SEC Info - Crescent Real Estate Equities Co

SEC Info℠

Home

Help

Please Sign In

Crescent Real Estate Equities Co – ‘10-Q’ for 3/31/98

As of: Friday, 5/15/98 · For: 3/31/98 · Accession #: 950134-98-4553 · File #: 1-13038

  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 5/15/98  Crescent Real Estate Equities Co  10-Q        3/31/98    2:94K                                    RR Donnelley

Quarterly Report — Form 10-Q
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        Form 10-Q for Quarter Ended March 31, 1998            36    197K 
 2: EX-27.01    Financial Data Schedule                                1      7K

10-Q — Form 10-Q for Quarter Ended March 31, 1998
Document Table of Contents

Page	(sequential)	\|	(alphabetic)	Top
			Alternative Formats (Word, et al.) Changes in Securities Credit Facility Defaults Upon Senior Securities Exhibits and Reports on Form 8-K Financial Statements Hotel Properties Legal Proceedings Management's Discussion and Analysis of Financial Condition and Historical Results of Operations Notes Offering Office Properties Operating Partnership Other Information Refrigerated Warehouse Investment Residential Development Properties Submission of Matters to a Vote of Security Holders
1	1st Page - Filing Submission
2	Item 1. Financial Statements
6	Operating Partnership
10	Credit Facility
"	Notes Offering
11	Refrigerated Warehouse Investment
13	Item 2. Management's Discussion and Analysis of Financial Condition and Historical Results of Operations
19	Office Properties
21	Hotel Properties
22	Residential Development Properties
24	Item 1. Legal Proceedings
"	Item 2. Changes in Securities
"	Item 3. Defaults Upon Senior Securities
"	Item 4. Submission of Matters to a Vote of Security Holders
"	Item 5. Other Information
"	Item 6. Exhibits and Reports on Form 8-K

10-Q 1st Page of 36 TOC ↑Top Previous Next ↓Bottom Just 1st
 
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 FORM 10-Q

 QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
 SECURITIES EXCHANGE ACT OF 1934

FOR QUARTER ENDED MARCH 31, 1998
COMMISSION FILE NO 1-13038

 CRESCENT REAL ESTATE EQUITIES COMPANY
 -------------------------------------------------------------
(Exact name of registrant as specified in its charter)

                                                        [Enlarge/Download Table]
                                                                                      
                  TEXAS                                      52-1862813               
---------------------------------------------  ---------------------------------------
(State or other jurisdiction of incorporation  (I.R.S. Employer Identification Number)
or organization)                                                                      

777 Main Street, Suite 2100, Fort Worth, Texas 76102
--------------------------------------------------------------------------------
(Address of principal executive offices)(Zip code)

 Registrant's telephone number, including area code (817) 877-0477

Number of shares outstanding of each of the registrant's classes of preferred   
and common shares, as of May 8, 1998.                                           

 Preferred Shares, par value $.01 per share: 8,000,000
Common Shares, par value $.01 per share: 120,097,948
--------------------------------------------------------------------------------

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

YES     X           NO        
      ---                ---

10-Q 2nd Page of 36 TOC 1st Previous Next ↓Bottom Just 2nd

 CRESCENT REAL ESTATE EQUITIES COMPANY
 FORM 10-Q
 TABLE OF CONTENTS

                                                        [Enlarge/Download Table]


PART I:  FINANCIAL INFORMATION                                                                   PAGE
                                                                                                 ----
                                                                                                     
Item 1.  Financial Statements                                                                        

         Consolidated Balance Sheets as of March 31, 1998 (Unaudited) and December 31, 1997.....   3 

         Consolidated Statements of Operations for the three months ended March 31,                  
         1998 and 1997 (Unaudited)..............................................................   4 

         Consolidated Statements of Cash Flows for the three months ended March 31,                  
         1998 and 1997 (Unaudited)..............................................................   5 

         Notes to Financial                                                                          
         Statements.............................................................................   6 

Item 2.  Management's Discussion and Analysis of Financial                                           
         Condition and Historical Results of Operations.........................................  13 

Item 3.  Quantitative and Qualitative Disclosures about Market Risk.............................  18 

PART II: OTHER INFORMATION                                                                           

Item 1.  Legal Proceedings......................................................................  24 

Item 2.  Changes in Securities..................................................................  24 

Item 3.  Defaults Upon Senior Securities........................................................  24 

Item 4.  Submission of Matters to a Vote of Security Holders....................................  24 

Item 5.  Other Information......................................................................  24 

Item 6.  Exhibits and Reports on Form 8-K.......................................................  24 


2 

10-Q 3rd Page of 36 TOC 1st Previous Next ↓Bottom Just 3rd

CRESCENT REAL ESTATE EQUITIES COMPANY 
CONSOLIDATED BALANCE SHEETS 
(DOLLARS IN THOUSANDS)
(NOTE 1)

                                                        [Enlarge/Download Table]


                                                                  March 31,    December 31,
                                                                    1998          1997     
                                                                 -----------   ----------- 
                                                                 (unaudited)               
                                                                                           
ASSETS:                                                                                    
 Investments in Real Estate:                                                               
   Land                                                          $   485,695   $   448,328 
   Building and improvements                                       3,338,133     2,923,097 
   Furniture, fixtures and equipment                                  53,185        51,705 
   Less -  accumulated depreciation                                 (302,826)     (278,194)
                                                                 -----------   ----------- 
             Net investment in real estate                         3,574,187     3,144,936 

   Cash and cash equivalents                                          68,548        66,622 
   Restricted cash and cash equivalents                               26,519        41,528 
   Accounts receivable, net                                           24,047        30,179 
   Deferred rent receivable                                           48,397        39,588 
   Investments in real estate mortgages and equity of                                      
       unconsolidated companies                                      583,262       601,770 
   Notes receivable, net                                             148,482       156,676 
   Other assets, net                                                 118,286        98,681 
                                                                 -----------   ----------- 
             Total assets                                        $ 4,591,728   $ 4,179,980 
                                                                 ===========   =========== 

LIABILITIES:                                                                               
   Borrowings under credit facility                              $   457,000   $   350,000 
   Notes payable                                                   1,517,927     1,360,124 
   Accounts payable, accrued expenses and other liabilities           79,222       127,258 
                                                                 -----------   ----------- 
             Total liabilities                                     2,054,149     1,837,382 
                                                                 -----------   ----------- 

MINORITY INTERESTS:                                                                        
  Operating partnership, 6,416,642 and 6,397,072 units,                                    
      respectively                                                   121,806       117,103 
  Investment joint ventures                                           27,815        28,178 
                                                                 -----------   ----------- 
             Total minority interests                                149,621       145,281 
                                                                 -----------   ----------- 

SHAREHOLDERS' EQUITY:                                                                      
      6 3/4% Series A Convertible Cumulative Preferred Shares,                             
      $.01 par value, authorized 100,000,000 shares,                                       
      8,000,000 shares issued and outstanding at March 31, 1998      200,000             - 
  Common shares, $.01 par value, authorized 250,000,000 shares,                            
     118,725,105 and 117,977,907 shares issued and outstanding                             
      at March 31, 1998 and December 31, 1997, respectively            1,186         1,179 
   Additional paid-in capital                                      2,248,628     2,253,928 
   Deferred compensation on restricted shares                           (281)         (283)
   Retained deficit                                                  (61,575)      (57,507)
                                                                 -----------   ----------- 
             Total shareholders' equity                            2,387,958     2,197,317 
                                                                 -----------   ----------- 
             Total liabilities and shareholder's equity          $ 4,591,728   $ 4,179,980 
                                                                 ===========   =========== 

The accompanying notes are in integral
part of these financial statements

3 

10-Q 4th Page of 36 TOC 1st Previous Next ↓Bottom Just 4th

CRESCENT REAL ESTATE EQUITIES COMPANY 
CONSOLIDATED STATEMENT OF OPERATIONS
(DOLLARS IN THOUSANDS 
EXCEPT PER SHARE DATA)
(NOTE 1)

                                                                [Download Table]

                                                     For the three months       
                                                       ended March 31,          
                                                         (unaudited)            
                                                    1998              1997      
                                               -------------      ------------- 
                                                                                
REVENUES:                                                                       
   Office and retail properties                $     126,428      $      70,415 
   Hotel properties                                   12,874              8,985 
   Behavioral healthcare properties                   13,823                --  
   Interest and other income                           8,024              1,530 
                                               -------------      ------------- 
          Total revenues                             161,149             80,930 
                                               -------------      ------------- 

EXPENSES:                                                                       
   Real estate taxes                                  16,097              7,925 
   Repairs and maintenance                             8,700              5,151 
   Other rental property operating                    29,891             17,520 
   Corporate general and administrative                3,147              4,845 
   Interest expense                                   34,283             14,744 
   Amortization of deferred financing costs            1,140                649 
   Depreciation and amortization                      26,582             13,952 
                                               -------------      ------------- 
          Total expenses                             119,840             64,786 
                                               -------------      ------------- 

         Operating income                             41,309             16,144 

OTHER INCOME:                                                                   
   Equity in net income of unconsolidated                                       
     companies                                         5,845              4,101 
                                               -------------      ------------- 

INCOME BEFORE MINORITY INTERESTS                      47,154             20,245 
Minority interests                                    (4,746)            (3,494)
                                               -------------      ------------- 

NET INCOME                                            42,408             16,751 

PREFERRED SHARE DIVIDENDS                             (1,575)               --  
                                               -------------      ------------- 

NET INCOME APPLICABLE TO COMMON SHAREHOLDERS   $      40,833      $      16,751 
                                               =============      ============= 

PER COMMON SHARE DATA:                                                          
   Net Income - Basic                          $        0.35      $        0.23 
                                               =============      ============= 
   Net Income - Diluted                        $        0.33      $        0.22 
                                               =============      ============= 

WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC      118,379,709         72,305,184 
                                               =============      ============= 
WEIGHTED AVERAGE SHARES OUTSTANDING - DILUTED    123,068,052         75,858,825 
                                               =============      ============= 


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

4 

10-Q 5th Page of 36 TOC 1st Previous Next ↓Bottom Just 5th

CRESCENT REAL ESTATE EQUITIES COMPANY 
CONSOLIDATED STATEMENTS OF CASH FLOWS 
(DOLLARS IN THOUSANDS)
(NOTES 1 AND 3) 

                                                        [Enlarge/Download Table]

                                                                    For the three months   
                                                                      ended March 31,      
                                                                  ------------------------ 
                                                                        (unaudited)        
                                                                    1998          1997     
                                                                  ---------      --------- 
                                                                                           
CASH FLOWS FROM OPERATING ACTIVITIES:                                                      
Net income applicable to common shareholders                      $  40,833      $  16,751 
Adjustments to reconcile net income to                                                     
  net cash provided by operating activities:                                               
   Depreciation and amortization                                     27,722         14,601 
   Minority interests                                                 4,746          3,494 
   Non-cash compensation                                                 24             20 
   Equity in earnings in excess of distributions                                           
     received from unconsolidated companies                          (3,635)          (182)
   Decrease (increase) in accounts receivable                         6,132         (4,513)
   Increase in deferred rent receivable                              (8,809)        (3,276)
   Increase in other assets                                         (18,623)        (3,458)
   Decrease in restricted cash and cash equivalents                  11,140         12,112 
   Decrease in accounts payable, accrued                                                   
     expenses and other liabilities                                 (48,036)        (5,106)
                                                                  ---------      --------- 
      Net cash provided by operating activities                      11,494         30,443 
                                                                  ---------      --------- 

CASH FLOWS FROM INVESTING ACTIVITIES:                                                      
   Acquisition of investment properties                            (421,354)      (222,158)
   Development of investment properties                              (5,416)        (3,801)
   Capital expenditures - rental properties                          (8,481)        (2,638)
   Tenant improvement and leasing costs - rental properties         (14,241)        (6,925)
   Decrease (increase) in restricted cash and cash equivalents -                           
      capital reserves                                                3,869           (281)
   Investment in unconsolidated companies                            22,143           (930)
   Decrease in escrow deposits - acquisition of investment              (80)        (4,890)
      properties                                                                           
   Decrease (increase) in notes receivable                            8,194        (11,642)
                                                                  ---------      --------- 
      Net cash used in investing activities                        (415,366)      (253,265)
                                                                  ---------      --------- 

CASH FLOWS FROM FINANCING ACTIVITIES:                                                      
   Debt financing costs                                                 127           (564)
   Borrowings under credit facility                                 335,050        116,000 
   Payments under credit facility                                  (228,050)           --  
   Debt proceeds                                                    158,100        151,039 
   Debt payments                                                       (297)           (80)
   Capital distributions - joint venture partner                       (763)          (728)
   Proceeds from exercise of common share options                        78            355 
   Net proceeds from preferred share offering                       191,250            --  
   Distributions to shareholders and unitholders                    (49,697)       (26,100)
                                                                  ---------      --------- 
      Net cash provided by financing activities                     405,798        239,922 
                                                                  ---------      --------- 

INCREASE IN CASH AND CASH EQUIVALENTS                                 1,926         17,100 
CASH AND CASH EQUIVALENTS,                                                                 
   Beginning of period                                               66,622         25,592 
                                                                  ---------      --------- 
CASH AND CASH EQUIVALENTS,                                                                 
   End of period                                                  $  68,548      $  42,692 
                                                                  =========      ========= 


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

5 

10-Q 6th Page of 36 TOC 1st Previous Next ↓Bottom Just 6th

 CRESCENT REAL ESTATE EQUITIES COMPANY
 NOTES TO FINANCIAL STATEMENTS
 (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

1.   ORGANIZATION AND BASIS OF PRESENTATION:                                    

ORGANIZATION                                                                    

        Crescent Real Estate Equities Company ("Crescent Equities") is a fully
integrated real estate company operating as a Texas real estate investment trust
for federal income tax purposes (a "REIT"). The Company provides management,    
leasing, and development services with respect to certain of its properties. The
direct and indirect subsidiaries of Crescent Equities include Crescent Real     
Estate Equities Limited Partnership (the "Operating Partnership"); Crescent Real
Estate Equities, Ltd. (the "General Partner"), which is the sole general partner
of the Operating Partnership; seven single purpose limited partnerships (formed 
for the purpose of obtaining securitized debt) in which the Operating           
Partnership owns substantially all of the economic interests directly or        
indirectly, with the remaining interests owned indirectly by Crescent Equities  
through seven separate corporations, each of which is a wholly owned subsidiary 
of the General Partner and a general partner of one of the seven limited        
partnerships. The term "Company" includes, unless the context otherwise         
requires, Crescent Equities, the Operating Partnership, the General Partner and 
the other direct and indirect subsidiaries of Crescent Equities.                

As of March 31, 1998, the Company directly or indirectly owned a portfolio of   
real estate assets (the "Properties") located primarily in 21 metropolitan      
submarkets in Texas and Colorado. The Properties include 86 office properties   
(the "Office Properties") with an aggregate of approximately 30.8 million net   
rentable square feet, 89 behavioral healthcare facilities (the "Behavioral      
Healthcare Facilities"), seven full-service hotels with a total of 2,276 rooms  
and two destination health and fitness resorts that can accommodate up to 452   
guests daily (the "Hotel Properties"), real estate mortgages and non-voting     
common stock representing interests ranging from 40% to 95% in five             
unconsolidated residential development corporations (the "Residential           
Development Corporations"), which in turn, through joint venture or partnership 
arrangements, own interests in 12 residential development properties (the       
"Residential Development Properties"), and seven retail properties (the "Retail 
Properties") with an aggregate of approximately .8 million net rentable square  
feet. In addition, the Company owns an indirect 38% interest in each of two     
corporations that currently own and operate approximately 80 refrigerated       
warehouses with an aggregate of approximately 394 million cubic feet (the       
"Refrigerated Warehouse Investment"). The Company also has a 42.5% partnership  
interest in a partnership whose primary holdings consist of a 364-room executive
conference center and general partner interests ranging from one to 50%, in     
additional office, retail, multi-family and industrial properties. In addition, 
the Company has entered into a merger agreement, pursuant to which the Company  
will acquire Station Casinos, Inc. ("Station") (see Note 9 - Pending            
Transactions), a corporation that owns and operates, through wholly owned       
subsidiaries, four full-service casino/hotels and two riverboat casinos         
(collectively, the "Casino/Hotel Properties").                                  

     Crescent Equities owns its assets and carries on its operations and
other activities through the Operating Partnership and its other subsidiaries.  

        The following table sets forth, by subsidiary, the Properties owned by
such subsidiary as of March 31, 1998:                                           

Operating Partnership:     59 Office Properties, six Hotel Properties and five  
Retail Properties         

Crescent Real Estate       The Aberdeen, The Avallon, Caltex House, The Citadel,
Funding I, L.P.:           Continental Plaza, The Crescent Atrium, The Crescent 
("Funding I")              Office Towers, Regency Plaza One, and Waterside      
Commons                   

6 

10-Q 7th Page of 36 TOC 1st Previous Next ↓Bottom Just 7th

                                                        [Enlarge/Download Table]
                                                                                      

Crescent Real Estate           Albuquerque Plaza, Barton Oaks Plaza One, Briargate    
Funding II, L.P.:              Office and Research Center, Hyatt Regency Albuquerque, 
("Funding II")                 Hyatt Regency Beaver Creek, Las Colinas Plaza, Liberty 
                               Plaza I & II, MacArthur Center I & II, Ptarmigan Place,
                               Stanford Corporate Centre, Two Renaissance Square, and 
                               12404 Park Central                                     

Crescent Real Estate           Greenway Plaza Portfolio(1)                            
Funding III, IV, and V, L.P.:                                                         
("Funding III, IV and V")                                                             

Crescent Real Estate           Canyon Ranch-Lenox                                     
Funding VI, L.P.:                                                                     
("Funding VI")                                                                        

Crescent Real Estate           Behavioral Healthcare Facilities                       
Funding VII, L.P.:                                                                    
("Funding VII")                                                                       

------------------------                                                        
(1)  Funding III owns the Greenway Plaza Portfolio, except for the central      
    heated and chilled water plant building and Coastal Tower Office property,
both located within Greenway Plaza, which are owned by Funding IV and 
Funding V, respectively.                                              

BASIS OF PRESENTATION                                                           

       The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial  
information and with the instructions to Form 10-Q and Article 10 of Regulation 
S-X. Accordingly, they do not include all of the information and footnotes      
required by generally accepted accounting principles for complete financial     
statements. In management's opinion, all adjustments (consisting of normal      
recurring adjustments) considered necessary for a fair presentation of the      
unaudited interim financial statements have been included. Operating results for
interim periods reflected are not necessarily indicative of the results that may
be expected for a full fiscal year. These financial statements should be read in
conjunction with the financial statements and notes thereto included in the     
Company's Form 10-K.                                                            

         Certain reclassifications have been made to previously reported amounts
to conform with current presentation.                                           

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:                                

         In March 1998, the Emerging Issues Task Force ("EITF") of the Financial
Accounting Standards Board ("FASB") issued EITF 97-11, "Accounting for Internal 
Costs Relating to Real Estate Property Acquisitions", which provides that       
internal costs of identifying and acquiring operating property should be        
expensed as incurred. This pronouncement is effective March 19, 1998 and has no 
material impact on the Company's financial statements.                          

3. SUPPLEMENTAL DISCLOSURES TO STATEMENTS OF CASH FLOWS:                        

                                                                [Download Table]

                                                              Three months ended 
                                                                   March 31,     
                                                              -------------------
                                                               1998        1997  
                                                               ----        ----  
                                                                                 
SUPPLEMENTAL DISCLOSURES OF CASH FLOW                                            
  INFORMATION:                                                                   

   Interest paid                                              $39,854     $13,108

SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING                                       
 AND FINANCING ACTIVITIES:                                                       

  Two-for-one common share dividend                           $    --     $   362
  Conversion of operating partnership units to common                            
    shares with resulting reduction in minority interest and                     
    increases in common shares and additional paid-in                            
    capital                                                   $ 3,352     $    --
  Issuance of operating partnership units in settlement                          
   of obligation                                              $ 8,522     $    --

7 

10-Q 8th Page of 36 TOC 1st Previous Next ↓Bottom Just 8th

4.   INVESTMENTS IN REAL ESTATE MORTGAGES AND EQUITY OF UNCONSOLIDATED          
COMPANIES:                                                            

 The Company reports its share of income and losses based on its
ownership interest in the respective equity investments. The following          
summarized information for all unconsolidated companies has been presented on an
aggregated basis and classified under the captions "Residential Development     
Corporations" and "Refrigerated Warehouse Investment and Other," as applicable, 
as of March 31, 1998.                                                           

                                                        [Enlarge/Download Table]

SUMMARY STATEMENTS OF OPERATIONS:                 FOR THE THREE MONTHS ENDED         
                                                        MARCH 31, 1998               
                                               ---------------------------------     
                                                 RESIDENTIAL         REFRIGERATED    
                                                 DEVELOPMENT     WAREHOUSE INVESTMENT
                                                CORPORATIONS          AND OTHER      
                                               ----------------  --------------------
                                                                                     
     Total revenues...........................       $  66,528          $  18,148    
     Total expenses...........................          61,450             15,684    
                                                    ----------         ----------    
     Net income...............................      $    5,078         $    2,464    
                                                    ==========         ==========    
     Company's equity in net income of                                               
        unconsolidated companies..............      $    4,338         $    1,507    
                                                    ==========         ==========    

5. NOTES PAYABLE AND BORROWINGS UNDER CREDIT FACILITY:                          

Following is a summary of the Company's debt financing:                         

                                                        [Enlarge/Download Table]

                                                                                      March 31, 1998
                                                                                      --------------
                                                                                                    
SECURED DEBT                                                                                        

LaSalle Note I bears interest at 7.83% with an initial seven-year interest-only                     
term (through August 2002), followed by principal amortization  based on a                          
25-year amortization schedule through maturity in August 2027(1), secured by                        
the Funding I properties.............................................................   $  239,000  

LaSalle Note II bears interest at 7.79% with an initial seven-year interest-only                    
term (through March 2003), followed by principal amortization based on a 25-year                    
amortization schedule through maturity in March 2028(2),                                            
secured by the Funding II properties.................................................      161,000  

LaSalle Note III due July 1999, bears interest at 30-day LIBOR plus a weighted                      
average  rate of 2.135% (at March 31, 1998 the rate was 7.82% subject to a rate                     
cap of 10%) with a five-year interest-only term, secured by the Funding III,                        
IV and V properties..................................................................      115,000  

Chase Manhattan Note due September 2001, bears interest at 30-day LIBOR plus 175                    
basis points (at March 31, 1998 the rate was 7.44%), and requires payments of                       
interest only during its term, secured by the Fountain Place Office Property ........       97,123  

CIGNA Note due December 2002, bears interest at 7.47% with a seven-year                             
interest-only term, secured by the MCI Tower Office Property and Denver                             
Marriott City Center Hotel Property..................................................       63,500  

8 

10-Q 9th Page of 36 TOC 1st Previous Next ↓Bottom Just 9th

                                                        [Enlarge/Download Table]
                                                                                       March 31, 1998
                                                                                       --------------
                                                                                                     

Metropolitan Life Note II due December 2002, bears interest at 6.93% with monthly                    
principal and interest payments based on a 25-year amortization schedule, secured                    
by the Energy Centre Office Property.................................................       44,831   

Northwestern Note due January 2003, bears interest at 7.66% with a seven-year                        
interest-only term, secured by the 301 Congress Avenue Office Property...............       26,000   

Metropolitan Life Note due September 2001, bears interest at 8.88% with monthly                      
principal and interest payments based on a 20-year amortization schedule, secured                    
by five of The Woodlands Office Properties...........................................       12,030   

Nomura Funding VI Note bears interest at 10.07% with monthly principal and                           
interest payments based on a 25-year amortization schedule through July 2020(3),                     
secured by the Funding VI property...................................................        8,666   

Rigney Note due November 2012, bears interest at 8.50% with quarterly principal                      
and interest payments based on a 15-year amortization schedule, secured by a                         
parcel of land.......................................................................          777   

UNSECURED DEBT                                                                                       

Line of Credit with BankBoston, N.A. ("BankBoston") ("Credit Facility") (see                         
description of Credit Facility below)................................................      457,000   

Short-term BankBoston Note due May 1998, bears interest at Eurodollar rate plus                      
120 basis points (at March 31, 1998, the rate was 6.89%).............................      250,000   

Short-term BankBoston Note II due August 1998, bears interest at Eurodollar rate                     
plus 120 basis points (at March 31, 1998, the rate was 6.89%)........................      100,000   

2007 Notes bear interest at a fixed rate of 7.13% with a ten-year interest-only                      
term, due September 2007 (see "Notes Offering" below for a description of                            
changes in the interest rate under specified circumstances)..........................      250,000   

2002 Notes bear interest at a fixed rate of 6.63% with a five-year interest-only                     
term, due September 2002 (see "Notes Offering" below for a                                           
description of changes in the interest rate under specified circumstances)...........      150,000   
                                                                                      ------------   

Total Notes Payable                                                                   $  1,974,927   
                                                                                      ============   


----------------------------                                                    

(1)      In August 2007, the interest rate increases, and the Company is        
     required to remit, in addition to the monthly debt service payment,
    excess property cash flow, as defined, to be applied first against
  principal until the note is paid in full and thereafter, against
       accrued excess interest, as defined. It is the Company's intention to
     repay the note in full at such time (August 2007) by making a final
payment of approximately $220,000.                            
(2)      In March 2006, the interest rate increases, and the Company is required
   to remit, in addition to the monthly debt service payment, excess
       property cash flow, as defined, to be applied first against principal
       until the note is paid in full and thereafter, against accrued excess
       interest, as defined. It is the Company's intention to repay the note
in full at such time (March 2006) by making a final payment of
approximately $154,000.                                       
(3)      In July 1998, the Company may defease the note by purchasing Treasury  
         obligations to pay the note without penalty. In July 2010, the interest
      rate due under the note will change to a 10-year Treasury yield plus
      500 basis points or, if the Company so elects, it may repay the note
without penalty.                                              

9 

10-Q 10th Page of 36 TOC 1st Previous Next ↓Bottom Just 10th

CREDIT FACILITY                                                                 

         On December 19, 1997, the Credit Facility was increased to $550,000, to
enhance the Company's financial flexibility in making new real estate           
investments. The interest rate on advances under the Credit Facility is the     
Eurodollar rate plus 120 basis points. The Credit Facility is unsecured and     
expires in June 2000. The Credit Facility requires the Company to maintain      
compliance with a number of customary financial and other covenants on an       
ongoing basis, including leverage ratios based on book value and debt service   
coverage ratios, limitations on additional secured and total indebtedness and   
distributions, and a minimum net worth requirement. As of March 31, 1998, the   
Company was in compliance with all covenants. As of March 31, 1998, the interest
rate was 6.89% and $93,000 was available under the Credit Facility.             

NOTES OFFERING                                                                  

      On September 22, 1997, the Operating Partnership completed a private
offering of unsecured notes in an aggregate principal amount of $400,000 (the   
"Notes"). The interest rates on the Notes are subject to temporary increase by  
50 basis points in the event that a registered offer to exchange the Notes for  
notes of the Operating Partnership with terms identical in all material respects
to the Notes were not consummated or a shelf registration statement with respect
to the resale of the Notes is not declared effective by the Securities and      
Exchange Commission (the "SEC") on or before March 21, 1998. The interest rates 
on the Notes were temporarily increased by 50 basis points, since the exchange  
offer was not completed by March 21, 1998. The Company anticipates that the     
interest rates on the Notes will return to the original rates in June 1998.     

6.   MINORITY INTERESTS:                                                        

    Minority interests represent (i) the limited partnership interests
owned by unitholders in the Operating Partnership ("units") and (ii) joint      
venture interests held by outside interests. Each unit may be exchanged for     
either two common shares or, at the election of the Company, cash equal to the  
fair market value of two common shares at the time of the exchange. When a      
unitholder exchanges a unit, the Company's investment in the Operating          
Partnership is increased. During the three months ended March 31, 1998, there   
were 105,585 units exchanged for 211,170 common shares.                         

7.   SHAREHOLDERS' EQUITY:                                                      

      On February 3, 1998, the Company paid a cash dividend and unitholder
distribution of $49,697 or $.38 per share and equivalent unit, to shareholders  
and equivalent unitholders of record on January 20, 1998. The dividend          
represented an annualized dividend of $1.52 per share and equivalent unit.      

        On February 19, 1998, the Company completed an offering (the "February
1998 Preferred Offering") of 8,000,000 shares of 6 3/4% Series A convertible    
cumulative preferred shares (the "Series A Preferred Shares") with a liquidation
preference of $25 per share. Series A Preferred Shares are convertible at any   
time, in whole or in part, at the option of the holders thereof into common     
shares of the Company at a conversion price of $40.86 per common share          
(equivalent to a conversion rate of .6119 common share per Series A Preferred   
Share), subject to adjustment in certain circumstances. Net proceeds to the     
Company from the February 1998 Preferred Offering after underwriting discounts  
of $8,000 and other offering costs of $750 were approximately $191,250. The net 
proceeds from the February 1998 Preferred Offering were used to repay borrowings
under the Credit Facility. Dividends on the Series A Preferred Shares are       
cumulative from the date of original issue and are payable quarterly in arrears 
commencing on May 15, 1998. The dividend represents an annualized dividend of   
$1.69 per share, or $.42 per share quarterly. On May 15, 1998, the Company paid 
the preferred dividend of $3,264.                                               

10

10-Q 11th Page of 36 TOC 1st Previous Next ↓Bottom Just 11th

8.   ACQUISITIONS:                                                              

      During the first quarter of 1998, the Company acquired in fee simple
the following Properties from unrelated third parties. The Company funded these 
acquisitions through borrowings under the Credit Facility and borrowings under  
the Company's $250,000 BankBoston Note.                                         

                                                        [Enlarge/Download Table]

                                                                                               Net     
                                                                                             Rentable  
                                                       Company's        Hotel                 Area     
    Property Name   Acq. Date   City, State    Ownership %  Acq. Price  Rooms  Apartments  (In Sq. Ft.)
    -------------   ---------   -----------    -----------  ----------  -----  ----------  ------------
                                                                                                       
Austin Centre/Omni                                                                                     
  Austin Hotel      1/23/98    Austin, TX          100      $   96,400   314       61          344,000 
Post Oak Central    2/13/98    Houston, TX         100         155,250   N/A       N/A       1,278,000 
Washington Harbour  2/25/98    Washington, D.C.    100         161,000   N/A       N/A         536,000 

9.   PENDING TRANSACTIONS:                                                      
Station Casinos, Inc.                                         

        On January 16, 1998, the Company entered into an agreement and plan of
merger pursuant to which Station will merge (the "Merger") with and into the    
Company. Station is an established multi-jurisdictional casino/hotel company    
that owns and operates, through wholly owned subsidiaries, six distinctly themed
casino/hotel properties, four full-service casinos/hotels which are located in  
Las Vegas, Nevada, and two riverboats, one of which is located in Kansas City,  
Missouri and one of which is located in St. Charles, Missouri. As a result of   
the Merger, the Company will acquire the real estate and other assets of        
Station, except to the extent operating assets are transferred immediately prior
to the Merger.                                                                  

        For the additional information regarding the Merger, see the Company's
Current Report on Form 8-K dated January 16, 1998 and filed January 27, 1998,   
and the amendments thereto filed February 13, 1998 and April 27, 1998.          

Refrigerated Warehouse Investment.                            

        On March 25, 1998, Americold Corporation, a wholly owned subsidiary of
the Americold partnership which the Company owns an indirect 38% interest in,   
entered into an agreement to acquire the assets of Freezer Services, Inc.,      
consisting of nine cold storage warehouses for approximately $134,000, including
$22,000 of indebtedness. There can be no assurance that this proposed           
transaction will ultimately be completed                                        

10.  PRO FORMA FINANCIAL INFORMATION                                            

      The pro forma financial information for the three months ended March
31, 1998 assumes the completion, in each case as of January 1, 1998, of (i) the 
February 1998 Preferred Share Offering; (ii) the 1998 completed acquisitions,   
inclusive of the pending transaction with Station (see Note 9); and (iii) the   
Unit Investment Trust Offering (as defined in Note 11). Pro Forma information   
assumes as of January 1, 1998, all offering proceeds were used for repayment of 
indebtedness incurred for acquisitions.                                         

11

10-Q 12th Page of 36 TOC 1st Previous Next ↓Bottom Just 12th

                                                                [Download Table]

                                              For the three months ended
                                                     March 31, 1998     
                                              --------------------------
                                                                        
Total revenues                                         $214,453         
Operating income                                         49,552         
Income before minority                                                  
   interests                                             55,397         

Net income available to common                                          
   shareholders                                          44,876         

Per common share data:                                                  
   Net income - Basic                                  $   0.38         
   Net income - Diluted                                $   0.36         

  The pro forma operating results combine the Company's historical
operating results with the historical incremental rental income and operating   
expenses including an adjustment for depreciation based on the acquisition price
associated with the Office Property acquisitions. Pro forma adjustments         
primarily represent the following: (i) rental income to the Company from the    
Hotel Property acquired during 1998 based on lease payments (base rent and      
percentage rent) from the hotel lessee by applying the rent provisions (as set  
forth in the lease agreement) to historical revenues of the hotel property; (ii)
rental income to the Company from the Casino/Hotel Properties to be acquired as 
a result of the Station Merger based on an estimated lease payment from the     
Casino/Hotel lessee by using the historical operating results of the            
Casino/Hotel Properties; (iii) an adjustment for depreciation expense for       
Office and Hotel Properties acquired in 1998 and for the Casino/Hotel           
Properties and (iv)  interest costs assuming the borrowings to finance          
acquisitions and assumption of debt for investments.                            

    These pro forma amounts are not necessarily indicative of what the
actual financial position or results of operations of the Company would have    
been assuming the above investments had been consummated or as of the beginning 
of the period, nor do they purport to represent the future financial position or
results of operations of the Company.                                           

11.  SUBSEQUENT EVENTS:                                                         

       On April 8, 1998, the Company declared a cash dividend and unitholder
distribution of $.38 per share and equivalent unit to shareholders and          
equivalent unitholders of record on April 20, 1998. The cash dividend and       
unitholder distributions were paid May 5, 1998, and represent an annualized     
dividend of $1.52 per share and equivalent unit.                                

   On April 23, 1998, the Company completed an offering of 1,365,138
common shares at $32.27 per share to Merrill Lynch & Co. (the "Underwriter").   
The Underwriter deposited the common shares with the trustee of the Equity      
Investor Fund Cohen & Steers Realty Majors Portfolio (A Unit Investment Trust)  
(the "Trust"), in exchange for units in the Trust (the "Unit Investment Trust   
Offering"). Net proceeds to the Company from the Unit Investment Trust Offering 
were $43,960. The net proceeds were used to reduce borrowings outstanding under 
the Credit Facility.                                                            

         On May 1, 1998, the Company acquired, subject to a ground lease, Datran
Center, two Class A office buildings, containing approximately 472,000 net      
rentable square feet located in the South Dade/Kendall submarket of Miami,      
Florida. The purchase price was approximately $71,000 of which $47,000 was      
funded through the assumption of two mortgage notes encumbering the leasehold   
interests in the land and the building and the remaining balance of $24,000     
through a borrowing under the Credit Facility.                                  

12

10-Q 13th Page of 36 TOC 1st Previous Next ↓Bottom Just 13th

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND         
HISTORICAL RESULTS OF OPERATIONS                                

      This information should be read in conjunction with the accompanying
consolidated financial statements and notes thereto. These financial statements 
include all adjustments which are, in the opinion of management, necessary to   
reflect a fair statement of the results for the interim periods presented, and  
all such adjustments are of a normal and recurring nature. The information      
herein should be read in conjunction with the more detailed information         
contained in the Company's Form 10-K for the year ended December 31, 1997.      
Capitalized terms used but not otherwise defined therein, shall have the        
meanings ascribed to those terms in the footnotes to the financial statements.  

       This Form 10-Q contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Although the Company believes that 
the expectations reflected in such forward-looking statements are based upon    
reasonable assumptions, the Company's actual results could differ materially    
from those set forth in the forward-looking statements. Certain factors that    
might cause such a difference are set forth in the Company's Current Report on  
Form 8-K dated April 17, 1998 and filed April 28, 1998 and include the          
following: changes in real estate conditions (including rental rates and        
competing properties) or in industries in which the Company's principal tenants 
compete; changes in general economic conditions; consummation of the proposed   
merger with Station on terms other than those described herein or the failure to
consummate the merger; the ability to identify acquisitions and investment      
opportunities meeting the Company's investment strategy; timely leasing of      
unoccupied square footage; timely releasing of occupied square footage upon     
expiration; the Company's ability to generate revenues sufficient to meet debt  
service payments and other operating expenses; the Company's inability to       
control the management and operation of its residential development properties, 
its tenants and the businesses associated with its investment in refrigerated   
warehouses; financing risks, such as the availability of funds sufficient to    
service existing debt, changes in interest rates associated with its variable   
rate debt, the availability of equity and debt financing terms acceptable to the
Company, the possibility that the Company's outstanding debt (which requires    
so-called "balloon" payments of principal) may be refinanced at higher interest 
rates or otherwise on terms less favorable to the Company and the fact that     
interest rates under the Credit Facility and certain of the Company's other     
financing arrangements may increase; the existence of complex regulations       
relating to the Company's status as a real estate investment trust and the      
adverse consequences of the failure to qualify as such;                         

13

10-Q 14th Page of 36 TOC 1st Previous Next ↓Bottom Just 14th
and other risks detailed from time to time in the Company's filings with the    
Securities and Exchange Commission. Given these uncertainties, readers are      
cautioned not to place undue reliance on such statements. The Company undertakes
no obligation to publicly release the results of any revisions to these         
forward-looking statements that may be made to reflect any future events or     
circumstances.                                                                  

RESULTS OF OPERATIONS - THREE MONTHS ENDED MARCH 31, 1998 AND 1997              

    Total revenues increased approximately $80.2 million, or 99.1%, to
$161.1 million for the three months ended March 31, 1998, as compared to $80.9  
million for the three months ended March 31, 1997. An increase in Office and    
Retail Property revenues of $56.0 million is primarily attributable to: (i) the 
acquisition of 27 Office Properties and one Retail Property subsequent to March 
31, 1997, which resulted in $42.9 million of incremental revenues; (ii) the fact
that five Office Properties acquired during the first quarter of 1997           
contributed revenues for a full quarter in 1998 as compared to a partial quarter
year in 1997, which resulted in $6.0 million of incremental revenues; and (iii) 
an increase in Office and Retail Property revenues of $7.1 million from the     
properties owned as of January 1, 1997, which is primarily due to rental rate   
and occupancy increases at these Properties. The increase in Hotel Property     
revenues of $3.9 million is primarily attributable to $.6 million from Hotel    
Properties owned as of January 1, 1997, which is attributable to an increase    
percentage rent received from the hotel lessee as a result of an increase in    
revenues at the hotels and $3.2 million from Hotel Properties acquired          
subsequent to January 1, 1997. The increase in Behavioral Healthcare Facilities 
revenues of $13.8 million is attributable to the acquisition of the facilities  
in June 1997. The increase in interest and other income of $6.5 million for the 
three months ended March 31, 1998, is primarily attributable to the sale of     
marketable securities and the $100.6 million increase in notes receivable as a  
result of the acquisition of certain notes included in the Carter-Crowley       
portfolio, and loans to Crescent Operating, Inc. ("COI").                       

       Total expenses increased $55.1 million, or 85%, to $119.8 million for
the three months ended March 31, 1998, as compared to $64.8 million for the     
three months ended March 31, 1997. An increase in rental property operating     
expenses of $24.1 million is primarily attributable to: (i) the acquisition of  
27 Office Properties and one Retail Property subsequent to March 31, 1997, which
resulted in $19.7 million of incremental expenses, and (ii) the fact that five  
Office Properties acquired during the first quarter of 1997 contributed expenses
for a full quarter in 1998 as compared to a partial quarter in 1997, which      
resulted in $2.4 million of incremental expenses; and (iii) an increase in      
expenses of $1.5 million from the Office and Retail Properties owned as of      
January 1, 1997. Depreciation and amortization increased $12.6 million primarily
due to the acquisitions of Office, Retail and Hotel Properties and the          
Behavioral Healthcare Facilities. An increase in interest expense of $19.5      
million is primarily attributable to: (i) $7.1 million of interest payable under
the Notes due 2002 and Notes due 2007, which were issued in a private offering  
in September 1997; (ii) $1.8 million of interest payable under the Chase        
Manhattan Note, which was assumed in the acquisition of Fountain Place in       
November 1997; (iii) $1.7 million of interest payable on the BankBoston Note II;
and (iv) $8.3 million of incremental interest payable due to draws under the    
Credit Facility (average balance outstanding for first quarter 1998 and 1997 was
$448 million and $156 million, respectively), all of which financing            
arrangements were used to fund investments.                                     

LIQUIDITY AND CAPITAL RESOURCES                                                 

         Cash and cash equivalents were $68.5 million and $66.6 million at March
31, 1998 and December 31, 1997, respectively. The increase is attributable to   
$405.8 million and $11.5 million of cash provided by financing and operating    
activities, respectively, offset by $415.4 million used in investing activities.
The Company's inflow of cash provided by financing activities is primarily      
attributable to net borrowings under the Credit Facility ($107.0 million) and   
borrowings under the BankBoston Note ($158.1 million) and net proceeds from the 
February 1998 Preferred Offering ($191.3 million). The inflow                   
from cash provided by financing activities was partially offset by the          
distributions paid to shareholders and unitholders ($49.7 million). The inflow  
from operating activities is primarily attributable to property operations, but 
is partially offset by the decrease in accounts payable due to the payment of   
real estate taxes. The Company utilized $415.4 million of cash flow primarily in
the                                                                             

14

10-Q 15th Page of 36 TOC 1st Previous Next ↓Bottom Just 15th

following investing activities: (i) the acquisition of six office properties    
and one hotel property ($421.4 million); (ii) recurring and non-recurring tenant
improvement and leasing costs for the office and retail properties ($14.2       
million); (iii) capital expenditures for rental properties ($8.5 million)       
primarily attributable to non-recoverable building improvements for the office  
and retail properties, and replacement of furniture, fixtures and equipment for 
the hotel properties; and (iv) development of investment properties ($5.4       
million). The outflow of cash used in investing activities was partially offset 
by: (i) net distributions received from the Company's unconsolidated companies  
($22.1 million) and (ii) decrease in notes receivable ($8.2 million).           

      On February 19, 1998, the Company completed an offering of 8,000,000
shares of 6 3/4% Series A convertible cumulative preferred shares with a        
liquidation preference of $25.00 per share. Series A Preferred Shares are       
convertible at any time, in whole or in part, at the option of the holders      
thereof into common shares of the Company at a conversion price of $40.86 per   
common share (equivalent to a conversion rate of .6119 common shares per Series 
A Preferred Share), subject to adjustment in certain circumstances. Net proceeds
to the Company from the February 1998 Preferred Offering after underwriting     
discounts of $8.0 million and other offering costs of $.8 million were          
approximately $191.3 million. The net proceeds from the February 1998 Preferred 
Offering were used to repay borrowings under the Credit Facility. Dividends on  
the Series A Preferred Shares are cumulative from the date of original issue and
are payable quarterly in arrears commencing on May 15, 1998. The dividend       
represents an annualized dividend of $1.69 per share, or $.42 per share         
quarterly.                                                                      

      As of March 25, 1998, with the exception of the Station transaction,
the Company had no commitments for material capital expenditures. The Company   
principally expects to fund the approximately $1.745 billion required to        
consummate the Merger with Station through the issuance of common shares and a  
new series of preferred shares with a value of approximately $700 million, the  
assumption of approximately $541 million of Station's outstanding debt, the     
refinancing of approximately $378 million of Station's outstanding debt and the 
incurrence of approximately $126 million in additional debt primarily related to
transaction costs. There are currently no definitive agreements or arrangements 
relating to refinancing or obtaining any such debt.                             

15

10-Q 16th Page of 36 TOC 1st Previous Next ↓Bottom Just 16th

The significant terms of the Company's primary debt financing 
arrangements are shown below (dollars in thousands):                            

                                                        [Enlarge/Download Table]

                                                                                                      BALANCE    
                                                                 INTEREST                           OUTSTANDING  
                                             MAXIMUM               RATE          EXPIRATION             AT       
              DESCRIPTION                  BORROWINGS           AT 3/31/98          DATE             3/31/98     
---------------------------------------- ---------------- ----- ----------- --------------------- -------------- 
                                                                                                                 
Secured Fixed Rate Debt:                                                                                         
LaSalle Note I                                $  239,000          7.83%         August 2027(1)       $  239,000  
LaSalle Note II                                  161,000          7.79%          March 2028(2)          161,000  
CIGNA Note                                        63,500          7.47%        December 2002             63,500  
Metropolitan Life Note II                         44,831          6.93%        December 2002             44,831  
Northwestern Life Note                            26,000          7.66%         January 2003             26,000  
Metropolitan Life Note I                          12,030          8.88%        September 2001            12,030  
Nomura Funding VI Note                             8,666         10.07%          July 2020(3)             8,666  
Rigney Promissory Note                               777          8.50%        November 2012                777  
                                         ----------------       -----------                       -------------- 
     Subtotal/Weighted Average                $  555,804          7.75%                              $  555,804  
                                         ================       ===========                       ============== 
Secured Capped Variable Rate Debt:                                                                               
     LaSalle Note III                        $   115,000          7.82%          July 1999           $  115,000  
                                         ================       ===========                       ===============
Secured Variable Rate Debt:                                                                                      
     Chase Manhattan Note                    $    97,123          7.44%        September 2001       $    97,123  
                                         ================       ===========                       ============== 
Unsecured Fixed Rate Debt:                                                                                       
Notes due 2007                                $  250,000          7.13%        September 2007        $  250,000  
Notes due 2002                                   150,000          6.63%        September 2002           150,000  
                                         ================       ===========                       ============== 
     Subtotal/Weighted Average                $  400,000          6.94%                              $  400,000  
                                         ================       ===========                       ============== 
Unsecured Variable Rate Debt:                                                                                    
Line of Credit                                $  550,000          6.89%          June 2000           $  457,000  
BankBoston Note                                  250,000          6.89%           May 1998              250,000  
BankBoston Note II                               100,000          6.89%         August 1998             100,000  
                                         ----------------       -----------                       -------------- 
     Subtotal/Weighted Average                $  900,000          6.89%                               $ 807,000  
                                         ================       ===========                       ============== 
TOTAL/WEIGHTED AVERAGE                        $2,067,927          7.22%                              $1,974,927  
                                         ================       ===========                       ============== 

-----------------                                                               

(1)      In August 2007, the interest rate increases, and the Company is        
     required to remit, in addition to the monthly debt service payment,
    excess property cash flow, as defined, to be applied first against
  principal until the note is paid in full and thereafter, against
       accrued excess interest, as defined. It is the Company's intention to
     repay the note in full at such time (August 2007) by making a final
payment of approximately $220 million.                        

(2)      In March 2006, the interest rate increases, and the Company is required
   to remit, in addition to the monthly debt service payment, excess
       property cash flow, as defined, to be applied first against principal
       until the note is paid in full and thereafter, against accrued excess
       interest, as defined. It is the Company's intention to repay the note
in full at such time (March 2006) by making a final payment of
approximately $154 million.                                   

(3)      In July 1998, the Company may defease the note by purchasing Treasury  
         obligations to pay the note without penalty. In July 2010, the interest
      rate due under the note will change to a 10-year Treasury yield plus
      500 basis points or, if the Company so elects, it may repay the note
without penalty.                                              

       Based on the Company's total market capitalization of $6.9 billion at
March 31, 1998 (at a $36 share price, which was the closing price of the common 
shares on the New York Stock Exchange on March 31, 1998, and including the full 
conversion of all units of minority interest in the Operating Partnership plus  
total indebtedness), the Company's debt represented 29% of its total market     
capitalization. The Company currently intends to maintain a conservative capital
structure with total debt targeted at 40% of total market capitalization.       

   The Company expects to meet its short-term liquidity requirements
primarily through cash flow provided by operating activities, which the Company 
believes will be adequate to fund normal recurring operating expenses, debt     
service requirements, recurring capital expenditures and distributions to       
shareholders and unitholders. To the extent the Company's cash flow from        
operating activities is not sufficient to finance non-recurring capital         
expenditures, such as tenant improvement and leasing costs related to previously
unoccupied space, or investment property acquisition and development costs, the 
Company expects to finance such activities with proceeds available under the    
Credit Facility, available cash reserves and other debt and equity financing.   

   The Company expects to meet its long-term liquidity requirements,
consisting primarily of maturities under the Company's fixed and variable rate  
debt through long-term secured and unsecured borrowings and the issuance of debt
securities and/or additional equity securities of the Company.                  

    The Company intends to maintain its qualification as a real estate
investment trust ("REIT") under the Internal Revenue Code of 1986, as amended   
(the "Code"). As a REIT, the Company will generally not be subject to           

16

10-Q 17th Page of 36 TOC 1st Previous Next ↓Bottom Just 17th

corporate federal income taxes as long as it satisfies certain technical        
requirements of the Code, including the requirement to distribute 95% of its    
taxable income to its shareholders.                                             

FUNDS FROM OPERATIONS                                                           

       Funds from Operations ("FFO"), based on the definition adopted by the
Board of Governors of the National Association of Real Estate Investment Trusts 
("NAREIT") and as used herein, means net income (loss) (determined in accordance
with generally accepted accounting principles or "GAAP"), excluding gains (or   
losses) from debt restructuring and sales of property, plus depreciation and    
amortization of real estate assets, and after adjustments for unconsolidated    
partnerships and joint ventures. FFO was developed by NAREIT as a relative      
measure of performance and liquidity of an equity REIT in order to recognize    
that income-producing real estate historically has not depreciated on the basis 
determined under GAAP. The Company considers FFO an appropriate measure of      
performance of an equity REIT. However, FFO (i) does not represent cash         
generated from operating activities determined in accordance with GAAP (which,  
unlike FFO, generally reflects all cash effects of transactions and other events
that enter into the determination of net income), (ii) is not necessarily       
indicative of cash flow available to fund cash needs and (iii) should not be    
considered as an alternative to net income determined in accordance with GAAP as
an indication of the Company's operating performance, or to cash flow from      
operating activities determined in accordance with GAAP as a measure of either  
liquidity or the Company's ability to make distributions. The Company has       
historically distributed an amount less than FFO, primarily due to reserves     
required for capital expenditures, including leasing costs. The aggregate       
distributions paid to shareholders and unitholders for the three months ended   
March 31, 1998 and 1997 were $49.7 and $26.1 million, respectively. An increase 
in FFO does not necessarily result in an increase in aggregate distributions    
because the Company's board of trustees is not required to increase             
distributions on a quarterly basis unless necessary in order to enable the      
Company to maintain REIT status. Because the Company must distribute 95% of its 
real estate investment trust taxable income (as defined in the Code), however, a
significant increase in FFO will generally require an increase in distributions 
to shareholders and unitholders although not necessarily on a proportionate     
basis. Accordingly, the Company believes that in order to facilitate a clear    
understanding of the consolidated historical operating results of the Company,  
FFO should be considered in conjunction with the Company's net income (loss) and
cash flows as reported in the consolidated financial statements and notes       
thereto. However, the Company's measure of FFO may not be comparable to         
similarly titled measures of other REIT's because these REIT's may not apply the
definition of FFO in the same manner as the Company.                            

17

10-Q 18th Page of 36 TOC 1st Previous Next ↓Bottom Just 18th

 STATEMENTS OF FUNDS FROM OPERATIONS
(dollars in thousands)

                                                        [Enlarge/Download Table]

                                                                      Three Months Ended    
                                                                           March 31,        
                                                                       1998         1997    
                                                                     --------      -------- 
                                                                                            
Income Before Minority Interests                                     $ 47,154      $ 20,245 

Adjustments:                                                                                
  Depreciation and amortization of real estate assets                  26,051        13,496 
  Adjustment for investments in real estate mortgages and equity of                         
    unconsolidated companies                                           12,314           266 
  Minority interest in joint ventures                                  (1,575)         (416)
  Preferred stock dividends                                              (400)           -- 
                                                                     --------      -------- 

Funds From Operations                                                $ 83,544      $ 33,591 
                                                                     ========      ======== 

RECONCILIATION OF FUNDS FROM OPERATIONS TO NET CASH PROVIDED
 BY OPERATING ACTIVITIES
(dollars in thousands)

                                                        [Enlarge/Download Table]

                                                                    Three Months Ended   
                                                                        March 31,        
                                                                    1998         1997    
                                                                  --------      -------- 
                                                                                         
Funds From Operations                                             $ 83,544      $ 33,591 

Adjustments:                                                                             
  Depreciation and amortization of non-real estate assets              345           293 
  Amortization of deferred financing costs                           1,140           649 
  Minority interest in joint ventures profit and depreciation                            
     and amortization of real estate assets                            586           579 
  Adjustment for investments in real estate mortgages and equity                         
     of unconsolidated companies                                   (12,314)         (266)
  Change in deferred rent receivable                                (8,809)       (3,276)
  Change in current assets and liabilities                         (49,387)         (965)
  Equity in earnings in excess of distributions received from                            
      unconsolidated companies                                      (3,635)         (182)
  Non-cash compensation                                                 24            20 
                                                                  --------      -------- 

Net Cash Provided by Operating Activities                         $ 11,494      $ 30,443 
                                                                  ========      ======== 

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK              

This item is inapplicable to the Company because its market   
capitalization was less than $2.5 billion on January 28, 1997.                  

18

10-Q 19th Page of 36 TOC 1st Previous Next ↓Bottom Just 19th
OFFICE PROPERTIES 

        The following table sets forth certain information about the
Office Properties as of March 31, 1998.                                         

                                                        [Enlarge/Download Table]

                                                                                                          WEIGHTED  
                                                                                                           AVERAGE  
                                                                                 NET                    FULL-SERVICE
                                                                              RENTABLE                   RENTAL RATE
                                  NO. OF                           YEAR         AREA         PERCENT      PER LEASED
      STATE, CITY, PROPERTY     PROPERTIES    SUBMARKET          COMPLETED    (SQ. FT.)       LEASED      SQ. FT.(1)
      ---------------------     ----------    ---------          ---------    ---------       ------      ----------
                                                                                                                    
TEXAS                                                                                                               
 DALLAS                                                                                                             
   Bank One Center(2)..........        1    CBD                       1987   1,530,957          73%     $      21.46
   The Crescent Office Towers..        1    Uptown/Turtle Creek       1985   1,210,949          96             28.26
   Fountain Place..............        1    CBD                       1986   1,200,266          95             18.13
   Trammell Crow Center(3).....        1    CBD                       1984   1,128,331          87(5)          25.04
   Stemmons Place..............        1    Stemmons Freeway          1983     634,381          92             14.09
   Spectrum Center(4)..........        1    Far North Dallas          1983     598,250          74             20.67
   Waterside Commons...........        1    Las Colinas               1986     458,739          99             16.60
   Caltex House................        1    Las Colinas               1982     445,993          93             25.68
   Reverchon Plaza.............        1    Uptown/Turtle Creek       1985     374,165          98             17.34
   The Aberdeen................        1    Far North Dallas          1986     320,629         100             18.19
   MacArthur Center I & II.....        1    Las Colinas          1982/1986     294,069          98             18.20
   Stanford Corporate Centre...        1    Far North Dallas          1985     265,507         100             16.36
   The Amberton................        1    Central Expressway        1982     255,052          77(5)          11.15
   Concourse Office Park.......        1    LBJ Freeway          1972-1986     244,879          87(5)          12.73
   12404 Park Central..........        1    LBJ Freeway               1987     239,103          85(5)          18.48
   Palisades Central II........        1    Richardson/Plano          1985     237,731          92             16.79
   3333 Lee Parkway............        1    Uptown/Turtle Creek       1983     233,769          83(5)          19.12
   Liberty Plaza I & II........        1    Far North Dallas     1981/1986     218,813         100             13.45
   The Addison.................        1    Far North Dallas          1981     215,016          99             15.72
   The Meridian................        1    LBJ Freeway               1984     213,915          92             15.34
   Palisades Central I.........        1    Richardson/Plano          1980     180,503          88             14.13
   Walnut Green................        1    Central Expressway        1986     158,669          92             13.90
   Greenway II.................        1    Richardson/Plano          1985     154,329          98             19.45
   Addison Tower...............        1    Far North Dallas          1987     145,886          95(5)          13.37
   5050 Quorum.................        1    Far North Dallas          1981     133,594          94             14.93
   Cedar Springs Plaza.........        1    Uptown/Turtle Creek       1982     110,923          94             16.81
   Greenway IA.................        1    Richardson/Plano          1983      94,784         100             21.95
   Valley Centre...............        1    Las Colinas               1985      74,861          97             15.22
   Greenway I..................        1    Richardson/Plano          1983      51,920         100             21.95
   One Preston Park............        1    Far North Dallas          1980      40,525          82             15.08
                                     ---                                    ----------     -------      ------------
     Subtotal/Weighted Average.       30                                    11,466,508          90%     $      19.70
                                     ---                                    ----------     -------      ------------

 FORT WORTH                                                                                                         
   Continental Plaza...........        1    CBD                       1982     954,895          50%(5)  $      15.71
                                    ----                                    ----------     -------      ------------

 HOUSTON                                                                                                            
  Greenway Plaza Office                                                                                             
    Portfolio..................       10    Richmond-Buffalo     1969-1982   4,286,277          86%     $      15.16
                                            Speedway                                                                
  Houston Center...............        3    CBD                  1974-1983   2,764,418          92             15.00
  Post Oak Central.............        3    West Loop/Galleria   1974-1981   1,277,598          94             15.86
  The Woodlands Office                                                                                              
    Properties(6)..............       12    The Woodlands        1980-1996     810,630          98             15.01
   Three Westlake Park(7)......        1    Katy Freeway              1983     414,251          99             13.45
   U.S. Home Building..........        1    West Loop/Galleria        1982     399,777          83             14.67
                                    ----                                    ----------     -------      ------------
     Subtotal/Weighted Average.       30                                     9,952,951          90%     $      15.10
                                     ---                                    ----------     -------      ------------

 AUSTIN                                                                                                             
   Frost Bank Plaza............        1    CBD                       1984     433,024          74%(5)  $      17.81
   301 Congress Avenue(8)......        1    CBD                       1986     418,338          96(5)          23.03
   Bank One Tower..............        1    CBD                       1974     389,503          95             16.63
   Austin Centre...............        1    CBD                       1986     343,665          98             19.21
   The Avallon.................        1    Northwest            1993/1997     232,301(9)       78(5)          18.95
   Barton Oaks Plaza One.......        1    Southwest                 1986      99,792          92             19.71
                                    ----                                    ----------     -------      ------------
       Subtotal/Weighted Average       6                                     1,916,623          89%     $      19.28
                                    ----                                    ----------     -------      ------------

COLORADO                                                                                                            
 DENVER                                                                                                             
   MCI Tower...................        1    CBD                       1982     550,807          93%     $      17.96
   Ptarmigan Place.............        1    Cherry Creek              1984     418,565          83(5)          15.97
   Regency Plaza One...........        1    DTC                       1985     309,862          86(5)          20.93

19

10-Q 20th Page of 36 TOC 1st Previous Next ↓Bottom Just 20th

                                                        [Enlarge/Download Table]

                                                                                                        WEIGHTED  
                                                                                                         AVERAGE  
                                                                                 NET                  FULL-SERVICE
                                                                              RENTABLE                 RENTAL RATE
                                  NO. OF                           YEAR         AREA       PERCENT      PER LEASED
      STATE, CITY, PROPERTY     PROPERTIES    SUBMARKET          COMPLETED    (SQ. FT.)     LEASED      SQ. FT.(1)
      ---------------------     ----------    ---------          ---------    ---------     ------      ----------
                                                                                                                  
   AT&T Building...............        1    CBD                       1982     184,581        95             14.89
   The Citadel.................        1    Cherry Creek              1987     130,652        97             19.79
   55 Madison..................        1    Cherry Creek              1982     137,176        80(5)          17.20
   44 Cook.....................        1    Cherry Creek              1984     124,174        90             17.98
                                     ---                                    ----------   -------      ------------
       Subtotal/Weighted Average       7                                     1,855,817        89%     $      17.79
                                     ---                                    ----------   -------      ------------

 COLORADO SPRINGS                                                                                                 
   Briargate Office and                                                                                           
   Research Center                     1    Colorado Springs          1988     252,857        99%     $      15.35
                                     ---                                    ----------   -------      ------------

LOUISIANA                                                                                                         
 NEW ORLEANS                                                                                                      
   Energy Centre...............        1    CBD                       1984     761,500        77%     $      14.58
   1615 Poydras................        1    CBD                       1984     508,741        79             15.08
                                     ---                                    ----------   -------      ------------
       Subtotal/Weighted Average       2                                     1,270,241        78%     $      14.79
                                     ---                                    ----------   -------      ------------

FLORIDA                                                                                                           
 MIAMI                                                                                                            
   Miami Center................        1    CBD                       1983     782,686        78%     $      23.42
   Datran Center(10)...........        2    South Dade/Kendall   1986/1988     472,236        91             20.29
                                     ---                                    ----------   -------      ------------
     Subtotal/Weighted Average         2                                     1,254,922        83%     $      22.13
                                     ---                                    ----------   -------      ------------

ARIZONA                                                                                                           
 PHOENIX                                                                                                          
   Two Renaissance Square......        1    Downtown/CBD              1990     476,373        88%(5)  $      22.62
   6225 North 24th Street......        1    Camelback Corridor        1981      86,451        67             21.80
                                     ---                                    ----------   -------      ------------
       Subtotal/Weighted Average       2                                       562,824        85%     $      22.52
                                     ---                                    ----------   -------      ------------

WASHINGTON, D.C.                                                                                                  
  WASHINGTON, D.C.                                                                                                
     Washington Harbour........        2    Georgetown                1986     536,206        95%     $      36.60
                                     ---                                    ----------   -------      ------------

NEBRASKA                                                                                                          
 OMAHA                                                                                                            
   Central Park Plaza..........        1    CBD                       1982     409,850        99%     $      15.27
                                     ---                                    ----------   -------      ------------

NEW MEXICO                                                                                                        
 ALBUQUERQUE                                                                                                      
   Albuquerque Plaza...........        1    CBD                       1990     366,236        92%(5)  $      18.41
                                     ---                                    ----------   -------      ------------

CALIFORNIA                                                                                                        
 SAN FRANCISCO                                                                                                    
   160 Spear Street............        1    South of Market/CBD       1984     276,420        97%     $      24.81
                                     ---                                    ----------   -------      ------------

 SAN DIEGO                                                                                                        
   Chancellor Park(11).........        1    UTC                       1988     195,733        86%     $      20.42
                                     ---                                    ----------   -------      ------------

       TOTAL WEIGHTED AVERAGE..       88                                    31,272,083        88%(5)  $      18.20
                                     ===                                    ==========   =======      ============

---------------------------------                                         

(1)  Calculated based on base rent payable as of March 31, 1998, without giving 
  effect to free rent or scheduled rent increases that would be taken into
account under generally accepted accounting principles and including  
adjustments for expenses payable by or reimbursable from tenants.     
(2)  The Company has a 50% general partner interest in the partnership that owns
Bank One Center.                                                      
(3)  The Company owns the principal economic interest in Trammell Crow Center   
 through its ownership of fee simple title to the Property (subject to a
ground lease and a leasehold estate regarding the building) and two   
mortgage notes encumbering the leasehold interests in the land and    
building.                                                             
(4)  The Company owns the principal economic interest in Spectrum Center through
an interest in Spectrum Mortgage Associates L.P., which owns both a   
   mortgage note secured by Spectrum Center and the ground lessor's interest
in the land underlying the office building.                           
(5)  Leases have been executed at certain Office Properties but had not         
  commenced as of March 31, 1998. If such leases had commenced as of March
     31, 1998, the percent leased for Office Properties would have been 92%. The
total percent leased for such Properties would have been as follows:  
 Trammell Crow Center - 90%; The Amberton - 80%; Concourse Office Park -
 90%; 12404 Park Central - 100%; 3333 Lee Parkway - 98%; Addison Tower -
     98%; Continental Plaza - 100%; Frost Bank Plaza - 77%; 301 Congress - 100%;
    The Avallon - 100%; Ptarmigan Place - 94%; Regency Plaza - 95%; 55 Madison
- 87%; Two Renaissance Square - 91%; and Albuquerque Plaza - 96%.     
(6)  The Company has a 75% limited partner interest and an indirect             
     approximately 10% general partner interest in the partnership that owns the
12 Office Properties that comprise The Woodlands Office Properties.   
(7)  The Company owns the principal economic interest in Three Westlake Park    
  through its ownership of a mortgage note secured by Three Westlake Park.
(8)  The Company has a 1% general partner and a 49% limited partner interest in 
the partnership that owns 301 Congress Avenue.                        

20

10-Q 21st Page of 36 TOC 1st Previous Next ↓Bottom Just 21st

(9)  In August 1997, construction was completed on a 106,342 square foot office 
 property. The entire building is leased to BMC Software, Inc., which is
expected to occupy in stages over the next 16 months.                 
(10) Acquired subsequent to March 31, 1998.                                     
(11) The Company owns Chancellor Park through its ownership of a mortgage note  
  secured by the building and through its direct and indirect interests in
the partnership which owns the building.                              

AGGREGATE LEASE EXPIRATIONS OF OFFICE PROPERTIES

The following table sets forth a schedule of the lease expirations for
leases in place as of March 31, 1998, at the Company's Office Properties for    
each of the 10 years beginning with the remainder of 1998, assuming that none of
the tenants exercises renewal options and excluding an aggregate of 3,817,269   
square feet of unleased space.                                                  

                                                        [Enlarge/Download Table]

                                                                                     PERCENTAGE              
                                        NET RENTABLE     PERCENTAGE                   OF TOTAL    ANNUAL     
                                            AREA         OF LEASED                     ANNUAL     BASE RENT  
                            NUMBER OF    REPRESENTED    NET RENTABLE   ANNUAL BASE    BASE RENT   PER NET    
                          TENANTS WITH   BY EXPIRING  AREA REPRESENTED  RENT UNDER   REPRESENTED  RENTABLE   
                            EXPIRING       LEASES       BY EXPIRING      EXPIRING    BY EXPIRING  AREA       
YEAR OF LEASE EXPIRATION     LEASES     (SQUARE FEET)      LEASES       LEASES(1)      LEASES     EXPIRING(1)
-------------------------------------------------------------------------------------------------------------
                                                                                                             
1998..............             491        1,954,133          7.1%       $32,154,430      6.2%       $16.45   
1999..............             436        3,570,346         13.0         61,336,142     11.9         17.18   
2000 .............             401        3,403,540         12.4         63,596,755     12.3         18.69   
2001..............             328        3,777,740         13.8         66,116,626     12.8         17.50   
2002..............             300        3,477,274         12.7         69,783,650     13.5         20.07   
2003..............             118        1,788,048          6.7         31,567,157      6.1         17.65   
2004 .............              88        2,708,897          9.9         51,534,032     10.0         19.02   
2005..............              53        2,047,630          7.5         42,474,396      8.2         20.74   
2006..............              21          530,108          1.9         10,234,120      2.0         19.31   
2007..............              26        1,144,145          4.2         21,892,193      4.2         19.13   
2008 and thereafter             44        3,052,953         11.1         65,063,918     12.6         21.31   

(1)  Calculated based on base rent payable as of the expiration date of the     
    lease for net rentable square feet expiring, without giving effect to free
 rent or scheduled rent increases that would be taken into account under
generally accepted accounting principles and including adjustments for
   expenses payable by or reimbursable from tenants based on current levels.

HOTEL PROPERTIES

    The following table sets forth certain information about the Hotel
Properties for the three months ended March 31, 1998 and 1997. The information  
for the Hotel Properties is based on available rooms, except for Canyon         
Ranch-Tucson and Canyon Ranch-Lenox, which are destination health and fitness   
resorts that measure performance based on available guest nights.               

21

10-Q 22nd Page of 36 TOC 1st Previous Next ↓Bottom Just 22nd

                                                        [Enlarge/Download Table]

                                                                           For the three months ended                
                                                                                   March 31,                         
                                                              -----------------------------------------------------  
                                                                                                        Revenue      
                                                                              Average      Average        Per        
                                                                             Occupancy       Daily       Available   
                                                                                Rate          Rate         Room      
                                                  Year                        -------       -------       -------    
                                               Completed/                                                            
Hotel Property(1)              Location         Renovated       Rooms     1998   1997   1998    1997   1998   1997   
--------------                 --------         ---------       ------    ----   ----   ----    ----   ----   ----   
                                                                                                                     
Full-Service/Luxury Hotels:                                                                                          
Denver Marriott City Center   Denver, CO        1982/1994        613                                                 
Four Seasons Hotel-Houston    Houston, TX         1982           399                                                 
Hyatt Regency Albuquerque     Albuquerque/NM      1990           395                                                 
Omni Austin Hotel             Austin, TX          1986           314                                                 
Hyatt Regency Beaver Creek    Avon, CO            1989           295                                                 
Sonoma Mission Inn & Spa      Sonoma, CA      1927/1987/1997     198(2)                                              
Ventana Country Inn           Big Sur, CA     1975/1982/1988      62                                                 
                                                               -----    -----  -----  -----    -----  -----    ------
      Total/Weighted Average                                   2,276     73%    77%   $170     $159    $123    $  123
                                                               =====    =====  =====  =====    =====  =====    ======

                                                                Guest Nights                                         
                                                                ------------                                         

Destination Health & Fitness                                                                                         
Resorts                                                                                                              
Canyon-Ranch - Tucson         Tucson, AZ          1980           250(3)                                              
Canyon Ranch - Lenox          Lenox, MA           1989           202(3)                                              
                                                                 ------                                              
      TOTAL/WEIGHTED AVERAGE                                     452     90%(4) 82%(4)$519(5) $488(5) $455(6) $391(6)
                                                               =====     ===    ===    ===     ====    ====    ====  

---------------------------                                                     

(1)  Because of the Company's status as a REIT for federal income tax purposes, 
it does not operate the Hotel Properties and has leased the Hotel     
Properties to subsidiaries of COI pursuant to long-term leases.       
(2)  In July 1997, 30 additional rooms were completed.                          
(3)  Represents available guest nights, which is the maximum number of guests   
that the resort can accommodate per night.                            
(4)  Represents the number of paying and complimentary guests for the period,   
 divided by the maximum number of available guest nights for the period.
(5)  Represents the average daily "all-inclusive" guest package charges for     
  the period, divided by the average daily number of paying guests for the
period.                                                               
(6)  Represents the total "all-inclusive" guest package charges for the period, 
 divided by the maximum number of available guest nights for the period.

RESIDENTIAL DEVELOPMENT PROPERTIES

     The Company owns economic interests in five Residential Development
Corporations through the Residential Development Property Mortgages relating to 
and the non-voting common stock in these Residential Development Corporations.  
The Residential Development Corporations in turn, through joint ventures or     
partnership arrangements, own interests in the 12 Residential Development       
Properties. The Residential Development Corporations are responsible for the    
continued development and the day-to-day operations of the Residential          
Development Properties.                                                         

22

10-Q 23rd Page of 36 TOC 1st Previous Next ↓Bottom Just 23rd

RESIDENTIAL DEVELOPMENT PROPERTIES TABLE                                        

         The following table sets forth certain information as of March 31,1998,
relating to the Residential Development Properties.                             

                                                        [Enlarge/Download Table]


                                                                                                      Average                      
                                                                                  Total      Total    Closed                       
                 Residential                             Residential   Total    Lots/Units Lots/Units  Sale            Range of    
Residential      Development                             Development   Lots/    Developed   Closed     Price           Proposed    
Development      Properties    Type of                   Corporation's Units      Since     Since     Per Lot/       Sale Prices   
Corporation(1)      (RDP)       RDP(2)      Location     Ownership %   Planned  Inception  Inception  Unit ($)      Per Lot ($)(3) 
--------------      -----       ------      --------     -----------   -------  ---------  ---------  --------      -------------- 
                                                                                                                                   
Mira Vista       Mira Vista       SF     Fort Worth, TX    100.00%       706       581        537       94,300       50,000-265,000
 Development     The Highlands    SF     Breckenridge, CO   12.25%       750       219        206      140,000       55,000-250,000
 Corp.                                                                ------    ------     ------                                  
     Total Mira Vista Development Corp.                                1,456       800        743                                  
                                                                      ------    ------     ------                                  

Houston Area     Falcon Point     SF     Houston, TX        100.0%     1,205       508        227       28,000        16,000-60,000
 Development     Spring Lakes     SF     Houston, TX        100.0%       536(4)      -          -          N/A        21,000-45,000
 Corp.                                                                                                                             
                                                                      ------    ------     ------                                  

     Total Houston Area Development Corp                               1,741       508        227                                  
                                                                      ------    ------     ------                                  
Crescent         One Beaver Creek CO     Avon, CO            60.0%        18        18         18   $2,181,000 $1,330,000-3,420,000
Development      Market Square    CO     Avon, CO            60.0%        26        26         26      896,000    356,000-2,161,000
Management       The Reserve at                                                                                                    
 Corp.              Frisco        SF     Frisco, CO          60.0%       134       134         81       95,000       75,000-169,000
                 Villa Montane                                                                                                     
                   Townhomes      TH     Avon, CO            30.0%        27(5)      -          -          N/A    515,000-1,700,000
                 Villa Montane                                                                                                     
                     Club         TS     Avon, CO            30.0%       746(5)      -          -          N/A        27,000-77,000
                 Villas at Beaver                                                                                                  
                     Creek        TH     Avon, CO            30.0%        10(5)      -          -          N/A  1,500,000-2,950,000
                                                                      ------    ------     ------                                  

     Total Crescent Development Management Corp.                         961       178        125                                  
                                                                      ------    ------     ------                                  

The Woodlands    The Woodlands    SF     The Woodlands, TX   42.5%    38,313    18,765     17,685       40,000       13,000-250,000
Land Company                                                          ------    ------     ------                                  
Inc.                                                                                                                               

Desert Mountain  Desert Mountain  SF     Scottsdale, AZ      93.0%     2,544     1,872      1,622      305,000    150,000-2,500,000
Development                                                           ------    ------     ------                                  
Corp.                                                                                                                              

     Total                                                            45,015    22,123     20,402                                  
                                                                      ======    ======     ======                                  

-------------------------------                                                 

(1)  The Company has an approximately 94%, 94%, 90%, 95% and 95% ownership      
   interest in Mira Vista Development Corp., Houston Area Development Corp.,
  Crescent Development Management Corp., The Woodlands Land Company, Inc.,
   and Desert Mountain Development Corp., respectively, through ownership of
non-voting common stock in each of these Residential Development      
Corporations.                                                         
(2)  SF (Single-Family); CO (Condominium); TH (Townhome); and TS (Timeshare).   
(3)  Based on existing inventory of developed lots and lots to be developed.    
(4)  The initial phase of this project (93 lots) is expected to be completed in 
the second quarter of 1998.                                           
(5)  As of March 31, 1998, eight units were under contract at Villas at Beaver  
 Creek representing $17.9 million in sales proceeds, 14 units were under
 contract at Villa Montane Townhomes representing $13.0 million in sales
proceeds, and 605 contracts were pre-sold at Villa Montane Club       
representing $36.9 million in sales proceeds.                         

23

10-Q 24th Page of 36 TOC 1st Previous Next ↓Bottom Just 24th
 PART II

OTHER INFORMATION                                                               

Item 1.  Legal Proceedings                                                      
None                                                          

Item 2.  Changes in Securities                                                  
None                                                          

Item 3.  Defaults Upon Senior Securities                                        
None                                                          

Item 4.  Submission of Matters to a Vote of Security Holders                    
None                                                          

Item 5.  Other information                                                      
None                                                          

Item 6.  Exhibits and Reports on Form 8-K.                                      

(a)                                                           

                                                                [Download Table]

EXHIBIT                                                                         
NUMBER         DESCRIPTION OF EXHIBIT                                           
-------        ----------------------                                           
                                                                                
2.01           Agreement and Plan of Merger, dated as of January 16, 1998, as   
               amended, by and between Crescent Real Estate Equities Company    
               and Station Casinos, Inc. (filed as Exhibit No. 2.01 to the      
               Registrant's Annual Report on Form 10-K for the fiscal year ended
               December 31, 1997, as amended (the "1997 10-K") and incorporated 
               herein by reference)                                             

3.01           Restated Declaration of Trust of Crescent Real Estate Equities   
               Company (filed as Exhibit No. 4.01 to the Registrant's           
               Registration Statement on Form S-3 (File No. 333-21905) (the     
               "1997 S-3") and incorporated herein by reference)                

3.02           Amended and Restated Bylaws of Crescent Real Estate Equities     
               Company, as amended (filed as Exhibit No. 3.04 to the 1997 10-K  
               and incorporated herein by reference)                            

4.01           Registration Rights Agreement, dated February 16, 1996, by and   
               among the Registrant, Crescent Real Estate Equities Limited      
               Partnership and certain of the limited partners of Crescent Real 
               Estate Equities Limited Partnership named therein (filed as      
               Exhibit No. 4.02 to the Registrant's Annual Report on Form 10-K  
               for the fiscal year ended December 31, 1996 (the "1996 10-K")    
               and incorporated herein by reference)                            

4.02           Registration Rights Agreement, dated January 20, 1997, by and    
               among the Registrant, Crescent Real Estate Equities Limited      
               Partnership and certain of the limited partners of Crescent Real 
               Estate Equities Limited Partnership named therein (filed as      
               Exhibit No. 4.03 to the 1996 10-K and incorporated herein by     
               reference)                                                       

4.03           Form of Registration Agreement relating to the acquisition of    
               the Greenway Plaza Portfolio (filed as Exhibit No. 4.01 to the   
               Registrant's Current Report on Form 8-K dated and filed          
               September 27, 1996 (the "1996 8-K") and incorporated herein by   
               reference)                                                       

4.04           Registration Rights Agreement, dated as of June 26, 1996,        
               relating to Canyon Ranch-Tucson (filed as Exhibit No. 4.02 to    
               the 1996 8-K and incorporated herein by reference)               

24

10-Q 25th Page of 36 TOC 1st Previous Next ↓Bottom Just 25th

                                                                [Download Table]
                                                                                
4.05           Form of Common Share Certificate (filed as Exhibit No. 4.03 to   
               the 1997 S-3 and incorporated herein by reference)               

4.06           Statement of Designation of 6-3/4% Series A Convertible          
               Cumulative Preferred Shares of Crescent Real Estate Equities     
               Company (filed as Exhibit No. 4.07 to the 1997 10-K and          
               incorporated herein by reference)                                

4.07           Form of Certificate of 6-3/4% Series A Convertible Cumulative    
               Preferred Shares of Crescent Real Estate Equities Company (filed 
               as Exhibit No. 4 to the Registrant's Registration Statement on   
               Form 8-A/A filed on February 18, 1998 and incorporated herein by 
               reference)                                                       

4.08           Indenture, dated as of September 22, 1997, between Crescent Real 
               Estate Equities Limited Partnership and State Street Bank and    
               Trust Company, of Missouri, N.A. (filed as Exhibit No. 4.01 to   
               the Registration Statement on Form S-4 (File No. 333-42293) of   
               Crescent Real Estate Equities Limited Partnership (the "Form     
               S-4") and incorporated herein by reference)                      

4.09           Form of 6-5/8% Note due 2002 (filed as Exhibit No. 4.04 to the   
               Form S-4 and incorporated herein by reference)                   

4.10           Form of 7-1/8% Note due 2007 (filed as Exhibit No. 4.05 to the   
               Form S-4 and incorporated herein by reference)                   

4.11           Registration Rights Agreement, dated as of September 22, 1997,   
               among Crescent Real Estate Equities Limited Partnership, Merrill 
               Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated  
               and Salomon Brothers Inc. (filed as Exhibit No. 4.06 to the Form 
               S-4 and incorporated herein by reference)                        

4.12           Purchase Agreement, dated as of August 11, 1997, between         
               Crescent Real Estate Equities Company, UBS Securities            
               (Portfolio), LLC, and Union Bank of Switzerland, London Branch   
               (filed as Exhibit No. 4.01 to the Registrant's Current Report on 
               Form 8-K dated August 11, 1997 and filed August 13, 1997 and     
               incorporated herein by reference)                                

4.13           Purchase Agreement, effective as of December 12, 1997, among     
               Crescent Real Estate Equities Company, Crescent Real Estate      
               Equities Limited Partnership, Merrill Lynch International and    
               Merrill Lynch, Pierce, Fenner & Smith Incorporated (filed as     
               Exhibit No. 1.01 to the Registrant's Current Report on Form 8-K/A
               dated December 12, 1997 and filed December 19, 1997 and          
               incorporated herein by reference)                                

25

10-Q 26th Page of 36 TOC 1st Previous Next ↓Bottom Just 26th

                                                                [Download Table]
                                                                                
4.14           Swap Agreement, effective as of December 12, 1997, between       
               Crescent Real Estate Equities Company and Merrill Lynch          
               International (filed as Exhibit No. 1.02 to the Registrant's     
               Current Report on Form 8-K dated December 12, 1997 and filed     
               December 18, 1997 and incorporated herein by reference)          

4.15           Registration Rights Agreement, dated as of March 2, 1998, among  
               Crescent Real Estate Equities Company, Crescent Real Estate      
               Equities Limited Partnership and certain limited partners of     
               Crescent Real Estate Equities Limited Partnership (filed as      
               Exhibit No. 4.05 to the Registrant's Registration Statement on   
               Form S-3 (File No. 333-47563) and incorporated herein by         
               reference).                                                      

10.01          Second Amended and Restated Agreement of Limited Partnership of  
               Crescent Real Estate Equities Limited Partnership, dated as of   
               November 1, 1997, as amended (filed as Exhibit No. 4.06 to the   
               Registrant's Registration Statement on Form S-3 (File No.        
               333-41049) and incorporated herein by reference)                 

10.02          Noncompetition Agreement of Richard E. Rainwater as assigned to  
               Crescent Real Estate Equities Limited Partnership on May 5, 1994 
               (filed as Exhibit No. 10.02 to the 1997 10-K and incorporated    
               herein by reference)                                             

10.03          Noncompetition Agreement of John C. Goff, as assigned to         
               Crescent Real Estate Equities Limited Partnership on May 5, 1994 
               (filed as Exhibit No. 10.03 to the 1997 10-K and incorporated    
               herein by reference)                                             

10.04          Noncompetition Agreement of Gerald W. Haddock, as assigned to    
               Crescent Real Estate Equities Limited Partnership on May 5, 1994 
               (filed as Exhibit No. 10.04 to the 1997 10-K and incorporated    
               herein by reference)                                             

10.05          Employment Agreement of John C. Goff, as assigned to Crescent    
               Real Estate Equities Limited Partnership on May 5, 1994, and as  
               further amended (filed as Exhibit No. 10.05 to the 1997 10-K     
               and incorporated herein by reference)                            

10.06          Employment Agreement of Gerald W. Haddock, as assigned to        
               Crescent Real Estate Equities Limited Partnership on May 5, 1994,
               and as further amended (filed as Exhibit No. 10.06 to the 1997   
               10-K and incorporated herein by reference)                       

10.07          Form of Registration Rights, Lock-Up and Pledge Agreement (filed 
               as Exhibit No. 10.05 to the 1994 S-11 and incorporated herein by 
               reference)                                                       

10.08          Form of Officers' and Trust Managers' Indemnification Agreement  
               as entered into between the Registrant and each of its executive 
               officers and trust managers (filed as Exhibit No. 10.07 to the   
               Form S-4 and incorporated herein by reference)                   

10.09          Crescent Real Estate Equities Company 1994 Stock Incentive Plan  
               (filed as Exhibit No. 10.07 to the 1994 S-11 and incorporated    
               herein by reference)                                             

10.10          Crescent Real Estate Equities, Ltd. First Amended and Restated   
               401(k) Plan (filed as Exhibit No. 10.10 to the 1997 10-K and     
               incorporated herein by reference)                                

26

10-Q 27th Page of 36 TOC 1st Previous Next ↓Bottom Just 27th

                                                                [Download Table]
                                                                           
10.11  Real Estate Purchase and Sale Agreement, dated as of January 29,    
       1997, between Crescent Real Estate Equities Limited Partnership,    
       as purchaser, and Magellan Health Services, Inc., as seller,        
       relating to the acquisition of 92 behavioral healthcare             
       facilities (the "Behavioral Healthcare Facilities"), as amended     
       effective February 28, 1997 and May 29, 1997 (filed as Exhibit      
       No. 10.13 to the Company's Quarterly Report on Form 10-Q/A for      
       the quarter ended June 30, 1997 (the "1997 10-Q") and               
       incorporated herein by reference)                                   

10.12  Second Amended and Restated 1995 Crescent Real Estate Equities      
       Company Stock Incentive Plan (filed as Exhibit No. 10.13 to the Form
       S-4 and incorporated herein by reference)                           

27

10-Q 28th Page of 36 TOC 1st Previous Next ↓Bottom Just 28th

                                                                [Download Table]
                                                                          

10.13  Fourth Amended and Restated Revolving Credit Facility, dated       
       December 19, 1997, among Crescent Real Estate Equities Limited     
       Partnership, BankBoston, N.A. and the other banks named therein    
       (filed as Exhibit No. 10.25 to the Form S-4 and incorporated herein
       by reference)                                                      

10.14  1995 Crescent Real Estate Equities Limited Partnership Unit        
       Incentive Plan (filed as Exhibit No. 99.01 to the Registrant's     
       Registration Statement on Form S-8 (File No. 333-3452) and         
       incorporated herein by reference)                                  

10.15  1996 Crescent Real Estate Equities Limited Partnership Unit        
       Incentive Plan (filed as Exhibit No. 10.01 to the 1996 8-K and     
       incorporated herein by reference)                                  


28

10-Q 29th Page of 36 TOC 1st Previous Next ↓Bottom Just 29th

                                                                [Download Table]
                                                                               
10.16          Master Lease Agreement, dated June 16, 1997, as amended, between
               Crescent Real Estate Funding VII, L.P.  and Charter Behavioral  
               Health Systems, LLC and its subsidiaries, relating to the       
               Behavioral Healthcare Facilities (filed as Exhibit No. 10.27    
               to the 1997 10-K and incorporated herein by reference)          

10.17          Intercompany Agreement, dated June 3, 1997, between Crescent    
               Real Estate Equities Limited Partnership and Crescent Operating,
               Inc. (filed as Exhibit No. 10.2 to the Registration Statement on
               Form S-1 (File No. 333-25223) of Crescent Operating, Inc. and   
               incorporated herein by reference)                               

27.01          Financial Data Schedule (filed herewith)                        


29

10-Q 30th Page of 36 TOC 1st Previous Next ↓Bottom Just 30th

(b)      Reports on Form 8-K.                                 

                Form 8-K dated and filed January 6, 1998, for the purpose of
         filing under Item 7 - Financial Statements, Pro Forma
           Financial Information and Exhibits, certain exhibits in
                  connection with the Company's offering of 30,933 common shares
to the Senterra Real Estate Group, L.L.C.   

               Form 8-K dated January 16, 1998 and filed January 27, 1998,
                 describing under Item 5 - Other Events, the Company's pending
merger with Station Casinos.                

             Form 8-K/A filed February 13, 1998, to the Form 8-K dated
                January 16, 1998 and filed January 27, 1998, for the purpose
                 of updating, under Item 5 - Other Events, certain information
             related to the Company's pending merger with Stations and
            filing under Item 7 - Financial Statements and Pro Forma
                Financial Information and Exhibits, the Financial Statements
                for the quarter ended December 31, 1997 for Station Casinos,
            Inc. and the Pro Forma Consolidated Balance Sheet of the
          Company as of September 30, 1997 (unaudited) and notes
         thereto, and the Pro Forma Consolidated Statements of
                 Operations of the Company for the nine months ended September
                 30, 1997 and the year ended December 31, 1996 (unaudited) and
notes thereto.                              

                 Form 8-K dated February 13, 1998 and filed February 18, 1998,
                  for the purpose of filing under Item 7 - Financial Statements,
             Pro Forma Financial Information and Exhibits, exhibits in
              connection with the Company's public offering of 8,000,000
preferred shares.                           

                 Form 8-K dated February 13, 1998 and filed February 18, 1998,
                  for the purpose of filing under Item 7 - Financial Statements,
               Pro Forma Financial Information and Exhibits, the Pro Forma
                 Consolidated Balance Sheet of the Company as of September 30,
           1997 and notes thereto, and the Pro Forma Statements of
Operations of                               

30

10-Q 31st Page of 36 TOC 1st Previous Next ↓Bottom Just 31st
                the Company for the nine months ended September 30, 1997 and
         the year ended December 31, 1996 and notes thereto in
              connection with the Company's public offering of 8,000,000
preferred shares.                           

                 Form 8-K dated February 12, 1998 and filed February 23, 1998,
                  for the purpose of filing under Item 7 - Financial Statements,
             Pro Forma Financial Information and Exhibits, exhibits in
            connection with the Company's offering of 525,000 common
shares to Merrill Lynch International.      

                 Form 8-K dated December 22, 1997 and filed March 4, 1998, for
               the purpose of (i) announcing, under Item 5 - Other Events,
                 the Company's acquisitions of Energy Centre, Post Oak Central
           and Washington Harbour, and (ii) filing, under Item 7 -
             Financial Statements, Pro Forma Financial Information and
                Exhibits, the Report of Independent Public Accountants, with
             respect to Energy Centre, Post Oak Central and Washington
               Harbour, the Statements of Excess of Revenues Over Specific
                Operating Expenses and notes thereto, with respect to Energy
                  Centre, Post Oak Central and Washington Harbour, the Pro Forma
                 Consolidated Balance Sheet as of September 30, 1997 and notes
                thereto, and Pro Forma Consolidated Statements of Operations
             for the nine months ended September 30, 1997 and the year
ended December 31, 1996 and notes thereto.  

31

10-Q 32nd Page of 36 TOC 1st Previous Next ↓Bottom Just 32nd

SIGNATURES

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

                 CRESCENT REAL ESTATE EQUITIES COMPANY

         /s/ Gerald W. Haddock
                                  ----------------------------------------------
Date: May 15, 1998                Gerald W. Haddock, President and Chief        
     Executive Officer

       /s/ Dallas E. Lucas
                                  ----------------------------------------------
Date: May 15, 1998                Dallas E. Lucas, Senior Vice President, Chief 
                                  Financial Officer and Chief Accounting Officer

32

10-Q 33rd Page of 36 TOC 1st Previous Next ↓Bottom Just 33rd
INDEX TO EXHIBITS 

                                                                [Download Table]

EXHIBIT                                                                         
NUMBER         DESCRIPTION OF EXHIBIT                                           
-------        ----------------------                                           
                                                                                
2.01           Agreement and Plan of Merger, dated as of January 16, 1998, as   
               amended, by and between Crescent Real Estate Equities Company    
               and Station Casinos, Inc. (filed as Exhibit No. 2.01 to the      
               Registrant's Annual Report on Form 10-K for the fiscal year ended
               December 31, 1997, as amended (the "1997 10-K") and incorporated 
               herein by reference)                                             

3.01           Restated Declaration of Trust of Crescent Real Estate Equities   
               Company (filed as Exhibit No. 4.01 to the Registrant's           
               Registration Statement on Form S-3 (File No. 333-21905) (the     
               "1997 S-3") and incorporated herein by reference)                

3.02           Amended and Restated Bylaws of Crescent Real Estate Equities     
               Company, as amended (filed as Exhibit No. 3.04 to the 1997 10-K  
               and incorporated herein by reference)                            

4.01           Registration Rights Agreement, dated February 16, 1996, by and   
               among the Registrant, Crescent Real Estate Equities Limited      
               Partnership and certain of the limited partners of Crescent Real 
               Estate Equities Limited Partnership named therein (filed as      
               Exhibit No. 4.02 to the Registrant's Annual Report on Form 10-K  
               for the fiscal year ended December 31, 1996 (the "1996 10-K")    
               and incorporated herein by reference)                            

4.02           Registration Rights Agreement, dated January 20, 1997, by and    
               among the Registrant, Crescent Real Estate Equities Limited      
               Partnership and certain of the limited partners of Crescent Real 
               Estate Equities Limited Partnership named therein (filed as      
               Exhibit No. 4.03 to the 1996 10-K and incorporated herein by     
               reference)                                                       

4.03           Form of Registration Agreement relating to the acquisition of    
               the Greenway Plaza Portfolio (filed as Exhibit No. 4.01 to the   
               Registrant's Current Report on Form 8-K dated and filed          
               September 27, 1996 (the "1996 8-K") and incorporated herein by   
               reference)                                                       

4.04           Registration Rights Agreement, dated as of June 26, 1996,        
               relating to Canyon Ranch-Tucson (filed as Exhibit No. 4.02 to    
               the 1996 8-K and incorporated herein by reference)               

10-Q 34th Page of 36 TOC 1st Previous Next ↓Bottom Just 34th

                                                                [Download Table]
                                                                                
4.05           Form of Common Share Certificate (filed as Exhibit No. 4.03 to   
               the 1997 S-3 and incorporated herein by reference)               

4.06           Statement of Designation of 6-3/4% Series A Convertible          
               Cumulative Preferred Shares of Crescent Real Estate Equities     
               Company (filed as Exhibit No. 4.07 to the 1997 10-K and          
               incorporated herein by reference)                                

4.07           Form of Certificate of 6-3/4% Series A Convertible Cumulative    
               Preferred Shares of Crescent Real Estate Equities Company (filed 
               as Exhibit No. 4 to the Registrant's Registration Statement on   
               Form 8-A/A filed on February 18, 1998 and incorporated herein by 
               reference)                                                       

4.08           Indenture, dated as of September 22, 1997, between Crescent Real 
               Estate Equities Limited Partnership and State Street Bank and    
               Trust Company, of Missouri, N.A. (filed as Exhibit No. 4.01 to   
               the Registration Statement on Form S-4 (File No. 333-42293) of   
               Crescent Real Estate Equities Limited Partnership (the "Form     
               S-4") and incorporated herein by reference)                      

4.09           Form of 6-5/8% Note due 2002 (filed as Exhibit No. 4.04 to the   
               Form S-4 and incorporated herein by reference)                   

4.10           Form of 7-1/8% Note due 2007 (filed as Exhibit No. 4.05 to the   
               Form S-4 and incorporated herein by reference)                   

4.11           Registration Rights Agreement, dated as of September 22, 1997,   
               among Crescent Real Estate Equities Limited Partnership, Merrill 
               Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated  
               and Salomon Brothers Inc. (filed as Exhibit No. 4.06 to the Form 
               S-4 and incorporated herein by reference)                        

4.12           Purchase Agreement, dated as of August 11, 1997, between         
               Crescent Real Estate Equities Company, UBS Securities            
               (Portfolio), LLC, and Union Bank of Switzerland, London Branch   
               (filed as Exhibit No. 4.01 to the Registrant's Current Report on 
               Form 8-K dated August 11, 1997 and filed August 13, 1997 and     
               incorporated herein by reference)                                

4.13           Purchase Agreement, effective as of December 12, 1997, among     
               Crescent Real Estate Equities Company, Crescent Real Estate      
               Equities Limited Partnership, Merrill Lynch International and    
               Merrill Lynch, Pierce, Fenner & Smith Incorporated (filed as     
               Exhibit No. 1.01 to the Registrant's Current Report on Form 8-K/A
               dated December 12, 1997 and filed December 19, 1997 and          
               incorporated herein by reference)                                

10-Q 35th Page of 36 TOC 1st Previous Next ↓Bottom Just 35th

                                                                [Download Table]
                                                                                
4.14           Swap Agreement, effective as of December 12, 1997, between       
               Crescent Real Estate Equities Company and Merrill Lynch          
               International (filed as Exhibit No. 1.02 to the Registrant's     
               Current Report on Form 8-K dated December 12, 1997 and filed     
               December 18, 1997 and incorporated herein by reference)          

4.15           Registration Rights Agreement, dated as of March 2, 1998, among  
               Crescent Real Estate Equities Company, Crescent Real Estate      
               Equities Limited Partnership and certain limited partners of     
               Crescent Real Estate Equities Limited Partnership (filed as      
               Exhibit No. 4.05 to the Registrant's Registration Statement on   
               Form S-3 (File No. 333-47563) and incorporated herein by         
               reference).                                                      

10.01          Second Amended and Restated Agreement of Limited Partnership of  
               Crescent Real Estate Equities Limited Partnership, dated as of   
               November 1, 1997, as amended (filed as Exhibit No. 4.06 to the   
               Registrant's Registration Statement on Form S-3 (File No.        
               333-41049) and incorporated herein by reference)                 

10.02          Noncompetition Agreement of Richard E. Rainwater as assigned to  
               Crescent Real Estate Equities Limited Partnership on May 5, 1994 
               (filed as Exhibit No. 10.02 to the 1997 10-K and incorporated    
               herein by reference)                                             

10.03          Noncompetition Agreement of John C. Goff, as assigned to         
               Crescent Real Estate Equities Limited Partnership on May 5, 1994 
               (filed as Exhibit No. 10.03 to the 1997 10-K and incorporated    
               herein by reference)                                             

10.04          Noncompetition Agreement of Gerald W. Haddock, as assigned to    
               Crescent Real Estate Equities Limited Partnership on May 5, 1994 
               (filed as Exhibit No. 10.04 to the 1997 10-K and incorporated    
               herein by reference)                                             

10.05          Employment Agreement of John C. Goff, as assigned to Crescent    
               Real Estate Equities Limited Partnership on May 5, 1994, and as  
               further amended (filed as Exhibit No. 10.05 to the 1997 10-K     
               and incorporated herein by reference)                            

10.06          Employment Agreement of Gerald W. Haddock, as assigned to        
               Crescent Real Estate Equities Limited Partnership on May 5, 1994,
               and as further amended (filed as Exhibit No. 10.06 to the 1997   
               10-K and incorporated herein by reference)                       

10.07          Form of Registration Rights, Lock-Up and Pledge Agreement (filed 
               as Exhibit No. 10.05 to the 1994 S-11 and incorporated herein by 
               reference)                                                       

10.08          Form of Officers' and Trust Managers' Indemnification Agreement  
               as entered into between the Registrant and each of its executive 
               officers and trust managers (filed as Exhibit No. 10.07 to the   
               Form S-4 and incorporated herein by reference)                   

10.09          Crescent Real Estate Equities Company 1994 Stock Incentive Plan  
               (filed as Exhibit No. 10.07 to the 1994 S-11 and incorporated    
               herein by reference)                                             

10.10          Crescent Real Estate Equities, Ltd. First Amended and Restated   
               401(k) Plan (filed as Exhibit No. 10.10 to the 1997 10-K and     
               incorporated herein by reference)                                

10-Q Last Page of 36 TOC 1st Previous Next ↓Bottom Just 36th

                                                                [Download Table]
                                                                           
10.11  Real Estate Purchase and Sale Agreement, dated as of January 29,    
       1997, between Crescent Real Estate Equities Limited Partnership,    
       as purchaser, and Magellan Health Services, Inc., as seller,        
       relating to the acquisition of 92 behavioral healthcare             
       facilities (the "Behavioral Healthcare Facilities"), as amended     
       effective February 28, 1997 and May 29, 1997 (filed as Exhibit      
       No. 10.13 to the Company's Quarterly Report on Form 10-Q/A for      
       the quarter ended June 30, 1997 (the "1997 10-Q") and               
       incorporated herein by reference)                                   

10.12  Second Amended and Restated 1995 Crescent Real Estate Equities      
       Company Stock Incentive Plan (filed as Exhibit No. 10.13 to the Form
       S-4 and incorporated herein by reference)                           

10.13  Fourth Amended and Restated Revolving Credit Facility, dated        
       December 19, 1997, among Crescent Real Estate Equities Limited      
       Partnership, BankBoston, N.A. and the other banks named therein     
       (filed as Exhibit No. 10.25 to the Form S-4 and incorporated herein 
       by reference)                                                       

10.14  1995 Crescent Real Estate Equities Limited Partnership Unit         
       Incentive Plan (filed as Exhibit No. 99.01 to the Registrant's      
       Registration Statement on Form S-8 (File No. 333-3452) and          
       incorporated herein by reference)                                   

10.15  1996 Crescent Real Estate Equities Limited Partnership Unit         
       Incentive Plan (filed as Exhibit No. 10.01 to the 1996 8-K and      
       incorporated herein by reference)                                   

10.16  Master Lease Agreement, dated June 16, 1997, as amended, between    
       Crescent Real Estate Funding VII, L.P.  and Charter Behavioral      
       Health Systems, LLC and its subsidiaries, relating to the           
       Behavioral Healthcare Facilities (filed as Exhibit No. 10.27        
       to the 1997 10-K and incorporated herein by reference)              

10.17  Intercompany Agreement, dated June 3, 1997, between Crescent        
       Real Estate Equities Limited Partnership and Crescent Operating,    
       Inc. (filed as Exhibit No. 10.2 to the Registration Statement on    
       Form S-1 (File No. 333-25223) of Crescent Operating, Inc. and       
       incorporated herein by reference)                                   

27.01  Financial Data Schedule (filed herewith)

10-Q	1st Page of 36	TOC	↑Top	Previous	Next	↓Bottom	Just 1st

10-Q	2nd Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 2nd

10-Q	3rd Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 3rd

10-Q	4th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 4th

10-Q	5th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 5th

10-Q	6th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 6th

10-Q	7th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 7th

10-Q	8th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 8th

10-Q	9th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 9th

10-Q	10th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 10th

10-Q	11th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 11th

10-Q	12th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 12th

10-Q	13th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 13th

10-Q	14th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 14th

10-Q	15th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 15th

10-Q	16th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 16th

10-Q	17th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 17th

10-Q	18th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 18th

10-Q	19th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 19th

10-Q	20th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 20th

10-Q	21st Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 21st

10-Q	22nd Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 22nd

10-Q	23rd Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 23rd

10-Q	24th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 24th

10-Q	25th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 25th

10-Q	26th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 26th

10-Q	27th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 27th

10-Q	28th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 28th

10-Q	29th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 29th

10-Q	30th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 30th

10-Q	31st Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 31st

10-Q	32nd Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 32nd

10-Q	33rd Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 33rd

10-Q	34th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 34th

10-Q	35th Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 35th

10-Q	Last Page of 36	TOC	1st	Previous	Next	↓Bottom	Just 36th

Dates Referenced Herein and Documents Incorporated by Reference

		Referenced-On Page
This ‘10-Q’ Filing	Date	First	Last	Other Filings

Filed on:	5/15/98	10	32	10-K/A
	5/8/98	1
	5/5/98	12
	5/1/98	12
	4/28/98	13		8-K
	4/27/98	11		424B5, 8-K, 8-K/A
	4/23/98	12		8-K, DEF 14A
	4/20/98	12
	4/17/98	13		8-K, 8-K/A
	4/8/98	12
For Period End:	3/31/98	1	23	10-K
	3/25/98	11	15
	3/21/98	10
	3/19/98	7
	3/4/98	31		8-K
	3/2/98	26	35
	2/23/98	31		424B5, 8-K
	2/19/98	10	15
	2/18/98	25	34	424B5, 8-A12B/A, 8-K
	2/13/98	11	30	8-A12B, 8-K, 8-K/A
	2/12/98	31		8-K, SC 13G/A
	2/3/98	10
	1/27/98	11	30	8-K
	1/20/98	10
	1/16/98	11	33	8-K, 8-K/A
	1/6/98	30		424B5, 8-K
	1/1/98	11
	12/31/97	2	33	10-K, 10-K/A, 11-K
	12/22/97	31		8-K, S-3/A
	12/19/97	10	36	8-K/A
	12/18/97	26	35	424B5, 8-K
	12/12/97	25	35	8-K, 8-K/A
	11/1/97	26	35
	9/30/97	30	31	10-Q, 10-Q/A, 8-K, 8-K/A
	9/22/97	10	34	8-K
	8/13/97	25	34	424B5, 8-K
	8/11/97	25	34
	6/30/97	27	36	10-Q, 10-Q/A
	6/16/97	29	36
	6/3/97	29	36
	5/29/97	27	36
	3/31/97	2	21	10-Q
	2/28/97	27	36	8-K, 8-K/A
	1/29/97	27	36	8-K, 8-K/A
	1/28/97	18
	1/20/97	24	33
	1/1/97	14
	12/31/96	24	33	10-K405, 10-K405/A, 11-K
	9/27/96	24	33	8-K, 8-K/A
	6/26/96	24	33
	2/16/96	24	33
	5/5/94	26	35
				List all Filings

↑Top

Filing Submission 0000950134-98-004553 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Crescent Real Estate Equities Co – ‘10-Q’ for 3/31/98

As of: Friday, 5/15/98 · For: 3/31/98 · Accession #: 950134-98-4553 · File #: 1-13038

Previous ‘10-Q’: ‘10-Q/A’ on 12/5/97 for 9/30/97 · Next: ‘10-Q’ on 8/14/98 for 6/30/98 · Latest: ‘10-Q’ on 5/9/07 for 3/31/07

Quarterly Report — Form 10-QFiling Table of Contents

10-Q — Form 10-Q for Quarter Ended March 31, 1998Document Table of Contents

Dates Referenced Herein and Documents Incorporated by Reference

Quarterly Report — Form 10-Q
Filing Table of Contents

10-Q — Form 10-Q for Quarter Ended March 31, 1998
Document Table of Contents