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

                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

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

                                   FORM 10-Q

(MARK ONE)

<TABLE>
<C>        <S>
   /X/     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
           SECURITIES EXCHANGE ACT OF 1934
</TABLE>

                 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000,
                                       OR

<TABLE>
<C>        <S>
   / /     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
           SECURITIES EXCHANGE ACT OF 1934
</TABLE>

        FOR THE TRANSITION PERIOD FROM ______________ TO ______________

                         COMMISSION FILE NUMBER 1-13531

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

                             TRAMMELL CROW COMPANY

             (Exact name of registrant as specified in its charter)

<TABLE>
<S>                                            <C>
               DELAWARE                                     75-2721454
    (State or other jurisdiction of            (IRS Employer Identification Number)
    Incorporation or organization)

           2001 ROSS AVENUE                                   75201
              SUITE 3400                                    (Zip Code)
             DALLAS, TEXAS
    (Address of principal executive
               offices)
</TABLE>

      (214) 863-3000 (Registrant's telephone number, including area code)

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

    Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes /X/  No / /

    At August 9, 2000 there were 35,174,463 shares of Common Stock outstanding.

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>
                     TRAMMELL CROW COMPANY AND SUBSIDIARIES
                                     INDEX

<TABLE>
<CAPTION>
                                                                           PAGE
                                                                          NUMBER
                                                                         --------
<C>        <S>                                                           <C>

 PART I.   Financial Information

 Item 1.   Financial Statements

           Condensed Consolidated Balance Sheets as of June 30, 2000
           (unaudited) and December 31, 1999...........................      3

           Condensed Consolidated Statements of Income for the three
           and six months ended June 30, 2000 and 1999 (unaudited).....      4

           Condensed Consolidated Statements of Stockholders' Equity
           for the six months ended June 30, 2000 (unaudited) and the
           year ended December 31, 1999................................      5

           Condensed Consolidated Statements of Cash Flows for the six
           months ended June 30, 2000 and 1999 (unaudited).............      6

           Notes to Condensed Consolidated Financial Statements
           (unaudited).................................................      7

 Item 2.   Management's Discussion and Analysis of Financial Condition
           and Results of Operations...................................     15

 Item 3.   Quantitative and Qualitative Disclosures About Market
           Risk........................................................     20

PART II.   Other Information

 Item 1.   Legal Proceedings...........................................     21

 Item 4.   Submission of Matters to a Vote of Security Holders.........     21

 Item 6.   Exhibits and Reports on Form 8-K............................     21
</TABLE>

                                       2
<PAGE>
PART I-FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                     TRAMMELL CROW COMPANY AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
                                     ASSETS

<TABLE>
<CAPTION>
                                                               JUNE 30,     DECEMBER 31,
                                                                 2000           1999
                                                              -----------   -------------
                                                              (UNAUDITED)
<S>                                                           <C>           <C>
Current assets

  Cash and cash equivalents.................................    $ 29,716      $ 47,528
  Accounts receivable, net of allowance for doubtful
    accounts of $3,863 in 2000 and $3,053 in 1999...........     112,335       122,626
  Receivables from affiliates...............................      10,135         3,333
  Notes and other receivables...............................       8,955         8,510
  Deferred income taxes.....................................       1,568         1,585
  Real estate held for sale.................................     231,064       219,390
  Other current assets......................................      18,987        16,047
                                                                --------      --------
  Total current assets......................................     412,760       419,019
Furniture and equipment, net................................      26,009        23,116
Deferred income taxes.......................................       6,920         7,086
Investments in unconsolidated subsidiaries..................      57,055        37,291
Goodwill, net...............................................     120,098       119,107
Other assets................................................      41,461        32,391
                                                                --------      --------
                                                                $664,303      $638,010
                                                                ========      ========
                          LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
  Accounts payable..........................................    $ 45,132      $ 47,819
  Accrued expenses..........................................      82,246        93,273
  Payables to affiliates....................................         490           730
  Income taxes payable......................................         445         6,935
  Current portion of long-term debt.........................       2,111         1,443
  Notes payable on real estate held for sale................     145,365       134,827
  Other current liabilities.................................      10,136         2,757
                                                                --------      --------
  Total current liabilities.................................     285,925       287,784
Long-term debt, less current portion........................      78,742        62,641
Other liabilities...........................................       1,119         1,780
                                                                --------      --------
  Total liabilities.........................................     365,786       352,205
Minority interest...........................................      32,858        34,153
Stockholders' equity
  Preferred stock; $0.01 par value; 30,000,000 shares
    authorized; none issued or outstanding..................          --            --
  Common stock; $0.01 par value; 100,000,000 shares
    authorized; 35,791,608 shares issued and 35,010,085
    shares outstanding in 2000, and 35,581,620 shares issued
    and 34,779,895 shares outstanding in 1999...............         358           356
  Paid-in capital...........................................     176,148       174,645
  Retained earnings.........................................     100,236        88,160
  Less: Treasury stock......................................      (9,116)       (9,363)
       Stockholder loans....................................          --           (98)
       Unearned stock compensation, net.....................      (1,967)       (2,048)
                                                                --------      --------
Total stockholders' equity..................................     265,659       251,652
                                                                --------      --------
                                                                $664,303      $638,010
                                                                ========      ========
</TABLE>

                            See accompanying notes.

                                       3
<PAGE>
                     TRAMMELL CROW COMPANY AND SUBSIDIARIES

                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME

                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                 FOR THE THREE MONTHS       FOR THE SIX MONTHS
                                                     ENDED JUNE 30             ENDED JUNE 30
                                                -----------------------   -----------------------
                                                   2000         1999         2000         1999
                                                ----------   ----------   ----------   ----------
                                                 (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<S>                                             <C>          <C>          <C>          <C>
REVENUES
  CORPORATE:
  Facilities management.......................  $   31,305   $   21,613   $   60,680   $   39,778
  Corporate advisory services.................      38,398       23,358       64,517       43,126
  Project management services.................      11,967        6,462       23,555       11,804
  Gain (loss) on disposition of real estate...          75          (30)         168          (12)
  Other.......................................          64           49          147          104
                                                ----------   ----------   ----------   ----------
                                                    81,809       51,452      149,067       94,800

  INSTITUTIONAL:
  Property management.........................      39,625       37,017       79,491       74,515
  Brokerage services..........................      39,541       32,093       69,292       58,678
  Development services........................      20,629       17,354       39,607       43,121
  Income from investments in unconsolidated
    subsidiaries..............................         924        2,091        2,563        2,336
  Gain on disposition of real estate..........       2,798        9,157        8,304       10,110
  Other.......................................         764          572        1,010          965
                                                ----------   ----------   ----------   ----------
                                                   104,281       98,284      200,267      189,725
  E-COMMERCE:
  Other.......................................          55           --           55           --
                                                ----------   ----------   ----------   ----------
                                                   186,145      149,736      349,389      284,525
COSTS AND EXPENSES
  Salaries, wages and benefits................     100,357       81,893      201,220      162,605
  Commissions.................................      30,920       21,580       52,267       37,724
  General and administrative..................      28,323       25,078       53,802       45,369
  Depreciation and amortization...............       6,351        4,122       11,017        7,767
  Interest....................................       4,243        1,954        7,744        3,918
  Minority interest...........................       1,961        1,286        3,180        1,407
                                                ----------   ----------   ----------   ----------
                                                   172,155      135,913      329,230      258,790
                                                ----------   ----------   ----------   ----------
Income before income taxes....................      13,990       13,823       20,159       25,735
Income tax expense............................       5,597        5,559        8,066       10,368
                                                ----------   ----------   ----------   ----------
Net income....................................  $    8,393   $    8,264   $   12,093   $   15,367
                                                ==========   ==========   ==========   ==========
Earnings per share:
  Basic                                         $     0.24   $     0.24   $     0.35   $     0.44
                                                ==========   ==========   ==========   ==========
  Diluted.....................................  $     0.23   $     0.23   $     0.34   $     0.42
                                                ==========   ==========   ==========   ==========
Weighted average common shares outstanding:
  Basic.......................................  34,751,269   34,935,811   34,718,472   34,729,381
  Diluted.....................................  36,018,449   36,356,780   35,961,043   36,295,586
</TABLE>

                            See accompanying notes.

                                       4
<PAGE>
                     TRAMMELL CROW COMPANY AND SUBSIDIARIES

           CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

  SIX MONTHS ENDED JUNE 30, 2000 (UNAUDITED) AND YEAR ENDED DECEMBER 31, 1999

                       (IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
                                     COMMON SHARES        COMMON                                                      UNEARNED
                                 ---------------------     STOCK     PAID-IN    RETAINED   TREASURY   STOCKHOLDER       STOCK
                                   ISSUED     TREASURY   PAR VALUE   CAPITAL    EARNINGS   STOCK(1)      LOANS      COMPENSATION
                                 ----------   --------   ---------   --------   --------   --------   -----------   -------------
<S>                              <C>          <C>        <C>         <C>        <C>        <C>        <C>           <C>
Balance at January 1, 1999.....  34,477,825     1,587      $345      $160,733   $33,717    $    --       $(904)        $(1,879)
  Net income...................          --        --        --            --    54,443         --          --              --
  Issuance of restricted
    stock......................     128,347    (3,174)        1         2,226        --         --          --          (2,227)
  Forfeiture of restricted
    stock......................          --    22,412        --          (162)       --       (315)         --             272
  Amortization of restricted
    stock......................          --        --        --            --        --         --          --           1,786
  Issuance of common stock.....     975,448        --        10        11,848        --         --          --              --
  Stock repurchase.............          --   780,900        --            --        --     (9,048)         --              --
  Collection of stockholder
    loans......................          --        --        --            --        --         --         806              --
                                 ----------   -------      ----      --------   --------   -------       -----         -------
Balance at December 31, 1999...  35,581,620   801,725       356       174,645    88,160     (9,363)        (98)         (2,048)
  Net income...................          --        --        --            --    12,093         --          --              --
  Issuance of restricted
    stock......................          --   (77,763)       --            10       (17)       907          --            (900)
  Forfeiture of restricted
    stock......................          --     7,761        --          (109)       --        (94)         --              61
  Amortization of restricted
    stock......................          --        --        --            --        --         --          --             920
  Issuance of common stock.....     209,988        --         2         1,602        --         --          --              --
  Stock repurchase.............          --    49,800        --            --        --       (566)         --              --
  Collection of stockholder
    loans......................          --        --        --            --        --         --          98              --
                                 ----------   -------      ----      --------   --------   -------       -----         -------
Balance at June 30, 2000.......  35,791,608   781,523      $358      $176,148   $100,236   $(9,116)      $  --         $(1,967)

<CAPTION>

                                  TOTAL
                                 --------
<S>                              <C>
Balance at January 1, 1999.....  $192,012
  Net income...................    54,443
  Issuance of restricted
    stock......................        --
  Forfeiture of restricted
    stock......................      (205)
  Amortization of restricted
    stock......................     1,786
  Issuance of common stock.....    11,858
  Stock repurchase.............    (9,048)
  Collection of stockholder
    loans......................       806
                                 --------
Balance at December 31, 1999...   251,652
  Net income...................    12,093
  Issuance of restricted
    stock......................        --
  Forfeiture of restricted
    stock......................      (142)
  Amortization of restricted
    stock......................       920
  Issuance of common stock.....     1,604
  Stock repurchase.............      (566)
  Collection of stockholder
    loans......................        98
                                 --------
Balance at June 30, 2000.......  $265,659
</TABLE>

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

(1) Treasury stock at January 1, 1999 rounds to less than $1.

                            See accompanying notes.

                                       5
<PAGE>
                     TRAMMELL CROW COMPANY AND SUBSIDIARIES

                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                  FOR THE SIX MONTHS
                                                                    ENDED JUNE 30
                                                                 2000            1999
                                                              ----------      ----------
                                                                (IN THOUSANDS, EXCEPT
                                                              SHARE AND PER SHARE DATA)
<S>                                                           <C>             <C>
OPERATING ACTIVITIES
Net income..................................................   $ 12,093        $ 15,367
  Adjustments to reconcile net income to net cash used in
    operating activities
  Depreciation and amortization.............................     11,017           7,767
  Amortization of employment contracts and unearned
    compensation............................................      2,249           1,371
  Expense for stock issued to vendors.......................         --             172
  Minority interest.........................................      3,180           1,407
  Deferred income tax provision.............................        183           1,305
  Income from investments in unconsolidated subsidiaries....     (2,563)         (2,336)
  Changes in operating assets and liabilities, net of
    acquisitions
    Accounts receivable.....................................     10,291          (3,172)
    Receivables from affiliates.............................     (6,802)         (3,827)
    Notes receivable and other assets.......................    (17,091)        (16,007)
    Real estate held for sale...............................    (34,943)        (52,185)
    Notes payable on real estate held for sale..............     32,886          46,373
    Accounts payable and accrued expenses...................    (13,043)        (10,029)
    Payables to affiliates..................................       (240)           (496)
    Income taxes payable....................................     (6,490)          1,481
    Other liabilities.......................................      6,718           1,258
                                                               --------        --------
Net cash used in operating activities.......................     (2,555)        (11,551)
INVESTING ACTIVITIES
Expenditures for furniture and equipment....................     (8,694)         (7,975)
Acquisitions of real estate service companies...............     (3,253)         (2,205)
Investments in unconsolidated subsidiaries..................    (24,200)         (4,951)
Distributions from unconsolidated subsidiaries..............      7,458           5,435
                                                               --------        --------
Net cash used in investing activities.......................    (28,689)         (9,696)
FINANCING ACTIVITIES
Principal payments on debt..................................    (53,949)        (31,069)
Proceeds from debt..........................................     70,720             150
Contributions from minority interest........................      3,743           9,759
Distributions to minority interest..........................     (8,218)         (2,820)
Purchase of common stock....................................       (566)             --
Proceeds from exercise of stock options.....................        237           1,425
Proceeds from issuance of common stock......................      1,367           2,730
Collections of stockholder loans............................         98             806
                                                               --------        --------
Net cash provided by (used in) financing activities.........     13,432         (19,019)
                                                               --------        --------
Net decrease in cash and cash equivalents...................    (17,812)        (40,266)
Cash and cash equivalents, beginning of period..............     47,528          87,946
                                                               --------        --------
Cash and cash equivalents, end of period....................   $ 29,716        $ 47,680
                                                               ========        ========
</TABLE>

                            See accompanying notes.

                                       6
<PAGE>
                     TRAMMELL CROW COMPANY AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                 JUNE 30, 2000

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

                                  (UNAUDITED)

1. GENERAL

    The consolidated interim financial statements of Trammell Crow Company (the
"Company") included herein have been prepared in accordance with the
requirements for interim financial statements and do not include all disclosures
required under generally accepted accounting principles ("GAAP") for complete
financial statements. These financial statements should be read in conjunction
with the consolidated financial statements included in the Company's annual
report on Form 10-K for the year ended December 31, 1999. In the opinion of
management, all adjustments and eliminations, consisting only of recurring
adjustments, necessary for a fair presentation of the financial statements for
the interim periods have been made. Interim results of operations are not
necessarily indicative of the results to be expected for the full year.

    The Company has experienced and expects to continue to experience quarterly
variations in revenues and net income as a result of several factors. The
Company's revenues tend to be higher in the last quarter of the year than in the
first three quarters because its clients have demonstrated a tendency to close
transactions toward the end of the year. The timing and introduction of new
contracts, the disposition of investments in real estate assets and other
factors may also cause quarterly fluctuations in the Company's results of
operations.

USE OF ESTIMATES

    The preparation of the financial statements in accordance with GAAP requires
management to make estimates and assumptions that affect the amounts reported in
the financial statements and accompanying notes. Actual results could differ
from those estimates.

INCOME TAXES

    The Company accounts for income taxes using the liability method. Deferred
income taxes result from temporary differences between the carrying amounts of
assets and liabilities for financial reporting purposes and the amounts used for
federal income tax purposes, and are measured using the enacted tax rates and
laws that will be in effect when the differences reverse.

EARNINGS PER SHARE

    The weighted-average common shares outstanding used to calculate diluted
earnings per share for the three and six months ended June 30, 2000 include the
dilutive effect of options to purchase 1,267,180 and 1,242,571 shares of common
stock, respectively. The weighted-average shares outstanding used to calculate
diluted earnings per share for the three and six months ended June 30, 1999
include the dilutive effect of options to purchase 1,420,969 and 1,566,205
shares of common stock, respectively.

RECLASSIFICATIONS

    As a means of addressing the comprehensive real estate service requirements
of its diverse group of clients, the Company realigned certain elements of its
business effective January 1, 2000. Consequently, the three reportable segments
in 1999, Outsourcing, Retail and Local Business Units, have been realigned into
two segments, Corporate and Institutional, in 2000. The Company delivers three
core services--management services, transaction services and development and
project management services--to both corporate and institutional customers.
Revenues for the three and six months ended June 30, 2000 have been

                                       7
<PAGE>
                     TRAMMELL CROW COMPANY AND SUBSIDIARIES

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                 JUNE 30, 2000

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

                                  (UNAUDITED)

1. GENERAL (CONTINUED)
presented by these service lines. Revenues for the three and six months ended
June 30, 1999 have been reclassified to conform to the presentation for 2000. As
a result, 1999 revenue items differ from the amounts reported in previously
filed documents. These reclassifications did not impact net income.

    In addition, in the second quarter of 2000, as the Company increased its
activities in and assigned more dedicated resources to e-Commerce, the Company
began reporting these activities, including related overhead, in a third
reportable segment. Assets at December 31, 1999 have been reclassified to
conform to the presentation in 2000. As a result, 1999 asset items differ from
amounts reported in previously filed documents. These reclassifications did not
impact total assets.

2. REAL ESTATE HELD FOR SALE

    During the six months ended June 30, 2000, the Company sold ten real estate
projects for an aggregate sales price of $46,300, resulting in an aggregate gain
on disposition of $8,472. During the six months ended June 30, 1999, the Company
sold nine real estate projects for an aggregate sales price of $40,139,
resulting in an aggregate gain on disposition of $10,098.

    In addition, during the six months ended June 30, 2000, the Company received
$15,160 from a real estate partnership in which it has a 10% interest,
representing reimbursement of costs expended in excess of the Company's required
capital contribution of $354. In two other transactions, the Company sold its
interest, at net book value, in the partnerships which owned real estate with an
aggregate cost of $16,827 and debt and outstanding payables totaling the same
amount. Under arrangements with lenders, the Company deeded land to lenders with
an aggregate fair market value of $6,108 in two additional transactions.

3. INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES

    Investments in unconsolidated subsidiaries consist of the following:

<TABLE>
<CAPTION>
                                                       JUNE 30,       DECEMBER 31,
                                                         2000             1999
                                                       ---------      -------------
<S>                                                    <C>            <C>
Real estate development..............................   $26,483          $28,759
E-Commerce (See Note 10).............................     6,000            6,000
Other................................................    24,572            2,532
                                                        -------          -------
                                                        $57,055          $37,291
                                                        =======          =======
</TABLE>

    On June 30, 2000, the Company purchased approximately 10.0% of the
outstanding stock of Savills plc ("Savills"), a property services firm
headquartered in the United Kingdom and a leading provider of real estate
services in Europe, Asia-Pacific and Australia, for approximately $21,000. The
investment is classified as an "other" investment in the table above.

                                       8
<PAGE>
                     TRAMMELL CROW COMPANY AND SUBSIDIARIES

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                 JUNE 30, 2000

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

                                  (UNAUDITED)

3. INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES (CONTINUED)
    Operating results for equity method investments included in the above table
are as follows:

<TABLE>
<CAPTION>
                                                      FOR THE SIX MONTHS ENDED
                                                              JUNE 30,
                                                      ------------------------
                                                        2000           1999
                                                      --------      ----------
<S>                                                   <C>           <C>
REAL ESTATE DEVELOPMENT:
Total revenues......................................  $ 20,873       $ 20,916
Total expenses......................................    (9,042)       (15,580)
                                                      --------       --------
  Net income........................................  $ 11,831       $  5,336
                                                      ========       ========
OTHER:
Total revenues......................................  $ 17,925       $ 16,365
Total expenses......................................   (16,442)       (14,671)
                                                      --------       --------
  Net income........................................  $  1,483       $  1,694
                                                      ========       ========
TOTAL:
Total revenues......................................  $ 38,798       $ 37,281
Total expenses......................................   (25,484)       (30,251)
                                                      --------       --------
Net income..........................................  $ 13,314       $  7,030
                                                      ========       ========
</TABLE>

4. ACCRUED EXPENSES

    Accrued expenses consist of the following:

<TABLE>
<CAPTION>
                                                       JUNE 30,       DECEMBER 31,
                                                         2000             1999
                                                       ---------      -------------
<S>                                                    <C>            <C>
Payroll and bonuses..................................   $31,381          $38,387
Commissions..........................................    32,865           36,939
Deferred income......................................     9,455            4,394
Insurance accrual....................................       968              979
Additional consideration for acquisitions............        --            2,000
Other................................................     7,577           10,574
                                                        -------          -------
                                                        $82,246          $93,273
                                                        =======          =======
</TABLE>

                                       9
<PAGE>
                     TRAMMELL CROW COMPANY AND SUBSIDIARIES

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                 JUNE 30, 2000

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

                                  (UNAUDITED)

5. LONG-TERM DEBT

    Long-term debt consists of the following:

<TABLE>
<CAPTION>
                                                       JUNE 30,       DECEMBER 31,
                                                         2000             1999
                                                       ---------      -------------
<S>                                                    <C>            <C>
Borrowings under a $150,000 line of credit with a
  bank...............................................   $72,105          $62,105
Borrowings under a $25,000 line of credit with a
  bank...............................................     4,000               --
Capital lease obligations............................     4,678            1,259
Note payable to entity owned by stockholder..........        --              500
Other................................................        70              220
                                                        -------          -------
Total long-term debt.................................    80,853           64,084
Less current portion of long-term debt...............     2,111            1,443
                                                        -------          -------
                                                        $78,742          $62,641
                                                        =======          =======
</TABLE>

    In March 2000, the Company entered into an agreement with a bank for a
$25,000 short-term revolving line of credit to fund short-term cash requirements
as needed. Loans made under this line of credit bear interest at a rate agreed
upon by the Company and the bank at the time of the loan, generally 30-day LIBOR
plus a margin ranging from 1.25% to 1.75%. Principal is due no more than five
days from the date the loan is made and interest is paid monthly in arrears. All
borrowings must be repaid by December 15, 2000. Amounts outstanding under this
line of credit reduce amounts available under the $150,000 line of credit. No
borrowings were made under this agreement in the first quarter of 2000.

    At June 30, 2000, the Company had an unused borrowing capacity (taking into
account letters of credit outstanding) under its $150,000 line of credit of
approximately $53,597.

6. STOCKHOLDERS' EQUITY

    A summary of the Company's stock option activity for the six months ended
June 30, 2000 is as follows:

<TABLE>
<CAPTION>
                                EXERCISE PRICE   EXERCISE PRICE   EXERCISE PRICE   EXERCISE PRICE
                                   OF $3.85       OF $11.44 TO     OF $17.45 TO     OF $26.64 TO
                                    (BELOW         $17.44 (AT       $26.63 (AT       $36.00 (AT
                                 MARKET PRICE     MARKET PRICE     MARKET PRICE     MARKET PRICE
                                AT GRANT DATE)   AT GRANT DATE)   AT GRANT DATE)   AT GRANT DATE)     TOTAL
                                --------------   --------------   --------------   --------------   ----------
<S>                             <C>              <C>              <C>              <C>              <C>
OPTIONS OUTSTANDING:
December 31, 1999.............     1,739,571          867,622        3,192,638         236,629      6,036,460
Granted.......................            --        1,505,843               --              --      1,505,843
Exercised.....................       (67,748)              --               --              --        (67,748)
Forfeited.....................            --         (112,797)        (200,908)        (12,703)      (326,408)
                                   ---------        ---------        ---------         -------      ---------
June 30, 2000.................     1,671,823        2,260,668        2,991,730         223,926      7,148,147
                                   =========        =========        =========         =======      =========
OPTIONS EXERCISABLE AT JUNE
  30, 2000....................     1,671,823          218,011        1,594,516         123,922      3,608,272
                                   =========        =========        =========         =======      =========
</TABLE>

                                       10
<PAGE>
                     TRAMMELL CROW COMPANY AND SUBSIDIARIES

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                 JUNE 30, 2000

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

                                  (UNAUDITED)

7. ACQUISITION OF REAL ESTATE SERVICE COMPANY

    In July 1999, the Company acquired the business of Phoenix Corporate
Services LLC, a Cambridge, Massachusetts-based commercial real estate
outsourcing services firm, and Leeds Construction Company, Inc., an affiliated
company ("Phoenix"). The Company acquired substantially all of the assets of
Phoenix for a base purchase price of approximately $10,260 ($8,760 of which was
paid in cash at closing and the remainder of which was satisfied by issuing a
$1,500 letter of credit into escrow at closing) and 268,306 shares of common
stock. In addition, the Company agreed to pay up to an additional $2,400 in cash
if the acquired business meets certain performance thresholds. As of June 30,
2000, $1,650 of this amount was earned and paid. The Company also issued 5,619
restricted shares of common stock under the Company's Long-Term Incentive Plan
to an employee of Phoenix who became employed by the Company in connection with
the acquisition, and paid an aggregate of $600 to the two principals and an
employee of Phoenix in exchange for certain covenants not to compete. In
connection with the acquisition, which was accounted for using the purchase
method of accounting, the Company recorded goodwill of $13,107. The operations
of Phoenix are included in the Company's operations from the date of
acquisition. The Company borrowed approximately $10,000 under its credit
facility to fund the acquisition.

8. FINANCIAL INSTRUMENTS

    In September 1998, as required under the Company's $150,000 line of credit,
the Company entered into an interest rate swap to manage market risks related to
changes in interest rates. The Company's participation in derivative
transactions has been designed for hedging purposes, and derivative instruments
are not held or issued for trading purposes. Through June 24, 1999, the Company
had an interest rate swap outstanding with a notional amount of $135,000. This
swap agreement established a fixed interest pay rate of 5.29% on a portion of
the Company's variable rate debt. On June 24, 1999, the interest rate swap
agreement was renewed for a nine-month period ending March 24, 2000, with a
notional amount of $125,000. This swap agreement established a fixed interest
pay rate of 5.52% on a portion of the Company's variable rate debt. On
March 24, 2000, the interest rate swap agreement was renewed for a twelve-month
period ending March 24, 2001, with a notional amount of $150,000. This swap
agreement established a fixed interest pay rate of 6.65% on a portion of the
Company's variable rate debt. Under these swap agreements, if the actual
LIBOR-based rate is less than the specified fixed interest rate, the Company is
obligated to pay the differential interest amount, such amount being recorded as
incremental interest expense. Conversely, if the LIBOR-based rate is greater
than the specified fixed interest rate, the differential interest amount is
refunded to the Company and recorded as a reduction of interest expense. The
weighted average receive rates under these swap agreements were 6.34% and 6.17%
for the three and six months ended June 30, 2000, respectively, and 4.94% and
5.03% for the three and six months ended June 30, 1999, respectively. In
connection with these agreements, the Company recorded incremental interest
expense of $134 for the three months ended June 30, 2000 and a reduction to
interest expense of $14 for the six months ended June 30, 2000 and recorded
incremental interest expense of $124 and $159 for the three and six months ended
June 30, 1999, respectively.

9. COMMITMENTS AND CONTINGENCIES

    At June 30, 2000, the Company had guaranteed $21,714 of real estate notes
payable of others. These notes are collateralized by the underlying real estate.
The Company had outstanding letters of credit totaling $13,848 at June 30, 2000,
which expire at varying dates through June, 2001.

                                       11
<PAGE>
                     TRAMMELL CROW COMPANY AND SUBSIDIARIES

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                 JUNE 30, 2000

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

                                  (UNAUDITED)

9. COMMITMENTS AND CONTINGENCIES (CONTINUED)
    In addition, at June 30, 2000, the Company had several completion and budget
guarantees relating to development projects. Management does not expect to incur
any material losses under these guarantees.

    The Company and its subsidiaries are defendants in lawsuits that arose in
the normal course of business. In management's judgment, the ultimate liability,
if any, from such legal proceedings will not have a material effect on the
Company's financial position.

10. SEGMENT INFORMATION

DESCRIPTION OF SERVICES BY SEGMENT

    To respond to the ever-growing demands of its customers for fully bundled
integrated services, in January 2000, the Company realigned certain elements of
its business resulting in a change from three segments in 1999 to two reportable
segments, Corporate and Institutional. Real estate services are provided within
both segments, but focus on two different types of customers.

    Through the Corporate segment, the Company provides facilities management,
corporate advisory services and project management services to corporate
customers who are typically the primary occupants of commercial properties.
Corporate customers include users of facilities such as multinational
corporations, major retailers, hospitals and universities, as well as other
business concerns.

    Within the Institutional segment, the Company provides property management,
brokerage services and development services to institutional investors in
commercial property, who typically are not the primary occupants of the
facility.

    In the second quarter of 2000, as the Company increased its activities in
and assigned more dedicated resources to e-commerce, the Company began reporting
these activities, including related overhead, in a third segment. The E-Commerce
segment also includes the Company's investments in two companies. One of these
companies offers advanced telecommunications services to building tenants and
the other offers a standardized information distribution network via an Internet
listing site for properties for sale or lease. The E-Commerce segment does not
include investments in ongoing technology advancements internal to the Company's
other two business segments.

MEASUREMENT OF SEGMENT PROFIT OR LOSS AND SEGMENT ASSETS

    The Company evaluates performance and allocates resources among its three
reportable segments based on income before income taxes and EBITDA (as defined
in footnote 2 to the table below). The accounting policies of the reportable
segments are the same as those described in the summary of significant
accounting policies.

FACTORS MANAGEMENT USED TO IDENTIFY THE COMPANY'S REPORTABLE SEGMENTS

    The Company's reportable segments are defined first by the nature of
business transacted, real estate services and e-commerce, and second, by the
type of customer to whom the services are provided. The Corporate and
Institutional segments are managed separately because the expertise required and
the needs of the customer vary between corporate users and institutional
investors. The E-Commerce segment captures distinct new e-commerce business and
investments and has separate management.

                                       12
<PAGE>
                     TRAMMELL CROW COMPANY AND SUBSIDIARIES

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                 JUNE 30, 2000

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

                                  (UNAUDITED)

10. SEGMENT INFORMATION (CONTINUED)
    Virtually all of the Company's revenues are from customers located in the
United States. No individual customer accounts for more than 10% of the
Company's revenues.

    Summarized financial information for the Company's three reportable segments
follows:

<TABLE>
<CAPTION>
                                      THREE MONTHS ENDED     SIX MONTHS ENDED
                                           JUNE 30,              JUNE 30,
                                      -------------------   -------------------
                                        2000     1999(3)      2000     1999(3)
                                      --------   --------   --------   --------
<S>                                   <C>        <C>        <C>        <C>
CORPORATE:
Total revenues......................  $ 81,809   $ 51,452   $149,067   $ 94,800
Costs and expenses(1)...............    74,664     47,015    141,058     89,968
                                      --------   --------   --------   --------
Income before income tax expense....     7,145      4,437      8,009      4,832
Depreciation and amortization.......     2,704      1,306      4,645      2,373
Interest expense....................       996        257      1,633        514
                                      --------   --------   --------   --------
EBITDA(2)...........................  $ 10,845   $  6,000   $ 14,287   $  7,719
                                      ========   ========   ========   ========
INSTITUTIONAL:
Total revenues......................  $104,281   $ 98,284   $200,267   $189,725
Costs and expenses(1)...............    96,889     88,898    187,570    168,822
                                      --------   --------   --------   --------
Income before income tax expense....     7,392      9,386     12,697     20,903
Depreciation and amortization.......     3,647      2,816      6,372      5,394
Interest expense....................     3,247      1,697      6,111      3,404
                                      --------   --------   --------   --------
EBITDA(2)...........................  $ 14,286   $ 13,899   $ 25,180   $ 29,701
                                      ========   ========   ========   ========
E-COMMERCE:
Total revenues......................  $     55   $     --   $     55   $     --
Costs and expenses(1)...............       602         --        602         --
                                      --------   --------   --------   --------
Income before income tax expense
  (benefit).........................      (547)        --       (547)        --
Depreciation and amortization.......        --         --         --         --
Interest expense....................        --         --         --         --
                                      --------   --------   --------   --------
EBITDA(2)...........................  $   (547)  $     --   $   (547)  $     --
                                      ========   ========   ========   ========
</TABLE>

                                       13
<PAGE>
                     TRAMMELL CROW COMPANY AND SUBSIDIARIES

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                 JUNE 30, 2000

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

                                  (UNAUDITED)

10. SEGMENT INFORMATION (CONTINUED)

<TABLE>
<CAPTION>
                                      THREE MONTHS ENDED     SIX MONTHS ENDED
                                           JUNE 30,              JUNE 30,
                                      -------------------   -------------------
                                        2000     1999(3)      2000     1999(3)
                                      --------   --------   --------   --------
<S>                                   <C>        <C>        <C>        <C>
TOTAL:
Total revenues......................  $186,145   $149,736   $349,389   $284,525
Costs and expenses(1)...............   172,155    135,913    329,230    258,790
                                      --------   --------   --------   --------
Income before income tax expense....    13,990     13,823     20,159     25,735
Depreciation and amortization.......     6,351      4,122     11,017      7,767
Interest expense....................     4,243      1,954      7,744      3,918
                                      --------   --------   --------   --------
EBITDA(2)...........................  $ 24,584   $ 19,899   $ 38,920   $ 37,420
                                      ========   ========   ========   ========
</TABLE>

<TABLE>
<CAPTION>
                                                    JUNE 30,       DECEMBER 31,
                                                      2000            1999(3)
                                                    ---------      -------------
<S>                                                 <C>            <C>
TOTAL ASSETS:
Corporate.........................................  $198,940         $179,091
Institutional.....................................   438,191          452,919
E-Commerce........................................     6,055            6,000
                                                    --------         --------
Total assets for reportable segments..............   643,186          638,010
Other assets......................................    21,117               --
                                                    --------         --------
Total consolidated assets.........................  $664,303         $638,010
                                                    ========         ========
</TABLE>

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

(1) Costs and expenses for the three and six months ended June 30, 2000 include
    non-cash compensation expense of $751 and $1,149 related to the Corporate
    segment and $568 and $1,100 related to the Institutional segment,
    respectively. Costs and expenses for the three and six months ended
    June 30, 1999 include non-cash compensation expense of $203 and $344 related
    to the Corporate segment and $593 and $1,027 related to the Institutional
    segment, respectively. Through June 30, 2000, there had been no non-cash
    compensation expense related to the E-Commerce segment.

(2) EBITDA represents earnings before interest, income taxes and depreciation
    and amortization. Management believes that EBITDA can be a meaningful
    measure of the Company's operating performance, cash generation and ability
    to service debt. However, EBITDA should not be considered as an alternative
    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.

(3) The 1999 segment information has been reclassified to conform with the
    presentation of 2000 segment information to reflect the changes in the
    Company's reportable segments effective January 1, 2000 and the addition of
    the E-Commerce segment in the second quarter of 2000.

                                       14
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
  OF OPERATIONS

    The following discussion should be read in conjunction with the Company's
unaudited Consolidated Financial Statements and the notes thereto included in
Item 1 of this Quarterly Report on Form 10-Q.

OVERVIEW

    Trammell Crow Company is one of the largest diversified commercial real
estate service firms in North America. As a means of addressing the
comprehensive real estate service requirements of its diverse group of clients,
the Company realigned certain elements of its business effective January 1,
2000. Consequently, the three reportable segments in 1999, Outsourcing, Retail
and Local Business Units, were realigned into two segments, Corporate and
Institutional, in 2000 to respond to the ever-growing demands of the Company's
customers for fully bundled integrated services. The Company delivers three core
services--management services, transaction services and development and project
management services--to both corporate and institutional customers. In the
second quarter of 2000, as the Company increased its activities in and assigned
more dedicated resources to e-commerce, the Company began reporting these
activities, including related overhead, in a third segment.

    Through its Corporate segment, the Company provides services to users of
space who are typically the primary occupants of commercial properties and
include multinational corporations, hospitals and universities. As part of the
realignment, the Company consolidated all pieces of its business focused on
corporate customers, including major retailers. Thus, tenant representation and
build-to-suit services for corporate and retail customers are part of the
Company's integrated corporate services offering. The management services
provided under the Corporate segment consist primarily of facilities management,
which entails providing comprehensive day-to-day occupancy related services,
principally to large corporations that occupy commercial facilities in multiple
locations. These services include administration and day-to-day maintenance and
repair of client-occupied facilities. Transaction services provided by the
Corporate segment include corporate advisory services such as portfolio
management and tenant representation. Project management services provided by
the Corporate segment include strategic functions such as space planning and
relocation coordination, build-to-suit development and financial services.

    Within its Institutional segment, the Company provides services to investors
and landlords who typically are not the primary occupants of the commercial
properties with respect to which services are performed. Management services
provided by the Institutional segment include property management services
relating to all aspects of building operations, tenant relations and oversight
of building improvement processes. Transaction services provided by the
Institutional segment include brokerage services such as project leasing and
investment sales whereby the Company advises buyers, sellers and landlords in
connection with the sale and leasing of office, industrial and retail space and
land. Development services provided by the Institutional segment include
comprehensive project development and construction services and the acquisition
and disposition of commercial real estate projects. The development services
provided include financial planning, site acquisition, procurement of approvals
and permits, design and engineering coordination, construction bidding and
management and tenant finish coordination, project close-out and user move
coordination, general contracting and project finance advisory services.

    The Company's activities related to e-commerce, including related overhead,
are captured in the E-Commerce segment. The E-Commerce segment also includes the
Company's investments in two companies. One of these companies offers advanced
telecommunications services to building tenants and the other offers a
standardized information distribution network via an Internet listing site for
properties for sale or lease. The E-Commerce segment may transact business with
the Corporate and Institutional segments, but it does not include investments in
ongoing technology advancements internal to the Company's other two business
segments.

                                       15
<PAGE>
RESULTS OF OPERATIONS-THREE AND SIX MONTHS ENDED JUNE 30, 2000 COMPARED TO THREE
  AND SIX MONTHS ENDED JUNE 30, 1999

    REVENUES.  The Company's total revenues increased $36.4 million, or 24.3%,
to $186.1 million for the three months ended June 30, 2000 and increased
$64.9 million, or 22.8%, to $349.4 million for the six months ended June 30,
1999 from the comparable periods in the prior year.

CORPORATE REVENUES

    Facilities management revenue, which represented 16.8% and 17.4% of the
Company's total revenue for the three and six months ended June 30, 2000,
respectively, increased $9.7 million, or 44.9%, to $31.3 million for the three
months ended June 30, 2000 and increased $20.9 million, or 52.5%, to
$60.7 million for the six months ended June 30, 2000 from comparable periods in
the prior year. The revenue growth for the three months ended June 30, 2000 is
primarily attributable to the acquisition of a real estate outsourcing services
firm in July 1999. The revenue growth for the six months ended June 30, 2000
primarily resulted from (i) the acquisition of a real estate outsourcing
services firm in July 1999, (ii) the addition of several new customers
subsequent to the second quarter of 1999, and (iii) the expansion of services
provided to existing customers.

    Corporate advisory services revenue, which represented 20.6% and 18.5% of
the Company's total revenue for the three and six months ended June 30, 2000,
respectively, increased $15.0 million, or 64.1%, to $38.4 million for the three
months ended June 30, 2000 and increased $21.4 million, or 49.7%, to
$64.5 million for the six months ended June 30, 2000 from the comparable periods
in the prior year. The revenue growth resulted from an increase in the number of
brokerage transactions, fueled by an increase in the average number of brokers
employed during the first and second quarters of 2000, as compared to the first
and second quarters of 1999, coupled with an increased focus on larger
transactions.

    Revenues from project management activities (consisting of project
management service fees and gain/loss on disposition of real estate) totaled
$12.0 million and $23.7 million for the three and six months ended June 30,
2000, respectively, and represented 6.4% and 6.8% of the Company's total revenue
for the three and six months ended June 30, 2000, respectively. These revenues
increased $5.6 million, or 87.5%, from $6.4 million for the three months ended
June 30, 2000 and increased $11.9 million, or 100.8%, from $11.8 million for the
six months ended June 30, 2000 from the comparable periods in the prior year.
The revenue growth for the three and six months ended June 30, 2000 was due to
the acquisition of a real estate outsourcing services firm in July 1999, the
addition of several new projects on which the Company receives development,
construction management and general contractor fees and the expansion of
services provided to existing customers.

INSTITUTIONAL REVENUES

    Property management revenue, which represented 21.3% and 22.8% of the
Company's total revenue for the three and six months ended June 30, 2000,
respectively, increased $2.6 million, or 7.0%, to $39.6 million for the three
months ended June 30, 2000 and increased $5.0 million, or 6.7%, to
$79.5 million for the six months ended June 30, 2000 from the comparable periods
in the prior year. The increase for the three and six months ended June 30, 2000
was primarily due to increases from comparable periods in the prior year in the
total number of square feet under management and in the percentage of managed
space represented by office product which generates higher property management
revenues per square foot than other product types.

    Brokerage services revenue, which represented 21.2% and 19.8% of the
Company's total revenue for the three and six months ended June 30, 2000,
respectively, increased $7.4 million, or 23.1%, to $39.5 million for the three
months ended June 30, 2000 and increased $10.6 million, or 18.1%, to
$69.3 million for the six months ended June 30, 2000 from the comparable periods
in the prior year. The revenue growth for the three and six months ended
June 30, 2000 resulted from an increase in the number

                                       16
<PAGE>
of brokerage transactions, fueled by an increase in the average number of
brokers employed during the first and second quarters of 2000, as compared to
the first and second quarters of 1999, coupled with an increased focus on larger
transactions.

    Revenues from development and investment activities (consisting of
development services fees, income from investments in unconsolidated
subsidiaries and gain on disposition of real estate) totaled $24.4 million and
$50.5 million for the three and six months ended June 30, 2000, respectively,
and represented 13.1% and 14.5% of the Company's total revenue for the three and
six months ended June 30, 2000, respectively. These revenues decreased
$4.2 million, or 14.7%, from $28.6 million in 1999, for the three months ended
June 30, 2000 and decreased $5.1 million, or 9.2%, from $55.6 million in 1999,
for the six months ended June 30, 2000. The decrease in revenue for the three
months ended June 30, 2000 is primarily attributable to a decrease of
$6.4 million in gain on disposition of real estate and a $1.2 million decrease
in income from investments in unconsolidated subsidiaries, offset by a
$3.2 million increase in development services revenues. The decrease in gain on
disposition of real estate for the three months ended June 30, 2000 is primarily
attributable to a decrease in the number of dispositions and a decrease in the
profits generated from such transactions in 2000. The decrease in revenue for
the six months ended June 30, 2000 is primarily attributable to a decrease of
$3.5 million in development services revenues and a decrease of $1.8 million in
gain on disposition of real estate. In the six months ended June 30, 2000, the
Company generated development fees of $2.2 million for its two largest projects,
compared to development fees of $9.0 million from the two largest projects in
1999; however, the decrease in development fees was offset by a $2.9 million
increase in revenues generated from operational properties (included in
development services revenues) over the comparable period in 1999.

    The Company provides development services to both corporate and
institutional customers. The Company's corporate development activity continues
to grow in the form of corporate build-to-suits and fee development services.
Some of the Company's development resources focus on providing development
services to institutional clients that invest in speculative commercial real
estate projects. During the last half of 1999 and the first half of 2000, the
Company has become more cautious in developing speculative real estate. The
caution reflects the Company's belief that demand for new product in many of the
markets in which the Company operates may be declining. The Company has also
observed evidence that providers of capital for real estate investment are
taking a more measured approach to investments in speculative development
projects. The Company expects that these trends, together with increases in
interest rates during 1999 and thus far in 2000, will cause the Company's
development and investment revenues and profits in 2000 to be relatively
consistent with 1999 levels.

    COSTS AND EXPENSES.  The Company's costs and expenses increased
$36.3 million, or 26.7%, to $172.2 million for the three months ended June 30,
2000 and $70.4 million, or 27.2%, to $329.2 million for the six months ended
June 30, 2000 from the comparable periods in the prior year.

    The increase in costs and expenses was largely due to a 22.6% and 23.7%
increase in salaries, wages, and benefits for the three and six months ended
June 30, 2000, respectively, from the comparable periods in the prior year. The
increase resulted primarily from increases in staffing to support internal
growth in the Company's business, including new assignments for the Company's
corporate outsourcing business, and the acquisition of a real estate outsourcing
firm in July 1999.

    Commissions increased $9.3 million, or 43.1%, to $30.9 million, for the
three months ended June 30, 2000 and $14.6 million, or 38.7%, to $52.3 million
for the six months ended June 30, 2000 from the comparable periods in the prior
year. The change is primarily a result of the increased brokerage activities
that resulted in the significant growth in the Company's corporate advisory and
investment sales transactions, which command higher commission payouts to
brokers than project leasing.

    General and administrative expenses increased $3.2 million, or 12.7% to
$28.3 million for the three months ended June 30, 2000 and $8.4 million, or
18.5%, to $53.8 million for the six months ended June 30, 2000 from comparable
periods in the prior year. The increase is primarily due to a company-wide
increase

                                       17
<PAGE>
in administrative costs resulting from the overall increase in number of
employees (approximately 5,700 at June 30, 1999 and approximately 6,900 at
June 30, 2000) and, to a lesser extent, an increase in management information
systems costs.

    Other expenses (consisting of depreciation, amortization, interest and
minority interest) increased $5.2 million, or 70.2%, to $12.6 million, for the
three months ended June 30, 2000 and $8.8 million, or 67.2%, to $21.9 million
for the six months ended June 30, 2000 from comparable periods in the prior
year. The increase in other expenses is primarily related to an increase in
depreciation and amortization of $2.3 million and $3.2 million for the three and
six months ended June 30, 2000, respectively, and an increase in interest
expense of $2.2 million and $3.8 million for the three and six months ended
June 30, 2000, respectively. The increase in depreciation and amortization is
primarily related to depreciation expense related to information systems and
amortization related to the July 1999 acquisition. The increase in interest
expense is primarily attributable to an increase in interest expense related to
real estate held for sale properties that have become operational and increased
interest expense related to the Company's revolving line of credit resulting
from higher interest rates.

    INCOME BEFORE INCOME TAXES.  The Company's income before income taxes
increased $0.2 million, or 1.4%, to $14.0 million for the three months ended
June 30, 2000 and decreased $5.5 million, or 21.4%, to $20.2 million for the six
months ended June 30, 2000 from the comparable prior year periods. The decrease
for the six months ended June 30, 2000 is attributable to a change in the
composition of development and transaction services revenue and an increase in
salaries, wages and benefits. In the first quarter of 1999, the Company's
development services revenues included two large transactions as previously
noted that contributed significantly to net income before taxes. The Company did
not have comparable transactions in the first half of 2000. As compared to 1999,
the Company derived more of its transaction services revenue in the first and
second quarters of 2000 from tenant representation and investment sales
transactions which command a higher commission payout to brokers than project
leasing. The Company believes that the current quarter results are not
indicative of full year results due to changes in revenue composition from
quarter to quarter and expects income before income taxes for the full year, as
a percentage of revenues, to be relatively consistent with 1999 results.

    NET INCOME.  Net income increased $0.1 million, to $8.4 million for the
three months ended June 30, 2000 as compared to the same period in the prior
year, and decreased $3.3 million, to $12.1 million for the six months ended
June 30, 2000 for the same period in the prior year, due to the fluctuations in
revenues and expenses described above.

QUARTERLY RESULTS OF OPERATIONS AND SEASONALITY

    The results of operations for any quarter are not necessarily indicative of
results for any future period. The Company's revenues and operating margins tend
to be higher in the last quarter of the year than in the first three quarters
because its clients have demonstrated a tendency to close transactions toward
the end of the year. The timing and introduction of new contracts, the
disposition of investments in real estate assets and other factors may also
cause quarterly fluctuations in the Company's results of operations.

LIQUIDITY AND CAPITAL RESOURCES

    The Company's liquidity and capital resources requirements include the
funding of working capital needs, primarily accounts receivable from its
clients; the funding of capital investments, including investments in or the
acquisition of e-commerce or real estate service companies; expenditures for
real estate held for sale and payments on notes payable associated with its real
estate development and investment activities; e-commerce related investments;
and expenditures related to upgrading the Company's management information
systems. The Company finances its operations with internally generated funds and
borrowings under the Credit Facility (described below). The Company's real
estate development and

                                       18
<PAGE>
investment business is financed with loans secured by underlying real estate,
external equity, internal sources of funds, or a combination thereof.

    Net cash used in operating activities totaled $2.6 million for the six
months ended June 30, 2000, compared to net cash used of $11.6 million for the
same period in 1999. The change is due to a decrease in net cash used for
development activity (changes in real estate held for sale, net of related
borrowings) to $2.1 million in 2000 compared to $5.8 million used in 1999. In
addition, cash used in operations decreased from $5.7 million in 1999 to
$0.5 million in 2000.

    Net cash used in investing activities totaled $28.7 million for the six
months ended June 30, 2000, compared to net cash used in investing activities of
$9.7 million for the same period in 1999. This change is primarily due to an
increase of $17.1 million in investments in unconsolidated subsidiaries, net of
distributions, and an increase of $0.9 million in expenditures for furniture and
equipment in 2000. The majority of the net increase in investments in
unconsolidated subsidiaries relates to the Company's investment in Savills plc.

    Net cash provided by financing activities totaled $13.4 million for the six
months ended June 30, 2000, compared to net cash used in financing activities of
$19.0 million for the same period in 1999. This change is primarily attributable
to borrowings, net of payments, in 2000 of $16.8 million under the Credit
Facility (described below), compared to net payments of $30.9 million in 1999.
In addition, the Company made distributions to minority interest holders, net of
contributions, of $4.5 million in 2000, compared to contributions from minority
interest holders, net of distributions, of $6.9 million in 1999. The Company
also received $4.2 million in 1999 from the exercise of stock options and
issuance of common stock, compared to $1.6 million from issuance of common stock
in 2000.

    The Company has a $150 million revolving line of credit arranged by Bank of
America, N.A., as the administrative agent (the "Administrative Agent"). In
December 1999, the Company, under the terms of the revolving line of credit,
exercised the first of its two one-year extension options and subsequently
amended the revolving line of credit (the "Credit Facility"). Under the terms of
the Credit Facility, the Company can obtain loans which are Base Rate Loans or
Eurodollar Rate Loans. Base Rate Loans bear interest at a base rate, which is
the higher of the prime lending rate announced from time-to-time by the
Administrative Agent or an average federal funds rate plus 0.5%. Eurodollar Rate
Loans bear interest at an adjusted Eurodollar rate plus a margin which ranges
from 1.25% to 1.75%, depending upon the Company's leverage ratio at the date the
margin is determined. The Credit Facility contains various covenants such as the
maintenance of minimum equity and liquidity and covenants relating to certain
key financial data. The Credit Facility also includes limitations on payment of
cash dividends or other distributions of assets and certain restrictions on
investments and acquisitions that can be made by the Company. The covenants
contained in the Credit Facility and the amount of the Company's other
borrowings and contingent liabilities may have the effect of limiting the credit
available to the Company under the Credit Facility to an amount less than the
$150 million commitment. At June 30, 2000, the Company had outstanding
borrowings of $72.1 million and unused borrowing capacity (taking into account
letters of credit outstanding) under the Credit Facility of approximately
$53.9 million. The Credit Facility requires the Company to enter into one or
more interest rate agreements for the Company's indebtedness in excess of
$50 million ensuring the net interest is fixed, capped or hedged. In
September 1998, the Company entered into an interest rate swap agreement with a
notional amount of $135.0 million. The swap agreement established a fixed
interest pay rate of 5.29% and expired on June 24, 1999. In June 1999, the
Company entered into a second swap agreement with a notional amount of
$125.0 million and a fixed interest pay rate of 5.52%. This agreement expired on
March 24, 2000. On March 24, 2000, the Company entered into a new swap agreement
that expires on March 24, 2001 with a notional amount of $150.0 million and a
fixed interest pay rate of 6.65%. The weighted average receive rate for the swap
agreement was 6.17% for the six months ended June 30, 2000. The Company's
participation in derivative transactions has been designed for hedging purposes,
and derivative instruments are not held for trading purposes. The shares of
certain subsidiaries of the Company, individually representing 5% or more of the
consolidated

                                       19
<PAGE>
assets, revenues or earnings of the Company, are pledged as security for the
Credit Facility. The Company expects to continue to borrow under the Credit
Facility to finance future strategic acquisitions and investments, fund its
co-investment activities with its customers and provide the Company with an
additional source of working capital.

    In August 1997, Trammell Crow BTS, Inc., a wholly-owned subsidiary of the
Company ("TC BTS"), obtained a $20.0 million credit facility (the "Retail BTS
Facility") from KeyBank National Association ("KeyBank"). In September 1999, the
Retail BTS Facility was modified to increase the credit facility to
$30.0 million. In May 2000, the Retail BTS Facility was modified to extend the
date to July 31, 2001, by which subsidiaries of TC BTS can obtain loans at one
of a LIBOR-based interest rate, KeyBank's prime rate or a combination of the two
interest rates. The proceeds of any such loans must be used for the construction
of retail facilities. On June 30, 2000, the outstanding balance owed under the
Retail BTS Facility was $4.7 million. The Retail BTS facility is secured by a
first mortgage on and assignment of all rents from the constructed facilities.
In addition, TC BTS must guarantee all obligations of its subsidiaries for loans
made pursuant to the Retail BTS Facility. The Company must also guarantee the
repayment obligations under the Retail BTS Facility with respect to such loans
and must guarantee the timely lien-free completion of each retail facility to
which such loans relate. As guarantor, the Company is subject to various
covenants consistent with financial covenants required by the Credit Facility.
The Retail BTS Facility also contains various covenants, such as the maintenance
of a minimum net worth and liquidity of TC BTS and prohibition on other TC BTS
guarantees of build-to-suit retail projects.

    In December 1998, TCC NNN Trading, Inc., a wholly-owned subsidiary of the
Company ("TCC Triple Net"), obtained a two-year $20.0 million revolving line of
credit (the "Triple Net Facility") from KeyBank. Under the terms of the Triple
Net Facility, TCC Triple Net can obtain loans at a LIBOR-based interest rate or
prime rate, the proceeds of which must be used for the acquisition of retail
properties subject to "triple net" leases. On June 30, 2000, there was no
outstanding balance under the Triple Net Facility. The Triple Net Facility is
nonrecourse to TCC Triple Net and is secured by a first mortgage and assignment
of all rents from the acquired properties. The Company will guarantee from 10%
to 40% of each such loan depending on the credit rating of the tenant occupying
the acquired property. The Company's guarantee percentage will be reduced to 10%
for any loan upon the receipt of a qualifying purchase agreement relating to the
property underlying such loan. The maximum amount of any advance related to a
single property will be either (i) 90% of the property's acquisition costs and
certain related costs (if the property's tenant has a debt rating of BBB or
higher), or (ii) 80% of the property's acquisition costs and certain related
costs (if the property's tenant has a debt rating of BB+ or lower). The Triple
Net Facility also contains various covenants, such as the maintenance of minimum
equity and liquidity of the Company and covenants relating to certain key
financial data of the Company. The restrictions contained in such financial
covenants are identical to those set forth in the Credit Facility.

    The Company intends to retain earnings to finance its growth and, therefore,
does not anticipate paying any dividends in the foreseeable future. The Company
believes that funds generated from operations, together with existing cash and
available credit under the Credit Facility, the Retail BTS Facility and the
Triple Net Facility and loans secured by underlying real estate will be
sufficient to finance its current operations, planned capital expenditure
requirements, payment obligations for development purchases, investments in
and/or acquisitions of e-commerce and real estate service companies and internal
growth for the foreseeable future. The Company's need, if any, to raise
additional funds to meet its working capital and capital requirements will
depend upon numerous factors, including the success and pace of its
implementation of its growth strategy and related initiatives. The Company
regularly considers capital raising alternatives to be able to take advantage of
available avenues to supplement its working capital, including strategic
corporate partnerships or other alliances, bank borrowings and the sale of
equity and/or debt securities.

                                       20
<PAGE>
FORWARD-LOOKING STATEMENTS

    Certain statements contained or incorporated by reference in this Quarterly
Report on Form 10-Q, including without limitation statements containing the
words "believes," "anticipates," "expects", "envisions", "projects" and words of
similar import, are forward-looking statements within the meaning of the federal
securities laws. Such forward-looking statements involve known and unknown
risks, uncertainties and other matters which may cause the actual results,
performance or achievements of the Company or industry results to be materially
different from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such risks, uncertainties and other
matters include, but are not limited to (i) the timing of individual
transactions, (ii) the ability of the Company to implement cost containment
measures and achieve economies of scale, (iii) the ability of the Company to
implement and manage effectively its e-commerce initiatives, (iv) the ability of
the Company to compete effectively in the international arena, (v) the ability
of the Company to attract new outsourcing customers, (vi) the ability of the
Company to manage fluctuations in net earnings and cash flow which could result
from the Company's participation as a principal in real estate investments,
(vii) the Company's ability to continue to pursue an aggressive growth strategy,
(viii) the Company's ability to compete in highly competitive national and local
business lines and (ix) the Company's ability to attract and retain qualified
personnel in all areas of its business (particularly management). In addition,
the Company's ability to achieve certain anticipated results will be subject to
other factors affecting the Company's business that are beyond the Company's
control, including but not limited to general economic conditions (including the
cost and availability of capital for investment in real estate) and the effect
of government regulation on the conduct of the Company's business. Given these
uncertainties, readers are cautioned not to place undue reliance on such
forward-looking statements. The Company disclaims any obligation to update any
such statements or publicly announce any updates or revisions to any of the
forward-looking statements contained herein to reflect any change in the
Company's expectation with regard thereto or any change in events, conditions,
circumstances or assumptions underlying such statements. Reference is hereby
made to disclosures contained under heading "Risk Factors" in "Item 1. Business"
of the Company's Annual Report on Form 10-K filed with the Securities and
Exchange Commission on March 29, 2000.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

    The Company considered the provision of Financial Reporting Release No. 48
"Disclosure of Accounting Policies for Derivative Financial Instruments and
Derivative Commodity Instruments, and Disclosure of Quantitative and Qualitative
Information about Market Risk Inherent in Derivative Financial Instruments,
Other Financial Instruments and Derivative Commodity Instruments." A review of
the Company's financial instruments, such as its variable rate debt and interest
rate swap, revealed that the Company has exposure to interest rate risk. The
Company utilized sensitivity analyses to assess the potential effect of this
risk and concluded that near-term changes in interest rates should not
materially adversely affect the Company's financial position, results of
operations or cash flows.

PART II-OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

    From time to time, the Company is involved in litigation incidental to its
business. In the Company's opinion, no litigation to which the Company is
currently a party, if decided adversely to the Company, is likely to have a
material adverse effect on the Company's results of operations, cash flows or
financial condition.

                                       21
<PAGE>
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

    At the Annual Meeting of Stockholders held on May 16, 2000, the following
items were presented to stockholders with the following results:

    1.  To elect the individuals named below to serve as Class III Directors for
       Trammell Crow Company until its Annual Meeting of stockholders in 2003 or
       until their respective successors are elected and qualified or until
       their earlier death, resignation or removal from office.

<TABLE>
<CAPTION>
                                                                    FOR       WITHHELD
                                                                 ----------   --------
        <S>                                                      <C>          <C>
        J. McDonald Williams...................................  26,738,172   465,387
        William F. Concannon...................................  26,734,517   469,042
        Henry J. Faison........................................  26,734,084   469,475
</TABLE>

       The following individuals are Class I Directors of Trammell Crow Company,
       whose terms expire at the Company's Annual Meeting of Stockholders in
       2001: George L. Lippe, Rowland T. Moriarty and Robert E. Sulentic. The
       following individuals are Class II Directors of Trammell Crow Company,
       whose terms expire at the Company's Annual Meeting of Stockholders in
       2002: James R. Erwin, Harlan R. Crow and Jeffrey M. Heller.

    2.  To ratify the selection of Ernst & Young LLP as independent accountants
       of the Company for the fiscal year ended December 31, 2000.

<TABLE>
<CAPTION>
                                                                      NUMBER OF SHARES
                                                                      ----------------
        <S>                                                           <C>
        For.........................................................     26,997,413
        Against.....................................................        103,096
        Abstain.....................................................        103,050
</TABLE>

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

       (a) Exhibits:

<TABLE>
            <S>      <C>
            3.2.1    First Amendment to Bylaws of the Company

            10.12.8  Eighth Modification to Master Construction Loan Agreement
                     dated August 4, 1997, between Trammell Crow BTS, Inc. and
                     KeyBank National Association--May 10, 2000.

            10.12.9  Ninth Modification to Master Construction Loan Agreement
                     dated August 4, 1997, between Trammell Crow BTS, Inc. and
                     KeyBank National Association -- June 27, 2000.

            27       Financial Data Schedule
</TABLE>

       (b) Reports on Form 8-K filed since March 31, 2000:

       None

                                       22
<PAGE>
                                   SIGNATURE

    Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

<TABLE>
<S>                                                    <C>  <C>
                                                       TRAMMELL CROW COMPANY

                                                       By:            /s/ ROBERT E. SULENTIC
                                                            -----------------------------------------
                                                                        Robert E. Sulentic
                                                            EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL
                                                            OFFICER AND DIRECTOR (PRINCIPAL FINANCIAL
                                                             OFFICER AND DULY AUTHORIZED TO SIGN THIS
                                                               REPORT ON BEHALF OF THE REGISTRANT)
</TABLE>

Date: August 11, 2000

                                       23