LASALLE PARTNERS INC, S-1/A, 1997-07-03

LASALLE PARTNERS INC
S-1/A, 1997-07-03
SURETY INSURANCE

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<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 3, 1997

REGISTRATION NO. 333-25741
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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

AMENDMENT NO. 3
TO
FORM S-1
REGISTRATION STATEMENT

UNDER
THE SECURITIES ACT OF 1933

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

LASALLE PARTNERS INCORPORATED
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

MARYLAND 6531 36-4150422
(STATE OR OTHER (PRIMARY STANDARD (I.R.S. EMPLOYER
JURISDICTION OF INDUSTRIAL CLASSIFICATION IDENTIFICATION NO.)
INCORPORATION OR CODE NUMBER)
ORGANIZATION)

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

200 EAST RANDOLPH DRIVE
CHICAGO, ILLINOIS 60601
(312) 782-5800
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)

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

WILLIAM E. SULLIVAN
EXECUTIVE VICE PRESIDENT
LASALLE PARTNERS INCORPORATED
200 EAST RANDOLPH DRIVE
CHICAGO, ILLINOIS 60601
(312) 782-5800
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)

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

WITH COPIES TO:

CHARLES W. MULANEY, JR., ESQ. THOMAS A. COLE, ESQ.
RODD M. SCHREIBER, ESQ. SIDLEY & AUSTIN
SKADDEN, ARPS, SLATE, MEAGHER & FLOM ONE FIRST NATIONAL PLAZA
(ILLINOIS) CHICAGO, ILLINOIS 60603
333 WEST WACKER DRIVE, SUITE 2100 (312) 853-7000
CHICAGO, ILLINOIS 60606
(312) 407-0700

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

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement becomes effective.

If any of the securities being registered on this form are to be offered on
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [_]

If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]

If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]

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

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE
REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES
AND EXCHANGE COMMISSION, ACTING PURSUANT TO SECTION 8(A), MAY DETERMINE.

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- -------------------------------------------------------------------------------
<PAGE>

EXPLANATORY NOTE

This registration statement contains two forms of prospectus: one to be used
in connection with a United States offering (the "U.S. Prospectus") and one to
be used in connection with a concurrent international offering (the
"International Prospectus"). The U.S. Prospectus and the International
Prospectus are identical except that they contain different front cover pages.
The form of U.S. Prospectus is included herein and the front cover page of the
International Prospectus which is labeled "International Cover Page" follows
the back cover page for the U.S. Prospectus.
<PAGE>

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
PROSPECTUS (Subject to Completion)

Issued July 3, 1997

4,000,000 Shares
LOGO
COMMON STOCK

-----------

ALL OF THE 4,000,000 SHARES OF COMMON STOCK OFFERED HEREBY ARE BEING SOLD BY
THE COMPANY. OF THE 4,000,000 SHARES OF COMMON STOCK BEING OFFERED,
3,200,000 SHARES ARE BEING OFFERED INITIALLY IN THE UNITED STATES AND
CANADA BY THE U.S. UNDERWRITERS AND 800,000 SHARES ARE BEING OFFERED
INITIALLY OUTSIDE OF THE UNITED STATES AND CANADA BY THE
INTERNATIONAL UNDERWRITERS. SEE "UNDERWRITERS." PRIOR TO THIS
OFFERING, THERE HAS BEEN NO PUBLIC MARKET FOR THE COMMON STOCK OF
THE COMPANY. IT IS CURRENTLY ESTIMATED THAT THE INITIAL
OFFERING PRICE PER SHARE OF COMMON STOCK WILL BE BETWEEN $19
AND $21. SEE "UNDERWRITERS" FOR A DISCUSSION OF THE FACTORS
TO BE CONSIDERED IN DETERMINING THE INITIAL PUBLIC
OFFERING PRICE.

-----------

APPLICATION HAS BEEN MADE TO LIST THE COMMON STOCK ON THE NEW YORK STOCK
EXCHANGE UNDER THE SYMBOL "LAP."

-----------

SEE "RISK FACTORS" BEGINNING ON PAGE 10 OF THIS PROSPECTUS FOR
INFORMATION THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.

-----------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

-----------
PRICE $ A SHARE
-----------

<TABLE>
<CAPTION>
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC COMMISSIONS(1) COMPANY(2)
-------- ------------- -----------
<S> <C> <C> <C>
Per Share................................. $ $ $
Total(3).................................. $ $ $
</TABLE>
- -----
(1) The Company and the Selling Stockholder have agreed to indemnify the
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, as amended. See "Underwriters."
(2) Before deducting expenses of the Offering payable by the Company,
estimated at $2,000,000.
(3) The Selling Stockholder has granted to the U.S. Underwriters an option,
exercisable within 30 days of the date hereof, to purchase up to an
aggregate of 600,000 additional shares of Common Stock at the price to
public, less underwriting discounts and commissions, for the purpose of
covering over-allotments, if any. If the U.S. Underwriters exercise such
option in full, the total price to public, underwriting discounts and
commissions, and proceeds to the Selling Stockholder will be $ ,
$ and $ , respectively. The Company will not receive any proceeds
from the exercise of the over-allotment option. See "Underwriters."

-----------

The Shares are offered, subject to prior sale, when, as and if accepted by
the Underwriters named herein and subject to approval of certain legal matters
by Sidley & Austin, counsel for the Underwriters. It is expected that the
delivery of the Shares will be made on or about , 1997 at the offices of
Morgan Stanley & Co. Incorporated, New York, N.Y., against payment therefor in
immediately available funds.

-----------

MORGAN STANLEY DEAN WITTER

WILLIAM BLAIR & COMPANY

MONTGOMERY SECURITIES

, 1997
<PAGE>

[Inside Front Cover]
Diagram depicting organizational structure and representative clients.

CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK.
SPECIFICALLY, THE UNDERWRITERS MAY OVER-ALLOT IN CONNECTION WITH THE OFFERING,
AND MAY BID FOR AND PURCHASE SHARES OF THE COMMON STOCK IN THE OPEN MARKET.
FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITERS."

2
<PAGE>

[Inside Front Cover Foldout]
Map of United States depicting locations of
principal offices of LaSalle Partners Incorporated and
pictures of buildings for which the
Company provides management services,
corporate and financial services and
investment management services.
<PAGE>

NO PERSON IS AUTHORIZED IN CONNECTION WITH ANY OFFERING MADE HEREBY TO GIVE
ANY INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN AS CONTAINED IN THIS
PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR BY ANY UNDERWRITER.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY BY ANY PERSON IN ANY
JURISDICTION IN WHICH IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL
UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED
HEREIN IS CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE HEREOF.

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

UNTIL , 1997 (25 DAYS AFTER THE COMMENCEMENT OF THIS OFFERING),
ALL DEALERS EFFECTING TRANSACTIONS IN THE COMMON STOCK, WHETHER OR NOT
PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS.
THIS DELIVERY REQUIREMENT IS IN ADDITION TO THE OBLIGATION OF DEALERS TO
DELIVER A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO UNSOLD
ALLOTMENTS OR SUBSCRIPTIONS.

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

For investors outside of the United States: No action has been or will be
taken in any jurisdiction by the Company or any Underwriter that would permit
a public offering of the Common Stock or possession or distribution of this
Prospectus in any jurisdiction where action for that purpose is required,
other than in the United States. Persons into whose possession this Prospectus
comes are required by the Company and the Underwriters to inform themselves
about and to observe any restrictions as to the offering of the Common Stock
and the distribution of this Prospectus.

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

In this Prospectus references to "dollar" and "$" are to United States
dollars, and the term "United States" or "U.S." means the United States of
America, its states, its territories, its possessions and all areas subject to
its jurisdiction.

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

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Prospectus Summary................ 4
Risk Factors...................... 10
Background of the Company......... 16
Incorporation Transactions........ 17
Use of Proceeds................... 18
Dividend Policy................... 18
Capitalization.................... 19
Dilution.......................... 20
Selected Financial Data........... 21
Pro Forma Consolidated Financial
Statements....................... 23
Management's Discussion and
Analysis of Financial Condition
and Results of Operations........ 26
</TABLE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Business........................... 41
Management......................... 55
Principal and Selling Stockholders. 61
Certain Relationships and Related
Transactions...................... 63
Description of Capital Stock....... 64
Shares Eligible for Future Sale.... 68
Certain U.S. Federal Tax
Considerations for Non-U.S.
Holders of Common Stock........... 70
Underwriters....................... 73
Legal Matters...................... 77
Experts............................ 77
Additional Information............. 77
Index to Financial Statements...... F-1
</TABLE>

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

The Company intends to furnish to its stockholders annual reports containing
consolidated financial statements audited by an independent public accounting
firm and quarterly reports for the first three quarters of each fiscal year
containing interim unaudited financial information.

3
<PAGE>

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the more detailed
information and financial statements and notes thereto appearing elsewhere
herein, including information under the heading "Risk Factors." Unless
otherwise indicated, all information in this Prospectus: (i) assumes no
exercise of the Underwriters' over-allotment option; (ii) reflects the
contribution of all of the partnership interests in LaSalle Partners Limited
Partnership ("LPL") and LaSalle Partners Management Limited Partnership
(together with LPL, the "Predecessor Partnerships") to the Company (the
"Contribution"), which will be completed immediately prior to the closing of
the offering of the Company's Common Stock (the "Offering"), and (iii) reflects
the amendment and restatement of the Company's Articles of Incorporation
immediately prior to the closing of the Offering. Following the Contribution,
the operations of the Predecessor Partnerships will be contributed to
subsidiaries of the Company as described under the caption "Incorporation
Transactions." Throughout this Prospectus, except where the context otherwise
requires, references to the "Company" or "LaSalle Partners" mean the
Predecessor Partnerships, including The Galbreath Company ("Galbreath") from
and after the merger of Galbreath with the Predecessor Partnerships, and their
subsidiaries as of and for the periods prior to the closing of the Offering
and, thereafter, collectively LaSalle Partners Incorporated and its
subsidiaries. See "Incorporation Transactions."

THE COMPANY

COMPANY OVERVIEW

LaSalle Partners is a leading full-service real estate firm that provides
management services, corporate and financial services and investment management
services to corporations and other real estate owners, users and investors
worldwide. By offering a broad range of real estate products and services, and
through its extensive knowledge of domestic and international real estate
markets, the Company is able to serve as a single source provider of solutions
for its clients' full range of real estate needs. Based on published industry
data and its industry knowledge, the Company believes that it holds a leading
market position in each of its primary businesses. For example, the Company
believes it is the largest property manager of office buildings in the United
States, one of the largest outsource service providers for corporate occupied
facilities and the third largest manager of institutional equity capital
invested in domestic real estate assets and securities. The Company is also the
fourth largest manager of institutional real estate equity investments in the
United Kingdom. Founded in 1968, the Company is headquartered in Chicago,
Illinois, and maintains corporate offices in 10 United States cities and four
international markets. The Company also maintains over 300 property and other
offices throughout the United States. In 1996, the Company generated total
revenue of $176.0 million, representing an increase of 15.9% from the prior
year's results.

On April 22, 1997, Galbreath, a property management, facility management and
development management company, merged with LaSalle Partners. Based on the 1996
Commercial Property News survey of property managers (the "1996 CPN Survey"),
the combination of Galbreath and the Company would have ranked the Company as
the third largest property manager in the United States. The Company's
principal objectives for the merger were to expand the Company's geographic
presence, add additional client relationships and provide the potential for
significant economic synergies with the Company's Management Services group. As
a result of the merger, the Company assumed management responsibility for an
additional 71 million square feet of commercial space.

COMPETITIVE ADVANTAGES

The Company believes that it has several competitive advantages which have
established it as a leader in the real estate services and investment
management industries. These advantages include the Company's:

4
<PAGE>

was derived from clients for which the Company provided services in prior
years. The Company's relationship orientation is supported by an employee
compensation system which it believes is unique in the real estate
industry. LaSalle Partners compensates its professionals with a salary,
bonus and stock ownership plan which is designed to reward client
relationship building, teamwork and quality performance, rather than on a
commission basis which is typical in the industry.

. Full Range of Services. By offering a wide range of high quality,
complementary services, the Company can combine its services to develop
and implement real estate strategies that meet the increasingly complex
needs of its clients. The Company's product and service capabilities
include property management and leasing, facility management, development
management, tenant representation, investment banking, land acquisition
and development, and investment management.

. Geographic Reach. With 10 corporate offices and over 300 property and
other offices throughout the United States, LaSalle Partners possesses
in-depth knowledge of local markets and can provide its full range of
real estate services throughout the country. In addition, the Company's
four international offices give the Company the ability to serve its
clients' needs in key international markets. The international offices
also serve as the platform from which the Company will expand its
international presence.

. Reputation. Based on its industry experience and number of long-standing
client relationships, the Company believes that it is widely recognized
by large corporations and institutional owners and users of real estate
as a provider of high quality, professional real estate services and
investment management products. The Company believes its name recognition
and reputation for quality services are significant advantages when
pursuing new business opportunities.

. Experienced Management/Employee Equity Incentives. The Company's senior
management team has an average of approximately 18 years of experience in
the real estate services industry and, with the exception of Lizanne
Galbreath who joined the Company on April 22, 1997 in connection with the
Galbreath merger, has been with LaSalle Partners for an average of
approximately 16 years. The Company uses equity-based incentive
compensation and bonus plans and minimum stock ownership guidelines to
foster employee commitment and align employee and stockholder interests.
Immediately following the Offering, the Company's senior management team
will indirectly own approximately 21.4% of the outstanding Common Stock
and total employee ownership will be approximately 47.5%.

BUSINESS

Management Services. The Company's Management Services group develops and
implements property level strategies to increase investment value for real
estate owners and optimize occupancy costs for corporate owners and users of
real estate. The Management Services group provides three primary service
capabilities: (i) property management and leasing for property owners; (ii)
facility management for properties occupied by corporate owners and users; and
(iii) development management for both investors and real estate users seeking
to develop new buildings or renovate existing facilities. As of March 31, 1997,
the Management Services group had property management, leasing or facility
management responsibility for approximately 132.7 million square feet of
commercial space.

Corporate and Financial Services. The Company's Corporate and Financial
Services group provides transaction and advisory services through three primary
service capabilities: (i) tenant representation for corporations and
professional service firms; (ii) investment banking services to address the
financing, acquisition and disposition needs of real estate owners; and (iii)
land acquisition and development services for owners, users and developers of
land. The Corporate and Financial Services group executed over 250 tenant
representation assignments in 1996, representing approximately seven million
square feet, and completed institutional property sales, debt and equity
financings and portfolio advisory activities on assets and portfolios valued at
approximately $4.9 billion.

5
<PAGE>

Investment Management. The Company's Investment Management group provides
real estate investment management services to institutional investors,
corporations and high net worth individuals. The Company offers its clients a
broad range of private investments (i.e., purchases of real estate assets) and
public investments such as real estate investment trusts ("REITs") and
commercial mortgage-backed securities ("CMBS"). Private real estate investments
have been made on a direct basis and through fund investments in portfolios of
assets. Investments in public REITs and CMBS are generally managed through
investment funds or client-specific portfolios. As of March 31, 1997, the
Company had approximately $15.1 billion of real estate assets under management,
of which approximately $2.5 billion consisted of public real estate securities.

GROWTH STRATEGY

The Company is pursuing a growth strategy which capitalizes on existing
client relationships and emerging industry trends. Key components of its growth
strategy include:

. Expanding Client Relationships. The Company intends to utilize its broad
real estate services capabilities to increase the range of services
provided to existing clients as well as to develop new client
relationships.

. Broadening International Presence. The Company intends to grow its
existing international operations and enter new markets to meet the
increasingly global needs of its clients.

. Selectively Pursuing Strategic Acquisitions. As the industry
consolidation among real estate service providers continues, the Company
intends to selectively pursue strategic acquisitions which expand the
Company's product and service offerings and geographic presence and which
provide the opportunity for economies of scale.

. Pursuing Co-investment Opportunities. The Company intends to accelerate
its strategy of co-investing with its investment management clients to
take advantage of recovering real estate markets. This strategy is
intended to increase the growth of assets under management, generate
return on investment and create potential opportunities to provide
services related to the acquisition, financing, property management,
leasing and disposition of such investments.

INCORPORATION TRANSACTIONS

The Company and LaSalle Partners Management Services, Inc. ("LPMS"), LaSalle
Partners Corporate & Financial Services, Inc. ("LCFS") and LaSalle Advisors
Capital Management, Inc. ("LACM") were formed in April 1997 in connection with
the conversion of the business and operations of the Predecessor Partnerships
from partnership to corporate form. Immediately prior to the closing of the
Offering, the general and limited partners of the Predecessor Partnerships will
exchange their partnership interests in the Predecessor Partnerships for
12,200,000 shares of Common Stock, and the Company will succeed to the business
and operations of the Predecessor Partnerships. Prior to the exchange, neither
the Company, LPMS, LCFS nor LACM had any assets or conducted any operations
other than in connection with their formation.

Following the exchange, the Company will operate as a holding company with
the business and operations of the Predecessor Partnerships being conducted
through four principal wholly-owned operating subsidiaries, LPMS, LCFS, LACM
and LaSalle Partners International, Inc. ("LPII" and, collectively with LPMS,
LCFS and LACM, the "Principal Operating Subsidiaries"). LPII, an existing
subsidiary of the Predecessor Partnerships, will continue to conduct the
Company's international operations. The Predecessor Partnerships are
undertaking these transactions in order to facilitate access to the capital
markets, provide greater flexibility for acquisitions, create longer-term
liquidity for their partners and reduce administrative burdens associated with
operating as a partnership. See "Incorporation Transactions."

6
<PAGE>

THE OFFERING

<TABLE>
<C> <S>
Common Stock offered:
U.S. offering.................................... 3,200,000 shares
International offering........................... 800,000 shares
Total Common Stock offered....................... 4,000,000 shares
Common Stock to be outstanding after the Offering. 16,200,000 shares (1)
Use of proceeds................................... To repay certain
outstanding indebtedness of
the Company and for general
corporate purposes. See
"Use of Proceeds."
Proposed New York Stock Exchange symbol........... LAP
</TABLE>
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(1) Excludes an aggregate of: (i) 725,000 shares of Common Stock issuable upon
exercise of options to be granted under the Company's 1997 Stock Award and
Incentive Plan ("1997 Stock Incentive Plan") upon closing of the Offering,
with an exercise price equal to the initial public offering price; and (ii)
1,490,000 additional shares of Common Stock reserved for future grants or
awards under the Company's 1997 Stock Incentive Plan. See "Management--
Director Compensation" and "--1997 Stock Award and Incentive Plan."

RISK FACTORS

Prospective investors should carefully consider the matters discussed under
"Risk Factors" prior to making an investment decision regarding the Common
Stock offered hereby. These matters include, among others: (i) the impact of
general economic conditions and the real estate economic climate on the
Company's business and results of operations; (ii) the risk that property
management and investment management agreements will be terminated prior to
expiration or not renewed; (iii) the dependence of the Company's revenue from
property management and leasing services on the performance of the properties
managed by the Company; (iv) the risks inherent in pursuing a selective
acquisition strategy; (v) the concentration of the Company's properties in
central business districts; (vi) the risks associated with the co-investment
activities of the Company; (vii) the seasonal nature of the Company's revenue,
operating income and net earnings; and (viii) the competition faced by the
Company in a variety of business disciplines within the commercial real estate
industry. See "Risk Factors."

7
<PAGE>

SUMMARY FINANCIAL DATA

The information set forth below should be read in conjunction with "Pro Forma
Consolidated Financial Statements," "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and the Predecessor
Partnerships' Combined Financial Statements and notes thereto, all included
elsewhere herein.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------------
1996
PRO FORMA AS
1992 1993 1994 1995 1996 ADJUSTED (1)
---------- ---------- ----------- ----------- ----------- ------------
(IN THOUSANDS, EXCEPT SHARE DATA)
<S> <C> <C> <C> <C> <C> <C>
STATEMENT OF
OPERATIONS DATA:
Total revenue.... $ 103,334 $ 104,049 $ 126,918 $ 151,827 $ 175,967 $ 207,559
Total operating
expenses........ 84,722 87,036 108,903 131,711 149,066 177,382
---------- ---------- ----------- ----------- ----------- -----------
Operating income
(loss).......... 18,612 17,013 18,015 20,116 26,901 30,177
Interest expense. 5,590 5,257 5,159 3,806 5,730 1,075
Earnings (loss)
before provision
for income
taxes........... 13,022 11,756 12,856 16,310 21,171 29,102
Net provision
(benefit) for
income taxes.... 355 300 554 505 1,207 11,204
---------- ---------- ----------- ----------- ----------- -----------
Net earnings
(loss).......... $ 12,667 $ 11,456 $ 12,302 $ 15,805 $ 19,964 $ 17,898
========== ========== =========== =========== =========== ===========
Pro forma:
Supplemental
primary and
fully diluted
earnings (loss)
per share(2)... $1.13
===========
OTHER DATA:
EBITDA(3)........ $ 21,034 $ 19,544 $ 20,866 $ 24,356 $ 32,317 $ 37,624
Cash flows
provided by
(used in)
operating
activities...... 14,675 4,837 24,628 13,553 13,964 13,646
Cash flows
provided by
(used in)
investing
activities...... (1,727) (2,738) (4,885) (5,706) (32,478) (31,852)
Cash flows
provided by
(used in)
financing
activities...... (19,000) (6,758) (12,028) (12,365) 17,189 19,195
Investments under
management(4)... $6,500,000 $7,000,000 $10,700,000 $11,500,000 $15,200,000 $15,200,000
Total square
feet-facility
management(5)... 2,400 50,600 50,600 67,600 68,600 81,600
Total square feet
under
management(6)... 47,000 98,300 102,400 125,700 131,600 202,900
<CAPTION>
THREE MONTHS ENDED MARCH 31,
---------------------------------------
1997
PRO FORMA AS
1996 1997 ADJUSTED (1)
------------ ------------ -------------
<S> <C> <C> <C>
STATEMENT OF
OPERATIONS DATA:
Total revenue.... $ 27,285 $ 36,019 $ 43,384
Total operating
expenses........ 32,490 39,291 46,269
------------ ------------ -------------
Operating income
(loss).......... (5,205) (3,272) (2,885)
Interest expense. 937 1,695 265
Earnings (loss)
before provision
for income
taxes........... (6,142) (4,967) (3,150)
Net provision
(benefit) for
income taxes.... (350) (248) (1,213)
------------ ------------ -------------
Net earnings
(loss).......... $ (5,792) $ (4,719) $ (1,937)
============ ============ =============
Pro forma:
Supplemental
primary and
fully diluted
earnings (loss)
per share(2)... $(0.12)
=============
OTHER DATA:
EBITDA(3)........ $ (4,094) $ (1,498) $ (599)
Cash flows
provided by
(used in)
operating
activities...... (12,721) (4,678) (7,892)
Cash flows
provided by
(used in)
investing
activities...... (5,967) (2,038) (2,185)
Cash flows
provided by
(used in)
financing
activities...... 14,921 7,705 7,573
Investments under
management(4)... $11,500,000 $15,100,000 $15,100,000
Total square
feet-facility
management(5)... 67,600 69,100 82,100
Total square feet
under
management(6)... 130,200 132,700 204,000
</TABLE>

<TABLE>
<CAPTION>
MARCH 31, 1997
-----------------------
PRO FORMA
ACTUAL AS ADJUSTED(7)
-------- --------------
(IN THOUSANDS)
<S> <C> <C>
BALANCE SHEET DATA:
Cash and cash equivalents............................... $ 8,094 $ 14,994
Total assets............................................ 124,075 166,411
Long-term debt(8)....................................... 57,083 --
Total liabilities....................................... 109,425 50,575
Partners' capital/stockholders' equity.................. 14,650 115,836
</TABLE>
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(Footnotes on following page)

8
<PAGE>

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(1) As adjusted to give effect to the merger of Galbreath with the Company, the
Incorporation Transactions and the sale of the shares of Common Stock
offered by the Company hereby at an assumed initial public offering price
of $20.00 per share and the receipt and application of the net proceeds
therefrom to retire debt, as though they had occurred on January 1, 1996.
See "Use of Proceeds," "Background of the Company" and "Incorporation
Transactions."

(2) Pro forma as adjusted supplemental primary and fully diluted earnings
(loss) per share is based upon 15,869,337 shares of Common Stock
outstanding, which includes the 12,200,000 shares of Common Stock to be
issued in connection with the Incorporation Transactions and gives effect
to 3,669,337 of the 4,000,000 shares of Common Stock to be issued in the
Offering, the proceeds of which will be used to repay indebtedness. The
Company will have 16,200,000 shares of Common Stock outstanding upon
completion of the Offering. See "Use of Proceeds."

(3) EBITDA represents earnings before interest, income taxes, depreciation and
amortization, thereby removing the effect of certain non-cash charges on
income, such as the amortization of intangible assets relating to
acquisitions. Management believes that EBITDA is useful to investors
because it is widely used in the real estate industry as a recognized
measure of operating performance, cash generation and ability to service
debt and is also used by analysts who report publicly on the performance of
real estate services companies. However, EBITDA should not be considered as
an alternative either to: (i) net earnings (determined in accordance with
generally accepted accounting principles ("GAAP")); (ii) operating cash
flow (determined in accordance with GAAP); or (iii) liquidity. There can be
no assurance that the Company's calculation of EBITDA is comparable to
similarly titled items reported by other companies.
(4) Investments under management represents the aggregate fair market value or
cost basis of assets managed by the Investment Management group as of the
end of the periods shown. The percentage of investments under management
stated at cost represented 3% in 1992 and 1993, 7% in 1994 and 1995, and 8%
in 1996 and 1997 of the amounts shown.
(5) Represents the total square footage of properties for which the Company
provided facility management services as of the end of the periods shown.
(6) Represents the total square footage of properties for which the Company
provided property management and leasing or facility management services as
of the end of the periods shown.

(7) As adjusted to give effect to the merger of Galbreath with the Company, the
Incorporation Transactions and the sale of the shares of Common Stock
offered by the Company hereby at an assumed initial public offering price
of $20.00 per share and the receipt and application of the net proceeds
therefrom to retire debt, as though they had occurred on March 31, 1997.
See "Use of Proceeds," "Background of the Company" and "Incorporation
Transactions."
(8) See Note 7 to Notes to the Predecessor Partnerships' Combined Financial
Statements.

9
<PAGE>

RISK FACTORS

Prospective investors should carefully consider the following information in
addition to the other information presented in this Prospectus before
purchasing the shares of Common Stock offered hereby.

GENERAL ECONOMIC CONDITIONS; REAL ESTATE ECONOMIC CLIMATE

Periods of economic slowdown or recession, rising interest rates or
declining demand for real estate could adversely affect certain segments of
the Company's business. Such economic conditions could result in a general
decline in rents which in turn would adversely affect revenue from property
management fees (which in certain cases are calculated as a percentage of the
revenue generated by the property under management) and commissions or fees
derived from property sales and leases (which are typically based on the sale
price or lease revenue commitment, respectively). Such conditions could also
lead to a decline in sale prices as well as a decline in demand for capital
invested in commercial real estate and related assets.

The condition of the real estate market tends to be cyclical and related to
the condition of the economy as a whole or, at least, to the perceptions of
investors and users as to the economic outlook. The sharp downturn in the
commercial real estate market in the early 1990s has caused and may continue
to cause some property owners to dispose of their properties or to lose them
through foreclosures. Such changes in the ownership of properties may be
accompanied by a change in property and investment management firms and could
cause the Company to lose property and investment management agreements or
make the agreements it retains less profitable.

RISK OF TERMINATION OR OTHER LOSS OF MANAGEMENT AGREEMENTS

The Company is substantially dependent on revenue received for services
performed under property management and leasing and investment management
agreements, and would be adversely affected if a significant number of these
agreements were terminated or were not renewed. For the year ended December
31, 1996, revenue from property management and leasing agreements and
investment management agreements constituted approximately 37% and 32%,
respectively, of total revenue. Most property management and leasing and
investment management agreements have terms of approximately three years and
typically are terminable by the client for any reason on as little as 30 to 60
days' notice. There can be no assurance that any such contracts will not be
cancelled prior to expiration or will be renewed when the term expires. In
addition, the Company derives substantial property management and leasing and
investment banking fees from real estate assets managed by its Investment
Management group. Contracts for these related services may be terminated or
lost for a number of reasons, including the termination or cancellation of the
underlying asset management agreement or disposition of the subject property.
The loss of a substantial number of these agreements could have a material
adverse effect on the Company.

In addition, the Company will sell the remaining real estate assets held by
four multiple investor funds ("commingled funds") formed by the Company in the
1980s to hold real estate investments on behalf of numerous tax-exempt
institutional investors. The Company receives investment advisory, property
management and leasing and investment banking fees for services provided in
connection with these funds. In 1996, 1995 and 1994, revenue derived from, or
in connection with, these funds represented 11.5%, 12.8% and 20.1%,
respectively, of the Company's total revenue. The Company expects that revenue
derived from, or in connection with, these funds will decrease and eventually
be eliminated as the remaining assets of the funds are sold. While the timing
of the revenue losses will depend on the timing of the dispositions, the
Company expects to complete substantially all of such dispositions prior to
the end of 1998. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations."

DEPENDENCE ON PROPERTY PERFORMANCE

The Company's revenue from property management and leasing services are
generally based on percentages of the revenue generated by the properties that
it manages. In addition, leasing commissions typically are based

10
<PAGE>

on the value of the lease revenue commitments. Accordingly, the continued
success of the Company will be dependent, in part, upon the performance of the
properties it manages. Such performance in turn will depend in part upon the
ability of the Company to attract and retain creditworthy tenants for the
properties it manages, the Company's ability to control operating expenses
(some of which are beyond the Company's control), financial conditions
prevailing generally and in the areas in which such properties are located and
the real estate market generally.

RISKS INHERENT IN PURSUING SELECTIVE ACQUISITION STRATEGY

The Company intends to continue to selectively pursue domestic and
international acquisitions as a means of strengthening its position as an
industry leader, as well as expanding and enhancing its current product and
service offerings and geographic market coverage. The success of the Company's
acquisition strategy will be dependent upon the availability of suitable
acquisition candidates on favorable terms, of which there can be no assurance.
Further, there can be no assurance that any acquisition, including the merger
of Galbreath with the Company, will be integrated successfully into the
Company's operations or will perform in accordance with expectations or that
business judgements as to the value or consequences of any such acquisition
will prove correct. The consideration paid for any future acquisition may be
in cash, debt or shares of the Company's capital stock. The Company could
incur substantial indebtedness or substantial goodwill or both in connection
with its acquisition strategy. In addition, issuances of additional shares of
the Company's capital stock in connection with an acquisition could result in
dilution to stockholders.

CONCENTRATION OF PROPERTIES IN CENTRAL BUSINESS DISTRICTS

Many of the properties for which the Company provides management and leasing
or investment management services are office buildings in the central business
districts ("CBDs") of major urban cities. Approximately 39% of the 132.7
million square feet under the Company's property, leasing and facility
management agreements, and approximately 36% of the $12.6 billion in private
real estate assets under the Company's investment management agreements as of
March 31, 1997, are related to properties located in CBDs. During the early
1990s, rental rates and property values of CBD office buildings experienced
greater declines relative to other property types and locations. This decline,
and the slower recovery of this sector to date, has been largely attributable
to over-supply of new office space and corporate restructurings affecting
large businesses. The cyclical market conditions of the CBD office sector will
continue to have an important impact on the Company's operations.

RISKS ASSOCIATED WITH CO-INVESTMENT ACTIVITIES

The Company intends to use the increased financial flexibility created by
the Offering to expand its co-investment activities. The Company's increased
participation as a principal in real estate investments could increase
fluctuations in the Company's net earnings and cash flow. The Company's co-
investments also inherently involve the risk of loss of the Company's
investment. Moreover, in certain of these investments, the Company will not
have complete discretion to control the timing of the disposition of such
investments and, as a result, the recognition of any related gain or loss. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."

SEASONALITY

Historically, the Company's revenue, operating income and net earnings in
the first three calendar quarters are substantially lower than in the fourth
quarter. This seasonality is due to a calendar year-end focus on the
completion of transactions, which is consistent with the real estate industry
generally. In addition, an increasing percentage of the Company's management
contracts contain clauses providing for performance bonuses to be received if
the Company achieves certain performance targets. Such incentive payments are
generally earned in the fourth quarter. In contrast, the Company's non-
variable operating expenses, which are treated as expenses when incurred
during the year, are relatively constant on a quarterly basis. Therefore, the
Company typically sustains a loss in the first and second quarter of each
calendar year, reports a small profit or loss in the third quarter and records
a substantial majority of the Company's earnings in the fourth calendar
quarter. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations--Quarterly Results of Operations."

11
<PAGE>

COMPETITION

The Company competes in a variety of business disciplines within the
commercial real estate industry, including investment management, tenant
representation, corporate facility management, construction and development
management, on-site property management and leasing, and investment banking.
Each of these business disciplines is highly competitive on a national as well
as local level. Depending on the industry segment, the Company faces
competition from other real estate service providers, institutional lenders,
insurance companies, investment banking firms, investment managers and
accounting firms. Some of the Company's principal competitors in certain of
these business disciplines have greater financial resources and a broader
global presence. Many of the Company's competitors are local or regional firms
which are substantially smaller than the Company on an overall basis; however,
they may be substantially larger on a local or regional basis. The Company has
faced increased competition in recent years in the Management Services and
Investment Management segments of its business which has, in some cases,
resulted in lower property and investment management fees, or compensation
arrangements more closely aligned with performance. In recent years, there has
also been a significant increase in the number of REITs which self-manage
their real estate assets, which could decrease the demand for property
management services, and thereby increase competition. In general, with
respect to each of the Company's business disciplines, there can be no
assurance that the Company will be able to continue to compete effectively,
will be able to maintain current fee or margin levels or arrangements or will
not encounter increased competition.

RISK RELATED TO GENERAL PARTNER STATUS

Subsidiaries of the Company are general partners in numerous general and
limited partnerships which invest in or manage real estate assets. As a
general partner, these subsidiaries may be liable to their partners as well as
liable for the obligations of such partnerships. Because all of the Company's
general partnership interests are held through its special purpose
subsidiaries, the Company believes that its exposure to contingent liabilities
is limited to the total invested or committed capital in and notes from or
advances to such subsidiaries holding the general partnership interests.

ENVIRONMENTAL CONCERNS

Various federal, state and local laws and regulations impose liability on
current or previous real property owners or operators for the cost of
investigating, cleaning up or removing contamination caused by hazardous or
toxic substances at the property. In the Company's role as an on-site property
manager, it could be held liable as an operator for such costs. Such liability
may be imposed without regard to legality of the original actions and without
regard to whether the Company knew of, or was responsible for, the presence of
such hazardous or toxic substances, and such liability may be joint and
several with other parties. If the liability is joint and several, the Company
could be responsible for payment of the full amount of the liability, whether
or not any other responsible party is also liable. Further, any failure of the
Company to disclose environmental issues could subject the Company to
liability to a buyer or lessee of property. In addition, some environmental
laws create a lien on the contaminated site in favor of the government for
damages and costs it incurs in connection with the contamination. The operator
of a site may be liable under common law to third parties for damages and
injuries resulting from environmental contamination emanating from the site,
including the presence of asbestos-containing materials. There can be no
assurance that any of such liabilities to which the Company or any of its
affiliates may become subject will not have a material adverse effect upon the
business or financial condition of the Company.

SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of the Offering, the Company will have 16,200,000 shares of
Common Stock outstanding. The 4,000,000 shares sold in the Offering (4,600,000
if the Underwriters exercise in full the over-allotment option) will be freely
tradeable without restriction or further registration under the Securities Act
of 1933, as amended (the "Securities Act"), except for any shares held by an
"affiliate" of the Company. The 12,200,000

12
<PAGE>

shares to be held by the stockholders of the Company (11,600,000 if the
Underwriters exercise in full the over-allotment option) will be deemed to be
"restricted securities," as that term is defined in Rule 144 under the
Securities Act ("Rule 144"), in that such shares were issued in private
transactions not involving a public offering. None of such shares will be
eligible for sale under Rule 144 prior to the first anniversary of the closing
of the Offering. For a summary description of the requirements of Rule 144,
see "Shares Eligible for Future Sale." The Company intends to file a
registration statement on Form S-8 with respect to the shares reserved for
issuance under its 1997 Stock Incentive Plan, including the 725,000 shares of
Common Stock underlying options which the Company expects to award to certain
employees and directors pursuant to such plan upon the closing of the
Offering.

The Company and each of the Company's existing stockholders will enter into
lock-up agreements with the Representatives (as herein defined) not to sell or
otherwise dispose of any of their shares of Common Stock for a period of 180
days from the date of this Prospectus without the prior written consent of
Morgan Stanley & Co. Incorporated. Certain stockholders of the Company are
entitled to register their shares under the Securities Act for resale, at the
expense of the Company. See "Shares Eligible for Future Sale--Registration
Rights" and "Underwriters."

In March 1997, DEL/LaSalle Finance Company, L.L.C. ("DEL/LaSalle"), a
limited liability company, all of the membership interests of which are owned
by DEL-LPL Limited Partnership ("DEL-LPL") and DEL-LPAML Limited Partnership
("DEL-LPAML" and together with DEL-LPL, the "Employee Partnerships"), limited
partnerships which are comprised of approximately 200 of the Company's current
and former employees, purchased the limited partnership interests in the
Predecessor Partnerships owned by a subsidiary of Dresdner Bank AG
("Dresdner"). Dresdner was required to sell the interests in order to comply
with bank regulatory requirements. As consideration for such purchase,
DEL/LaSalle issued to Dresdner a $35.0 million promissory note (the "Dresdner
Note"). The purchase price was determined in May 1996 and was based on the
original purchase price for such interests plus Dresdner's share of expected
undistributed earnings for 1996. All of the 1,826,548 shares of Common Stock
to be received by DEL/LaSalle in connection with the Incorporation
Transactions and 2,831,150 of the shares of Common Stock held by the Employee
Partnerships, representing an aggregate of approximately 29% of the
outstanding Common Stock after giving effect to the Offering, will be pledged
to support DEL/LaSalle's obligations under the Dresdner Note. The principal
amount of the Dresdner Note is due in five installments, with $3.5 million due
on April 15, 2000 and $7.8 million due on each April 15 thereafter, through
2004. The Dresdner Note bears interest at 7.0% per annum, payable on each
April 15 beginning on April 15, 1998. DEL/LaSalle will not have any assets
other than the Common Stock issued in connection with the Incorporation
Transactions. Funds for repayment of the Dresdner Note, including interest
thereon, will be provided by capital contributions from the Employee
Partnerships and through the sale of Common Stock in the public market or in
privately negotiated transactions. DEL/LaSalle has granted the U.S.
Underwriters a 30-day option to purchase up to 600,000 shares of Common Stock
to cover over-allotments in connection with the Offering. In the event that
the Underwriters' over-allotment option is exercised, the proceeds to
DEL/LaSalle will be used to repay a portion of the Dresdner Note. If an event
of default occurs under the Dresdner Note, Dresdner will have the right to
sell any or all of the pledged shares in the public market or in privately
negotiated transactions, subject to compliance with the Securities Act and
applicable law. See "Shares Eligible for Future Sale" and "Underwriters."

No prediction can be made as to the effect, if any, that future sales of
shares, or the availability of shares for future sale, will have on the market
price of the Common Stock.

CONTROL BY PRINCIPAL STOCKHOLDER

Upon completion of this Offering, the Employee Partnerships, directly and
through DEL/LaSalle, will beneficially own approximately 48.0% of the
Company's outstanding shares of Common Stock (approximately 44.3% if the
Underwriters exercise in full the over-allotment option). Accordingly, the
Employee Partnerships will continue to be able to exercise substantial
influence over the business and affairs of the Company, including but not
limited to having sufficient voting power to substantially influence the
election of all of the directors to be elected at any annual or special
meeting of stockholders and, in general, to substantially influence the
outcome of any corporate transaction or other matter submitted to the
stockholders for approval, including mergers, consolidations, the sale of
substantially all of the Company's assets, charter amendments and other
extraordinary

13
<PAGE>

corporate transactions or may prevent or cause a change in the control of the
Company. The Common Stock will be voted in accordance with the direction of
partners having a majority of the percentage ownership interests in the
Employee Partnerships. In addition, Lizanne Galbreath, a director and member
of senior management of the Company, and other former stockholders of
Galbreath who are now employees of the Company will own an additional 6.7% of
the Company's outstanding shares of Common Stock following the Offering. See
"Principal and Selling Stockholders."

LACK OF PRIOR PUBLIC MARKET AND POSSIBLE VOLATILITY OF STOCK PRICE

Prior to the Offering, there has been no public market for the Common Stock.
Although application has been made to list the Common Stock on the New York
Stock Exchange, there can be no assurance that an active trading market will
develop or be sustained. The price of shares of Common Stock to be sold in the
Offering will be determined by negotiations among the Company and the
Underwriters and may be higher than the price at which the Common Stock will
trade after completion of the Offering. See "Underwriters" for factors to be
considered in determining such offering price. The market price of the Common
Stock could be subject to significant fluctuations in response to quarter-to-
quarter variations in operating results of the Company or its competitors,
conditions in the commercial real estate industry, the commencement of,
developments in or outcome of litigation, changes in estimates of the
Company's performance by securities analysts, and other events or factors,
including the events and other factors described in this "Risk Factors"
section. In addition, the stock market in recent years has experienced price
and volume fluctuations that have often been unrelated or disproportionate to
the operating performance of companies. These fluctuations, as well as general
economic and market conditions, may adversely affect the market price of the
Common Stock. See "Underwriters."

ANTI-TAKEOVER PROVISIONS

The Company's Articles of Amendment and Restatement (the "Restated Articles
of Incorporation") and Amended and Restated Bylaws (the "Bylaws") will include
provisions that may delay, defer or prevent a takeover attempt that may be in
the best interest of stockholders. The Company has a classified Board of
Directors, pursuant to which directors are divided into three classes, with
three-year staggered terms. The classified board provision could increase the
likelihood that, in the event an outside party acquired a controlling block of
the Company's stock or initiated a proxy contest, incumbent directors
nevertheless would retain their positions for a substantial period, which may
have the effect of discouraging, delaying or preventing a change in control of
the Company. In addition, the Restated Articles of Incorporation will provide
for: (i) the ability of the Board of Directors to establish one or more
classes and series of capital stock including the ability to issue up to
10,000,000 shares of preferred stock, and to determine the price, rights,
preferences and privileges of such capital stock without any further
stockholder approval; (ii) a requirement that any stockholder action without a
meeting be pursuant to unanimous written consent; and (iii) certain advance
notice procedures for nominating candidates for election to the Board of
Directors. Such provisions could discourage bids for the Common Stock at a
premium as well as affect the market price of the Common Stock. In addition,
certain provisions of the Maryland General Corporation Law (the "MGCL") may
also have the effect of delaying, deterring or preventing a change in the
control of the Company. The possible impact of these provisions on takeover
attempts could adversely affect the price of the Common Stock. See
"Description of Capital Stock."

ABSENCE OF DIVIDENDS; DIVIDEND POLICY

The Company does not currently intend to pay any dividends on the Common
Stock in the foreseeable future. Any payment of future dividends and the
amounts thereof will be dependent upon the Company's earnings, financial
requirements and other factors deemed relevant by the Company's Board of
Directors, including the Company's contractual obligations. The Company
expects that provisions to be contained in agreements governing the Company's
long-term indebtedness after the Offering will limit the amount of dividends
that the Company may pay to its stockholders. See "Dividend Policy."

IMMEDIATE AND SUBSTANTIAL DILUTION

The initial public offering price is expected to be substantially higher
than the pro forma net tangible book value per share of Common Stock. As a
result, assuming an initial public offering price of $20.00 per share,
purchasers of shares of Common Stock in the Offering will incur immediate and
substantial dilution of $16.07 in net tangible book value per share. See
"Dilution."

14
<PAGE>

FORWARD-LOOKING STATEMENTS

This Prospectus contains forward-looking statements. Discussions containing
such forward-looking statements may be found in the material set forth under
"Prospectus Summary," "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and "Business," as well as within this
Prospectus generally. In addition, when used in this Prospectus, the words
"believes," "intends," "anticipates," "expects" and words of similar import
may constitute "forward-looking statements." Such statements are subject to a
number of risks and uncertainties. Actual results in the future could differ
materially from those described in the forward-looking statements as a result
of the risk factors set forth above and the matters set forth in the
Prospectus generally.

15
<PAGE>

BACKGROUND OF THE COMPANY

The Company, founded in 1968, is a leading full-service real estate firm
that provides management services, corporate and financial services and
investment management services to corporations and other real estate owners
and investors worldwide. The Company has grown by expanding both its client
base and its range of services and products in anticipation of client needs
and to seize market opportunities. Primarily providing investment banking,
investment management and land services in its early years of existence, the
Company expanded to offer development management services beginning in 1975,
property management and leasing services beginning in 1978 and tenant
representation services beginning in 1978. In addition, the Company was a
pioneer in the facility management services business, first offered by the
Company in 1990.

The Predecessor Partnerships were formed in 1986 by the Employee
Partnerships to conduct the Company's business. In 1988, DSA-LSPL, Inc. and
DSA-LSAM, Inc., affiliates of Dai-ichi Life (U.S.A.), Inc. ("Dai-ichi"),
became limited partners of the Predecessor Partnerships.

In November 1994, the Predecessor Partnerships acquired substantially all of
the assets of Alex. Brown Kleinwort Benson Realty Advisors Corporation
("ABKB"), a real estate investment advisor, in exchange for a 20% limited
partnership interest in the Predecessor Partnerships (the "ABKB Acquisition").
Through its acquisition of Kleinwort Benson, the parent company of ABKB,
Dresdner acquired these limited partnership interests, but was required to
sell such interests in order to comply with bank regulatory requirements. In
March 1997, DEL/LaSalle purchased the Dresdner limited partnership interests
in exchange for a $35.0 million note. The purchase price was determined in May
1996 and was based on the original purchase price for such interests plus
Dresdner's share of expected undistributed earnings for 1996. Following the
repurchase, the Employee Partnerships, directly and through DEL/LaSalle, and
Dai-ichi had ownership interests in the Predecessor Partnerships of 75.6% and
24.4%, respectively. The Employee Partnerships are the sole general partners
of the Predecessor Partnerships. See "Shares Eligible for Future Sale."

In October 1996, the Predecessor Partnerships acquired all of the capital
stock of CIN Property Management Limited ("CIN Property Management"), the
affiliated real estate investment and property management advisor for the
British Coal Pension Fund. This entity immediately changed its name to CIN
LaSalle Investment Management Limited ("CIN LaSalle Investment").

On April 22, 1997, Galbreath, a property management, facility management and
development management company, merged with the Predecessor Partnerships. As
consideration for Galbreath, the Predecessor Partnerships issued to the former
stockholders of Galbreath limited partnership interests representing an 18%
interest in the Predecessor Partnerships. Following the Galbreath merger, the
Employee Partnerships, directly and through DEL/LaSalle, and Dai-ichi had
ownership interests in the Predecessor Partnerships of approximately 62% and
20%, respectively. The proportional interests of the Employee Partnerships,
DEL/LaSalle, Dai-ichi and the former stockholders of Galbreath may change
slightly depending upon the result of current negotiations between them
relating to a Galbreath joint venture. See "Business--Galbreath Acquisition."

The Company, LPMS, LPCFS and LACM were incorporated in Maryland in April
1997. Prior to the Incorporation Transactions (as defined below), the Company,
LPMS, LCFS and LACM will have no operations other than in connection with
their formation.

The Company's executive offices are located at 200 East Randolph Drive,
Chicago, Illinois 60601 and its telephone number is (312) 782-5800. The
Company has corporate offices in 10 United States cities and in London, Paris,
Mexico City and Beijing and has over 300 property and other offices throughout
the United States.

16
<PAGE>

INCORPORATION TRANSACTIONS

The Company and LPMS, LPCFS and LACM were formed in April 1997 in connection
with the conversion of the business and operations of the Predecessor
Partnerships from partnership to corporate form. Immediately prior to the
closing of the Offering, pursuant to agreements among the partners, each of
the general and limited partners of the Predecessor Partnerships will exchange
all of their respective general and limited partnership interests (the
"Partnership Interests Exchange") in the Predecessor Partnerships for an
aggregate of 12,200,000 shares of Common Stock. At March 31, 1997, the pro
forma book value of the Predecessor Partnerships' net assets was $43.4
million. See "Dilution" and "Pro Forma Consolidated Financial Statements." The
Company will cause the Predecessor Partnerships to contribute, among other
things, substantially all of their respective assets and liabilities (the
"Asset Contributions") relating to: (i) the management services group to LPMS;
(ii) the corporate and financial services group to LPCFS; and (iii) the
investment management group to LACM. LPII, an existing subsidiary of the
Predecessor Partnerships, will continue to conduct the Company's international
operations. Following the Partnership Interests Exchange and the Asset
Contributions, the Company will operate as a holding company with the business
and operations of the Predecessor Partnerships being conducted through the
Principal Operating Subsidiaries. The Predecessor Partnerships are undertaking
these transactions in order to facilitate access to the capital markets,
provide greater flexibility for acquisitions, create longer-term liquidity for
their partners and reduce administrative burdens associated with operating as
a partnership. Following the Partnership Interests Exchange, the Employee
Partnerships and DEL/LaSalle, Dai-ichi and the former stockholders of
Galbreath will own 63.7%, 18.3% and 18.0%, respectively, of the Company's
outstanding Common Stock immediately prior to the Offering. The percentage
ownership interest of the Employee Partnerships, DEL/LaSalle, Dai-ichi and the
former stockholders of Galbreath in the Company following the Partnership
Interests Exchange will be identical to their effective economic ownership
interests in the Predecessor Partnerships. See "Principal and Selling
Stockholders." The proportional interests of the Employee Partnerships,
DEL/LaSalle, Dai-ichi and the former stockholders of Galbreath may change
slightly depending upon the result of current negotiations between them
relating to a Galbreath joint venture. See "Business--Galbreath Acquisition."
The Partnership Interests Exchange and the Asset Contributions are
collectively referred to as the "Incorporation Transactions." The closing of
the Offering is conditioned upon, among other things, the completion of the
Partnership Interests Exchange. In connection with the Incorporation
Transactions, the Company will amend and restate its Articles of
Incorporation. See "Description of Capital Stock."

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<PAGE>

USE OF PROCEEDS

The net proceeds to the Company from the sale of the 4,000,000 shares of
Common Stock offered hereby (assuming an initial public offering price of
$20.00 per share), after deducting estimated underwriting discounts and
commissions and estimated expenses of the Offering payable by the Company, are
estimated to be approximately $72.4 million. The Company will not receive any
proceeds from the exercise of the over-allotment option.

The Company will use the net proceeds to repay the full amount of the
indebtedness outstanding under promissory notes issued to Dai-ichi (the "Dai-
ichi Notes"). Any remaining proceeds will be used to repay the indebtedness
outstanding under the Company's long-term credit facility (the "Long-Term
Facility") and for general corporate purposes. The Dai-ichi Notes consist of
approximately $6.2 million principal amount of Class A Notes and $31.0 million
principal amount of Class B Notes, each bearing interest at 10.0%, payable
annually on December 31. Principal payments on the Class A Notes are due in
two equal installments on June 30, 1997 and 1998. Principal payments on the
Class B Notes are due in 10 equal installments on June 30th of each year
beginning in 1999. Borrowings under the Long-Term Facility mature on September
6, 1999, and bear interest at the greater of the lending bank's prime rate and
the applicable federal funds rate plus .5%. Principal payments on borrowings
under the Long-Term Facility are payable on June 15 of each year for amounts
outstanding on March 31, based on a defined amortization schedule. As of March
31, 1997, the principal amount of borrowings under the Long-Term Facility was
approximately $29.2 million, of which approximately $23.3 million is
anticipated to be outstanding at the time of the Offering. Upon completion of
the Offering, the Company intends to use its borrowing capacity, cash
generated from operations and the remaining net proceeds of the Offering to
pursue its growth strategy, including international expansion, selective
acquisitions and co-investment activities. Pending application of the net
proceeds of the Offering as described herein, the Company intends to invest
the proceeds in investment-grade, short-term, interest-bearing securities.

DIVIDEND POLICY

The Company has not paid any dividends on its Common Stock to date. After
the Offering, the Company intends to retain its earnings to support the
expansion of its business. Any dividends declared will be at the discretion of
the Board of Directors and will depend upon the Company's financial condition,
earnings and other factors, including the terms of the Company's indebtedness.
The Company expects that provisions to be contained in agreements governing
the Company's long-term indebtedness after the Offering will limit the amount
of dividends that the Company may pay to its stockholders.

18
<PAGE>

CAPITALIZATION

The following table sets forth the pro forma short-term debt and
capitalization of the Company at March 31, 1997, as adjusted to give effect to
the merger of Galbreath with the Company and the Incorporation Transactions as
if such transactions had occurred on March 31, 1997, and as further adjusted
to give effect to the sale of 4,000,000 shares of Common Stock offered hereby
at an assumed initial public offering price of $20.00 per share, and the
receipt and application of the net proceeds therefrom, as described under "Use
of Proceeds." This table should be read in conjunction with "Management's
Discussion and Analysis of Financial Condition and Results of Operations,"
"Pro Forma Consolidated Financial Statements" and the Predecessor
Partnerships' Combined Financial Statements and the notes thereto, all
included elsewhere herein.

<TABLE>
<CAPTION>
MARCH 31, 1997
--------------------
PRO PRO FORMA
FORMA AS ADJUSTED
-------- -----------
(IN THOUSANDS,
EXCEPT SHARE DATA)
<S> <C> <C>
Short-term debt:
Borrowings under short-term credit facility............. $ 16,800 $ 16,800
Current maturities of long-term debt(1)................. 9,332 --
-------- --------
Total short-term debt................................. $ 26,132 $ 16,800
======== ========
Long-term debt:
Long-term credit facility, less current maturities(1)... $ 22,977 $ --
Subordinated loans, less current maturities............. 34,106 --
-------- --------
Total long-term debt, less current maturities......... 57,083 --
-------- --------
Stockholders' equity:
Preferred stock, $.01 par value per share, 10,000,000
shares authorized; no shares issued and outstanding.... -- --
Common Stock, $.01 par value per share, 100,000,000
shares authorized; 12,200,000 shares issued and
outstanding pro forma; 16,200,000 shares issued and
outstanding pro forma as adjusted(2)................... 122 162
Additional paid-in capital.............................. 43,314 115,674
Retained earnings....................................... -- --
-------- --------
Total stockholders' equity............................ 43,436 115,836
-------- --------
Total capitalization................................ $100,519 $115,836
======== ========
</TABLE>
- --------
(1) See Note 7 to Notes to the Predecessor Partnerships' Combined Financial
Statements.
(2) Excludes an aggregate of: (i) 725,000 shares of Common Stock issuable upon
exercise of options to be granted under the Company's 1997 Stock Incentive
Plan upon closing of the Offering, with an exercise price equal to the
initial public offering price; and (ii) 1,490,000 additional shares of
Common Stock reserved for future grants or awards under the Company's 1997
Stock Incentive Plan. See "Management--Director Compensation" and "--1997
Stock Award and Incentive Plan."

19
<PAGE>

DILUTION

The pro forma net tangible book value (deficit) of the Company as of March
31, 1997 (as adjusted to give effect to the merger of Galbreath with the
Company and the Incorporation Transactions) was $(8.8) million, or $(.72) per
share of Common Stock. Pro forma net tangible book value (deficit) per share
is determined by dividing the tangible net worth of the Company (total assets
less intangible assets and total liabilities) by the aggregate number of
shares of Common Stock outstanding, assuming the merger of Galbreath with the
Company and the Incorporation Transactions had taken place on March 31, 1997.
Without taking into account any changes in such net tangible book value after
March 31, 1997, other than to give effect to the sale of the 4,000,000 shares
of Common Stock offered hereby (at an assumed initial public offering price of
$20.00 per share) and the receipt and application of the net proceeds
therefrom, pro forma net tangible book value of the Company as of March 31,
1997 would have been approximately $63.6 million, or $3.93 per share. This
represents an immediate increase in net tangible book value of $4.65 per share
to the current stockholders of the Company and an immediate dilution in net
tangible book value of $16.07 per share to purchasers of Common Stock in the
Offering. The following table illustrates this per share dilution.

<TABLE>
<S> <C> <C>
Assumed initial public offering price per share............ $20.00
Pro forma net tangible book value (deficit) per share at
March 31, 1997............................................ $(.72)
Increase in pro forma net tangible book value per share
attributable to purchasers in the Offering................ 4.65
-----
Pro forma net tangible book value per share after the
Offering.................................................. 3.93
------
Dilution in pro forma net tangible book value per share to
purchasers in the Offering................................ $16.07
======
</TABLE>

The following table summarizes on a pro forma basis, as of March 31, 1997,
the difference between the existing stockholders and the purchasers of shares
in the Offering (at an assumed initial public offering price of $20.00 per
share, before deducting estimated underwriting discounts and commissions and
estimated offering expenses) with respect to the number of shares of Common
Stock purchased from the Company, the total consideration paid and the average
price per share paid:

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION AVERAGE
------------------ -------------------- PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
---------- ------- ------------ ------- ---------
<S> <C> <C> <C> <C> <C>
Existing stockholders.. 12,200,000 75.3% $ 43,436,000 35.2% $3.56
New investors.......... 4,000,000 24.7 80,000,000 64.8 20.00
---------- ----- ------------ -----
Total................ 16,200,000 100.0% $123,436,000 100.0% 7.62
========== ===== ============ =====
</TABLE>

The foregoing calculations exclude an aggregate of: (i) 725,000 shares of
Common Stock issuable upon exercise of options to be granted under the
Company's 1997 Stock Incentive Plan upon closing of the Offering, with an
exercise price equal to the initial public offering price; and (ii) 1,490,000
additional shares of Common Stock reserved for future grants or awards under
the Company's 1997 Stock Incentive Plan. See "Management--Director
Compensation" and "--1997 Stock Award and Incentive Plan."

20
<PAGE>

SELECTED FINANCIAL DATA

The following table sets forth, for the periods and as of the dates
indicated, selected financial and other data on a pro forma basis for the
Company and on a historical combined basis for the Predecessor Partnerships.
The selected financial data as of December 31, 1995 and 1996 and for the years
ended December 31, 1994, 1995 and 1996 have been derived from the Predecessor
Partnerships' Combined Financial Statements audited by KPMG Peat Marwick LLP,
independent certified public accountants, included elsewhere herein. The
selected financial data as of December 31, 1992, 1993 and 1994 and for the
years ended December 31, 1992 and 1993 have been derived from the Predecessor
Partnerships' Combined Financial Statements audited by KPMG Peat Marwick LLP,
not included herein. The selected financial data as of March 31, 1997 and for
the three months ended March 31, 1996 and March 31, 1997 have been derived
from the Predecessor Partnerships' Unaudited Combined Financial Statements
also included elsewhere herein. Such financial statements include all
adjustments, consisting of normal recurring adjustments, which the Company
considers necessary for a fair presentation of its financial position and
results of operations for these periods. Operating results for the three
months ended March 31, 1997 are not necessarily indicative of results that may
be expected for the entire year. The unaudited pro forma, as adjusted,
statement of operations data for 1996 and for the three months ended March 31,
1997 give effect to the merger of Galbreath with the Company, the
Incorporation Transactions (as described under the heading "Incorporation
Transactions") and the Offering as if they occurred on January 1, 1996. In
addition, the unaudited pro forma, as adjusted, balance sheet data as of March
31, 1997 give effect to the merger of Galbreath with the Company, the
Incorporation Transactions and the Offering as if they occurred on March 31,
1997. The information set forth below should be read in conjunction with "Pro
Forma Consolidated Financial Statements," "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and the Predecessor
Partnerships' Combined Financial Statements and the notes thereto, all
included elsewhere herein.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------------------------------------------------
1996 PRO FORMA
AS ADJUSTED
1992 1993 1994 1995 1996 (1)
---------- ---------- ----------- ----------- ----------- --------------
(IN THOUSANDS, EXCEPT SHARE DATA)
<S> <C> <C> <C> <C> <C> <C>
STATEMENT OF
OPERATIONS
DATA:
Total revenue... $ 103,334 $ 104,049 $ 126,918 $ 151,827 $ 175,967 $ 207,559
Total operating
expenses....... 84,722 87,036 108,903 131,711 149,066 177,382
---------- ---------- ----------- ----------- ----------- -----------
Operating income
(loss)......... 18,612 17,013 18,015 20,116 26,901 30,177
Interest
expense........ 5,590 5,257 5,159 3,806 5,730 1,075
Earnings (loss)
before
provision for
income taxes... 13,022 11,756 12,856 16,310 21,171 29,102
Net provision
(benefit) for
income taxes... 355 300 554 505 1,207 11,204
---------- ---------- ----------- ----------- ----------- -----------
Net earnings
(loss)......... $ 12,667 $ 11,456 $ 12,302 $ 15,805 $ 19,964 $ 17,898
========== ========== =========== =========== =========== ===========
Pro forma:
Supplemental
primary and
fully diluted
earnings (loss)
per share (2).. $ 1.13
===========
OTHER DATA:
EBITDA (3)...... $ 21,034 $ 19,544 $ 20,866 $ 24,356 $ 32,317 $ 37,624
Cash flows
provided by
(used in)
operating
activities..... 14,675 4,837 24,628 13,553 13,964 13,646
Cash flows
provided by
(used in)
investing
activities..... (1,727) (2,738) (4,885) (5,706) (32,478) (31,852)
Cash flows
provided by
(used in)
financing
activities..... (19,000) (6,758) (12,028) (12,365) 17,189 19,195
Investments
under
management (4). $6,500,000 $7,000,000 $10,700,000 $11,500,000 $15,200,000 $15,200,000
Total square
feet-facility
management (5). 2,400 50,600 50,600 67,600 68,600 81,600
Total square
feet under
management (6). 47,000 98,300 102,400 125,700 131,600 202,900
<CAPTION>
THREE MONTHS ENDED MARCH 31,
----------------------------------------
1997 PRO FORMA
AS ADJUSTED
1996 1997 (1)
------------ ------------ --------------
<S> <C> <C> <C>
STATEMENT OF
OPERATIONS
DATA:
Total revenue... $ 27,285 $ 36,019 $ 43,384
Total operating
expenses....... 32,490 39,291 46,269
------------ ------------ --------------
Operating income
(loss)......... (5,205) (3,272) (2,885)
Interest
expense........ 937 1,695 265
Earnings (loss)
before
provision for
income taxes... (6,142) (4,967) (3,150)
Net provision
(benefit) for
income taxes... (350) (248) (1,213)
------------ ------------ --------------
Net earnings
(loss)......... $ (5,792) $ (4,719) $ (1,937)
============ ============ ==============
Pro forma:
Supplemental
primary and
fully diluted
earnings (loss)
per share (2).. $ (0.12)
==============
OTHER DATA:
EBITDA (3)...... $ (4,094) $ (1,498) $ (599)
Cash flows
provided by
(used in)
operating
activities..... (12,721) (4,678) (7,892)
Cash flows
provided by
(used in)
investing
activities..... (5,967) (2,038) (2,185)
Cash flows
provided by
(used in)
financing
activities..... 14,921 7,705 7,573
Investments
under
management (4). $11,500,000 $15,100,000 $15,100,000
Total square
feet-facility
management (5). 67,600 69,100 82,100
Total square
feet under
management (6). 130,200 132,700 204,000
</TABLE>

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31, 1997
---------------------------------------------- ------------------------
PRO FORMA
1992 1993 1994 1995 1996 ACTUAL AS ADJUSTED (7)
-------- -------- -------- -------- -------- -------- ---------------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Cash and cash
equivalents............ $ 9,784 $ 5,125 $ 12,840 $ 8,322 $ 7,207 $ 8,094 $ 14,994
Total assets............ 72,590 84,512 107,055 115,001 156,614 124,075 166,411
Long-term debt (8)...... 51,319 56,619 41,028 40,805 55,551 57,083 --
Total liabilities....... 87,277 99,801 93,898 100,004 132,367 109,425 50,575
Total partners' capital
(deficit)/stockholders'
equity................. (14,687) (15,289) 13,157 14,997 24,247 14,650 115,836
</TABLE>
- -------
(Footnotes on following page)

21
<PAGE>

- --------

(1) As adjusted to give effect to the merger of Galbreath with the Company,
the Incorporation Transactions and the sale of the shares of Common Stock
offered by the Company hereby at an assumed initial public offering price
of $20.00 per share and the receipt and application of the net proceeds
therefrom to retire debt, as though they had occurred on January 1, 1996.
See "Use of Proceeds," "Background of the Company" and "Incorporation
Transactions."

(3) EBITDA represents earnings before interest, income taxes, depreciation and
amortization, thereby removing the effect of certain non-cash charges on
income, such as the amortization of intangible assets relating to
acquisitions. Management believes that EBITDA is useful to investors
because it is widely used in the real estate industry as a recognized
measure of operating performance, cash generation and ability to service
debt and is also used by analysts who report publicly on the performance
of real estate services companies. However, EBITDA should not be
considered as an alternative either to: (i) net earnings (determined in
accordance with GAAP); (ii) operating cash flow (determined in accordance
with GAAP); or (iii) liquidity. There can be no assurance that the
Company's calculation of EBITDA is comparable to similarly titled items
reported by other companies.
(4) Investments under management represents the aggregate fair market value or
cost basis of assets managed by the Investment Management group as of the
end of the periods shown. The percentage of investments under management
stated at cost represented 3% in 1992 and 1993, 7% in 1994 and 1995, and
8% in 1996 and 1997 of the amounts shown.
(5) Represents the total square footage of properties for which the Company
provided facility management services as of the end of the periods shown.
(6) Represents the total square footage of properties for which the Company
provided property management and leasing or facility management services
as of the end of the periods shown.

(7) As adjusted to give effect to the merger of Galbreath with the Company,
the Incorporation Transactions and the sale of the shares of Common Stock
offered by the Company hereby at an assumed initial public offering price
of $20.00 per share and the receipt and application of the net proceeds
therefrom to retire debt, as though they had occurred on March 31, 1997.
See "Use of Proceeds," "Background of the Company" and "Incorporation
Transactions."
(8) See Note 7 to Notes to the Predecessor Partnerships' Combined Financial
Statements.

22
<PAGE>

PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS

The following unaudited pro forma consolidated financial statements are
derived from the Predecessor Partnerships' Combined Financial Statements. The
unaudited pro forma consolidated statements of earnings give effect to the
merger of Galbreath with the Company and the Incorporation Transactions, as if
they had occurred on January 1, 1996. The unaudited pro forma consolidated
statements of earnings, as adjusted, give further effect to the Offering and
the receipt and application of the net proceeds therefrom. The unaudited pro
forma consolidated balance sheet gives effect to the merger of Galbreath with
the Company and the Incorporation Transactions, as if they had occurred on
March 31, 1997. The unaudited pro forma consolidated balance sheet, as
adjusted, gives further effect to the Offering and the receipt and application
of the net proceeds therefrom. See "Incorporation Transactions," "Use of
Proceeds," "Capitalization," and "Management's Discussion and Analysis of
Financial Condition and Results of Operations." The unaudited pro forma
consolidated financial statements should be read in conjunction with the
Predecessor Partnerships' Combined Financial Statements and the notes thereto,
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," and other financial information, all included elsewhere herein.

The pro forma adjustments are based upon available information and certain
assumptions that management of the Company believes are reasonable under the
circumstances. The pro forma consolidated financial statements are not
necessarily indicative of what the actual financial position and results of
operations would have been as of March 31, 1997 and for the year ended
December 31, 1996 and the three months ended March 31, 1997 had the Company
completed the merger of Galbreath with the Company and consummated the
Incorporation Transactions and the Offering (and the receipt and application
of the net proceeds therefrom) as of the dates indicated nor does it purport
to represent the future financial position or results of operations of the
Company.

UNAUDITED PRO FORMA CONSOLIDATED STATEMENTS OF EARNINGS

<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31, 1997
------------------------------------------------------------------------------------------------
GALBREATH MERGER
HISTORICAL -----------------------------------
COMBINED DISPOSITION OF PRO FORMA
PREDECESSOR HISTORICAL BUSINESS UNITS PRO ACQUISITION INCORPORATION COMPANY/
PARTNERSHIPS (1) COMBINED (1) ADJUSTMENTS (2) FORMA ADJUSTMENTS (3) ADJUSTMENTS GALBREATH
---------------- ------------ --------------- ------ --------------- ------------- ----------
(IN THOUSANDS, EXCEPT SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenue:
Fee-based
services....... $34,244 $12,648 $(6,022) $6,626 $ -- $ -- $ 40,870
Equity in
earnings from
unconsolidated
ventures....... 1,394 73 -- 73 -- -- 1,467
Construction
operations,
net............ 205 -- -- -- -- -- 205
Other income.... 176 783 (117) 666 -- -- 842
------- ------- ------- ------ ----- ------- ----------
Total revenue... 36,019 13,504 (6,139) 7,365 -- -- 43,384
Operating
expenses:
Compensation and
benefits....... 27,217 9,814 (5,246) 4,568 -- -- 31,785
Other operating
and
administrative. 10,300 2,884 (1,174) 1,710 -- -- 12,010
Depreciation and
amortization... 1,774 179 -- 179 333 -- 2,286
------- ------- ------- ------ ----- ------- ----------
Total operating
expenses....... 39,291 12,877 (6,420) 6,457 333 -- 46,081
------- ------- ------- ------ ----- ------- ----------
Operating income
(loss)......... (3,272) 627 281 908 (333) -- (2,697)
Interest expense. 1,695 72 (72) -- -- -- 1,695
------- ------- ------- ------ ----- ------- ----------
Earnings (loss)
before
provision for
income taxes... (4,967) 555 353 908 (333) -- (4,392)
Net provision
(benefit) for
income taxes.... (248) 33 -- 33 -- (1,476)(6) (1,691)
------- ------- ------- ------ ----- ------- ----------
Net earnings
(loss)......... $(4,719) $ 522 $ 353 $ 875 $(333) $ 1,476 $ (2,701)
======= ======= ======= ====== ===== ======= ==========
Primary and fully
diluted earnings
(loss) per
share........... $ (0.22)
==========
Supplemental
primary and
fully diluted
earnings (loss)
per share.......

Shares used in
computation of
primary and
fully diluted
earnings per
share........... 12,200,000 (8)
==========
</TABLE>

PRO FORMA
OFFERING AS
ADJUSTMENTS ADJUSTED
----------- ----------

<S> <C> <C>
Revenue:
Fee-based
services....... $ -- $ 40,870
Equity in
earnings from
unconsolidated
ventures....... -- 1,467
Construction
operations,
net............ -- 205
Other income.... -- 842
------ ----------
Total revenue... -- 43,384
Operating
expenses:
Compensation and
benefits....... -- 31,785
Other operating
and
administrative. 188 (4) 12,198
Depreciation and
amortization... -- 2,286
------ ----------
Total operating
expenses....... 188 46,269
------ ----------
Operating income
(loss)......... (188) (2,885)
Interest expense. (1,430)(5) 265
------ ----------
Earnings (loss)
before
provision for
income taxes... 1,243 (3,150)
Net provision
(benefit) for
income taxes.... 478 (6) (1,213)
------ ----------
Net earnings
(loss)......... $ 764 $ (1,937)
====== ==========
Primary and fully
diluted earnings
(loss) per
share...........

Supplemental
primary and
fully diluted
earnings (loss)
per share....... $ (0.12)(7)
==========
Shares used in
computation of
primary and
fully diluted
earnings per
share........... 15,869,337 (7)
==========
</TABLE>
- -------
(Footnotes on following page)

23
<PAGE>

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1996
-------------------------------------------------------------------------------------------------
GALBREATH MERGER
HISTORICAL ------------------------------------
COMBINED DISPOSITION OF PRO FORMA
PREDECESSOR HISTORICAL BUSINESS UNITS PRO ACQUISITION INCORPORATION COMPANY/
PARTNERSHIPS (1) COMBINED (1) ADJUSTMENTS (2) FORMA ADJUSTMENTS (3) ADJUSTMENTS GALBREATH
---------------- ------------ --------------- ------- --------------- ------------- ----------
(IN THOUSANDS, EXCEPT SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenue:
Fee-based
services....... $170,709 $53,326 $(25,731) $27,595 $ -- $ -- $ 198,304
Equity in
earnings from
unconsolidated
ventures....... 3,220 572 -- 572 -- -- 3,792
Construction
operations,
net............ 1,271 -- -- -- -- -- 1,271
Other income.... 767 4,068 (643) 3,425 -- -- 4,192
-------- ------- -------- ------- ------- ------- ----------
Total revenue... 175,967 57,966 (26,374) 31,592 -- -- 207,559
Operating
expenses:
Compensation and
benefits....... 104,673 41,747 (23,965) 17,782 -- -- 122,455
Other operating
and
administrative. 38,977 12,055 (4,302) 7,753 -- -- 46,730
Depreciation and
amortization... 5,416 701 -- 701 1,330 -- 7,447
-------- ------- -------- ------- ------- ------- ----------
Total operating
expenses....... 149,066 54,503 (28,267) 26,236 1,330 -- 176,632
-------- ------- -------- ------- ------- ------- ----------
Operating income
(loss)......... 26,901 3,463 1,893 5,356 (1,330) -- 30,927
Interest expense. 5,730 504 (504) -- -- -- 5,730
-------- ------- -------- ------- ------- ------- ----------
Earnings before
provision for
income taxes... 21,171 2,959 2,397 5,356 (1,330) -- 25,197
Net provision for
income taxes.... 1,207 210 -- 210 -- 8,284 (6) 9,701
-------- ------- -------- ------- ------- ------- ----------
Net earnings
(loss)......... $ 19,964 $ 2,749 $ 2,397 $ 5,146 $(1,330) $(8,284) $ 15,496
======== ======= ======== ======= ======= ======= ==========
Primary and fully
diluted earnings
per share....... $ 1.27
==========
Supplemental
primary and
fully diluted
earnings per
share...........

Shares used in
computation of
primary and
fully diluted
earnings per
share........... 12,200,000(8)
==========
</TABLE>

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1996
------------------------

PRO FORMA
OFFERING AS
ADJUSTMENTS ADJUSTED
----------- ----------

<S> <C> <C>
Revenue:
Fee-based
services....... $ -- $ 198,304
Equity in
earnings from
unconsolidated
ventures....... -- 3,792
Construction
operations,
net............ -- 1,271
Other income.... -- 4,192
------- ----------
Total revenue... -- 207,559
Operating
expenses:
Compensation and
benefits....... -- 122,455
Other operating
and
administrative. 750 (4) 47,480
Depreciation and
amortization... -- 7,447
------- ----------
Total operating
expenses....... 750 177,382
------- ----------
Operating income
(loss)......... (750) 30,177
Interest expense. (4,655)(5) 1,075
------- ----------
Earnings before
provision for
income taxes... 3,905 29,102
Net provision for
income taxes.... 1,503 (6) 11,204
------- ----------
Net earnings
(loss)......... $ 2,402 $ 17,898
======= ==========
Primary and fully
diluted earnings
per share.......

Supplemental
primary and
fully diluted
earnings per
share........... $ 1.13(7)
==========
Shares used in
computation of
primary and
fully diluted
earnings per
share........... 15,869,337(7)
==========
</TABLE>

(1) The "Historical" columns represent the combined statements of operations
of the Predecessor Partnerships and the combined statements of operations
of Galbreath for the three months ended March 31, 1997 and the year ended
December 31, 1996.
(2) These adjustments give effect to the elimination of revenue and related
compensation, benefits, operating and other expenses associated with
Galbreath's tenant representation and investment banking units which, in
connection with the merger, are being disposed of or eliminated, and the
elimination of interest expense related to Galbreath's debt which was
repaid in connection with the merger of Galbreath with the Company. Such
business units were not retained as they did not meet the strategic
objectives of the Company.
(3) The adjustment gives effect to the amortization of intangibles and
goodwill associated with the merger of Galbreath with the Company.
(4) The adjustment gives effect to the estimated incremental general and
administrative costs associated with operation as a public company.
(5) The adjustment gives effect to the repayment of the Dai-ichi Notes and the
Long-Term Facility. See "Use of Proceeds."
(6) The adjustment gives effect to the provision (benefit) for income taxes as
though the Company and Galbreath were taxable entities as of January 1,
1996 at an estimated effective tax rate of 38.5%.
(7) Includes the 12,200,000 shares of Common Stock to be issued in connection
with the Incorporation Transactions and 3,669,337 of the 4,000,000 shares
of Common Stock to be issued in the Offering, the proceeds of which will
be used to repay indebtedness. The Company will have 16,200,000 shares of
Common Stock outstanding upon completion of the Offering. See "Use of
Proceeds."
(8) Represents the 12,200,000 shares to be issued in connection with the
Incorporation Transactions.

24
<PAGE>

UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET

<TABLE>
<CAPTION>
MARCH 31, 1997
-----------------------------------------------------------------------------------------
GALBREATH MERGER
HISTORICAL ---------------------------------
COMBINED DISPOSITION OF PRO FORMA
PREDECESSOR HISTORICAL BUSINESS UNITS PRO ACQUISITION INCORPORATION COMPANY/
PARTNERSHIPS(1) COMBINED(1) ADJUSTMENTS(2) FORMA ADJUSTMENTS ADJUSTMENTS(3) GALBREATH
--------------- ----------- -------------- ------ ----------- -------------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash
equivalents.... $ 8,094 $ 2,689 $ (1,774) $ 915 $ -- $ -- $ 9,009

Trade
receivables.... 52,052 8,665 (5,641) 3,024 -- -- 55,076
Other
receivables.... 4,116 1,020 (596) 424 -- -- 4,540
Prepaid
expenses....... 1,115 -- -- -- -- -- 1,115
Deferred tax
asset.......... -- -- -- -- 179(6) -- 179
Other assets.... -- 3,576 (3,576) -- -- -- --
-------- ------- -------- ------ ------- ------- --------
Total current
assets......... 65,377 15,950 (11,587) 4,363 179 -- 69,919
Property and
equipment....... 14,409 2,183 (35) 2,148 -- -- 16,557
Goodwill
resulting from
business
acquisitions.... 10,827 -- -- -- 23,651 (6) -- 34,478
Intangibles
resulting from
business
acquisitions.... 11,820 -- -- -- 5,913 (6) -- 17,733
Investment in
Galbreath....... -- -- -- -- 29,293 (7) -- --
(29,293)(6)
Investments in
real estate
ventures........ 15,752 129 (32) 97 -- -- 15,849
Long-term
receivables,
net............. 4,878 291 (291) -- -- -- 4,878
Other assets,
net............. 1,012 1,003 (1,003) -- -- -- 1,012
-------- ------- -------- ------ ------- ------- --------
$124,075 $19,556 $(12,948) $6,608 $29,743 $ -- $160,426
======== ======= ======== ====== ======= ======= ========

LIABILITIES AND PARTNERS' CAPITAL/STOCKHOLDERS' EQUITY

Current
liabilities:
Accounts payable
and accrued
liabilities.... $ 19,059 $ 3,559 $ -- $3,559 $ 507 (7) $ -- $ --
886 (6)
24,011
Accrued
compensation... 6,143 5,317 (2,867) 2,450 -- -- 8,593
Borrowings under
short-term
credit
facility....... 16,800 930 (930) -- -- -- 16,800
Current
maturities of
long-term debt. 9,332 599 (599) -- -- -- 9,332
-------- ------- -------- ------ ------- ------- --------
Total current
liabilities.... 51,334 10,405 (4,396) 6,009 1,393 -- 58,736
Long-term debt:
Subordinated
loans, less
current
maturities..... 34,106 -- -- -- -- -- 34,106
Long-term credit
facility, less
current
maturities..... 22,977 455 (455) -- -- -- 22,977
-------- ------- -------- ------ ------- ------- --------
Total long-term
debt........... 57,083 455 (455) -- -- -- 57,083
Other long-term
liabilities..... 1,008 -- -- -- 163 (6) -- 1,171
-------- ------- -------- ------ ------- ------- --------
Total
liabilities.... 109,425 10,860 (4,851) 6,009 1,556 -- 116,990
Partners'
capital/stockholders'
equity:
Common stock.... -- -- -- -- -- 122 122
Additional paid-
in capital..... -- -- -- -- -- 43,314 43,314
Retained
earnings....... -- -- -- -- -- -- --
Predecessor
Partnership's
partners'
capital........ 14,650 -- -- -- 28,786 (7) (43,436) --
Galbreath
owners' equity. -- 8,696 (8,097) 599 (599)(6) -- --
-------- ------- -------- ------ ------- ------- --------
Total partners'
capital/
stockholders'
equity......... 14,650 8,696 (8,097) 599 28,187 -- 43,436
-------- ------- -------- ------ ------- ------- --------
$124,075 $19,556 $(12,948) $6,608 $29,743 $ -- $160,426
======== ======= ======== ====== ======= ======= ========
- -------
</TABLE>

<TABLE>
<CAPTION>
MARCH 31, 1997
----------------------

PRO
OFFERING FORMA AS
ADJUSTMENTS ADJUSTED
----------- --------

<S> <C> <C>
ASSETS
Current assets:
Cash and cash
equivalents.... $72,400 (4)
(66,415)(5) $ 14,994
Trade
receivables.... -- 55,076
Other
receivables.... -- 4,540
Prepaid
expenses....... -- 1,115
Deferred tax
asset.......... -- 179
Other assets.... -- --
------- --------
Total current
assets......... 5,985 75,904
Property and
equipment....... -- 16,557
Goodwill
resulting from
business
acquisitions.... -- 34,478
Intangibles
resulting from
business
acquisitions.... -- 17,733
Investment in
Galbreath....... -- --

Investments in
real estate
ventures........ -- 15,849
Long-term
receivables,
net............. -- 4,878
Other assets,
net............. -- 1,012
------- --------
$ 5,985 $166,411
======= ========

LIABILITIES AND PARTNERS

Current
liabilities:
Accounts payable
and accrued
liabilities.... $ -- $ --

24,011
Accrued
compensation... -- 8,593
Borrowings under
short-term
credit
facility....... -- 16,800
Current
maturities of
long-term debt. (9,332)(5) --
------- --------
Total current
liabilities.... (9,332) 49,404
Long-term debt:
Subordinated
loans, less
current
maturities..... (34,106)(5) --
Long-term credit
facility, less
current
maturities..... (22,977)(5) --
------- --------
Total long-term
debt........... (57,083) --
Other long-term
liabilities..... -- 1,171
------- --------
Total
liabilities.... (66,415) 50,575
Partners'
capital/stockholders'
equity:
Common stock.... 40 (4) 162
Additional paid-
in capital..... 72,360 (4) 115,674
Retained
earnings....... -- --
Predecessor
Partnership's
partners'
capital........ -- --
Galbreath
owners' equity. -- --
------- --------
Total partners'
capital/
stockholders'
equity......... 72,400 115,836
------- --------
$ 5,985 $166,411
======= ========
</TABLE>
- -------
(1) The "Historical" columns represent the combined balance sheet of the
Predecessor Partnerships as of March 31, 1997, and the combined balance
sheet of Galbreath as of March 31, 1997.
(2) These adjustments give effect to the distribution of certain assets and
liabilities, including assets and liabilities associated with Galbreath's
tenant representation and investment banking units, which will be made in
connection with the merger of Galbreath with the Company and the repayment
of debt in connection with the merger of Galbreath with the Company. Such
business units were not retained as they did not meet the strategic
objectives of the Company.
(3) These adjustments give effect to the issuance of 12,200,000 shares of
Common Stock in exchange for all of the outstanding partnership interests
of the Predecessor Partners in connection with the Incorporation
Transactions.
(4) This adjustment gives effect to the receipt of $72,400 of net proceeds
from the issuance of 4,000,000 shares of Common Stock in the Offering (at
an assumed initial public offering price of $20.00 per share).
(5) This adjustment gives effect to the repayment of the Dai-ichi Notes and
the Long-Term Facility. See "Use of Proceeds."

(6) These adjustments give effect to the allocation of the purchase price of
Galbreath of $29,293 to identifiable assets and liabilities at their
estimated fair values. The excess purchase price of $29,564 was allocated
to management contracts ($5,913) and goodwill ($23,651), which are being
amortized over 8 years and 40 years, respectively, based on the Company's
estimate of useful lives. The Company's estimate of useful lives was based
on the nature and terms of management contracts acquired, Galbreath's
existing client relationships, operating history and market presence, and
the Company's operating experience within the industry. Due to the nature
and expected recovery of assets and settlement of liabilities, historical
stated value approximates fair value. Estimated current and long-term
obligations resulting from the merger of $886 and $163, respectively, have
been recorded as liabilities and additional goodwill and intangible
assets. Upon conversion to a corporation, Galbreath will recognize a
deferred tax asset of $179 which has been deducted from goodwill and
intangible assets.
(7) This adjustment represents management's estimate of the fair value of
Galbreath of $29,293, including transaction related costs of $507, which
is based upon the estimated fair value of the consideration received by
the Company which was based on a discounted EBITDA analysis. Such value is
consistent with the value used to execute cash purchase and sale
transactions by the Employee Partnerships at December 31, 1996.

25
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

LaSalle Partners is a leading full service real estate firm that provides
management services, corporate and financial services and investment
management services to corporations and other real estate owners, users and
investors worldwide. The Management Services segment provides three primary
service capabilities: (i) property management and leasing for property owners;
(ii) facility management for properties occupied by corporate owners and
users; and (iii) development management for both investors and real estate
users seeking to develop new buildings or renovate existing facilities. The
Corporate and Financial Services segment provides transaction and advisory
services through three primary service capabilities: (i) tenant representation
for corporations and professional service firms; (ii) investment banking
services to address the financing, acquisition and disposition needs of real
estate owners; and (iii) land acquisition and development services for owners,
users and developers of land. The Investment Management segment provides real
estate investment management services to institutional investors, corporations
and high net worth individuals.

The Company has benefited from the recovery in real estate markets which
began in 1993. Specifically, rising rental and occupancy rates have positively
affected revenue for the Company's property management and leasing and tenant
representation businesses. In addition, improving real estate property values
and improved trading values for public real estate securities have resulted in
higher revenue for the Company's Investment Management segment.

Although a significant portion of the Company's revenue is transactional in
nature, 87% of the Company's 1996 revenue was derived from clients for which
the Company provided services in previous years. The Company believes that its
strong client-service orientation, its focus on cross-selling its products and
services, and its development of strategic alliances with major users and
owners of real estate strengthen its client relationships and create recurring
revenue sources. The Company's revenue has increased at a compound rate of
17.7%, 12.4% and 14.2% for the three year, five year and ten year periods
ended December 31, 1996, respectively. In addition, the Company's wide range
of product and service offerings enabled the Company to maintain a stable
level of revenue from 1990 to 1993, the sharpest downturn in the real estate
markets in recent decades. None of the Company's clients accounted for 10% or
more of the Company's total revenue for 1994, 1995 or 1996.

The Company's operating expenses consist of compensation and benefits, other
operating and administrative expenses and depreciation and amortization.
Compensation and benefits tend to be relatively constant as a percentage of
revenue on an annual basis. Other operating and administrative expenses
consist principally of overhead costs and to a lesser extent business
development expenses, professional fees and employee training and development.
Overhead generally consists of occupancy costs and other routine business
expenses (i.e., office equipment, supplies and telecommunications) necessary
to conduct the Company's day-to-day operations. Overhead costs tend to be
relatively fixed, with increases occurring as the Company expands into new
geographic markets and as significant changes occur in staffing levels. The
remaining components of other operating and administrative expenses are
relatively variable. Depreciation and amortization has increased in recent
years due to the acquisitions of ABKB and CIN Property Management, increased
investment in technology and the Company's relocation of its Chicago
headquarters. Depreciation and amortization expenses will increase as a result
of the merger of Galbreath with the Company.

The Company receives investment advisory, property management and leasing
and investment banking fees for services provided in connection with four
multiple investor funds ("commingled funds") formed by the Company in the
1980s to hold real estate investments on behalf of numerous tax-exempt
institutional investors. Revenue derived from, or in connection with, these
funds represented 11.5% of the Company's total revenue in 1996 compared to
12.8% and 20.1% in 1995 and 1994, respectively. The Company expects that such
revenue

26
<PAGE>

will decrease and eventually be eliminated as the remaining assets of the funds
are sold. While the timing of the revenue loss will depend on the timing of the
dispositions, the Company expects to complete substantially all of such
dispositions prior to the end of 1998.

The Company is pursuing a strategy of selective acquisitions in order to
expand its capability to serve clients and strengthen its position as an
industry leader. As a result of the merger of Galbreath with the Company, the
Company added 71 million square feet to its property and facility management
portfolio, added new client relationships and expanded its market coverage.
Previously, with the acquisition of ABKB's real estate business in late 1994
and with the 1996 purchase of CIN Property Management, the Company added
approximately $5.3 billion to its assets under management, extended the
Company's securities advisory capabilities and established the Company as the
fourth largest manager of institutional real estate equity investments in the
United Kingdom.

As of March 31, 1997, the Company had a total net investment of $15.8 million
in 33 separate property or fund co-investments (which properties and funds had
a total acquisition cost exceeding $1.0 billion). Twenty-nine of these co-
investments were made in the last three years. The holding period for co-
investments typically ranges from three to seven years. Such co-investments are
typically represented by non-controlling general partner and limited partner
interests. The Company intends to use the increased financial flexibility
created by the Offering to expand its co-investment activities. The Company's
increased participation as a principal in real estate investments could
increase fluctuations in the Company's net earnings and cash flow as a result
of the timing and magnitude of the gains or losses and potential incentive
participation fees, if any, to be recognized on the disposition of the assets.
In certain of these investments, the Company will not have complete discretion
to control the timing of the disposition of such investments. Co-investment
also creates opportunities for the Company to provide services related to the
acquisition, financing, property management, leasing and disposition of such
investments.

PRO FORMA FINANCIAL INFORMATION

The Pro Forma Consolidated Financial Statements included elsewhere herein
give effect to, among other things, the merger of Galbreath with the Company,
the Incorporation Transactions and the Offering. See "Pro Forma Consolidated
Financial Statements."

PRO FORMA THREE MONTHS ENDED MARCH 31, 1997

On a pro forma basis, the Company's total revenue for the three months ended
March 31, 1997 was $43.4 million, compared to actual historical revenue of
$36.0 million. Pro forma total revenue of Galbreath includes fees generated
primarily from management services activities, such as property management and
leasing, facility management and development management assignments. Total
revenue of Galbreath also includes other income which consists of revenue
generated from the management of various insurance programs on behalf of
properties, investment income and other miscellaneous income.

Pro forma operating loss for the Company for the three months ended March 31,
1997 was $2.9 million compared to actual historical operating loss of $3.3
million. The decrease in operating loss on a pro forma basis is primarily the
result of the addition of $.9 million of pro forma Galbreath operating income,
including the effect of eliminating the net excess costs associated with
Galbreath's tenant representation and investment banking units which are being
disposed of or eliminated by the Company, partially offset by $.3 million of
amortization of management contracts and goodwill associated with the merger
and $.2 million of incremental expense associated with public ownership.

Pro forma net loss for the three months ended March 31, 1997 was $1.9
million, which reflects the decrease in operating loss, the Company's repayment
of indebtedness under the Dai-ichi Notes and the Long-Term Facility and the tax
effect as though the Company and Galbreath were taxable entities for the entire
period.

27
<PAGE>

PRO FORMA YEAR ENDED DECEMBER 31, 1996

On a pro forma basis, the Company's total revenue for 1996 was $207.6
million, compared to actual historical revenue of $176.0 million.

Pro forma operating income for the Company in 1996 was $30.2 million,
compared to actual historical operating income of $26.9 million. The increase
in operating income of the Company on a pro forma basis is primarily the result
of the addition of $5.4 million of pro forma Galbreath operating income,
including the effect of eliminating the net excess costs associated with
Galbreath's tenant representation and investment banking units which are being
disposed of or eliminated by the Company, offset by $1.3 million of
amortization of intangibles and goodwill associated with the merger and $.8
million of incremental expense associated with public ownership. Prior to the
merger with Galbreath, the Company's operating income as a percentage of total
revenue was 15.3%, compared to 14.5% on a pro forma basis. The decrease is
attributable to the amortization of goodwill and intangibles incurred in
connection with the merger of Galbreath with the Company. The Company believes
that potential synergies created by the merger will improve the operating
margin for the combined management services business. Such synergies are
expected to result primarily from eliminating infrastructure redundancies,
centralizing accounting and personnel functions and enhancing Galbreath's
management information systems.

Pro forma net income for 1996 was $17.9 million, reflecting the increase in
operating income, the Company's repayment of indebtedness under the Dai-ichi
Notes and the Long-Term Facility and the tax effect as though the Company and
Galbreath were taxable entities for the entire year.

The Galbreath combination is being treated for accounting purposes as a
purchase under Accounting Principles Board Opinion No. 16. The excess purchase
price over the fair value of the identifiable assets and liabilities acquired
was $29.6 million, of which $5.9 million was allocated to management contracts
and $23.7 million was allocated to goodwill. The amounts allocable to
management contracts and goodwill are being amortized on a straight-line basis
over 8 and 40 years, respectively, based on the Company's estimate of useful
lives.

28
<PAGE>

RESULTS OF OPERATIONS

The following unaudited table sets forth for the periods indicated the
percentage of total revenue represented by certain items reflected in the
Company's historical statement of earnings.

<TABLE>
<CAPTION>
THREE
MONTHS
YEAR ENDED ENDED MARCH
DECEMBER 31, 31,
------------------- -------------
1994 1995 1996 1996 1997
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
Revenue:
Management Services..................... 41.3% 40.7% 40.7% 44.0% 40.0%
Corporate and Financial Services........ 27.7 24.6 26.0 14.4 13.8
Investment Management................... 31.0 34.7 33.3 41.6 46.2
----- ----- ----- ----- -----
Total revenue......................... 100.0% 100.0% 100.0% 100.0% 100.0%
Operating expenses:
Compensation and benefits............... 61.6% 60.1% 59.5% 85.5% 75.6%
Other operating and administrative...... 22.0 23.9 22.2 29.5 28.6
Depreciation and amortization........... 2.2 2.8 3.0 4.1 4.9
----- ----- ----- ----- -----
Total operating expenses.............. 85.8% 86.8% 84.7% 119.1% 109.1%
Operating income (loss)................. 14.2% 13.2% 15.3% (19.1)% (9.1)%
Interest expense.......................... 4.1 2.5 3.3 3.4 4.7
----- ----- ----- ----- -----
Earnings (loss) before provision
(benefit) for income taxes........... 10.1% 10.7% 12.0% (22.5)% (13.8)%
Net provision (benefit) for income taxes.. 0.4 0.3 0.7 (1.3) (0.7)
----- ----- ----- ----- -----
Net earnings (loss)....................... 9.7% 10.4% 11.3% (21.2)% (13.1)%
===== ===== ===== ===== =====
</TABLE>

29
<PAGE>

The following unaudited tables summarize the revenue, operating expenses and
operating income by segment, and the percentage of segment revenue represented
by such items, for the years ended December 31, 1994, 1995 and 1996 and for the
three months ended March 31, 1996 and 1997.

<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH
YEAR ENDED DECEMBER 31, 31,
------------------------------------------------- -------------------------------
1994 1995 1996 1996 1997
--------------- --------------- --------------- -------------- --------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
MANAGEMENT SERVICES:
Segment revenue:
Property management
fees.................. $ 32,465 61.7% $ 34,017 53.8% $ 37,465 52.1% $ 7,774 64.2% 8,666 60.0%
Leasing fees........... 9,747 18.5 13,951 22.2 14,819 20.6 443 3.7 1,173 8.1
Facility management
fees.................. 6,222 11.8 10,477 16.6 13,639 19.0 2,698 22.3 3,417 23.7
Development management
fees.................. 3,557 6.8 3,125 4.9 5,465 7.6 1,038 8.6 1,115 7.7
Intersegment sales..... 160 0.3 1,370 2.2 200 0.3 100 0.8 25 0.2
Other income........... 466 0.9 212 0.3 281 0.4 60 0.4 47 0.3
-------- ----- -------- ----- -------- ----- ------- ----- ------- -----
$ 52,617 100.0% $ 63,152 100.0% $ 71,869 100.0% $12,113 100.0% $14,443 100.0%
Operating Expenses:
Compensation, benefits,
other operating and
administrative........ 46,267 87.9 50,859 80.5 59,486 82.8 13,392 110.6 15,849 109.7
Depreciation and
amortization.......... 1,076 2.0 1,202 1.9 1,651 2.3 337 2.8 512 3.5
-------- ----- -------- ----- -------- ----- ------- ----- ------- -----
Operating income
(loss)................ $ 5,274 10.1% $ 11,091 17.6% $ 10,732 14.9% $(1,616) (13.3%) (1,918) (13.3%)
======== ===== ======== ===== ======== ===== ======= ===== ======= =====
CORPORATE AND FINANCIAL
SERVICES:
Segment revenue:
Tenant representation
fees.................. $ 19,359 55.2% $ 23,037 61.8% $ 31,200 66.8% $ 2,881 73.7% $ 3,409 68.6%
Investment banking
fees.................. 9,432 26.9 6,908 18.5 6,664 14.3 293 7.5 612 12.3
Land fees.............. 4,300 12.2 3,675 9.8 4,938 10.6 298 7.6 707 14.2
Construction
operations, net....... 1,284 3.7 1,358 3.6 1,271 2.7 311 7.9 205 4.1
Equity in earnings from
unconsolidated
ventures.............. 476 1.4 2,171 5.9 1,380 3.0 89 2.3 -- 0.0
Intersegment sales..... 1,000 2.1 -- 0.0 -- 0.0
Other income........... 233 0.6 154 0.4 253 0.5 40 1.0 33 0.7
-------- ----- -------- ----- -------- ----- ------- ----- ------- -----
$ 35,084 100.0% $ 37,303 100.0% $ 46,706 100.0% $ 3,912 100.0% $ 4,966 100.0%
Operating expenses:
Compensation, benefits,
other operating and
administrative........ 27,463 78.3 28,604 76.7 34,831 74.6 7,038 179.9 8,764 176.5
Depreciation and
amortization.......... 845 2.4 890 2.4 1,055 2.3 218 5.6 218 4.4
-------- ----- -------- ----- -------- ----- ------- ----- ------- -----
Operating income
(loss)................ $ 6,776 19.3% $ 7,809 20.9% $ 10,820 23.1% $(3,344) (85.5%) $(4,016) (80.9%)
======== ===== ======== ===== ======== ===== ======= ===== ======= =====
INVESTMENT MANAGEMENT:
Segment revenue:
Advisory fees.......... $ 35,734 90.7% $ 45,117 85.5% $ 53,618 91.5% $11,004 96.9% $14,640 88.0%
Acquisition fees....... 2,944 7.5 6,411 12.2 2,939 5.0 305 2.7 505 3.0
Equity in earnings from
unconsolidated
ventures.............. 548 1.4 959 1.8 1,840 3.2 -- 0.0 1,394 8.4
Other income........... 151 0.4 255 0.5 195 0.3 51 0.4 96 0.6
-------- ----- -------- ----- -------- ----- ------- ----- ------- -----
$ 39,377 100.0% $ 52,742 100.0% $ 58,592 100.0% $11,360 100.0% $16,635 100.0%
Operating expenses:
Compensation, benefits,
other operating and
administrative........ 32,482 82.5 49,378 93.6 50,533 86.2 11,049 97.3 12,929 77.7
Depreciation and
amortization.......... 930 2.4 2,148 4.1 2,710 4.6 556 4.9 1,044 6.3
-------- ----- -------- ----- -------- ----- ------- ----- ------- -----
Operating income
(loss)................ $ 5,965 15.1% $ 1,216 2.3% $ 5,349 9.2% $ (245) (2.2%) $ 2,662 16.0%
======== ===== ======== ===== ======== ===== ======= ===== ======= =====
Total segment revenue... $127,078 $153,197 $177,167 $27,385 $36,044
Intersegment revenue
eliminations........... (160) (1,370) (1,200) (100) (25)
-------- -------- -------- ------- -------
Total revenue.......... $126,918 $151,827 $175,967 $27,285 $36,019
======== ======== ======== ======= =======
Total segment operating
expenses............... $109,063 $133,081 $150,266 $32,590 $39,316
Intersegment operating
expenses............... (160) (1,370) (1,200) (100) (25)
-------- -------- -------- ------- -------
Total operating
expenses.............. $108,903 $131,711 $149,066 $32,490 $39,291
======== ======== ======== ======= =======
Total operating income
(loss)................ $ 18,015 $ 20,116 $ 26,901 $(5,205) $(3,272)
======== ======== ======== ======= =======
</TABLE>

30
<PAGE>

THREE MONTHS ENDED MARCH 31, 1997 COMPARED TO THREE MONTHS ENDED MARCH 31,
1996

CONSOLIDATED RESULTS
Total Revenue. The Company's total revenue grew $8.7 million, or 32.0%, to
$36.0 million for the three months ended March 31, 1997 from $27.3 million in
the prior year period. The increase is attributable to the continued
improvement in real estate market conditions, the acquisition of CIN Property
Management in October 1996 and the increase in co-investments.

Operating Expenses. The Company's operating expenses grew $6.8 million, or
20.9%, to $39.3 million for the three months ended March 31, 1997 from $32.5
million in the prior year period. The increase is primarily attributable to
the acquisition of CIN Property Management, increased staffing levels and
higher compensation and benefits generally as a result of anticipated
transactions. As a percentage of total revenue, operating expenses declined to
109.1% for the three months ended March 31, 1997 from 119.1% in the prior year
period.

Operating Income (Loss). The Company typically incurs a loss in the first
quarter of the calendar year. For the three months ended March 31, 1997, the
Company's operating loss decreased $1.9 million to $3.3 million from $5.2
million in the prior year period. The decrease is primarily attributable to
the earnings associated with the acquisition of CIN Property Management and
equity earnings generated from co-investments with which additional
compensation costs are not associated. As a percentage of total revenue, the
operating loss decreased to 9.1% for the three months ended March 31, 1997
from 19.1% in the prior year period.

Interest Expense. Interest expense increased $.8 million, or 80.9%, to $1.7
million in 1997 from $.9 million in 1996. The increase is substantially a
result of increased borrowings under the Long-Term Facility to fund the CIN
Property Management acquisition, technology and infrastructure investments and
co-investments.

Provision (Benefit) for Income Taxes. The benefit for income taxes decreased
by $.1 million to $.2 million in 1997 from $.4 million in 1996.

Net Earnings (Loss). The Company's net loss decreased $1.1 million, or
18.5%, to $4.7 million in 1997 from $5.8 million in 1996.

SEGMENT OPERATING RESULTS
Management Services. The Management Services segment's revenue, which
represented 40.0% of the Company's total revenue for the three months ended
March 31, 1997, increased $2.3 million, or 19.2%, to $14.4 million from $12.1
million in the prior year period. The increase was due to a $.9 million
increase in property management fees and $.7 million increase in leasing fees
as a result of the net addition of 4.5 million square feet of new property
management assignments. In addition, facility management fees increased $.7
million as a result of an increase of one million square feet of property
under management in the fourth quarter of 1996.

Operating expenses increased $2.6 million, or 19.2%, to $16.4 million for
the three months ended March 31, 1997 from $13.7 million in the prior year
period. The increase is primarily attributable to increased compensation,
relocation, travel and marketing expenses associated with the national leasing
and business development group established in the second half of 1996 as well
as increased staffing levels to manage the additional property and facility
management assignments.

The Management Services segment's operating loss increased $.3 million, or
18.7%, to $1.9 million for the three months ended March 31, 1997 from $1.6
million in the prior year period. As a percentage of revenue, Management
Services' operating loss remained constant at 13.3% for the three months ended
March 31, 1997 compared to the prior year period.

Corporate and Financial Services. The Corporate and Financial Services
segment's revenue, which represented 13.8% of the Company's total revenue for
the three months ended March 31, 1997, increased

31
<PAGE>

$1.1 million, or 26.9%, to $5.0 million for the three months ended March 31,
1997 from $3.9 million in the prior year period. The increase is attributable
to an increased number of transactions in the tenant representation,
investment banking and land units.

Operating expenses for the Corporate and Financial Services segment
increased $1.7 million, or 23.8%, to $9.0 million for the three months ended
March 31, 1997 from $7.3 million in the prior year period. The increase in
operating expenses primarily represents increased staffing levels in the
Company's tenant representation unit in addition to increased marketing
efforts by the investment banking unit.

The Corporate and Financial Services segment's operating loss increased $.7
million, or 20.1%, to $4.0 million for the three months ended March 31, 1997
from $3.3 million in the prior year period. The revenue of the Corporate and
Financial Services segment are heavily weighted to the fourth quarter of the
year with operating expenses generally spread evenly throughout the year in
accordance with GAAP. As a percentage of segment revenue, the operating loss
decreased to 80.9% in 1997 from 83.0% in 1996.

Investment Management. The Investment Management segment's revenue, which
represented 46.2% of the Company's total revenue for the three months ended
March 31, 1997, increased $5.3 million, or 46.4%, to $16.6 million for the
three months ended March 31, 1997 from $11.4 million in the prior year period.
The increase is primarily attributable to the earnings associated with the
acquisition of CIN Property Management which had revenue of $3.5 million in
1997, as well as to equity earnings recognized on $7.9 million of net
additional co-investments at March 31, 1997.

Operating expenses increased $2.4 million, or 20.4%, to $14.0 million for
the three months ended March 31, 1997 from $11.6 million in the prior year
period. The increase is primarily attributable to the additional compensation
and other direct operating expenses associated with the acquisition of CIN
Property Management totaling $2.8 million offset by a slight decrease in
staffing in other units within the Investment Management segment.

Operating income was $2.7 million for the three months ended March 31, 1997
compared to an operating loss of $.2 million for the prior year period. The
increase is attributable to the net income generated from CIN Property
Management in addition to equity earnings on co-investments for which
compensation and other operating costs are not incurred. As a percentage of
segment revenue, operating income increased to 16.0% for the three months
ended March 31, 1997 from a negative 2.2% in the prior year period.

YEAR ENDED DECEMBER 31, 1996 COMPARED TO YEAR ENDED DECEMBER 31, 1995

CONSOLIDATED RESULTS
Total Revenue. The Company's total revenue grew $24.1 million, or 15.9%, to
$176.0 million in 1996 from $151.8 million in 1995. In general, the strong
United States economy in 1996 and a lack of new construction since the early
1990s have resulted in tightening supplies and rising rental rates for
commercial real estate in the United States. Accordingly, the amount of public
and private capital invested in commercial real estate generally has increased
with improving market conditions. These conditions have resulted in revenue
growth for all three of the Company's business segments. None of the Company's
clients accounted for 10% or more of the Company's total revenue in 1996.

Operating Expenses. The Company's operating expenses increased $17.4
million, or 13.2%, to $149.1 million in 1996 from $131.7 million in 1995. The
increase in operating expenses generally reflected higher levels of
compensation and benefits associated with increased staffing and higher
incentive compensation associated with the Company's increased revenue. In
addition, depreciation and amortization expenses increased $1.2 million, or
27.7%, primarily as a result of amortization of goodwill and other intangibles
associated with the acquisition of CIN Property Management in October 1996
(which are being amortized over five to 20 years) and depreciation expense
associated with the Company's investment in technology-related assets and the
relocation of its corporate headquarters. As a percentage of total revenue,
operating expenses declined to 84.7% in 1996 from 86.8% in 1995, primarily
reflecting the relatively fixed nature of certain administrative expenses as
well as

32
<PAGE>

the impact in 1995 of the $1.9 million provision for the estimated
uncollectible portion of a receivable from Diverse Real Estate Holdings
Limited Partnership ("Diverse"). See "Certain Relationships and Related
Transactions."

Operating Income. Based on the factors noted above, the Company's operating
income increased $6.8 million, or 33.7%, to $26.9 million in 1996 from $20.1
million in 1995. As a percentage of total revenue, operating income increased
to 15.3% in 1996 from 13.2% in 1995.

Interest Expense. Interest expense increased $1.9 million, or 50.6%, to $5.7
million in 1996 from $3.8 million in 1995, principally as a result of
increased borrowings under the Long-Term Facility to fund the CIN Property
Management acquisition, technology and infrastructure investments and co-
investments.

Provision for Income Taxes. Provision for income taxes increased $.7
million, or 139%, to $1.2 million in 1996 from $.5 million in 1995, due to an
increased volume of transactions performed in jurisdictions with higher state
taxes and increased foreign taxes paid in connection with international
operations.

Net Earnings. Net earnings increased $4.2 million, or 26.3%, to $20.0
million in 1996 from $15.8 million in 1995. Net earnings in 1996 represented
11.3% of total revenue, compared with 10.4% in the previous year.

SEGMENT OPERATING RESULTS
Management Services. The Management Services segment's revenue, which
represented approximately 40.7% of the Company's total revenue in 1996,
increased $8.7 million, or 13.8%, to $71.9 million in 1996 from $63.2 million
in 1995. This increase was primarily due to a $4.3 million increase in
property management and leasing fees and a $3.2 million increase in facility
management revenue. Property management and leasing fees increased as a result
of the net addition of approximately six million square feet of new property
management and leasing assignments in 1996 and, to a lesser extent, rising
rental rates for office buildings generally. The increase in facility
management fees was principally due to the initiation of a major new facility
management assignment and increased incentive-based fees related to cost
savings achieved for facility management accounts added in prior years. The
Company's property management and leasing revenue was impacted by a $.6
million decline in revenue related to the sale of certain commingled fund
properties. Total revenue from property management and leasing services
provided to commingled fund properties in 1996 was $11.9 million compared to
$12.5 million in 1995.

Operating expenses increased $9.1 million, or 17.4%, to $61.1 million in
1996 from $52.1 million in 1995 as a result of increased staffing levels to
meet the demands associated with an expansion of square feet under management.
In addition, the segment incurred approximately $2.0 million of incremental
expenses associated with an increased commitment of senior personnel to the
national leasing effort. This effort included an expansion in selected
regional markets resulting in approximately $1.0 million of relocation and
recruiting costs. The segment also incurred approximately $.7 million in
consulting fees to enhance client service and information reporting for
property management assignments and in training costs expended on new
technology implemented in 1996 regarding tenant request and other systems.
Operating income decreased by $.4 million, or 3.2%, to $10.7 million in 1996
from $11.1 million in 1995. The Management Services segment's operating income
represented 39.9% of the Company's total operating income in 1996. As a
percentage of segment revenue, operating income decreased to 14.9% in 1996
from 17.6% in 1995.

Corporate and Financial Services. The Corporate and Financial Services
segment's revenue, which represented about 26.5% of the Company's total
revenue in 1996, increased $9.4 million, or 25.2%, to $46.7 million in 1996
from $37.3 million in 1995. This record revenue resulted primarily from an
$8.2 million increase in revenue from the Company's tenant representation
business. A number of significant tenant representation transactions and a
series of transactions generated from a new facility management client
accounted for the majority of the increased tenant representation revenue. The
tenant representation business completed 256 transactions totaling over 6.7
million square feet in 1996 compared to 132 transactions and 3.6 million
square feet in 1995. General improvements in real estate market fundamentals,
including declining vacancies in Class A buildings and increases in office
rents, have prompted several of the Company's clients to complete large

33
<PAGE>

relocations or lease extensions. Approximately 79% of tenant representation
revenue in 1996 was generated from strategic alliances with large corporations
or professional service firms.

Operating expenses for the Corporate and Financial Services segment
increased $6.4 million, or 21.7%, to $35.9 million in 1996 from $29.5 million
in 1995, principally as a result of higher staffing levels to meet the higher
levels of activity throughout the year and as a result of increased incentive
compensation earned by employees. The Corporate and Financial Services
segment's operating income, which represented 40.2% of the Company's total
operating income in 1996, increased $3.0 million in 1996, or 38.6%, to $10.8
million in 1996 from $7.8 million in 1995. As a percentage of segment revenue,
operating income increased to 23.1% in 1996 from 20.9% in 1995.

Investment Management. The Investment Management segment's revenue, which
represented 33.3% of the Company's total revenue in 1996, increased $5.9
million, or 11.1%, to $58.6 million in 1996 from $52.7 million in 1995. The
net gain in revenue was primarily attributable to growth in the Company's
European advisory business resulting from the CIN Property Management
acquisition in October 1996, and, to a lesser extent, the increase in assets
under management from the Company's co-investment activities and the Company's
securities advisory business. Strong fundamentals in the publicly traded real
estate securities markets during 1996, and the resulting capital inflows to
this sector, contributed to the growth in the Company's securities advisory
business.

Revenue was negatively impacted by a $1.0 million decline in investment
management fees from the Company's four large commingled funds in 1996, as a
result of the sale of several commingled fund assets during the year. The
funds had a net asset value of $726 million at the end of 1996, compared to
$983 million at the end of 1995. Investment Management segment revenue from
these funds, which totaled $5.9 million in 1996, will continue to decline as
substantially all of the remaining properties are expected to be sold by the
end of 1998.

Operating expenses increased $1.7 million, or 3.3%, to $53.2 million in 1996
from $51.5 million in 1995. The increase is primarily attributable to
additional operating expenses and amortization of goodwill and intangible
assets associated with the acquisition of CIN Property Management totaling
$2.6 million and, to a lesser extent, to employee relocation costs totaling
$1.2 million. The 1996 increase in expenses was offset by $2.0 million in
certain one-time expenses incurred in 1995 related to the reorganization of
this segment.

Operating income, which represented 19.9% of the Company's total operating
income in 1996, increased $4.1 million to $5.3 million in 1996 from $1.2
million in 1995. As a percentage of segment revenue, operating income
increased to 9.2% in 1996 from 2.3% in 1995.

34
<PAGE>

YEAR ENDED DECEMBER 31, 1995 COMPARED TO YEAR ENDED DECEMBER 31, 1994

CONSOLIDATED RESULTS
Total Revenue. Total revenue increased $24.9 million, or 19.6%, to $151.8
million in 1995 from $126.9 million in 1994. The revenue increase resulted
from the full year effect of the acquisition of ABKB's securities and advisory
business in late 1994 and from revenue growth in the Management Services
segment's leasing and facility management activities. The Company's revenue
growth also reflected improvements in both general economic conditions and in
real estate industry fundamentals.

Operating Expenses. The Company's operating expenses increased $22.8
million, or 20.9%, to $131.7 million in 1995 from $108.9 million in 1994. As a
percentage of total revenue, operating expenses increased to 86.8% in 1995
from 85.8% in 1994. The increase in operating expenses was attributable
primarily to a $13.1 million increase in compensation and benefits expenses,
an $8.3 million increase in other operating and administrative expenses and,
to a lesser extent, a $1.4 million increase in depreciation and amortization
expense. The increase in compensation and benefits expenses reflected the
effect of the ABKB acquisition in late 1994 and higher levels of employee
incentive compensation associated with certain segments exceeding their
operating income objectives. The increase in other operating and
administrative expenses was primarily attributable to the effect of the ABKB
acquisition and, to a lesser extent, to certain one-time costs and the $1.9
million provision for the uncollectible portion of the Company's long-term
receivable from Diverse. The increase in depreciation and amortization expense
principally resulted from the full-year effect of the amortization of the
intangible assets arising from the acquisition of ABKB in late 1994. The $9.4
million in intangibles recognized in that transaction are being amortized over
a 10 year period. In 1994, operating expenses included a $4.2 million charge
related to the commitment to relocate the Company's headquarters, which charge
was allocated to all of the Company's business segments, principally on a
head-count basis.

Operating Income. Operating income increased $2.1 million, or 11.7%, to
$20.1 million in 1995 from $18.0 million in 1994. As a result of the factors
noted above, as a percentage of total revenue, operating income represented
13.2% in 1995 compared to 14.2% in 1994.

Interest Expense. Interest expense declined to $3.8 million in 1995 from
$5.2 million in 1994 and is substantially attributable to the $14.1 million
principal payment made on the Dai-ichi Notes in late 1994.

Net Earnings. Net earnings increased $3.5 million, or 28.5%, to $15.8
million in 1995 from $12.3 million in 1994. Net earnings represented 10.4% of
total revenue, compared with 9.7% in 1994.

SEGMENT OPERATING RESULTS
Management Services. The Management Services segment's revenue, which
represented 40.7% of the Company's total revenue in 1995, increased $10.5
million, or 20.0%, to $63.2 million in 1995 from $52.6 million in 1994.
Facility management revenue increased $4.3 million as the Company obtained
over 17.0 million square feet of new assignments. Improving leasing markets
drove leasing revenue to record levels in 1995, with leasing revenue
increasing $4.2 million over 1994 levels. Property management fees also
increased $1.6 million to $34.0 million, principally as a result of new
assignments.

Operating expenses increased $4.7 million, or 10.0%, to $52.1 million in
1995 from $47.3 million in 1994, primarily as a result of increased staffing
levels to support new assignments in addition to expanded marketing costs
associated with promoting the Company's facilities management initiative. As a
percentage of revenue, operating expenses decreased to 82.4% in 1995 from
89.9% in 1994 primarily as a result of higher than normal corporate overhead
expenses incurred in 1994 as a result of the Management Services segment's
allocation of the headquarters relocation charge. The Management Services
segment's operating income, which represented 55.1% of the Company's total
operating income in 1995, increased $5.8 million, or 110%, to $11.1 million in
1995 from $5.3 million in 1994. As a percentage of segment revenue, operating
income increased to 17.6% in 1995 from 10.0% in 1994.

35
<PAGE>

Corporate and Financial Services. The Corporate and Financial Services
segment's revenue, which represented approximately 24.6% of the Company's
total revenue in 1995, increased $2.2 million, or 6.3%, to $37.3 million in
1995 from $35.1 million in 1994. The revenue growth resulted from $3.7 million
of increased revenue from tenant representation activities. The tenant
representation business completed 132 transactions totaling 3.6 million square
feet in 1995, compared with 98 transactions totaling 3.8 million square feet
in 1994. Although the total square footage of transactions in 1995 was
slightly less than in 1994, revenue per square foot increased due to a
concentration of activity in cities with higher average rents. Revenue gains
were offset principally by decreased revenue from its investment banking
activities. The reduction in the Company's investment banking revenue was
primarily attributable to senior personnel being dedicated to the development
of new products and initiatives in 1995, including CMBS and hotel investments,
rather than new business development.

Operating expenses increased $1.2 million, or 4.2%, to $29.5 million in 1995
from $28.3 million in 1994. As a percentage of revenue, operating expenses
represented 79.1% in 1995 compared to 80.7% in 1994. The 1994 operating
expenses for this segment were adversely affected by the one-time allocation
of the headquarters relocation charge. The Corporate and Financial Services
segment's operating income, which represented 38.8% of the Company's total
operating income in 1995, increased $1.0 million in 1995, or 15.2%, to $7.8
million in 1995 from $6.8 million in 1994. The increase was a result of the
strengthening of the real estate market, increased tenant representation fees
and the investment in a commercial land and residential development entity. As
a percentage of segment revenue, operating income increased to 20.9% in 1995
from 19.3% in 1994.

Investment Management. The Investment Management segment's revenue, which
represented 34.7% of the Company's total revenue in 1995, increased $13.4
million, or 33.9%, to $52.7 million in 1995 from $39.4 million in 1994. The
substantial majority of the increase in revenue was associated with the ABKB
acquisition, partially offset by a $7.0 million decrease in commingled fund
revenue. This decline in commingled fund revenue was primarily attributable to
the voluntary reduction in fees in 1995, as well as sales of real estate
assets held by such funds. In addition, as a result of the downturn in real
estate markets, commingled fund advisory fees, which are calculated as a
percentage of real estate net asset value ("NAV"), declined because of such
reductions in property NAVs.

Operating expenses increased $18.1 million, or 54.2%, to $51.5 million in
1995 from $33.4 million in 1994. The substantial majority of the increase is
associated with the ABKB acquisition and the amortization of the related
goodwill and intangible assets in addition to certain one-time expenses
incurred in 1995 totaling $2.0 million related to the restructuring of this
segment. As a percentage of revenue, operating expenses increased to 97.7% in
1995 from 84.9% in 1994. The Investment Management segment's operating income,
which represented 6.0% of the Company's total operating income in 1995,
decreased $4.7 million to $1.2 million in 1995 from $6.0 million in 1994. As a
percentage of segment revenue, operating income decreased to 2.3% in 1995 from
15.1% in 1994.

36
<PAGE>

QUARTERLY RESULTS OF OPERATIONS

The following table sets forth certain unaudited combined statements of
operations data for each of the Company's last nine quarters. In the opinion
of management, this information has been presented on the same basis as the
audited financial statements appearing elsewhere in this Prospectus, and
includes all adjustments, consisting only of normal recurring adjustments and
accruals, that the Company considers necessary for a fair presentation. The
unaudited combined quarterly information should be read in conjunction with
the Predecessor Partnerships' Combined Financial Statements and the notes
thereto. The operating results for any quarter are not necessarily indicative
of the results for any future period.

<TABLE>
<CAPTION>
1995 1996 1997
------------------------------------ ------------------------------------ --------
MARCH 31 JUNE 30 SEPT. 30 DEC. 31 MARCH 31 JUNE 30 SEPT. 30 DEC. 31 MARCH 31
-------- ------- -------- ------- -------- ------- -------- ------- --------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
REVENUE(1):
Management Services..... $11,782 $13,777 $13,697 $22,526 $12,013 $15,332 $18,484 $25,840 $14,418
Corporate and Financial
Services............... 3,302 6,336 9,880 17,785 3,912 6,933 8,712 26,149 4,966
Investment Management... 11,336 12,693 13,105 15,608 11,360 12,466 11,979 22,787 16,635
------- ------- ------- ------- ------- ------- ------- ------- -------
Total revenue........... $26,420 $32,806 $36,682 $55,919 $27,285 $34,731 $39,175 $74,776 $36,019
OPERATING EXPENSES:
Compensation and
benefits............... $21,489 $22,352 $22,145 $25,197 $23,327 $24,346 $24,995 $32,005 $27,217
Other operating and
administrative (1)..... 7,083 8,702 8,467 12,036 8,052 8,831 10,088 12,006 10,300
Depreciation and
amortization........... 1,003 1,057 1,052 1,128 1,111 1,134 1,169 2,002 1,774
------- ------- ------- ------- ------- ------- ------- ------- -------
Operating income (loss). $(3,155) $ 695 $ 5,018 $17,558 $(5,205) $ 420 $ 2,923 $28,763 $(3,272)
Interest expense........ 941 948 959 958 937 1,104 1,944 1,745 1,695
Income tax provision
(benefit).............. (127) (8) 126 514 (350) (39) 56 1,540 (248)
------- ------- ------- ------- ------- ------- ------- ------- -------
Net earnings (loss)..... $(3,969) $ (245) $ 3,933 $16,086 $(5,792) $ (645) $ 923 $25,478 $(4,719)
======= ======= ======= ======= ======= ======= ======= ======= =======
EBITDA(2)............... $(2,152) $ 1,752 $ 6,070 $18,686 $(4,094) $ 1,554 $ 4,092 $30,765 $(1,498)
Net cash provided by
(used in) operating.... (8,926) 3,429 10,543 8,507 (12,721) 7,639 1,863 17,183 (4,678)
Net cash provided by
(used in) investing.... (695) (2,266) (1,629) (1,116) (5,967) (3,139) (2,678) (20,694) (2,038)
Net cash provided by
(used in) financing.... 2,349 (1,970) (8,644) (4,100) 14,921 (4,432) 1,099 5,601 7,705
</TABLE>

The following table sets forth the above quarterly financial information as
a percentage of total revenue:

<TABLE>
<CAPTION>
1995 1996 1997
----------------------------------- ----------------------------------- --------
MARCH 31 JUNE 30 SEPT. 30 DEC. 31 MARCH 31 JUNE 30 SEPT. 30 DEC. 31 MARCH 31
-------- ------- -------- ------- -------- ------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
REVENUE(1):
Management Services..... 44.6% 42.0% 37.3% 40.3% 44.0% 44.1% 47.2% 34.6% 40.0%
Corporate and Financial
Services............... 12.5 19.3 26.9 31.8 14.4 20.0 22.2 35.0 13.8
Investment Management... 42.9 38.7 35.7 27.9 41.6 35.9 30.6 30.4 46.2
----- ----- ----- ----- ----- ----- ----- ----- -----
Total revenue........... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
OPERATING EXPENSES:
Compensation and
benefit................ 81.3% 68.1% 60.4% 45.1% 85.5% 70.1% 63.8% 42.8% 75.6%
Other operating and
administrative (1)..... 26.8 26.5 23.1 21.5 29.5 25.4 25.7 16.0 28.6
Depreciation and
amortization........... 3.8 3.2 2.9 2.0 4.1 3.3 3.0 2.7 4.9
----- ----- ----- ----- ----- ----- ----- ----- -----
Operating income (loss). (11.9)% 2.1% 13.7% 31.4% (19.1)% 1.2% 7.5% 38.5% (9.1)%
Interest expense........ 3.6 2.9 2.6 1.7 3.4 3.2 5.0 2.3 4.7
Income tax provision
(benefit).............. (0.5) 0.0 0.3 0.9 (1.3) (0.1) 0.1 2.1 (0.7)
----- ----- ----- ----- ----- ----- ----- ----- -----
Net earnings (loss)..... (15.0)% (0.7)% 10.7% 28.8% (21.2)% (1.9)% 2.4% 34.1% (13.1)%
===== ===== ===== ===== ===== ===== ===== ===== =====
EBITDA (2).............. (8.1)% 5.3% 16.5% 33.4% (15.0)% 4.5% 10.4% 41.1% (4.2)%
</TABLE>
- --------
(1)Excludes intersegment revenue and intersegment expense.

(2) EBITDA represents earnings before interest, income taxes, depreciation and
amortization, thereby removing the effect of certain non-cash charges on
income, such as the amortization of intangible assets relating to
acquisitions. Management believes that EBITDA is useful to investors
because it is widely used in the real estate industry as a recognized
measure of operating performance, cash generation and ability to service
debt and is also used by analysts who report publicly on the performance
of real estate services companies. However, EBITDA should not be
considered as an alternative either to: (i) net earnings (determined in
accordance with GAAP); (ii) operating cash flow (determined in accordance
with GAAP); or (iii) liquidity. There can be no assurance that the
Company's calculation of EBITDA is comparable to similarly titled items
reported by other companies.

37
<PAGE>

Segment Revenue. A substantial majority of Management Services revenue
reflects property and facility management fees earned evenly throughout the
year. However, fourth quarter revenue is generally higher due to higher levels
of leasing fees earned in the fourth quarter as well as incentive fees earned
under performance-based agreements. Corporate and Financial Services revenue
has historically increased from quarter to quarter in a given year with the
largest proportion of transactions being completed in the fourth quarter,
consistent with the industry. Investment Management revenue is generally
earned evenly throughout the year with the fourth quarter 1996 revenue
reflective of the CIN Property Management acquisition in October 1996.

Operating Expenses. Bonus accruals are recorded quarterly on the basis of
the progress toward achievement of revenue targets. Consequently, fourth
quarter compensation and benefit expenses track the higher level of revenue
generated in the fourth quarter. Other operating and administrative expenses
are generally relatively consistent throughout the year.

LIQUIDITY AND CAPITAL RESOURCES

Net cash flows used in operations totaled $4.7 million for the three months
ended March 31, 1997 compared to $12.7 million for the prior year period. Net
cash flows provided by operations totaled $14.0 million, $13.6 million and
$24.6 million for the years ended December 31, 1996, 1995 and 1994,
respectively. The primary element of change for the three months ended March
31, 1997 and in the years 1996 through 1994 is the increase in receivables,
which can be attributed to the significant increase in leasing commissions
generated in the fourth quarter of each year for both the Management Services
and Corporate and Financial Services segments. Fees recognized from lease
transactions are typically collected half when the lease is executed and half
when the space is occupied with occupancy generally occurring between six and
12 months after the lease execution. These increases have been partially
offset by steady increases in accounts payable and accrued compensation which
is also attributable to the increase in fourth quarter revenue generation.

Since 1993, the Company has invested or committed approximately $30 million
(which has been reduced by approximately $16.3 million through subsequent
dispositions of a portion of these investments and through sales of
participations in these investments to employees and others) in over 30
separate properties or funds. In addition to its share of investment returns,
the Company typically earns property management, leasing, and advisory fees on
these investments. The equity earnings from these co-investments have had a
relatively small impact on the Company's current earnings and cash flow.
However, this impact will increase as such existing co-investments are sold
over the next several years, and as the Company's co-investment activity
accelerates following the Offering.

Net cash used in investing activities was $2.0 million for the three months
ended March 31, 1997 compared to $6.0 million for the prior year period. The
reduction in net cash used in investing activities is a result of $.9 million
of distributions from real estate investments and a decrease of $4.1 million
in capital investments over the prior year period offset by an increase in
capital contributions of $1.1 million to real estate ventures. Net cash used
in investing activities was $32.5 million in 1996, compared to $5.7 million in
1995. The increase was attributable to the acquisition of CIN Property
Management for $15.7 million, as well as increases in co-investment activity,
expenditures on furniture and fixtures at the Company's new corporate
headquarters and increased investments in technology. Net cash used in
investing activities was $5.7 million in 1995, compared to $4.9 million in
1994. Net co-investment activity in 1995 was $2.0 million lower than in the
prior year; however, capital investments in technology in 1995 were $2.8
million higher than in 1994. As of March 31, 1997, the Company had unfunded
commitments for existing co-investments of $1.1 million.

Historically, the Company has financed its operations, acquisitions and co-
investments with internally generated funds, partnership equity and borrowings
under revolving credit facilities. In September 1996, the Company replaced its
$30 million revolving line of credit with a $70 million credit agreement
terminating on September 6, 1999. The agreement consists of a short-term
facility (the "Short-Term Facility") and the Long-Term Facility totaling $30
million and $40 million, respectively. The agreement is secured by certain of
the Company's receivables, fixed assets and investments in ventures. The
agreement requires that the Company

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maintain a certain level of net worth and meet earnings before interest,
taxes, depreciation and amortization targets. The Company is further
prohibited, without the lenders' prior approval, from incurring certain
indebtedness (including certain levels of indebtedness in connection with co-
investments), guaranteeing certain obligations or disposing of a significant
portion of its assets. The facilities bear variable rates of interest based on
market rates. The Company expects to renegotiate the terms of the Short-Term
Facility and Long-Term Facility in connection with the assumption of such
indebtedness by the Company in the Incorporation Transactions.

The Short-Term Facility is a revolving line of credit which must be paid
down annually for a 30-consecutive-day period and is restricted as to use for
general business purposes. Amounts outstanding on the Short-Term Facility at
March 31, 1997 totaled $16.8 million. The Long-Term Facility is limited in use
to investments in real estate ventures, business acquisitions and certain
capital expenditures, subject to lender approval. Principal payments on
borrowings under the Long-Term Facility are payable annually on June 15 for
amounts outstanding as of March 31 based on a defined amortization schedule.
Principal payments made on June 15 of each year increase the available balance
on the facility from which to borrow. Amounts outstanding on the Long-Term
Facility as of March 31, 1997 totaled $29.2 million.

At March 31, 1997, the Company also had outstanding $37.2 million in
subordinated debt owed to affiliates of Dai-ichi in the form of $6.2 million
in Class A Notes and $31 million in Class B Notes (the "Dai-ichi Notes"), each
bearing interest at 10% payable annually on December 31st. Principal payments
on the Class A Notes are $3.1 million due on June 30, 1997 and 1998. Principal
payments on the Class B Notes are due in ten equal payments of $3.1 million on
June 30th of each year beginning in 1999. The Notes are prepayable without
penalty. In 1994, a principal repayment of $14.1 million was made on the Class
A Notes with capital contributions received in connection with the ABKB
acquisition.

Net cash provided by financing activities was $7.7 million for the three
months ended March 31, 1997 compared to $14.9 million for the prior year
period. The change is primarily attributable to the increased cash flow
provided by operations resulting in a decrease in borrowing needs. Net cash
provided by (used in) financing activities was $17.2 million in 1996, compared
to ($12.4) million in 1995. Borrowings under the Long-Term Facility in 1996
were used to fund the acquisition of CIN Property Management, the increase in
co-investment activity, and infrastructure investments. Net cash used in
financing activities was $12.4 million in 1995, compared to $12.0 million in
1994. Distributions to partners increased by $3.0 million in 1995, compared to
1994.

Upon completion of the Offering, the Company intends to repay the full
amount of the indebtedness outstanding under the Dai-ichi Notes. The remaining
proceeds will be used to repay the indebtedness outstanding under the Long-
Term Facility. After the existing long-term debt is paid, the Company plans to
increase its long-term debt periodically in order to continue to pursue
international expansion, strategic acquisitions and co-investments. The
Company believes, based on its current operating plans, that cash generated
from operations, the net proceeds of the Offering and available borrowings
will be sufficient to meet its capital and liquidity requirements. See "Use of
Proceeds."

DISPOSITION

On December 31, 1996, the Company completed the sale of its construction
management business to a former member of the Company's management. This
business, which specializes in the interior build-out of office and retail
space for tenants in the Chicago and Los Angeles markets, had 1996 revenue,
which are shown net of related expenses on the Company's combined statements
of earnings, of $1.3 million. The business was sold in exchange for a note of
$9.1 million. The note, which is secured by the current and future assets of
the business, is due December 31, 2006. For financial reporting purposes, the
Company has not treated the transaction as a divestiture. Principal and
interest to be received under the note will be treated as a reserve, if
necessary, for any anticipated financial exposure under the terms of the asset
purchase agreement, with the remainder recognized as income as principal and
interest payments are received.

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SEASONALITY

Historically, the Company's revenue, operating income and net earnings in the
first three calendar quarters are substantially lower than in the fourth
quarter. This seasonality is due to a calendar year-end focus on the completion
of transactions, which is consistent with the real estate industry generally.
In addition, an increasing percentage of the Company's management contracts
contain clauses providing for performance bonuses to be received if the Company
achieves certain performance targets. Such incentive payments are generally
earned in the fourth quarter. In contrast, the Company's non-variable operating
expenses, which are treated as expenses when incurred during the year, are
relatively constant on a quarterly basis. Therefore, the Company typically
sustains a loss in the first and second quarter of each calendar year, reports
a small profit or loss in the third quarter and records a substantial majority
of the Company's earnings in the fourth calendar quarter. See "--Quarterly
Results of Operations."

INFLATION

The Company's operations are directly affected by various national and
economic conditions, including interest rates, the availability of credit to
finance real estate transactions and the impact of tax laws. To date, the
Company does not believe that general inflation has had a material impact on
its operations, as revenue, commissions and other variable costs related to
revenue are primarily impacted by real estate supply and demand rather than
general inflation.

OTHER MATTERS

In connection with the Offering and the Incorporation Transactions, the
Company will become subject to Federal and additional state and local income
taxes as it converts from partnership to corporate form. Concurrently with the
Incorporation Transactions, the Company will record deferred tax assets and
liabilities in accordance with the provisions of SFAS No. 109. Such amounts are
not expected to have a material effect on the Company's Pro Forma Consolidated
Financial Statements.

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BUSINESS

COMPANY OVERVIEW

LaSalle Partners is a leading full-service real estate firm that provides
management services, corporate and financial services and investment
management services to corporations and other real estate owners, users and
investors worldwide. By offering a broad range of real estate products and
services, and through its extensive knowledge of domestic and international
real estate markets, the Company is able to serve as a single source provider
of solutions for its clients' full range of real estate needs. Based on
published industry data and its industry knowledge, the Company believes that
it holds a leading market position in each of its primary businesses. For
example, the Company believes it is the largest property manager of office
buildings in the United States, one of the largest outsource service providers
for corporate occupied facilities and the third largest manager of
institutional equity capital invested in domestic real estate assets and
securities. The Company is also the fourth largest manager of institutional
real estate equity investments in the United Kingdom. Founded in 1968, the
Company is headquartered in Chicago, Illinois, and maintains corporate offices
in 10 United States cities and four international markets. The Company also
maintains over 300 property and other offices throughout the United States. In
1996, the Company generated total revenue of $176.0 million, representing an
increase of 15.9% from the prior year's results.

To meet the diverse needs of its clients, the Company provides its full
range of real estate services through three principal business groups:
Management Services, Corporate and Financial Services and Investment
Management. The Management Services group develops and implements property
level strategies to increase investment value for real estate owners and
optimize occupancy costs for corporate owners and users of real estate. The
Corporate and Financial Services group provides tenant representation
services, investment banking services and land acquisition and development
services. The Investment Management group provides real estate investment
management services to institutional investors, corporations and high net
worth individuals.

On April 22, 1997, Galbreath, a property management, facility management and
development management company, was merged with the Company. Based on the 1996
CPN Survey, the combination of Galbreath and the Company would have ranked the
Company as the third largest property manager in the United States. The
Company's principal objectives for the merger were to expand the Company's
geographic presence, add additional client relationships and provide the
potential for significant economic synergies with the Management Services
group. Such synergies are expected to result primarily from eliminating
infrastructure redundancies, centralizing accounting and personnel functions
and enhancing Galbreath's management information systems.

COMPETITIVE ADVANTAGES

. Relationship Orientation. The Company's client-driven focus enables the
Company to develop long-term relationships with owners and users of real
estate. By developing such relationships, the Company generates repeat
business and creates recurring revenue sources; 87% of the Company's 1996
revenue was derived from clients for which the Company provided services
in prior years. The Company's relationship orientation is supported by an
employee compensation system which it believes is unique in the real
estate industry. LaSalle Partners compensates its professionals with a
salary, bonus and stock ownership plan which is designed to reward client
relationship building, teamwork and quality performance, rather than on a
commission basis which is typical in the industry.

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. Experienced Management/Employee Equity Incentives. The Company's senior
management team has an average of approximately 18 years of experience in
the real estate services industry and, with the exception of Lizanne
Galbreath who joined the Company on April 22, 1997 in connection with the
Galbreath merger, has been with LaSalle Partners for an average of
approximately 16 years. The Company uses equity-based incentive
compensation and bonus plans and minimum stock ownership guidelines to
foster employee commitment and align employee and stockholder interests.
Following the Offering, the Company's senior management team will
indirectly own approximately 21.4% of the outstanding Common Stock and
total employee ownership will be approximately 47.5%.

INDUSTRY TRENDS

The real estate services industry is emerging from the severe downturn in the
real estate markets in the early 1990s. Strong improvements in commercial real
estate fundamentals--supply, demand, vacancy and rental rates--have contributed
to increased property values. The Company believes that the recovery of the
real estate markets and the trends described below provide growth opportunities
for the Company.

CONSOLIDATION

The real estate services industry is highly fragmented. For example, the top
10 property managers (based on square footage) manage less than 4% and the top
50 property managers manage less than 7% of the 61 billion total square feet of
commercial property (industrial, office and retail) located in the United
States. Many large real estate service firms engaged in the property management
business, including the Company, believe that, as a result of substantial
existing infrastructure investments and the ability to spread fixed costs over
a broader base of business, it is possible to recognize incrementally higher
margins on property management assignments as the amount of square footage
under management increases. The advantages of scale in the property management
business, including the ability to provide higher quality service at a lower
cost to the user, has led to a significant consolidation trend among real
estate service providers.

In addition, large users of commercial real estate services have recently
demonstrated a desire to use a smaller number of real estate firms capable of
providing a full range of services across multiple geographic markets. The
ability to offer a full range of services requires significant corporate
infrastructure investment, including information technology and personnel
training. Smaller regional and local real estate service firms, with limited
resources, are less able to make such investments.

GROWTH OF OUTSOURCING

In recent years, outsourcing of professional real estate services has
increased substantially as corporations have focused corporate resources,
including capital, on their core competencies. In addition, public and other

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non-corporate users of real estate, such as government agencies and health and
educational institutions, have begun outsourcing real estate activities as a
means of reducing costs. As a result, there are significant growth
opportunities for firms that can provide integrated real estate services
across many geographic markets.

ALIGNMENT OF INTERESTS OF INVESTORS AND INVESTMENT MANAGERS

As a result of recovering real estate markets, institutional investors have
increased their allocation of investment capital to real estate and many
investors have shown a desire to commit their capital to investment managers
willing to co-invest with them on specific investments. In addition, investors
are increasingly requiring that the fees paid to investment managers be more
closely aligned with investment performance. As a result, the Company believes
that those investment managers with co-investment capital will have an
advantage in attracting real estate investment capital. Co-investment brings
with it the opportunity to provide additional services related to the
acquisition, financing, property management, leasing and disposition of such
investments.

INCREASING DEMAND FOR GLOBAL SERVICES; GLOBALIZATION OF CAPITAL FLOWS

As many United States corporations have pursued growth opportunities in
international markets, they have increased their demand for global real estate
services, such as facility management, tenant representation and development
management. The Company believes that this trend will favor those real estate
service providers with the capability to provide services in key international
markets. Additionally, real estate capital flows have become more global as
foreign investors have invested in United States assets, and United States
investors have sought international real estate investment opportunities. This
trend has created new markets for investment managers that can facilitate
international real estate capital flows and can execute cross-border real
estate transactions.

GROWTH STRATEGY

Following the Offering, the Company intends to use its increased financial
flexibility to pursue its growth strategy, which is designed to capitalize on
existing client relationships and emerging industry trends. Key components of
its growth strategy include the following:

EXPANDING CLIENT RELATIONSHIPS

Based on its ability to deliver high quality real estate services, the
Company has been able to successfully leverage discrete client assignments
into more comprehensive relationships utilizing some or all of its business
groups. Current industry trends, particularly improving real estate markets
and the increased outsourcing of real estate services, provide a favorable
environment for the Company to increase the scope of its current client
relationships and to develop new relationships through its broad array of
services. The Company's business groups identify new clients and markets and
pursue opportunities to sell the products and services of many of the
Company's business units. The Company's Client Services Group, which is a
dedicated firm-wide marketing organization, acts as a catalyst in assisting
Company professionals in all groups in marketing multiple services of the firm
to existing and prospective clients.

BROADENING INTERNATIONAL PRESENCE

To take advantage of the trend toward globalization of real estate capital
sources and investment opportunities and the international business expansion
of many of its corporate clients, the Company intends to expand its existing
international operations and enter new international markets. This expansion
is expected to include the opening of new international offices and may
include selective acquisitions of international real estate services
companies. In order to serve its clients' increasingly global real estate
needs, and to pursue new business opportunities, the Company has opened
offices in London, Paris, Mexico City and Beijing. The Company intends to use
these international offices to serve as a platform from which the Company will
expand its international presence.

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SELECTIVELY PURSUING STRATEGIC ACQUISITIONS

The Company intends to selectively pursue acquisition targets to expand its
capability to serve clients and strengthen its position as an industry leader.
The expected benefits of such acquisitions include expanding and enhancing its
product and service offerings, broadening its geographic market coverage or
generating economies of scale. The Company will only pursue acquisitions which
meet its standards for quality of service and are compatible with the
Company's culture. Consistent with this strategy, the Company acquired the
assets of ABKB, a domestic real estate investment management business, in late
1994 and CIN Property Management, an investment management business in the
United Kingdom, in late 1996. Through these acquisitions, the Company added
over $5 billion to its assets under management, extended the Company's
securities advisory capabilities and established the Company as one of the
largest managers of real estate investment equity capital in the United
Kingdom. More recently, in April 1997, Galbreath, a national property
management company with 71 million square feet under management, was merged
with the Company. This merger expands the Company's market presence in Ohio,
Pennsylvania, New York, Florida and other key markets and offers the potential
for significant economic synergies with its Management Services group.

PURSUING CO-INVESTMENT OPPORTUNITIES

The Company intends to accelerate its strategy of co-investing with its
investment management clients, to take advantage of recovering real estate
markets. As of March 31, 1997, the Company had a total net investment of $15.8
million in 33 separate property or fund co-investments. The acquisition cost
of the properties acquired through these co-investments exceeds $1.0 billion.
Existing co-investments consist primarily of office and hotel properties
purchased within the last three years.

The Company's co-investment strategy is supported by its broad fundamental
real estate research capabilities, which include identifying trends in
geographic regions and property types. The Company's extensive knowledge of
local markets drawn from each of its business segments facilitates the
identification and evaluation of specific investment opportunities. Co-
investments provide the Company with the opportunity to participate in any
returns generated by such investments and provide services related to the
acquisition, financing, property management, leasing and disposition of such
investments. As a result of the Offering, the Company will have additional
financial flexibility to pursue its co-investment strategy.

BUSINESS SEGMENTS

The Company serves its clients through its three principal business groups.

MANAGEMENT SERVICES

The Company's Management Services group develops and implements property
level strategies to increase investment value for real estate owners and
optimize occupancy costs for corporate owners and users of real estate. The
Management Services group provides three primary service capabilities: (i)
property management and leasing for property owners ("Property Management and
Leasing Services"); (ii) facility management for properties occupied by
corporate owners and users ("Facility Management Services"); and (iii)
development management for both investors and real estate users seeking to
develop new buildings or renovate existing facilities ("Development Management
Services"). As of March 31, 1997, the Management Services group had property
management, leasing or facility management responsibility for approximately
132.7 million square feet of commercial space. In 1996, the Management
Services group generated revenue of $71.9 million and operating income of
$10.7 million, representing approximately 41% of the Company's total revenue
and approximately 40% of the Company's total operating income.

Based on the 1996 CPN Survey, the Company is the largest property manager of
office buildings in the United States and is the eighth largest property
manager in the United States overall. As a result of the merger of Galbreath
with the Company, the Management Services group assumed management
responsibility for

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approximately 71 million additional square feet of primarily office and
industrial space. Including Galbreath, the Company would have ranked as the
third largest property management firm in the 1996 CPN Survey.

[Bar graph depicting the Management Services group's total square footage under
management for the period 1992-1996]

Property Management and Leasing Services. Active since 1978, the Company's
Property Management and Leasing Services unit operates, markets and leases
commercial real estate. The Company was a pioneer in the development of value-
creating property management services. The Company's goal is to enhance its
clients' property values through aggressive day-to-day management focused on
maintaining high levels of occupancy and tenant satisfaction, while lowering
the operating costs of such properties. The Company's Property Management and
Leasing Services unit generated approximately $52.3 million in revenue in
1996.

Prior to the merger of Galbreath with the Company, the Company represented
more than 70 property owners, providing on-site Property Management and
Leasing Services for approximately 170 office, retail, mixed-use and
industrial properties, in 29 of the largest markets in the U.S. During 1996,
leasing professionals completed over 1,200 lease transactions totaling
approximately 9.5 million square feet. As a result of the merger of Galbreath
with the Company, the Company assumed management responsibility for over 200
additional properties in five additional markets (including two of the largest
markets in the U.S.) for over 20 new institutional real estate owners.

The Company provides property management or leasing services, or both, for
many well-known buildings, including the Amoco Building in Chicago, the
Citicorp Center in New York, and the Transamerica Building in San Francisco.
While major office buildings represent the Company's most visible assignments,
the Company is also active in the management of retail projects, industrial
real estate, mid-size assets of all types and portfolios of smaller
properties. The clients of the Company's Property Management and Leasing
Services unit include domestic and international pension funds, the Company's
own investment funds and third-party corporate and institutional investment
clients. Representative clients served in 1996 included The Allstate
Corporation, Amoco Corporation, Lincoln National Corporation, Mitsui Fudosan
Co. Ltd. and Transamerica Corporation.

Consolidation among property management and leasing companies, in
combination with improving leasing markets, provides significant opportunities
for the Company. Since the fee arrangements for most of the Company's Property
Management and Leasing Services assignments are largely dependent on property
revenues, the Company has benefited from the national recovery in commercial
real estate markets. This recovery has been characterized by rising average
commercial rental and occupancy rates during the 1993-1996 time period.

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The Company intends to expand its Property Management and Leasing Services
unit through a combination of targeted marketing initiatives and acquisitions.
Based on its industry experience, the Company believes that its established
infrastructure and its reputation for high quality service make the Company an
attractive potential acquiror to many smaller local, regional and national
property management firms. The marketing efforts of the Property Management
and Leasing Services unit are directed toward pursuing new third-party
management assignments, expanding the Company's relationships with existing
clients and capitalizing on new business opportunities that may arise from the
Investment Management group's initiatives, such as implementation of its co-
investment strategy. As of March 31, 1997, more than half of the Company's
63.5 million square foot Property Management and Leasing Services portfolio
was composed of assets owned by unrelated third party clients and the
remainder was composed of assets managed for clients for which LaSalle
Partners also provided investment advisory services. The Company believes that
during the next several years, this business mix will become increasingly
weighted toward assets owned by unrelated third-parties, with a decreasing
emphasis on assets owned in the Company's existing investment funds, as many
of the commingled funds created by the Company in the 1980s reach maturity and
dissolution. See "Management's Discussion and Analysis of Financial Condition
and Results of Operations."

The Company's Property Management and Leasing Services are typically
provided by an on-site general manager and staff supported through extensive
regional supervisory teams as well as central resources in areas such as
training, technical and environmental services, accounting, marketing and
human resources. Property general managers assume full responsibility for
property management and leasing activities, client satisfaction and financial
results. Property Management and Leasing Services personnel are compensated,
not by fees or commissions, but through a combination of base salary and
performance bonus that is directly linked to results produced for clients.

The Company typically receives fees based on the value of the lease revenue
commitment for leases consummated while it serves as exclusive property
leasing agent. Increasingly, management agreements provide for incentive
compensation relating to operating expense reductions, gross revenue,
occupancy objectives or tenant satisfaction levels. As is customary in the
industry, management contract terms typically range from one to three years,
but are cancellable at any time upon a short notice period, usually 30 to 60
days. However, on a portfolio basis, the Company's current average length per
management assignment is approximately four years.

Facility Management Services. The Company's Facility Management Services
unit provides comprehensive portfolio and property management services to
corporations and institutions that outsource their real estate management
functions. The properties under management range from corporate headquarters
to industrial complexes, sales offices and data centers. Facility Management
Services professionals create working partnerships with each client to deliver
fully-integrated real estate services that are tailored to the specific needs
of each organization. Typically, performance measures are developed to
quantify progress made toward the goals and objectives that are set mutually
with clients. The Company's Facility Management Services unit also serves as
an important "port of entry" for the Company's other business units. Depending
on client needs, the Facility Management Services unit, either alone or
through the Company's other business units, provides services such as
portfolio planning, property management, leasing, tenant representation,
acquisition, finance, disposition, project management, development management
and land advisory services. In 1996, the Facility Management Services unit
generated revenue of approximately $13.6 million. Facility Management Services
relationships also generated revenue of approximately $12.8 million in 1996
for the Company's other business units.

The Company was a pioneer in the facility management services business and
currently is one of the largest providers of facility management services in
the United States. The Company's target clients typically have large
portfolios (usually over one million square feet) with significant
opportunities to reduce costs and improve service delivery. At March 31, 1997,
the Company managed approximately 5,500 facilities, totaling more than 69
million square feet of space for eight clients. Representative clients served
in 1996 included Ameritech, BankAmerica Corporation and Sun Microsystems, Inc.
As a result of the merger of Galbreath with the Company, the Company assumed
management responsibility for facilities totaling 13 million square feet for
clients such as Eli Lilly and Company, The LTV Corporation and The Mead
Corporation. The Facility Management Services-

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unit is also exploring new business opportunities with universities, health
care institutions, government agencies and other potential clients.

The Company believes that the global corporate trend of outsourcing non-core
business functions represents an important long-term business opportunity for
LaSalle Partners. The Company believes that its broad-based service
capabilities will become an increasingly valuable competitive advantage in
pursuing Facility Management Services assignments. The Company believes that
its demonstrated experience, cost-cutting successes and client satisfaction
also provide it with an important competitive advantage. The Company has set
and consistently met its objective of cutting operating costs of its
properties under management between 10% and 30% within the first two years of
the assignment. In order to efficiently provide all services required to
manage and operate large facility portfolios, the Company forms partnerships
with major building services and architecture firms.

The Facility Management Services unit is compensated on the basis of
negotiated fees, which are typically structured to include a base fee and a
performance bonus. The performance bonus compensation is based on a
quantitative evaluation of progress toward performance measures and regularly
scheduled client satisfaction surveys. Facility Management Services agreements
are typically three to five years in duration.

Development Management Services. Active since 1975, the Company's
Development Management Services unit manages all aspects of the development,
redevelopment and renovation of commercial projects, principally on a fee
basis. The Company prepares projections, budgets, schedules and cash flows for
its clients in addition to undertaking entitlement, zoning and a variety of
other development-related responsibilities. All of the Company's current
development business is conducted for third-party clients, many of which are
corporations with significant office space needs. The Development Management
Services unit frequently manages development initiatives for clients of the
Company's Facility Management Services, Tenant Representation Services and
Land Services units, as well as for clients of the Company's Investment
Management group which are pursuing development-related investment strategies.
In 1996, the Development Management Services unit generated approximately $5.5
million in revenue.

The Company has extensive experience in ground-up development in the office,
retail and institutional sectors and has completed more than 41 million square
feet of development and redevelopment projects for clients such as Capital
Cities/ABC, Inc., Duracell International Inc., McDonald's Corporation and The
Prudential Insurance Company of America. The Development Management Services
unit is currently managing the development of 17 projects totaling
approximately 4.5 million square feet nationally. Capitalizing on experience
gained in the redevelopment of Union Station in Washington, D.C., the Company
also specializes in mixed-use developments and is currently managing the
redevelopment of Grand Central Terminal in New York as a combined
transportation center and retail facility and the redevelopment of Orchestra
Hall in Chicago, Illinois.

The Development Management Services unit generates development and advisory
fees. Fees are typically fixed and are negotiated based upon the cost of the
developments or improvements. Assignments are typically multi-year in nature.

CORPORATE AND FINANCIAL SERVICES

The Company's Corporate and Financial Services group provides transaction
and advisory services through three primary service capabilities: (i) tenant
representation for corporations and professional service firms ("Tenant
Representation Services"); (ii) investment banking services to address the
financing, acquisition and disposition needs of real estate owners
("Investment Banking Services"); and (iii) land acquisition and development
services for owners, users and developers of land ("Land Services"). In 1996,
the Corporate and Financial Services group generated revenue of $46.7 million
and operating income of $10.8 million, representing approximately 27% of the
Company's total revenue and approximately 40% of the Company's total operating
income.

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[Bar graph depicting revenue for the Tenant Representation Services unit for
the period 1992-1996]

Tenant Representation Services. First offered in 1978, the Company's Tenant
Representation Services unit assists clients by defining space requirements,
identifying suitable alternatives, recommending appropriate occupancy
solutions and negotiating lease and ownership terms with third parties. This
unit also includes the project management group which provides strategic
occupancy planning, field tenant improvement, project management and
relocation management to the Company's clients.

The Company seeks to lower its clients' real estate costs, minimize real
estate occupancy risks, improve clients' flexibility and occupancy control and
create more productive office environments. The Company uses a multi-
disciplined approach to develop occupancy strategies that are linked to its
clients' core business objectives. In 1996, the Tenant Representation Services
unit generated revenue of approximately $31.2 million, completing over 250
transactions for a total of approximately seven million square feet.

The domestic tenant representation industry includes a large number of
service providers offering a wide range of service quality and capabilities.
The Tenant Representation Services unit directs its marketing efforts toward
developing "strategic alliances" with clients whose real estate requirements
include ongoing assistance in meeting their real estate needs and also toward
clients who have the need to consider multiple real estate options and to
execute complex strategies. Based on its industry experience, the Company
believes that it is recognized as one of the highest quality providers of
tenant representation services in the United States. Representative clients
served in 1996 included Amoco Corporation, Aon Corporation, R.R. Donnelley &
Sons Company and Towers Perrin.

In many cases, the Company develops a strategic alliance with clients to
deliver fully integrated real estate services, including comprehensive on-
going strategic planning and transaction execution services across multiple
office locations. The Company views its strategic alliances as a competitive
advantage since these long-term relationships lower business development costs
for the Company and create recurring revenue sources. In 1996, approximately
79% of Tenant Representation Services unit revenue was derived from strategic
alliances. Through these relationships, the Company gains a better
understanding of its clients' portfolio and occupancy requirements since the
same professionals service the client's needs nationwide. The Company believes
that these relationships enable it to deliver more consistent services and
better results than single-transaction, commissioned brokerage service
providers.

Responsibility for the national occupancy needs of strategic alliance
clients is assigned to dedicated client teams. These teams allocate resources
to address specific client requirements in markets throughout the United
States. The Company's Tenant Representation Services unit draws upon the
resources and local market knowledge of the Company's network of Property
Management and Leasing Services professionals located in over 300 property and
other offices in 31 of the largest markets in the U.S.

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In addition to its strategic alliances, the Company also represents clients
in large, complex transaction assignments that typically involve relocations
of headquarters facilities or major consolidations of offices. In such
assignments, the Company draws on other capabilities of the firm to enable
clients to consider development of new facilities, weigh the benefits of
purchase or lease decisions and evaluate long-term financing options.

Based on its industry experience, the Company believes that the educational
background and skills of its Tenant Representation professionals and its
employee compensation structure are uncommon in the industry and are a
significant competitive strength. The Company's Tenant Representation Services
professionals are recruited on the basis of strong educational credentials and
broad business experience, with approximately 90% holding Master of Business
Administration or other advanced degrees. In contrast to the Company's major
national brokerage competitors, the Company's Tenant Representation Services
professionals do not earn commissions, but are compensated by means of a base
salary and performance bonus that is determined by their contribution to
achieving predetermined client performance objectives.

The Tenant Representation Services unit uses state-of-the-art computer
technology, including proprietary software developed by the Company, to
improve productivity and enhance client service. For example, it has created
an on-line lease analysis/negotiation program that enables users to scan in a
lease from a third party, and then compare lease language in each section
against a database of "best-practices" lease language drawn from previous
engagements.

The Company is generally compensated for Tenant Representation Services on a
negotiated fee basis. Although fees are generated by lease commissions, they
are often also determined by performance related to targets set by the Company
and the client prior to the Company's engagement and, in the case of strategic
alliances, at annual intervals thereafter. Quantitative and qualitative
measurements assess progress relative to these goals, and the Company is
compensated accordingly, with incentive fees often awarded for superior
performance.

Investment Banking Services. Active since 1968, the Company's Investment
Banking Services unit is engaged in real estate finance, portfolio advisory
activities, corporate finance and institutional property sales. In 1996, the
Company completed institutional property sales, debt financings, equity
financings and portfolio advisory activities on assets and portfolios valued
at approximately $4.9 billion. The Investment Banking Services unit generated
revenue of approximately $6.7 million in 1996.

The Company believes that its Investment Banking Services unit has a number
of competitive strengths, including its broad accumulated base of real estate
investment banking knowledge and an ability to draw on the Company's access to
global capital sources. The Company's Management Services group and Investment
Management group are valuable resources for the Investment Banking Services
unit in providing local market and property information and capital markets
expertise.

The Investment Banking Services unit is integral to the business development
efforts of the Company's other business units by researching, developing and
introducing innovative new financial products and strategies. Such efforts
have included the development of the Company's hotel investment capability and
its commercial mortgage backed securities operation, both of which are
currently operated within the Company's Investment Management group.

In 1996, approximately 61% of the Company's Investment Banking Services
assignments represented repeat business from its clients. In addition,
approximately 54% of Investment Banking Services revenue represented fees
derived from sales of assets for clients for which LaSalle Partners also
provides investment management services. Representative clients served in 1996
included ENRON Corp., Equifax Inc., G.E. Investment Corp. and Sumitomo Trust &
Banking Co., Ltd.

The Company is typically compensated for Investment Banking Services on the
basis of the value of transactions completed or securities placed, but in
certain circumstances the Company receives retainer fees for strategic
advisory services.

49
<PAGE>

Land Services. The Company has been active in the evaluation, acquisition
and disposition of land assets since 1970. The Company's Land Services
professionals offer clients expertise and broad experience in a range of land-
related competencies, including land planning and urban design, political
approvals, market and financial analysis and valuations. The Land Services
unit completed 37 transactions in 1996 in United States markets as well as in
multiple international markets. The Company's Land Services unit benefits from
LaSalle Partners' strong relationships with its clients, with approximately
50% of Land Services unit transactions in 1996 involving clients serviced by
other business units of the Company. The Land Services unit generated
approximately $4.9 million of revenue in 1996.

The Land Services unit acquires and sells urban and suburban development
projects and sites for future development, undertakes complex land assemblages
and site searches and provides advisory services for owners of land and land-
development projects. The Company's Land Services unit also originates and
executes land-related investment programs in development properties and
portfolios of land assets for the clients of the Company's Investment
Management group. In addition, the Company developed expertise in the sale of
portfolios of land and land-related assets by completing such assignments for
several corporate clients, as well as the disposition of the $1.7 billion
National Land Fund for the Resolution Trust Corporation. The Company's Land
Services professionals also have advised public institutions on land-related
assignments, including the conversion of military base facilities, master
planning of peripheral airport land and the evaluation and disposition of land
related to major transit systems.

Representative clients served in 1996 included the California Public
Employees' Retirement System, City of Chicago, Nippon Landic (USA), Inc. and
Shell Oil Company.

INVESTMENT MANAGEMENT

The Company's Investment Management group provides real estate investment
management services to institutional investors, corporations and high net-
worth individuals. The Company serves its clients through a broad range of
real estate money management products and services in the public and private
capital markets to meet various strategic, risk/return and liquidity
requirements, with a wide variety of equity and debt products. This business
is organized along two functional lines, private equity and debt investments
and public equity and debt investments. The Company offers its clients a range
of investment alternatives, including private direct (i.e. single asset
acquisitions) and fund (i.e. portfolios of assets) investments in many real
estate property types (e.g., office, retail, hotel, industrial, residential,
land and parking) and public investments, primarily in REITs, other public
real estate equities and CMBS. The Company believes that the success of the
Investment Management group is built on the foundation of fully integrated
research, innovative investment strategies and a strong client focus. The
Company believes, based on its industry knowledge, that it has developed a
reputation as an industry leader and innovator in real estate investment
management. The Investment Management group's strategy is focused on three
fundamentals: (i) developing and executing tailored investment strategies to
meet a variety of client objectives; (ii) providing superior performance for
its clients; and (iii) delivering a high level of service.

As of March 31, 1997, the Company managed approximately $15.1 billion of
real estate assets, making LaSalle Partners the third largest manager of
institutional equity capital invested in domestic real estate assets and
securities. Approximately $2.5 billion of this total represents public real
estate securities currently managed by the Company's ABKB/LaSalle Securities
unit ("ABKB/LaSalle Securities"), a leading domestic institutional real estate
money manager.

The investment and capital origination activities of the Company's
Investment Management group are becoming increasingly international. As of
March 31, 1997, 22% of the Company's assets under management were invested
outside of the United States. Additionally, approximately 38% of equity
capital currently under management by the Company originated from
international investors. The Company expects its international Investment
Management group to continue to increase as a proportion of total capital
raised and invested. In 1996, the Investment Management group generated $58.6
million of revenue and $5.3 million of operating income, representing
approximately 33% of the Company's total revenue and 20% of the Company's
total

50
<PAGE>

operating income. Investment Management group activities generate significant
additional business for other parts of the Company's operations, particularly
in the areas of Property Management and Leasing Services and Investment
Banking Services.

The Company maintains an extensive real estate research department which
monitors real estate and capital market conditions to enhance investment
decisions and identify future opportunities. The Company believes, based on
its industry experience, that its staff of 12 professionals is one of the
industry's most significant commitments to fundamental research for real
estate investors. In addition to drawing on public sources for information,
the research department utilizes the extensive local presence of LaSalle
Partners professionals throughout the United States to gain proprietary
insight into local market conditions. Representative clients served in 1996
included the British Coal Pension Fund, California Public Employees'
Retirement System, Cargill, Dai-ichi Life (U.S.A.), Inc. and Oregon Public
Employees' Retirement Fund.

[Bar graph depicting the Investment Management group's Assets under management
for the period 1992-1996]

Private Equity and Debt Investments. The Company introduced its first
institutional investment fund in 1979 and currently has a series of commingled
investment funds with over 115 investors. The Company also has 34 single
client account relationships ("separate accounts") with domestic and
international investors for whom the Company manages private real estate
investments. On behalf of its Investment Management clients, the Company
acquires, manages, leases, finances and divests real estate investments across
a broad range of real estate property types.

To take advantage of the trend toward globalization of real estate capital
sources, the Company strengthened and extended its international investment
activities with the acquisition in October 1996, of CIN Property Management
(now renamed CIN LaSalle Investment). The Company believes that CIN LaSalle
Investment, the fourth largest manager of real estate equity investments in
the United Kingdom, will expand the Company's investment activities and
capital raising in the United Kingdom and continental Europe. The Company also
initiated opportunistic investment programs in France in 1996, acquiring for
clients one of the first distressed French real estate loan portfolios sold by
financial institutions. The Company believes that significant additional
investment opportunities will arise in France due to existing economic
conditions, and that it is well positioned to play a role in the restructuring
of French real estate assets. The Company currently has approximately 300
assets under investment or property management agreements in the United
Kingdom and France, with a total value of approximately $3.4 billion at March
31, 1997.

51
<PAGE>

The Company continues to explore additional international markets for its
Investment Management group clients. The Company intends to leverage its
organizational strength through selective acquisitions and the use of the
Company's international offices to take advantage of the accelerating interest
in international investment, to expand investment activity to new countries
and to strengthen its position as a leading intermediary for international
real estate capital flows.

The trend among investors is to favor advisors that co-invest in newly
formed investment vehicles in order to better align the interests of the
investor and the advisor. The Company believes that co-investment will become
increasingly important in order for the Company to retain and expand its
competitive position. The Company also believes that its co-investment
strategy will greatly strengthen its ability to raise capital for new
investment funds over which the Company exercises discretionary investment
authority. After the Offering, the Company intends to accelerate its co-
investment activities. By increasing assets under management, the Company will
gain the opportunity to provide additional services related to the
acquisition, financing, property management, leasing and disposition of such
assets. Co-investment will also provide a vehicle for the Company to
participate in investment opportunities resulting from recovering real estate
markets. As of March 31, 1997, the Company had a net total investment of $15.8
million in 33 separate property or fund co-investments. The acquisition cost
of the properties acquired through these co-investments exceeds $1.0 billion.
Existing co-investments consist primarily of office and hotel properties
purchased within the last three years.

Investment Management group operations are conducted with teams of
professionals dedicated to achieving client objectives. The portfolio managers
serve as the relationship coordinators for the Company's clients and are
responsible for drawing on all of the resources of the Investment Management
group (including research, investment services and specialty products) and the
rest of the Company's global resources. All investment decisions for private
market investments must be approved by the Company's five-member investment
committee. The investment committee approval process is utilized for both the
Company's discretionary investment funds and for all of its separate account
clients.

The Company is generally compensated for investment management services for
private equity and debt investments based on initial capital invested, with
additional fees tied to investment performance above benchmark levels. The
term of the Company's advisory agreements varies by the form of investment
vehicle involved and the type of service provided. The Company's investment
funds have various lifespans, typically ranging between five and ten years,
with extension provisions based on a vote of investors. Separate account
advisory agreements generally have three year terms with "at will" termination
provisions.

Public Equity and Debt Investments. The Company offers its clients the
ability to invest in either separate account or fund investment vehicles
focused on public real estate equity and debt securities. The Company
principally invests its clients' capital in domestic REIT equities and CMBS.
LaSalle Partners is also active in private placement investments in publicly
traded real estate companies and selected investments in private real estate
companies seeking capital to ultimately gain access to the public markets.

The Company conducts its securities investment business through ABKB/LaSalle
Securities, which was formed by the Company in 1994 in connection with the
acquisition of ABKB's real estate advisory business. As of the end of 1994,
ABKB/LaSalle Securities served 21 clients and had approximately $630 million
of assets under management. As of March 31, 1997, ABKB/LaSalle Securities
served 35 securities investment clients with $2.5 billion of assets under
management. The Company is typically compensated by its securities investment
clients on the basis of the market value of assets under management with
increasing use of incentive fees tied to performance of investments above
benchmark levels.

GALBREATH ACQUISITION

On April 22, 1997, the Predecessor Partnerships acquired Galbreath pursuant
to a Contribution and Exchange Agreement, of the same date, among the Employee
Partnerships, the Predecessor Partnerships, Galbreath, the former stockholders
of Galbreath and certain related entities (the "Contribution and Exchange

52
<PAGE>

Agreement"). Pursuant to the Contribution and Exchange Agreement, all of the
outstanding capital stock of Galbreath and related entities was contributed to
the Predecessor Partnerships in exchange for limited partnership interests
representing an aggregate of 18% of the Predecessor Partnerships' general and
limited partnership interests. Such limited partnership interests were issued
to Galbreath Holdings, LLC ("Galbreath Holdings") and Galbreath-LPL Holdings,
LLC ("Galbreath-LPL") and will be exchanged for shares of Common Stock in the
Partnership Interests Exchange. See "Incorporation Transactions."

The Employee Partnerships and the Predecessor Partnerships have agreed to
jointly and severally indemnify the former Galbreath stockholders for any
damage or loss resulting from, among other things, any breach of the Employee
Partnerships' or the Predecessor Partnerships' representations and warranties
contained in the Contribution and Exchange Agreement. The former Galbreath
stockholders have agreed to provide similar indemnification to the Company and
the Employee Partnerships. The indemnification obligations of the Predecessor
Partnerships and the Employee Partnerships as a group and the former Galbreath
stockholders as a group are generally limited to an amount equal to 30% of the
value of the partnership interests transferred to the former Galbreath
stockholders. Pursuant to the Contribution and Exchange Agreement, the
representations and warranties will survive until the date of the issuance of
the financial statements of the Company for the year ending December 31, 1997,
which date shall not be later than March 31, 1998.

Pursuant to the Contribution and Exchange Agreement, as long as Galbreath
Holdings is the beneficial owner of at least ten percent of the Company's
outstanding Common Stock, it shall have the right to nominate one member to the
Board of Directors. Lizanne Galbreath was the initial nominee of Galbreath
Holdings.

Under the Contribution and Exchange Agreement, Galbreath was obligated to
acquire and transfer to the Predecessor Partnerships the fifty percent
partnership interest of a joint venture partner in Galbreath Middle-Atlantic
Partnership ("GMAP"). GMAP provides property management and leasing services in
the Pittsburgh metropolitan area. The third-party partner in GMAP has indicated
that it will not complete the sale of its interests. As a result, the Company
and the former Galbreath stockholders are engaged in negotiations to determine
the number of shares of Common Stock and/or cash that the former stockholders
of Galbreath will surrender to the Employee Partnerships and Dai-ichi to
replace the value of the GMAP interests. The proportional interests in the
Company of the Employee Partnerships, Dai-ichi and the former stockholders of
Galbreath may change slightly depending upon the result of such negotiations.

In connection with the Contribution and Exchange Agreement, the Company
granted the Employee Partnerships, Dai-ichi, and the former Galbreath
stockholders certain registration rights. See "Shares Eligible for Future
Sale--Registration Rights."

COMPETITION

The market for commercial real estate services provided by the Company is
both highly fragmented and highly competitive. In each of its business
disciplines, the Company competes on the basis of the skill and quality of its
personnel, the variety of services offered, the cost of the services offered,
the ability to enhance asset values, the breadth of geographic coverage and the
quality of its infrastructure, including training and technology. Based on
industry experience, the Company believes it has a strong reputation for the
quality of its services as well as its client oriented approach. The Company
believes that its experienced employees, broad range of services provided,
local and broad market expertise, and operating infrastructure enable it to
compete effectively in each of its business disciplines. See "Risk Factors--
Competition."

FACILITIES

The Company's principal executive office is located at 200 East Randolph
Drive, Chicago, Illinois, where the Company currently occupies over 100,000
square feet of office space pursuant to a lease that expires in February 2006.
The Company has 10 United States corporate offices located in Atlanta,
Baltimore, Chicago, Columbus, Dallas, Denver, Los Angeles, New York, San
Francisco and Washington D.C. and four international corporate offices located
in London, Paris, Mexico City and Beijing. The Company's corporate offices are
each leased pursuant to agreements with terms ranging from month-to-month to 10
years. In addition, the Company has over 300 property and other offices
throughout the United States. On-site property management offices are generally
located within properties under management and are provided without cost.

53
<PAGE>

ENVIRONMENTAL

Various federal, state and local laws and regulations impose liability on
current or previous real property owners or operators for the cost of
investigating, cleaning up or removing contamination caused by hazardous or
toxic substances at the property. In the Company's role as an on-site property
manager, it could be held liable as an operator for such costs. Such liability
may be imposed without regard to fault or legality of the original actions and
without regard to whether the Company knew of, or was responsible for, the
presence of such hazardous or toxic substances, and such liability may be
joint and several with other parties. If the liability is joint and several,
the Company could be responsible for payment of the full amount of the
liability, whether or not any other responsible party is also liable. Further,
any failure of the Company to disclose environmental issues could subject the
Company to liability to a buyer or lessee of property. In addition, some
environmental laws create a lien on the contaminated site in favor of the
government for damages and costs it incurs in connection with the
contamination. The presence of contamination or the failure to remediate
contamination may adversely affect the owner's ability to sell or lease real
estate or to borrow using the real estate as collateral. The owner or operator
of a site may be liable under common law to third parties for damages and
injuries resulting from environmental contamination emanating from the site,
including the presence of asbestos-containing materials. See "Risk Factors--
Environmental Concerns."

On November 29, 1996, Galbreath received a Citation and Notification of
Penalty from the Occupational Safety and Health Administration ("OSHA")
describing certain asbestos-related violations. The citation set forth a
proposed penalty amount of approximately $150,000. Galbreath has complied with
OSHA's requests, but has denied any wrongdoing. Galbreath is currently in
negotiations with OSHA with respect to the amount due in connection with the
citation. On March 7, 1997, the Secretary of Labor of the United States
Department of Labor brought an action against Galbreath before the
Occupational Safety and Health Review Commission seeking an order affirming
the citation and the amount proposed therein. Galbreath has filed a motion for
extension of time to answer the complaint.

LEGAL PROCEEDINGS

The Company is a defendant in various litigation matters arising in the
ordinary course of business, some of which involve claims for damages that are
substantial in amount. Most of these matters are covered by insurance. In the
opinion of the Company, the ultimate resolution of such litigation matters
will not have a material adverse effect on the financial position, results of
operations and liquidity of the Company.

EMPLOYEES

As of May 31, 1997, following the merger of Galbreath with the Company, the
Company employed 1,322 people, including 1,096 professional staff members and
226 support personnel. None of the Company's employees are members of any
labor union.

The Company has entered into an agreement with LPI Service Corporation
("LPISC"), a company controlled by a former employee of LaSalle Partners,
pursuant to which LPISC provides the services of approximately 3,000
janitorial, engineering and property maintenance workers for certain
properties managed by the Company. LaSalle Partners has an option to purchase
LPISC. Approximately 600 of the employees of LPISC are members of labor
unions.

54
<PAGE>

MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The directors and executive officers of the Company are as follows:

<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Stuart L.
Scott 58 Chairman of the Board of Directors and Chief Executive Officer
Robert C.
Spoerri 48 President, Chief Operating Officer and Director
William E.
Sullivan 42 Executive Vice President, Chief Financial Officer and Director
Daniel W.
Cummings 44 Co-President--LaSalle Advisors Capital Management, Inc. and Director
Charles K. 50
Esler, President and Chief Executive Officer--LaSalle Partners Management
Jr. Services, Inc. and Director
Lizanne
Galbreath 39 Chairman, LaSalle Partners Management Services, Inc. and Director
M.G. Rose 57 President, Tenant Representation Division--LaSalle Partners
Corporate & Financial Services, Inc. and Director
Lynn C.
Thurber 50 Co-President--LaSalle Advisors Capital Management, Inc. and Director
Earl E. 40 Managing Director, Investment Banking Division--LaSalle Partners
Webb Corporate & Financial Services, Inc. and Director
Darryl 52
Hartley-
Leonard Nominee for Director*
Thomas C. 60
Theobald Nominee for Director*
</TABLE>
- --------
*These individuals have consented to become directors of the Company following
completion of the Offering. The Company intends to identify at least one
additional independent director prior to consummation of the Offering.

Stuart L. Scott. Mr. Scott has been Chairman of the Board of Directors and
Chief Executive Officer of the Company since its incorporation, and Chief
Executive Officer and Chairman of the Management Committee of the Predecessor
Partnerships since December 1992. Prior to December 1992, Mr. Scott was
President of the Predecessor Partnerships for more than 15 years and Co-
Chairman of the Management Committee from January 1990 to December 1992. Mr.
Scott originally joined the Company in 1973. He is a member of the Board of
Directors of Hartmarx Corporation, a clothing manufacturing company. He holds
a B.A. from Hamilton College and a J.D. from Northwestern University.

Robert C. Spoerri. Mr. Spoerri has been President, Chief Operating Officer
and a director of the Company since its incorporation, and Chief Operating
Officer and Vice-Chairman of the Management Committee of the Predecessor
Partnerships since January 1994. From January 1990 to December 1993, Mr.
Spoerri was a Co-Director of the asset management group of the Predecessor
Partnerships and the Director of the property management and leasing group of
the Predecessor Partnerships from January 1980 to December 1989. Mr. Spoerri
originally joined the Company in 1977. He holds a B.S. from Indiana University
and an M.B.A. from Harvard University.

William E. Sullivan. Mr. Sullivan has been Executive Vice President, Chief
Financial Officer and a director of the Company since its incorporation, and
Executive Vice President and Chief Financial Officer of the Predecessor
Partnerships since February 1997. From September 1995 to February 1997, Mr.
Sullivan was a Managing Director of the special projects group of the
Predecessor Partnerships. From January 1992 to September 1995, Mr. Sullivan
was a Senior Vice President of the special projects group. Mr. Sullivan
originally joined the Company in 1984. He holds a B.S.B.A. from Georgetown
University and an M.M. from Northwestern University.

Daniel W. Cummings. Mr. Cummings has been a director of the Company since
its incorporation, and a Co-President of LaSalle Advisors Capital Management,
Inc., an operating subsidiary of the Company, since April

55
<PAGE>

1997. Mr. Cummings has been a Managing Director and Co-President of LaSalle
Advisors Limited Partnership, a subsidiary of one of the Predecessor
Partnerships, since November 1994. From January 1992 to November 1994, Mr.
Cummings was a Managing Director--Portfolio Management of LaSalle Advisors
Limited Partnership. Mr. Cummings originally joined the Company in 1979. He
holds a B.A. from Dartmouth College and an M.B.A. from the University of
Chicago.

Charles K. Esler. Mr. Esler has been a director of the Company since its
incorporation, and President and Chief Executive Officer of LaSalle Partners
Management Services, Inc., an operating subsidiary of the Company, since April
1997. Since 1992, Mr. Esler has been President of LaSalle Partners Management
Limited, one of the Predecessor Partnerships. Mr. Esler originally joined the
Company in 1979. He holds a B.S.M.E. from the University of Michigan and an
M.B.A. from Northwestern University.

Lizanne Galbreath. Ms. Galbreath has been Chairman of LaSalle Partners
Management Services, Inc. and a director of the Company since April 1997, when
Galbreath was merged with the Company. Prior to the merger, Ms. Galbreath was
Chairman and Chief Executive Officer of Galbreath from August 1995 to April
1997. From June 1993 to August 1995, Ms. Galbreath served as Vice-Chairman of
Galbreath, and from June 1992 to May 1993, Ms. Galbreath was Senior Managing
Director in charge of national accounts. Ms. Galbreath originally joined
Galbreath in 1984. Ms. Galbreath holds a B.A. from Dartmouth College and an
M.B.A. from the University of Pennsylvania.

M.G. Rose. Mr. Rose has been a director of the Company since its
incorporation, and President, Tenant Representation Division of LaSalle
Partners Corporate & Financial Services, Inc., an operating subsidiary of the
Company, since April 1997. Mr. Rose has been a Managing Director and President
of the tenant representation group of the Predecessor Partnerships since
September 1983. He originally joined the Company in 1978. Mr. Rose holds a
mechanical engineering degree from the University of Cincinnati.

Lynn C. Thurber. Ms. Thurber has been a director of the Company since its
incorporation, and a Co-President of LaSalle Advisors Capital Management,
Inc., an operating subsidiary of the Company, since April 1997. Ms. Thurber
has been a Managing Director and Co-President of LaSalle Advisors Limited
Partnership, a subsidiary of one of the Predecessor Partnerships, since
November 1994. Ms. Thurber was Chief Executive Officer of ABKB from May 1993
to November 1994, at which time its assets were acquired by the Company. From
July 1992 to May 1993, Ms. Thurber served as Chief Operating Officer and
Director of Acquisitions of ABKB. Prior to that time, Ms.Thurber was a
Principal at Morgan Stanley & Co. Incorporated. She holds an A.B. from
Wellesley College and an M.B.A. from Harvard University.

Earl E. Webb. Mr. Webb has been a director of the Company since its
incorporation, and Managing Director, Investment Banking Division of LaSalle
Partners Corporate & Financial Services, Inc., an operating subsidiary of the
Company, since April 1997. Mr. Webb has been Managing Director of the
Investment Banking Division of the Predecessor Partnerships since January
1995. From January 1992 to January 1995, Mr. Webb was a Senior Vice-President
of the Predecessor Partnerships. Mr. Webb originally joined the Company in
1985. Mr. Webb has also been a member of the board of directors of Players
International, Inc., a multi-jurisdictional gaming company, since September
1996. He holds a B.S. from the University of Virginia and an M.M. from
Northwestern University.

Darryl Hartley-Leonard. Mr. Hartley-Leonard is a private investor. He
formerly worked for Hyatt Hotels Corporation ("Hyatt") for 32 years. From 1994
to 1996 he served as Chairman of the Board of Directors of Hyatt and from 1986
to 1994, he served as Chief Executive Officer/Chief Operating Officer of
Hyatt. Mr. Hartley-Leonard currently serves on the board of directors of
TeleQuest Corporation, a privately-held, high-technology company; PGI, a
global events, entertainment, exhibition and business communications company;
The Metropolitan Residential Hotel Company, a long-term stay apartment hotel
company; and Cohabaco, a cigar distribution company. Mr. Hartley-Leonard holds
a B.A. degree from Blackpool Lancashire College of Lancaster University and an
honorary doctorate of business administration from Johnson and Wales
University.

56
<PAGE>

Thomas C. Theobald. Mr. Theobald has served as a Managing Director at
William Blair Capital Partners since September 1994. From July 1987 to August
1994, Mr. Theobald was Chairman of Continental Bank Corporation. He currently
serves on the board of directors of Xerox Corporation, a manufacturer of
document processing products and systems; Anixter International, a supplier of
electrical apparatus and equipment; Enron Global Power & Pipelines LLC, a
worldwide manager of power plants and natural gas pipelines; Stein Roe Funds,
an income trust fund and investment trust fund manager; LaSalle Income and
Growth Fund, a REIT; and Peregrine Asia Pacific Growth Fund, an investment
fund focused on investments in the Asian pacific region. Mr. Theobald holds an
A.B. degree from the College of the Holy Cross and an M.B.A. degree from
Harvard University.

The Company's Board of Directors will be divided into three classes, each of
whose members will serve for a staggered three-year term. The board will
consist of three Class I Directors (Messrs. Spoerri, Esler and Cummings),
three Class II Directors (Messrs. Sullivan and Webb and Ms. Galbreath) and
three Class III Directors (Messrs. Scott and Rose and Ms. Thurber). At each
annual meeting of stockholders, a class of directors will be elected for a
three-year term to succeed the directors or director of the same class whose
terms are then expiring. The terms of the Class I Directors, Class II
Directors and Class III Directors will expire upon the election and
qualification of successor directors at the annual meeting of stockholders
held during the calendar years 1998, 1999 and 2000, respectively. Mr. Hartley-
Leonard will become a Class I Director and Mr. Theobald will become a Class
III Director upon completion of the Offering.

Each officer serves at the discretion of the Board of Directors. There are
no family relationships among any of the directors and executive officers of
the Company.

BOARD OF DIRECTORS COMMITTEES

Effective upon the closing of the Offering, there will be two committees of
the Board of Directors of the Company: the Audit Committee and the
Compensation Committee. The members of the Audit Committee and the
Compensation Committee will be appointed prior to the closing of the Offering.
The Compensation Committee will review and approve all compensation, including
incentive compensation, for the executive officers of the Company and
administer the 1997 Stock Incentive Plan. The Audit Committee will review the
results and scope of the audit and other services provided by the Company's
independent auditors and will review and evaluate the Company's internal
control functions. The Audit Committee will consist of directors who are
neither officers, employees nor affiliates of the Company.

Pursuant to the Contribution and Exchange Agreement, as long as Galbreath
Holdings is the beneficial owner of at least ten percent of the Company's
outstanding Common Stock, it shall have the right to nominate one member to
the Board of Directors of the Company. Lizanne Galbreath was the initial
nominee of Galbreath Holdings.

DIRECTOR COMPENSATION

The Company's directors are not currently compensated. Following the
Offering, each non-employee director will receive an annual retainer of
$25,000, plus $1,000 for attendance at each meeting of the Board of Directors,
the Audit Committee or the Compensation Committee. In connection with the
Offering, each non-employee director will receive an initial grant of options
to purchase 5,000 shares of Common Stock at the initial public offering price.
Each non-employee director elected to the Board of Directors for the first
time thereafter will receive upon such election an initial grant of options to
purchase 5,000 shares of Common Stock at fair market value on the date of
grant. In addition, each non-employee director will receive an annual grant of
options to purchase 1,000 shares for each year during such director's term.
All of the foregoing options shall have a 10 year term and shall vest over a 5
year period, with 20% becoming vested on each anniversary of the date of
grant. In addition, a non-employee director may elect to receive, in lieu of
the annual cash retainer, stock options in an amount equal to the annual cash
retainer, net of the aggregate exercise price of the stock options, divided by
the then current market price of the Common Stock. Such stock options will
have an exercise price of $1.00 per share and an exercise period ending 10
years from December 31st of the year in which the retainer was earned. The
foregoing award of options will be granted automatically under the 1997 Stock
Incentive Plan.

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<PAGE>

EXECUTIVE COMPENSATION

Since the Company had no operating history prior to the date hereof, the
following table sets forth, for the year ended December 31, 1996, the cash
compensation paid to the Chief Executive Officer and the other five most
highly compensated executive officers of the Company (the "Named Executive
Officers") by the Predecessor Partnerships.

SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION (1)
---------------------------------
ALL OTHER
NAME AND PRINCIPAL POSITION SALARY BONUS COMPENSATION(2)
- --------------------------- -------- -------- ---------------
<S> <C> <C> <C>
Stuart L. Scott
Chairman of the Board of Directors
and Chief Executive Officer................. $336,000 $464,000 $ 14,203
Robert C. Spoerri
President and Chief Operating Officer....... 320,000 442,000 13,834
Daniel W. Cummings
Co-President--LaSalle Advisors Capital
Management, Inc............................. 260,000 352,000 12,447
Charles K. Esler, Jr.
President and Chief Executive Officer--
LaSalle Partners Management Services, Inc... 270,000 380,000 12,328
M. G. Rose
President, Tenant Representation Division--
LaSalle Partners Corporate & Financial
Services, Inc............................... 270,000 541,500 12,328
Lynn C. Thurber
Co-President--LaSalle Advisors Capital
Management, Inc............................. 260,000 352,000 245,500(3)
</TABLE>
- --------
(1) Represents total cash compensation paid to the Named Executive Officers
for all services rendered to the Predecessor Partnerships during the year
ended December 31, 1996.
(2) The amounts shown in this column consist of: (i) "tax gross up" payments
made in respect to certain compensation; (ii) premiums paid on life
insurance policies; and (iii) contributions by the Company to the
Company's 401(k) savings plan for the benefit of the Named Executive
Officers.
(3) Included under All Other Compensation for Ms. Thurber was $232,292 for
reimbursement of certain relocation expenses.

EMPLOYEE STOCK PURCHASE PLAN

The Company's 1997 Employee Stock Purchase Plan (the "Stock Purchase Plan")
is intended to qualify under Section 423 of the Internal Revenue Code of 1986
(the "Code"). Purchases under the Stock Purchase Plan will occur at the end of
each option period. The first option period will begin on January 1, 1998.
Thereafter, each option period will be a successive six-month purchase period.

The Stock Purchase Plan permits eligible employees to purchase Common Stock
through payroll deductions that may not exceed $21,250 per year. The purchase
price of Common Stock available under the Stock Purchase Plan is equal to 85%
of the fair market value of the Common Stock at the beginning or the end of a
purchase period, whichever is lower. Unless terminated sooner, the Stock
Purchase Plan will terminate 10 years from its effective date. The Board of
Directors has authority to amend or terminate the Stock Purchase Plan;
provided, no such action may adversely affect the rights of any participant.

1997 STOCK AWARD AND INCENTIVE PLAN

General. The 1997 Stock Incentive Plan provides for the grant of various
types of stock-based compensation to eligible participants. The purpose of the
1997 Stock Incentive Plan is to promote the success of the Company's business
in the best interests of its stockholders by providing incentives to those
individuals who are or will be responsible for such success.

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<PAGE>

The 1997 Stock Incentive Plan is designed to comply with the requirements of
Regulation G (12 C.F.R. (S)207), the requirements for "performance-based
compensation" under Section 162(m) of the Code and the conditions for
exemption from the short-swing profit recovery rules under Rule 16b-3 of the
Securities Exchange Act of 1934 (the "Exchange Act"). The summary that follows
is qualified by reference to the actual terms of the 1997 Stock Incentive
Plan.

The 1997 Stock Incentive Plan provides for the granting of stock options
("Options"), including "incentive stock options" ("ISOs") within the meaning
of Section 422 of the Code and non-qualified stock options. Options granted
under the 1997 Stock Incentive Plan may be accompanied by stock appreciation
rights or limited stock appreciation rights, or both ("Rights"). Rights may
also be granted independently of Options. The 1997 Stock Incentive Plan also
provides for the granting of restricted stock and restricted stock units
("Restricted Awards"), dividend equivalents, performance shares and other
stock- and cash-based awards. Pursuant to the 1997 Stock Incentive Plan,
certain additional options may be granted to non-employee directors (as more
fully described under the heading "Management--Director Compensation"). The
1997 Stock Incentive Plan also permits the plan's administrator to make loans
to participants in connection with the grant of awards, on terms and
conditions determined solely by the plan administrator. All awards will be
evidenced by an agreement (an "Award Agreement") setting forth the terms and
conditions applicable thereto.

Plan Administration. The 1997 Stock Incentive Plan is administered by the
Board of Directors, and from and after the Offering will be administered by a
committee of the Board of Directors, the composition of which will at all
times satisfy the provisions of Rule 16b-3 of the Exchange Act (such Board of
Directors or committee is sometimes referred to herein as the "Plan
Administrator"). Subject to the terms of the 1997 Stock Incentive Plan, the
Plan Administrator has the right to grant awards to eligible recipients and to
determine the terms and conditions of Award Agreements, including the vesting
schedule and exercise price of such awards, and the effect, if any, of a
change in control of the Company on such awards.

Shares Subject to the 1997 Stock Award and Incentive Plan. The 2,215,000
shares reserved for issuance under the 1997 Stock Incentive Plan may be
authorized but unissued shares of Common Stock or shares which have been or
may be reacquired by the Company in the open market, in private transactions
or otherwise.

Eligibility. Discretionary grants of Options, Rights, Restricted Awards and
dividend equivalents, performance shares and loans in connection therewith may
be made to any non-employee director, employee or any independent contractor
of the Company or its direct and indirect subsidiaries and affiliates who is
determined by the Plan Administrator to be eligible for participation in the
1997 Stock Incentive Plan, consistent with the purpose of such plan; provided
that ISOs may only be granted to employees of the Company and its
subsidiaries.

Exercise of Options. Options will vest and become exercisable over the
exercise period, at such times and upon such conditions, including amount and
manner of payment of the exercise price, as the Plan Administrator determines
and sets forth in the Award Agreement. The Plan Administrator may accelerate
the exercisability of any outstanding Option at such time and under such
circumstances as it deems appropriate. Options that are not exercised within
10 years from the date of grant, however, will expire without value. Options
are exercisable during the optionee's lifetime only by the optionee. The Award
Agreements will contain provisions regarding the exercise of Options following
termination of employment with or service to the Company, including
terminations due to the death, disability or retirement of an award recipient,
or upon a change in control of the Company.

Initial Grants. The Board of Directors has authorized the grant of options
to purchase shares of Common Stock under the 1997 Stock Incentive Plan at the
initial public offering price, upon the closing of the Offering. Such options
vest on the sixth anniversary of the date of grant, subject to earlier vesting
if the Company's Common Stock exceeds certain targeted trading prices
following the first anniversary of the date of grant. Of such options, 75,000
will be granted to each of Messrs. Scott and Spoerri, and 37,500 will be
granted to each of Messrs. Cummings, Esler and Rose and Ms. Thurber.

59
<PAGE>

EMPLOYEE STOCK OWNERSHIP GUIDELINES

Following the Offering, the Company will adopt stock ownership guidelines
for its executive officers and key employees (the "Covered Employees"). These
guidelines will require Covered Employees to maintain certain specified levels
of stock ownership based on a multiple of their annual compensation levels.
Compliance with such guidelines will be phased in over two, four or six years,
depending on the position of the Covered Employee. Failure to maintain such
ownership will disqualify the Covered Employee from participating in the
Company's option grant program.

STOCK COMPENSATION PROGRAM

The Predecessor Partnerships maintained a bonus compensation plan for
employees whose targeted annual compensation exceeded $100,000 (the "Bonus
Plan Employees"). Under such plan, Bonus Plan Employees were paid a percentage
of their total compensation in the form of limited partnership interests in
the Employee Partnerships. Following the Offering, the Company intends to
adopt a stock compensation program designed to continue the equity
participation emphasis of the earlier plan and to facilitate compliance with
the Company's equity ownership guidelines (the "Stock Compensation Program").
Under the Stock Compensation Program, each employee of the Company whose
targeted annual compensation equals or exceeds $100,000 (the "New Plan
Employees") may apply a specified percentage of his or her annual compensation
on a tax-deferred basis toward Common Stock or, at the direction of the
employee, for other applications made available by the administrator. If a New
Plan Employee elects to be credited with Common Stock, the total amount
credited in Common Stock (the "Allocation") will be increased by a percentage
(the "Equity Enhancement") sufficient to represent a 15% discount from the
fair market value of Common Stock. The number of shares issued in respect of
the Allocation and the Equity Enhancement will be based on the fair market
value of Common Stock when credited. Shares credited to New Plan Employees
which are attributable to the Allocation will be fully vested on the date of
grant and shares attributable to the Equity Enhancement will vest on the third
anniversary of the date of grant. The shares of Common Stock used for the
Stock Compensation Program will be shares which have or may be acquired by the
Company in the open market, in private transactions or otherwise.

EMPLOYMENT AGREEMENT

In April 1997, the Company entered into an employment agreement with Ms.
Galbreath as Chairman and Chief Executive Officer of Galbreath/LaSalle
Development Company (the "Employment Agreement"). The term of the Employment
Agreement is for the period from April 22, 1997 to December 31, 1997. The
Employment Agreement provides for a base salary and target bonus for calendar
year 1997 of $200,000 and $300,000, respectively, each to be pro-rated to
reflect the term of the agreement. Ms. Galbreath's bonus shall be determined
by the Company based on criteria used to determine the bonuses of other
members of management of the Company, and shall be payable in cash and Common
Stock. In addition, the Employment Agreement provides that Ms. Galbreath may
terminate her employment at any time, and that the Company may terminate her
employment under certain limited circumstances. The agreement further provides
that, commencing January 1, 1998, Ms. Galbreath's employment with the Company
shall continue subject to mutual agreement of the Company and Ms. Galbreath
from time to time, provided that the Company shall be obligated to pay to Ms.
Galbreath a separation payment equal to six months of her base salary if her
employment is terminated prior to December 31, 1998 for reasons other than as
set forth in the Employment Agreement.

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<PAGE>

PRINCIPAL AND SELLING STOCKHOLDERS

The following table sets forth certain information concerning the beneficial
ownership of the Common Stock immediately prior to and following the closing
of the Offering by: (i) each director of the Company; (ii) each director
nominee of the Company; (iii) each of the Named Executive Officers; (iv) the
directors, director nominees and executive officers of the Company as a group;
and (v) each person who at such time will beneficially own more than 5% of the
outstanding shares of Common Stock. DEL/LaSalle has granted the U.S.
Underwriters a 30-day option to purchase up to an aggregate of 600,000
additional shares of Common Stock on the same terms and conditions as the
Offering to cover over-allotments, if any, in connection with the Offering.
See "Shares Eligible for Future Sale" and "Underwriters."

<TABLE>
<CAPTION>
SHARES OF COMMON STOCK
BENEFICIALLY OWNED (1)
-----------------------------------
PERCENT
BEFORE PERCENT AFTER
NUMBER OFFERING OFFERING
--------- -------- -------------
DIRECTORS, DIRECTOR NOMINEES, EXECUTIVE
OFFICERS AND CERTAIN STOCKHOLDERS
- ---------------------------------------
<S> <C> <C> <C>
DEL-LPL Limited Partnership............... 5,054,175(2) 41.4% 31.2%
DSA-LSPL, Inc............................. 1,896,660(3) 15.6 11.7
c/o Dai-ichi Life (U.S.A.), Inc.
399 Park Avenue, 24th Floor
New York, New York 10022
DEL/LaSalle Finance Company, L.L.C........ 1,826,548(4) 15.0 11.3
DEL-LPAML Limited Partnership............. 891,913(5) 7.3 5.5
Galbreath Holdings, LLC................... 1,727,027(6) 14.2 10.7
Stuart L. Scott........................... (7)(8)
Robert C. Spoerri......................... (7)(9)
William E. Sullivan....................... (10)
Daniel W. Cummings........................ (7)(11)
Charles K. Esler.......................... (12)
Lizanne Galbreath......................... (13)
M.G. Rose................................. (7)(14)
Lynn C. Thurber........................... (7)(15)
Earl E. Webb.............................. (7)(16)
Darryl Hartley-Leonard.................... --
Thomas C. Theobald........................ --
All directors, director nominees and
executive officers as a group
(11 persons)............................. (17)
</TABLE>
- --------
(1) Beneficial ownership prior to the consummation of the Incorporation
Transactions has not been included because there were outstanding only a
nominal number of shares of Common Stock. Unless otherwise indicated,
each person listed above has sole investment and voting power with
respect to the shares listed. Each of Messrs. Scott, Spoerri, Sullivan,
Cummings, Esler, Rose and Webb, and Ms. Thurber are partners in the
Employee Partnerships. The number of shares of Common Stock beneficially
owned by each does not include the 5,054,175 shares owned by DEL-LPL, the
891,913 shares owned by DEL-LPAML and the 1,826,548 shares (1,226,548
shares of Common Stock if the over-allotment option is exercised in full)
owned by DEL/LaSalle. Unless otherwise indicated, the address of each
person or entity is c/o LaSalle Partners Incorporated, 200 East Randolph
Street, Chicago, IL 60601.

(2) Does not include the 891,913 shares of Common Stock owned by DEL-LPAML,
one of the Employee Partnerships, or the 1,826,548 shares of Common Stock
owned by DEL/LaSalle, which is 85% owned by DEL-LPL. Includes 762,675
shares of Common Stock attributable to partnership interests of former
employees of the Predecessor Partnerships.

(3) Does not include the 334,705 shares of Common Stock owned by DSA-LSAM,
Inc., an entity under common ownership with DSA-LSPL, Inc.

(Footnotes continued on following page)

61
<PAGE>

(4) DEL/LaSalle, the "Selling Stockholder" has granted the U.S. Underwriters a
30-day option to purchase 600,000 shares of Common Stock on the same terms
and conditions as the Offering. All of the outstanding membership
interests in DEL/LaSalle are owned by the Employee Partnerships. See
"Incorporation Transactions."
(5) Includes 134,590 shares of Common Stock attributable to partnership
interests held by former employees of the Predecessor Partnerships.

(6) Does not include the 468,972 shares of Common Stock owned by Galbreath-
LPL. Galbreath Holdings is the non-member manager of Galbreath-LPL and,
therefore, might be deemed to be the beneficial owner of such shares for
purposes of Rule 13d-3 ("Rule 13d-3") promulgated pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
Galbreath Holdings disclaims beneficial ownership of such shares of Common
Stock.
(7) Does not include the 5,054,175 shares of Common Stock owned by DEL-LPL,
one of the Employee Partnerships, of which the listed person, as the sole
stockholder of a general partner of DEL-LPL, might be deemed to be the
beneficial owner for purposes of Rule 13d-3. Also does not include the
1,826,548 shares of Common Stock of DEL/LaSalle, which is 85% owned by
DEL-LPL. The listed person disclaims beneficial ownership of the shares of
Common Stock owned by DEL-LPL and DEL/LaSalle.
(8) Mr. Scott, either directly or through an affiliate, owns a 9.5% interest
in the Employee Partnerships, on a fully-diluted basis. Mr. Scott owns all
of the issued and outstanding common stock of DEL-SLS, Inc., a general
partner of DEL-LPL.
(9) Mr. Spoerri, either directly or through an affiliate, owns a 6.8% interest
in the Employee Partnerships, on a fully-diluted basis. Mr. Spoerri owns
all of the issued and outstanding common stock of DEL-RCS, Inc., a general
partner of DEL-LPL.
(10) Mr. Sullivan owns a 1.0% limited partnership interest in the Employee
Partnerships, on a fully-diluted basis.
(11) Mr. Cummings, either directly or through an affiliate, owns a 2.6%
interest in the Employee Partnerships, on a fully-diluted basis. Mr.
Cummings owns all of the issued and outstanding common stock of DEL-DWC,
Inc., a general partner of DEL-LPL.

(12) Mr. Esler, either directly or through an affiliate, has a 2.4% interest in
the Employee Partnerships, on a fully diluted basis. Mr. Esler owns all of
the issued and outstanding common stock of DEL-CKE, Inc., a general
partner of DEL-LPAML, one of the Employee Partnerships. Does not include
the 891,913 shares of Common Stock owned by DEL-LPAML of which Mr. Esler
might be deemed to be the beneficial owner for purposes of Rule 13d-3.
Also does not include the 1,826,548 shares of Common Stock of DEL/LaSalle,
which is 15% owned by DEL-LPAML. Mr. Esler disclaims beneficial ownership
of the shares of Common Stock owned by DEL-LPAML and DEL/LaSalle.
(13) Ms. Galbreath owns, either directly or through a trust for which she is
the sole beneficiary, a 45.0% interest in, and is the managing member of,
Galbreath Holdings. Ms. Galbreath also owns a 40.3% interest in Galbreath-
LPL. Because Ms. Galbreath is the non-member manager of Galbreath Holdings
and Galbreath Holdings is the managing member of Galbreath-LPL, Ms.
Galbreath might be deemed to be the beneficial owner of all shares of
Common Stock owned by Galbreath Holdings and Galbreath-LPL for purposes of
Rule 13d-3. Ms. Galbreath disclaims beneficial ownership of such shares of
Common Stock, except to the extent of her ownership interests.
(14) Mr. Rose, either directly or through an affiliate, owns a 5.87% interest
in the Employee Partnerships, on a fully-diluted basis. Mr. Rose is a
general partner of DEL-LPL.
(15) Ms. Thurber, either directly or through an affiliate, owns a 1.9% interest
in the Employee Partnerships, on a fully-diluted basis. Ms. Thurber owns
all of the issued and outstanding common stock of DEL-LCT, Inc., a general
partner of DEL-LPL.
(16) Mr. Webb, either directly or through an affiliate, owns a 1.3% interest in
the Employee Partnerships. Mr. Webb owns all of the issued and outstanding
common stock of DEL-EEW, Inc., a general partner of DEL-LPL.
(17) See footnotes (7)-(16) above.

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<PAGE>

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Messrs. Scott, Spoerri, Rose, Esler and Cummings, as well as entities
affiliated with Messrs. Scott and Spoerri, are limited partners of Diverse.
Diverse has an ownership interest in and operates investment assets, primarily
as the managing general partner of real estate development ventures. Prior to
January 1, 1992, the Company earned fees for providing development advisory
services to Diverse as well as fees for the provision of administrative
services. Effective January 1, 1992, the Company discontinued charging fees to
Diverse for these services. At the end of 1994, 1995 and 1996, the total
receivable due from Diverse in connection with such
fees and interest thereon was $5.3 million, $3.4 million and $2.4 million,
respectively. In 1992, Diverse began the process of discontinuing its
operations and disposing of its assets. Diverse made a payment of $1.5 million
in 1994 and $1.0 million in 1996 to reduce the receivable due to the Company.
In 1995, the Company recorded a $1.9 million provision for the estimated
uncollectible portion of the receivable due to the Company by Diverse. Messrs.
Scott, Spoerri, Rose, Esler and Cummings directly hold an approximately 11.9%,
2.2%, 2.5%, .3% and .3% partnership interest in Diverse, respectively. In
addition, the Stuart Scott Trust and Lakewood Equities, entities affiliated
with Messrs. Scott and Spoerri, have a 5.7% and .7% partnership interest in
Diverse, respectively. Diverse did not make distributions to its partners in
1994, 1995 or 1996.

In addition, the Company provides property management and leasing services
to properties in which Diverse has an ownership interest. At the end of 1994,
1995 and 1996, the total receivable due from these properties was $.6 million,
$.3 million and $45,000, respectively. The properties made payments to the
Company in each of those years totaling $1.8 million, $1.7 million and $.9
million, respectively. The Company believes that the services provided to
properties in which Diverse has an ownership interest are on terms no more
favorable than those given to unaffiliated persons.

The Company provides certain administrative services to the Employee
Partnerships for which the Company is not reimbursed. For the years ended
December 31, 1994, 1995 and 1996, respectively, the Company believes that the
estimated value of the services provided to the Employee Partnerships was $.3
million, $.2 million and $.3 million. It is expected that after the closing of
the Offering, the Company will continue to provide such services to the
Employee Partnerships without charge. After the Incorporation Transactions,
the Company expects that the value of such services will be substantially
lower.

Through an affiliated entity, Mr. Scott beneficially owns all of the
outstanding shares of common stock of LP Finance 1996-1 Corporation ("LP
Finance"). LP Finance owns a 37.3% limited partnership interest in FBEC--One
Urban Centre, L.P. ("One Urban"), which interest is expected to be exchanged
for an interest in Florida Business Environment Company, L.P. ("FBEC"), a fund
being organized by the Company to invest in real estate in Florida (One Urban
and FBEC together, the "Florida Fund"). LP Finance's percentage interest in
FBEC would be determined by the total amount of capital ultimately raised. Mr.
Scott is also a director and the president and chairman of the board of
LaSalle FOF, Inc. ("LaSalle FOF"), the general partner of the Florida Fund.
Mr. Scott also owns approximately 37.3% of the outstanding shares of common
stock of LaSalle FOF. Since December 1996, the Company has provided and
continues to provide investment management services to the Florida Fund. The
Company earns an annual advisory fee of $.1 million plus a percentage of the
fund properties' net operating income and may earn an additional fee equal to
a percent of profits in excess of profits providing a specified internal rate
of return. A new advisory agreement is currently being negotiated pursuant to
which the Company would earn an annual advisory fee equal to a percentage of
the fund properties' net operating income and may earn an additional fee equal
to a percent of profits in excess of profits providing a specified internal
rate of return. The Company was also paid an acquisition fee of $.2 million in
connection with a property purchased by the fund. The Company believes that
the services provided to the Florida Fund are on terms no more favorable to
the fund than those terms given to unaffiliated persons.

The Company provides property management and leasing and investment
management services to Dai-ichi and affiliates of Dai-ichi. For the years
ended December 31, 1994, 1995 and 1996, respectively, Dai-ichi paid $16.4
million, $9.3 million and $11.6 million for such services. At the end of such
years, the Company had

63
<PAGE>

receivables of $4.9 million, $3.6 million and $2.5 million due from Dai-ichi
with respect to such services. The Company believes that the services provided
to Dai-ichi and its affiliates are on terms no more favorable to Dai-ichi than
those available to unaffiliated persons. The Company has also issued to Dai-
ichi the Dai-ichi Notes, which will be repaid out of the net proceeds to the
Company from the Offering. At each of December 31, 1994, 1995 and 1996,
respectively, an aggregate of $37.2 million, was outstanding under the Dai-
ichi Notes. The largest aggregate indebtedness outstanding under the Dai-ichi
Notes since January 1, 1994 was $51.3 million. In 1994, a principal payment of
$14.1 million was made on the Class A Notes. See "Use of Proceeds" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations--Liquidity and Capital Resources."

In 1996, approximately $3.8 million of the revenues generated by Galbreath
were derived from real estate properties that were owned, in part, by entities
that Ms. Galbreath and the members of her immediate family control (the
"Galbreath Affiliates"). In 1996, Galbreath also paid leasing commissions,
rent and other operating expenses of $.3 million to the Galbreath Affiliates.
The Company believes that the services provided to the Galbreath Affiliates
and the agreements regarding said leasing commissions, rent and operating
expenses are on terms no more favorable to the Galbreath Affiliates than those
available to unaffiliated persons.

In connection with the Incorporation Transactions and the merger of
Galbreath with the Company, the Company granted certain registration rights to
Dai-ichi, the Employee Partnerships and the former stockholders of Galbreath
with respect to the shares of Common Stock to be issued to them in the
Incorporation Transactions. See "Risk Factors--Shares Eligible for Future
Sale," "Incorporation Transactions" and "Shares Eligible for Future Sale--
Registration Rights."

DESCRIPTION OF CAPITAL STOCK

The following description briefly summarizes certain information regarding
the capital stock of the Company. This information does not purport to be
complete and is subject in all respects to the applicable provisions of the
Maryland General Corporation Law, as amended, the Restated Articles of
Incorporation and the Bylaws.

The Board of Directors is authorized to reclassify any unissued portion of
the authorized shares of capital stock to provide for the issuance of shares
in other classes or series, including preferred stock in one or more series,
to establish the number of shares in each class or series and to fix the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemption of such class or series.

The authorized capital stock of the Company consists of (i) 100,000,000
shares of common stock, $.01 par value per share and (ii) 10,000,000 shares of
Preferred Stock, $.01 par value per share ("Preferred Stock"). Upon the
closing of the Offering, 16,200,000 shares of Common Stock will be issued and
outstanding. The Company has no shares of Preferred Stock issued and
outstanding, nor will any shares of Preferred Stock be issued and outstanding
upon the closing of the Offering.

COMMON STOCK

Each share of Common Stock entitles the holder thereof to one vote on all
matters submitted to a vote of stockholders, including the election of
directors. There is no cumulative voting in the election of directors.
Consequently, the holders of a majority of the outstanding shares of Common
Stock can elect all of the directors then standing for election.

Holders of the Common Stock are entitled to receive ratably such dividends,
if any, as may be declared from time to time by the Board of Directors out of
funds legally available therefor. See "Dividend Policy." Holders of Common
Stock have no conversion, preemptive or other rights to subscribe for any
securities of the Company, and there are no redemption or sinking fund
provisions with respect to such shares. All outstanding

64
<PAGE>

shares of Common Stock are, and the shares to be sold in the Offering when
issued and paid for will be, validly issued, fully paid and nonassessable. In
the event of any liquidation, dissolution or winding-up of the affairs of the
Company, holders of Common Stock will be entitled to share ratably in the
assets of the Company remaining after provision for payment of liabilities to
creditors. The rights, preferences and privileges of holders of Common Stock
are subject to the rights of the holders of any shares of Preferred Stock and
any additional classes of stock which the Company may issue in the future.

PREFERRED STOCK

The Restated Articles of Incorporation authorize the Board of Directors to
create and issue up to 10,000,000 shares of Preferred Stock in one or more
classes or series and to fix for each such class or series the voting powers,
designations, preferences and relative, participating, optional or other
special rights and any qualifications, limitations or restrictions thereof.
Upon the closing of the Offering, none of such shares will be outstanding. The
Board of Directors is authorized to, among other things, provide that any such
class or series of Preferred Stock may be (i) subject to redemption at such
time or times and at such price or prices as the Board may establish; (ii)
entitled to receive dividends (which may be cumulative or non-cumulative) at
such rates, on such conditions, and at such times, and payable in preference
to, or in such relation to, the dividends payable on any other class or
classes or any other series as the Board may establish; (iii) entitled to such
rights upon the dissolution of, or upon any distribution of the assets of, the
Company as the Board may establish; or (iv) convertible into, or exchangeable
for, shares of any other class or classes of stock, or of any other series of
the same or any other class or classes of stock, of the Company at such price
or prices or at such rates of exchange and with such adjustments as the Board
may establish. Issuance of Preferred Stock could discourage bids for the
Common Stock at a premium as well as create a depressive effect on the market
price of the Common Stock.

ADDITIONAL CLASSES OF STOCK

Additional classes of stock, including preferred stock, may be issued from
time to time, in one or more series, as authorized by the Board of Directors.
Prior to issuance of shares of each series, the Board of Directors is required
by the MGCL and the Company's Restated Articles of Incorporation to set for
each such series the preferences, conversion or other rights, voting powers,
restrictions, limitations as to the dividends or other distributions,
qualifications and terms or conditions of redemption, as are permitted under
Maryland law. The Board of Directors could authorize the issuance of capital
stock with terms and conditions which could have the effect of discouraging a
takeover or other transaction which holders of some, or a majority, of the
Common Stock might believe to be in their best interests or in which holders
of some, or a majority, of the Common Stock might receive a premium for their
Common Stock over the then market price of such Common Stock. As of the date
hereof, no such additional classes of stock are outstanding and the Company
has no present plans to issue any such stock.

LIABILITY OF DIRECTORS AND OFFICERS; INDEMNIFICATION

The Restated Articles of Incorporation contain provisions which eliminate
the personal liability of a director or officer to the Company and its
stockholders for breaches of fiduciary duty to the fullest extent provided by
law. Under Maryland law, however, these provisions do not eliminate or limit
the personal liability of a director or officer (i) to the extent that it is
proved that the director or officer actually received an improper benefit or
profit or (ii) if a judgment or other final adjudication is entered in a
proceeding based on a finding that the directors' or officers' action, or
failure to act, was the result of active and deliberate dishonesty and was
material to the cause of action adjudicated in such proceeding. These
provisions do not affect the ability of the Company or its stockholders to
obtain equitable relief, such as an injunction or rescission.

The Restated Articles of Incorporation and Bylaws provide that the Company
shall indemnify and advance expenses to its directors and officers to the
fullest extent permitted by the MGCL, and that the Company shall indemnify and
advance expenses to its officers to the same extent as its directors and to
such further extent as is consistent with law. The MGCL provides that a
corporation may indemnify any director made a party to any

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proceeding by reason of service in that capacity unless it is established that
(i) the act or omission of the director was material to the matter giving rise
to the proceeding and (a) was committed in bad faith or (b) was the result of
active and deliberate dishonesty, or (ii) the director actually received an
improper personal benefit in money, property or services, or (iii) in the case
of any criminal proceeding, the director had reasonable cause to believe that
the act or omission was unlawful. The statute permits Maryland corporations to
indemnify their officers, employees or agents to the same extent as its
directors and to such further extent as is consistent with law.

The Company intends to obtain directors' and officers' liability insurance
("D&O Insurance") prior to the effective date of the Offering, and expects to
maintain such insurance following such date. In addition, the Company will
enter into an indemnification agreement with each of its directors and certain
officers of the Company under which the Company will indemnify each of them
against expenses and losses incurred for claims brought against them by reason
of being a director or officer of the Company. The Company expects that the
indemnification agreements will indemnify and advance expenses to its
directors and officers to the fullest extent permitted by the MGCL.

The Company believes that the limitation of liability and indemnification
provisions in the Restated Articles of Incorporation, the D&O Insurance and
the indemnification agreements will enhance the Company's ability to continue
to attract and retain qualified individuals to serve as directors and
officers. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers or persons controlling
the Company pursuant to the foregoing provisions, the Company has been
informed that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act
and is therefore unenforceable.

CERTAIN ARTICLES OF INCORPORATION, BYLAW AND STATUTORY PROVISIONS AFFECTING
STOCKHOLDERS

Certain provisions in the Restated Articles of Incorporation and Bylaws and
the MGCL may have the effect of delaying, deferring or preventing a change of
control of the Company or may operate only with respect to extraordinary
corporate transactions involving the Company.

The Restated Articles of Incorporation provides for the Board of Directors
to be divided into three classes, as nearly equal in number as possible,
serving staggered terms. Approximately one-third of the Board will be elected
each year. See "Management." A director may be removed by the stockholders,
but only for cause, and only by the affirmative vote of the holders, voting as
a single class, of two-thirds of the voting power of the Company's then
outstanding capital stock entitled to vote generally in the election of
directors. The Company believes that classification of the Board of Directors
will help to assure the continuity and stability of the Company's business
strategies and policies as determined by the Board of Directors. The provision
for a classified board, together with the director removal provisions, could
prevent a party who acquires control of a majority of the outstanding voting
stock from obtaining control of the Board until the second annual stockholders
meeting following the date the acquiror obtains the controlling stock
interest. The classified board provision, together with the director removal
provisions, could have the effect of discouraging a potential acquiror from
making a tender offer or initiating a proxy contest or otherwise attempting to
gain control of the Company and could increase the likelihood that incumbent
directors will retain their positions.

The Bylaws provide that stockholders at an annual meeting may only consider
proposals or nominations specified in the notice of meeting or brought before
the meeting by or at the direction of the Board or by a stockholder who was a
stockholder of record on the record date for the meeting, who is entitled to
vote at the meeting and who has given to the Company's Secretary timely
written notice, in proper form, of the stockholder's intention to bring that
proposal or nomination before the meeting. In addition to certain other
applicable requirements, for a stockholder proposal or nomination to be
properly brought before an annual meeting by a stockholder, such stockholder
generally must have given notice thereof in proper written form to the
Secretary of the Company not less than 90 days nor more than 120 days prior to
the anniversary date of the immediately preceding annual meeting of
stockholders. Although the Bylaws do not give the Board the power to approve
or disapprove stockholder nominations of candidates or proposals regarding
other business to be

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conducted at a special or annual meeting, the Bylaws may have the effect of
precluding the conduct of certain business at a meeting if the proper
procedures are not followed or may discourage or defer a potential acquiror
from conducting a solicitation of proxies to elect its own slate of directors
or otherwise attempting to obtain control of the Company.

Pursuant to the MGCL, the Bylaws permit stockholders to call special
meetings of stockholders upon written request of holders of shares entitled to
cast not less than a majority of all votes entitled to be cast at such
meeting. The Bylaws provide that only business specified in the notice of a
special meeting will be conducted at such meeting. Such provisions do not,
however, affect the ability of stockholders to submit a proposal to the vote
of all stockholders of the Company at an annual meeting in accordance with the
Bylaws, which provide for the additional notice requirements for stockholder
nominations and proposals at the annual meetings of stockholders as described
above. In addition, pursuant to the MGCL, the Bylaws provide that any action
required to be taken at a meeting of the stockholders may be taken without a
meeting by unanimous written consent, if such consent sets forth such action
and is signed by each stockholder entitled to vote on the matter and a written
waiver of any right to dissent signed by each stockholder entitled to notice
of the meeting but not entitled to vote thereat.

The Restated Articles of Incorporation and Bylaws provide that the
affirmative vote of at least 80% of the total votes eligible to be cast in the
election of directors is required to amend, alter, change or repeal certain of
their provisions. This requirement of a super-majority vote to approve
amendments to certain provisions of the Restated Articles of Incorporation and
Bylaws could enable a minority of the Company's stockholders to exercise veto
power over any such amendments.

Under the MGCL, certain "Business Combinations" (including a merger,
consolidation, share exchange or, in certain circumstances, an asset transfer
or issuance or reclassification of equity securities) between a Maryland
corporation and any person who beneficially owns 10% or more of the voting
power of the corporation's shares or an affiliate of the corporation who, at
any time within the two-year period prior to the date in question, was the
beneficial owner of 10% or more of the voting power of the then-outstanding
voting stock of the corporation (an "Interested Stockholder") or an affiliate
thereof are prohibited for five years after the most recent date on which the
Interested Stockholder became an Interested Stockholder. Thereafter, any such
Business Combination must be recommended by the Board of Directors of such
corporation and approved by the affirmative vote of at least (i) 80% of the
votes entitled to be cast by holders of outstanding voting shares of the
corporation and (ii) 66 2/3% of the votes entitled to be cast by holders of
outstanding voting shares of the corporation other than shares held by the
Interested Stockholder with whom the Business Combination is to be effected,
unless, among other things, the corporation's stockholders receive a minimum
price (as defined in the MGCL) for their shares and the consideration is
received in cash or in the same form as previously paid by the Interested
Stockholder for its shares. It is anticipated that the Company's Board of
Directors will exempt from the Maryland statute any business combination with
the Employee Partnerships, any present or future affiliate or associate of any
of them, or any other person acting in concert or as a group with any of the
foregoing persons. Pursuant to the MGCL, these provisions also do not apply to
Business Combinations which are approved or exempted by the Board of Directors
of the corporation prior to the time that the Interested Stockholder becomes
an Interested Stockholder.

The Company will elect to include in its Restated Articles of Incorporation
provisions exempting it from the application of the Maryland control share
acquisition statute.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the Common Stock is Harris Trust and
Savings Bank. Application has been made to list the Common Stock on the New
York Stock Exchange under the symbol "LAP."

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<PAGE>

SHARES ELIGIBLE FOR FUTURE SALE

Upon the closing of this Offering, the Company will have approximately
16,200,000 shares of Common Stock outstanding. The 4,000,000 shares of Common
Stock sold in this Offering (4,600,000 shares if the Underwriters' over-
allotment option is exercised in full) will be freely tradable without
restriction under the Securities Act, except for any such shares held at any
time by an "affiliate" of the Company, as such term is defined under Rule 144
promulgated under the Securities Act.

The remaining 12,200,000 shares of Common Stock outstanding upon the closing
of the Offering (11,600,000 if the Underwriters exercise in full the over-
allotment option) will be owned by the Employee Partnerships, including
DEL/LaSalle, the former Galbreath stockholders and affiliates of Dai-ichi and
may be publicly sold only if such Common Stock is registered under the
Securities Act or sold in accordance with an applicable exemption from
registration, such as Rule 144. In general, under Rule 144, as currently in
effect, a person who has beneficially owned shares for at least one year,
including an "affiliate," as that term is defined in Rule 144, is entitled to
sell, within any three-month period, a number of "restricted" shares that does
not exceed the greater of one percent (1%) of the then outstanding shares of
Common Stock (approximately 162,000 shares immediately after the Offering) or
the average weekly trading volume during the four calendar weeks preceding
such sale. Sales under Rule 144 are also subject to certain manner of sale
limitations, notice requirements and the availability of current public
information about the Company. Rule 144(k) provides that a person who is not
deemed an "affiliate" and who has beneficially owned shares for at least two
years is entitled to sell such shares at any time under Rule 144 without
regard to the limitations described above.

Under the terms of the partnership agreement of the Employee Partnerships,
partners thereof generally will be entitled to receive upon their withdrawal
from the Employee Partnerships, death or incapacity, or upon request, up to
that number of shares of Common Stock held by the Employee Partnerships which
represents their pro rata interest in the shares of Common Stock held by the
Employee Partnerships. Partners of the Employee Partnerships who receive
shares upon their withdrawal or by election will not be subject to any
contractual restrictions on resale with respect to shares of the Common Stock
received by them but will be subject to the restrictions on transfer described
above. However, unless such shares are registered for sale under the
Securities Act, for purposes of Rule 144 they would be considered "restricted
securities" and would be subject to the limitations on sale pursuant to Rule
144 described above. For the purposes of determining compliance with the
volume limitations of Rule 144, all sales of Common Stock by partners of the
Employee Partnerships will generally be aggregated. In addition, the holding
period for partners of the Employee Partnerships under Rule 144 will generally
include the holding period of the Employee Partnerships.

The Company will agree with the Underwriters, subject to certain exceptions,
not to sell or otherwise dispose of any shares of Common Stock for a period of
180 days from the date of this Prospectus without the prior written consent of
Morgan Stanley & Co. Incorporated. Each of the Company's current stockholders
will enter into or is bound by a similar agreement. See "Underwriters."

The Company is unable to estimate the number of shares of Common Stock that
may be sold in the future by the existing stockholders or the effect, if any,
that sales of shares by such stockholders will have on the market price of the
Common Stock prevailing from time to time. Sales of substantial amounts of
Common Stock by such stockholders, or the perception that such sales could
occur, could adversely affect prevailing market prices.

In March 1997, DEL/LaSalle, a limited liability company whose only members
are the Employee Partnerships, purchased the limited partnership interests in
the Predecessor Partnerships owned by a subsidiary of Dresdner. Dresdner was
required to sell the interests in order to comply with bank regulatory
requirements. As consideration for such purchase, DEL/LaSalle issued to
Dresdner the Dresdner Note. The purchase price was determined in May 1996 and
was based on the original purchase price for such interests plus Dresdner's
share of expected undistributed earnings for 1996. All of the 1,826,548 shares
of Common Stock to be received by DEL/LaSalle in connection with the
Incorporation Transactions and 2,831,150 of the shares of Common Stock held by
the Employee Partnerships, representing an aggregate of approximately 29% of
the outstanding Common

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<PAGE>

Stock after giving effect to the Offering, will be pledged to support
DEL/LaSalle's obligations under the Dresdner Note. The principal amount of the
Dresdner Note is due in five installments, with $3.5 million due on April 15,
2000 and $7.8 million due on each April 15 thereafter, through 2004. The
Dresdner Note bears interest at 7.0% per annum, payable on each April 15
beginning on April 15, 1998. DEL/LaSalle will not have any assets other than
the Common Stock issued in connection with the Incorporation Transactions.
Funds for repayment of the Dresdner Note, including interest thereon, will be
provided by capital contributions from the Employee Partnerships and through
the sale of Common Stock in the public market or in privately negotiated
transactions. DEL/LaSalle has granted the U.S. Underwriters a 30-day option to
purchase up to 600,000 shares of Common Stock to cover over-allotments in
connection with the Offering. In the event that the Underwriters' over-
allotment option is exercised, the proceeds to DEL/LaSalle will be used to
repay a portion of the Dresdner Note. If an event of default occurs under the
Dresdner Note, Dresdner will have the right to sell any or all of the pledged
shares in the public market or in privately negotiated transactions, subject
to compliance with the Securities Act and applicable law.

REGISTRATION RIGHTS

In connection with the merger of Galbreath with Predecessor Partnerships,
the Company entered into a Registration Rights Agreement (the "Registration
Rights Agreement") by and among the Employee Partnerships, affiliates of Dai-
ichi, an entity formed by the former Galbreath stockholders (each a "Current
Stockholder") and the Company. The Registration Rights Agreement provides
that, subject to certain limitations, at any time following 12 months from the
date of closing of the Offering (the "Effective Date"), each Current
Stockholder has the right to demand, on no more than two occasions, that the
Company register all or a portion of the shares of Common Stock owned by such
stockholder at the Effective Date, subject to a minimum demand of 20.0% of the
total shares originally issued to such stockholder or a lesser percentage if
the anticipated aggregate price to the public would exceed $5.0 million. The
Company will be required to use its best efforts to effect any such
registration on demand. Such registrations will be at the Company's expense,
except that each selling stockholder will bear its pro rata share of the
underwriting discounts and commissions.

In addition, at any time after the expiration of 12 months from the
Effective Date, the Current Stockholders will have certain incidental rights
to require the Company to include in any registration statement filed by the
Company with respect to its securities (whether for its own account or for the
account of any securityholder) such amount of shares of Common Stock requested
by the Current Stockholders to be included therein, subject to certain
exceptions. Such registrations will be at the Company's expense, except that
each selling stockholder will bear its pro rata share of the underwriting
discounts and commissions.

The Registration Rights Agreement also provides that, prior to the transfer
of Common Stock by the Current Stockholders, such stockholders must provide
notice to the Company of the proposed transfer unless the proposed transfer is
to one of the Current Stockholders, certain institutional investors, persons
who would own after the transfer less than 5.0% of the Company's outstanding
Common Stock, purchasers pursuant to Rule 144 under the Securities Act, or to
an underwriter in a firm commitment underwriting. The Company will then have
the option of purchasing the shares proposed to be transferred at a price
equal to the average closing market price of Common Stock during the five
trading days prior to such notice.

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<PAGE>

CERTAIN U.S. FEDERAL TAX CONSIDERATIONS
FOR NON-U.S. HOLDERS OF COMMON STOCK

The following is a general discussion of certain United States federal
income and estate tax consequences of the ownership and disposition of Common
Stock applicable to "Non-United States Holders." Subject to the discussion
below under "Estate Tax," a "Non-United States Holder" is any beneficial owner
of Common Stock that, for United States federal income tax purposes is a non-
resident alien individual, a foreign corporation, a foreign partnership or a
foreign estate or trust as such terms are defined in the Internal Revenue Code
of 1986, as amended (the "Code"). This discussion is based on the Code,
existing, proposed and temporary regulations promulgated thereunder, and
administrative and judicial interpretations as of the date thereof, all of
which are subject to change either retroactively or prospectively. This
discussion does not address all aspects of United States federal income and
estate taxation that may be relevant to Non-United States Holders in light of
their particular circumstances and does not address any tax consequences
arising under the laws of any state, local or foreign taxing jurisdiction or
the application of a particular tax treaty. Prospective investors are urged to
consult their tax advisors regarding the United States federal, state and
local income and other tax consequences, and the non-United States tax
consequences, of owning and disposing of Common Stock.

Proposed United States Treasury Regulations were issued on April 15, 1996
(the "Proposed Regulations") which, if adopted, could effect the United States
taxation of dividends on Common Stock paid to a Non-United States Holder. The
Proposed Regulations are generally proposed to be effective with respect to
dividends paid after December 31, 1997, subject to certain transition rules.
It cannot be predicted at this time whether the Proposed Regulations will be
adopted as proposed or what modifications, if any, may be made to them. The
discussion below is not intended to include a complete discussion of the
provisions of the Proposed Regulations, and prospective investors are urged to
consult their tax advisors with respect to the effect the Proposed Regulations
may have if adopted.

DIVIDENDS

Subject to the discussion below, any dividend paid to a Non-United States
Holder generally will be subject to United States withholding tax either at a
rate of 30% of the gross amount of the dividend or such lower rate as may be
specified by an applicable tax treaty. For purposes of determining whether tax
is to be withheld at a 30% rate or at a reduced rate as specified by an
applicable tax treaty, under current United States Treasury Regulations the
Company ordinarily will presume that dividends paid to a holder with an
address in a foreign country are paid to a resident of such country absent
knowledge that such presumption is not warranted. Under such Regulations,
dividends paid to a holder with an address within the United States generally
will be presumed to be paid to a holder who is not a Non-United States Holder
and will not be subject to the 30% withholding tax, unless the Company has
actual knowledge that the holder is a Non-United States Holder.

The Proposed Regulations would provide for certain presumptions (which
differ from those described above) upon which the Company may generally rely
to determine whether, in the absence of certain documentation, a holder should
be treated as a Non-United States Holder for purposes of the 30% withholding
tax described above. The presumptions would not apply for purposes of granting
a reduced rate of withholding under a treaty. Under the Proposed Regulations,
to obtain a reduced rate of withholding under a treaty a Non-United States
Holder would generally be required to provide an Internal Revenue Service Form
W-8 certifying such Non-United States Holder's entitlement to benefits under a
treaty. The Proposed Regulations also would provide special rules to determine
whether, for purposes of determining the applicability of a tax treaty and for
purposes of the 30% withholding tax described above, dividends paid to a Non-
United States Holder that is an entity should be treated as paid to the entity
or those holding an interest in that entity.

Dividends received by a Non-United States Holder that are effectively
connected with a United States trade or business conducted by such Non-United
States Holder are exempt from withholding tax. However, such effectively
connected dividends are subject to regular United States income tax in the
same manner as if the

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<PAGE>

Non-United States Holder were a United States person for federal income tax
purposes. A Non-United States Holder may claim exemption from withholding
under the effectively connected income exception by filing Internal Revenue
Service Form 4224 (Exemption From Withholding of Tax on Income Effectively
Connected With the Conduct of a Trade or Business in the United States) each
year with the Company or its paying agent prior to the payment of the
dividends for such year. The Proposed Regulations would replace Form 4224 with
Form W-8. Effectively connected dividends received by a corporate Non-United
States Holder may be subject to additional "branch profits tax" at a rate of
30% (or such lower rate as may be specified by an applicable tax treaty) of
such corporate Non-United States Holder's effectively connected earnings and
profits, subject to certain adjustments.

A Non-United States Holder eligible for a reduced rate of United States
withholding tax pursuant to a tax treaty may obtain a refund of any excess
amounts withheld by filing an appropriate claim for refund with the United
States Internal Revenue Service ("IRS").

GAIN ON DISPOSITION OF COMMON STOCK

A Non-United States Holder generally will not be subject to United States
federal income tax with respect to gain realized upon the sale or other
disposition of Common Stock unless (i) such gain is effectively connected with
a United States trade or business of the Non-United States Holder; (ii) the
Non-United States Holder is an individual who holds the Common Stock as a
capital asset, is present in the United States for a period or periods
aggregating 183 days or more during the taxable year in which such sale or
disposition occurs, and certain other conditions are met; or (iii) the Company
is or has been a "United States real property holding corporation" for federal
income tax purposes at any time within the shorter of the five-year period
preceding such disposition or such holder's holding period and certain other
conditions are met. The Company has determined that it is not and has never
been, and the Company does not believe that it will become, a "United States
real property holding corporation" for federal income tax purposes. Non-United
States Holders should consult applicable tax treaties, which might result in
United States federal income tax treatment on the sale or other disposition of
Common Stock different than as described above.

BACKUP WITHHOLDING AND INFORMATION REPORTING

Generally, the Company must report to the IRS the amount of dividends paid,
the name and address of the recipient, and the amount, if any, of tax
withheld. A similar report is sent to the holder. Pursuant to tax treaties or
other agreements, the IRS may make its reports available to tax authorities in
the recipient's country of residence.

Unless the Company has actual knowledge that a holder is a Non-United States
Holder, dividends paid to a holder at an address within the United States may
be subject to backup withholding at a rate of 31% if the holder is not an
"exempt recipient" as defined in Treasury Regulations (which includes
corporations) and fails to provide a correct taxpayer identification number
and other information to the Company. Backup withholding will generally not
apply to dividends paid to holders at an address outside the United States
(unless the Company has knowledge that the holder is a United States person).

Proceeds from the disposition of Common Stock by a Non-United States Holder
effected by or through a United States office of a broker will be subject to
information reporting and to backup withholding at a rate of 31% of the gross
proceeds unless such Non-United States Holder certifies under penalties of
perjury as to, among other things, its address and status as a Non-United
States Holder or otherwise establishes an exemption. Generally, United States
information reporting and backup withholding will not apply to a payment of
disposition proceeds if the transaction is effected outside the United States
by or through a non-United States office of a broker. However, if such broker
is, for United States federal income tax purposes, a United States person, a
"controlled foreign corporation," or a foreign person which derives 50% or
more of its gross income for certain

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<PAGE>

periods from the conduct of a United States trade or business, information
reporting (but not backup withholding) will apply unless (i) such broker has
documentary evidence in its files that the holder is a Non-United States
Holder and certain other conditions are met, or (ii) the holder otherwise
establishes an exemption.

The Proposed Regulations would, if adopted, alter the aforegoing rules in
certain respects. Among other things, the Proposed Regulations would provide
certain presumptions and other rules under which Non-United States Holders may
be subject to backup withholding in the absence of required certifications and
would modify the definition of an "exempt recipient" in the case of a
corporation.

Backup withholding is not an additional tax. Rather, the tax liability of
persons subject to backup withholding will be reduced by the amount of tax
withheld. If backup withholding results in an overpayment of United States
income taxes, a refund may be obtained, provided the required documents are
filed with the IRS.

ESTATE TAX

An individual Non-United States Holder who is treated as the owner of Common
Stock at the time of such individual's death or has made certain lifetime
transfers of an interest in Common Stock will be required to include the value
of such Common Stock in such individual's gross estate for United States
federal estate tax purposes and may be subject to United States federal estate
tax, unless an applicable tax treaty provides otherwise. For United States
federal estate tax purposes, a "Non-United States Holder" is an individual who
is neither a citizen nor a domiciliary of the United States. Whether an
individual is considered a "domiciliary" of the United States for estate tax
purposes is generally determined on the basis of all of the facts and
circumstances.

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UNDERWRITERS

Under the terms and subject to conditions contained in an Underwriting
Agreement dated the date hereof, the U.S. Underwriters named below, for whom
Morgan Stanley & Co. Incorporated, William Blair & Company, L.L.C. and
Montgomery Securities are acting as U.S. Representatives, and the
International Underwriters named below, for whom Morgan Stanley & Co.
International Limited, William Blair & Company, L.L.C. and Montgomery
Securities are acting as International Representatives, have severally agreed
to purchase, and the Company has agreed to sell to them, severally, the
respective number of shares of Common Stock set forth opposite the names of
such Underwriters below:

<TABLE>
<CAPTION>
NAME NUMBER OF SHARES
---- ----------------
<S> <C>
U.S. Underwriters:
Morgan Stanley & Co. Incorporated.....................
William Blair & Company, L.L.C........................
Montgomery Securities.................................
---------
Subtotal............................................ 3,200,000
---------
International Underwriters:
Morgan Stanley & Co. International Limited............
William Blair & Company, L.L.C........................
Montgomery Securities.................................
---------
Subtotal............................................ 800,000
---------
Total............................................. 4,000,000
=========
</TABLE>

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<PAGE>

The U.S. Underwriters and the International Underwriters, and the U.S.
Representatives and the International Representatives, are collectively
referred to as the "Underwriters" and the "Representatives," respectively. The
Underwriting Agreement provides that the obligations of the several
Underwriters to pay for and accept delivery of the shares of Common Stock
offered hereby are subject to the approval of certain legal matters by their
counsel and to certain other conditions. The Underwriters are obligated to
take and pay for all of the shares of Common Stock offered hereby (other than
those covered by the U.S. Underwriters' over-allotment option described
below), if any such shares are taken.

Pursuant to the Agreement Between U.S. and International Underwriters, each
U.S. Underwriter has represented and agreed that, with certain exceptions: (i)
it is not purchasing any Shares (as defined herein) for the account of anyone
other than a United States or Canadian Person (as defined herein) and (ii) it
has not offered or sold, and will not offer or sell, directly or indirectly,
any Shares or distribute any prospectus relating to the Shares outside the
United States or Canada or to anyone other than a United States or Canadian
Person. Pursuant to the Agreement Between U.S. and International Underwriters,
each International Underwriter has represented and agreed that, with certain
exceptions: (i) it is not purchasing any Shares for the account of any United
States or Canadian Person and (ii) it has not offered or sold, and will not
offer or sell, directly or indirectly, any Shares or distribute any prospectus
relating to the Shares in the United States or Canada or to any United States
or Canadian Person. With respect to any Underwriter that is a U.S. Underwriter
and an International Underwriter, the foregoing representations and agreements
(i) made by it in its capacity as a U.S. Underwriter apply only to it in its
capacity as a U.S. Underwriter and (ii) made by it in its capacity as an
International Underwriter apply only to it in its capacity as an International
Underwriter. The foregoing limitations do not apply to stabilization
transactions or to certain other transactions specified in the Agreement
Between U.S. and International Underwriters. As used herein, "United States or
Canadian Person" means any national or resident of the United States or
Canada, or any corporation, pension, profit-sharing or other trust or other
entity organized under the laws of the United States or Canada or of any
political subdivision thereof (other than a branch located outside the United
States and Canada of any United States or Canadian Person), and includes any
United States or Canadian branch of a person who is otherwise not a United
States or Canadian Person. All shares of Common Stock to be purchased by the
Underwriters under the Underwriting Agreement are referred to herein as the
"Shares."

Pursuant to the Agreement Between U.S. and International Underwriters, sales
may be made between the U.S. Underwriters and International Underwriters of
any number of Shares as may be mutually agreed. The per share price of any
Shares so sold shall be the public offering price set forth on the cover page
hereof, in United State dollars, less an amount not greater than the per share
amount of the concession to dealers set forth below.

Pursuant to the Agreement Between U.S. and International Underwriters, each
U.S. Underwriter has represented that it has not offered or sold, and has
agreed not to offer or sell, any Shares, directly or indirectly, in any
province or territory of Canada or to, or for the benefit of, any resident of
any province or territory of Canada in contravention of the securities laws
thereof and has represented that any offer or sale of Shares in Canada will be
made only pursuant to an exemption from the requirement to file a prospectus
in the province or territory of Canada in which such offer or sale is made.
Each U.S. Underwriter has further agreed to send to any dealer who purchases
from it any of the Shares a notice stating in substance that, by purchasing
such Shares, such dealer represents and agrees that it has not offered or
sold, and will not offer or sell, directly or indirectly, any of such Shares
in any province or territory of Canada or to, or for the benefit of, any
resident of any province or territory of Canada in contravention of the
securities laws thereof and that any offer or sale of Shares in Canada will be
made only pursuant to an exemption from the requirement to file a prospectus
in the province or territory of Canada in which such offer or sale is made,
and that such dealer will deliver to any other dealer to whom it sells any of
such Shares a notice containing substantially the same statement as is
contained in this sentence.

Pursuant to the Agreement Between U.S. and International Underwriters, each
International Underwriter has represented and agreed that (i) it has not
offered or sold and, prior to the date six months after the closing date for
the sale of the Shares to the International Underwriters, will not offer or
sell, any Shares to persons in the

74
<PAGE>

United Kingdom except to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (as principal or
agent) for the purposes of their businesses or otherwise in circumstances
which have not resulted and will not result in an offer to the public in the
United Kingdom within the meaning of the Public Offers of Securities
Regulations 1995; (ii) it has complied and will comply with all applicable
provisions of the Financial Services Act 1986 with respect to anything done by
it in relation to the Shares in, from or otherwise involving the United
Kingdom; and (iii) it has only issued or passed on and will only issue or pass
on in the United Kingdom any document received by it in connection with the
offering of the Shares to a person who is of a kind described in Article 11(3)
of the Financial Services Act 1986 (Investment Advertisements) (Exemptions)
Order 1996 or is a person to whom such document may otherwise lawfully be
issued or passed on.

Pursuant to the Agreement Between U.S. and International Underwriters, each
International Underwriter has further represented that it has not offered or
sold, and has agreed not to offer or sell, directly or indirectly, in Japan or
to or for the account of any resident thereof, any of the Shares acquired in
connection with the distribution contemplated hereby, except for offers or
sales of Japanese International Underwriters or dealers and except pursuant to
any exemption from the registration requirements of the Securities and
Exchange Law and otherwise in compliance with applicable provisions of
Japanese law. Each International Underwriter has further agreed to send to any
dealer who purchases from it any of the Shares a notice stating in substance
that by purchasing such Shares, such dealer represents and agrees that it has
not offered or sold, and will not offer or sell, any of such Shares, directly
or indirectly, in Japan or to or for the account of any resident thereof
except for offers or sales to Japanese International Underwriters or dealers
and except pursuant to any exemption from the registration requirements of the
Securities and Exchange Law and otherwise in compliance with applicable
provisions of Japanese law, and that such dealer will send to any other dealer
to whom it sells any of such Shares a notice containing substantially the same
statement as is contained in this sentence.

The Underwriters initially propose to offer part of the shares of Common
Stock directly to the public at the public offering price set forth on the
cover page hereof and part to certain dealers at a price that represents a
concession not in excess of $ a share under the public offering price. Any
Underwriter may allow, and such dealers may reallow, a concession not in
excess of $ a share to other Underwriters or to certain dealers. After the
initial offering of the shares of Common Stock, the offering price and other
selling terms may from time to time be varied by the Representatives.

The Selling Stockholder has granted to the U.S. Underwriters an option,
exercisable for 30 days from the date of this Prospectus, to purchase up to an
aggregate of 600,000 additional shares of Common Stock at the public offering
price set forth on the cover page hereof, less underwriting discounts and
commissions. The U.S. Underwriters may exercise such option solely for the
purpose of covering over-allotments, if any, made in connection with the
offering of the shares of Common Stock offered hereby. To the extent such
option is exercised, each U.S. Underwriter will become obligated, subject to
certain conditions, to purchase approximately the same percentage of such
additional shares of Common Stock as the number set forth next to such U.S.
Underwriter's name in the preceding table bears to the total number of shares
of Common Stock set forth next to the names of all U.S. Underwriters in the
preceding table.

The Underwriters have informed the Company that they do not intend sales to
discretionary accounts to exceed five percent of the total number of shares of
Common Stock offered by them.

The Company has applied to have the Common Stock approved for listing on The
New York Stock Exchange under the symbol "LAP."

Each of the Company and the directors, executive officers, the Selling
Stockholder and the other stockholders of the Company have agreed that,
without the prior written consent of Morgan Stanley & Co. Incorporated on
behalf of the Underwriters, it will not, during the period ending 180 days
after the date of this Prospectus, (i) offer, pledge, sell, contract to sell,
sell any option or contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant to purchase, or otherwise transfer or
dispose of, directly or indirectly, any shares of Common Stock or any
securities convertible into or exercisable or exchangeable for

75
<PAGE>

Common Stock, or (ii) enter into any swap or other arrangement that transfers
to another, in whole or in part, any of the economic consequences of ownership
of the Common Stock, whether any such transaction described in clause (i) or
(ii) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. The restrictions described in this paragraph
do not apply to (a) the sale of shares to the Underwriters, (b) the issuance
by the Company of shares of Common Stock upon the exercise of an option or a
warrant or the conversion of a security outstanding on the date of this
Prospectus of which the Underwriters have been advised in writing, (c)
transactions by any person other than the Company relating to shares of Common
Stock or other securities acquired in open market transactions after the
completion of the offering of the Shares, (d) stock or stock option issuances
by the Company pursuant to existing employee benefit plans, or (e) the
distribution of shares of Common Stock by the Employee Partnerships to their
respective partners; provided that any such partners agree to be bound by the
foregoing limitations.

At the request of the Company, the Underwriters have reserved for sale at
the initial offering price, up to 200,000 shares offered hereby for directors,
officers, employees, business associates and related persons of the Company.
The number of shares of Common Stock available for sale to the general public
will be reduced to the extent such persons purchase such reserved shares. Any
reserved shares which are not so purchased will be offered by the Underwriters
to the general public on the same basis as the other shares offered hereby.
All purchasers of the shares of Common Stock reserved pursuant to this
paragraph who are also directors or senior officers of the Company will be
required to enter into agreements identical to those described in the
immediately preceding paragraph restricting the transferability of such shares
for a period of 180 days after the date of this Prospectus.

In order to facilitate the offering of the Common Stock, the Underwriters
may engage in transactions that stabilize, maintain or otherwise affect the
price of the Common Stock. Specifically, the Underwriters may over-allot in
connection with the Offering, creating a short position in the Common Stock
for their own account. In addition, to cover over-allotments or stabilize the
price of the Common Stock, the Underwriters may bid for, and purchase, shares
of Common Stock in the open market. Finally, the underwriting syndicate may
reclaim selling concessions allowed to an underwriter or a dealer for
distributing the Common Stock in the Offering, if the syndicate repurchases
previously distributed Common Stock in transactions to cover syndicate short
positions, in stabilization transactions or otherwise. Any of these activities
may stabilize or maintain the market price of the Common Stock above
independent market levels. The Underwriters are not required to engage in
these activities and may end any of these activities at any time.

The Representatives perform investment banking services to the Company for
which they receive customary compensation. An affiliate of Morgan Stanley &
Co. Incorporated has retained the Company for investment advisory services on
behalf of one of its clients. Such client pays customary fees to the Company
for such services. Thomas C. Theobald, a director nominee of the Company, is
an employee of William Blair & Company, L.L.C.

The Company and the Underwriters have agreed to indemnify each other against
certain liabilities, including liabilities under the Securities Act. The
Selling Stockholder has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act.

PRICING OF THE OFFERING

Prior to the Offering, there has been no public market for the Common Stock.
The initial public offering price will be determined by negotiations between
the Company and the U.S. Representatives. Among the factors to be considered
in determining the initial public offering price will be the future prospects
of the Company and its industry in general, sales, earnings and certain other
financial and operating information of the Company in recent periods, and the
price-earnings ratios, price-sales ratios, aggregate value-EBITDA ratios,
market prices of securities and certain financial and operating information of
companies engaged in activities similar to those of the Company. The estimated
initial public offering price range set forth on the cover page of this
Preliminary Prospectus is subject to change as a result of market conditions
and other factors.

76
<PAGE>

LEGAL MATTERS

The validity of the shares of Common Stock offered hereby will be passed
upon for the Company by Skadden, Arps, Slate, Meagher & Flom (Illinois) and
for the Underwriters by Sidley & Austin, Chicago, Illinois. Skadden, Arps,
Slate, Meagher & Flom (Illinois) and Sidley & Austin will rely upon the
opinion of Piper & Marbury L.L.P., Baltimore, Maryland, as to certain matters
of Maryland law.

EXPERTS

The Combined Financial Statements of the Predecessor Partnerships as of
December 31, 1995 and 1996, and for each of the years in the three-year period
ended December 31, 1996 and the balance sheet of LaSalle Partners Incorporated
as of April 22, 1997 included in this Prospectus and Registration Statement
have been included herein and in the Registration Statement in reliance upon
the reports of KPMG Peat Marwick LLP, independent certified public
accountants, and upon the authority of said firm as experts in accounting and
auditing.

The Combined Financial Statements of Galbreath as of December 31, 1996 and
for the year then ended included in this Prospectus have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their report
appearing herein, and are included in reliance upon the report of such firm
given upon their authority as experts in accounting and auditing.

ADDITIONAL INFORMATION

The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement (the "Registration Statement") under
the Securities Act of 1933, as amended, with respect to the Common Stock
offered hereby. This Prospectus, which constitutes a part of the Registration
Statement, does not contain all of the information set forth in the
Registration Statement, and the exhibits and schedules to the Registration
Statement. Statements made in this Prospectus as to the contents of any
agreement or other document referred to herein are not necessarily complete,
and reference is made to the copy of such agreement or other document filed as
an exhibit or schedule to the Registration Statement, and each such statement
shall be deemed qualified in its entirety by such reference. For further
information, reference is made to the Registration Statement and to the
exhibits and schedules filed therewith.

After consummation of the Offering, the Company will be subject to the
information and reporting requirements of the Exchange Act and, in accordance
therewith will be required to file proxy statements, reports and other
information with the Commission. The Registration Statement, as well as any
such report, proxy statement and other information filed by the Company with
the Commission, may be inspected and copied at the public reference facilities
maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549, and at the regional offices of the Commission
located at 7 World Trade Center, 13th Floor, New York, New York 10048 and the
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
Copies of such material can be obtained from the Public Reference Section of
the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed
rates. The Commission maintains a web site (http://www.sec.gov) that contains
reports, proxy and information statements and other information regarding
registrants that file electronically with the Commission. Upon listing of the
Common Stock on the New York Stock Exchange, Inc. (the "NYSE"), reports, proxy
statements and other information concerning the Company may be inspected at
the offices of the NYSE, 20 Broad Street, New York, New York 10005.

The Company intends to furnish to its stockholders annual reports containing
consolidated financial statements audited by an independent public accounting
firm accompanied by an opinion expressed by such independent public accounting
firm and quarterly reports for the first three quarters of each fiscal year
containing unaudited consolidated financial information in each case prepared
in accordance with GAAP.

77
<PAGE>

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
LaSalle Partners Limited Partnership and LaSalle Partners Management
Limited Partnership
Report of KPMG Peat Marwick LLP, Independent Auditors................... F-2
Combined Balance Sheets as of December 31, 1995 and 1996, and
(unaudited) as of March 31, 1997....................................... F-3
Combined Statements of Earnings For the Years Ended December 31, 1994,
1995 and 1996, and (unaudited) for the Three Months Ended March 31,
1996 and 1997.......................................................... F-4
Combined Statements of Partners' Capital (Deficit) For the Years Ended
December 31, 1994, 1995 and 1996, and (unaudited) for the Three Months
Ended March 31, 1997................................................... F-5
Combined Statements of Cash Flows For the Years Ended December 31, 1994,
1995 and 1996, and (unaudited) for the Three Months Ended March 31,
1996 and 1997.......................................................... F-6
Notes to Combined Financial Statements.................................. F-7
LaSalle Partners Incorporated
Report of KPMG Peat Marwick LLP, Independent Auditors................... F-17
Balance Sheet as of April 22, 1997...................................... F-18
Notes to Balance Sheet.................................................. F-19
The Galbreath Company and Affiliates
Report of Deloitte & Touche LLP, Independent Auditors................... F-20
Combined Balance Sheets as of December 31, 1996, and (unaudited) as of
March 31, 1997......................................................... F-21
Combined Statements of Income and Owner's Equity for the Year Ended
December 31, 1996, and (unaudited) for the Three Months Ended March 31,
1996 and 1997.......................................................... F-22
Combined Statements of Cash Flows for the Year Ended December 31, 1996,
and (unaudited) for the Three Months Ended March 31, 1996 and 1997..... F-23
Notes to Combined Financial Statements.................................. F-24
</TABLE>

F-1
<PAGE>

INDEPENDENT AUDITORS' REPORT

The Partners
LaSalle Partners Limited Partnership
LaSalle Partners Management Limited Partnership:

We have audited the accompanying combined balance sheets of LaSalle Partners
Limited Partnership and subsidiaries and LaSalle Partners Management Limited
Partnership and subsidiaries as of December 31, 1995 and 1996, and the related
combined statements of earnings, partners' capital (deficit), and cash flows
for each of the years in the three-year period ended December 31, 1996. These
combined financial statements are the responsibility of the general partners
of the Partnerships. Our responsibility is to express an opinion on these
combined financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the combined financial statements referred to above present
fairly, in all material respects, the financial position of LaSalle Partners
Limited Partnership and subsidiaries and LaSalle Partners Management Limited
Partnership and subsidiaries as of December 31, 1995 and 1996, and the results
of their operations and their cash flows for each of the years in the three-
year period ended December 31, 1996, in conformity with generally accepted
accounting principles.

KPMG Peat Marwick LLP

Chicago, Illinois
March 21, 1997
except as to note 12
which is as of April 22, 1997

F-2
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP
AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP
AND SUBSIDIARIES

COMBINED BALANCE SHEETS
(IN THOUSANDS)

<TABLE>
<CAPTION>
DECEMBER 31,
------------------ MARCH 31,
ASSETS 1995 1996 1997
------ -------- -------- -----------
(UNAUDITED)
<S> <C> <C> <C>
Current assets:
Cash and cash equivalents..................... $ 8,322 $ 7,207 $ 8,094
Trade receivables, net of allowances.......... 71,677 87,283 52,052
Other receivables............................. 2,035 3,005 4,116
Prepaid expenses.............................. 1,016 1,228 1,115
-------- -------- --------
Total current assets........................ 83,050 98,723 65,377
Property and equipment, at cost, less
accumulated depreciation of $22,900, $23,310
and $24,295 in 1995, 1996 and 1997,
respectively (note 2).......................... 10,132 14,549 14,409
Intangibles resulting from business acquisitions
(note 3)....................................... 8,351 23,735 22,647
Investments in real estate ventures (note 6).... 7,386 13,687 15,752
Long-term receivables, net of allowances........ 5,296 5,052 4,878
Other assets, net............................... 786 868 1,012
-------- -------- --------
$115,001 $156,614 $124,075
======== ======== ========
<CAPTION>
LIABILITIES AND PARTNERS' CAPITAL
---------------------------------
<S> <C> <C> <C>
Current liabilities:
Accounts payable and accrued liabilities...... $ 31,160 $ 34,228 $ 19,059
Accrued compensation (note 9)................. 24,872 26,016 6,143
Borrowings under short-term credit facility
(note 7)..................................... -- 6,500 16,800
Current maturities of long-term debt (note 7). 1,308 9,064 9,332
-------- -------- --------
Total current liabilities................... 57,340 75,808 51,334
Long-term debt (note 7):
Subordinated loans, less current maturities... 37,213 34,106 34,106
Long-term credit facility, less current
maturities................................... 3,592 21,445 22,977
-------- -------- --------
Total long-term debt........................ 40,805 55,551 57,083
Other long-term liabilities..................... 1,859 1,008 1,008
Commitments and contingencies (notes 4, 6, 8 and
11)
-------- -------- --------
Total liabilities........................... 100,004 132,367 109,425
Partners' capital:
General partners.............................. (49,627) (45,097) (50,161)
Limited partners.............................. 64,624 68,245 64,195
Effect of cumulative translation adjustments . -- 1,099 616
-------- -------- --------
Total partners' capital..................... 14,997 24,247 14,650
-------- -------- --------
$115,001 $156,614 $124,075
======== ======== ========
</TABLE>

See accompanying notes to combined financial statements.

F-3
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP
AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP
AND SUBSIDIARIES

COMBINED STATEMENTS OF EARNINGS
(IN THOUSANDS)

<TABLE>
<CAPTION>
THREE MONTHS
YEARS ENDED DECEMBER 31, ENDED MARCH 31,
-------------------------- ----------------
1994 1995 1996 1996 1997
-------- -------- -------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Revenue:
Fee based services (note 5)..... $123,243 $146,282 $170,709 $26,734 $34,244
Equity in earnings from
unconsolidated ventures (note
6)............................. 1,024 3,130 3,220 89 1,394
Construction operations, net
(note 4)....................... 1,284 1,358 1,271 311 205
Other income.................... 1,367 1,057 767 151 176
-------- -------- -------- ------- -------
Total revenue................. 126,918 151,827 175,967 27,285 36,019
Operating expenses:
Compensation and benefits (note
9)............................. 78,108 91,183 104,673 23,327 27,217
Other operating and
administrative................. 27,944 36,288 38,977 8,052 10,300
Depreciation and amortization
(note 2)....................... 2,851 4,240 5,416 1,111 1,774
-------- -------- -------- ------- -------
Total operating expenses...... 108,903 131,711 149,066 32,490 39,291
-------- -------- -------- ------- -------
Operating income (loss)......... 18,015 20,116 26,901 (5,205) (3,272)
Interest expense (note 7)......... 5,159 3,806 5,730 937 1,695
-------- -------- -------- ------- -------
Earnings (loss) before provision
for income taxes............... 12,856 16,310 21,171 (6,142) (4,967)
Net provision (benefit) for income
taxes (note 2)................... 554 505 1,207 (350) (248)
-------- -------- -------- ------- -------
Net earnings (loss)............... $ 12,302 $ 15,805 $ 19,964 $(5,792) $(4,719)
======== ======== ======== ======= =======
Net earnings (loss) attributable
to:
General partners................ $ 8,400 $ 8,782 $ 11,093 $(3,219) $(2,622)
Limited partners................ 3,902 7,023 8,871 (2,573) (2,097)
-------- -------- -------- ------- -------
Net earnings (loss)............... $ 12,302 $ 15,805 $ 19,964 $(5,792) $(4,719)
======== ======== ======== ======= =======
</TABLE>

See accompanying notes to combined financial statements.

F-4
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP
AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP
AND SUBSIDIARIES

COMBINED STATEMENTS OF PARTNERS' CAPITAL (DEFICIT)
(IN THOUSANDS)

<TABLE>
<CAPTION>
GENERAL LIMITED
PARTNERS PARTNERS OTHER TOTAL
-------- -------- ----- --------
<S> <C> <C> <C> <C>
Partners' capital (deficit), January 1,
1994...................................... $(50,356) 35,067 -- $(15,289)
Net earnings............................. 8,400 3,902 -- 12,302
Distributions............................ (7,614) (3,348) -- (10,962)
Assets, net of liabilities contributed by
limited partners........................ -- 13,000 -- 13,000
Limited partners' cash contributions..... -- 14,106 -- 14,106
-------- ------ ----- --------
Total contributions.................... -- 27,106 -- 27,106
-------- ------ ----- --------
Partners' capital (deficit), December 31,
1994...................................... (49,570) 62,727 -- 13,157
Net earnings............................. 8,782 7,023 -- 15,805
Distributions............................ (8,839) (5,126) -- (13,965)
-------- ------ ----- --------
Partners' capital (deficit), December 31,
1995...................................... (49,627) 64,624 -- 14,997
Net earnings............................. 11,093 8,871 -- 19,964
Distributions............................ (6,563) (5,250) -- (11,813)
Effect of cumulative translation
adjustments............................. -- -- 1,099 1,099
-------- ------ ----- --------
Partners' capital (deficit), December 31,
1996...................................... $(45,097) 68,245 1,099 $ 24,247
Net earnings (loss) (unaudited).......... (2,622) (2,097) -- (4,719)
Distributions (unaudited)................ (2,442) (1,953) -- (4,395)
Effect of cumulative translation
adjustments (unaudited)................. -- -- (483) (483)
-------- ------ ----- --------
Partners' capital (deficit), March 31, 1997
(unaudited)............................... $(50,161) 64,195 616 $ 14,650
======== ====== ===== ========
</TABLE>

See accompanying notes to combined financial statements.

F-5
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP
AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP
AND SUBSIDIARIES

COMBINED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
THREE MONTHS
YEARS ENDED DECEMBER 31, ENDED MARCH 31,
---------------------------- ------------------
1994 1995 1996 1996 1997
-------- -------- -------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Cash flows from operating
activities:
Net earnings (loss)......... $ 12,302 $ 15,805 $ 19,964 $ (5,792) $ (4,719)
Reconciliation of net
earnings (loss) to net
cash provided by operating
activities:
Depreciation and
amortization............. 2,851 4,240 5,416 1,111 1,774
Equity in earnings and
gain on sale from
unconsolidated ventures
(note 6)................. (1,349) (3,130) (3,220) (89) (1,394)
Provision for loss on
receivables and other
assets................... 247 2,732 986 3 1,140
Operating distributions
from unconsolidated
ventures................. 398 1,078 3,571 629 386
Changes in:
Receivables............... 2,634 (9,699) (17,234) 22,477 33,123
Prepaid expenses and other
assets................... (312) 172 37 90 15
Accounts payable, accrued
liabilities and accrued
compensation............. 7,857 2,355 4,444 (31,150) (35,003)
-------- -------- -------- -------- --------
Net cash provided by
(used in) operating
activities............. 24,628 13,553 13,964 (12,721) (4,678)
Cash flows provided by (used
in) investing activities:
Net capital additions--
property and equipment..... (2,218) (5,055) (10,790) (5,113) (981)
Acquisition of CIN (note
3)......................... -- -- (15,700) -- --
Investments in real estate
ventures:
Capital contributions and
advances to real estate
ventures................. (9,435) (1,941) (9,270) (1,065) (2,206)
Distributions, repayments
of advances and sale of
investments.............. 6,768 1,290 3,282 211 1,149
-------- -------- -------- -------- --------
Net cash used in
investing activities .. (4,885) (5,706) (32,478) (5,967) (2,038)
Cash flows provided by (used
in) financing activities:
Net borrowings under credit
facility................... (2,000) 1,600 29,002 18,000 12,100
Payment of subordinated
notes payable.............. (14,106) -- -- -- --
Distributions to partners... (10,962) (13,965) (11,813) (3,079) (4,395)
Contributions from
partners................... 15,040 -- -- -- --
-------- -------- -------- -------- --------
Net cash provided by
(used in) financing
activities............. (12,028) (12,365) 17,189 14,921 7,705
Effects of foreign currency
translation on cash
balances................... -- -- 210 -- (102)
-------- -------- -------- -------- --------
Net increase (decrease) in
cash and cash equivalents.. 7,715 (4,518) (1,115) (3,767) 887
Cash and cash equivalents,
January 1.................. 5,125 12,840 8,322 8,322 7,207
-------- -------- -------- -------- --------
Cash and cash equivalents,
December 31................ $ 12,840 $ 8,322 $ 7,207 $ 4,555 $ 8,094
======== ======== ======== ======== ========
</TABLE>

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION (UNAUDITED WITH RESPECT TO
INFORMATION FOR THE THREE MONTHS ENDED MARCH 31, 1996 AND 1997):

Combined interest paid was $5,217, $3,798 and $5,191 for the years ended
December 31, 1994, 1995 and 1996, respectively, and $12 and $773 for the three
months ended March 31, 1996 and 1997, respectively.

See accompanying notes to combined financial statements.

F-6
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO COMBINED FINANCIAL STATEMENTS
(IN THOUSANDS)

(UNAUDITED AS TO INTERIM PERIODS)

(1) ORGANIZATION

LaSalle Partners Limited Partnership ("LPL") and LaSalle Partners Management
Limited Partnership ("LPML"), two Delaware limited partnerships (collectively,
the "Partnerships"), were formed on June 29, 1988 to provide real estate
services to clients including leasing, brokerage, construction and development
management, real property asset management and real estate investment advice.
Prior to June 29, 1988, these real estate services were provided by the
general partners of the Partnerships, DEL-LPL Limited Partnership and DEL-
LPAML Limited Partnership (collectively "DEL"), respectively. Previous to
January 23, 1995, LPML transacted business under the name of LaSalle Partners
Asset Management Limited.

Prior to November 30, 1994, the sole limited partners of LPL and LPML were
DSA-LSPL, Inc. and DSA-LSAM, Inc. (collectively "DSA"), respectively. On that
date, the Partnerships admitted Alex. Brown Kleinwort Benson Realty Advisors
Corporation ("ABKB") as an additional limited partner (note 3). Effective
March 31, 1995, ABKB changed its name to KB-LPL, Inc. DEL, DSA and KB-LPL,
Inc. had ownership interests of 55.6%, 24.4% and 20.0%, respectively, at
December 31, 1995 and 1996.

In August 1995, Dresdner Bank AG ("Dresdner") purchased the parent company
of KB-LPL, Inc. As a result of bank regulatory requirements, Dresdner was
required to sell its interests in the Partnerships. Pursuant to an agreement
reached with Dresdner in May, 1996, DEL re-purchased KB-LPL, Inc.'s ownership
in the Partnerships during the first quarter of 1997.

Under the provisions of the partnership agreements, LPL and LPML partnership
interests are paired on a one-for-one basis and may only be purchased or sold
in tandem. Partnership interests in DEL are also paired on a one-for-one
basis. Further, the partnership agreements provide for changes in ownership
interests. DEL has the right to increase their ownership interest by making
additional capital contributions to the Partnerships. Such additional capital
would be used by the Partnerships to repay subordinated notes payable,
including Class A and Class B notes, to DSA (note 7). If DEL does not exercise
their right, DSA has the right to convert any unpaid principal on the
subordinated notes into an additional capital contribution thus increasing
their ownership interests (note 7). Provisions in the partnership agreements
provide for the repayment of the Class A notes payable to DSA to be made
directly by the Partnerships.

The Partnerships' net cash flow, after appropriate reserves, is generally
distributed to the partners in accordance with their ownership interests. The
partnership agreements permit distributions during each year to the partners
in connection with estimated federal income tax payments owed by the partners.
Net profits and losses of the Partnerships are generally allocated to the
partners in accordance with their ownership interests in effect during each
year.

The Partnerships expect to be subject to a reorganization as part of the
Incorporation Transactions of LaSalle Partners Incorporated ("LPI"). Due to
the existence of a paired share arrangement between LPL and LPML and between
the DEL partnerships, as well as the existence of identical ownership before
and after the Incorporation Transactions, such transactions are expected to be
accounted for in a manner similar to the accounting used for a pooling of
interests. Thus, LPI's financial statements will include the financial
position and results of operations of the Partnerships at their historical
cost basis.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Combination and Consolidation

Due to the existence of a paired share arrangement between LPL and LPML, the
financial position and results of operations of the Partnerships have been
presented on a combined basis. The combined financial

F-7
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO COMBINED FINANCIAL STATEMENTS--(CONTINUED)

statements include the accounts of the Partnerships and their majority owned
and controlled partnerships and subsidiaries. All material intercompany
transactions between the Partnerships and their subsidiaries have been
eliminated in consolidation and combination.

Use of Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Cash Held for Others

The Partnerships control certain cash and cash equivalents as agents for
their investment and property management clients. Such amounts, which total
$198,821 and $338,504 at December 31, 1995 and 1996, respectively, are not
included in the accompanying Combined Balance Sheets.

Statement of Cash Flows

Cash and cash equivalents include demand deposits and investments in U.S.
Treasury instruments (generally held available for sale) with maturities of
three months or less. The combined carrying value of such investments of
$5,979 and $1,000 approximates their market value at December 31, 1995 and
1996, respectively.

Impairment of Long-Lived Assets

The Partnerships adopted the provisions of Statement of Financial Accounting
Standards (SFAS) No. 121 Accounting for the Impairment of Long-lived Assets
and Long-lived Assets to be Disposed of on January 1, 1996. This statement
requires that long-lived assets and certain identifiable intangibles are to be
reviewed for impairment whenever events or change in circumstances indicate
that the carrying amount of an asset may not be recoverable. Recoverability of
assets to be held and used is measured by a comparison of the carrying amount
of an asset to future net cash flows expected to be generated by the asset. If
such assets are considered to be impaired, the impairment to be recognized is
measured by the amount by which the carrying value of the assets exceed the
fair value of the assets. Assets to be disposed of are reported at the lower
of the carrying amount or fair value less costs to sell. Adoption of SFAS No.
121 did not have a material impact on the Partnerships' financial position,
results of operations, or liquidity.

Investments in Real Estate Ventures

The Partnerships have limited and general partner interests in various real
estate ventures with interests ranging from less than 1% to 49.5% which are
accounted for using the equity method (note 6).

The Partnerships also have nominal limited and general partner interests in
certain real estate ventures for which no significant capital will be
contributed. These investments, which represent ownership interests of up to
2%, are accounted for under the cost method.

Intangibles Resulting from Business Acquisitions

The Partnerships periodically evaluate the recoverability of the carrying
amount of intangibles resulting from business acquisitions by assessing
whether any impairment indications are present, including substantial

F-8
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO COMBINED FINANCIAL STATEMENTS--(CONTINUED)

recurring operating deficits or significant adverse changes in legal or
economic factors that affect the businesses acquired. If such analysis
indicates impairment, the intangible asset would be adjusted in the period
such changes occurred based on its estimated fair value, which is derived from
expected cash flow of the businesses.

Fair Value of Financial Instruments

The Partnerships' financial instruments include cash and cash equivalents,
receivables, accounts payable and notes payable. The estimated fair value of
cash and cash equivalents, receivables and payables approximate their carrying
amounts due to the short maturity of these instruments. The estimated fair
value of the Partnership's credit facilities approximates their carrying value
due to their variable interest rate terms. The estimated fair value of the
Partnership's subordinated loans approximates their carrying value due to the
anticipated retirement of the loans at their carrying value in connection with
LPI's initial public offering.

Foreign Currency Translation

The financial statements of subsidiaries outside the United States, except
those subsidiaries located in highly inflationary economies, are generally
measured using the local currency as the functional currency. The assets and
liabilities of these subsidiaries are translated at the rates of exchange at
the balance sheet date. The resultant translation adjustments are included as
a separate component of partners' capital. Income and expense are translated
at average monthly rates of exchange. Gains and losses from foreign currency
transactions of these subsidiaries are included in net earnings. For
subsidiaries operating in highly inflationary economies, gains and losses from
balance sheet translation adjustments are included in net earnings.

Revenue Recognition

Advisory and management fees are recognized in the period in which the
services are performed. Transaction commissions are recorded as income at the
time the related services are provided unless significant future contingencies
exist. Construction and Development Management fees are generally recognized
as billed, which approximates the percentage of completion method of
accounting. Fees recognized in the current period that are expected to be
received beyond one year have been discounted to the present value of future
payments.

Depreciation

Depreciation and amortization is calculated for financial reporting purposes
using the straight-line method based on the estimated useful lives of the
assets. Furniture totaling $12,109 and $14,400 at December 31, 1995 and 1996,
respectively, is depreciated over seven years. Computer equipment and software
totaling $12,023 and $13,862 at December 31, 1995 and 1996, respectively, are
depreciated over three years. Leasehold improvements totaling $8,900 and
$9,597 at December 31, 1995 and 1996, respectively, are amortized over the
lease periods ranging from one to 10 years.

Income Tax Provision

Included in the accompanying Combined Statements of Earnings is a federal
and state income tax provision for wholly-owned corporate subsidiaries and a
state tax provision for certain states which require partnerships to pay
income taxes. No other provision for income taxes has been made as any
liability for such taxes would be that of the respective partners.

F-9
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO COMBINED FINANCIAL STATEMENTS--(CONTINUED)

Interim Information

The combined financial statements as of March 31, 1997 and for the three
months ended March 31, 1997 and 1996 are unaudited; however, in the opinion of
management, all adjustments (consisting solely of normal recurring
adjustments) necessary for a fair presentation of the combined financial
statements for these interim periods have been included. The results for the
interim period ended March 31, 1997 are not necessarily indicative of the
results to be obtained for the full fiscal year.

Reclassifications

Certain 1994 and 1995 amounts have been reclassified to conform to the 1996
presentation.

(3) ACQUISITIONS

On October 17, 1996, subsidiaries of the Partnerships acquired all of the
common stock of CIN Property Management Limited, a London, England investment
and property management private limited liability company, for $15,709
including transaction expenses. The name of the entity was immediately changed
to CIN LaSalle Advisors Capital Management Limited ("CIN"). The acquisition
was accounted for as a purchase and accordingly, operating results of this
business subsequent to the date of acquisition are included in the
accompanying Combined Statements of Earnings. The excess purchase price over
the fair value of the identifiable assets and liabilities acquired was
$15,700, of which $4,710 was allocated to advisory contracts which are being
amortized on a straight-line basis over 5 years and $10,990 was allocated to
goodwill which is being amortized on a straight-line basis over a period of 20
years based on the Partnerships' estimate of useful lives. The effect of the
year end translation adjustment (note 2) increased the recorded amount of
goodwill by $960. Intangibles resulting from business acquisitions in the
accompanying Combined Balance Sheets includes $16,320 at December 31, 1996
related to the CIN acquisition.

On November 30, 1994, ABKB contributed all of its net assets valued at
$13,000 (including cash of $934) to the Partnerships. This transaction, in
combination with ABKB's purchase of partnership units from an affiliate of
DEL, resulted in ABKB acquiring a 20% limited partner interest (note 1). The
asset contribution transaction was accounted for using the purchase method of
accounting. Accordingly, the Partnerships allocated the purchase price to the
identifiable assets and liabilities acquired based on their estimated fair
values with the excess being allocated to advisory contracts. The excess value
of $9,361 is being amortized on a straight-line basis over a period of 10
years. Intangibles resulting from business acquisitions in the accompanying
Combined Balance Sheets include $8,351 and $7,415 at December 31, 1995 and
1996, respectively, related to the ABKB acquisition. The results of the
acquired business subsequent to November 30, 1994 have been included in the
accompanying Combined Statements of Earnings.

The pro forma results of such acquisitions are not material to the
Partnerships' combined financial statements.

(4) DISPOSITIONS

Effective December 31, 1996, the Partnerships sold its construction
management business and certain related assets to a former member of
management for a $9.1 million note. The note, which is secured by the current
and future assets of the business, is due December 31, 2006 and bears interest
at rates of 6.8% to 10%, with interest payments due annually. Principal
payments are also due annually beginning January 1998 as defined.

F-10
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO COMBINED FINANCIAL STATEMENTS--(CONTINUED)

Under the terms of the Asset Purchase Agreement, the Partnerships have
agreed to provide certain administrative and financial services, at cost,
beginning January 1997 and may provide certain financial assistance if
necessary.

For financial reporting purposes, the Partnerships have not treated the
transaction as a divestiture. As such, the net assets sold as part of the
transaction aggregating $68 at December 31, 1996 have been included in other
assets in the accompanying Combined Balance Sheets. The results of operations
of the construction management business will be accounted for similar to the
equity method of accounting. As such, principal and interest to be received
under the note will be treated as a reduction of such net assets and as a
reserve, if necessary, for any anticipated financial exposure under the terms
of the Asset Purchase Agreement with the remainder recognized as income.

The revenue related to the construction business sold for the years ended
December 31, 1994, 1995 and 1996 totaled $4,858, $4,977 and $5,678,
respectively. For financial statement presentation purposes these revenues
have been presented net of related expenses totaling $3,574, $3,619 and
$4,407, respectively, in the accompanying Combined Statements of Earnings.

The Partnerships pay subcontractors for expenses incurred on behalf of
construction management clients for which they are reimbursed monthly.
Included in trade receivables in the accompanying Combined Balance Sheets are
amounts due from clients totaling $15,281 and $21,757, respectively, related
to construction fee and reimbursable receivables at December 31, 1995 and
1996, respectively. Corresponding liabilities related to amounts payable to
subcontractors are included in accounts payable and accrued liabilities in the
accompanying Combined Balance Sheets totaling $17,926 and $20,109 at December
31, 1995 and 1996, respectively. In accordance with the Asset Purchase
Agreement, any trade receivables, net of related payables to subcontractors,
which are uncollected at April 30, 1997 will be reimbursed to the Partnerships
by the purchaser.

(5) BUSINESS SEGMENTS

The Partnerships' operations have been classified into three business
segments: Management Services, Corporate and Financial Services and Investment
Management. The Management Services segment provides three primary service
capabilities: (i) property management and leasing for property owners, (ii)
facility management for properties occupied by corporate owners and users; and
(iii) development management for both investors and real estate users seeking
to develop new buildings or renovate existing facilities. The Corporate and
Financial Services segment provides transaction and advisory services through
three primary service capabilities, including: (i) tenant representation for
corporations and professional services firms; (ii) investment banking services
to address the financing, acquisition and disposition needs of real estate
owners; and (iii) land acquisition and development services for owners, users
and developers of land. The Investment Management segment provides real estate
investment management services to institutional investors, corporations and
high net worth individuals.

Total revenue by industry segment includes revenue derived from services
provided to other segments. Operating income represent total revenue less
direct and indirect allocable expenses. The Partnerships allocate all
expenses, other than interest and income taxes, as substantially all expenses
incurred benefit one or more of the segments. Identifiable assets by segment
are those assets that are used by or are a result of each segments' business.
Corporate assets are principally cash and cash equivalents, office furniture
and leasehold improvements.

F-11
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO COMBINED FINANCIAL STATEMENTS--(CONTINUED)

Summarized financial information by business segment for 1994, 1995 and 1996
is as follows:

<TABLE>
<CAPTION>
1994 1995 1996
------- ------- -------
<S> <C> <C> <C>
MANAGEMENT SERVICES:
Revenue................................................ $52,457 $61,782 $71,669
Intersegment revenue................................... 160 1,370 200
------- ------- -------
Total Revenue...................................... $52,617 $63,152 $71,869
======= ======= =======
Operating income....................................... $ 5,274 $11,091 $10,732
======= ======= =======
Depreciation and amortization.......................... $ 1,076 $ 1,202 $ 1,651
Identifiable assets.................................... 21,193 20,154
CORPORATE AND FINANCIAL SERVICES:
Revenue................................................ $35,084 $37,303 $45,706
Intersegment revenue................................... -- -- 1,000
------- ------- -------
Total Revenue...................................... $35,084 $37,303 $46,706
======= ======= =======
Operating income....................................... $ 6,776 $ 7,809 $10,820
======= ======= =======
Depreciation and amortization.......................... $ 845 $ 890 $ 1,055
Identifiable assets.................................... 37,977 46,292
INVESTMENT MANAGEMENT:
Revenue................................................ $39,377 $52,742 $58,592
Intersegment revenue................................... -- -- --
------- ------- -------
Total Revenue...................................... $39,377 $52,742 $58,592
======= ======= =======
Operating income....................................... $ 5,965 $ 1,216 $ 5,349
======= ======= =======
Depreciation and amortization.......................... $ 930 $ 2,148 $ 2,710
Identifiable assets.................................... 26,898 53,337
</TABLE>

The Partnerships maintain operations and provide services outside of the
United States. International revenue aggregated $4,311, $5,164 and $7,676 in
1994, 1995 and 1996, respectively. Identifiable assets of such operations
aggregated $5,827 and $26,702 at December 31, 1995 and 1996, respectively.

(6) INVESTMENTS IN REAL ESTATE VENTURES

The Partnerships have invested in certain real estate ventures which own and
operate commercial real estate. These investments include noncontrolling
general and limited partnership ownership interests ranging from less than 1%
to 49.5% of the respective ventures. The Partnerships have made initial
capital contributions to the ventures. The Partnerships have remaining
commitments to certain ventures for additional capital contributions of
approximately $2,300 as of December 31, 1996. Substantially all venture
interests are held by corporate subsidiaries of the Partnerships. Accordingly,
the Partnerships' exposure to liabilities and losses of the ventures is
limited to its initial and remaining commitments.

Such investments have been accounted for under the equity method of
accounting in the accompanying combined financial statements. As such, the
Partnerships recognize their share of the underlying profits and losses

F-12
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO COMBINED FINANCIAL STATEMENTS--(CONTINUED)

of the ventures as revenue in the accompanying Combined Statements of
Earnings. The Partnerships generally are entitled to operating distributions
in accordance with their respective ownership interests.

Summarized combined financial information for the unconsolidated ventures is
presented below:

<TABLE>
<CAPTION>
1994 1995 1996
-------- -------- ----------
<S> <C> <C> <C>
Balance Sheet:
Investments in real estate....................... $759,714 $1,043,074
Total assets..................................... $871,335 $1,167,413
======== ==========
Mortgage indebtedness............................ 376,151 67,971
Total liabilities................................ $439,309 $ 617,635
======== ==========
Total equity..................................... $432,026 $ 549,778
======== ==========
Investments in unconsolidated ventures............. $ 6,302 $ 12,562
======== ==========
Statements of Operations:
Revenues......................................... $119,664 $187,720 $ 212,048
Net earnings..................................... $ 13,235 $ 31,783 $ 35,333
======== ======== ==========
Equity in earnings from unconsolidated ventures.... $ 1,024 $ 3,130 $ 3,220
======== ======== ==========
</TABLE>

The Partnerships also have investments which are accounted for using the
cost method which totaled $1,084 and $1,125 at December 31, 1995 and 1996,
respectively (note 2). Certain of the Partnerships' capital contributions to
the ventures are represented by notes payable which totaled $515 and $1,008 at
December 31, 1995 and 1996, respectively. Such notes are generally interest
bearing and mature in 2000.

(7) DEBT

Credit Facilities

In September 1996, the Partnerships replaced their $30 million revolving
line of credit ($4,900 outstanding at December 31, 1995), due annually on
April 30, with a $70 million credit agreement, terminating on September 6,
1999. The agreement consists of a short-term and long-term facility totaling
$30 million and $40 million, respectively. The credit agreement is secured by
certain of the Partnerships' receivables, fixed assets and investments in
ventures. The Partnerships must maintain a certain level of combined net
worth, earnings before interest, taxes, depreciation and amortization, and are
prohibited, without the lenders' prior approval, from incurring certain
indebtedness (including certain levels of indebtedness in connection with co-
investments), guaranteeing certain obligations, or disposing of a significant
portion of their assets. The facilities bear variable rates of interest based
on market rates.

The short-term facility is a revolving line of credit which must be paid
down annually for a 30 consecutive day period and is restricted as to use for
general business purposes. Amounts outstanding on the short-term facility at
December 31, 1996 aggregated $6,500.

The long-term facility is limited in use to fund investments in real estate
ventures, business acquisitions and certain capital expenditures, subject to
lender approval. Principal payments on borrowings under the long-term facility
are payable annually on June 15 for amounts outstanding as of March 31 based
on a defined amortization schedule. Principal payments made on June 15 of each
year increase the available balance on the facility from which to borrow.
Amounts outstanding on the long-term facility at December 31, 1996 aggregated
$27,402.

F-13
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO COMBINED FINANCIAL STATEMENTS--(CONTINUED)

Subordinated Loans

Subordinated loans consist of Class A and Class B unsecured notes payable to
DSA. The amounts outstanding on the Class A and Class B notes were $37,213 at
December 31, 1995 and 1996. Interest is payable annually on December 31 at a
rate of 10%.

Aggregate principal payments related to long-term debt due in each of the
next five years ending December 31 are as follows:

<TABLE>
<CAPTION>
CREDIT
FACILITY SUBORDINATED TOTAL
-------- ------------ -------
<S> <C> <C> <C>
1997........................................ $ 5,957 $ 3,107 $ 9,064
1998........................................ 5,617 3,106 8,723
1999........................................ 5,192 3,100 8,292
2000........................................ 5,107 3,100 8,207
2001........................................ 3,843 3,100 6,943
Thereafter.................................. 1,686 21,700 23,386
------- ------- -------
$27,402 $37,213 $64,615
======= ======= =======
</TABLE>

The credit facility is subject to renewal in September 1999. In the event
the lender does not renew the credit facility, all amounts outstanding will be
due on that date. The above payment table assumes the facility will be
renewed.

(8) LEASES

The Partnerships lease office space in various buildings for its own use
with remaining lease terms ranging from one to ten years. The terms of these
operating leases provide for the Partnerships to pay base rent and a share of
increases in operating expenses and real estate taxes in excess of defined
amounts.

Minimum future lease payments (i.e., base rent) due in each of the next five
years ending December 31 are as follows:

<TABLE>
<CAPTION>
AMOUNT
--------
<S> <C>
1997..................................... $ 3,940
1998..................................... 3,384
1999..................................... 3,308
2000..................................... 3,203
2001..................................... 2,964
Thereafter............................... 11,866
--------
$ 28,665
========
</TABLE>

Rent expense was $4,825, $5,597 and $6,117 during 1994, 1995 and 1996,
respectively. Of these amounts, $2,726, $2,560 and $218 were paid to
affiliates during 1994, 1995 and 1996, respectively.

In anticipation of the expiration of one of its leases on July 31, 1997, the
Partnerships executed a lease to relocate its corporate headquarters in
February 1996. The present value of the net lease obligation from the date of
the move through the end of the current lease term was accrued during 1994
when the Partnerships committed to the relocation plan. Such accrual,
aggregating $3,503, is being amortized as paid over the remaining lease term.
The lease payments related to this period have not been included in the
schedule of minimum future lease payments.

F-14
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO COMBINED FINANCIAL STATEMENTS--(CONCLUDED)

(9) COMPENSATION AND EMPLOYEE BENEFITS

Compensation

Compensation for all professional employees consists of a combination of a
salary and target bonus, which is established on an individual basis at the
beginning of the employees' compensation year. Actual bonuses are based on
individuals meeting stated objectives and other subjective criteria. These
amounts may vary in a year when the operating results of the Partnerships are
significantly above or below the year's business plan. Prior to 1996, the
general partners of DEL shared in a compensation pool which was calculated as
a percentage of net earnings before interest expense on the subordinated notes
of the Partnerships, amortization of intangible assets and other adjustments
as defined in the partnership agreements. Effective January 1, 1996, those
individuals are compensated consistent with the compensation program for all
professional employees of the Partnerships.

Effective January 1, 1996, the Partnerships implemented an Employee
Ownership Program ("Program") which allows employees meeting certain criteria
to receive a portion of their compensation in ownership interests in DEL. The
Partnerships are required to reimburse DEL for the value of such ownership
interests.

The accompanying Combined Statements of Earnings for the years ended
December 31, 1994, 1995 and 1996 include bonus expense of $18,184, $19,419 and
$26,683, respectively, of which $4,584 related to the Program in 1996.

Retirement Plan

The Partnerships have a qualified profit sharing plan which incorporates IRC
Section 401(k) for their eligible employees. Contributions under the qualified
profit sharing plan are made via a combination of employer match and an annual
contribution on behalf of eligible employees. Included in the accompanying
Combined Statements of Earnings for the years ended December 31, 1994, 1995
and 1996 are contributions of $598, $689 and $1,009, respectively.

Related trust assets of the Plan are managed by trustees and are excluded
from the accompanying combined financial statements.

(10) TRANSACTIONS WITH AFFILIATES

Certain partners of DEL have an ownership interest in Diverse Real Estate
Holdings Limited Partnership ("Diverse"). Diverse has an ownership interest in
and operates investment assets, primarily as the managing general partner of
real estate ventures. Included in the accompanying Combined Balance Sheets is
a long term receivable, net of allowance, from Diverse totaling $3,413 and
$2,413 at December 31, 1995 and 1996, respectively. A provision for the
estimated uncollectible portion of the receivable was recorded in the amount
of $1,900 and is included in the accompanying Combined Statements of Earnings
for 1995.

Certain officers of the Partnerships are trustees for real estate funds
which were organized by a subsidiary. The Partnerships earn advisory and
management fees for services rendered to the funds. Included in the
accompanying combined financial statements are revenues of $15,084, $10,502
and $11,635 for 1994, 1995 and 1996, respectively, as well as receivables of
$1,247 and $1,793 at December 31, 1995 and 1996, respectively, related to such
services.

The Partnerships also earn fees and commissions for services rendered to
other affiliates. These affiliates include DSA and its affiliates, real estate
ventures in which the Partnerships have an equity interest, and ventures

F-15
<PAGE>

LA SALLE PARTNERS LIMITED PARTNERSHIP AND SUBSIDIARIES

LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO COMBINED FINANCIAL STATEMENTS--(CONTINUED)

in which Diverse has an ownership interest. Included in the accompanying
combined financial statements are fees and commission revenues from such
affiliates of $16,189, $17,310 and $17,537 for 1994, 1995 and 1996,
respectively, as well as receivables for reimbursable expenses, fees and
commissions as of December 31, 1995 and 1996 of $10,182 and $5,245,
respectively.

In accordance with the partnership agreements, the Partnerships provide
certain administrative services to DEL for which they are not reimbursed.

(11) COMMITMENTS AND CONTINGENCIES

The Partnerships are defendants in various litigation matters arising in the
ordinary course of business, some of which involve claims for damages that are
substantial in amount. Most of these litigation matters are covered by
insurance. In the opinion of management, the ultimate resolution of such
litigation matters will not have a material adverse effect on the financial
position, results of operation or liquidity of the Company.

(12) SUBSEQUENT EVENT

On April 22, 1997, The Galbreath Company, a property management, facility
management and development management company, merged with the Partnerships.

F-16
<PAGE>

INDEPENDENT AUDITORS' REPORT

The Board of Directors
LaSalle Partners Incorporated:

We have audited the accompanying balance sheet of LaSalle Partners
Incorporated as of April 22, 1997. This financial statement is the
responsibility of the Company's management. Our responsibility is to express
an opinion on this financial statement based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the balance sheet is free of
material misstatement. An audit of a balance sheet includes examining, on a
test basis, evidence supporting the amounts and disclosures in that balance
sheet. An audit of a balance sheet also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall balance sheet presentation. We believe that our audit
of the balance sheet provides a reasonable basis for our opinion.

In our opinion, the balance sheet referred to above presents fairly, in all
material respects, the financial position of LaSalle Partners Incorporated as
of April 22, 1997, in conformity with generally accepted accounting
principles.

KPMG Peat Marwick LLP

Chicago, Illinois
April 22, 1997

F-17
<PAGE>

LASALLE PARTNERS INCORPORATED

BALANCE SHEET

APRIL 22, 1997

<TABLE>
<CAPTION>
ASSETS
- ------
<S> <C>
Cash..................................................................... $ 100
=====
<CAPTION>
STOCKHOLDER'S EQUITY
- --------------------
<S> <C>
Stockholder's equity:
Common Stock, $.01 par value; 10,000,000 shares authorized; 10 shares
issued and outstanding................................................ $ --
Additional paid-in capital............................................. 100
-----
Total stockholder's equity........................................... $ 100
=====
</TABLE>

See accompanying notes to Balance Sheet

F-18
<PAGE>

LASALLE PARTNERS INCORPORATED

NOTES TO BALANCE SHEET

APRIL 22, 1997

(1) ORGANIZATION

LaSalle Partners Incorporated was incorporated under the General Corporation
Laws of Maryland on April 15, 1997. The authorized capital stock of the
Company consists of 10,000,000 shares of Common Stock, $.01 par value per
share. The Company expects to amend its Articles of Incorporation to authorize
capital stock of the Company consisting of 100,000,000 shares of Common Stock,
$.01 par value per share and 10,000,000 shares of Preferred Stock, $.01 par
value per share. Each outstanding share of Common Stock will entitle the
holder to one vote for each share on all matters voted on by stockholders,
including the election of Directors.

In the event the Offering is not completed, offering costs incurred will be
borne by LaSalle Partners Limited Partnership and subsidiaries and LaSalle
Partners Management Limited Partnership and subsidiaries on behalf of the
Company.

(2) SUBSEQUENT EVENTS (UNAUDITED)

The Company expects to issue additional shares of Common Stock in the
Company through a public offering (the "Offering"). Immediately prior to the
closing of the Offering, pursuant to agreements among the partners, each of
the general and limited partners of the Predecessor Partnerships will exchange
all of their respective general and limited partnership interests (the
"Partnership Interests Exchange") in the Predecessor Partnerships for an
aggregate of 12,200,000 shares of Common Stock. The Company will cause the
Predecessor Partnerships to contribute, among other things, substantially all
of their respective assets and liabilities (the "Asset Contributions")
relating to: (i) the management services group to LaSalle Partners Management
Services ("LPMS"); (ii) the corporate and financial services group to LaSalle
Partners Corporate & Financial Services ("LPCFS"); and (iii) the investment
management group to LaSalle Advisors Capital Management, Inc. ("LACM").
Following the Partnership Interests Exchange and the Asset Contributions, the
Company will operate as a holding company with the business and operations of
the Predecessor Partnerships being conducted through LPMS, LPCFS, LACM and
LaSalle Partners International, Inc. Due to common control and management of
the Predecessor Partnerships and the Company and identical ownership before
and after the Incorporation Transactions, such transactions are expected to be
accounted for in a manner similar to the accounting used for a pooling of
interests. Thus, the Company's financial statements will include the financial
position and results of operations of the Predecessor Partnerships at their
historical cost basis.

The Company expects to establish an Option and Stock Incentive Plan as
described under the caption "Management."

F-19
<PAGE>

INDEPENDENT AUDITORS' REPORT

To the Owners of
The Galbreath Company and Affiliates:

We have audited the accompanying combined balance sheet of The Galbreath
Company and affiliates as of December 31, 1996, and the related combined
statements of income and owners' equity and of cash flows for the year then
ended. The combined financial statements include the accounts of The Galbreath
Company and affiliated entities as described in Note 1 to the combined
financial statements, all of which are under common ownership and common
management. These financial statements are the responsibility of the
companies' management. Our responsibility is to express an opinion on these
financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.

In our opinion such financial statements present fairly, in all material
respects, the combined financial position of The Galbreath Company and
affiliates at December 31, 1996 and the combined results of their operations
and their combined cash flows for the year then ended in conformity with
generally accepted accounting principles.

Deloitte & Touche LLP

Columbus, Ohio
April 7, 1997
(except for Note 9 as to which
the date is April 22, 1997)

F-20
<PAGE>

THE GALBREATH COMPANY AND AFFILIATES

COMBINED BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER MARCH 31,
ASSETS 31, 1996 1997
- ------ ----------- -----------
(UNAUDITED)
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents.................................. $ 5,805,443 $ 2,688,885
Accounts receivable:
Trade, less allowance for doubtful accounts of $840,000
at 1996 and 1997........................................ 6,709,273 7,532,315
Reimbursable expenses.................................... 1,601,197 1,132,911
Notes receivable........................................... 275,377 227,721
Advances to brokers, customers and other................... 962,249 791,501
Investments:
Securities............................................... 2,932,106 2,974,656
Real estate partnerships................................. 55,992 129,483
Prepaids and other......................................... 635,407 601,384
----------- -----------
Total current assets................................... 18,977,044 16,078,856
FIXED ASSETS--Net............................................ 2,120,459 2,182,838
DEPOSITS AND OTHER ASSETS.................................... 632,953 1,002,953
LONG-TERM NOTES RECEIVABLE-Less current portion.............. 379,677 290,932
----------- -----------
TOTAL........................................................ $22,110,133 $19,555,579
=========== ===========
<CAPTION>
LIABILITIES AND OWNERS' EQUITY
- ------------------------------
<S> <C> <C>
CURRENT LIABILITIES:
Accounts payable--trade.................................... $1,832,743 $1,671,260
Accrued expenses:
Compensation............................................. 2,848,899 457,536
Health and workers' compensation benefits................ 529,241 1,135,626
Commissions.............................................. 4,824,574 3,723,815
Other.................................................... 1,785,745 1,888,150
Demand and other notes payable............................. 930,000 930,000
Current portion of long-term debt.......................... 86,400 82,000
Current portion of capital lease obligations............... 517,100 517,100
----------- -----------
Total current liabilities.............................. 13,354,702 10,405,487
LONG-TERM DEBT-Less current position......................... 278,684 257,084
CAPITAL LEASE OBLIGATIONS--Less current portion.............. 302,939 197,169
OWNERS' EQUITY............................................... 8,173,808 8,695,839
----------- -----------
TOTAL........................................................ $22,110,133 $19,555,579
=========== ===========
</TABLE>

See notes to combined financial statements.

F-21
<PAGE>

THE GALBREATH COMPANY AND AFFILIATES

COMBINED STATEMENTS OF INCOME AND OWNERS' EQUITY

<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEAR ENDED MARCH 31,
DECEMBER 31, ------------------------
1996 1996 1997
------------ ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
REVENUE:
Leasing fees, net of outside broker
fees of $6,637,214, $763,306 and
$1,132,341 for the periods ending
December 31, 1996, March 31, 1996 and
1997, respectively.................... $34,147,028 $ 6,550,517 $ 7,879,961
Management fees........................ 17,171,812 4,187,580 4,510,027
Development fees....................... 2,007,393 395,775 258,469
Other income........................... 4,639,995 1,116,922 855,547
----------- ----------- -----------
Total revenue........................ 57,966,228 12,250,794 13,504,004
----------- ----------- -----------
OPERATING EXPENSES:
Payroll................................ 21,671,229 5,479,076 5,535,148
Brokerage and leasing fees, excluding
outside broker fees................... 20,076,197 3,557,111 4,279,451
Rent................................... 2,810,522 716,124 813,780
Travel and entertainment............... 2,026,774 439,115 422,000
Professional fees...................... 1,726,755 321,727 400,625
Advertising and promotions............. 1,200,427 323,739 213,777
General and administrative............. 2,869,729 725,635 758,738
Other operating expenses............... 1,420,568 305,619 274,330
Depreciation and amortization.......... 701,219 168,113 178,953
----------- ----------- -----------
Total operating expenses............. 54,503,420 12,036,259 12,876,802
----------- ----------- -----------
OPERATING INCOME......................... 3,462,808 214,535 627,202
INTEREST EXPENSE......................... 504,063 97,544 71,617
----------- ----------- -----------
EARNINGS BEFORE PROVISION FOR INCOME
TAXES................................... 2,958,745 116,991 555,585
TAXES.................................... 209,603 33,746 33,554
----------- ----------- -----------
NET INCOME............................... 2,749,142 83,245 522,031
OWNERS' EQUITY, Beginning of period...... 5,548,738 5,548,738 8,173,808
DISTRIBUTIONS TO OWNERS.................. (124,072) (27,354) --
----------- ----------- -----------
OWNERS' EQUITY, End of period............ $ 8,173,808 $ 5,604,629 $ 8,695,839
=========== =========== ===========
</TABLE>

See notes to combined financial statements.

F-22
<PAGE>

THE GALBREATH COMPANY AND AFFILIATES

COMBINED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEAR ENDED MARCH 31,
DECEMBER 31, ------------------------
1996 1996 1997
------------ ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income............................ $ 2,749,142 $ 83,245 $ 522,031
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation and amortization....... 701,219 168,113 178,953
Equity in income of real estate
partnerships....................... (561,681) (42,012) (73,491)
Gain on sale of assets.............. (13,715) -- --
Change in:
Receivables and advances to
brokers, customers and other..... (1,808,602) (1,455,097) (184,008)
Prepaid and other assets.......... 426,350 409,133 (335,977)
Accounts payable--trade........... 707,768 25,314 (161,483)
Accrued expenses.................. 966,852 (1,736,871) (2,783,332)
----------- ----------- -----------
Net cash provided by (used in)
operating activities............ 3,167,333 (2,548,175) (2,837,307)
----------- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of fixed assets.............. (322,600) (96,430) (241,332)
Proceeds from sales of fixed assets... 270,543 -- --
Sales (purchases) of investments--
securities........................... 354,507 (70,493) (42,550)
Change in restricted cash............. 132,345 132,345 --
Collections of notes receivable
issued............................... 205,733 -- 136,401
Increase in notes receivable.......... (503,557) (26,255) --
Distributions from real estate
partnerships......................... 489,373 -- --
----------- ----------- -----------
Net cash provided by (used in)
investing activities............ 626,344 (60,833) (147,481)
----------- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on notes payable, including
capital lease obligations............ (9,077,535) -- (131,770)
Proceeds from notes payable........... 6,996,938 1,947,900 --
Repayment of notes payable............ -- (604,082) --
Distributions to owners............... (124,072) (27,354) --
----------- ----------- -----------
Net cash provided by (used in)
financing activities............ (2,204,669) 1,316,464 (131,770)
----------- ----------- -----------
INCREASE IN CASH....................... 1,589,008 (1,292,544) (3,116,558)
CASH AND CASH EQUIVALENTS--Beginning of
period................................ 4,216,435 4,216,435 5,805,443
----------- ----------- -----------
CASH AND CASH EQUIVALENTS--End of
period................................ $ 5,805,443 $ 2,923,891 $ 2,688,885
=========== =========== ===========
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest................. $ 334,428 $ 70,159 $ 24,331
=========== =========== ===========
Capital lease obligations incurred for
fixed assets.......................... $ 108,237 $ -- $ --
=========== =========== ===========
Transfer of real estate investment to
satisfy demand note payable........... $ 168,000 $ -- $ --
=========== =========== ===========
Transfer of note and accrued interest
receivable to satisfy demand note and
accrued interest payable.............. $ 574,522 $ -- $ --
=========== =========== ===========
Fixed asset additions in accounts
payable............................... $ 46,025 $ -- $ --
=========== =========== ===========
</TABLE>

See notes to combined financial statements.

F-23
<PAGE>

THE GALBREATH COMPANY AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business--The Company leases and manages commercial real
estate properties for related and third parties and provides real estate
brokerage, development and consulting services to clients throughout the
United States. The financial statements have been prepared in accordance with
generally accepted accounting principles (GAAP). The preparation of financial
statements in conformity with GAAP requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.

Principles of Combination--The accompanying combined financial statements
include the accounts of 1) The Galbreath Company and its subsidiary, Galbreath
Florida Region Partnership (collectively "Galbreath Ohio"); 2) The Galbreath
Company of California, Inc. ("Galbreath California"); and 3) Galbreath
Incorporated (formerly The Galbreath Company, Inc.) and its subsidiary, The
Galbreath Company L.P., and its affiliated entities (Galbreath Columbus Circle
Development Corp. and Galbreath Columbus Circle Development Associates L.P.)
(collectively "Galbreath New York"), collectively the "Company." Effective
December 31, 1996, Galbreath Incorporated was merged into The Galbreath
Company. Since the merger involves entities with common ownership, it was
accounted for similar to a pooling of interests. All of the combined entities
have common management and ownership. All significant intercompany balances
and transactions have been eliminated.

Capital--At December 31, 1996, The Galbreath Company had 750 authorized
shares of no-par value common stock with 100 shares outstanding.

At December 31, 1996, Galbreath California had 100 authorized and 10
outstanding shares of Class A Voting common stock without par value and 900
authorized and 90 outstanding shares of Class B Nonvoting common stock without
par value.

At December 31, 1996, Galbreath Columbus Circle Development Corp. had 100
authorized and outstanding shares of no-par value common stock.

Cash and Cash Equivalents--The Company considers all checking accounts, cash
funds and highly liquid debt instruments with original maturities of three
months or less to be cash equivalents. The Company's cash and cash equivalents
are held primarily at five financial institutions at December 31, 1996.

Investment Securities--The Company's investment securities consist primarily
of two mutual funds totaling $2,932,106 at December 31, 1996. The investment
securities are classified as available for sale and are stated at market
value, which approximates cost.

Investments in Real Estate Partnerships--Investments in real estate
partnerships (primarily Galbreath Middle-Atlantic General Partnership and The
Galbreath Company--Southeast) are accounted for using the equity method.

Fixed Assets--Depreciation of fixed assets is computed using the straight-
line method over the estimated useful lives of the assets ranging from three
to ten years.

Income Taxes--Each of the entities comprising the Company is treated as an S
Corporation or partnership for income tax purposes. Accordingly, taxable
income or loss is generally included in the separate income tax returns of the
Company's owners and is not taxable to the Company.

F-24
<PAGE>

THE GALBREATH COMPANY AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS--(CONTINUED)

Employee Savings and Retirement Plan--Company employees may participate in
The Galbreath Company Savings and Retirement Plan. The defined contribution
plan covers all full-time employees of the Company and certain affiliated
companies. Employees may contribute a percentage of their pay to the plan.
Employer contributions of $200,961 in 1996 was at the discretion of the
Company.

Self-Insurance Programs--The Company uses various self-insurance plans for
certain of its health and workers' compensation insurance programs. The
associated liability has been recorded in the financial statements based on
information currently available as to the estimated ultimate cost for
incidents prior to the balance sheet date. Losses in excess of certain limits
are insured with third-party insurance companies.

Revenue Recognition--Revenue is recognized when the service has been
provided or the leasing transaction has been finalized.

The Company manages several buildings for the federal government under the
terms of which the Company is directly responsible for all operating expenses.
The Company receives a fixed fee, based on occupied square footage, which is
reflected in the combined financial statements net of operating expenses of
$10,051,234 for the year ended December 31, 1996.

Advertising--Advertising costs are expensed as incurred.

Litigation--The Company and its subsidiary are defendants in several
lawsuits incidental to their businesses. In the opinion of management, the
outcome of such litigation will not have a material adverse effect on the
Company's combined financial statements.

Fair Value of Financial Instruments--The estimated fair value of cash and
equivalents, accounts receivable, advances to brokers, customers and others,
demand and other notes payable, accounts payable and accrued liabilities
approximate their carrying amounts due to the short maturity of those
instruments. Investments in securities are recorded at fair value based on
market quotations. The estimated fair value of notes receivable and long-term
debt approximate their carrying amounts based on their remaining maturities
and rates currently available to the Company.

Impairment of Long-Lived Assets--The Company adopted the provisions of
Statement of Financial Accounting Standards SFAS No. 121 "Accounting for the
Impairment of Long-lived Assets to be Disposed of," on January 1, 1996. This
Statement requires that long-lived assets and certain identifiable intangibles
are to be reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount of an asset may not be recoverable.
Recoverability of assets to be held and used is measured by a comparison of
the carrying amount of an asset to future net cash flows expected to be
generated by the asset. If such assets are considered to be impaired, the
impairment to be recognized is measured by the amount by which the carrying
value of the assets exceed the fair value of the assets. Assets to be disposed
of are reported at the lower of the carrying amount or fair value less costs
to sell. Adoption of SFAS No. 121 did not have a material impact on the
Company's financial statements.

F-25
<PAGE>

THE GALBREATH COMPANY AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS--(CONTINUED)

2. FIXED ASSETS

The Company's fixed assets at December 31, 1996 were comprised of the
following:

<TABLE>
<S> <C>
Furniture and fixtures $ 1,244,592
Leasehold improvements 747,108
Office equipment 3,412,953
Computer software 315,410
Automobiles 56,310
-----------
Total fixed assets 5,776,373
Accumulated depreciation (3,655,914)
-----------
Fixed assets--net $ 2,120,459
===========
</TABLE>

3. DEMAND AND OTHER NOTES PAYABLE

Demand and other notes payable at December 31, 1996 consist primarily of
unsecured related party notes payable, bearing interest at a fixed rate of 8%.

4. LONG-TERM DEBT

Long-term debt at December 31, 1996 consists of the following:

<TABLE>
<S> <C>
Related parties, unsecured, due in installments to May 1999,
7%-10% $110,676
9.42% Note, unsecured, due in installments to March 1999 245,408
Other 9,000
--------
Total long-term debt 365,084
Less current portion 86,400
--------
Long-term debt--less current portion $278,684
========
</TABLE>

At December 31, 1996 long-term debt matures as follows:

<TABLE>
<S> <C>
Year Ending December 31:
1997 $ 86,400
1998 62,659
1999 216,025
--------
Total $365,084
========
</TABLE>

5. CAPITAL LEASES

The Company has entered into various capital lease agreements primarily
related to office equipment. Such equipment had capitalized cost and book
value of approximately $1,684,000 and $850,000, respectively, at December 31,
1996. Capital leases are due in principal installments of $517,100 in 1997 and
$302,939 in 1998, bearing interest at 7.44%-13.21%.

6. NOTES PAYABLE--LINE-OF-CREDIT

At December 31, 1996, the Company has a financing agreement with a lender
that provides for the following: 1) revolving credit borrowings of up to
$3,500,000 with interest at prime plus .5% and expiring on April 30, 1998; 2)
demand note borrowings of up to $2,000,000 with interest at prime plus 1.0%;
and 3) term note borrowings of up to $500,000 available to October 31, 1997
with interest at prime plus .75%. Amounts

F-26
<PAGE>

THE GALBREATH COMPANY AND AFFILIATES

NOTES TO COMBINED FINANCIAL STATEMENTS--(CONTINUED)

borrowed under the term note are payable in installments from November 1997 to
October 2000. Loans under the financing agreement are secured by accounts
receivable and a pledged securities account. The agreements are subject to a
Subordination Agreement which limits the repayment of certain related party
debt and requires compliance with various covenants. No amounts are
outstanding at December 31, 1996.

7. OPERATING LEASES

The Company leases certain equipment and office space under operating lease
agreements. Total lease expense for 1996 was $2,810,522 net of sublease
rentals of $82,715. Minimum future rental payments under these leases at
December 31, 1996 are as follows:

<TABLE>
<CAPTION>
RELATED
ALL OTHERS PARTY
---------- --------
<S> <C> <C>
Year:
1997 $1,084,935 $ 87,785
1998 634,524 35,581
1999 557,867 12,052
2000 405,895
2001 112,187
Thereafter 84,651
---------- --------
Total $2,880,059 $135,418
========== ========
</TABLE>

8. RELATED PARTY TRANSACTIONS

The Company manages, leases and develops various real estate properties
owned, in part, by entities in which certain owners of the Company have an
interest. Total related party fees from these entities were $3,819,000 in
1996.

The Company incurred leasing commissions, rent and other operating expenses
to entities in which certain owners of the Company have an interest. Total
related party operating expenses incurred to these entities were $348,000 in
1996.

At December 31, 1996, the Company has long-term note receivables of $335,015
due from three related parties in which certain owners of the Company have
interests. These notes bear interest at 9.52%-10% and are due in installments
through May 2000.

9. SUBSEQUENT EVENT

On April 22, 1997, The Galbreath Company and The Galbreath Company of
California, Inc. merged with LaSalle Partners Limited Partnership and LaSalle
Partners Management Limited Partnership, a full-service real estate firm that
provides management services, corporate and financial services and investment
management services to corporations and other worldwide real estate owners,
users and investors.

10. INTERIM INFORMATION (UNAUDITED)

The interim condensed combined financial statements are unaudited but, in
the opinion of management, reflect all adjustments necessary for a fair
presentation of the results of operations and financial position for such
periods. All such adjustments reflected in the interim condensed combined
financial statements are considered to be of a normal recurring nature. The
results of operations for any interim period are not necessarily indicative of
results for the full year. These financial statements should be read in
conjunction with the financial statements and notes thereto for the year ended
December 31, 1996.

F-27
<PAGE>

LOGO
<PAGE>

Issued July 3, 1997

4,000,000 Shares
LOGO
COMMON STOCK

-----------

ALL OF THE 4,000,000 SHARES OF COMMON STOCK OFFERED HEREBY ARE BEING SOLD BY
THE COMPANY. OF THE 4,000,000 SHARES OF COMMON STOCK BEING OFFERED, 800,000
SHARES ARE BEING OFFERED INITIALLY OUTSIDE OF THE UNITED STATES AND
CANADA BY THE INTERNATIONAL UNDERWRITERS AND 3,200,000 SHARES ARE BEING
OFFERED INITIALLY IN THE UNITED STATES AND CANADA BY THE U.S.
UNDERWRITERS. SEE "UNDERWRITERS." PRIOR TO THIS OFFERING, THERE HAS
BEEN NO PUBLIC MARKET FOR THE COMMON STOCK OF THE COMPANY. IT IS
CURRENTLY ESTIMATED THAT THE INITIAL OFFERING PRICE PER SHARE
OF COMMON STOCK WILL BE BETWEEN $19 AND $21. SEE
"UNDERWRITERS" FOR A DISCUSSION OF THE FACTORS TO BE
CONSIDERED IN DETERMINING THE INITIAL PUBLIC OFFERING
PRICE.

-----------

APPLICATION HAS BEEN MADE TO LIST THE COMMON STOCK ON THE NEW YORK STOCK
EXCHANGE UNDER THE SYMBOL "LAP."

-----------

SEE "RISK FACTORS" BEGINNING ON PAGE 10 OF THIS PROSPECTUS FOR
INFORMATION THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.

-----------

-----------
PRICE $ A SHARE
-----------

-----------

MORGAN STANLEY DEAN WITTER

WILLIAM BLAIR & COMPANY

MONTGOMERY SECURITIES

, 1997
<PAGE>

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The estimated expenses in connection with the Offering are as follows:

<TABLE>
<CAPTION>
EXPENSES AMOUNT
-------- ----------
<S> <C>
SEC Registration Fee ......................................... $ 27,879
NASD Fee ..................................................... 9,700
New York Stock Exchange Fee .................................. 81,100
Printing Expenses ............................................ 225,000
Legal Fees and Expenses ...................................... 1,150,000
Transfer Agent and Registrar Fees............................. 10,000
Accounting Fees and Expenses ................................. 275,000
Miscellaneous Expenses ....................................... 221,321
----------
Total..................................................... $2,000,000
==========
</TABLE>

ITEM 14. INDEMNIFICATION OF OFFICERS AND DIRECTORS.

The Restated Articles of Incorporation will relieve the Company's directors
from monetary damages to the Company or its stockholders for breach of such
directors' fiduciary duty as directors. Section 2-418 of the MGCL empowers the
Company to indemnify, subject to the standards contained therein, any person
in connection with any action, suit or proceeding brought or threatened by
reason of the fact that such person was a director, officer, employee or agent
of the Company, or is or was serving as such with respect to another entity at
the request of the Company. The MGCL also provides that the Company may
purchase insurance on behalf of any such director, officer, employee or agent.
The Company's Restated Articles of Incorporation and Bylaws will provide for
the indemnification of each director and officer of the Company to the fullest
extent permitted by applicable law.

Section 9 of the Underwriting Agreement between the Company and the
Underwriters, a form of which is filed as Exhibit 1.01 hereto, provides for
indemnification by the Company of the Underwriters and each person, if any,
who controls any Underwriter, against certain liabilities and expenses, as
stated therein, including liabilities under the Securities Act of 1933, as
amended.

The Company intends to obtain directors' and officers' liability insurance
("D&O Insurance") prior to the effective date of the Offering, and expects to
continue to carry D&O Insurance following such date. In addition, the Company
will enter into an indemnification agreement with each of its directors and
certain officers of the Company. The D&O Insurance and the indemnification
agreements will insure the Company's officers and directors against certain
liabilities, including liabilities under the securities laws. The Company
expects that the indemnification agreements will indemnify and advance
expenses to its directors and officers to the fullest extent permitted by the
MGCL.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.

Immediately prior to the closing of the Offering, each of the general and
limited partners of LaSalle Partners Limited Partnership and LaSalle Partners
Management Limited Partnership will contribute all of their respective general
and limited partnership interests in such partnerships to the Company in
exchange for an aggregate of 12,200,000 shares of Common Stock. The issuances
of Common Stock will constitute a "transaction by any issuer not involving any
public offering" and thus will be exempt from the registration requirements of
the Securities Act of 1933 (the "Act") under Section 4(2) thereof.

II-1
<PAGE>

ITEM 16. EXHIBITS.

(a) EXHIBITS.

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
1.01* Form of Underwriting Agreement
2.01* Subscription Agreement
3.01** Articles of Incorporation of LaSalle Partners Incorporated
3.02** Bylaws of LaSalle Partners Incorporated
3.03** Form of Articles of Amendment and Restatement of LaSalle Partners
Incorporated
3.04** Form of Amended and Restated Bylaws of LaSalle Partners
Incorporated
4.01* Form of certificate representing shares of Common Stock
5.01* Opinion and consent of Skadden, Arps, Slate, Meagher & Flom
(Illinois)
5.02 Opinion and consent of Piper & Marbury L.L.P.
10.01** Credit Agreement, dated as of September 6, 1996, by and among
LaSalle Partners Management Limited Partnership ("LPML"), LaSalle
Partners Limited Partnership ("LPL") and Harris Trust and Savings
Bank ("Harris")
10.02** Security Agreement, dated as of September 6, 1996, by and among
LPL, LPML and Harris
10.03** Supporting Subsidiary Security Agreement, dated as of September 6,
1996, by and among certain subsidiaries named therein and Harris
10.04** Pledge and Security Agreement, dated as of September 6, 1996, by
and among LPL, LPML and Harris
10.05** Collateral Assignment of Partnership Interests, dated as of
September 6, 1996, by and among LPL, LPML and Harris
10.06** Subsidiary Collateral Assignment of Partnership Interests, dated
as of September 6, 1996, by and among certain subsidiaries named
therein and Harris
10.07** Guaranty Agreement, dated as of September 6, 1996, by and among
certain subsidiaries or affiliates of LPL or LPML and Harris
10.08** Contribution and Exchange Agreement, dated as of April 21, 1997,
by and among DEL-LPL Limited Partnership ("DEL-LPL"), DEL-LPAML
Limited Partnership ("DEL-LPAML"), LPL, LPML, The Galbreath
Company ("Galbreath"), Galbreath Company of California, Inc.,
Galbreath Holdings, LLC ("Galbreath Holdings") and the
stockholders of Galbreath
10.09** Agreement for the sale and purchase of shares in CIN Property
Management Limited, dated October 8, 1996, by and between British
Coal Corporation and LaSalle Partners International
10.10** Asset Purchase Agreement, dated as of December 31, 1996, by and
among LaSalle Construction Limited Partnership, LPL, Clune
Construction Company, L.P. and Michael T. Clune
10.11** LaSalle Partners Incorporated 1997 Stock Award and Incentive Plan
10.12** Form of LaSalle Partners Incorporated Employee Stock Purchase Plan
10.13* Form of LaSalle Partners Incorporated Stock Compensation Program
</TABLE>

II-2
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
10.14** Registration Rights Agreement, dated as of April 22, 1997, by and
among LaSalle Partners Incorporated, LPL, LPML, DEL-LPL, DEL-
LPAML, DSA-LSPL, Inc. ("DSA-LSPL"), DSA-LSAM, Inc. ("DSA-LSAM")
and Galbreath Holdings
10.15* Form of Indemnification Agreement
10.16** Consent Agreement, dated as of April 15, 1997, by and among DSA-
LSPL, DSA-LSAM, DEL-LPL, DEL-LPAML, DEL/LaSalle Finance Company,
L.L.C. ("DEL/LaSalle"), LPL and LPML
10.17** Consent Agreement, dated as of April 22, 1997, by and among the
Stockholders of Galbreath and the Galbreath Company of
California, Inc., Galbreath Holdings, DEL-LPL, DEL-LPAML,
DEL/LaSalle, LPL and LPML.
21.01** List of Subsidiaries
23.01 Consent of KPMG Peat Marwick LLP, independent auditors
23.02 Consent of Deloitte & Touche, LLP, independent auditors
23.03* Consent of Skadden, Arps, Slate, Meagher & Flom (Illinois)
(included in Exhibit 5.01)
23.04** Consent of Piper & Marbury L.L.P. (included in Exhibit 5.02)
23.05** Consent of Darryl Hartley-Leonard
23.06** Consent of Thomas C. Theobald
24.01** Power of Attorney
27.01** Financial Data Schedule
</TABLE>
- --------
*To be filed by Amendment
**Previously filed

(b) Financial Statement Schedules.

All schedules for which provision is made in the applicable accounting
regulations of the Securities and Exchange Commission have been omitted
because they are not required under the related instructions, are not
applicable or the information has been provided in the Financial Statements,
or the notes thereto, included in this Registration Statement.

II-3
<PAGE>

ITEM 17. UNDERTAKINGS.

Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the registrant has been
advised that, in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the
registrant in the successful defense in any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with
the securities being registered, the registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be governed by
the final adjudication of such issue.

The undersigned registrant hereby undertakes that:

(1) For purposes of determining any liability under the Act, the
information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Act shall be deemed to be part of this registration
statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Act, each
post-effective amendment that contains a form of prospectus shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.

The undersigned registrant hereby undertakes to provide to the Underwriters
at the closing specified in the underwriting agreements, certificates in such
denominations and registered in such names as required by the Underwriters to
permit prompt delivery to each purchaser.

II-4
<PAGE>

SIGNATURES

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS AMENDMENT TO THE REGISTRATION STATEMENT TO BE SIGNED ON
ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF
CHICAGO, STATE OF ILLINOIS, ON JULY 3, 1997.

LaSalle Partners Incorporated

*
By: _________________________________
Stuart L. Scott
Chief Executive Officer

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS AMENDMENT TO
THE REGISTRATION STATEMENT TO BE SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON THE DATES INDICATED.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----

<S> <C> <C>
* Chairman of the Board of Directors July 3, 1997
____________________________________ and Chief Executive Officer
Stuart L. Scott (Principal Executive Officer)

* President, Chief Operating Officer July 3, 1997
____________________________________ and Director
Robert C. Spoerri

* Executive Vice President, Chief July 3, 1997
____________________________________ Financial Officer and Director
William E. Sullivan (Principal Financial Officer and
Principal Accounting Officer)

* Co-President--LaSalle Advisors July 3, 1997
____________________________________ Capital Management, Inc. and
Daniel W. Cummings Director

* President and Chief Executive July 3, 1997
____________________________________ Officer--LaSalle Partners
Charles K. Esler Management Services, Inc.
and Director

* President, Tenant Representation July 3, 1997
____________________________________ Division--LaSalle Partners
M. G. Rose Management Services, Inc.
and Director

* Co-President--LaSalle Advisors July 3, 1997
____________________________________ Capital Management, Inc. and
Lynn C. Thurber Director

* Managing Director, Investment July 3, 1997
____________________________________ Banking Division, LaSalle
Earl E. Webb Partners Corporate & Financial
Services, Inc. and Director

</TABLE>

II-5
<PAGE>

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----

<S> <C> <C>
* Chairman, LaSalle Partners July 3, 1997
____________________________________ Management Services, Inc.
Lizanne Galbreath and Director
</TABLE>

/s/ William E. Sullivan
*By: __________________________
William E. Sullivan
Attorney-in-fact

II-6
<PAGE>

EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT SEQUENTIAL
NUMBER DESCRIPTION PAGE NUMBER
------- ----------- -----------
<C> <S> <C>
1.01* Form of Underwriting Agreement
2.01* Subscription Agreement
3.01** Articles of Incorporation of LaSalle Partners
Incorporated
3.02** Bylaws of LaSalle Partners Incorporated
3.03** Form of Articles of Amendment and Restatement of LaSalle
Partners Incorporated
3.04** Form of Amended and Restated Bylaws of LaSalle Partners
Incorporated
4.01* Form of certificate representing shares of Common Stock
5.01* Opinion and consent of Skadden, Arps, Slate, Meagher &
Flom (Illinois)
5.02 Opinion and consent of Piper & Marbury L.L.P.
10.01** Credit Agreement, dated as of September 6, 1996, by and
among LaSalle Partners Management Limited Partnership
("LPML"), LaSalle Partners Limited Partnership ("LPL")
and Harris Trust and Savings Bank ("Harris")
10.02** Security Agreement, dated as of September 6, 1996, by
and among LPL, LPML and Harris
10.03** Supporting Subsidiary Security Agreement, dated as of
September 6, 1996, by and among certain subsidiaries
named therein and Harris
10.04** Pledge and Security Agreement, dated as of September 6,
1996, by and among LPL, LPML and Harris
10.05** Collateral Assignment of Partnership Interests, dated as
of September 6, 1996, by and among LPL, LPML and Harris
10.06** Subsidiary Collateral Assignment of Partnership
Interests, dated as of September 6, 1996, by and among
certain subsidiaries named therein and Harris
10.07** Guaranty Agreement, dated as of September 6, 1996, by
and among certain subsidiaries or affiliates of LPL or
LPML and Harris
10.08** Contribution and Exchange Agreement, dated as of April
21, 1997, by and among DEL-LPL Limited Partnership
("DEL-LPL"), DEL-LPAML Limited Partnership ("DEL-
LPAML"), LPL, LPML, The Galbreath Company
("Galbreath"), Galbreath Company of California, Inc.,
Galbreath Holdings, LLC ("Galbreath Holdings") and the
stockholders of Galbreath
10.09** Agreement for the sale and purchase of shares in CIN
Property Management Limited, dated October 8, 1996, by
and between British Coal Corporation and LaSalle
Partners International
10.10** Asset Purchase Agreement, dated as of December 31, 1996,
by and among LaSalle Construction Limited Partnership,
LPL, Clune Construction Company, L.P. and Michael T.
Clune
10.11** LaSalle Partners Incorporated 1997 Stock Award and
Incentive Plan
10.12** Form of LaSalle Partners Incorporated Employee Stock
Purchase Plan
10.13* Form of LaSalle Partners Incorporated Stock Compensation
Program
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
EXHIBIT SEQUENTIAL
NUMBER DESCRIPTION PAGE NUMBER
------- ----------- -----------
<C> <S> <C>
10.14** Registration Rights Agreement, dated as of April 22,
1997, by and among LaSalle Partners Incorporated, LPL,
LPML, DEL-LPL, DEL-LPAML, DSA-LSPL, Inc. ("DSA-LSPL"),
DSA-LSAM, Inc. ("DSA-LSAM") and Galbreath Holdings
10.15* Form of Indemnification Agreement
10.16** Consent Agreement, dated as of April 15, 1997, by and
among DSA-LSPL, DSA-LSAM, DEL-LPL, DEL-LPAML,
DEL/LaSalle Finance Company, L.L.C. ("DEL/LaSalle"),
LPL and LPML
10.17** Consent Agreement, dated as of April 22, 1997, by and
among the Stockholders of Galbreath and the Galbreath
Company of California, Inc., Galbreath Holdings LLC,
DEL-LPL, DEL-LPAML, DEL/LaSalle, LPL and LPML
21.01** List of Subsidiaries
23.01 Consent of KPMG Peat Marwick LLP, independent auditors
23.02 Consent of Deloitte & Touche LLP, independent auditors
23.03* Consent of Skadden, Arps, Slate, Meagher & Flom
(Illinois) (included in Exhibit 5.01)
23.04** Consent of Piper & Marbury L.L.P. (included in Exhibit
5.02)
23.05** Consent of Darryl Hartley-Leonard
23.06** Consent of Thomas C. Theobald
24.01** Power of Attorney
27.01** Financial Data Schedule
</TABLE>
- --------
*To be filed by Amendment
**Previously filed

<PAGE>

EXHIBIT 5.02

Piper & Marbury
L.L.P.
CHARLES CENTER SOUTH WASHINGTON
36 SOUTH CHARLES STREET NEW YORK
BALTIMORE, MARYLAND 21201-3018 PHILADELPHIA
410-539-2530 EASTON
FAX: 410-539-0489

June 17, 1997

LaSalle Partners Incorporated
200 East Randolph Drive
Chicago, Illinois 60601

Re: LaSalle Partners Incorporated
-----------------------------

Ladies and Gentlemen:

We have acted as Maryland counsel to LaSalle Partners Incorporated, a
Maryland corporation (the "Company"), in connection with the registration
statement on Form S-1 (the "Original Registration Statement") filed with the
Securities and Exchange Commission on April 24, 1997, and Amendment No. 1 to the
Original Registration Statement filed on May 8, 1997 (the "First Amendment," and
together with the Original Registration Statement, the "Registration
Statement"), relating to the offering (including an over-allotment option) of an
aggregate of 4,600,000 shares of the Company's common stock, $.01 par value (the
"Shares").

In our capacity as Maryland counsel, we have reviewed the following:

(a) The Charter of the Company, as amended to date (the "Charter"),
certified by the Maryland State Department of Assessments and Taxation
(the "Department");

(b) A copy of the By-laws of the Company certified by an officer of the
Company, as in effect on the date hereof (the "By-laws");

(d) Certified resolutions of the Board of Directors of the Company
authorizing the Registration Statement and the issuance of the Shares;

<PAGE>

PIPER & MARBURY
L.L.P

LaSalle Partners Incorporated
June 17, 1997
Page 2

(e) A good standing certificate for the Company of recent date issued by
the Department;

(f) A Certificate of the Secretary of the Company dated June 17, 1997 as
to certain factual matters including the issuance of the Shares; and

(g) Such other documents as we have considered necessary to the rendering
of the opinion expressed below.

In our examination of the aforesaid documents, we have assumed, without
independent investigation, that the Shares have been or will be issued in
accordance with the terms of the resolutions authorizing their issuance. In
such examination we also have assumed, without independent investigation, the
genuineness of all signatures, the legal capacity of all individuals who have
executed any of the aforesaid documents, the authenticity of all documents
submitted to us as originals, the conformity with originals of all documents
submitted to us as copies (and the authenticity of the originals of such copies)
and that all public records reviewed are accurate and complete. As to factual
matters (including, without limitation, the issuance of capital stock) we have
relied on the Certificate of the Secretary of the Company referenced in
paragraph (f) above and have not independently verified the matters stated
therein.

Based upon the foregoing, having regard for such legal considerations as we
deem relevant, and limited in all respects to applicable Maryland law, we are of
the opinion and advise you as follows:

(1) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Maryland.

(2) When issued and paid for in the manner contemplated by the
Registration Statement, the Shares will be legally issued, fully paid
and nonassessable.

<PAGE>

PIPER & MARBURY
L.L.P.

LaSalle Partners Incorporated
June 17, 1997
Page 3

The opinions expressed above are limited to the law of Maryland, exclusive
of the securities or "blue sky" laws of the State of Maryland. We hereby consent
to the filing of this opinion as Exhibit 5 to the Registration Statement and to
the reference to our firm in the Registration Statement.

Very truly yours,

/s/ Piper & Marbury L.L.P.

<PAGE>

EXHIBIT 23.01

The Board of Directors
LaSalle Partners Incorporated:

We consent to the use of our reports included herein and to the reference to our
firm under the headings "Selected Financial Data" and "Experts" in the
Prospectus.

KPMG PEAT MARWICK LLP

Chicago, Illinois

July 2, 1997

<PAGE>

Exhibit 23.02

INDEPENDENT AUDITORS' CONSENT

We consent to the use in this Amendment No. 3 to Registration Statement No.
333-25741 of LaSalle Partners Incorporated on Form S-1 of our report regarding
The Galbreath Company and Affiliates dated April 7, 1997 (except for Note 9 as
to which the date is April 22, 1997), appearing in the Prospectus, which is part
of this Registration Statement.

We also consent to the reference to us under the heading "Experts" in such
Prospectus.

DELOITTE & TOUCHE LLP
Columbus, Ohio

July 2, 1997