Lexington Realty Trust Announces Fourth Quarter Transaction Activity

NEW YORK, Jan. 11 /PRNewswire-FirstCall/ -- Lexington Realty Trust ("Lexington") , a real estate investment trust, today announced the following additional transactions that occurred during the quarter ended December 31, 2006. For a complete summary of Lexington's fourth quarter transaction activity, see the Transaction Summary attached to this press release.

Leasing/Expansion Activity Danville, Illinois

Lexington entered into a lease amendment and development agreement with The Sygma Network, Inc., the tenant at its Danville, Illinois facility. The lease amendment and development agreement provide for the construction of a 54,350 square foot expansion to the existing warehouse facility and a 1,300 square foot equipment maintenance shop. In connection with the expansion, the current lease term will be extended and expire 15 years from the commencement of rent on the expansion space.

Hebron, Ohio

Lexington entered into a new lease agreement with Owens Corning Sales, Inc. for one of its facilities in Hebron, Ohio. The previous lease for the facility was rejected in October 2006 prior to Owens Corning's emergence from bankruptcy. The new lease expires on July 31, 2007.

Richmond, Virginia

One of Lexington's institutional joint venture investment programs entered into a new lease with Allied International Credit Corp. for approximately 24,400 square feet (36.1% of the rentable square feet of the building) at its facility located at in Richmond, Virginia which was formerly leased to Capital One. The lease has a term of five years and four months and commences on March 1, 2007. Allied International Credit Corp. is a privately-owned company that specializes in debt collection for major financial institution and financing companies.

Oberlin, Ohio and Plymouth Michigan

Lexington entered into lease extensions with Johnson Controls, Inc. for its Oberlin, Ohio and Plymouth, Michigan facilities. The Oberlin, Ohio lease with Johnson Controls, Inc., due to expire on December 23, 2006, has been extended to December 31, 2007, with no further renewal rights or purchase options. The Plymouth, Michigan lease with Johnson Controls, Inc., due to expire on December 23, 2006, has been extended until August 31, 2007, with two one-month renewal options.

Glendale, Arizona

Lexington entered into a lease extension with Honeywell International, Inc. for its Glendale, Arizona facility. The lease, which had been due to expire on July 15, 2006, has been extended until July 15, 2011, with one five- year renewal option.

Klamath Falls, Oregon

Fred Meyer Stores, Inc., the tenant in Lexington's Klamath Falls, Oregon facility, exercised its renewal option and extended the lease, due to expire on March 31, 2008, to March 31, 2018. Fred Meyer Stores, Inc. has the right to purchase the facility at the expiration of the primary term and each renewal term thereafter at fair market value. Fred Meyer also delivered notice of its intention to exercise their purchase option at the expiration of the primary term (March 31, 2008).

Marshall, Michigan

Lexington entered into a lease extension with Joseph Campbell Company for its Marshall, Michigan facility. The lease, due to expire on August 31, 2007, has been extended until August 31, 2008, with one remaining one-year renewal option.

Acquisitions

As previously disclosed, Lexington acquired six properties for an aggregate capitalized cost of approximately $118.1 million, including three properties for an aggregate capitalized cost of approximately $36.3 million in Lexington Strategic Asset Corp.

In addition, Lexington increased its ownership in Lexington Strategic Asset Corp. from 32.3% of the outstanding common shares to approximately 76.2%.

Disposition

Lexington sold its Jackson, Tennessee facility leased to Kirkland's, Inc. to a third party for net proceeds of approximately $18.1 million. Lexington acquired the property in 2004 for approximately $15.7 million and expects to record a gain of approximately $4.0 million on the sale. In connection with the sale, Lexington completed a defeasance of the first mortgage financing secured by the facility and incurred a debt satisfaction charge of approximately $1.3 million.

Refinancing Activity

Lexington's Farmington Hills, Michigan facility, formerly leased to Dana Corporation, was released from the first mortgage secured by the facility when Lexington made a discounted payoff in the amount of $7.5 million and forfeited an escrow account which held approximately $5.4 million, consisting of the proceeds Lexington received when it sold its Dana bankruptcy claim. Immediately prior to the payoff, the first mortgage loan had an unpaid principal amount of approximately $20.5 million. As a result, Lexington expects to realize a gain of approximately $7.6 million in the fourth quarter of 2006. In addition, Lexington expects to record an impairment charge of approximately $6.1 million on this property.

Financing Activities

During the fourth quarter of 2006, Lexington obtained $59.2 million in non-recourse mortgages with a weighted-average fixed interest rate of 6.03%, including $30.3 million mortgages obtained by Lexington Strategic Asset Corp. at a weighted-average fixed interest rate of 6.15%.

Newkirk Transaction Activity

As previously announced, Lexington consummated its merger with Newkirk on December 31, 2006. The following is a summary of Newkirk's transaction activity during the quarter ended December 31, 2006.

Leasing/Expansion Activity -- Xerox Corporation elected to renew its lease term for an additional five years at the facility it leases in Palo Alto, California. After giving effect to the renewal term, the lease is scheduled to expire on December 13, 2013. -- A new five year lease was entered into with DirecTV, Inc. for 205,000 square feet of space at the El Segundo, California property. Newkirk's operating partnership holds a 53% interest in this property. DirecTV, which presently occupies the space as a subtenant of Raytheon, houses its corporate headquarters at the property. The new five year lease commences in January 2009 upon the expiration of the current Raytheon lease and provides for annual rent of approximately $2.7 million with annual 2% increases. With this new lease, the entire 550,000 square feet of office space at this property in leased through 2013, with 345,000 square feet being leased through 2018. -- A lease extension with Federal Express for its 521,000 square foot office property located in Memphis, Tennessee which provides for an extension of the lease term to June 2019. -- A lease renewal with Entergy Gulf States for 125,000 square feet (with a tenant option for an additional 25,000 square feet) at its 426,000 square foot Beaumont, Texas property. -- A lease renewal with Walgreens for its 356,000 square foot facility in Windsor, Wisconsin which provides for an extension of the lease term to February 2012. -- Lease renewal at a retail property containing an aggregate of approximately 35,000 square feet. -- Committed to an 86,000 square foot expansion at its suburban Atlanta, Georgia property leased to Atlas Cold Storage at a cost of $7.1 million. Acquisitions -- Acquired a 310,000 square foot warehouse, distribution and light manufacturing facility located in Lumberton, North Carolina for a purchase price of $15.3 million. The property, which is currently being expanded to approximately 425,000 square feet, is currently net leased through November 2021 to Quickie Manufacturing Corporation, a cleaning tools manufacturer. -- Acquired a 247,000 square foot warehouse facility located in Cincinnati, Ohio for a purchase price of $9.55 million. The property is currently net leased through August 2016 to The Hillman Group Inc., a leading fastener and hardware company. Refinancing Activity -- In conjunction with the DirecTV lease mentioned above, the first mortgage encumbering the El Segundo, California property was refinanced with a new $55.0 million mortgage loan which bears interest at 5.675% and matures on December 5, 2016. The loan requires monthly payments based on a 30 year amortization schedule ($318,350 per month). Debt Investments -- Concord Debt Holdings LLC, a joint venture debt platform owned 50% by Newkirk's operating partnership and 50% by Winthrop Realty Trust, closed its first collateralized debt obligation (CDO) issued by two newly-formed subsidiaries of Concord. An aggregate of $377 million of investment grade-rated debt was issued. Concord retained an equity interest in the portfolio with a notional amount of $88 million. The notes have an initial weighted average spread of approximately 50 basis points over one-month LIBOR. The facility has a five-year replenishment period that allows the principal proceeds from repayments of the collateral assets to be reinvested in qualifying replacement assets, subject to certain conditions. Fourth Quarter 2006 Results

Lexington will announce its quarterly results before the market opens on Thursday, February 22, 2007. Management will discuss the financial results and Lexington's business plan on a conference call at 2:00 p.m. Eastern time. The toll-free dial-in number is 1-800-218-0204. A replay of the conference call will be available through March 1, 2007. The toll-free telephone number for the replay is 1-800-405-2236, passcode 11080978. International callers can access the conference call by dialing 1-303-262-2140 and the replay by dialing 1-303-590-3000, passcode 11080978 (same passcode). The conference call can also be accessed on the internet at http://www.lxp.com/ .

Dividend Allocation Information

In addition, Lexington reported the final income allocations of its 2006 dividend on its common shares and preferred shares as they will be reported on Form 1099-DIV.

Common Shares Unrecap- Long- tured Term Section Cash Qualified Capital 1250 Distribution Taxable Return Dividend Gain Gain Record Payable Per Ordinary of (15% (15% (25% Date Date Share Dividend Capital Rate) Rate) Rate) 01/31/2006 02/14/2006 $0.365000 72.30% 17.24% 0.00% 6.84% 3.62% 04/28/2006 05/15/2006 $0.365000 54.54% 17.24% 0.00% 15.41% 12.81% 07/31/2006 08/15/2006 $0.365000 82.76% 17.24% 0.00% 0.00% 0.00% 10/02/2006 10/16/2006 $0.365000 65.94% 17.24% 3.08% 9.63% 4.11% Series B Cumulative Redeemable Preferred Shares Unrecap- Long- tured Term Section Cash Qualified Capital 1250 Distribution Taxable Return Dividend Gain Gain Record Payable Per Ordinary of (15% (15% (25% Date Date Share Dividend Capital Rate) Rate) Rate) 01/31/2006 02/15/2006 $0.503125 87.37% 0.00% 0.00% 8.26% 4.37% 04/28/2006 05/15/2006 $0.503125 65.90% 0.00% 0.00% 18.62% 15.48% 07/31/2006 08/15/2006 $0.503125 100.00% 0.00% 0.00% 0.00% 0.00% 10/31/2006 11/15/2006 $0.503125 79.69% 0.00% 3.72% 11.63% 4.96% Series C Cumulative Convertible Preferred Shares Unrecap- Long- tured Term Section Cash Qualified Capital 1250 Distribution Taxable Return Dividend Gain Gain Record Payable Per Ordinary of (15% (15% (25% Date Date Share Dividend Capital Rate) Rate) Rate) 01/31/2006 02/15/2006 $0.812500 87.37% 0.00% 0.00% 8.26% 4.37% 04/28/2006 05/15/2006 $0.812500 65.90% 0.00% 0.00% 18.62% 15.48% 07/31/2006 08/15/2006 $0.812500 100.00% 0.00% 0.00% 0.00% 0.00% 10/31/2006 11/15/2006 $0.812500 79.69% 0.00% 3.72% 11.63% 4.96% About Lexington

Lexington is a real estate investment trust that owns and manages office, industrial and retail properties net-leased to major corporations throughout the United States and provides investment advisory and asset management services to investors in the net lease area. Lexington currently pays an annualized dividend of $1.46 per share. Additional information about Lexington is available at http://www.lxp.com/ .

This release contains certain forward-looking statements which involve known and unknown risks, uncertainties or other factors not under Lexington's control which may cause actual results, performance or achievements of Lexington to be materially different from the results, performance, or other expectations implied by these forward-looking statements. These factors include, but are not limited to, those factors and risks detailed in Lexington's periodic filings with the Securities and Exchange Commission. Lexington undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the occurrence of unanticipated events. Accordingly, there is no assurance that Lexington's expectations will be realized.

LEXINGTON REALTY TRUST 2006 Fourth Quarter Transaction Summary ($000's) Acquisitions Average Current Annual Annual Curr- Capital- GAAP Average Cash ent Tenants/ Property ized Rent, GAAP Rent, Cash Lease Guarantors Location Type Costs net Yield net Yield Term Hnedak Bobo Memphis, Office $5,353 $501 9.4% 484 9.0 11-16 Group TN Inc. (1) Northrop Pascagoula, Office 6,442 679 10.5 679 10.5 10-08 Grumman MS Systems Corporation(1) Hagemeyer Charleston, Office 10,560 840 8.0 763 7.2 07-20 North SC American, Inc. CAE Whippany, Office 24,457 2,327 9.5 2,231 9.1 11-21 SimuFlite, NJ Inc. (1) BMW Financial Hilliard, Office 36,239 2,591 7.1 2,541 7.0 02-21 Services NA, OH LLC Multi-tenant Honolulu, Office 35,057 2,178 6.2 2,178 6.2 Various HI $118,108 $9,116 7.7% $8,876 7.5% Dispositions Tenants/ Property Guarantors Location Type Net Sale Price Net Book Value Kirkland's, Inc. Jackson, TN Industrial $18,057 $14,044 New Leases/Lease Extensions Extend- Rent Tenants/ Property Previous ed Per Square Guarantors Location Type Term Term Annum Feet Johnson Controls, Oberlin, Industrial 12-06 12-07 $748 111,160 Inc. OH Allied Richmond, Office - 06-12 446 24,375 International VA Credit Honeywell Glendale, Office 07-06 07-11 2,452 252,340 International, AZ Inc. Johnson Controls, Plymouth, Industrial 12-06 08-07 1,033 134,160 Inc. MI Owens Corning, Hebron, Industrial 10-06 07-07 658 250,410 Inc. OH Fred Meyer Klamath Retail 03-08 03-18 1,153 178,204 Stores, Inc. Falls, OH Joseph Campbell Marshall, Industrial 08-07 08-08 144 53,600 Company MI New Financings Maturity Tenants/Guarantors Location Amount Rate Date Parkway Chevrolet, Inc. (1) Tomball, TX $9,425 6.06% 11-16 CAE SimuFlite, Inc. (1) Whippany, NJ 16,900 6.30% 11-21 BMW Financial Services NA, LLC Hilliard, OH 28,960 5.91% 02-21 Hnedak Bobo Group, Inc. (1) Memphis, TN 3,951 5.71% 01-17 $59,236 6.03% (1) Lexington currently has a 7.62% interest in this property.