Great Lakes REIT Announces First Quarter Leasing Activity and Other Matters

Business Wire, March 12, 2003

Business Editors

OAK BROOK, Ill.--(BUSINESS WIRE)--March 12, 2003

Great Lakes REIT (NYSE:GL), a real estate investment trust which owns a portfolio of Midwestern office properties, today confirmed that the Company expected to meet it leasing target for the first quarter.

"Leasing for the first quarter looks pretty good," said Dick May, Chairman and CEO. "Space showings for the first two-and-a-half months of 2003 have increased over the same period last year. Many of these showings have and should continue to result in signed leases. We expect to meet our leasing target for the first quarter of 2003. We will discuss the results in detail during our next quarterly earnings call. Recent speculation regarding our company has surprised me. We have worked hard over the years at being a transparent company with a long-term focus. Great Lakes REIT has sold 14 properties since it went public in 1997 and the average internal rate of return on those sales was 18.8% on an un-leveraged basis and 27.8% assuming 50% mortgage debt financing. Great Lakes REIT has published these results in each and every quarterly earnings release and is one of the only REITs to do so. Great Lakes REIT had $7.8 million in profits on sales in 2002, or about $0.47 per share. Many other companies include such sale gains in FFO but Great Lakes REIT does not. Future sales may not all achieve the same results as past sales, but success in real estate investing should be measured not only on a quarterly cash flow basis, but on the performance of each property over its entire life-cycle. We believe complete focus on the near-term is short-sighted."

As noted in previous releases, the employees of the Company, including senior officers are required under the requirements of the Sarbanes-Oxley Act to repay certain maturing loans extended previously. As noted in annual SEC filings, the Company's employee loan program was established in 1996 to promote share ownership by encouraging the exercise of stock options granted to the officers and employees during the period 1992-1998. These stock options represented the sole equity incentive provided to officers and employees at that time. Loans have never been granted for other purposes. The loans were granted to senior officers and other company employees at market interest rates (6.83%) and terms. As noted in the SEC filings required in connection with such sales, senior officers have sold 72,900 shares during 2003 to date. The proceeds of such sales have been used to retire employee loans. During 2003 to date, approximately $1.3 million in employee loans have been repaid and an additional $7.1 million in employee loans mature during 2003. During 2004, 2005 and 2006, $3.9 million, $3.5 million, and $300,000 of employee loans mature, respectively.

Great Lakes REIT is a fully integrated, self-administered and self-managed real estate investment trust. The current portfolio consists of 46 properties totaling approximately 6.0 million square feet of space in suburban areas of Chicago, Milwaukee, Detroit, Columbus, Minneapolis, Denver and Cincinnati.

This release contains forward-looking statements as defined by the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Statements in this document regarding the Company's expectation for portfolio leasing, common share selling by employees and the repayment of employee loans, are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on what the Company believes to be reasonable assumptions and management's current expectations; however, actual results may vary from those implied by such forward-looking statements. Key factors that may cause actual results to differ from projected results include changes in: interest rates; conditions in the financial markets generally and the market for real estate finance specifically; local and/or national economic conditions; the pace of office space development and sub-lease availability; tenant office space demand; the financial position of the Company's tenants, including changes that may lead to increases in tenant defaults; actual tenant default rates compared to anticipated default rates; and other risks inherent in the real estate business. For more information, refer to Great Lakes REIT's filings with the Securities and Exchange Commission.