Good morning and welcome to the Lexington Realty Trust’s Fourth Quarter 2013 Earnings Conference Call. At this time, all participants have been placed in a listen-only mode and the floor will be opened for your questions following the presentation. Today’s conference is being recorded. It is now my pleasure to turn the floor over to your host for today Ms. Gabby Reyes, Investor Relations for Lexington Realty Trust. Please go ahead, ma’am.

Hi, and welcome to the Lexington Reality Trust fourth quarter 2013 conference call. The earnings press release was distributed over the wire this morning and the release and supplemental disclosure package will be furnished on a Form 8-K. In the press release and supplemental disclosure package, Lexington has reconciled all historical non-GAAP financial measures to the most directly comparable GAAP measure in accordance with Reg G requirements. If you did not receive a copy, these documents are available on Lexington’s website at www.lxp.com in the Investor Relations section. Additionally, we are hosting a live webcast of today’s call, which you can access in the same section. At this time, we’d like to inform you that certain statements made during this conference call, which are not historical, may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although Lexington believes expectations reflected in any forward-looking statements are based on reasonable assumptions, Lexington can give no assurance that its expectations will be attained. Factors and risks that could cause actual results to differ materially from those expressed or implied by forward-looking statements are detailed in today’s press release and from time-to-time in Lexington’s filings with the SEC and includes the successful confirmation of any of lease, acquisition, build-to-suit financing or other transactions or the final terms of any such transaction. Lexington does not undertake a duty to update any forward-looking statements. Joining me today from management are Will Eglin, Chief Executive Officer; Robert Roskind, Chairman; Rick Rouse, Chief Investment Officer; Patrick Carroll, Chief Financial Officer, and other members of management.

Thank you, Gabby and welcome everyone and thank you for joining the call today. As always I would like to begin our operating results and accomplishment for the quarter. For the fourth quarter 2013 our company’s funds from operations as adjusted were $0.28 per share, a 12% increase compared to the prior year, primarily driven by strong investment activity and interest savings that we captured throughout the year with our refinancing activity. In 2013, we invested $717.6 million, lowered our weighted average cost per debt financing by approximately 70 basis points through 5.4% to 4.7%, and executed leases totaling 5.7 million square feet and in the year 97.6% lease for the balance roll over schedule. These accomplishments are reflected in the guidance we announced today for Company’s funds from operations per share of $1.11 to $1.15 for 2014 which represent growth of 9% to 13% over 2013. Looking more closely at our results, the fourth quarter featured strong execution on the investment front with the total $428.9 million put to work which consisted of $19.9 million invested active build-to-suit projects, $362.2 million in acquisition, $39.4 million in financing and the completion of a build-to-suit project totaling $7.4 million. In addition, we placed one build-to-suit project of a contract for a commitment of $12.8 million during the fourth quarter. Subsequent to quarter end we completed the $42.6 million industrial build-to-suit for Easton Bell Sports, purchased a newly constructed office property subject to a 19 year lease for $13.9 million and entered into a forward commitment to acquire build-to-suit office property for $40 million. We are building our pipeline for 2014 and 2015, and at this point we believe build-to-suit funding will total about $200 million to $225 million in 2014 based on current transaction activity. In addition, we believe we have…

Thanks, Wil. During the quarter Lexington has gross revenues of $109.6 million comprised primarily of lease rents and tenant reimbursement. The increase compared to the fourth quarter of 2012 of $17.5 million relates primarily to the acquisition and build-to-suit projects coming online and an increase in rent in our Baltimore, Maryland and Orlando, Florida properties. In the quarter, GAAP rents were in excess of cash rents by approximately $14.4 million including the effects of above and below market leases. For the year ended December 31, 2013, GAAP rents were in excess of cash rents by approximately $22.8 million. On Page 19 of the supplemented, we have included our estimates of both cash and GAAP rents for the year 2014 through 2018 for leases in place at December 31, 2013. It also includes same store NOI data and weighted average lease term of our portfolio as of December 31, 2013 and 2012. The difference between cash and GAAP rents is currently expected to be about $37 million in 2014. The most significant difference between cash and GAAP rents related to the 99 year leases on our New York City land portfolio. Property operating expenses increased primarily due to the increased use in occupancy in our multi-tenant properties which has a base year cost structure. In the fourth quarter 2013, we recorded $22.6 million in impairment of properties, $19.3 million of which relates for Bridgewater, New Jersey property in which the tenant will not be renewing its lease in the fourth quarter of 2014. The properties encumbered by non-request mortgage of $14.3 million and our current basis after our write down are $8.3 million. We’ve also recorded a loan-loss reserves of about $13.9 million in the fourth quarter 2013 on a loan collateralized by property in Westmont Illinois, the tenant exercise its…

Thanks, Pat. In summary, we had another strong year and we believe 2014 will be a pivotal year for us and one where business will become far less capital-intensive than it has been. This is no surprise given the changes in our portfolio after the last several years. The impact of our acquisition activity combined with our capital recycling is change the composition of our portfolio, and made our cash flow as far more secure with better growth prospects given the number of leases we have with annual escalation. We expect to continue to one, execute proactively on leasing opportunities in order to maintain high levels of occupancy and address lease rollover risk, two, realize values on non-core properties in certain fully valued properties with a bias toward reducing our suburban office exposure, three, capitalize on refinancing opportunities and four, investment in build-to-suit properties and other accretive investment opportunities. We believe our company remains well-positioned with an attractive dividend yield and conservative payout ratio in the opportunity to continue to execute strategies which improve cash flow, enhance our portfolio and provide ongoing value creation for our shareholders. Operator, I have no further comment at this time. So we are ready for you to conduct the question-and-answer portion of the call. Question-and-Answer Session

(Operator Instructions). And we will take our first question from Sheila McGrath from Evercore Partners. Sheila McGrath – Evercore Partners: Yes, good morning. Wil, I was wondering if you could talk a little bit more about the guidance. If you look at fourth quarter and analyzed it would be about $1.12 but your guidance says a $1.11 to $1.15. So it seems little conservative. Could you give us an idea what’s in the assumption in terms of acquisition and is there any equity issuance in there that’s driving that lower?

No, there is no equity issuance in the model Sheila. We are looking to finance the pipeline with sale proceeds. One of the factors that will affect how the year plays out is the timing of sales versus reinvestment in new project. I think there is opportunity for us to revisit our guidance as the year progresses with a bias toward raising your guidance, but we do have something to execute in the meantime. But we are certainly running the company to try ourselves to that point as the year progresses. Sheila McGrath – Evercore Partners: And what kind of acquisition volumes are you thinking about in terms of target this year?

Roughly $300 million to $350 million is what we have either underway good visibility on right now. And it’s early in the year so that number can grow and that would be a factor in reducing guidance as well. Sheila McGrath – Evercore Partners: And does that include the forward commitment build-to-suit pipeline that’s already underway?

That does. Sheila McGrath – Evercore Partners: Okay. Then one other question. You mentioned $0.12 to $0.14 I think you said referring kind of leasing cost or CapEx. I was just wondering is that level in 2014, is that a level that you would consider more normalized or do you think that there is room to even move that lower going forward?

No. I think there is room for that number to move down. The last few years 2012 and 2013 were very heavy from an expenditure standpoint, but once the portfolio is an imbalance that we been striving for with long-term revenue and shorter lease revenue, and in our mind what should follow is probably having honestly from the elevated levels of capital expenditures, so in our mind the last couple of years, it has been about $50 million a year, I think we would like to think that we can get the portfolio down to more normalized run rate of more like $25 million. That won’t happen in 2014, but that’s what we are eye on longer term. Sheila McGrath – Evercore Partners: Okay, thank you.

And we will go next to Craig Mailman from KeyBanc Capital Markets. Craig Mailman – KeyBanc Capital Markets, Inc.: Good morning, guys. May be just one follow up on the disposition guidance here. Well, I think you said it’s going to be pretty close to match acquisition activities. Is that $100 million to $125 million of purchase or the $300 million to $350 million.

$300 to $350 Craig Mailman – KeyBanc Capital Markets, Inc.: Okay and about $100 million of that is sort of office product that you guys would like to sell.

Well, it’s almost entirely office or multi-tenant office. Little bit less than $100 million of it is empty or office grade but the balance will be single-tenant office and we’ve had very good traction and velocity on some of our multi-tenant buildings that are now leased up or on their way to being leased up 90% or so that tells an opportunity to sell the assets and values being created. Craig Mailman – KeyBanc Capital Markets, Inc.: Has the pullback in rate here in the early part of the year, that accelerate maybe you guys go beyond the 350 and kind pre-fund or you want to do as we had to 2014 or 2015 rather but or would you guys rather kind of keep the pace relatively matched to manage dilution.

I would say we are more focused on keeping the pace relatively matched. Now the interest rate environment is favorable right now, we I think from the financing standpoint we need to consider this year when we want to take out some of our forward debt maturities, but I think that later in the year need discussion. Craig Mailman – KeyBanc Capital Markets, Inc.: Okay and then just more broadly has the pullback in rate here had any effect on your talks with sellers for assets or is it just been sort of nonevent as people – I guess what are people’s expectations here is that rate can stay where they are kind of bracing and pricing in our future rate increases.

I think the expectation at least in our mind between buyers and sellers right now that we are in a stable rate environment. We obviously work through a very good spike in rate during the year last year that sort of distorted the market for six months or so that made it harder to make transactions work but I think the expectations that we are in pretty steady rate environment now. Craig Mailman – KeyBanc Capital Markets, Inc.: Great, thank you, guys.

And we will go next to Yasmine Kamaruddin from J. P. Morgan. Yasmine Kamaruddin – J. P. Morgan: All right, so for the first quarter our lease is spread to earn negative 10%. Would you expect in 2014?

Well, in our mind – we looked at sort of 2014 and 2015 together honestly because that’s really been the end of our significant exposure to above market rents primarily in office. We have said before the leasing spread can be negative 15% to 20%. Our expectation isn’t much change. I think what different is that we are so far through this process of marketing rents that now it sort have been in absolute dollars if we look at 2014 and 20115 in the magnitude of exposures sort of $4 million $6 million, which from a dollar standpoint isn’t a big deal, but we do expect to continue to have negative lease spreads on office rollover. In many cases that’s because we’ve had during the lease term substantial rent growth and rents are being reset to what they might have been at the beginning of the lease term. So we are still from that standpoint earning I think very good yield on our initial investment cost, but we do expect that leasing spreads will be negative into 2015. Yasmine Kamaruddin – J. P. Morgan: Okay, so we can expect the same 15% to 20% negative range?

Yes, but it will be sporadic. We just had a quarter where we had very strong same-store NOI growth for example. Now we have about half the portfolio with annual rent growth that will have mitigating impact against those roll down, but it won’t be consistent, it will – some quarters will be strong and others less strong. Yasmine Kamaruddin – J. P. Morgan: Okay, got it. And so for G&A there was path in the fourth quarter, what can we expect going forward for 2014-15?

I think this reduce the fourth quarter G&A and use it as a run rate. They might be little bit higher but it should be aligned. Yasmine Kamaruddin – J. P. Morgan: Okay, all right. Is there a reason why it is higher?

Compensation of management– management get compensated on share grants and the share grants that’s for the three years as opposed to five years in past. Yasmine Kamaruddin – J. P. Morgan: Okay, got it, all right, great. That’s it. Thank you.

And we will take our next question from John Guinee from Stifel. John Guinee – Stifel, Nicolaus & Co., Inc.: Oh, thank you. Apologize for the cold here, hey Pat you slid property leases in vacancy back to page 27, it took me about a week to find them, but thank you. I kind of look at there – I think we talked about this before, this business is very binary and either do really well in these lease renewals or its likely a vacancy, can you – it look to us like in 2014 and 2015 industrial is very manageable maybe about $4 million of cash NOI, but the office is about $39 million or $40 million of cash NOI, can you just roll through the assets in that would leases expire for office properties in 2014 and 2015 and give us some color is what you expect? Page 27, you got to look for it.

Yeah, I know John, I apologize for the delay, and I am getting to page 27 so just bear with me. If we look at this – John Guinee – Stifel, Nicolaus & Co., Inc.: We have this conversation on the next call.

On 2014, if you are looking at the rollover the building in Chicago is under contract for sale to sell for about $35 million, in Northchase in Houston, that’s one where we’ll have some vacancy. In Bridgewater, New Jersey, that’s the one where we took the write down off so our expectation is that we will have a vacancy at the end of next year. And it’s called Washington Spacelab that’s another one where right now we see move out. If I look – I am going further than that Frontier Corporation in Rochester have some discussions with us and might want about 40% of that building. The Aventus building outside Pittsburgh, we think we have a vacancy there but think it will be an asset that will be pretty easy to reposition, and the Nextel building in Hampton Virginia we think that will stay in. We do think the 2015 will be a better year from our retention standpoint but we have do some on watch list in particular the Federal-Mogul building in Southfield, Michigan, and the inventive systems building in Foxborough, Massachusetts. John Guinee – Stifel, Nicolaus & Co., Inc.: Great, thank you.

And we will go to now Todd Schneider from Wells Fargo. Todd Schneider – Wells Fargo: Hi, thanks guys. For this year next look like about 13% your leases rolled and just kind of incorporating the disposition comments. Are you looking at these as candidates for sale and may be just on a percentage basis what do you think – well on percentage basis what do you think you sell from that.

Well, we said what vacant and coming off lease in 2014 we think we addressed about half through sale, and one of the things that happening in the market right now may be is the trend or may be it is just happening us is we now have some fairly strong interest from users in purchasing vacancy, that’s in our mind a little bit different dynamic than what we saw year ago. So that’s our expectation that about half with what is vacant or coming off lease will be sold. Todd Schneider – Wells Fargo: Okay, that’s helpful. And just to get to the high end of guidance for this year does that assume fewer assets sales are not necessarily?

Not necessarily Todd Schneider – Wells Fargo: Okay, and Pat, what’s the current line balance and is there a drawdown in your term loan expected sometime soon just trying to gauge of what your sources and uses over the near term?

As of today, Todd, we have nothing outstanding on the line and the term loan was fully drawn and earlier this month so the $250 million term loans fully drawn and we have nothing outstanding on the line. Todd Schneider – Wells Fargo: And just to touch on the land acquisitions, would you add to this just kind of get gauging your appetite for further land lease investments and maybe what percentage of your pipeline represents land opportunity.

We would be interested in further long-term land purchases, and we are looking at one transaction but I think we totaled everything up it wouldn’t be more than – cannot not more than 30% of what we are looking at, 25% to 30%. Todd Schneider – Wells Fargo: Okay and just finally if you incorporate all the announced build-to-suit that are expected to be completed in as your pushing out your average lease duration, what do you think that looks like once incorporate asset sales as well? What do you think your average lease term looks like by the end of this year?

I mean it depends on to the acquisition that we do, mostly acquisition are longer term leases but when you have $ 5 billion portfolio, you buy through $ 50 million a year in the 20 years, it is difficult to move that needle up that significantly.

But I think there’s a good Todd that it can be pushed modestly longer this year. Todd Schneider – Wells Fargo: Great, thank you.

And we will take our next question from Tayo Okusanya from Jefferies.

Hey, good morning, guy. This is David Sean here with Tayo. I don’t know if I miss this but this $300 million -$350 million of investments you talked about what’s the split between acquisitions in build-to-suit?

Well we said that purchases would be $100 million to $125 million with the balance in deposit.

Okay and then just on the dispositions, you had mentioned in the past that you would like to sell your 100 Light Street assets in Baltimore, just wondering that’s on the table, I know that it is 95% lease and talked about selling more assets with vacancy, so just want your thoughts.

It is not in the pool of assets that we are flowing into the market right now to finance. The current pipeline of 2014 that we had visibility on but later in the year if acquisition volumes is greater than what we see now that’s an asset that we could consider looking at again. I think all the free rent period is burned off and most of our rents have annual escalators in them and the building is well financed. I’ve still got about nine years to ago on the financing at a fixed-rate 432 so that should be of value to the buyer. So that’s one that we have in our back pocket to consider monetizing later in the year.

That’s helpful. And then just looking big picture with all the recent M&A activity happening in a triple net space. That seems you guys could potentially be an ideal target for one of the big acquire so just hoping you can comment.

I couldn’t comment on that. We think it’s great that the sectors gotten so big and has so much investor attention, and we are very focused on executing our business plan to make our company more valuable for all kinds of investors.

Great, thanks a lot guys.

And we will take our next question; follow up question from Craig Mailman from KeyBanc Capital Markets. Craig Mailman – KeyBanc Capital Markets, Inc.: Thanks, guys. Just want to circle up on the shift to a larger portion of industrial, obviously as you become more desirable property type and we have seen kind of cap rate jut adjust accordingly in competition for assets increase, and I am just curious as you guys go out and look for build-to-suit opportunities, one, just how big that pool is today versus may 6 to 12 months ago, and can you talk just a little bit about what sellers are looking for in terms of pricing relative to 6 to 12 months ago?

Well, I think the industrial component of our forward pipeline in percentage terms is probably larger right now than that ever has been. They are definitely seems to be more activity in industrial than office for example. Industrial for us from a purchase standpoint is still priced that is extremely low cap rate that were not particularly interested in. We think on forward industrial build-to-suit, that cap rate as much of 100 basis points higher, but I think with what you’re seeing to get that yield premium you might be committing further forward than you might been a year ago, so there is – for sure compared to a year ago when cap rates were extremely low, may be there’s been about 50 basis point of upward movement I would say.

So on our industrial build-to-suit were still in our mind getting in the low seventh right now but in some cases we are committing further forward. Craig Mailman – KeyBanc Capital Markets, Inc.: Are you guys seeing increased competition from the industrial REIT or non-traded guys or anybody kind of wanting to get in to this business given further rent growth projections people have for industrial and are the developers looking to get more on the backend than they had been?

No, it is more competitive playing field than it was a year or two years ago. We actually think that the environment is better for us compared to when interest rates were so low. And interest rate moved up a lot that tends to honestly make builders more interested in locking in their profits versus being tempted to hold the project till the end and selling the property getting all the upside. So honestly a spike in interest rates makes it easier for us to lock in an attractive terms on build-to-suit. Craig Mailman – KeyBanc Capital Markets, Inc.: Great, thank you.

And we will go now to Dan Dangling [ph] from Liebenberg (indiscernible)

Thank you and good morning. Well, just looking at page 18, you give your credit rating, just curious if that investment grade 45%. Is that include implied investment grade or is that just what Moody or S&P one of rating agencies does?

Lot of rating agencies does.

Okay, so that unrated portion that you have – is any of that you think if you I mean some of your peers you like they did their own calculation and say certain percentage that has implied investment-grade rating with that ascribes you guys that 40% as unrated as well or–

We don’t do that. It does not over rating.

If they don’t have debt to rate the run, I think they are good credits in there obviously but no we don’t sit there and have shadow ratings.

And then well I wondered if you could comment on – the reasons for why some of your tenants did not renew and why some of the tenants that you talked about in 2014 will not renew its – is there any type of general trend, is it more these folks are consolidating into another building, is it that they are finding the building obsolete or –

It is not functional obsolescence really, continues to be the general downsizing in office use that we are seeing throughout the corporate America for the most part.

Okay and then anything about I mean in terms of rent or they finding rent elsewhere or better rent –

No, we never lose a tenant over rent. If anything were, we are the predatory landlord into the market, so it’s really been two companies who have used have four buildings and found out and figure out how to run the business with three, it’s more that than anything else.

Okay, thank you very much.

And we will take our final question from William Segal from Development Associate Incorporated. William Segal – Development Associate Incorporated: Thank you, great execution gentlemen. Curious, Wil, you mentioned how you want to enlarge the industrial to office ratio, your goals for other metrics, any particular geographical areas that you guys like or want to avoid either for managerial reasons, capital appreciation, hedging your portfolio. Is that entering into your decisions?

I mean it does. Certainly although we do try understand for whatever reason a corporation is building new in whatever market there is. So we are willing smaller market sometime, it doesn’t mean we’ll say no but we might require a 20 year lease term and then we might have a strategy to sell that asset before the lease is up, whether still 10 years of the terms to ago. So we are focused on being in market where there gap, but if there’s a good deal of opportunity in smaller market that doesn’t mean that will say no to it. But the broad trend for corporate location is towards business friendly environments and states that can afford relocate corporations for purposes of creating jobs and are our portfolio is migrating towards those areas steadily. William Segal – Development Associate Incorporated: Thank you, very much.

Okay, that does conclude today’s question-and-answer session. I’ll turn the conference back over to moderator for any additional comments or remarks.

I just want to follow up one of the question that we were asked about the G&A. I want to make sure we are clear. When I talked about the run rate I meant the 12 month December 2013 was a good run rate not an annual – of the fourth quarter. So the G&A that we had for the 12 months was about $29 million, I feel that sort of good run rate using the next year.

Great, well, thank you all again for joining us this morning. We are very excited about our prospects of the balance of this year beyond. And as always we appreciate your participation and support. If you would like to receive our quarterly supplemental package, please contact Gabriela Reyes or you can find additional information on the company on our website at www.lxp.com, in addition you may contact me for any the other members of our senior management team with any questions. Thanks again.

And that does conclude today’s conference. And we thank you for your participation.