenses
    1,968             464       175       396       93       238  
 
                                         
Total expenses
    122,423       113,879       237,363       191,790       165,214       144,147       99,014  
 
                                         
Income from operations
    63,245       66,152       123,803       110,183       100,895       74,588       39,770  
Equity in net (loss)/income of unconsolidated partnerships
    (377 )     (766 )     (2,390 )     (1,200 )     (893 )     83       119  
Interest income
    71       164       308       485       990       1,102       1,333  
Interest expense
    (43,131 )     (24,955 )     (64,998 )     (41,172 )     (28,786 )     (40,945 )     (23,226 )
(Loss)/gain on derivative instruments
    (347 )     303       203       (19,948 )                  
(Loss)/gain on extinguishment of debt
    (2,265 )     6,152       3,264       14,783                    
 
                                         
Income from continuing operations
    17,196       47,050       60,190       63,131       72,206       34,828       17,996  
Income from discontinued operations before gain on sale of assets
                            639       1,542       57  
Gain on sale of real estate assets
                            1,087              
 
                                         
Income from discontinued operations
                            1,726       1,542       57  
 
                                         
Net income
    17,196       47,050       60,190       63,131       73,932       36,370       18,053  
Net income attributable to noncontrolling interests
    21       30       64       9       (45 )     137       267  
 
                                         
Net income attributable to the operating partnership
    17,217       47,080       60,254       63,140       73,887       36,507       18,320  
Preferred stock dividends
    (8,481 )     (8,481 )     (16,963 )     (16,963 )     (16,868 )            
 
                                         
Net income available to the operating partnership
  $ 8,736     $ 38,599     $ 43,291     $ 46,177     $ 57,019     $ 36,507     $ 18,320  
 
                                         

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    Six Months Ended June 30,     Years Ended December 31,  
(in thousands, except unit data)   2010     2009     2009     2008     2007     2006     2005  
Income from continuing operations attributable to unitholders:
                                                       
Basic earnings per unit
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.80     $ 0.59     $ 0.44  
Diluted earnings per unit
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.80     $ 0.59     $ 0.43  
Net income per unit attributable to unitholders:
                                                       
Basic earnings per unit
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.83     $ 0.61     $ 0.44  
Diluted earnings per unit
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.83     $ 0.61     $ 0.44  
Weighted-average units outstanding:
                                                       
Basic
    106,890,664       87,511,810       94,005,382       74,753,230       68,219,557       58,792,539       38,913,103  
Diluted
    108,298,135       88,580,072       94,005,382       75,408,153       68,738,694       58,886,694       42,091,195  
Cash distributions declared per unit
  $ 0.29     $ 0.45     $ 0.70     $ 1.34     $ 1.24     $ 1.16     $ 1.08  
Cash distributions declared per preferred unit
  $ 0.92     $ 0.92     $ 1.84     $ 1.84     $ 1.83              
                                                 
    June 30,     December 31,  
    2010     2009     2008     2007     2006     2005  
(in thousands)                                          
Balance Sheet Data:
                                               
Investments in real estate, net
  $ 3,075,150     $ 2,971,767     $ 2,960,429     $ 2,807,599     $ 2,457,721     $ 1,129,371  
Total assets
    3,428,221       3,283,274       3,229,314       3,058,631       2,692,572       1,337,310  
Total indebtedness
    1,284,238       1,361,805       1,341,099       1,489,585       1,329,588       513,233  
Total liabilities
    1,382,708       1,459,342       1,591,365       1,641,850       1,444,843       586,162  
Total equity
    2,045,513       1,823,932       1,637,949       1,416,781       1,247,729       751,148  
Other Data:
                                               
Cash flows from/(used in):
                                               
Operating activities
    63,431       145,089       115,046       114,965       101,588       54,762  
Investing activities
    (172,398 )     (157,627 )     (218,661 )     (409,301 )     (1,339,463 )     (601,805 )
Financing activities
    110,384       11,038       111,558       282,151       1,243,227       539,486  

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BioMed Realty Trust, Inc.
          The consolidated balance sheet data as of December 31, 2009 and 2008 and the consolidated statements of income data for each of the years in the three-year period ended December 31, 2009 have been derived from the historical consolidated financial statements of BioMed Realty Trust, Inc. and subsidiaries, which are included in this prospectus and which have been audited by KPMG LLP, an independent registered public accounting firm, whose report with respect thereto is included elsewhere in this prospectus. The consolidated balance sheet data as of December 31, 2007 and the consolidated statements of income data for the year ended December 31, 2006 have been derived from the historical consolidated financial statements of BioMed Realty Trust, Inc. and subsidiaries, audited by KPMG LLP, whose report with respect thereto is not included or incorporated by reference in this prospectus. The consolidated balance sheet data as of December 31, 2006 and 2005 and the consolidated statements of income data for the year ended December 31, 2005 have been derived from the historical consolidated financial statements of BioMed Realty Trust, Inc. and subsidiaries, not audited by KPMG LLP. The consolidated balance sheet data and consolidated statements of income data as of and for each of the six months ended June 30, 2010 and 2009 have been derived from the unaudited consolidated financial statements of BioMed Realty Trust, Inc. and subsidiaries, which are included elsewhere in this prospectus. The results for the six months ended June 30, 2010 are not necessarily indicative of the results to be expected for the full year. Certain prior year amounts have been reclassified to conform to the current year presentation.
                                                         
    Six Months Ended June 30,     Years Ended December 31,  
    2010     2009     2009     2008     2007     2006     2005  
(in thousands, except share data)                                                  
Statements of Income:
                                                       
Revenues:
                                                       
Total revenues
  $ 185,668     $ 180,031     $ 361,166     $ 301,973     $ 266,109     $ 218,735     $ 138,784  
 
                                         
Expenses:
                                                       
Rental operations and real estate taxes
    52,352       51,659       104,824       84,729       71,142       60,999       46,358  
Depreciation and amortization
    55,385       51,813       109,620       84,227       72,202       65,063       39,378  
General and administrative
    12,718       10,407       22,455       22,659       21,474       17,992       13,040  
Acquisition related expenses
    1,968             464       175       396       93       238  
 
                                         
Total expenses
    122,423       113,879       237,363       191,790       165,214       144,147       99,014  
 
                                         
Income from operations
    63,245       66,152       123,803       110,183       100,895       74,588       39,770  
Equity in net (loss)/income of unconsolidated partnerships
    (377 )     (766 )     (2,390 )     (1,200 )     (893 )     83       119  
Interest income
    71       164       308       485       990       1,102       1,333  
Interest expense
    (43,131 )     (24,955 )     (64,998 )     (41,172 )     (28,786 )     (40,945 )     (23,226 )
(Loss)/gain on derivative instruments
    (347 )     303       203       (19,948 )                  
(Loss)/gain on extinguishment of debt
    (2,265 )     6,152       3,264       14,783                    
 
                                         
Income from continuing operations
    17,196       47,050       60,190       63,131       72,206       34,828       17,996  
Income from discontinued operations before gain on sale of assets
                            639       1,542       57  
Gain on sale of real estate assets
                            1,087              
 
                                         
Income from discontinued operations
                            1,726       1,542       57  
 
                                         
Net income
    17,196       47,050       60,190       63,131       73,932       36,370       18,053  
Net income attributable to noncontrolling interests
    (216 )     (1,350 )     (1,468 )     (2,077 )     (2,531 )     (1,610 )     (1,007 )
 
                                         
Net income attributable to the Company
    16,980       45,700       58,722       61,054       71,401       34,760       17,046  
Preferred stock dividends
    (8,481 )     (8,481 )     (16,963 )     (16,963 )     (16,868 )            
 
                                         
Net income available to common stockholders
  $ 8,499     $ 37,219     $ 41,759     $ 44,091     $ 54,533     $ 34,760     $ 17,046  
 
                                         
Income from continuing operations per share available to common stockholders:
                                                       
Basic earnings per share
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.81     $ 0.59     $ 0.44  
Diluted earnings per share
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.80     $ 0.59     $ 0.43  

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    Six Months Ended June 30,     Years Ended December 31,  
(in thousands, except share data)   2010     2009     2009     2008     2007     2006     2005  
Net income per share available to common stockholders:
                                                       
Basic earnings per share
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.83     $ 0.61     $ 0.44  
Diluted earnings per share
  $ 0.08     $ 0.44     $ 0.45     $ 0.61     $ 0.83     $ 0.61     $ 0.44  
Weighted-average common shares outstanding:
                                                       
Basic
    104,000,339       84,403,582       91,011,123       71,684,244       65,303,204       55,928,975       38,913,103  
Diluted
    108,298,135       88,580,072       91,851,002       75,408,153       68,738,694       58,886,694       42,091,195  
Cash dividends declared per common share
  $ 0.29     $ 0.45     $ 0.70     $ 1.34     $ 1.24     $ 1.16     $ 1.08  
Cash dividends declared per preferred share
  $ 0.92     $ 0.92     $ 1.84     $ 1.84     $ 1.83              
                                                 
    June 30,     December 31,  
    2010     2009     2008     2007     2006     2005  
(in thousands)                                          
Balance Sheet Data:
                                               
Investments in real estate, net
  $ 3,075,150     $ 2,971,767     $ 2,960,429     $ 2,807,599     $ 2,457,721     $ 1,129,371  
Total assets
    3,428,221       3,283,274       3,229,314       3,058,631       2,692,572       1,337,310  
Total indebtedness
    1,284,238       1,361,805       1,341,099       1,489,585       1,329,588       513,233  
Total liabilities
    1,382,708       1,459,342       1,591,365       1,641,850       1,444,843       586,162  
Total equity
    2,045,513       1,823,932       1,637,949       1,416,781       1,247,729       751,148  
Other Data:
                                               
Cash flows from/(used in):
                                               
Operating activities
    63,431       145,089       115,046       114,965       101,588       54,762  
Investing activities
    (172,398 )     (157,627 )     (218,661 )     (409,301 )     (1,339,463 )     (601,805 )
Financing activities
    110,384       11,038       111,558       282,151       1,243,227       539,486  

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
          As used herein, the terms “we,” “us,” “our” or the “Company” refer to BioMed Realty Trust, Inc., a Maryland corporation, and any of our subsidiaries, including BioMed Realty, L.P., a Maryland limited partnership of which we are the parent company and general partner, which may be referred to herein as the “operating partnership.” BioMed Realty Trust, Inc. conducts its business and owns its assets through the operating partnership and operates a fully integrated, self-administered and self-managed REIT. The operating partnership is focused on acquiring, developing, owning, leasing and managing laboratory and office space for the life science industry. Our tenants primarily include biotechnology and pharmaceutical companies, scientific research institutions, government agencies and other entities involved in the life science industry. Our properties are generally located in markets with well established reputations as centers for scientific research, including Boston, San Diego, San Francisco, Seattle, Maryland, Pennsylvania and New York/New Jersey.
          We were formed on April 30, 2004 and completed BioMed Realty Trust, Inc.’s initial public offering on August 11, 2004.
          At June 30, 2010, our portfolio consisted of 73 properties, representing 120 buildings with an aggregate of approximately 11.0 million rentable square feet.
          The following reflects the classification of our properties between stabilized properties (operating properties in which more than 90% of the rentable square footage is under lease), lease up (operating properties in which less than 90% of the rentable square footage is under lease), development (properties that are currently under development through ground up construction), redevelopment (properties that are currently being prepared for their intended use), pre-development (development properties that are engaged in activities related to planning, entitlement, or other preparations for future construction) and land parcels (representing management’s estimates of rentable square footage if development of these properties was undertaken) at June 30, 2010:
                                                                         
    Consolidated Portfolio     Unconsolidated Partnership Portfolio     Total Portfolio  
                    Percent of                     Percent of                     Percent of  
            Rentable     Rentable             Rentable     Rentable             Rentable     Rentable  
            Square     Square             Square     Square             Square     Square  
    Properties     Feet     Feet Leased     Properties     Feet     Feet Leased     Properties     Feet     Feet Leased  
Stabilized
    44       5,732,015       98.8 %     4       257,268       100.0 %     48       5,989,283       98.9 %
Lease up
    19       2,638,112       65.0 %     2       417,290       58.4 %     21       3,055,402       64.1 %
 
                                                           
Current operating portfolio
    63       8,370,127       88.1 %     6       674,558       74.3 %     69       9,044,685       87.1 %
Long-term lease up
    1       1,389,517       26.6 %                 n/a       1       1,389,517       26.6 %
 
                                                           
Total operating portfolio
    64       9,759,644       79.4 %     6       674,558       74.3 %     70       10,434,202       79.1 %
Development
    1       176,000       100.0 %     1       280,000             2       456,000       38.6 %
Redevelopment
                n/a                   n/a                   n/a  
Pre-development
    1       152,145                         n/a       1       152,145        
 
                                                           
Total portfolio
    66       10,087,789       78.8 %     7       954,558       52.5 %     73       11,042,347       76.5 %
Land parcels
    n/a       1,577,000       n/a                   n/a       n/a       1,577,000       n/a  
 
                                                           
Total pro forma portfolio
    66       11,664,789       n/a       7       954,558       n/a       73       12,619,347       n/a  
 
                                                           
Factors Which May Influence Future Operations
          Our long-term corporate strategy is to continue to focus on acquiring, developing, owning, leasing and managing laboratory and office space for the life science industry. As of June 30, 2010, our current operating portfolio was 87.1% leased to 129 tenants. As of December 31, 2009, our current operating portfolio was 87.4% leased to 117 tenants. The decrease in the overall leasing percentage is a reflection of an increase in the rentable square footage in our current operating portfolio, which increased by approximately 504,000 rentable square feet due to acquisitions and the delivery of a redevelopment property during the six months ended June 30, 2010. Total leased square footage during the same period increased by approximately 431,000 square feet within the current operating portfolio.
          Leases representing approximately 3.3% of our leased square footage expire during 2010 and leases representing approximately 5.2% of our leased square footage expire during 2011. Our leasing strategy for 2010 focuses on leasing currently vacant space, negotiating renewals for leases scheduled to expire during the year, and identifying new tenants or existing tenants seeking additional space to occupy the spaces for which we are unable to negotiate such renewals. We may proceed with additional new developments and acquisitions, as real estate and capital market conditions permit.
          As a direct result of the recent economic recession, we believe that the fair-values of some of our properties may have declined below their respective carrying values. However, to the extent that a property has a substantial remaining estimated useful life and management does not believe that the property will be disposed of prior to the end of its useful life, it would be unusual for undiscounted cash flows to be insufficient to recover the property’s carrying value. We presently have the ability and intent to continue to own and operate our existing portfolio of properties and expected undiscounted future cash flows from the operation of the properties are expected to be sufficient to recover the carrying value of each property. Accordingly, we do not believe that the carrying value of any of our properties is impaired. If our ability and/or our intent with regard to the operation of our properties otherwise dictate an earlier sale date, an impairment loss may be recognized to reduce the property to the lower of the carrying amount or fair-value less costs to sell, and such loss could be material.

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Redevelopment/Development Properties
          We are actively engaged in the redevelopment and development of certain properties in our portfolio. We believe that these activities will ultimately result in a return on our additional investment once the redevelopment and development activities have been completed and the properties are leased. However, redevelopment and development activities involve inherent risks and assumptions relating to our ability to fully lease the properties. Our objective is that these properties will be fully leased upon completion of the construction activities. However, our ability to fully lease the properties may be adversely affected by changing market conditions, including periods of economic slowdown or recession, rising interest rates, declining demand for life science office and laboratory space, local oversupply of real estate assets, or competition from others, which may diminish our opportunities for leasing the property on favorable terms or at all. In addition, we may fail to retain tenants that have leased our properties, or may face significant monetary penalties, if we do not complete the construction of these properties in a timely manner or to the tenants’ specifications. Further, our competitors with greater resources may have more flexibility than we do in their ability to offer rental concessions to attract tenants to their properties, which could put pressure on our ability to attract tenants at rental rates that will provide an expected return on our additional investment in these properties. As a result, we may be unable to fully lease some of our redevelopment/development properties in a timely manner upon the completion of major construction activities.
          We also rely on external sources of debt and equity funding to provide capital for our redevelopment and development projects. Although we believe that we currently have sufficient borrowing capacity and will be able to obtain additional funding as necessary, we may be unable to obtain financing on reasonable terms (or at all) or we may be forced to seek alternative sources of potentially less attractive financing, which may require us to adjust our business and construction plans accordingly. Further, we may spend more time or money than anticipated to redevelop or develop our properties due to delays or refusals in obtaining all necessary zoning, land use, building, occupancy and other required governmental permits and authorizations or other unanticipated delays in the construction.
Lease Expirations
          The following is a summary of lease expirations this year and over the next ten calendar years for leases in place at June 30, 2010. This table assumes that none of the tenants exercise renewal options or early termination rights, if any, at or prior to the scheduled expirations:
                                         
                                    Annualized  
                            Percent of     Base Rent  
            Percent of     Annualized     Annualized     per Leased  
    Leased     Leased     Base Rent     Base Rent     Square Foot  
Year of Lease Expiration   Square Feet     Square Feet     Current     Current     Current  
                    (In thousands)                  
2010(1)
    280,795       3.3 %   $ 6,187       2.0 %   $ 22.03  
2011
    438,373       5.2 %     12,274       3.9 %     28.00  
2012
    334,721       4.0 %     7,645       2.5 %     22.84  
2013
    571,752       6.8 %     13,499       4.3 %     23.61  
2014
    764,821       9.1 %     18,041       5.8 %     23.59  
2015
    121,243       1.4 %     3,506       1.1 %     28.92  
2016
    1,054,564       12.5 %     41,029       13.2 %     38.91  
2017
    118,045       1.4 %     3,463       1.1 %     29.34  
2018
    1,117,541       13.2 %     48,218       15.5 %     43.15  
2019
    270,150       3.2 %     7,600       2.4 %     28.13  
Thereafter
    3,376,713       39.9 %     150,377       48.2 %     44.53  
 
                             
Total Portfolio/Weighted-Average
    8,448,718       100.0 %   $ 311,839       100.0 %   $ 36.91  
 
                             
 
(1)   Includes current month-to-month leases.
          The following is a summary of lease expirations this year and over the next ten calendar years for leases in place at June 30, 2010 by geographic market:
                                                                         
    Leased Square Feet  
Expiration   Boston     Maryland     San Diego     NY/NJ     San Francisco     Pennsylvania     Seattle     University/Other     Total  
2010
    108,171             22,108       31,524       118,992                         280,795  
2011
    37,388       113,784       61,288       27,244       71,308       127,361                   438,373  
2012
    21,705             118,042       53,769       118,992             22,213             334,721  
2013
    12,972             148,800       136,594       225,106       44,318       3,962             571,752  
2014
    28,019       121,414       89,744             66,002       396,776       41,366       21,500       764,821  
2015
                53,740             32,750       34,753                   121,243  
2016
    618,603                         100,040       76,022       31,892       228,007       1,054,564  
2017
          51,181       21,470       45,394                               118,045  
2018
    807,347             68,237             199,329             42,628             1,117,541  
2019
    2,676       168,817                   61,757             36,900             270,150  
Thereafter
    673,589       1,047,570       673,860       703,546       242,851       35,297                   3,376,713  
 
                                                     
Total
    2,310,470       1,502,766       1,257,289       998,071       1,237,127       714,527       178,961       249,507       8,448,718  
 
                                                     

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          The success of our leasing and development strategy will be dependent upon the general economic conditions and more specifically real estate market conditions and life science industry trends in the United States and in our target markets of Boston, San Diego, San Francisco, Seattle, Maryland, Pennsylvania, New York/New Jersey and research parks near or adjacent to universities. We cannot give any assurance that leases will be renewed or that available space will be released at rental rates equal to or above the current contractual rental rates or at all.
Critical Accounting Policies
          The preparation of financial statements in conformity with generally accepted accounting principles, or GAAP, requires management to use judgment in the application of accounting policies, including making estimates and assumptions. We base our estimates on historical experience and on various other assumptions believed to be reasonable under the circumstances. These judgments affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. If our judgment or interpretation of the facts and circumstances relating to various transactions had been different, it is possible that different accounting policies would have been applied resulting in a different presentation of our financial statements. On an ongoing basis, we evaluate our estimates and assumptions. In the event estimates or assumptions prove to be different from actual results, adjustments are made in subsequent periods to reflect more current information. Below is a discussion of accounting policies that we consider critical in that they address the most material parts of our financial statements, require complex judgment in their application or require estimates about matters that are inherently uncertain.
Investments in Real Estate
          Investments in real estate are carried at depreciated cost. Depreciation and amortization are recorded on a straight-line basis over the estimated useful lives of the assets as follows:
     
Buildings and improvements
  15-40 years
Ground lease
  Term of the related lease
Tenant improvements
  Shorter of the useful lives or the terms of the related leases
Furniture, fixtures, and equipment
  3 to 5 years
Acquired in-place leases
  Non-cancelable term of the related lease
Acquired management agreements
  Non-cancelable term of the related agreement
          Our estimates of useful lives have a direct impact on our net income. If expected useful lives of our investments in real estate were shortened, we would depreciate the assets over a shorter time period, resulting in an increase to depreciation expense and a corresponding decrease to net income on an annual basis.
          Management must make significant assumptions in determining the value of assets and liabilities acquired. The use of different assumptions in the allocation of the purchase cost of the acquired properties would affect the timing of recognition of the related revenue and expenses. The fair-value of tangible assets of an acquired property (which includes land, buildings and improvements) is determined by valuing the property as if it were vacant, and the “as-if-vacant” value is then allocated to land, buildings and improvements based on management’s determination of the relative fair-value of these assets. Factors considered by us in performing these analyses include an estimate of the carrying costs during the expected lease-up periods, current market conditions, and costs to execute similar leases. In estimating carrying costs, we include real estate taxes, insurance and other operating expenses, and estimates of lost rental revenue during the expected lease-up periods based on current market demand.
          The aggregate value of other acquired intangible assets consisting of acquired in-place leases and acquired management agreements are recorded based on a variety of considerations including, but not necessarily limited to: (1) the value associated with avoiding the cost of originating the acquired in-place leases (i.e. the market cost to execute a lease, including leasing commissions and legal fees, if any); (2) the value associated with lost revenue related to tenant reimbursable operating costs estimated to be incurred during the assumed lease-up period (i.e. real estate taxes and insurance); and (3) the value associated with lost rental revenue from existing leases during the assumed lease-up period (see discussion of the recognition of acquired above-market and below-market leases in Revenue Recognition, Operating Expenses and Lease Terminations section below). The fair-value assigned to the acquired management agreements are recorded at the present value (using a discount rate which reflects the risks associated with the management agreements acquired) of the acquired management agreements with certain tenants of the acquired properties. The values of in-place leases and management agreements are amortized to expense over the remaining non-cancelable period of the respective leases or agreements. If a lease were to be terminated or if termination is determined to be likely (e.g., in the case of a tenant bankruptcy) prior to its contractual expiration, amortization of all unamortized amounts related to that lease would be accelerated and such amounts written off.

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          Costs incurred in connection with the development or construction of properties and improvements are capitalized. Capitalized costs include pre-construction costs essential to the development of the property, development costs, construction costs, interest costs, real estate taxes, salaries and related costs and other direct costs incurred during the period of development. We capitalize costs on land and buildings under development until construction is substantially complete and the property is held available for occupancy. The determination of when a development project is substantially complete and when capitalization must cease involves a degree of judgment. We consider a construction project as substantially complete and held available for occupancy upon the completion of landlord-owned tenant improvements or when the lessee takes possession of the unimproved space for construction of its own improvements, but no later than one year from cessation of major construction activity. We cease capitalization on the portion substantially completed and occupied or held available for occupancy, and capitalize only those costs associated with any remaining portion under construction. Costs associated with acquisitions are charged to expense as incurred.
          Repair and maintenance costs are charged to expense as incurred and significant replacements and betterments are capitalized. Repairs and maintenance costs include all costs that do not extend the useful life of an asset or increase its operating efficiency. Significant replacement and betterments represent costs that extend an asset’s useful life or increase its operating efficiency.
          When circumstances such as adverse market conditions indicate a possible impairment of the value of a property, we review the recoverability of the property’s carrying value. The review of recoverability is based on an estimate of the future undiscounted cash flows (excluding interest charges) expected to result from the long-lived asset’s use and eventual disposition. These cash flows consider factors such as expected future operating income, trends and prospects, as well as the effects of leasing demand, competition and other factors. If impairment exists due to the inability to recover the carrying value of a long-lived asset, an impairment loss is recorded to the extent that the carrying value exceeds the estimated fair-value of the property. We are required to make subjective assessments as to whether there are impairments in the values of our investments in long-lived assets. These assessments have a direct impact on our net income because recording an impairment loss results in an immediate negative adjustment to net income. The evaluation of anticipated cash flows is highly subjective and is based in part on assumptions regarding future occupancy, rental rates and capital requirements that could differ materially from actual results in future periods. Although our strategy is to hold our properties over the long-term, if our strategy changes or market conditions otherwise dictate an earlier sale date, an impairment loss may be recognized to reduce the property to the lower of the carrying amount or fair-value less costs to sell, and such loss could be material. If we determine that impairment has occurred, the affected assets must be reduced to their fair-value.
Revenue Recognition, Operating Expenses and Lease Terminations
          We commence revenue recognition on our leases based on a number of factors. In most cases, revenue recognition under a lease begins when the lessee takes possession of or controls the physical use of the leased asset. Generally, this occurs on the lease commencement date. In determining what constitutes the leased asset, we evaluate whether we or the lessee is the owner, for accounting purposes, of the tenant improvements. If we are the owner, for accounting purposes, of the tenant improvements, then the leased asset is the finished space and revenue recognition begins when the lessee takes possession of the finished space, typically when the improvements are substantially complete. If we conclude that we are not the owner, for accounting purposes, of the tenant improvements (the lessee is the owner), then the leased asset is the unimproved space and any tenant improvement allowances funded under the lease are treated as lease incentives, which reduce revenue recognized on a straight-line basis over the remaining non-cancelable term of the respective lease. In these circumstances, we begin revenue recognition when the lessee takes possession of the unimproved space for the lessee to construct improvements. The determination of who is the owner, for accounting purposes, of the tenant improvements determines the nature of the leased asset and when revenue recognition under a lease begins. We consider a number of different factors to evaluate whether we or the lessee is the owner of the tenant improvements for accounting purposes. These factors include:
    whether the lease stipulates how and on what a tenant improvement allowance may be spent;
 
    whether the tenant or landlord retain legal title to the improvements;
 
    the uniqueness of the improvements;
 
    the expected economic life of the tenant improvements relative to the length of the lease;
 
    the responsible party for construction cost overruns; and
 
    who constructs or directs the construction of the improvements.

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          The determination of who owns the tenant improvements, for accounting purposes, is subject to significant judgment. In making that determination we consider all of the above factors. However, no one factor is determinative in reaching a conclusion.
          All leases are classified as operating leases and minimum rents are recognized on a straight-line basis over the term of the related lease. The excess of rents recognized over amounts contractually due pursuant to the underlying leases is included in accrued straight-line rents on the accompanying consolidated balance sheets and contractually due but unpaid rents are included in accounts receivable. Existing leases at acquired properties are reviewed at the time of acquisition to determine if contractual rents are above or below current market rents for the acquired property. An identifiable lease intangible asset or liability is recorded based on the present value (using a discount rate that reflects the risks associated with the acquired leases) of the difference between (1) the contractual amounts to be paid pursuant to the in-place leases and (2) our estimate of the fair market lease rates for the corresponding in-place leases at acquisition, measured over a period equal to the remaining non-cancelable term of the leases and any fixed rate renewal periods. The capitalized above-market lease values are amortized as a reduction of rental income over the remaining non-cancelable terms of the respective leases. The capitalized below-market lease values are amortized as an increase to rental income over the remaining non-cancelable terms of the respective leases. If a lease were to be terminated or if termination were determined to be likely (e.g., in the case of a tenant bankruptcy) prior to its contractual expiration, amortization of the related unamortized above or below market lease intangible would be accelerated and such amounts written off.
          Rental operations expenses, consisting of real estate taxes, insurance and common area maintenance costs, are subject to recovery from tenants under the terms of lease agreements. Amounts recovered are dependent on several factors, including occupancy and lease terms. Revenues are recognized in the period the expenses are incurred. The reimbursements are recorded in revenues as tenant recoveries, and the expenses are recorded in rental operations expenses, as the Company is generally the primary obligor with respect to purchasing goods and services from third-party suppliers, has discretion in selecting the supplier and bears the credit risk.
          On an ongoing basis, we evaluate the recoverability of tenant balances, including rents receivable, straight-line rents receivable, tenant improvements, deferred leasing costs and any acquisition intangibles. When it is determined that the recoverability of tenant balances is not probable, an allowance for expected losses related to tenant receivables, including straight-line rents receivable, utilizing the specific identification method is recorded as a charge to earnings. Upon the termination of a lease, the amortization of tenant improvements, deferred leasing costs and acquisition intangible assets and liabilities is accelerated to the expected termination date as a charge to their respective line items and tenant receivables are written off as a reduction of the allowance in the period in which the balance is deemed to be no longer collectible. For financial reporting purposes, a lease is treated as terminated upon a tenant filing for bankruptcy, when a space is abandoned and a tenant ceases rent payments, or when other circumstances indicate that termination of a tenant’s lease is probable (e.g., eviction). Lease termination fees are recognized in other revenue when the related leases are canceled, the amounts to be received are fixed and determinable and collectability is assured, and when we have no continuing obligation to provide services to such former tenants.
Investments in Partnerships
          We evaluate our investments in limited liability companies and partnerships to determine whether such entities may be a variable interest entity, or VIE, and, if a VIE, whether we are the primary beneficiary. Generally, an entity is determined to be a VIE when either (1) the equity investors (if any) lack one or more of the essential characteristics of a controlling financial interest, (2) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support or (3) the equity investors have voting rights that are not proportionate to their economic interests and the activities of the entity involve or are conducted on behalf of an investor with a disproportionately small voting interest. The primary beneficiary is the entity that has both (1) the power to direct matters that most significantly impact the VIE’s economic performance and (2) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. We consider a variety of factors in identifying the entity that holds the power to direct matters that most significantly impact the VIE’s economic performance including, but not limited to, the ability to direct financing, leasing, construction and other operating decisions and activities. In addition, we consider the rights of other investors to participate in policy making decisions, to replace or remove the manager of the entity and to liquidate or sell the entity. The obligation to absorb losses and the right to receive benefits when a reporting entity is affiliated with a VIE must be based on ownership, contractual, and/or other pecuniary interests in that VIE. We have determined that we are the primary beneficiary in five VIEs, consisting of single-tenant properties in which the tenant has a fixed-price purchase option, which are consolidated and reflected in the accompanying consolidated financial statements.

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          If the above conditions do not apply, we consider whether a general partner or managing member controls a limited partnership or limited liability company, respectively. The general partner in a limited partnership or managing member in a limited liability company is presumed to control that limited partnership or limited liability company, as applicable. The presumption may be overcome if the limited partners or members have either (1) the substantive ability to dissolve the limited partnership or limited liability company, as applicable, or otherwise remove the general partner or managing member, as applicable, without cause or (2) substantive participating rights, which provide the limited partners or members with the ability to effectively participate in significant decisions that would be expected to be made in the ordinary course of the limited partnership’s or limited liability company’s business, as applicable, and thereby preclude the general partner or managing member from exercising unilateral control over the partnership or limited liability company, as applicable. If these criteria are met and we are the general partner or the managing member, as applicable, the consolidation of the partnership or limited liability company is required.
          Except for investments that are consolidated, we account for investments in entities over which we exercise significant influence, but do not control, under the equity method of accounting. These investments are recorded initially at cost and subsequently adjusted for equity in earnings and cash contributions and distributions. Under the equity method of accounting, our net equity in the investment is reflected in the consolidated balance sheets and its share of net income or loss is included in our consolidated statements of income.
          On a periodic basis, management assesses whether there are any indicators that the carrying value of our investments in unconsolidated partnerships or limited liability companies may be impaired on a more than temporary basis. An investment is impaired only if management’s estimate of the fair-value of the investment is less than the carrying value of the investment on a more than temporary basis. To the extent impairment has occurred, the loss is measured as the excess of the carrying value of the investment over the fair-value of the investment. Management does not believe that the value of any of our unconsolidated investments in partnerships or limited liability companies was impaired as of June 30, 2010.
Assets and Liabilities Measured at Fair-Value
          We measure financial instruments and other items at fair-value where required under GAAP, but have elected not to measure any additional financial instruments and other items at fair-value as permitted under fair-value option accounting guidance.
          Fair-value measurement is determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair-value measurements, there is a fair-value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).
          Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair-value measurement is based on inputs from different levels of the fair-value hierarchy, the level in the fair-value hierarchy within which the entire fair-value measurement falls is based on the lowest level input that is significant to the fair-value measurement in its entirety. Our assessment of the significance of a particular input to the fair-value measurement in its entirety requires judgment, and considers factors specific to the asset or liability.
          We have used interest rate swaps to manage our interest rate risk. The valuation of these instruments is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves. The fair-values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. We incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair-value measurements. In adjusting the fair-value of our derivative contracts for the effect of nonperformance risk, we have considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees.
Derivative Instruments
          We record all derivatives on the consolidated balance sheets at fair-value. In determining the fair-value of our derivatives, we consider our credit risk and that of our counterparties. These counterparties are generally larger financial institutions engaged in providing a variety of financial services. These institutions generally face similar risks regarding adverse changes in market and economic conditions, including, but not limited to, fluctuations in interest rates, exchange rates, equity and commodity prices and credit spreads. The ongoing disruptions in the financial markets have heightened the risks to these institutions. While management believes that our counterparties will meet their obligations under the derivative contracts, it is possible that defaults may occur.

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          The accounting for changes in the fair-value of derivatives depends on the intended use of the derivative, whether we have elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair-value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair-value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair-value of the hedged asset or liability that are attributable to the hedged risk in a fair-value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. We may enter into derivative contracts that are intended to economically hedge certain of our risks, even though hedge accounting does not apply or we elect not to apply hedge accounting.
          For derivatives designated as cash flow hedges, the effective portion of changes in the fair-value of the derivative is initially reported in accumulated other comprehensive income (outside of earnings) and subsequently reclassified to earnings in the period in which the hedged transaction affects earnings. If charges relating to the hedged transaction are being deferred pursuant to redevelopment or development activities, the effective portion of changes in the fair-value of the derivative are also deferred in other comprehensive income on the consolidated balance sheet, and are amortized to the income statement once the deferred charges from the hedged transaction begin again to affect earnings. The ineffective portion of changes in the fair-value of the derivative is recognized directly in earnings. We assess the effectiveness of each hedging relationship by comparing the changes in cash flows of the derivative hedging instrument with the changes in cash flows of the designated hedged item or transaction. For derivatives that are not classified as hedges, changes in the fair-value of the derivative are recognized directly in earnings in the period in which the change occurs.
          We are exposed to certain risks arising from both our business operations and economic conditions. We principally manage our exposures to a wide variety of business and operational risks through management of our core business activities. We manage economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of our debt funding and the use of derivative financial instruments. Specifically, we enter into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known or expected cash amounts, the value of which are determined by interest rates. Our derivative financial instruments are used to manage differences in the amount, timing, and duration of our known or expected cash receipts and our known or expected cash payments principally related to our investments and borrowings.
          Our primary objective in using derivatives is to add stability to interest expense and to manage our exposure to interest rate movements or other identified risks. To accomplish this objective, we primarily use interest rate swaps as part of our interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for our making fixed-rate payments over the life of the agreements without exchange of the underlying principal amount. During the six months ended June 30, 2010, such derivatives were used to hedge the variable cash flows associated with our unsecured line of credit and secured term loan (until its repayment in connection with the issuance of the private notes). During the six months ended June 30, 2009, such derivatives were used to hedge the variable cash flows associated with our unsecured line of credit, secured term loan, secured construction loan, and the forecasted issuance of fixed-rate debt. We formally document the hedging relationships for all derivative instruments, have historically accounted for all of our interest rate swap agreements as cash flow hedges, and do not use derivatives for trading or speculative purposes.
Newly Issued Accounting Pronouncements
          See Notes to Consolidated Financial Statements included elsewhere herein for disclosure and discussion of new accounting standards.

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Results of Operations
Comparison of the Six Months Ended June 30, 2010 to the Six Months Ended June 30, 2009
          The following table sets forth the basis for presenting the historical financial information for same properties (all properties except redevelopment/development and new properties), redevelopment/development properties (properties that were entirely or primarily under redevelopment or development during either of the six months ended June 30, 2010 or 2009), new properties (properties that were not owned for each of the six months ended June 30, 2010 and 2009 and were not under redevelopment/development), and corporate entities (legal entities performing general and administrative functions and fees received from our PREI joint ventures), in thousands:
                                                                 
                    Redevelopment/Development              
    Same Properties     Properties     New Properties     Corporate  
    2010     2009     2010     2009     2010     2009     2010     2009  
Rental
  $ 105,582     $ 108,951     $ 35,925     $ 25,187     $ 1,469     $     $ 4     $ (3 )
Tenant recoveries
    26,344       28,364       14,106       9,482       277             372       424  
Other income
    136       6,579       20       5                   1,433       1,042  
 
                                               
Total revenues
  $ 132,062     $ 143,894     $ 50,051     $ 34,674     $ 1,746     $     $ 1,809     $ 1,463  
 
                                               
          Rental Revenues. Rental revenues increased $8.9 million to $143.0 million for the six months ended June 30, 2010 compared to $134.1 million for the six months ended June 30, 2009. The increase was primarily due to properties that were under redevelopment or development for which partial revenue recognition commenced during 2009 and 2010 (principally related to buildings placed into service at our Landmark at Eastview property) and the commencement of leases. Same property rental revenues decreased $3.4 million, or 3.1%, for the six months ended June 30, 2010 compared to the same period in 2009. The decrease in same property rental revenues was primarily due to lease expirations and early lease terminations resulting in the accelerated amortization of below-market lease intangible assets of $2.6 million in 2009 for which the vacated space has not yet been fully released. The decrease is partially offset by the commencement of new leases at certain properties in 2010 and 2009, and increases in lease rates related to CPI adjustments and lease extensions (increasing rental revenue recognized on a straight-line basis).
          Tenant Recoveries. Revenues from tenant reimbursements increased $2.8 million to $41.1 million for the six months ended June 30, 2010 compared to $38.3 million for the six months ended June 30, 2009. The increase was primarily due to properties that were under redevelopment or development for which partial revenue recognition commenced during 2009 (principally at our Center for Life Science | Boston and Landmark at Eastview properties). Same property tenant recoveries decreased $2.0 million, or 7.1%, for the six months ended June 30, 2010 compared to the same period in 2009 primarily as a result of lease expirations and changes in 2009 at certain properties where the tenant began to pay vendors directly for certain recoverable expenses.
          The percentage of recoverable expenses recovered at our properties increased to 78.5% for the six months ended June 30, 2010 compared to 74.1% for the six months ended June 30, 2009. The increase in the recovery percentage in the current period is primarily due to higher rental operations expense for the six months ended June 30, 2009, which included approximately $4.2 million related to early lease terminations and tenant receivables that were deemed to be uncollectible and the lease commencements in 2010 and late 2009, partially offset by properties that were placed into service in 2009, but were not fully leased, and properties for which leases commenced during 2010 and late 2009, but for which payment for expense recovery will not begin until a later period.
          Other Income. Other income was $1.6 million for the six months ended June 30, 2010 compared to $7.6 million for the six months ended June 30, 2009. Other income for the six months ended June 30, 2010 primarily comprised realized gains from the sale of equity investments in the amount of $865,000 and development fees earned from our PREI joint ventures. Other income for the six months ended June 30, 2009 primarily comprised consideration received related to early lease terminations of approximately $6.5 million and development fees earned from our PREI joint ventures. Termination payments received for terminated leases for the six months ended June 30, 2010 and 2009 aggregated $72,000 and $6.5 million, respectively.
          The following table shows operating expenses for same properties, redevelopment/development properties, new properties, and corporate entities, in thousands:
                                                                 
                    Redevelopment/Development              
    Same Properties     Properties     New Properties     Corporate  
    2010     2009     2010     2009     2010     2009     2010     2009  
Rental operations
  $ 20,301     $ 26,246     $ 12,202     $ 7,963     $ 79     $     $ 2,346     $ 2,604  
Real estate taxes
    11,563       10,573       5,665       4,273       196                    
Depreciation and amortization
    35,516       39,600       19,175       12,213       694                    
 
                                               
Total expenses
  $ 67,380     $ 76,419     $ 37,042     $ 24,449     $ 969     $     $ 2,346     $ 2,604  
 
                                               

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          Rental Operations Expense. Rental operations expense decreased $1.9 million to $34.9 million for the six months ended June 30, 2010 compared to $36.8 million for the six months ended June 30, 2009. The decrease was primarily due to the write-off of accounts receivable and accrued straight line rents related to early lease terminations of approximately $4.2 million in 2009, partially offset by increased expenses related to properties that were under redevelopment or development for which partial revenue recognition commenced during 2009 and 2010 (principally at our Landmark at Eastview and Pacific Research Center properties). Same property rental operations expense decreased $5.9 million, or 22.7%, for the six months ended June 30, 2010 compared to 2009 primarily due to the write-off of certain assets related to early lease terminations and a reduction in rental operations expense due to lease expirations and changes during 2009 at certain properties where the tenant began to pay vendors directly for certain recoverable expenses and net decreases in utility usage and other recoverable costs compared to the same period in the prior year, partially offset by lease commencements in 2010 and 2009.
          For the six months ended June 30, 2010 and 2009, we recorded bad debt expense of $254,000 and $3.8 million, respectively. The decrease in the bad debt expense related to accounts receivable and accrued straight-line rents is primarily due to amounts considered uncollectible as a result of a higher number of tenant bankruptcies, lease terminations or expected nonpayment or renegotiation of unpaid tenant receivables for the six months ended June 30, 2009 as compared to the same period in 2010. As of June 30, 2010, we have fully reserved tenant receivables (both accounts receivable and straight-line rents) for certain tenants that have not terminated their leases. Such tenants may be paying some or all of their rent on a current basis, but recoverability of some or all past due receivable balances is not considered probable.
          Real Estate Tax Expense. Real estate tax expense increased $2.6 million to $17.4 million for the six months ended June 30, 2010 compared to $14.8 million for the six months ended June 30, 2009. The increase was primarily due to properties that were under redevelopment or development in the prior year for which partial revenue recognition commenced during 2009 (principally at our Pacific Research Center property) and increases in assessed property values. Same property real estate tax expense increased $990,000, or 9.4%, for the six months ended June 30, 2010 compared to 2009 primarily due to increases in both the assessed property values and in the property tax rates at a number of properties.
          Depreciation and Amortization Expense. Depreciation and amortization expense increased $3.6 million to $55.4 million for the six months ended June 30, 2010 compared to $51.8 million for the six months ended June 30, 2009. The increase was primarily due to a recorded adjustment for a cumulative understatement of depreciation expense of approximately $1.0 million related to an operating property that we determined was not material to our previously issued consolidated financial statements and the commencement of partial operations and recognition of depreciation and amortization expense at certain of our redevelopment and development properties during 2009 (principally at our Landmark at Eastview and Pacific Research Center properties), partially offset by the acceleration of depreciation on certain assets related to early lease terminations of approximately $4.0 million in the six months ended June 30, 2009.
          General and Administrative Expenses. General and administrative expenses increased $2.3 million to $12.7 million for the six months ended June 30, 2010 compared to $10.4 million for the six months ended June 30, 2009. The increase was primarily due to an increase in aggregate compensation costs as a result of share-based compensation expense and an overall increase in personnel and cash compensation, and an increase in travel expenses relating to business operations as compared to the prior year.
          Acquisition Related Expenses. Acquisition related expenses totaled $2.0 million for the six months ended June 30, 2010 due to an increase in acquisition activities as compared to the prior period, resulting in the acquisition of 55/65 West Watkins Mill Road, Medical Center Drive and 50 West Watkins Mill Road properties during the six months ended June 30, 2010 (see Note 9 of the Notes to Consolidated Financial Statements included elsewhere herein for more information).
          Equity in Net Loss of Unconsolidated Partnerships. Equity in net loss of unconsolidated partnerships decreased $389,000 to $377,000 for the six months ended June 30, 2010 compared to $766,000 for the six months ended June 30, 2009. The decreased loss primarily reflects the commencement of revenue recognition related to two leases at a property owned by one of our PREI joint ventures during the six months ended June 30, 2010.
          Interest Expense. Interest cost incurred for the six months ended June 30, 2010 totaled $46.0 million compared to $32.6 million for the six months ended June 30, 2009. Total interest cost incurred increased primarily as a result of: (a) the amortization of deferred interest costs related to our forward starting swaps of approximately $3.6 million during the six months ended June 30, 2010 and (b) increases in the average interest rate on our outstanding borrowings due to the issuance of new fixed-rate indebtedness with a higher interest rate than the variable-rate indebtedness it replaced.
          During the six months ended June 30, 2010, we capitalized $2.9 million of interest compared to $7.6 million for the six months ended June 30, 2009. The decrease reflects the cessation of capitalized interest at our Center for Life Science | Boston, Landmark at Eastview, and 530 Fairview Avenue development projects and our Pacific Research Center redevelopment project due to the commencement of certain leases at those properties or the cessation of development or redevelopment activities. Although capitalized interest costs on certain properties currently under development or redevelopment will decrease or cease as rentable space at these properties is readied for its intended use through 2010, this decrease will be offset by an increase in interest capitalized at our Gazelle Court development project, which began development activities in April 2010, as well as continued predevelopment activities at certain other properties. Net of capitalized interest and the accretion of debt premiums and a debt discount, interest expense increased $18.1 million to $43.1 million for the six months ended June 30, 2010 compared to $25.0 million for the six months ended June 30, 2009. We expect interest expense to continue to increase as additional properties currently under development or redevelopment are readied for their intended use and placed in service, from higher interest expense associated with fixed-rate indebtedness that replaced variable-rate borrowings and from the anticipated increases in interest costs related to our variable-rate indebtedness.

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          (Loss)/Gain on Derivative Instruments. The loss on derivative instruments for the six months ended June 30, 2010 of $347,000 is primarily the result of a reduction in our variable-rate indebtedness during the period, which caused the total amount of outstanding variable-rate indebtedness to fall below the combined notional value of the outstanding interest rate swaps, partially offset by changes in the fair-value of other derivative instruments. As a result, we were temporarily overhedged with respect to the outstanding interest rate swaps and we were required to prospectively discontinue hedge accounting with respect to the $250.0 million notional value interest rate swap. Subsequent changes in the fair-value and payments to counterparties associated with this interest rate swap were recorded directly to earnings. Although the remaining interest rate swaps with an aggregate notional amount of $150.0 million continued to qualify for hedge accounting, we accelerated the reclassification of amounts deferred in accumulated other comprehensive loss to earnings related to the hedged forecasted transactions that became probable of not occurring during the period in which we were overhedged.
          During the six months ended June 30, 2009, a portion of the unrealized losses related to the $100.0 million forward starting swap previously included in accumulated other comprehensive loss, totaling approximately $4.5 million, was reclassified to the consolidated statements of income as loss on derivative instruments as a result of a change in the amount of forecasted debt issuance relating to the forward starting swaps, from $400.0 million at December 31, 2008 to $368.0 million at June 30, 2009. The gain on derivative instruments for the six months ended June 30, 2009 also includes gains from changes in the fair-value of derivative instruments (net of hedge ineffectiveness of approximately $488,000 on cash flow hedges due to mismatches in forecasted debt issuance dates, maturity dates and interest rate reset dates of the interest rate and forward starting swaps and related debt).
          (Loss)/Gain on Extinguishment of Debt. During the six months ended June 30, 2010, we repurchased $6.3 million and $18.0 million face value of our Notes due 2026 at par and 100.3% of par, respectively. The repurchase resulted in the recognition of a loss on extinguishment of debt of approximately $838,000 (representing the write-off of deferred loan fees and unamortized debt discount). In addition, we recognized a loss on extinguishment of debt related to the write-off of approximately $1.4 million of deferred loan fees and legal expenses as a result of the prepayment of $250.0 million of the outstanding borrowings on our secured term loan. During the six months ended June 30, 2009, we repurchased $20.8 million face value of our Notes due 2026 for approximately $12.6 million. The repurchase resulted in the recognition of a gain on extinguishment of debt of approximately $7.0 million (net of the write-off of deferred loan fees and unamortized debt discount), partially offset by the write-off of approximately $843,000 of deferred loan fees related to the repayment of our secured construction loan in June 2009, which is reflected in our consolidated statements of income.
Comparison of the Year Ended December 31, 2009 to the Year Ended December 31, 2008
          The following table sets forth the basis for presenting the historical financial information for same properties (all properties except redevelopment/development, new properties and corporate entities), redevelopment/development properties (properties that were entirely or primarily under redevelopment or development during either of the years ended December 31, 2009 or 2008), new properties (properties that were not owned for each of the full years ended December 31, 2009 and 2008 and were not under redevelopment/development) and corporate entities (legal entities performing general and administrative functions and fees received from our PREI joint ventures), in thousands:
                                                                 
                    Redevelopment/              
                    Development              
    Same Properties     Properties     New Properties     Corporate  
    2009     2008     2009     2008     2009     2008     2009     2008  
Rental
  $ 207,209     $ 199,758     $ 62,105     $ 27,179     $ 588     $ 545     $ (1 )   $ (18 )
Tenant recoveries
    54,836       60,312       21,776       11,220       45       31       749       603  
Other income
    11,116       313       13       2       4             2,726       2,028  
 
                                               
 
                                                               
Total revenues
  $ 273,161     $ 260,383     $ 83,894     $ 38,401     $ 637     $ 576     $ 3,474     $ 2,613  
 
                                               
          Rental Revenues. Rental revenues increased $42.4 million to $269.9 million for the year ended December 31, 2009 compared to $227.5 million for the year ended December 31, 2008. The increase was primarily due to properties that were under redevelopment or development for which partial revenue recognition commenced during 2008 and 2009 (principally at our Center for Life Science | Boston property) and the commencement of leases. Same property rental revenues increased $7.5 million, or 3.7%, for the year ended December 31, 2009 compared to the same period in 2008. The increase in same property rental revenues was primarily a result of the accelerated amortization of below-market lease intangible assets related to lease terminations of $2.7 million, the commencement of new leases at certain properties in 2009, and increases in lease rates related to CPI adjustments and lease extensions (increasing rental revenue recognized on a straight-line basis), partially offset by lease expirations and early lease terminations.

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          Tenant Recoveries. Revenues from tenant reimbursements increased $5.2 million to $77.4 million for the year ended December 31, 2009 compared to $72.2 million for the year ended December 31, 2008. The increase was primarily due to properties that were under redevelopment or development for which partial revenue recognition commenced during 2008 and 2009 (principally at our Center for Life Science | Boston property), partially offset by a reduction in tenant recoveries due to lease expirations and changes in 2008 at certain properties at which the tenant began to pay vendors directly for certain recoverable expenses. Same property tenant recoveries decreased $5.5 million, or 9.1%, for the year ended December 31, 2009 compared to the same period in 2008 primarily as a result of a reduction in tenant recoveries due to lease expirations and changes in 2008 at certain properties where the tenant began to pay vendors directly for certain recoverable expenses, partially offset by lease commencements.
          The percentage of recoverable expenses recovered at our properties decreased to 73.8% for the year ended December 31, 2009 compared to 85.2% for the year ended December 31, 2008, primarily due to properties that were placed into service in 2009, but were not fully leased, and properties for which leases commenced during 2008 and 2009, but for which payment for expense recovery will not begin until a later period. In addition, property recovery percentages were affected by an increase in the rental operations expense of approximately $6.3 million related to early lease terminations and tenant receivables that were deemed to be uncollectible as of December 31, 2009.
          Other Income. Other income was $13.9 million for the year ended December 31, 2009 compared to $2.3 million for the year ended December 31, 2008. Other income for the year ended December 31, 2009 primarily comprised consideration received related to early lease terminations of approximately $10.9 million and development fees earned from our PREI joint ventures. Other income for the year ended December 31, 2008 primarily comprised development fees related to our PREI joint ventures.
          The following table shows operating expenses for same properties, redevelopment/development properties, new properties, and corporate entities, in thousands:
                                                                 
                    Redevelopment/              
                    Development              
    Same Properties     Properties     New Properties     Corporate  
    2009     2008     2009     2008     2009     2008     2009     2008  
Rental operations
  $ 45,006     $ 47,402     $ 22,114     $ 10,297     $ 1,215     $ 1,116     $ 4,878     $ 2,785  
Real estate taxes
    20,659       19,410       10,908       3,679       44       40              
Depreciation and amortization
    74,797       71,466       33,975       11,985       848       776              
 
                                               
 
                                                               
Total expenses
  $ 140,462     $ 138,278     $ 66,997     $ 25,961     $ 2,107     $ 1,932     $ 4,878     $ 2,785  
 
                                               
          Rental Operations Expense. Rental operations expense increased $11.6 million to $73.2 million for the year ended December 31, 2009 compared to $61.6 million for the year ended December 31, 2008. The increase was primarily due to properties that were under redevelopment or development for which partial revenue recognition commenced during 2008 and 2009 (principally at our Center for Life Science | Boston and Pacific Research Center properties) and the write-off of accounts receivable and accrued straight line rents related to early lease terminations of approximately $4.5 million, partially offset by lease expirations. Same property rental operations expense decreased $2.4 million, or 5.1%, for the year ended December 31, 2009 compared to 2008 primarily due to changes during 2008 at certain properties where the tenant began to pay vendors directly for certain recoverable expenses and net decreases in utility usage and other recoverable costs compared to the same period in the prior year, partially offset by the write-off of certain assets related to early lease terminations and a reduction in rental operations expense due to lease expirations.
          As discussed above, we recorded an allowance for doubtful accounts related to uncollectible tenant receivables of $6.3 million and $796,000 for the years ended December 31, 2009 and 2008, respectively.
          Real Estate Tax Expense. Real estate tax expense increased $8.5 million to $31.6 million for the year ended December 31, 2009 compared to $23.1 million for the year ended December 31, 2008. The increase was primarily due to properties that were under redevelopment or development in the prior year for which partial revenue recognition commenced during 2008 and 2009 (principally at our Center for Life Science | Boston and Pacific Research Center properties). Same property real estate tax expense increased $1.2 million, or 6.4%, for the year ended December 31, 2009 compared to 2008 primarily due to the completion of an expansion of an existing building at one of our properties in February 2009, resulting in a higher tax basis for the property in the current year.
          Depreciation and Amortization Expense. Depreciation and amortization expense increased $25.4 million to $109.6 million for the year ended December 31, 2009 compared to $84.2 million for the year ended December 31, 2008. The increase was primarily due to the commencement of partial operations and recognition of depreciation and amortization expense at certain of our redevelopment and development properties (principally at our Center for Life Science | Boston and Pacific Research Center properties) and the acceleration of depreciation on certain assets related to early lease terminations of approximately $10.2 million.

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          General and Administrative Expenses. General and administrative expenses increased $85,000 to $22.9 million for the year ended December 31, 2009 compared to $22.8 million for the year ended December 31, 2008, including acquisition related expenses of $464,000 and $175,000, respectively. The increase was primarily due to an increase in aggregate compensation costs as compared to the prior year.
          Equity in Net Loss of Unconsolidated Partnerships. Equity in net loss of unconsolidated partnerships increased $1.2 million to $2.4 million for the year ended December 31, 2009 compared to $1.2 million for the year ended December 31, 2008. The increased loss primarily reflects an accrual within our PREI joint ventures related to the calculation of annual ground lease payment escalations as a result of the increased probability for an adverse outcome relating to a portion of ongoing litigation.
          Interest Expense. Interest cost incurred for the year ended December 31, 2009 totaled $77.4 million compared to $83.5 million for the year ended December 31, 2008. Total interest cost incurred decreased primarily as a result of: (a) decreases in borrowings for working capital purposes, (b) the repayment of certain mortgage notes and (c) decreases in the average interest rate on our outstanding borrowings, partially offset by the amortization of deferred interest costs related to our forward starting swaps of approximately $3.6 million.
          During the year ended December 31, 2009, we capitalized $12.4 million of interest compared to $42.3 million for the year ended December 31, 2008. The decrease reflects the cessation of capitalized interest at our Center for Life Science | Boston, 9865 Towne Centre Drive and 530 Fairview Avenue development projects and our Pacific Research Center redevelopment project due to the commencement of certain leases at those properties or a cessation of development or redevelopment activities. Net of capitalized interest and the accretion of debt premiums and a debt discount, interest expense increased $23.8 million to $65.0 million for the year ended December 31, 2009 compared to $41.2 million for the year ended December 31, 2008.
          Gain/(Loss) on derivative instruments. During the year ended December 31, 2009, a portion of the unrealized losses related to the $100.0 million forward starting swap previously included in accumulated other comprehensive loss, totaling approximately $4.5 million, was reclassified to the consolidated statements of income as loss on derivative instruments as a result of a change in the amount of forecasted debt issuance relating to the forward starting swaps, from $400.0 million at December 31, 2008 to $368.0 million at March 31, 2009. The gain on derivative instruments for the year ended December 31, 2009 also includes gains from changes in the fair-value of derivative instruments (net of hedge ineffectiveness on cash flow hedges due to mismatches in forecasted debt issuance dates, maturity dates and interest rate reset dates of the interest rate and forward starting swaps and related debt). At December 31, 2008, the hedging relationships for two of our four forward starting swaps, with an aggregate notional amount of $150.0 million, were no longer considered highly effective as the expectation of forecasted interest payments had changed, and we were required to prospectively discontinue hedge accounting for these two swaps. As a result, a portion of the unrealized losses related to these forward starting swaps previously included in accumulated other comprehensive loss, totaling $18.2 million, was reclassified to the consolidated income statement as loss on derivative instruments in the fourth quarter of 2008. The loss on derivative instruments for the year ended December 31, 2008 also includes approximately $1.8 million of hedge ineffectiveness on cash flow hedges due to mismatches in forecasted debt issuance dates, maturity dates and interest rate reset dates of the interest rate and forward starting swaps and related debt.
          Gain on Extinguishment of Debt. During the year ended December 31, 2009, we repurchased $82.1 million face value of our Notes due 2026 for approximately $73.9 million. The repurchase resulted in the recognition of a gain on extinguishment of debt of approximately $4.1 million (net of the write-off of approximately $3.8 million in deferred loan fees and unamortized debt discount), partially offset by the write-off of approximately $843,000 of deferred loan fees related to the repayment of our secured construction loan in June 2009, which is reflected in our consolidated statements of income.
Comparison of the Year Ended December 31, 2008 to the Year Ended December 31, 2007
          The following table sets forth the basis for presenting the historical financial information for same properties (all properties except redevelopment/development, new properties, corporate entities and discontinued operations), redevelopment/development properties (properties that were entirely or primarily under redevelopment or development during either of the years ended December 31, 2008 or 2007), new properties (properties that were not owned for each of the full years ended December 31, 2008 and 2007 and were not under redevelopment/ development) and corporate entities (legal entities performing general and administrative functions and fees received from our PREI joint ventures), in thousands:
                                                                 
                    Redevelopment/              
                    Development              
    Same Properties     Properties     New Properties     Corporate  
    2008     2007     2008     2007     2008     2007     2008     2007  
Rental
  $ 181,984     $ 176,664     $ 30,580     $ 10,760     $ 14,965     $ 8,585     $ (65 )   $ (13 )
Tenant recoveries
    57,963       55,016       11,853       5,583       1,780       966       570       170  
Other income
    313       516       2       7,182                   2,028       680  
 
                                               
 
                                                               
Total revenues
  $ 240,260     $ 232,196     $ 42,435     $ 23,525     $ 16,745     $ 9,551     $ 2,533     $ 837  
 
                                               

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          Rental Revenues. Rental revenues increased $31.5 million to $227.5 million for the year ended December 31, 2008 compared to $196.0 million for the year ended December 31, 2007. The increase was primarily due to acquisitions during 2007 and 2008 and properties that were under redevelopment or development for which partial revenue recognition commenced during 2008, partially offset by properties that generated rental revenues in 2007, which subsequently entered redevelopment. Same property rental revenues increased $5.3 million, or 3.0%, for the year ended December 31, 2008 compared to the same period in 2007. The increase in same property rental revenues was primarily a result of the commencement of new leases at certain properties, and inflation-indexed rent increases at other properties, partially offset by lease expirations and early lease terminations.
          Tenant Recoveries. Revenues from tenant reimbursements increased $10.5 million to $72.2 million for the year ended December 31, 2008 compared to $61.7 million for the year ended December 31, 2007. The increase was primarily due to the commencement of new leases at a number of properties, increases in utility usage and rates, acquisitions during 2007 and 2008, properties that were under redevelopment or development for which partial revenue recognition commenced during 2008, and an increase in property management fees earned from our PREI joint ventures. Same property tenant recoveries increased $2.9 million, or 5.4%, for the year ended December 31, 2008 compared to the same period in 2007 primarily as a result of net increases in utility usage and other recoverable costs compared to the prior year, partially offset by a change in 2008 at a property at which the tenant began to pay vendors directly for certain recoverable expenses.
          The percentage of recoverable expenses recovered at our properties decreased to 85.2% for the year ended December 31, 2008 compared to 86.8% for the year ended December 31, 2007, primarily due to properties that were placed in service in 2008, but were not fully leased, and properties for which leases commenced in 2007 and 2008, but for which payment for recoverable expenses were not set to begin until a later period. In addition, property recovery percentages were affected by an increase in the rental operations expense of approximately $796,000 related to early lease terminations and tenant receivables that were deemed to be uncollectible as of December 31, 2008.
          Other Income. Other income was $2.3 million for the year ended December 31, 2008 compared to $8.4 million for the year ended December 31, 2007. Other income for the year ended December 31, 2008 primarily comprised development fees earned from our PREI joint ventures. Other income for the year ended December 31, 2007 primarily comprised $7.7 million of gains on the early termination of leases and fees earned from our PREI joint ventures.
          The following table shows operating expenses for same properties, redevelopment/development properties, new properties, and corporate entities, in thousands:
                                                                 
                    Redevelopment/              
                    Development              
    Same Properties     Properties     New Properties     Corporate  
    2008     2007     2008     2007     2008     2007     2008     2007  
Rental operations
  $ 45,860     $ 44,360     $ 10,593     $ 3,684     $ 2,148     $ 344     $ 2,999     $ 2,401  
Real estate taxes
    18,005       17,369       4,023       2,247       1,151       737       (50 )      
Depreciation and amortization
    61,946       61,347       14,008       7,959       8,273       2,896              
 
                                               
 
                                                               
Total expenses
  $ 125,811     $ 123,076     $ 28,624     $ 13,890     $ 11,572     $ 3,977     $ 2,949     $ 2,401  
 
                                               
          Rental Operations Expense. Rental operations expense increased $10.8 million to $61.6 million for the year ended December 31, 2008 compared to $50.8 million for the year ended December 31, 2007. The increase was primarily due to acquisitions during 2007 and 2008 and properties that were under redevelopment or development for which partial revenue recognition commenced during 2008, partially offset by properties that generated rental revenues in 2007, which subsequently entered redevelopment. Same property rental operations expense increased $1.5 million, or 3.4%, for the year ended December 31, 2008 compared to 2007 primarily due to the hiring of additional property management personnel and related expansion of our operations in 2007 and 2008, and net increases in utility usage and other recoverable costs compared to the same period in the prior year, partially offset by a change in 2008 at a property at which the tenant began to pay vendors directly for certain recoverable expenses.
          As discussed above, we recorded an allowance for doubtful accounts of $796,000 and $232,000 for the years ended December 31, 2008 and 2007, respectively.

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          Real Estate Tax Expense. Real estate tax expense increased $2.7 million to $23.1 million for the year ended December 31, 2008 compared to $20.4 million for the year ended December 31, 2007. The increase was primarily due to acquisitions during 2007 and 2008 and properties that were under redevelopment or development in the prior year for which partial revenue recognition commenced during 2008. Same property real estate tax expense increased $636,000, or 3.7%, for the year ended December 31, 2008 compared to 2007 primarily due to reassessments of the tax basis at certain properties in 2008 and refunds of property taxes in 2007 (reducing property tax expense in 2007), partially offset by a refund received at one property in 2008 and the continued capitalization of property taxes in connection with construction on our Landmark at Eastview II property.
          Depreciation and Amortization Expense. Depreciation and amortization expense increased $12.0 million to $84.2 million for the year ended December 31, 2008 compared to $72.2 million for the year ended December 31, 2007. The increase was primarily due to depreciation and amortization expense for the properties acquired in 2007 and 2008 and the commencement of partial operations and recognition of depreciation and amortization expense at certain of our redevelopment and development properties (principally at our Center for Life Science | Boston property), partially offset by the cessation of depreciation on certain properties, or portions thereof, which entered redevelopment in 2007 and 2008.
          General and Administrative Expenses. General and administrative expenses increased $964,000 to $22.8 million for the year ended December 31, 2008 compared to $21.9 million for the year ended December 31, 2007, including acquisition related expenses of $175,000 and $396,000, respectively. The increase was primarily due to continued growth in the corporate infrastructure necessary to support our expanded property portfolio, additional salary and stock compensation costs associated with the retirement of one of our executive officers, and costs associated with our new corporate headquarters, which was completed in the first quarter of 2008, partially offset by lower bonuses for senior management.
          Equity in Net Loss of Unconsolidated Partnerships. Equity in net loss of unconsolidated partnerships increased $307,000 to $1.2 million for the year ended December 31, 2008 compared to $893,000 for the year ended December 31, 2007. The increase was primarily due to cessation of the capitalization of interest and operating expenses at certain properties of our PREI joint ventures that were placed in service in 2008, partially offset by commencement of leases at those properties.
          Interest Expense. Interest cost incurred for the year ended December 31, 2008 totaled $83.5 million compared to $86.9 million for the year ended December 31, 2007. Total interest cost incurred decreased primarily as a result of: (a) decreases in borrowings for working capital purposes and (b) decreases in the average interest rate on our outstanding borrowings, partially offset by higher borrowings for development and redevelopment activities.
          During the year ended December 31, 2008, we capitalized $42.3 million of interest compared to $58.1 million for the year ended December 31, 2007. The decrease reflects the partial or complete cessation of capitalized interest at our Center for Life Science | Boston, 9865 Towne Centre Drive, and 530 Fairview Avenue development projects and our Pacific Research Center redevelopment project due to the commencement of certain leases at those properties. Net of capitalized interest and the accretion of debt premiums and a debt discount, interest expense increased $12.4 million to $41.2 million for the year ended December 31, 2008 compared to $28.8 million for the year ended December 31, 2007.
          Loss on derivative instruments. We had four forward starting swaps that were acquired to mitigate our exposure to the variability in expected future cash flows attributable to changes in future interest rates associated with a forecasted issuance of fixed rate debt by April 30, 2009. Such fixed rate debt was generally expected to be issued in connection with a refinancing of our secured construction loan. The four forward starting swaps had an aggregate notional value of $450.0 million. At December 31, 2008, the hedging relationships for two of our four forward starting swaps, with an aggregate notional amount of $150.0 million, were no longer considered highly effective as the expectation of forecasted interest payments had changed, and we were required to prospectively discontinue hedge accounting for these two swaps. As a result, a portion of the unrealized losses related to these forward starting swaps previously included in accumulated other comprehensive loss, totaling $18.2 million, was reclassified to the consolidated income statement as loss on derivative instruments in the fourth quarter of 2008. The loss on derivative instruments for the year ended December 31, 2008 also includes approximately $1.8 million of hedge ineffectiveness on cash flow hedges due to mismatches in forecasted debt issuance dates, maturity dates and interest rate reset dates of the interest rate and forward starting swaps and related debt.
          Gain on Extinguishment of Debt. In November 2008, we repurchased approximately $46.8 million face value of our Notes due 2026 for approximately $28.8 million. The repurchase resulted in the recognition of a gain on extinguishment of debt of approximately $14.8 million (net of the write-off of approximately $3.1 million in deferred loan fees and unamortized debt discount), which is reflected in our consolidated statements of income.

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Cash Flows
          The following summary discussion of our cash flows is based on the consolidated statements of cash flows in “Financial Statements and Supplementary Data” and is not meant to be an all inclusive discussion of the changes in our cash flows for the periods presented below (in thousands):
                                         
    Six Months Ended June 30,     Years Ended December 31,
    2010   2009     2009   2008   2007
    (unaudited)                        
Net cash provided by operating activities
  $ 63,431     $ 72,685     $ 145,089     $ 115,046     $ 114,965  
Net cash used in investing activities
    (172,398 )     (101,535 )     (157,627 )     (218,661 )     (409,301 )
Net cash provided by financing activities
    110,384       41,529       11,038       111,558       282,151  
Ending cash and cash equivalents balance
    21,339       34,101       19,922       21,422       13,479  
Comparison of the Six Months Ended June 30, 2010 to the Six Months Ended June 30, 2009
          Net cash provided by operating activities decreased $9.3 million to $63.4 million for the six months ended June 30, 2010 compared to $72.7 million for the six months ended June 30, 2009. The decrease was primarily due to a decrease in net income before depreciation and amortization, gains or losses relating to the extinguishment of debt, derivative instruments, and the sale of marketable securities, and from net cash used to fund and settle changes in operating assets and liabilities.
          Net cash used in investing activities increased $70.9 million to $172.4 million for the six months ended June 30, 2010 compared to $101.5 million for the six months ended June 30, 2009. The increase in cash used was primarily due to higher purchases of interests in and additions to investments in real estate and funds held in escrow for acquisitions, partially offset by decreases in contributions to unconsolidated partnerships related to the repayment of outstanding indebtedness by an unconsolidated partnership in 2009.
          Net cash provided by financing activities increased $68.9 million to $110.4 million for the six months ended June 30, 2010 compared to $41.5 million for the six months ended June 30, 2009. The increase was primarily due to the issuance of our Notes due 2030 in January 2010, the issuance of our Notes due 2020 in April 2010 and an increase in proceeds from BioMed Realty Trust, Inc.’s common stock offerings and from our unsecured line of credit, partially offset by the voluntary prepayment of the remaining outstanding indebtedness on our secured term loan, payments on our unsecured line of credit and a decrease in dividends paid as a result of a reset of the dividend rate in 2009.
Comparison of the Year Ended December 31, 2009 to the Year Ended December 31, 2008
          Net cash provided by operating activities increased $30.1 million to $145.1 million for the year ended December 31, 2009 compared to $115.0 million for the year ended December 31, 2008. Net cash provided by operating activities increased primarily due to increases in income before depreciation and amortization, gain on extinguishment of debt and allowance for bad debt, partially offset by changes in operating assets and liabilities and the add back for a non-cash loss on derivative instruments in 2008.
          Net cash used in investing activities decreased $61.1 million to $157.6 million for the year ended December 31, 2009 compared to $218.7 million for the year ended December 31, 2008. The decrease was primarily due to completion of construction activities on several properties, partially offset by a decrease in proceeds from the sale of real estate assets, and contributions to unconsolidated partnerships.
          Net cash provided by financing activities decreased $100.6 million to $11.0 million for the year ended December 31, 2009 compared to $111.6 million for the year ended December 31, 2008. The decrease primarily reflects reduced financing requirements due to reduced construction activity. Cash was generated from the sale of common stock and issuance of mortgage notes during the year ended December 31, 2009 and was used principally to pay down our secured construction loan, which was secured by the Center for Life Science | Boston property. In addition, cash from financing activities was provided by our unsecured line of credit during the year ended December 31, 2009.
Comparison of the Year Ended December 31, 2008 to the Year Ended December 31, 2007
          Net cash provided by operating activities was $115.0 million for the year ended December 31, 2008 and $115.0 million for the year ended December 31, 2007. Net cash provided by operating activities increased primarily due to changes in operating assets and liabilities and the add back for a non-cash loss on derivative instruments in 2008, partially offset by increases in operating income before depreciation and amortization and gain on extinguishment of debt.

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          Net cash used in investing activities decreased $190.6 million to $218.7 million for the year ended December 31, 2008 compared to $409.3 million for the year ended December 31, 2007. The decrease was primarily due to fewer property acquisitions, including those acquired through investments in unconsolidated partnerships, and an increase in proceeds from the sale of real estate assets, partially offset by investments in non-real estate assets (primarily related to our relocation to a new corporate headquarters).
          Net cash provided by financing activities decreased $170.6 million to $111.6 million for the year ended December 31, 2008 compared to $282.2 million for the year ended December 31, 2007. The decrease primarily reflects reduced financing requirements due to reduced acquisition activity. Cash was generated from the sale of common stock during the year ended December 31, 2008 and was used principally to pay down our unsecured line of credit. In addition, cash from financing activities was provided by our unsecured line of credit and our secured construction loan during the year ended December 31, 2008.
Liquidity and Capital Resources
          Our short-term liquidity requirements consist primarily of funds to pay for future distributions expected to be paid to our stockholders, operating expenses and other expenditures directly associated with our properties, interest expense and scheduled principal payments on outstanding mortgage indebtedness, general and administrative expenses, capital expenditures, tenant improvements and leasing commissions.
          The remaining principal payments due for our consolidated and our proportionate share of unconsolidated indebtedness (excluding debt premiums and discounts) as of June 30, 2010 were as follows (in thousands):
                                                         
    2010     2011     2012     2013     2014     Thereafter     Total  
Fixed-rate mortgages
  $ 3,757     $ 29,914     $ 45,414     $ 25,941     $ 353,091     $ 200,720     $ 658,837  
Unsecured line of credit
          170,500                               170,500  
Notes due 2026
                                  21,900       21,900  
Notes due 2030
                                  180,000       180,000  
Notes due 2020
                                  250,000       250,000  
 
                                         
Total consolidated indebtedness
    3,757       200,414       45,414       25,941       353,091       652,620       1,281,237  
Secured acquisition and interim loan facility
          40,650                               40,650  
Secured construction loan
    39,439                                     39,439  
 
                                         
Total unconsolidated indebtedness
    39,439       40,650                               80,089  
 
                                         
Total indebtedness
  $ 43,196     $ 241,064     $ 45,414     $ 25,941     $ 353,091     $ 652,620     $ 1,361,326  
 
                                         
          Our long-term liquidity requirements consist primarily of funds to pay for scheduled debt maturities, construction obligations, renovations, expansions, capital commitments and other non-recurring capital expenditures that need to be made periodically, and the costs associated with acquisitions of properties that we pursue.
          We expect to satisfy our short-term liquidity requirements through our existing working capital and cash provided by our operations, long-term secured and unsecured indebtedness, the issuance of additional equity or debt securities and the use of net proceeds from the disposition of non-strategic assets. Our rental revenues, provided by our leases, generally provide cash inflows to meet our debt service obligations, pay general and administrative expenses, and fund regular distributions. We expect to satisfy our long-term liquidity requirements through our existing working capital, cash provided by operations, long-term secured and unsecured indebtedness, the issuance of additional equity or debt securities and the use of net proceeds from the disposition of non-strategic assets. We also expect to use funds available under our unsecured line of credit to finance acquisition and development activities and capital expenditures on an interim basis. Although we have had recent success in expanding the borrowing capacity on existing indebtedness and in securing additional sources of debt financing, there is continued uncertainty in the credit markets that may negatively impact our ability to access additional debt financing or to refinance existing debt maturities on favorable terms (or at all), which may negatively affect our ability to make acquisitions and fund current and future development and redevelopment projects. In addition, the financial positions of the lenders under our credit facilities may worsen to the point that they default on their obligations to make available to us the funds under those facilities. A continuation of the prolonged downturn in the credit markets may cause us to seek alternative sources of potentially less attractive financing, and may require us to adjust our business plans accordingly.
          In January 2010, we completed the repurchase of $6.3 million face value of our Notes due 2026. The consideration for each $1,000 principal amount of the Notes due 2026 was $1,000, plus accrued and unpaid interest up to, but not including, the date of purchase, totaling approximately $6.3 million.
          On January 11, 2010, we issued $180.0 million aggregate principal amount of our Notes due 2030. The net proceeds from the issuance were utilized to repay a portion of the outstanding indebtedness on our unsecured line of credit and for other general corporate and working capital purposes.

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          During the six months ended June 30, 2010, we issued 951,000 shares of common stock pursuant to equity distribution agreements executed in 2009, raising approximately $15.4 million in net proceeds, after deducting the underwriters’ discount and commissions and estimated offering expenses. The net proceeds were utilized to repay a portion of the outstanding indebtedness on our unsecured line of credit and for other general corporate and working capital purposes.
          On March 31, 2010, we entered into a first amendment to our first amended and restated secured term loan agreement, pursuant to which we voluntarily prepaid $100.0 million of the $250.0 million previously outstanding borrowings, reducing the outstanding borrowings to $150.0 million. The first amendment reduced the total availability under the secured term loan to $150.0 million and amended the terms of the secured term loan to, among other things, release certain of our subject properties as a result of the partial prepayment (previously pledged as security under the secured term loan), and provide revised conditions for the sale and release of other subject properties.
          On April 19, 2010, we completed the issuance of 13,225,000 shares of common stock, including the exercise in full of the underwriters’ over-allotment option with respect to 1,725,000 shares, resulting in net proceeds of approximately $218.8 million, after deducting the underwriters’ discount and commissions and estimated offering expenses. The net proceeds were utilized to repay a portion of the outstanding indebtedness on our unsecured line of credit and for other general corporate and working capital purposes.
          In April 2010, we received investment grade ratings from two ratings agencies. We sought to obtain an investment grade rating to facilitate access to the investment grade unsecured debt market as part of our overall strategy to maximize our financial flexibility and manage our overall cost of capital. On April 29, 2010, we completed the private placement of $250.0 million aggregate principal amount of our Notes due 2020. The terms of the indenture for the Notes due 2020 requires compliance with various financial covenants including limits on the amount of total leverage and secured debt maintained by the operating partnership and which require the operating partnership to maintain minimum levels of debt service coverage.
          On April 29, 2010, we voluntarily prepaid the remaining $150.0 million of outstanding indebtedness on our secured term loan, securing the release of our remaining subject properties.
          In June 2010, we completed the repurchase of $18.0 million face value of our Notes due 2026. The consideration for each $1,000 principal amount of the Notes due 2026 was $1,003, plus accrued and unpaid interest up to, but not including, the date of purchase, totaling approximately $18.3 million. After giving effect to the purchase, approximately $21.9 million aggregate principal amount of the Notes due 2026 was outstanding as of June 30, 2010.
          Under the rules adopted by the SEC regarding registration and offering procedures, if we meet the definition of a “well-known seasoned issuer” under Rule 405 of the Securities Act, we are permitted to file an automatic shelf registration statement that will be immediately effective upon filing. On September 4, 2009, we filed such an automatic shelf registration statement, which may permit us, from time to time, to offer and sell debt securities, common stock, preferred stock, warrants and other securities to the extent necessary or advisable to meet our liquidity needs.
          Our operating partnership’s total capitalization at June 30, 2010 was approximately $3.4 billion and comprised the following:
                         
            Aggregate        
            Principal        
            Amount or        
    Units at     Dollar Value     Percent of Total  
    June 30, 2010     Equivalent     Capitalization  
    (In thousands)  
Debt:
                       
Mortgage notes payable(1)
          $ 658,837       19.5 %
Notes due 2026(2)
            21,900       0.6 %
Notes due 2030
            180,000       5.3 %
Notes due 2020(3)
            250,000       7.4 %
Unsecured line of credit
            170,500       5.0 %
 
                   
Total debt
            1,281,237       37.8 %
Equity:
                       
OP units outstanding(4)
    116,579,459       1,875,763       55.4 %
7.375% Series A preferred units outstanding(5)
    9,200,000       230,000       6.8 %
 
                   
Total equity
            2,105,763       62.2 %
 
                   
Total capitalization
          $ 3,387,000       100.0 %
 
                   
 
(1)   Amount excludes unamortized debt premiums of $6.0 million recorded upon the assumption of the outstanding indebtedness in connection with our purchase of the corresponding properties.

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(2)   Amount excludes unamortized debt discount of $504,000.
 
(3)   Amount excludes unamortized debt discount of $2.5 million.
 
(4)   Includes our operating partnership units and long-term incentive plan units (individually referred to as LTIP units and collectively with the operating partnership units referred to as OP units). Limited partners who have been issued OP units have the right to require the operating partnership to redeem part or all of their OP units, which right with respect to LTIP units, is subject to vesting and the satisfaction of other conditions. We may elect to acquire those OP units in exchange for shares of our common stock on a one-for-one basis, subject to adjustment. At June 30, 2010, 113,578,209 of the outstanding operating partnership units had been issued to BioMed Realty Trust, Inc. upon receipt of the net proceeds from the issuance of an equal number of shares of BioMed Realty Trust, Inc.’s common stock. The closing price of BioMed Realty Trust, Inc.’s common stock was $16.09 per share on the last trading day of the quarter (June 30, 2010).
 
(5)   Based on the liquidation preference of $25.00 per unit for our 7.375% Series A preferred units.
          BioMed Realty Trust, Inc.’s board of directors has adopted a policy of targeting our indebtedness at approximately 50% of our total asset book value. At June 30, 2010, the ratio of debt to total asset book value was approximately 37.5%. However, BioMed Realty Trust, Inc.’s board of directors may from time to time modify our debt policy in light of current economic or market conditions including, but not limited to, the relative costs of debt and equity capital, market conditions for debt and equity securities and fluctuations in the market price of BioMed Realty Trust, Inc.’s common stock. Accordingly, we may increase or decrease our debt to total asset book value ratio beyond the limit described above.
          We may from time to time seek to repurchase or redeem our outstanding debt, BioMed Realty Trust, Inc.’s shares of common stock or preferred stock or other securities in open market purchases, privately negotiated transactions or otherwise. Such repurchases or redemptions, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.
          Our unsecured credit agreement, as amended, provides for borrowing capacity on our unsecured line of credit of $720.0 million with a maturity date of August 1, 2011. Subject to the administrative agent’s reasonable discretion, we may increase the borrowing capacity of the unsecured line of credit to $1.0 billion upon satisfying certain conditions. In addition, we may, in our sole discretion, extend the maturity date of the unsecured line of credit to August 1, 2012 after satisfying certain conditions and paying an extension fee based on the then current facility commitment. The unsecured line of credit bears interest at a floating rate equal to, at our option, either (1) reserve-adjusted LIBOR plus a spread which ranges from 100 to 155 basis points, depending on our leverage, or (2) the higher of (a) the prime rate then in effect plus a spread which ranges from 0 to 25 basis points, or (b) the federal funds rate then in effect plus a spread which ranges from 50 to 75 basis points, in each case, depending on our leverage. We have deferred the loan costs associated with the amendments to the unsecured line of credit, which are being amortized to expense with the unamortized loan costs from the original unsecured line of credit over the remaining term. At June 30, 2010, we had $170.5 million in outstanding borrowings on our unsecured line of credit, with a weighted-average interest rate of 1.6% (excluding the effect of interest rate swaps) and a weighted-average interest rate of 3.0% on the unhedged portion of the outstanding debt of approximately $20.5 million. At June 30, 2010, we had additional borrowing capacity under the unsecured line of credit of up to approximately $537.8 million (net of outstanding letters of credit issued by us and drawable on the unsecured line of credit of approximately $11.7 million).
          The terms of the credit agreement for the unsecured line of credit include certain restrictions and covenants, which limit, among other things, the payment of dividends and the incurrence of additional indebtedness and liens. The terms also require compliance with financial ratios relating to the minimum amounts of net worth, fixed charge coverage, unsecured debt service coverage, the maximum amount of secured, and secured recourse indebtedness, leverage ratio and certain investment limitations. The dividend restriction referred to above provides that, except to enable BioMed Realty Trust, Inc. to continue to qualify as a REIT for federal income tax purposes, we will not make distributions with respect to the OP units or other equity interests in an aggregate amount for the preceding four fiscal quarters in excess of 95% of funds from operations, as defined, for such period, subject to other adjustments. We believe that we were in compliance with the covenants as of June 30, 2010.

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          A summary of our outstanding consolidated mortgage notes payable was as follows (dollars in thousands):
                                     
            Effective            
    Stated Fixed     Interest     Principal Balance      
    Interest Rate     Rate     June 30, 2010     December 31, 2009     Maturity Date
Ardentech Court
    7.25 %     5.06 %   $ 4,296     $ 4,354     July 1, 2012
Bridgeview Technology Park I
    8.07 %     5.04 %     11,172       11,246     January 1, 2011
Center for Life Science | Boston
    7.75 %     7.75 %     347,194       348,749     June 30, 2014
500 Kendall Street (Kendall D)
    6.38 %     5.45 %     65,168       66,077     December 1, 2018
Lucent Drive
    4.75 %     4.75 %     5,015       5,129     January 21, 2015
6828 Nancy Ridge Drive
    7.15 %     5.38 %     6,541       6,595     September 1, 2012
Road to the Cure
    6.70 %     5.78 %     14,828       14,956     January 31, 2014
Science Center Drive
    7.65 %     5.04 %     10,891       10,981     July 1, 2011
Shady Grove Road
    5.97 %     5.97 %     147,000       147,000     September 1, 2016
Sidney Street
    7.23 %     5.11 %     27,867       28,322     June 1, 2012
9865 Towne Centre Drive
    7.95 %     7.95 %     17,762       17,884     June 30, 2013
900 Uniqema Boulevard
    8.61 %     5.61 %     1,103       1,191     May 1, 2015
 
                               
 
                    658,837       662,484      
Unamortized premiums
                    6,030       6,970      
 
                               
 
                  $ 664,867     $ 669,454      
 
                               
          Premiums were recorded upon assumption of the mortgage notes payable at the time of the related acquisition to account for above-market interest rates. Amortization of these premiums is recorded as a reduction to interest expense over the remaining term of the respective note using a method that approximates the effective-interest method.
          As of June 30, 2010, principal payments due for our indebtedness (excluding debt premiums and discounts, and our proportionate share of the indebtedness of our unconsolidated partnerships) were as follows (in thousands):
         
2010
  $ 3,757  
2011
    200,414  
2012
    45,414  
2013
    25,941  
2014
    353,091  
Thereafter(1)
    652,620  
 
     
 
  $ 1,281,237  
 
     
 
(1)   Includes $21.9 million in principal payments of the Notes due 2026 based on a contractual maturity date of October 1, 2026 and $180.0 million in principal payments of the Notes due 2030 based on a contractual maturity date of January 15, 2030.
          We are a party to two interest rate swaps, which hedge the risk of increase in interest rates on our variable rate debt. In addition, we entered into forward starting swaps, which were settled with the corresponding counterparties in April 2009, and resulted in the deferral of interest costs recorded in other comprehensive income, which will be amortized as additional interest expense over the term of the corresponding fixed-rate debt.
          As of June 30, 2010, we had two interest rate swaps with an aggregate notional amount of $150.0 million under which at each monthly settlement date we either (1) receive the difference between a fixed interest rate, which we refer to as the strike rate, and one-month LIBOR if the strike rate is less than LIBOR or (2) pay such difference if the strike rate is greater than LIBOR. Each of the two interest rate swaps hedges our exposure to the variability on expected cash flows attributable to changes in interest rates on the first interest payments, due on the date that is on or closest after each swap’s settlement date, associated with the amount of LIBOR-based debt equal to each swap’s notional amount. One of these interest rate swaps has a notional amount of $35.0 million (interest rate of 5.8%, including the applicable credit spread) and is currently intended to hedge interest payments associated with our unsecured line of credit. The remaining interest rate swap has a notional amount of $115.0 million (interest rate of 5.8%, including the applicable credit spread) and is currently intended to hedge interest payments associated with our unsecured line of credit. No initial investment was made to enter into the interest rate swap agreements.
          As of June 30, 2010, we had deferred interest costs of approximately $59.7 million in other comprehensive income related to forward starting swaps, which were settled with the corresponding counterparties in March and April 2009 for approximately $86.5 million. The forward starting swaps were entered into to mitigate our exposure to the variability in expected future cash flows attributable to changes in future interest rates associated with a forecasted issuance of fixed-rate debt, with interest payments for a minimum of ten years. In June 2009, we closed on $368.0 million in fixed-rate mortgage loans secured by our 9865 Towne Centre Drive and Center for Life Science | Boston properties. The deferred interest costs of $59.7 million will be amortized as additional interest expense over a remaining term of nine years. During the six months ended June 30, 2010, approximately $3.6 million of deferred interest costs were recognized as additional interest expense.

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          Due to our voluntary early prepayment of the remaining balance outstanding on the secured term loan and additional repayment of a portion of the outstanding indebtedness on the unsecured line of credit during the three months ended June 30, 2010, our variable-rate indebtedness fell below the combined notional value of the outstanding interest rate swaps, causing us to be temporarily overhedged. As a result, we reperformed tests to assess the effectiveness of our interest rate swaps. The tests indicated that the $250.0 million interest rate swap was no longer highly effective, resulting in the prospective discontinuance of hedge accounting. From the date that hedge accounting was discontinued, changes in the fair-value associated with this interest rate swap were recorded directly to earnings, resulting in the recognition of a gain of approximately $1.1 million for the three months ended June 30, 2010, which is included as a component of loss on derivative instruments. In addition, we recorded a charge to earnings of approximately $1.1 million associated with this interest rate swap, relating to interest payments to the swap counterparty and hedge ineffectiveness, which is also included as a component of loss on derivative instruments.
          Although the remaining interest rate swaps with an aggregate notional amount of $150.0 million passed the assessment tests and continued to qualify for hedge accounting, we accelerated the reclassification of amounts deferred in accumulated other comprehensive loss to earnings related to the hedged forecasted transactions that became probable of not occurring during the period in which we were overhedged. This resulted in a charge to earnings of approximately $980,000, partially offset by a gain of approximately $647,000 primarily attributable to the elimination of our overhedged status with respect to the interest rate swaps, upon the expiration of the $250.0 million interest rate swap on June 1, 2010.
          During the six months ended June 30, 2010, we recorded total losses on derivative instruments of $347,000 primarily related to the discontinuance of hedge accounting for our former $250.0 million interest rate swap, hedge ineffectiveness on cash flow hedges due to mismatches in maturity dates and interest rate reset dates between the interest rate swaps and corresponding debt and changes in the fair-value of other derivative instruments. During the six months ended June 30, 2009, we recorded a gain on derivative instruments of $303,000 as a result of hedge ineffectiveness on cash flow hedges due to mismatches in the maturity date and the interest rate reset dates between the interest rate swaps and the corresponding debt, and changes in the fair-value of derivatives no longer considered highly effective.
          Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate debt. During the next twelve months, we estimate that an additional $13.3 million will be reclassified from other accumulated comprehensive income as an increase to interest expense. In addition, approximately $582,000 for the six months ended June 30, 2010 and approximately $1.7 million for the six months ended June 30, 2009 of settlement payments on interest rate swaps have been deferred in accumulated other comprehensive loss and will be amortized over the useful lives of the related development or redevelopment projects.
          The following table provides information with respect to our contractual obligations at June 30, 2010, including maturities and scheduled principal repayments, but excluding related unamortized debt premiums. We were not subject to any material capital lease obligations or unconditional purchase obligations as of June 30, 2010.
                                         
Obligation   2010     2011-2012     2013-2014     Thereafter     Total  
    (In thousands)  
Mortgage notes payable(1)
  $ 3,757     $ 75,328     $ 379,032     $ 200,720     $ 658,837  
Notes due 2026(2)
                      21,900       21,900  
Notes due 2030
                      180,000       180,000  
Notes due 2020(3)
                      250,000       250,000  
Unsecured line of credit(4)
          170,500                   170,500  
Share of debt of unconsolidated partnerships(5)
    39,439       40,650                   80,089  
Interest payments on debt obligations(6)
    37,132       136,529       114,392       222,256       510,309  
Construction projects(7)
    1,311                         1,311  
Tenant obligations(8)
    33,615       487                   34,102  
Lease commissions
    974       13       93             1,080  
 
                             
Total
  $ 116,228     $ 423,507     $ 493,517     $ 874,876     $ 1,908,128  
 
                             
 
(1)   Balance excludes $6.0 million of unamortized debt premium.
 
(2)   Balance excludes $504,000 of unamortized debt discount.
 
(3)   Balance excludes $2.5 million of unamortized debt discount.
 
(4)   The unsecured line of credit matures on August 1, 2011, but we may extend the maturity date of the unsecured line of credit to August 1, 2012 after satisfying certain conditions and paying an extension fee based on the then current facility commitment.
 
(5)   A portion of the secured acquisition and interim loan facility was refinanced on February 11, 2009, with a new maturity date of February 10, 2011. Subsequent to June 30, 2010, our PREI joint venture exercised the initial extension option for our secured construction loan, which extended the maturity date of the secured construction loan to February 13, 2011.
 
(6)   Interest payments reflect cash payments that are based on the interest rates in effect and debt balances outstanding on June 30, 2010, excluding the effect of the interest rate swaps on the underlying debt.
 
(7)   Balance includes our proportionate share of the remaining construction project obligations of PREI I LLC.
 
(8)   Committed tenant-related obligations based on executed leases as of June 30, 2010.

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Funds from Operations
          We present funds from operations, or FFO, available to common shares and partnership and LTIP units because we consider it an important supplemental measure of our operating performance and believe it 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 assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because FFO excludes depreciation and amortization unique to real estate, gains and losses from property dispositions and extraordinary items, it 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 and interest costs, providing perspective not immediately apparent from net income. We compute FFO in accordance with standards established by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT, in its March 1995 White Paper (as amended in November 1999 and April 2002). As defined by NAREIT, FFO represents net income (computed in accordance with GAAP), excluding gains (or losses) from sales of property, plus real estate related depreciation and amortization (excluding amortization of loan origination costs) and after adjustments for unconsolidated partnerships and joint ventures. Our computation may differ from the methodology for calculating FFO utilized by other equity REITs and, accordingly, may not be comparable to such other REITs. Further, FFO does not represent amounts available for management’s discretionary use because of needed capital replacement or expansion, debt service obligations, or other commitments and uncertainties. FFO should not be considered as an alternative to net income (loss) (computed in accordance with GAAP) as an indicator of our financial performance or to cash flow from operating activities (computed in accordance with GAAP) as an indicator of our liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to pay dividends or make distributions.
          Our FFO available to common shares and OP units and a reconciliation to net income for the six months ended June 30, 2010 and 2009 and for each of the years in the five-year period ended December 31, 2009 (in thousands, except share data) was as follows:
                                                         
    Six Months Ended June 30,     Year Ended December 31,  
    2010     2009     2009     2008     2007     2006     2005  
Net income available to the unitholders(1)
  $ 8,736     $ 38,599     $ 43,291     $ 46,177     $ 57,019     $ 36,507     $ 18,320  
Adjustments:
                                                       
Gain on sale of real estate assets
                            (1,087 )            
Depreciation and amortization — unconsolidated partnerships
    1,357       1,323       2,647       2,100       1,139       80       50  
Depreciation and amortization — consolidated entities — discontinued operations
                            228       550        
Depreciation and amortization — consolidated entities — continuing operations
    55,385       51,813       109,620       84,227       72,202       65,063       39,378  
Depreciation and amortization — allocable to noncontrolling interest of consolidated joint ventures
    (43 )     (39 )     (81 )     (40 )     (285 )            
 
                                         
Funds from operations available to common shares and OP unitholders
  $ 65,435     $ 91,696     $ 155,477     $ 132,464     $ 129,216     $ 102,200     $ 57,748  
 
                                         
Funds from operations per unit — diluted
  $ 0.60     $ 1.04     $ 1.64     $ 1.76     $ 1.88     $ 1.74     $ 1.37  
 
                                         
Weighted-average units outstanding — diluted(2)
    108,298,135       88,580,072       95,082,074       75,408,153       68,738,694       58,886,694       42,091,195  
 
                                         
 
(1)   Amount is inclusive of net income allocable to our limited partners, which, for purposes of the calculation of FFO for BioMed Realty Trust, Inc., is excluded from net income available to common stockholders and added back as a reconciling item.
 
(2)   The year ended December 31, 2009 includes 1,076,692 unvested OP units which are considered anti-dilutive for purposes of calculating diluted earnings per unit.

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Off-Balance Sheet Arrangements
          As of June 30, 2010, we had investments in the following unconsolidated partnerships: (1) McKellar Court limited partnership, which owns a single tenant occupied property located in San Diego; and (2) two limited liability companies with PREI, which own a portfolio of properties primarily located in Cambridge, Massachusetts (see Note 9 of the Notes to Consolidated Financial Statements included elsewhere herein for more information).
          The McKellar Court partnership is a VIE; however, we are not the primary beneficiary. The limited partner at McKellar Court is the only tenant in the property and will bear a disproportionate amount of any losses. We, as the general partner, will receive 22% of the operating cash flows and 75% of the gains upon sale of the property. We account for our general partner interest using the equity method. The assets of the McKellar Court partnership were $14.9 million and $16.0 million and the liabilities were $10.5 million at June 30, 2010 and December 31, 2009, respectively. Our equity in net income of the McKellar Court partnership was $508,000 and $42,000 for the six months ended June 30, 2010 and 2009, respectively. In December 2009, we provided funding in the form of a promissory note to the McKellar Court partnership in the amount of $10.3 million, which matures at the earlier of (1) January 1, 2020, or (2) the day that the limited partner exercises an option to purchase our ownership interest. Interest-only payments on the promissory note are due monthly at a fixed rate of 8.15% (the rate may adjust higher after January 1, 2015), with the principal balance outstanding due at maturity.
          PREI II LLC is a VIE; however, we are not the primary beneficiary. PREI will bear the majority of any losses incurred. PREI I LLC does not qualify as a VIE. In addition, consolidation is not required as we do not control the limited liability companies. In connection with the formation of the PREI joint ventures in April 2007, we contributed 20% of the initial capital. However, the amount of cash flow distributions that we receive may be more or less based on the nature of the circumstances underlying the cash distributions due to provisions in the operating agreements governing the distribution of funds to each member and the occurrence of extraordinary cash flow events. We account for our member interests using the equity method for both limited liability companies. The assets of the PREI joint ventures were $653.7 million and $636.0 million and the liabilities were $414.3 million and $410.3 million at June 30, 2010 and December 31, 2009, respectively. Our equity in net loss of the PREI joint ventures was $885,000 and $807,000 for the six months ended June 30, 2010 and 2009, respectively.
          We have been the primary beneficiary in five other VIEs, consisting of single-tenant properties in which the tenant has a fixed-price purchase option, which are consolidated and reflected in our consolidated financial statements.

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          Our proportionate share of outstanding debt related to our unconsolidated partnerships is summarized below (dollars in thousands):
                                         
                    Principal Amount(1)        
    Ownership         June 30,     December 31,        
Name   Percentage     Interest Rate(2)     2010     2009     Maturity Date  
PREI I and PREI II(3)
    20 %     3.85 %   $ 40,650     $ 40,650     February 10, 2011
PREI I(4)
    20 %     3.95 %     39,439       38,415     August 13, 2010(5)
 
                                   
Total
                  $ 80,089     $ 79,065          
 
                                   
 
(1)   Amount represents our proportionate share of the total outstanding indebtedness for each of the unconsolidated partnerships.
 
(2)   Effective or weighted average interest rate of the outstanding indebtedness as of June 30, 2010, including the effect of interest rate swaps.
 
(3)   Amount at June 30, 2010 represents our proportionate share of the total draws outstanding under a secured acquisition and interim loan facility, which bore interest at a LIBOR-indexed variable rate. A portion of the secured acquisition and interim loan facility was utilized by both PREI I LLC and PREI II LLC to acquire a portfolio of properties (initial borrowings of approximately $427.0 million) on April 4, 2007 (see Note 7 in the accompanying consolidated financial statements). On February 11, 2009, our PREI joint ventures jointly refinanced the outstanding balance of the secured acquisition and interim loan facility, or approximately $364.1 million, with the proceeds of a new loan totaling $203.3 million and members’ capital contributions funding the balance due. The new loan bears interest at a rate equal to, at the option of our PREI joint ventures, either (a) reserve adjusted LIBOR plus 350 basis points or (b) the higher of (i) the prime rate then in effect, (ii) the federal funds rate then in effect plus 50 basis points or (iii) one-month LIBOR plus 450 basis points, and requires interest only monthly payments until the maturity date, February 10, 2011.
 
(4)   Amount represents our proportionate share of a secured construction loan, which bears interest at a LIBOR-indexed variable rate. The secured construction loan was executed by a wholly owned subsidiary of PREI I LLC in connection with the construction of the 650 East Kendall Street property (initial borrowings of $84.0 million on February 13, 2008 were used in part to repay a portion of the secured acquisition and interim loan facility). The remaining balance is being utilized to fund construction costs at the property.
 
(5)   Subsequent to June 30, 2010, our PREI joint venture exercised the initial extension option, which extended the maturity date of the secured construction loan to February 13, 2011.
Cash Distribution Policy
          BioMed Realty Trust, Inc. has elected to be taxed as a REIT under the Code commencing with the taxable year ended December 31, 2004. To qualify as a REIT, BioMed Realty Trust, Inc. must meet a number of organizational and operational requirements, including the requirement that we distribute currently at least 90% of our ordinary taxable income to BioMed Realty Trust, Inc.’s stockholders. It is our intention to comply with these requirements and maintain BioMed Realty Trust, Inc.’s REIT status. As a REIT, BioMed Realty Trust, Inc. generally will not be subject to corporate federal, state or local income taxes on taxable income BioMed Realty Trust, Inc. distributes currently (in accordance with the Code and applicable regulations) to BioMed Realty Trust, Inc.’s stockholders. If BioMed Realty Trust, Inc. fails to qualify as a REIT in any taxable year, we will be subject to federal, state and local income taxes at regular corporate rates and BioMed Realty Trust, Inc. may not be able to qualify as a REIT for subsequent tax years. Even if BioMed Realty Trust, Inc. qualifies as a REIT for federal income tax purposes, we may be subject to certain state and local taxes on our income and to federal income and excise taxes on our undistributed taxable income, i.e., taxable income not distributed in the amounts and in the time frames prescribed by the Code and applicable regulations thereunder.
          In April 2009, in an effort to maintain financial flexibility in light of the current capital markets environment, we reset our annual dividend rate on shares of BioMed Realty Trust, Inc.’s common stock and the annual distribution rate on BioMed Realty, L.P.’s common units to $0.44 per share or unit, starting in the second quarter of 2009. We subsequently increased these rates to $0.56 per share or unit, starting in the fourth quarter of 2009 and again to $0.60 per share or unit, starting in the second quarter of 2010. While this change in our dividend and distribution levels represents our current expectation, the actual dividend or distribution payable will be determined by BioMed Realty Trust, Inc.’s board of directors based upon the circumstances at the time of declaration and, as a result, the actual dividend or distribution payable may vary from such expected amount. The decision to declare and pay dividends on shares of BioMed Realty Trust, Inc.’s common stock or distributions to BioMed Realty, L.P.’s common units in the future, as well as the timing, amount and composition of any such future dividends, will be at the sole discretion of BioMed Realty Trust, Inc.’s board of directors in light of conditions then existing, including our earnings, financial condition, capital requirements, debt maturities, the availability of debt and equity capital, applicable REIT and legal restrictions and the general overall economic conditions and other factors.

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          The following table provides historical information for dividends paid on BioMed Realty Trust, Inc.’s common and preferred stock and distributions made on BioMed Realty, L.P.’s common and preferred units for the prior two fiscal years and the six months ended June 30, 2010:
                         
            Dividend/Distribution     Dividend/Distribution
per Preferred
 
Quarter Ended   Date Declared   Date Paid   per Common Share/Unit     Share/Unit  
March 31, 2008
  March 14, 2008   April 15, 2008   $ 0.3350     $ 0.46094  
June 30, 2008
  June 16, 2008   July 15, 2008     0.3350       0.46094  
September 30, 2008
  September 15, 2008   October 15, 2008     0.3350       0.46094  
December 31, 2008
  December 15, 2008   January 15, 2009     0.3350       0.46094  
March 31, 2009
  March 16, 2009   April 15, 2009     0.3350       0.46094  
June 30, 2009
  June 15, 2009   July 15, 2009     0.1100       0.46094  
September 30, 2009
  September 15, 2009   October 15, 2009     0.1100       0.46094  
December 31, 2009
  December 15, 2009   January 15, 2010     0.1400       0.46094  
March 31, 2010
  March 15, 2010   April 15, 2010     0.1400       0.46094  
June 30, 2010
  June 15, 2010   July 15, 2010     0.1500       0.46094  
Inflation
          Some of our leases contain provisions designed to mitigate the adverse impact of inflation. These provisions generally increase rental rates during the terms of the leases either at fixed rates or indexed escalations (based on the Consumer Price Index or other measures). We may be adversely impacted by inflation on the leases that do not contain indexed escalation provisions. In addition, most of our leases require the tenant to pay an allocable share of operating expenses, including common area maintenance costs, real estate taxes and insurance. This may reduce our exposure to increases in costs and operating expenses resulting from inflation, assuming our properties remain leased and tenants fulfill their obligations to reimburse us for such expenses.
          Portions of our unsecured line of credit and the secured construction loan held by our unconsolidated partnership bear interest at a variable rate, which will be influenced by changes in short-term interest rates, and will be sensitive to inflation.
Quantitative and Qualitative Disclosures About Market Risk
          Our future income, cash flows and fair-values relevant to financial instruments depend upon prevailing market interest rates. Market risk is the exposure to loss resulting from changes in interest rates, foreign currency exchange rates, commodity prices and equity prices. The primary market risk to which we believe we are exposed is interest rate risk. Many factors, including governmental monetary and tax policies, domestic and international economic and political considerations and other factors that are beyond our control contribute to interest rate risk.
          As of June 30, 2010, our consolidated debt consisted of the following (dollars in thousands):
                         
                    Effective  
                    Interest  
            Percent of     Rate at  
    Principal Balance(1)     Total Debt     June 30, 2010  
Fixed interest rate(2)
  $ 1,113,738       86,7 %     6.18 %
Variable interest rate(3)
    170,500       13.3 %     1.64 %
 
                   
Total/weighted-average effective interest rate
  $ 1,284,238       100.0 %     5.58 %
 
                   
 
(1)   Principal balance includes only consolidated indebtedness.
 
(2)   Includes nine mortgage notes payable secured by certain of our properties (including $6.0 million of unamortized premium), our Notes due 2026 (including $504,000 of unamortized debt discount), our Notes due 2030, and our Notes due 2020 (including $2.5 million of unamortized debt discount).
 
(3)   Includes our unsecured line of credit, which bears interest based at a LIBOR-indexed variable interest rate, plus a credit spread. The stated effective rate for the variable interest debt excludes the impact of any interest rate swap agreements. We have entered into two interest rate swaps, which were intended to have the effect of initially fixing the interest rates on $150.0 million of our variable rate debt at a weighted average interest rate of 4.7% (excluding applicable credit spreads for the underlying debt).

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          To determine the fair-value of our outstanding consolidated indebtedness, we utilize quoted market prices to estimate the fair-value, when available. If quoted market prices are not available, we calculate the fair-value of our mortgage notes payable and other fixed-rate debt based on an estimate of current lending rates, assuming the debt is outstanding through maturity and considering the notes’ collateral. In determining the current market rate for fixed-rate debt, a market credit spread is added to the quoted yields on federal government treasury securities with similar terms to the debt. In determining the current market rate for variable-rate debt, a market credit spread is added to the current effective interest rate. At June 30, 2010, the fair-value of the fixed-rate debt was estimated to be $1.2 billion compared to the net carrying value of $1.1 billion (includes $6.0 million of unamortized debt premium, $504,000 of unamortized debt discount associated with our Notes due 2026, and $2.5 million of unamortized debt discount associated with our Notes due 2020). At June 30, 2010, the fair-value of the variable-rate debt was estimated to be $165.4 million compared to the net carrying value of $170.5 million. We do not believe that the interest rate risk represented by our fixed-rate debt or the risk of changes in the credit spread related to our variable-rate debt was material as of June 30, 2010 in relation to total assets of $3.4 billion and equity market capitalization of $2.1 billion of BioMed Realty Trust, Inc.’s common stock and preferred stock and BioMed Realty, L.P.’s operating partnership and LTIP units.
          Based on the outstanding unhedged balances of our unsecured line of credit and our proportionate share of the outstanding balance for the PREI joint ventures’ secured construction loan at June 30, 2010, a 1% change in interest rates would change our interest costs by approximately $273,000 per year. This amount was determined by considering the impact of hypothetical interest rates on our financial instruments. This analysis does not consider the effect of any change in overall economic activity that could occur in that environment. Further, in the event of a change of the magnitude discussed above, we may take actions to further mitigate our exposure to the change. However, due to the uncertainty of the specific actions that would be taken and their possible effects, this analysis assumes no changes in our financial structure.
          In order to modify and manage the interest rate characteristics of our outstanding debt and to limit the effects of interest rate risks on our operations, we may utilize a variety of financial instruments, including interest rate swaps, caps and treasury locks in order to mitigate our interest rate risk on a related financial instrument. The use of these types of instruments to hedge our exposure to changes in interest rates carries additional risks, including counterparty credit risk, the enforceability of hedging contracts and the risk that unanticipated and significant changes in interest rates will cause a significant loss of basis in the contract. To limit counterparty credit risk we will seek to enter into such agreements with major financial institutions with high credit ratings. There can be no assurance that we will be able to adequately protect against the foregoing risks and will ultimately realize an economic benefit that exceeds the related amounts incurred in connection with engaging in such hedging activities. We do not enter into such contracts for speculative or trading purposes.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
          Not Applicable.

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BUSINESS AND PROPERTIES
Business
General
          We operate as a REIT focused on acquiring, developing, owning, leasing and managing laboratory and office space for the life science industry. Our tenants primarily include biotechnology and pharmaceutical companies, scientific research institutions, government agencies and other entities involved in the life science industry. Our properties are generally located in markets with well established reputations as centers for scientific research, including Boston, San Diego, San Francisco, Seattle, Maryland, Pennsylvania and New York/New Jersey.
          BioMed Realty Trust, Inc. was incorporated in Maryland on April 30, 2004 and commenced operations on August 11, 2004, after completing its initial public offering. BioMed Realty, L.P. was organized in the state of Maryland on April 30, 2004. At June 30, 2010, our portfolio consisted of 73 properties, representing 120 buildings with an aggregate of approximately 11.0 million rentable square feet.
          Our senior management team has significant experience in the real estate industry, principally focusing on properties designed for life science tenants. We operate as a fully integrated, self-administered and self-managed REIT, providing property management, leasing, development and administrative services to our properties. As of June 30, 2010, we had 139 employees.
Recent Developments
     On July 15, 2010, we acquired a property located at 4775 and 4785 Executive Drive in San Diego, California for approximately $27.2 million, including a laboratory/office building currently under construction totaling approximately 57,000 square feet and an undeveloped land parcel with permits in place for a second building totaling approximately 102,000 square feet.
          On July 20, 2010, we acquired a property located at 3500 Paramount Parkway in Morrisville, North Carolina for approximately $17.5 million, comprising a fully-leased laboratory/office building totaling approximately 61,600 square feet.
Growth Strategy
          Our success and future growth potential are based upon the specialized real estate opportunities within the life science industry. Our growth strategy is designed to meet the sizable demand and specialized requirements of life science tenants by leveraging the knowledge and expertise of a management team focused on serving this large and growing industry.
Our internal growth strategy includes:
    negotiating leases with contractual rental rate increases in order to provide predictable and consistent earnings growth,
 
    creating strong relationships with our tenants to enable us to identify and capitalize on opportunities to renew or extend existing leases or to provide expansion space,
 
    redeveloping currently owned non-laboratory space into higher yielding laboratory facilities, and
 
    developing new laboratory and office space on land we have acquired for development.
 
Our external growth strategy includes:
 
    acquiring well-located properties leased to high-quality life science tenants with attractive in-place yields and long-term growth potential,
 
    investing in properties with leasing opportunities, capitalizing on our industry relationships to enter into new leases, and
 
    investing in redevelopment and development projects, capitalizing on our development platform that we believe will serve as an additional catalyst for future growth.

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Target Markets
          Our target markets — Boston, San Diego, San Francisco, Seattle, Maryland, Pennsylvania, New York/New Jersey and research parks near or adjacent to universities — have emerged as the primary hubs for research, development and production in the life science industry. Each of these markets benefits from the presence of mature life science companies, which provide scale and stability to the market, as well as academic and university environments and government entities to contribute innovation, research, personnel and capital to the private sector. In addition, the clustered research environments within these target markets typically provide a high quality of life for the research professionals and a fertile ground for new life science ideas and ventures.
Positive Life Science Industry Trends
We expect continued long-term growth in the life science industry due to several factors:
    the aging of the U.S. population resulting from the transition of baby boomers to senior citizens, which has increased the demand for new drugs and health care treatment alternatives to extend, improve and enhance their quality of life,
 
    the high level of research and development expenditures, as represented by a Pharmaceutical Research and Manufacturers of America (PhRMA) survey indicating that research and development spending by U.S. pharmaceutical research and biotechnology companies climbed to a record $65.3 billion in 2009, and
 
    escalating health care costs, which drive the demand for better drugs, less expensive treatments and more services in an attempt to manage such costs.
          We are uniquely positioned to benefit from these favorable long-term dynamics through the demand for space for research, development and production by our life science industry tenants.
Experienced Management
          We have created and continue to develop a premier life science real estate-oriented management team, dedicated to maximizing current and long-term returns for our stockholders. Our executive officers have acquired, developed, financed, owned, leased or managed in excess of $4.6 billion in life science real estate. Through this experience, our management team has established extensive industry relationships among life science tenants, property owners and real estate brokers. In addition, our experienced independent board members provide management with a broad range of knowledge in real estate, the sciences, life science company operations, and large public company finance and management.
Regulation
General
          Our properties are subject to various laws, ordinances and regulations, including regulations relating to common areas. We believe that we have the necessary permits and approvals to operate each of our properties.
Americans with Disabilities Act
          Our properties must comply with Title III of the Americans with Disabilities Act, or ADA, to the extent that such properties are “public accommodations” as defined by the ADA. The ADA may require removal of structural barriers to access by persons with disabilities in certain public areas of our properties where such removal is readily achievable. We believe that our properties are in substantial compliance with the ADA and that we will not be required to make substantial capital expenditures to address the requirements of the ADA. The tenants are generally responsible for any additional amounts required to conform their construction projects to the ADA. However, noncompliance with the ADA could result in imposition of fines or an award of damages to private litigants. The obligation to make readily achievable accommodations is an ongoing one, and we will continue to assess our properties and to make alterations as appropriate in this respect.
Environmental Matters
          Under various federal, state and local environmental laws and regulations, a current or previous owner, operator or tenant of real estate may be required to investigate and remediate releases or threats of releases of hazardous or toxic substances or petroleum products at such property, and may be held liable for property damage, personal injury damages and investigation, clean-up and monitoring costs incurred in connection with the actual or threatened contamination. Such laws typically impose clean-up responsibility and liability without regard to fault, or whether the owner, operator or tenant knew of or caused the presence of the

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contamination. The liability under such laws may be joint and several for the full amount of the investigation, clean-up and monitoring costs incurred or to be incurred or actions to be undertaken, although a party held jointly and severally liable may obtain contributions from the other identified, solvent, responsible parties of their fair share toward these costs. These costs may be substantial, and can exceed the value of the property. The presence of contamination, or the failure to properly remediate contamination, on a property may adversely affect the ability of the owner, operator or tenant to sell or rent that property or to borrow using such property as collateral, and may adversely impact our investment in that property.
          Federal asbestos regulations and certain state laws and regulations require building owners and those exercising control over a building’s management to identify and warn, via signs, labels or other notices, of potential hazards posed by the actual or potential presence of asbestos-containing materials, or ACMs, in their building. The regulations also set forth employee training, record-keeping and due diligence requirements pertaining to ACMs and potential ACMs. Significant fines can be assessed for violating these regulations. Building owners and those exercising control over a building’s management may be subject to an increased risk of personal injury lawsuits by workers and others exposed to ACMs and potential ACMs as a result of these regulations. The regulations may affect the value of a building containing ACMs and potential ACMs in which we have invested. Federal, state and local laws and regulations also govern the removal, encapsulation, disturbance, handling and/or disposal of ACMs and potential ACMs when such materials are in poor condition or in the event of construction, remodeling, renovation or demolition of a building. Such laws may impose liability for improper handling or a release to the environment of ACMs and potential ACMs and may provide for fines to, and for third parties to seek recovery from, owners or operators of real properties for personal injury or improper work exposure associated with ACMs and potential ACMs. See “Risk Factors — Risks Related to the Real Estate Industry — We could incur significant costs related to governmental regulation and private litigation over environmental matters involving asbestos-containing materials, which could adversely affect our operations, the value of our properties, and our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders” above.
          Federal, state and local environmental laws and regulations also require removing or upgrading certain underground storage tanks and regulate the discharge of storm water, wastewater and other pollutants; the emission of air pollutants; the generation, management and disposal of hazardous or toxic chemicals, substances or wastes; and workplace health and safety. Life science industry tenants, including certain of our tenants, engage in various research and development activities involving the controlled use of hazardous materials, chemicals, biological and radioactive compounds. Although we believe that the tenants’ activities involving such materials comply in all material respects with applicable laws and regulations, the risk of contamination or injury from these materials cannot be completely eliminated. In the event of such contamination or injury, we could be held liable for any damages that result, and any such liability could exceed our resources and our environmental remediation insurance coverage. Licensing requirements governing use of radioactive materials by tenants may also restrict the use of or ability to transfer space in buildings we own. See “Risk Factors — Risks Related to the Real Estate Industry — We could incur significant costs related to government regulation and private litigation over environmental matters involving the presence, discharge or threat of discharge of hazardous or toxic substances, which could adversely affect our operations, the value of our properties, and our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders” above.
          In addition, our leases generally provide that (1) the tenant is responsible for all environmental liabilities relating to the tenant’s operations, (2) we are indemnified for such liabilities and (3) the tenant must comply with all environmental laws and regulations. Such a contractual arrangement, however, does not eliminate our statutory liability or preclude claims against us by governmental authorities or persons who are not parties to such an arrangement. Noncompliance with environmental or health and safety requirements may also result in the need to cease or alter operations at a property, which could affect the financial health of a tenant and its ability to make lease payments. In addition, if there is a violation of such a requirement in connection with a tenant’s operations, it is possible that we, as the owner of the property, could be held accountable by governmental authorities (or other injured parties) for such violation and could be required to correct the violation and pay related fines. In certain situations, we have agreed to indemnify tenants for conditions preceding their lease term, or that do not result from their operations.
          Prior to closing any property acquisition, we obtain environmental assessments in a manner we believe prudent in order to attempt to identify potential environmental concerns at such properties. These assessments are carried out in accordance with an appropriate level of due diligence and generally include a physical site inspection, a review of relevant federal, state and local environmental and health agency database records, one or more interviews with appropriate site-related personnel, review of the property’s chain of title and review of historic aerial photographs and other information on past uses of the property. We may also conduct limited subsurface investigations and test for substances of concern where the results of the first phase of the environmental assessments or other information indicate possible contamination or where our consultants recommend such procedures.
          While we may purchase our properties on an “as is” basis, most of our purchase contracts contain an environmental contingency clause, which permits us to reject a property because of any environmental hazard at such property. We receive environmental reports on all prospective properties.

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          We believe that our properties comply in all material respects with all federal and state regulations regarding hazardous or toxic substances and other environmental matters.
Insurance
          We carry comprehensive general liability, fire and extended coverage, terrorism and loss of rental income insurance covering all of our properties under a blanket portfolio policy, with the exception of property insurance on our McKellar Court and Science Center Drive properties in San Diego and 9911 Belward Campus Drive and Shady Grove Road properties in Maryland, which is carried directly by the tenants in accordance with the terms of their respective leases, and builders’ risk policies for any projects under construction. In addition, we carry workers’ compensation coverage for injury to our employees. We believe the policy specifications and insured limits are adequate given the relative risk of loss, cost of the coverage and standard industry practice. We also carry environmental remediation insurance for our properties. This insurance, subject to certain exclusions and deductibles, covers the cost to remediate environmental damage caused by unintentional future spills or the historic presence of previously undiscovered hazardous substances, as well as third-party bodily injury and property damage claims related to the release of hazardous substances. We intend to carry similar insurance with respect to future acquisitions as appropriate. A substantial portion of our properties are located in areas subject to earthquake loss, such as San Diego and San Francisco, California and Seattle, Washington. Although we presently carry earthquake insurance on our properties, the amount of earthquake insurance coverage we carry may not be sufficient to fully cover losses from earthquakes. In addition, we may discontinue earthquake, terrorism or other insurance, or may elect not to procure such insurance, on some or all of our properties in the future if the cost of the premiums for any of these policies exceeds, in our judgment, the value of the coverage discounted for the risk of loss. See “Risk Factors — Risks Related to the Real Estate Industry — Uninsured and underinsured losses could adversely affect our operating results and our ability to make payments with respect to the notes or distributions to BioMed Realty, L.P.’s unitholders or BioMed Realty Trust, Inc.’s stockholders” above.
Competition
          We face competition from various entities for investment opportunities in properties for life science tenants, including other REITs, such as health care REITs and suburban office property REITs, pension funds, insurance companies, investment funds and companies, partnerships, and developers. Because properties designed for life science tenants typically contain improvements that are specific to tenants operating in the life science industry, we believe that we will be able to maximize returns on investments as a result of:
    our expertise in understanding the real estate needs of life science industry tenants,
 
    our ability to identify, acquire and develop properties with generic laboratory infrastructure that appeal to a wide range of life science industry tenants, and
 
    our expertise in identifying and evaluating life science industry tenants.
          However, some of our competitors have greater financial resources than we do and may be able to accept more risks, including risks with respect to the creditworthiness of a tenant or the geographic proximity of its investments. In the future, competition from these entities may reduce the number of suitable investment opportunities offered to us or increase the bargaining power of property owners seeking to sell. Further, as a result of their greater resources, those entities may have more flexibility than we do in their ability to offer rental concessions to attract tenants. These concessions could put pressure on our ability to maintain or raise rents and could adversely affect our ability to attract or retain tenants. Additionally, our ability to compete depends upon, among other factors, trends of the national and local economies, investment alternatives, financial condition and operating results of current and prospective tenants, availability and cost of capital, construction and renovation costs, taxes, governmental regulations, legislation and population trends.
Foreign Operations
          We do not engage in any foreign operations or derive any revenue from foreign sources.

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Legal Proceedings
          Although we are involved in legal proceedings arising in the ordinary course of business, we are not currently a party to any legal proceedings nor, to our knowledge, is any legal proceeding threatened against us that we believe would have a material adverse effect on our financial position, results of operations or liquidity.
Offices
          Our principal offices are located at 17190 Bernardo Center Drive, San Diego, California 92128. Our telephone number at that location is (858) 485-9840.
Reports to Security Holders
          BioMed Realty Trust, Inc. is required to send an annual report to its securityholders and to our operating partnership’s unitholders.
How to Obtain Our SEC Filings
          All reports we will file with the SEC will be available free of charge via EDGAR through the SEC’s website at http://www.sec.gov. In addition, the public may read and copy materials we file with the SEC at the SEC’s public reference room located at 100 F Street, N.E., Washington, D.C. 20549. We make available through our website at www.biomedrealty.com our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to such reports filed or furnished pursuant to Sections 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. The information found on, or otherwise accessible through, our website is not incorporated by reference into, nor does it form a part of, this registration statement, or any other documents that we file with the SEC. You can also access on our website our Code of Business Conduct and Ethics, Corporate Governance Guidelines, Audit Committee Charter, Compensation Committee Charter, and Nominating and Corporate Governance Committee Charter.
Properties
Existing Portfolio
          At June 30, 2010, our portfolio consisted of 73 properties, representing 120 buildings with an aggregate of approximately 11.0 million rentable square feet. Except as otherwise indicated, we own all of the properties in our portfolio through wholly-owned subsidiaries of our operating partnership and the properties are held in fee.
          The following reflects the classification of our properties between stabilized (operating properties in which more than 90% of the rentable square footage is under lease), lease up (operating properties in which less than 90% of the rentable square footage is under lease), pre-development (development properties that are engaged in activities related to planning, entitlement, or other preparations for future construction), development (properties that are currently under development through ground up construction), redevelopment properties (properties that are currently being prepared for their intended use) and land parcels (representing management’s estimates of rentable square footage if development of these properties was undertaken) at June 30, 2010:
                                                                         
    Consolidated Portfolio     Unconsolidated Partnership Portfolio     Total Portfolio  
                    Percent of                     Percent of                     Percent of  
            Rentable     Rentable             Rentable     Rentable             Rentable     Rentable  
            Square     Square             Square     Square             Square     Square  
    Properties     Feet     Feet Leased     Properties     Feet     Feet Leased     Properties     Feet     Feet Leased  
Stabilized
    44       5,732,015       98.8 %     4       257,268       100.0 %     48       5,989,283       98.9 %
Lease up
    19       2,638,112       65.0 %     2       417,290       58.4 %     21       3,055,402       64.1 %
 
                                                           
Current operating portfolio
    63       8,370,127       88.1 %     6       674,558       74.3 %     69       9,044,685       87.1 %
Long-term lease up
    1       1,389,517       26.6 %                 n/a       1       1,389,517       26.6 %
 
                                                           
Total operating portfolio
    64       9,759,644       79.4 %     6       674,558       74.3 %     70       10,434,202       79.1 %
Development
    1       176,000       100.0 %     1       280,000             2       456,000       38.6 %
Redevelopment
                n/a                   n/a                   n/a  
Pre-development
    1       152,145                         n/a       1       152,145        
 
                                                           
Total portfolio
    66       10,087,789       78.8 %     7       954,558       52.5 %     73       11,042,347       76.5 %
Land parcels
    n/a       1,577,000       n/a                   n/a       n/a       1,577,000       n/a  
 
                                                           
Total pro forma portfolio
    66       11,664,789       n/a       7       954,558       n/a       73       12,619,347       n/a  
 
                                                           

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The properties we owned or had an ownership interest in, at June 30, 2010, were as follows:
                                                 
                            Percent of           Percent
    Acquisition           Rentable   Rentable Sq   Leased   Leased
Property   Date   Property Status   Square Feet (1)   Feet   Square Feet   (6/30/10)
 
Boston
                                               
Albany Street
  May 31, 2005   Stabilized     75,003       0.7 %     75,003       100.0 %
Center for Life Science | Boston
  November 17, 2006   Stabilized     704,159       6.9 %     641,438       91.1 %
Charles Street
  April 7, 2006   Stabilized     47,912       0.5 %     47,912       100.0 %
Coolidge Avenue
  April 5, 2005   Lease Up     37,400       0.4 %     12,972       34.7 %
21 Erie Street
  May 31, 2005   Stabilized     48,627       0.5 %     48,627       100.0 %
40 Erie Street
  May 31, 2005   Stabilized     100,854       1.0 %     100,854       100.0 %
47 Erie Street Parking Structure
  May 31, 2005   Stabilized   447 Stalls     n/a     447 Stalls     n/a  
Fresh Pond Research Park
  April 5, 2005   Lease Up     90,702       0.9 %     66,696       73.5 %
675 W. Kendall Street (Kendall A)
  May 31, 2005   Stabilized     302,919       3.0 %     298,871       98.7 %
500 Kendall Street (Kendall D)
  May 31, 2005   Stabilized     349,325       3.5 %     345,497       98.9 %
Sidney Street
  May 31, 2005   Stabilized     191,904       1.9 %     191,904       100.0 %
Vassar Street
  May 31, 2005   Stabilized     52,520       0.5 %     52,520       100.0 %
                           
 
                                               
Total Boston
                    2,001,325       19.8 %     1,882,294       94.1 %
                           
 
                                               
Maryland
                                               
Beckley Street
  December 17, 2004   Stabilized     77,225       0.8 %     77,225       100.0 %
9911 Belward Campus Drive
  May 24, 2006   Stabilized     289,912       2.9 %     289,912       100.0 %
9920 Belward Campus Drive
  May 8, 2007   Stabilized     51,181       0.5 %     51,181       100.0 %
Medical Center Drive
  May 3, 2010   Stabilized     217,983       2.2 %     217,983       100.0 %
Shady Grove Road
  May 24, 2006   Stabilized     635,058       6.3 %     635,058       100.0 %
Tributary Street
  December 17, 2004   Stabilized     91,592       0.9 %     91,592       100.0 %
50 West Watkins Mill Road
  May 7, 2010   Stabilized     57,410       0.6 %     57,410       100.0 %
55 / 65 West Watkins Mill Road
  February 23, 2010   Stabilized     82,405       0.8 %     82,405       100.0 %
                           
 
                                               
Total Maryland
                    1,502,766       15.0 %     1,502,766       100.0 %
                           
 
                                               
San Diego
                                               
Balboa Avenue
  August 13, 2004   Stabilized     35,344       0.4 %     35,344       100.0 %
Bernardo Center Drive
  August 13, 2004   Stabilized     61,286       0.6 %     61,286       100.0 %
Faraday Avenue
  September 19, 2005   Stabilized     28,704       0.3 %     28,704       100.0 %
Gazelle Court
  March 30, 2010   Development     176,000       1.7 %     176,000       100.0 %
John Hopkins Court
  August 16, 2006   Lease Up     72,192       0.7 %     21,470       29.7 %
6114-6154 Nancy Ridge Drive
  May 2, 2007   Stabilized     196,557       1.9 %     196,557       100.0 %
6828 Nancy Ridge Drive
  April 21, 2005   Lease Up     42,138       0.4 %     24,431       58.0 %
Pacific Center Boulevard
  August 24, 2007   Stabilized     66,745       0.7 %     66,745       100.0 %
Road to the Cure
  December 14, 2006   Lease Up     67,998       0.7 %     54,104       79.6 %
San Diego Science Center
  October 21, 2004   Lease Up     105,364       1.0 %     80,126       76.0 %
Science Center Drive
  September 24, 2004   Stabilized     53,740       0.5 %     53,740       100.0 %
Sorrento Valley Boulevard
  December 7, 2006   Stabilized     54,924       0.5 %     54,924       100.0 %
Torreyana Road
  March 22, 2007   Stabilized     81,204       0.8 %     81,204       100.0 %

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                            Percent of           Percent
    Acquisition           Rentable   Rentable Sq   Leased   Leased
Property   Date   Property Status   Square Feet (1)   Feet   Square Feet   (6/30/10)
 
9865 Towne Centre Drive
  August 12, 2004   Stabilized     94,866       0.9 %     94,866       100.0 %
9885 Towne Centre Drive
  August 12, 2004   Stabilized     104,870       1.0 %     104,870       100.0 %
Waples Street
  March 1, 2005   Stabilized     50,055       0.5 %     50,055       100.0 %
                           
 
                                               
Total San Diego
                    1,291,987       12.6 %     1,184,426       91.7 %
                           
 
                                               
New York / New Jersey
                                               
Graphics Drive
  March 17, 2005   Lease Up     72,300       0.7 %     18,574       25.7 %
Landmark at Eastview
  August 12, 2004   Lease Up     743,025       7.4 %     618,977       83.3 %
Landmark at Eastview II
  August 12, 2004   Stabilized     360,520       3.6 %     360,520       100 %
One Research Way
  May 31, 2006   Lease Up     49,421       0.5 %            
                           
 
                                               
Total New York / New Jersey
                    1,225,266       12.2 %     998,071       81.5 %
                           
 
                                               
San Francisco
                                               
Ardentech Court
  November 18, 2004   Stabilized     55,588       0.6 %     55,588       100.0 %
Ardenwood Venture(2)
  June 14, 2006   Lease Up     72,500       0.7 %     27,620       38.1 %
Bayshore Boulevard
  August 17, 2004   Stabilized     183,344       1.8 %     183,344       100.0 %
Bridgeview Technology Park I
  September 10, 2004   Lease Up     201,567       2.0 %     125,144       62.1 %
Bridgeview Technology Park II
  March 16, 2005   Lease Up     50,400       0.5 %            
Dumbarton Circle
  May 27, 2005   Stabilized     44,000       0.4 %     44,000       100.0 %
Eccles Avenue
  December 1, 2005   Pre-development     152,145       1.5 %            
Forbes Boulevard
  September 5, 2007   Stabilized     237,984       2.4 %     237,984       100.0 %
Industrial Road
  August 17, 2004   Lease Up     171,965       1.7 %     144,105       83.8 %
Kaiser Drive
  August 25, 2005   Lease Up     87,953       0.9 %     50,000       56.8 %
Pacific Research Center
  July 11, 2006   Lease Up     1,389,517       13.8 %     369,342       26.6 %
                           
 
                                               
Total San Francisco
                    2,646,963       26.3 %     1,237,127       46.7 %
                           
 
                                               
Pennsylvania
                                               
Eisenhower Road
  August 13, 2004   Lease Up     27,750       0.3 %     16,565       59.7 %
George Patterson Boulevard
  October 28, 2005   Stabilized     71,500       0.7 %     71,500       100.0 %
King of Prussia
  August 11, 2004   Lease Up     427,109       4.2 %     374,387       87.7 %
Phoenixville Pike
  May 5, 2005   Stabilized     104,400       1.0 %     104,400       100.0 %
Spring Mill Drive
  July 20, 2006   Stabilized     76,561       0.8 %     76,561       100.0 %
900 Uniqema Boulevard (3)
  January 13, 2006   Stabilized     11,293       0.1 %     11,293       100.0 %
1000 Uniqema Boulevard (3)
  September 30, 2005   Stabilized     59,821       0.6 %     59,821       100.0 %
                           
 
                                               
Total Pennsylvania
                    778,434       7.7 %     714,527       91.8 %
                           
 
                                               
Seattle
                                               
 
                                               
Elliott Avenue
  August 24, 2004   Lease Up     154,341       1.5 %            
500 Fairview Avenue
  January 28, 2008   Stabilized     22,213       0.2 %     22,213       100.0 %

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                            Percent of           Percent
    Acquisition           Rentable   Rentable Sq   Leased   Leased
Property   Date   Property Status   Square Feet (1)   Feet   Square Feet   (6/30/10)
 
530 Fairview Avenue
  January 12, 2006   Lease Up     96,188       1.0 %     63,120       65.6 %
Monte Villa Parkway
  August 17, 2004   Stabilized     51,000       0.5 %     51,000       100.0 %
217th Place
  November 21, 2006   Lease Up     67,799       0.7 %     42,628       62.9 %
                           
 
                                               
Total Seattle
                    391,541       3.9 %     178,961       45.7 %
                           
 
                                               
University Related — Other
                                               
Lucent Drive (4)
  May 31, 2005   Stabilized     21,500       0.2 %     21,500       100 %
Trade Centre Avenue (5)
  August 9, 2006   Stabilized     78,023       0.8 %     78,023       100 %
Walnut Street (6)
  July 7, 2006   Stabilized     149,984       1.5 %     149,984       100 %
                           
 
                                               
Total University Related — Other
                    249,507       2.5 %     249,507       100 %
                           
 
                                               
Total / Weighted Average
                    10,087,789       100.0 %     7,947,679       78.8 %
                           
 
(1)   Estimates for purposes of development
 
(2)   We own an 87.5% membership interest in the limited liability company that owns this property.
 
(3)   Located in New Castle, Delaware.
 
(4)   Located in Lebanon, New Hampshire.
 
(5)   Located in Longmont, Colorado.
 
(6)   Located in Boulder, Colorado.

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          The unconsolidated partnerships in which we had an ownership interest, at June 30, 2010, were as follows:
                                                                 
                            Rentable     Leased              
            Property             Square     Square     Percent Leased        
Property   Acquisition Date     Status     Buildings     Feet(1)     Feet     6/30/10     12/31/09     Market  
McKellar Court(2)
                                                               
McKellar Court
  September 30, 2004   Stabilized     1       72,863       72,863       100.0 %     100.0 %   San Diego
 
                                                               
PREI(3)
                                                               
320 Bent Street
  April 4, 2007   Stabilized     1       184,405       184,405       100.0 %     100.0 %   Boston
301 Binney Street
  April 4, 2007   Lease Up     1       417,290       243,771       58.4 %     46.4 %   Boston
301 Binney Garage
  April 4, 2007   Lease Up     1     503  Stalls     n/a       n/a       n/a     Boston
650 E. Kendall Street (Kendall B)
  April 4, 2007   Development     1       280,000                       Boston
350 E. Kendall Street Garage (Kendall F)
  April 4, 2007   Stabilized     1     1,409  Stalls     n/a       n/a       n/a     Boston
Kendall Crossing Apartments
  April 4, 2007   Stabilized     1     37  Apts.     n/a       n/a       n/a     Boston
 
(1)   Estimates for purposes of development.
 
(2)   We own a general partnership interest in the limited partnership that owns this property, which entitles us to 75% of the gains upon a sale of the property and 22% of the operating cash flows.
 
(3)   We own 20% of the limited liability companies that own these properties.
          The development / redevelopment / pre-development properties that we owned or had an ownership interest in, at June 30, 2010, were as follows:
(Dollars in thousands)