Duke Announces Second Quarter Investment Activity.

Business & Real Estate Editors

Duke Realty Corporation (NYSE:DRE) announced today approximately $69 million of new developments and acquisitions and $30 million of new third-party construction contracts for the second quarter of 2002. The Company also announced that it sold $85 million of properties during the quarter.

Duke's $69 million of new developments and acquisitions announced today average 76 percent pre-leased and total 1.3 million square feet with an expected stabilized return of 11.0 percent. This includes $67 million for the Company's held-for-rental portfolio and $2 million for the Company's held-for-sale portfolio. The most significant of these projects is a 275,000 square foot industrial building that is 100 percent pre-leased and located at Duke's Park 27 in Orlando, Florida. Also in Orlando, Duke is developing a 154,000 square foot industrial building that is 100 percent pre-leased to Brede-Allied Convention Service Inc.

The Company's other new developments announced today include:

-- Year-to-date development starts that the Company plans to own indefinitely upon completion total $79 million compared to earlier projections of $100 million to $220 million for all of 2002;

-- Year-to-date development starts that Duke plans to sell upon completion total $7 million compared to earlier projections of $30 million to $50 million for all of 2002;

-- Year-to-date acquisitions total $33 million compared to earlier projections of $100 million to $200 million for all of 2002; and

-- Year-to-date third-party construction starts total $52 million compared to earlier projections of $175 million to $250 million for all of 2002.

Also, during the second quarter of 2002, Duke's new acquisitions totaled $23 million and included a 156,000 square foot suburban office building in St. Louis; a 75,000 square foot industrial building in Cleveland, Ohio; and a 50 percent interest in a 48,000 square foot suburban office building located in Indianapolis.

Duke's $85 million of second quarter dispositions announced today include $79 million of properties from the Company's held-for-sale portfolio. Approximately $33 million of the Company's second quarter dispositions were sold via newly negotiated transactions at an average capitalization rate of 9.6 percent, and the remaining $52 million were sold pursuant to tenant purchase options. These dispositions were 79 percent leased in the aggregate and include:

-- Year-to-date development starts that the Company plans to own indefinitely upon completion total $79 million compared to earlier projections of $100 million to $220 million for all of 2002;

-- Year-to-date development starts that Duke plans to sell upon completion total $7 million compared to earlier projections of $30 million to $50 million for all of 2002;

-- Year-to-date acquisitions total $33 million compared to earlier projections of $100 million to $200 million for all of 2002; and

-- Year-to-date third-party construction starts total $52 million compared to earlier projections of $175 million to $250 million for all of 2002.

With today's announcements, Duke's new development, construction and acquisition activity for the first half of the year compares to previous guidance for all of 2002 as follows:

-- Year-to-date development starts that the Company plans to own indefinitely upon completion total $79 million compared to earlier projections of $100 million to $220 million for all of 2002;

-- Year-to-date development starts that Duke plans to sell upon completion total $7 million compared to earlier projections of $30 million to $50 million for all of 2002;

-- Year-to-date acquisitions total $33 million compared to earlier projections of $100 million to $200 million for all of 2002; and

-- Year-to-date third-party construction starts total $52 million compared to earlier projections of $175 million to $250 million for all of 2002.

Duke Realty Corporation is the largest publicly traded office and industrial real estate company in the United States and a member of the Forbes Super 500. Offering a complete range of real estate products and services, Duke produces approximately $800 million in annual revenue from approximately 4,500 tenants and focuses on building dominant market positions in each of its 13 geographic platforms across the Midwest and the Sunbelt. Duke owns interests in more than 107 million square feet of properties, has approximately 1,050 employees and owns or controls over 4,200 acres of undeveloped land that can support more than 64 million square feet of future development. Visit Duke on the web at www.dukerealty.com.