UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

|Maryland                                                       | #36-4246655                            
|-------------------------------------------------------------- | ---------------------------------------
|(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number)



2901 Butterfield Road, Oak Brook, Illinois       60523
(Address of principal executive office)          (Zip code)

Registrant's telephone number, including area code: 630-218-8000

N/A
(Former name, former address and former fiscal
year, if changed since last report)

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

As of August 11, 2000, there were 8,997,119 Shares of Common Stock outstanding.





PART I - Financial Information

Item 1. Consolidated Financial Statements



INLAND RETAIL REAL ESTATE TRUST, INC.

|                                                                                                                                         | June           | December     
|---------------------------------------------------------------------------------------------------------------------------------------- | -------------- | -------------
|                                                                                                                                         | 2000           | 1999         
|Investment Properties:                                                                                                                   |                |              
|Land                                                                                                                                     | $   40,284,916 | $  33,260,261
|Building and site improvements                                                                                                           | 129,664,183    | 93,978,854   
|                                                                                                                                         | 169,949,099    | 127,223,115  
|Less accumulated depreciation                                                                                                            | 3,249,291      | 1,229,323    
|Net investments in properties                                                                                                            | 166,699,808    | 126,009,792  
|                                                                                                                                         |                |              
|Cash and cash equivalents                                                                                                                | 11,111,316     | 14,869,164   
|Restricted cash (Note 1)                                                                                                                 | 1,287,467      | 1,246,889    
|Accounts and rents receivable, (net of allowance   of $100,000 and $0 as of June 30, 2000 and   December 31, 1999, respectively)(Note 6) | 1,857,343      | 1,331,213    
|Real estate tax and insurance escrow deposits                                                                                            | 365,241        | 227,123      
|Loan fees (net of accumulated amortization of                                                                                            |                |              
|$84,838 and $20,432 as of June 30, 2000 and                                                                                              |                |              
|December 31, 1999, respectively)                                                                                                         | 356,127        | 164,433      
|Leasing fees (net of accumulated amortization of   $9,287 and $3,346 as of June 30, 2000 and   December 31, 1999, respectively)          | 23,665         | 34,106       
|Deferred acquisition costs                                                                                                               | 387,907        | 91,880       
|Other assets                                                                                                                             | 127,343        | 13,536       
|Total assets                                                                                                                             | $ 182,216,217  | $ 143,988,136





INLAND RETAIL REAL ESTATE TRUST, INC.

(continued)
June 30, 2000 and December 31, 1999
(unaudited)
Liabilities and Stockholders' Equity



|                                                                                                                                                                         | June          | December     
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------- | -------------
|                                                                                                                                                                         | 2000          | 1999         
|Liabilities:                                                                                                                                                             |               |              
|Accounts payable                                                                                                                                                         | $     172,142 | $      74,094
|Accrued offering costs due to Affiliates                                                                                                                                 | 1,651,114     | 1,309,642    
|Accrued offering costs due to non-affiliates                                                                                                                             | 47,740        | 1,554,262    
|Accrued interest payable to non-affiliates                                                                                                                               | 581,961       | 419,003      
|Real estate tax payable                                                                                                                                                  | 937,663       | --           
|Distributions payable (Note 11)                                                                                                                                          | 493,641       | 331,467      
|Security Deposits                                                                                                                                                        | 303,894       | 232,370      
|Mortgages payable (Note 7)                                                                                                                                               | 108,030,099   | 93,099,852   
|Unearned income                                                                                                                                                          | 133,084       | 9,585        
|Other liabilities                                                                                                                                                        | 1,428,196     | 1,359,209    
|Due to Affiliates (Note 3)                                                                                                                                               | 1,313,925     | 582,787      
|                                                                                                                                                                         |               |              
|Total liabilities                                                                                                                                                        | 115,093,459   | 98,972,271   
|                                                                                                                                                                         |               |              
|Minority interest in partnership                                                                                                                                         | 2,000         | 2,000        
|                                                                                                                                                                         |               |              
|Stockholders' Equity:                                                                                                                                                    |               |              
|Preferred Stock, $.01 par value, 10,000,000   shares authorized, none outstanding                                                                                        | --            | --           
|Common Stock, $.01 par value, 100,000,000   shares authorized, 8,211,172 and   5,433,839 issued and outstanding at June   30, 2000 and December 31, 1999,   respectively | 82,112        | 54,338       
|                                                                                                                                                                         |               |              
|Additional paid-in capital (net of costs of                                                                                                                              |               |              
|Offering of $11,723,288 and $8,057,059 at   June 30, 2000 and December 31, 1999,   respectively, of which $7,888,057 and   $5,193,155 was paid to Affiliates,            |               |              
|respectively)                                                                                                                                                            | 70,266,573    | 46,188,392   
|Accumulated distributions in excess of                                                                                                                                   |               |              
|Net income                                                                                                                                                               | (3,227,927)   | (1,228,865)  
|                                                                                                                                                                         |               |              
|Total stockholders' equity                                                                                                                                               | 67,120,758    | 45,013,865   
|                                                                                                                                                                         |               |              
|Commitments and contingencies (Notes 5,6 and   10)                                                                                                                       |               |              
|                                                                                                                                                                         |               |              
|Total liabilities and stockholders' equity                                                                                                                               | $ 182,216,217 | $ 143,988,136
|                                                                                                                                                                         |               |              

See accompanying notes to consolidated financial statements.

INLAND RETAIL REAL ESTATE TRUST, INC.

Consolidated Statements of Operations

For the Three and Six Months Ended June 30,2000 and 1999

(unaudited)



|                                                                            | Three months  | Three months  | Six months    | Six months   
|--------------------------------------------------------------------------- | ------------- | ------------- | ------------- | -------------
|                                                                            | ended         | ended         | ended         | ended        
|                                                                            | June 30, 2000 | June 30, 1999 | June 30, 2000 | June 30, 1999
|                                                                            |               |               |               |              
|Income:                                                                     |               |               |               |              
|Rental income                                                               | 3,783,503     | 379,788       | 7,258,694     | 379,788      
|Additional rental income                                                    | 567,468       | 226,698       | 1,902,846     | 226,698      
|Interest income                                                             | 146,873       | 35,592        | 347,823       | 35,592       
|Other income                                                                | 14,035        | -             | 17,634        | -            
|                                                                            |               |               |               |              
|                                                                            | 4,511,879     | 642,078       | 9,526,697     | 642,078      
|Expenses:                                                                   |               |               |               |              
|Professional services toAffiliates                                          | -             | 10,242        | -             | 10,242       
|Professional services to non-  affiliates                                   | 52,030        | 29,033        | 132,755       | 29,033       
|General and administrative   expenses to Affiliates                         | 48,535        | 40,186        | 109,018       | 40,186       
|General and administrative   expenses to non-affiliates                     | 26,244        | 39,704        | 73,420        | 39,704       
|Advisor asset management fee                                                | 60,000        | -             | 60,000        | -            
|Property operating expenses to   Affiliates                                 | 205,147       | 17,194        | 404,602       | 17,194       
|Property operating expenses to   non-affiliates                             | 942,722       | 255,656       | 2,405,233     | 255,656      
|Mortgage interest to Affiliates                                             | -             | 1,445         | -             | 1,445        
|Mortgage interest to non-  affiliates                                       | 1,890,008     | 155,246       | 3,656,161     | 155,246      
|Acquisition costs expense                                                   | 30,715        | 11,443        | 34,592        | 11,443       
|Depreciation                                                                | 1,113,887     | 87,819        | 2,019,968     | 87,819       
|Amortization                                                                | 50,324        | 199           | 70,348        | 199          
|                                                                            |               |               |               |              
|                                                                            | 4,419,612     | 648,167       | 8,966,097     | 648,167      
|                                                                            |               |               |               |              
|Net income (loss)                                                           | 92,267        | (6,089)       | 560,600       | (6,089)      
|                                                                            |               |               |               |              
|Net income (loss) per common   share, basic and diluted                     | .01           | (.01)         | .08           | (.01)        
|                                                                            |               |               |               |              
|Weighted average number of   common shares outstanding,   basic and diluted | 7,450,489     | 517,231       | 6,812,669     | 517,231      



















See accompanying notes to consolidated financial statements.

INLAND RETAIL REAL ESTATE TRUST, INC.

Consolidated Statement of Stockholders' Equity

For the Six Months Ended June 30, 2000

(unaudited)



|                                                                                                                                    | Common
Stock | Additional Paid-in
Capital | Accumulated
Distributions in excess of net Income | Total      
|----------------------------------------------------------------------------------------------------------------------------------- | ------------ | -------------------------- | ------------------------------------------------- | -----------
|Balance at December 31, 1999                                                                                                        | $   54,338   | 46,188,392                 | (1,228,865)                                       | 45,013,865 
|                                                                                                                                    |              |                            |                                                   |            
|Net income                                                                                                                          | --           | --                         | 560,600                                           | 560,600    
|Distributions declared   ($.75 per weighted average
number of common shares   outstanding)                                          | --           | --                         | (2,559,662)                                       | (2,559,662)
|Proceeds from offering   Including DRP (net of   current period and   cumulative offering   costs of $3,666,228, and   $11,723,268) | 27,822       | 24,121,189                 | --                                                | 24,149,011 
|Treasury Stock                                                                                                                      | (48)         | (43,008)                   | --                                                | (43,056)   
|                                                                                                                                    |              |                            |                                                   |            
|Balance at June 30, 2000                                                                                                            | $   82,112   | 70,266,573                 | (3,227,927)                                       | 67,120,758 
|                                                                                                                                    | ==========   | ===========                | ===========                                       | ===========















































See accompanying notes to consolidated financial statements.







INLAND RETAIL REAL ESTATE TRUST, INC.

(a Maryland corporation)

Consolidated Statements of Cash Flows

For the Six Months Ended June 30, 2000 and 1999

(unaudited)

|                                                                                      |              |  |             
|------------------------------------------------------------------------------------- | ------------ |  | ------------
|                                                                                      | 2000         |  | 1999        
|Cash flows from operating activities:                                                 |              |  |             
|Net income                                                                            | $  560,600   |  | $  (6,089)  
|Adjustments to reconcile net income to net     Cash provided by operating activities: |              |  |             
|Depreciation                                                                          | 2,019,968    |  | 87,819      
|Amortization                                                                          | 70,348       |  | 199         
|Interest escrow                                                                       | 53,085       |  | -           
|Rental income under master lease                                                      | 163,333      |  | -           
|Straight line rental income                                                           | (189,434)    |  | (9,645)     
|Changes in assets and liabilities:                                                    |              |  |             
|Accounts and rents receivable                                                         | (336,696)    |  | (253,521)   
|Other assets                                                                          | (409,834)    |  | (43,961)    
|Real estate tax and insurance escrows                                                 | (138,118)    |  | (328,343)   
|Accrued interest payable to non-        affiliates                                    | 162,958      |  | 90,969      
|Real estate tax payable                                                               | 937,663      |  | 138,650     
|Accounts payable                                                                      | 98,048       |  | 86,673      
|Unearned income                                                                       | 123,499      |  | 19,336      
|Other liabilities                                                                     | 68,987       |  | 2,480       
|Security deposits                                                                     | 71,524       |  | 54,567      
|Due to affiliates                                                                     | 731,138      |  | 361,036     
|Net cash provided by operating activities                                             | 3,987,069    |  | 200,170     
|                                                                                      |              |  |             
|Cash flows from investing activities:                                                 |              |  |             
|Restricted cash                                                                       | (40,578)     |  | -           
|Purchase of investment properties                                                     | (42,852,301) |  | (5,896,586) 
|Additions to investment properties                                                    | (74,101)     |  | -           
|Leasing Fees                                                                          | 4,500        |  | -           
|Net cash used in investing activities                                                 | (42,962,480) |  | (5,896,586) 
|                                                                                      |              |  |             
|Cash flows from financing activities:                                                 |              |  |             
|Proceeds from offering                                                                | 27,815,239   |  | 13,778,175  
|Repurchase of shares                                                                  | (43,056)     |  | -           
|Payment of offering costs                                                             | (4,831,279)  |  | (800,618)   
|Proceeds from debt financing                                                          | 22,120,000   |  | -           
|Principal payments of debt                                                            | (7,189,753)  |  | (16,561)    
|Loan fees                                                                             | (256,100)    |  | (10,499)    
|Distributions paid                                                                    | (2,397,488)  |  | (52,855)    
|Net cash provided by financing activities                                             | 35,217,563   |  | 12,897,642  
|                                                                                      |              |  |             
|Net (decrease) in cash and cash equivalents                                           | (3,757,848)  |  | 7,201,226   
|                                                                                      |              |  |             
|Cash and cash equivalents at January 1                                                | 14,869,164   |  | 202,000     
|                                                                                      |              |  |             
|Cash and cash equivalents at June 30                                                  | $ 11,111,316 |  | $  7,403,226
|                                                                                      | ============ |  | ============



See accompanying notes to consolidated financial statements.





INLAND RETAIL REAL ESTATE TRUST, INC.

(a Maryland corporation)

Consolidated Statement of Cash Flows

(continued)

For the Six Months Ended June 30, 2000 and 1999

(unaudited)

Supplemental schedule of noncash investing and financing activities:

|                                  |              |  |             
|--------------------------------- | ------------ |  | ------------
|                                  | 2000         |  | 1999        
|                                  |              |  |             
|Purchase of investment properties | -            |  | (20,293,031)
|Assumption of mortgage debt       | -            |  | 14,396,445  
|                                  | -            |  | (5,896,586) 
|                                  | ============ |  | ============
|                                  |              |  |             
|Distributions payable in July     | $   493,641  |  | $    66,296 
|                                  | ============ |  | ============
|                                  |              |  |             
|Cash paid for interest            | $ 3,430,213  |  | $  156,691  
|                                  | ============ |  | ============
|                                  |              |  |             
|                                  |              |  |             
|                                  |              |  |             
|                                  |              |  |             
|                                  |              |  |             
|                                  |              |  |             













































See accompanying notes to consolidated financial statements.



Notes to Consolidated Financial Statements

June 30, 2000

(unaudited)

The accompanying consolidated financial statements have been prepared in accordance with Generally Accepted Accounting Principles ("GAAP") for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. Readers of this Quarterly Report should refer to the audited financial
statements of Inland Retail Real Estate Trust, Inc. (the "Company") for the fiscal year ended December 31, 1999, which are included in the Company's 1999 Annual Report, as certain footnote disclosures contained in such audited financial statements have
been omitted from this Report. In the opinion of management, all adjustments (consisting of normal recurring accruals) necessary for a fair presentation have been included in this quarterly report.

(1) Organization and Basis of Accounting

Inland Retail Real Estate Trust, Inc. (the "Company") was formed on September 3, 1998 to acquire and manage a diversified portfolio of real estate, primarily multi-tenant shopping centers. It is anticipated that the Company will
initially focus on acquiring properties in the southeastern states, primarily Florida, Georgia, North Carolina and South Carolina. The Company may also acquire single-user retail properties in locations throughout the United States, certain of which may
be sale and leaseback transactions, net leased to creditworthy tenants. Inland Retail Real Estate Advisory Services, Inc. (the "Advisor"), an affiliate of the Company, is the advisor to the Company. On February 11, 1999, the Company commenced an initial
public offering ("Offering"), on a best efforts basis of 50,000,000 shares of common stock ("Shares") at $10 per Share and 4,000,000 Shares at $9.50 per Share which may be distributed pursuant to the Company's Distribution Reinvestment Program ("DRP"). As
of June 30, 2000, the Company had received subscriptions for a total of 8,089,156 Shares. In addition, the Company has issued 126,774 Shares pursuant to the Company's DRP. As of June 30, 2000, the Company has repurchased a total of 4,758 Shares through
the Company's Share Repurchase Program.

The Company is qualified and has elected to be taxed as a real estate investment trust ("REIT") under Section 856 through 860 of the Internal Revenue Code of 1986. Since the Company qualifies for taxation as a REIT, the Company
generally will not be subject to federal income tax to the extent it distributes at least 95% of its REIT taxable income to its stockholders. If the Company fails to qualify as a REIT in any taxable year, the Company will be subject to federal income tax
on its taxable income at regular corporate tax rates. Even if the Company qualifies for taxation as a REIT, the Company may be subject to certain state and local taxes on its income and property and federal income and excise taxes on its undistributed
income.

The preparation of consolidated financial statements in conformity with GAAP 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 consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.



Notes to Consolidated Financial Statements

(Continued)

June 30, 2000

(unaudited)



Statement of Financial Accounting Standards No. 121 requires the Company to record an impairment loss on its property to be held for investment whenever its carrying value cannot be fully recovered through estimated undiscounted future
cash flows from operations and sale of properties. The amount of the impairment loss to be recognized would be the difference between the property's carrying value and the property's estimated fair value. As of June 30, 2000, the Company does not believe
any such impairment of its properties exists.

Depreciation expense is computed using the straight-line method. Buildings and improvements are depreciated based upon estimated useful lives of 30 years for buildings and 15 years for the site improvements. Tenant improvements are
amortized on a straight-line basis over the life of the related leases.

Loan fees are amortized on a straight-line basis over the life of the related loans.

Offering costs are offset against the Stockholders' equity accounts and consist principally of printing, selling and registration costs.

Rental income is recognized on a straight-line basis over the term of each lease. The difference between rental income earned on a straight-line basis and the cash rent due under the provisions of the lease agreements is recorded as
deferred rent receivable.

The Company believes that the interest rates associated with the mortgages payable approximate the market interest rates for these types of debt instruments, and as such, the carrying amount of the mortgages payable approximate their
fair value.

In the opinion of management, the financial statements contain all the adjustments necessary, which are of a normal recurring nature, to present fairly the financial position and results of operations for the period presented herein.
Results of interim periods are not necessarily indicative of results to be expected for the year.

The carrying amount of cash and cash equivalents, restricted cash, accounts and rents receivable, accounts payable and other liabilities, accrued offering costs to affiliates and non-affiliates, accrued interest payable to
non-affiliates, accrued real estate taxes, distributions payable and due to affiliates approximate fair value because of the relatively short maturity of these instruments.

On December 2, 1999, the Securities and Exchange Commission issued Staff Accounting Bulletin 101, "Revenue Recognition in Financial Statements" (SAB 101). The staff determined that a lessor should defer recognition of contingent rental
income such as percentage/excess rent until the specified



Notes to Consolidated Financial Statements

(Continued)

June 30, 2000

(unaudited)



breakpoint that triggers the contingent rental income is achieved. The Company records percentage rental revenue in accordance with the SAB 101.

FASB Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities," effective for fiscal years beginning after June 15, 2000, establishes accounting and reporting standards requiring that every
derivative instrument, including certain derivative instruments imbedded in other contracts, be reported in the balance sheet as either an asset or liability measured at its fair value. The statement also requires that the changes in the derivative's fair
value be recognized in earnings unless specific hedge accounting criteria are met. Currently, the pronouncement has no impact on the Company, as the Company has not utilized derivative instruments or entered into any hedging activities.

(2) Basis of Presentation

The accompanying Consolidated Balance Sheet includes the accounts of the Company, as well as the accounts of the operating partnership, in which the Company has an approximately 99% controlling general partner interest. The Advisor
owns the remaining approximately 1% limited partner common units in the operating partnership for which it paid $2,000 and which is reflected as a minority interest in the accompanying Consolidated Balance Sheet. The effect of all significant intercompany
transactions have been eliminated.



(3) Transactions with Affiliates

As of June 30, 2000, the Company had incurred $11,723,288 of offering costs, of which $7,888,057 was paid to affiliates. Pursuant to the terms of the Offering, the Advisor is required to pay organizational and offering expenses
(excluding sales commissions, the marketing contribution and the due diligence expense allowance) in excess of 5.5% of the gross proceeds of the Offering ("Gross Offering Proceeds") or all organization and offering expenses (including selling commissions)
which together exceed 15% of Gross Offering Proceeds. As of June 30, 2000, offering costs did not exceed the 5.5% and 15% limitations, and the Company anticipates that these costs will not exceed these limitations upon completion of the Offering. Any
excess amounts at the completion of the Offering will be reimbursed by the Advisor.

The Advisor and its affiliates are entitled to reimbursement for salaries and expenses of employees of the Advisor and its affiliates relating to the Offering. In addition, an affiliate of the Advisor is entitled to receive selling
commissions, a marketing contribution and a due diligence expense allowance from the Company in connection with the Offering. Such costs are offset against the Stockholders' equity accounts. As of June 30, 2000 such costs totaled $6,291,222 of which
$47,009 was unpaid at June 30, 2000.

Notes to Consolidated Financial Statements

(Continued)

June 30, 2000

(unaudited)



The Advisor and its affiliates are entitled to reimbursement for salaries and expenses of employees of the Advisor and its affiliates relating to the administration of the Company. Such costs are included in professional services to
Affiliates and general and administrative expenses to Affiliates. The Company incurred $124,347 of these costs for the six months ended June 30, 2000, all of which remained unpaid.

The Advisor has contributed $200,000 to the capital of the Company for which it received 20,000 Shares.

The Advisor may receive an annual Advisor Asset Management Fee of not more than 1% of the Average Invested Assets, paid quarterly. For any year in which the Company qualifies as a REIT, the Advisor must reimburse the Company: (i) to the
extent that the Advisor Asset Management Fee plus other operating expenses paid during the previous calendar year exceed 2% of the Company's average invested assets for the calendar year or 25% of the Company's Net Income for that calendar year; and (ii)
to the extent that stockholders have not received an annual distribution equal to or greater than the 7% Current Return. For the six months ended June 30, 2000, the Company accrued $60,000 of such fees, which remain unpaid. For the six months ended June
30, 1999, no such fees were accrued or paid.

The property manager, an entity owned principally by individuals who are affiliates of the Advisor, is entitled to receive property management fees for management and leasing services. The Company incurred and paid property management
fees of $404,602 and $17,194 for the six months ended June 30, 2000 and 1999, respectively.



(4) Stock Option Plan and Soliciting Dealer Warrants

The Company adopted an Independent Director Stock Option Plan which, subject to certain conditions, provides for the grant to each Independent Director of an option to acquire 3,000 Shares following their becoming a Director and for
the grant of additional options to acquire 500 Shares on the date of each annual stockholders' meeting commencing with the annual meeting in 2000 if the Independent Director is a member of the board of directors on such date. The options granted for the
initial 3,000 Shares are exercisable as follows: 1,000 Shares on the date of grant and 1,000 Shares on each of the first and second anniversaries of the date of grant. The subsequent options will be exercisable on the second anniversary of the date of
grant. The initial options will be exercisable at $9.05 per Share. The subsequent options will be exercisable at the fair market value of a Share on the last business day preceding the annual meeting of Stockholders, and shall be $9.05 per Share until the
earlier of the termination of the Offering or February 11, 2001. As of June 30, 2000, options to acquire 10,500 Shares had been issued.



Notes to Consolidated Financial Statements

(Continued)

June 30, 2000

(unaudited)



In addition to sales commissions, the dealer manager of the Offering (an affiliate of the Advisor) has the right to purchase one soliciting dealer warrant for $.0008 for each 25 Shares sold by such soliciting dealer during the

Offering, subject to state and federal securities laws and subject to the issuance of a maximum of 2,000,000 soliciting dealer warrants to purchase an equivalent number of Shares. The dealer manager intends to reallow such warrants to
the soliciting dealers who sold such Shares. The holder of a soliciting dealer warrant will be entitled to purchase one Share from the Company at a price of $12 during the period commencing one year from the date of the first issuance of any of the
soliciting dealer warrants and ending five years after February 11, 1999. As of June 30, 2000, 323,232 soliciting dealer warrents had been issued. These warrants had no value and none had been exercised.

Notes to Consolidated Financial Statements

(Continued)

June 30, 2000

(unaudited)

(5) Investment Properties:

An affiliate of the Company initially purchased seven of the investment properties on behalf of the Company. The Company subsequently purchased each property from this affiliate at their costs upon receipt of proceeds from the Offering.

|                                    |             |                  |              |                          | Gross amount at which |              |             |              |           
|----------------------------------- | ----------- | ---------------- | ------------ | ------------------------ | --------------------- | ------------ | ----------- | ------------ | ----------
|                                    |             | Initial Costs(A) |              | Carried at June 30, 2000 |                       |              | Date        |             
|                                    |             |                  | Buildings    | Adjustments              |                       | Buildings    |             | Accumulated  | Con-      
|                                    |             |                  | And          | to                       |                       | And          | Total       | Depreciation | Stru-     
|                                    | Encumbrance | Land             | Improvements | Basis (C)                | Land                  | Improvements | (D)         | (E)          | cted      
|Multi-Tenant Retail                 |             |                  |              |                          |                       |              |             |              |           
|Lake Walden Square
Plant City, FL   | 9,996,931   | 3,006,662        | 11,549,586   | 39,399                   | 3,006,662             | 11,588,985   | 14,595,647  | 569,724      | 1992      
|Merchants Square
Zephyrhills, FL    | 3,167,437   | 992,225          | 4,749,818    | 12,619                   | 992,225               | 4,762,437    | 5,754,662   | 173,201      | 1993      
|Town Center Commons
Kennesaw, GA    | 4,750,000   | 3,293,792        | 6,350,835    | 22,365                   | 3,293,792             | 6,373,200    | 9,666,992   | 221,310      | 1998      
|Boynton Commons
Boynton Beach, FL   | 19,662,500  | 8,698,355        | 21,803,370   | (63,157)                 | 8,698,355             | 21,740,213   | 30,438,568  | 719,992      | 1998      
|Lake Olympia Square
Ocoee, FL       | 5,838,681   | 2,567,471        | 7,306,483    | (89,077)                 | 2,567,471             | 7,217,406    | 9,784,877   | 226,409      | 1995      
|Bridgewater Marketplace
Orlando, FL | 4,780,000   | 783,492          | 5,221,618    | (10,465)                 | 783,492               | 5,211,153    | 5,994,645   | 153,382      | 1998      
|Bartow Marketplace
Cartersville, GA | 18,375,000  | 6,098,178        | 18,308,271   | 1,059                    | 6,098,178             | 18,309,330   | 24,407,508  | 488,219      | 1995      
|Countryside
Naples, FL              | 6,720,000   | 1,117,428        | 7,478,173    | 7,049                    | 1,117,428             | 7,485,222    | 8,602,650   | 189,278      | 1997      
|Casselberry Commons
Naples, FL      | 12,619,550  | 6,702,658        | 11,191,912   | (74,210)                 | 6,702,658             | 11,117,702   | 17,820,360  | 216,085      | 1973/
1998
|Conway Plaza
Orlando, FL            | 5,000,000   | 2,215,325        | 6,332,434    | (18,700)                 | 2,215,325             | 6,313,734    | 8,529,059   | 107,874      | 1985/1999 
|Pleasant Hill
Duluth, GA            | 17,120,000  | 4,809,330        | 29,547,805   | (15,193)                 | 4,809,330             | 29,532,612   | 34,341,942  | 180,185      | 1997/2000 
|Totals                              | 108,030,099 | 40,284,916       | 129,840,305  | (188,311)                | 40,284,916            | 129,651,994  | 169,936,910 | 3,245,659    |           
|                                    |             |                  |              |                          |                       |              |             |              |           
|Furniture and Equipment             |             |                  |              |                          |                       |              | 12,189      | 3,632        |           
|                                    |             |                  |              |                          |                       |              | 169,949,099 | 3,249,291    |           



Notes to Consolidated Financial Statements

(Continued)

June 30, 2000

(unaudited)



(A) The initial cost to the Company represents the original purchase price of the property from an affiliate of our Advisor, or an unaffiliated third party, including amounts incurred subsequent to acquisition, most of which were
contemplated at the time the property was acquired.

(B) Adjustments to basis includes additions to investment properties net of payments received under master lease agreements. See footnote 6.

(C) When Lake Olympia Square was purchased by an affiliate of our Advisor, $234,145 was escrowed at the closing. At the time of purchase by the Company, $89,400 of these funds remained available to be used on a monthly basis to pay the
principal portion of the debt service through July 2000. The net effect of this structure is that the Company had paid only the interest portion of the debt service through June 30, 2000. The cumulative amount received by the Company was $89,400 as of

(6) Leases

Master Leases

In connection with certain acquisitions, the Company receives payments under master lease agreements on some of the space which was vacant at the time of the purchase, for periods ranging from one to two years after the date of the
purchase or until the spaces are leased. GAAP requires that as these payments are received, they be recorded as a reduction in the basis of the property. The cumulative amount of such payments was $314,645 as of June 30, 2000.

Operating Leases

Certain tenant leases contain provisions providing for stepped rent increases. GAAP requires the Company to record rental income for the period of occupancy using the effective monthly rent, which is the average monthly rent for the
entire period of occupancy during the term of the lease. The accompanying consolidated financial statements include an increase of $189,434 for the six months ended



Notes to Consolidated Financial Statements

(Continued)

June 30, 2000

(unaudited)



(7) Mortgages Payable

Mortgages payable consist of the following at

|Property as Collateral  | Interest
Rate | Maturity
Date | Monthly
Payments | Balance at
June 30, 2000
|----------------------- | ------------- | ------------- | ---------------- | ------------------------
|Lake Walden Square      | 7.63%         | 11/2007       | $  72,584 (a)    | $  9,996,931            
|Merchants Square        | 7.25%         | 11/2008       | (b)              | 3,167,437               
|Town Center Commons     | 7.00%         | 04/2006       | (b)              | 4,750,000               
|Boynton Commons *       | 8.35%         | 09/2000       | (c)              | 4,537,500               
|                        | 7.21%         | 03/2006       | (b)              | 15,125,000              
|Lake Olympia Square     | 8.25%         | 04/2007       | 50,978 (a)       | 5,838,681               
|Bridgewater Marketplace | 8.35%         | 09/2000       | (c)              | 1,792,500               
|                        | 8.35%         | 09/2006       | (c)              | 2,987,500               
|Bartow Marketplace      | 8.10%         | 09/2000       | (c)              | 4,900,000               
|                        | 8.10%         | 09/2004       | (c)              | 13,475,000              
|Countryside             | 8.35%         | 03/2001       | (c)              | 6,720,000               
|Casselberry Commons *   | 9.10%         | 10/2000       | (c)              | 3,916,550               
|                        | 7.64%         | 04/2006       | (b)              | 8,703,000               
|Conway Plaza            | 8.25%         | 06/2005       | (c)              | 5,000,000               
|Pleasant Hill Square    | 8.00%         | 06/2005       | (c)              | 17,120,000              
|                        |               |               |                  |                         
|                        |               |               |                  | $108,030,099            
|                        |               |               |                  | =============           
|                        |               |               |                  |                         

(a) Payments include principal and interest at a fixed rate.

(b) Payments include interest only at a fixed rate.

(c) Payments include interest only. Payments on these mortgages adjust monthly and are calculated based on a floating rate over LIBOR.

* Certain of the mortgages payable are subject to guarantees, in which an affiliate of the Advisor has guaranteed payment on these notes to the lender.

All of these mortgages are serviced by an affiliate of the Advisor on behalf of the Company. The affiliate receives servicing fees at a market rate for such services.



Notes to Consolidated Financial Statements

(Continued)

June 30, 2000

(unaudited)



(8) Segment Reporting

The Company owns and seeks to acquire multi-tenant shopping centers in the southeastern states, primarily Florida, Georgia, North Carolina and South Carolina. All of the Company's shopping centers are located within Florida and
Georgia. The Company's shopping centers are typically anchored by grocery and drug stores complemented with additional stores providing a wide range of other goods and services to shoppers.

The Company assesses and measures operating results on an individual property basis for each of its properties based on net property operations. Since all of the Company's properties exhibit highly similar economic characteristics,
cater to the day-to-day living needs of their respective surrounding communities, and offer similar degrees of risk and opportunities for growth, the properties have been aggregated and reported as one operating segment.

The property revenues and net property operations of the reportable segments are summarized in the following tables as of June 30, 2000 and 1999, and for the six month periods then ended, along with a reconciliation to net income.

Property asset information is as of June 30, 2000 and December 31, 1999.

|                              | 2000          | 1999        
|----------------------------- | ------------- | ------------
|                              |               |             
|Total property revenues       | $   9,161,240 | 606,486     
|Total property operating      |               |             
|Expenses                      | 2,809,835     | 272,850     
|Mortgage interest             | 3,656,161     | 156,691     
|                              |               |             
|Net property operations       | 2,695,244     | 176,945     
|                              |               |             
|Interest income               | 347,823       | 35,592      
|Other income                  | 17,634        | --          
|Less non property expenses:   |               |             
|Professional services         | 132,755       | 39,275      
|General and administrative    | 217,030       | 91,333      
|Advisor asset management fee  | 60,000        | --          
|Depreciation and amortization | 2,090,316     | 88,018      
|                              |               |             
|Net income                    | $560,600      | (6,089)     
|                              |               |             
|Total Assets                  |               |             
|Shopping Centers              | $166,699,808  | 126,009,792 
|Non-segment assets            | 15,516,409    | 17,978,344  
|                              | $182,216,217  | 143,988,136 
|                              | ============  | ============



Notes to Consolidated Financial Statements

(Continued)

June 30, 2000

(unaudited)



(9) Earnings per Share

Basic earnings per share ("EPS") is computed by dividing income available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted EPS is computed by reflecting the potential
dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company.

As of June 30, 2000, warrants to purchase 323,232 shares of common stock at a price of $12.00 per share were outstanding, but were not included in the computation of diluted EPS because the exercise price of such warrants was greater
than the average market price of common shares. The weighted average number of common shares outstanding were 6,812,669 for the period ended June 30, 2000.

(10) Commitment and Contingencies

The Company is not subject to any material pending legal proceeding.



(11) Subsequent Events

The Company paid distributions of $493,641 and $548,320 to its stockholders in July and August, 2000, respectively.

On July 18, 2000, the Company purchased Gateway Market Center in St. Petersburg, FL for $20,850,000. A portion of the purchase was financed with debt totaling $15,370,500.

On July 29, 2000, the Company made a scheduled principal payment of $1,000,000 to the lender on Casselberry Commons Shopping Center.





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

Certain statements in this "Management's Discussion and Analysis of Financial Condition and Results of Operations" and elsewhere in this quarterly report on Form 10-Q constitute "forward-looking statements" within the meaning of the
Federal Private Securities Litigation Reform Act of 1995. These forward- looking statements involve known and unknown risks, uncertainties and other factors which may cause the Company's actual results, performance or achievements to be materially
different from any future results, performance or achievements expressed or implied by these forward-looking statements. These factors include, among other things, limitations on the area in which the Company may acquire properties; risks associated with
borrowings secured by the Company's properties; competition for tenants and customers; federal, state or local regulations; adverse changes in general economic or local conditions; competition for property acquisitions with third parties that have greater
financial resources than the Company; inability of lessees to meet financial obligations; uninsured losses; risks of failing to qualify as a REIT; and potential conflicts of interest between the Company and its affiliates including the Advisor. The
abbreviations made in the Notes to Consolidated Financial Statements are used in this Item 2.



Liquidity and Capital Resources

The Company was formed on September 3, 1998 to acquire and manage a diversified portfolio of real estate, primarily multi-tenant shopping centers. It is anticipated that the Company will initially focus on acquiring properties in
the southeastern states, primarily Florida, Georgia, North Carolina and South Carolina. The Company may also acquire single-user retail properties in locations throughout the United States, certain of which may be sale and leaseback transactions, net
leased to creditworthy tenants. On February 11, 1999, the Company commenced the Offering of 50,000,000 Shares at a price of $10 per Share and of 4,000,000 Shares at a price of $9.50 per Share which may be distributed pursuant to the Company's distribution
reinvestment program ("DRP"). Inland Retail Real Estate Advisory Services, Inc. is the Advisor to the Company. As of June 30, 2000, subscriptions for a total of 8,089,156 Shares had been received from the public, which includes 20,000 Shares issued to the
Advisor. In addition, the Company has distributed 126,774 Shares pursuant to the Company's DRP. The Advisor has guaranteed payment of all public offering expenses (excluding selling commissions, the marketing contribution and the due diligence expense
allowance) in excess of 5.5% of the Gross Offering Proceeds or all organization and offering expenses (including such selling expenses) which together exceeds 15% of the Gross Offering Proceeds. As of June 30, 2000, organizational and offering costs
totaling $11,723,267 did not exceed these limitations, and the Company anticipates that these costs will not exceed these limitations upon completion of the Offering. Any excess amounts at the completion of the Offering will be reimbursed by the Advisor.

The Company will provide the following programs to facilitate investment in the Shares and to provide limited liquidity for Stockholders until such time as a market for the Shares develops:



The distribution reinvestment program will allow stockholders who purchase Shares pursuant to the Offering to automatically reinvest distributions by purchasing additional Shares from the Company. Such purchases will not be subject to
selling commissions or the marketing contribution and due diligence expense allowance and will be sold at a price of $9.50 per Share.

The share repurchase program will, subject to certain restrictions, provide existing stockholders with limited, interim liquidity by enabling them to sell Shares back to the Company. The prices at which Shares may be sold back to the
Company are as follows:

- During the Offering period at $9.05 per Share;

- During the 12 months following the end of the Offering period at $9.25 per

Share;

- During the next 12 months at $9.50 per Share;

- During the next 12 months at $9.75 per Share; and

- Thereafter, at the greater of: (i) $10 per Share; or (ii) a price equal to

10 times our "funds available for distribution" per weighted average Share

outstanding for the prior calendar year.

Shares purchased by the Company will not be available for resale. As of June 30, 2000, 4,758 Shares had been repurchased at the cost of $43,056.

Cash Flows From Operating Activities

Net cash provided by operating activities generated $3,987,069 for the six months ended June 30, 2000. This is due primarily to the operations of the nine properties acquired during 1999 and two additional properties acquired during
the six months ended June 30, 2000.

Cash Flows From Investing Activities

Cash flows used in investing activities were utilized primarily for the purchase of two properties in each of the six month periods ended June 30, 2000 and 1999.

Cash Flows From Financing Activities

For the six months ended June 30, 2000, the Company generated $35,217,563 of cash flows from financing activities. This was due primarily to proceeds raised of $27,815,239 from the sale of Shares for the six months ended June 30,
2000. The Company's cash flow from financing activities was partially offset by the cash used to pay costs associated with selling Shares for the six months ended June 30, 2000. For the six months ended June 30, 2000, the Company paid offering costs
totaling $4,831,926. The Company also issued debt totaling $22,120,000. In addition, for the six months ended June 30, 2000 the Company also paid distributions of $2,396,841 and loan fees of $256,100.

Results of Operations

Through June 30, 2000, the Company had incurred a total of $11,723,288 for costs incurred with the Offering, of which $1,698,854 remained unpaid.

Rental income, additional rental income, property operating expenses, mortgage interest and depreciation are all a result of the operations from the nine properties acquired during 1999 and two additional properties acquired in 2000.

Winn-Dixie, an anchor tenant in three of the properties owned by the Company, whose gross rental income from its three stores in the Company's properties represents 6% of the Company's total gross rental income from all of its
properties as of June 30, 2000, is currently under going a restructuring. The Company has been assured by management of Winn-Dixie that the stores located in the Company's specific properties are not closing as part of the restructuring.

Funds from Operations

One of the Company's objectives is to provide cash distributions to its stockholders from cash generated by the Company's operations. Cash generated from operations is not equivalent to the Company's net operating income as
determined under GAAP. Due to certain unique operating characteristics of real estate companies, the National Association of Real Estate Investment Trusts ("NAREIT"), an industry trade group, has promulgated a standard known as "Funds from Operations" or
"FFO" for short, which it believes more accurately reflects the operating performance of a REIT such as the Company. As defined by NAREIT, FFO means net income computed in accordance with GAAP excluding gains (or losses) from debt restructuring and sales
of properties plus depreciation and amortization and after adjustments for unconsolidated partnership and joint ventures in which the REIT holds an interest. The Company has adopted the NAREIT definition for computing FFO because management believes that,
subject to the following limitations, FFO provides a basis for comparing the performance and operations of the Company to those of other REITs. The calculation of FFO may vary from entity to entity since capitalization and expense policies tend to vary
from entity to entity. Items which are capitalized do not impact FFO, whereas items that are expensed reduce FFO. Consequently, the presentation of FFO by the Company may not be comparable to other similarly titled measures presented by other REITs. FFO
is not intended to be an alternative to "Net Income" as an indicator of the Company's performance nor to "Cash Flows from Operating Activities" as determined by GAAP as a measure of the Company's capacity to pay distributions. FFO and funds available for
distribution are calculated as follows:

| |                                    | Six months ended June 30,
| | ---------------------------------- | -------------------------
| |                                    | 2000                     
| |                                    |                          
| | Net income (loss)                  | $    560,600             
| | Depreciation                       | 2,019,968                
| |                                    |                          
| | Funds from operations (1)          | 2,580,568                
| |                                    |                          
| | Principal amortization of debt     | (116,423)                
| | Deferred rent receivable (2)       | (189,434)                
| | Income received under master lease |                          
| | Agreements and other escrows (4)   | 216,418                  
| | Acquisition costs expenses (3)     | 34,592                   
| |                                    |                          
| | Funds available for distribution   | $2,525,721               
| |                                    | ===========              







(1) FFO does not represent cash generated from operating activities calculated in accordance with GAAP and is not necessarily indicative of cash available to fund cash needs. FFO should not be considered as an alternative to
net income as an indicator of the Company's operating performance or as an alternative to cash flow as a measure of liquidity.

(2) Certain tenant leases contain provisions providing for stepped rent increases. GAAP requires the Company to record rental income for the period of occupancy using the effective monthly rent, which is the average monthly
rent for the entire period of occupancy during the term of the lease.

(3) Acquisition costs expensed include certain costs and expenses relating to the acquisition of properties. These costs are estimated to be up to .5% of the Gross Offering Proceeds and are paid from the proceeds of the
Offering.

(4) As part of several purchases, the Company receives payments under master lease agreements on some of the space which was vacant at the time of the purchase for periods ranging from one to two years from the date of the
purchase or until the spaces are leased. In addition, the Company received payments from other escrow arrangements. GAAP requires that as these payments are received, they be recorded as a reduction in the purchase price of the properties rather than as
rental income.

The following table lists the approximate physical occupancy levels for the Company's properties as of the end of each quarter during 2000 and 1999. N/A indicates the property was not owned by the Company at the end of the quarter.





|                                      | 2000         | 1999        
|------------------------------------- | ------------ | ------------
|Properties:                           | at
03/31
(%) | at
06/30
(%)
|Lake Walden Square   Plant City, FL   | 94           | 84          
|Merchants Square   Zephyrhills, FL    | 100          | 100         
|Town Center Commons   Kennesaw, GA    | 93           | 93*         
|Boynton Commons
Boynton Beach, FL     | 97*          | 96*         
|Lake Olympia Square   Ocoee, FL       | 100          | 85          
|Bridgewater Marketplace   Orlando, FL | 97*          | 98*         
|Bartow Marketplace   Cartersville, GA | 100          | 100         
|Countryside   Naples, Fl              | 98           | 98          
|Casselberry Commons   Casselberry, FL | 97*          | 95*         
|Conway Plaza   Orlando, Fl            | 97*          | 97*         
|Pleasant Hill
Duluth, GA              | N/A          | 92*         
|                                      |              |             

* As part of the purchase of some of the properties, the Company received payments under master lease agreements on some of the space which was vacant at the time of purchase, which results in economic occupancy ranging
from 99% to 100% at June 30, 2000 for each of these shopping centers. The master lease agreements are for periods ranging from one to two years from the purchase date or until the spaces are leased. The percentages in the above table do not include
unleased space covered by master lease agreements.

Year 2000 Issues

As part of it's year end 2000 readiness plan, the Company had identified three areas for compliance efforts: business computer systems, tenants and suppliers and non-information technology systems. The Company has not experienced and does not
anticipate experiencing any problems relating to year 2000 issues in any of these areas. Total costs associated with year 2000 readiness were not significant.



New Accounting Literature

On December 2, 1999, the Securities and Exchange Commission issued Staff Accounting Bulletin 101, "Revenue Recognition in Financial Statements" (SAB 101). The staff determined that a lessor should defer recognition of contingent
rental income such as percentage/excess rent until the specified breakpoint that triggers the contingent rental income is achieved. The Company records percentage rental revenue in accordance with the SAB 101.

FASB Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities," effective for fiscal years beginning after June 15, 2000, establishes accounting and reporting standards requiring that every
derivative instrument, including certain derivative instruments imbedded in other contracts, be reported in the balance sheet as either an asset or liability measured at its fair value. The statement also requires that the changes in the derivative's fair
value be recognized in earnings unless specific hedge accounting criteria are met. Currently, the pronouncement has no impact on the Company, as the Company has not utilized derivative instruments or entered into any hedging activities.



Subsequent Events

The Company paid distributions of $493,641 and $548,320 to its stockholders in July and August, 2000, respectively.

On July 18, 2000, the Company purchased Gateway Market Center in St. Petersburg, FL for $20,850,000. A portion of the purchase was financed with debt totaling $15,370,500 to finance this purchase.

On July 29, 2000, the Company made a scheduled principal payment of $1,000,000 to the lender on Casselberry Commons Shopping Center.



Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Company is exposed to interest rate changes primarily as a result of its long-term debt used to maintain liquidity and fund capital expenditures and expansion of the Company's real estate investment portfolio and operations. The
Company's interest rate risk management objectives are to limit the impact of interest rate changes on earnings and cash flows and to lower its overall borrowing costs. To achieve its objectives the Company borrows primarily at fixed rates or at floating
rates with the option to fix the rate at a later date and may enter into derivative financial instruments such as interest rate swaps, caps and treasury locks in order to mitigate its interest rate risk on related financial instruments. The Company does
not enter into derivative or interest rate transactions for speculative purposes.

The Company's interest rate risk is monitored using a variety of techniques. The table below presents the principal amounts and weighted average interest rates by year of expected maturity to evaluate the expected cash flows and
sensitivity to interest rate changes.

|                   | 2000        | 2001      | 2002    | 2003    | 2004      
|------------------ | ----------- | --------- | ------- | ------- | ----------
|Fixed rate debt    | $   121,139 | 257,199   | 278,462 | 303,957 | 353,316   
|Weighted average   |             |           |         |         |           
|Interest rate on   |             |           |         |         |           
|Maturing debt      | --          | --        | --      | --      | --        
|                   |             |           |         |         |           
|Variable rate debt | $15,146,550 | 6,720,000 | --      | --      | 13,475,000
|Weighted average   |             |           |         |         |           
|Interest rate on   |             |           |         |         |           
|Maturing debt      | 8.53%       | 8.35%     | --      | --      | 8.10%     

The fair value of the Company's debt approximates its carrying amount.

Approximately $60,449,000, or 56% of the Company's mortgages payable at June 30, 2000, have variable interest rates averaging 8.33%. An increase in the variable interest rate on certain mortgages payable constitutes a market risk.

PART II - Other Information

Items 1, 3 and 5 are omitted because of the absence of conditions under which they are required.



Item 2. Changes in Securities and Use of Proceeds

The Company has registered pursuant to a registration statement under the Securities Act of 1933 (SEC File Number 333-64391) the offering on a best efforts basis of 50,000,000 Shares at $10.00 per Share, subject to discounts in certain cases; up to
4,000,000 Shares at $9.50 per Share pursuant to the Company's DRP; 2,000,000 Soliciting Dealer Warrants at $.0008 per Soliciting Dealer Warrants; and 2,000,000 Shares issuable upon exercise of the Soliciting Dealer Warrants at an exercise price of $12.00
per Share (the "Offering"). The Offering commenced on February 11, 1999 and has not terminated. The maximum aggregate Offering price of the securities registered is $562,001,600. Inland Securities Corporation, an affiliate of the Advisor, is the Dealer
Manager of the Offering.

As of June 30, 2000, the Company has sold the following securities for the following aggregate offering prices:

|*                                                                  | 8,089,156 | Shares on a best efforts basis for $80,835,678;                                           
|------------------------------------------------------------------ | --------- | ------------------------------------------------------------------------------------------
|*                                                                  | 126,774   | Shares pursuant to the DRP for $1,204,350;                                                
|*                                                                  | 323,232   | Soliciting Dealer Warrants; and                                                           
|*                                                                  | 0         | Shares pursuant to the exercise of Soliciting Dealer Warrants,                            
|                                                                  
|and repurchased the following securities for the following amount:
|                                                                   |           |                                                                                           
|*                                                                  | (4,758)   | Shares repurchased pursuant to the Share Repurchase Program for $43,056                   
|*                                                                  |           | for a net total of 8,211,172 Shares for $81,996,972 of gross proceeds as of June 30, 2000.

The above-stated number of Shares sold and the gross offering proceeds received from such sales do not include the 20,000 Shares purchased by the Advisor for $200,000 preceding the commencement of the
Offering. As of June 30, 2000, 323,232 Soliciting Dealer Warrants had been earned; all of which have been issued, the $215 of gross proceeds received for their issuance is not included above.

From the February 11, 1999 effective date of the Offering through June 30, 2000 (the "Cumulative Period"), the following expenses have been incurred for the Company's account in connection with the issuance and distribution of the
registered securities:

|Type of Expense                        | Amount      | E=Estimated
A=Actual
|-------------------------------------- | ----------- | --------------------
|Underwriting Discounts and commissions | $ 7,245,058 | A                   
|Finders' fees                          | --          | A                   
|Expenses paid to or for underwriters   | --          | A                   
|Other expenses to affiliates           | 642,000     | A                   
|Other expenses paid to non-affiliates  | 3,835,230   | A                   
|Total expenses                         | $11,723,288 |                     

The underwriting discounts and commissions, and the expenses paid to or for underwriters, were paid to Inland Securities Corporation. Inland Securities

Corporation reallowed all or a portion of the commissions and expenses to Soliciting Dealers.



Total expenses of $11,723,288 include $1,698,854 which were unpaid at June 30, 2000. The net offering proceeds to the Company for the Cumulative Period, after deducting the total cash expenses paid described in the above table, are
$71,890,594.

For the Cumulative Period, the Company used the net offering proceeds as follows:

|Use of Proceeds                                | Amount       | E=Estimated
A=Actual
|---------------------------------------------- | ------------ | --------------------
|Construction of plant, building and facilities | --           | A                   
|Purchase of real estate                        | $ 53,642,860 | A                   
|Acquisition of other businesses                | --           | A                   
|Repayment of indebtedness                      | 8,173,330    | A                   
|Working capital                                | 347,530      | E                   
|Temporary investments                          | 9,726,874    | A                   
|Other uses                                     | --           | A                   

Of the amount used for purchases of real estate, $10,502,117 was paid to affiliates of the Advisor in connection with the acquisition of properties from such affiliates. Pending purchases of real estate,
the Company temporarily invested net offering proceeds in short-term interest bearing accounts.



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

On June 1, 2000, the Company held its first annual meeting of stockholders. At this stockholders meeting a majority of the stockholders elected Daniel K. Deighan, Kenneth E. Masick, Michael S. Rosenthal, Robert D. Parks, and Barry, L.
Lazarus as directors until our next annual stockholders meeting. A majority of the stockholders also ratified the appointment of KPMG LLP as our independent auditors for the 2000 fiscal year.

The Company received proxies representing 3,583,949 of the Company's 6,818,556 Shares outstanding as of April 1, 2000, the record date. The number of votes for, against, and withheld were as follows:

|                                     | For       | Against | Abstentions
|------------------------------------ | --------- | ------- | -----------
|                                     |           |         |            
|Directors:                           |           |         |            
|Daniel K, Deighan                    | 3,552,450 | 33,842  | -          
|Kenneth E. Masick                    | 3,551,450 | 34,842  | -          
|Michael S. Rosenthal                 | 3,551,450 | 34,842  | -          
|Robert D. Parks                      | 3,551,450 | 34,842  | -          
|Barry L. Lazarus                     | 3,551,450 | 34,842  | -          
|                                     |           |         |            
|Ratification of KPMG LLP as auditors | 3,521,897 | 4,960   | 59,436     
|                                     |           |         |            





Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits required by the Securities and Exchange Commission Regulations

S-K. Item 601.

The following documents are incorporated by reference:

Registration Statement on Form S-11 and related exhibits, as amended,

File No. 333-64391, filed under the Securities Act of 1933.

(b) Reports on Form 8-K:

The following reports on Form 8-K were filed during the quarter of the

period covered by this report.

Report on Form 8-K dated May 26, 2000

Item 2. Acquisition or Disposition of Assets







SIGNATURES





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.





INLAND RETAIL REAL ESTATE TRUST, INC.





/S/ ROBERT D. PARKS

By: Robert D. Parks

Chairman and Chief Executive Officer

Date: August 14, 2000





/S/ BARRY L. LAZARUS

By: Barry L. Lazarus

President and Chief Operating Officer

Treasurer and Chief Financial Officer

Date: August 14, 2000