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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





FORM 10-Q





(Mark One)

|x | Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ---------------------------------------------------------------------------------------

for the quarterly period ended March 31, 2010

OR



| ̈ | Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ----------------------------------------------------------------------------------------

for the transition period from  to

Commission file number 000-51262

WELLS REAL ESTATE INVESTMENT TRUST II, INC.

(Exact name of registrant as specified in its charter)







|                                                               |  |                                        
|-------------------------------------------------------------- |  | ---------------------------------------
|Maryland                                                       |  | 20-0068852                             
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification Number)

6200 The Corners Parkway

Norcross, Georgia 30092

(Address of principal executive offices)

(Zip Code)

(770) 449-7800

(Registrants telephone number, including area code)

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   ̈

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any,
every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post
such files).

[Not yet applicable to
registrant.]    Yes   ̈    No   ̈

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated
filer, or a smaller reporting company. See definitions of large accelerated filer, accelerated filer, and smaller reporting company in Rule 12b-2 of the Exchange Act (check one).

Large Accelerated filer   ̈    Accelerated
filer   ̈    Non-Accelerated filer  x    Smaller reporting
company   ̈

(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes   ̈    No  
x

Number of shares outstanding of the registrants

only class of common stock, as of April 30, 2010: 515,736,352 shares









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FORM 10-Q

WELLS REAL ESTATE INVESTMENT TRUST II, INC.

TABLE OF CONTENTS



|                              |  |                                                                                                                  |  |         
|----------------------------- |  | ---------------------------------------------------------------------------------------------------------------- |  | --------
|                              |  |                                                                                                                  |  | Page No.
|PART I. FINANCIAL INFORMATION |  |                                                                                                                 
|                              |  |                                                                                                                 
|Item 1.                       |  | Condensed Consolidated Financial Statements                                                                      |  |         
|                              |  |                                                                                                                 
|                              |  | Consolidated Balance Sheets as of March 31, 2010 (unaudited) and December 31, 2009                               |  | 5       
|                              |  |                                                                                                                 
|                              |  | Consolidated Statements of Operations for the Three Months Ended March 31, 2010 (unaudited) and 2009 (unaudited) |  | 6       
|                              |  |                                                                                                                 
|                              |  | Consolidated Statements of Equity for the Three Months Ended March 31, 2010 (unaudited) and 2009 (unaudited)     |  | 7       
|                              |  |                                                                                                                 
|                              |  | Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2010 (unaudited) and 2009 (unaudited) |  | 8       
|                              |  |                                                                                                                 
|                              |  | Condensed Notes to Consolidated Financial Statements (unaudited)                                                 |  | 9       
|                              |  |                                                                                                                 
|Item 2.                       |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                            |  | 19      
|                              |  |                                                                                                                 
|Item 3.                       |  | Quantitative and Qualitative Disclosures About Market Risk                                                       |  | 29      
|                              |  |                                                                                                                 
|Item 4T.                      |  | Controls and Procedures                                                                                          |  | 31      
|                              | 
|PART II. OTHER INFORMATION    |  |                                                                                                                 
|                              |  |                                                                                                                 
|Item 1.                       |  | Legal Proceedings                                                                                                |  | 31      
|                              |  |                                                                                                                 
|Item 1A.                      |  | Risk Factors                                                                                                     |  | 32      
|                              |  |                                                                                                                 
|Item 2.                       |  | Unregistered Sales of Equity Securities and Use of Proceeds                                                      |  | 32      
|                              |  |                                                                                                                 
|Item 3.                       |  | Defaults Upon Senior Securities                                                                                  |  | 33      
|                              |  |                                                                                                                 
|Item 4.                       |  | RESERVED                                                                                                         |  | 33      
|                              |  |                                                                                                                 
|Item 5.                       |  | Other Information                                                                                                |  | 33      
|                              |  |                                                                                                                 
|Item 6.                       |  | Exhibits                                                                                                         |  | 33      



2



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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this Form 10-Q of Wells Real Estate Investment Trust II, Inc. (Wells REIT II, we,
our or us) other than historical facts may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. We intend
for all such forward-looking statements to be covered by the applicable safe harbor provisions for forward-looking statements contained in those acts. Such statements include, in particular, statements about our plans, strategies, and prospects and
are subject to certain risks and uncertainties, including known and unknown risks, which could cause actual results to differ materially from those projected or anticipated. Therefore, such statements are not intended to be a guarantee of our
performance in future periods. Such forward-looking statements can generally be identified by our use of forward-looking terminology such as may, will, expect, intend, anticipate,
estimate, believe, continue, or other similar words. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this report is filed with the Securities
and Exchange Commission (SEC). We make no representations or warranties (express or implied) about the accuracy of any such forward-looking statements contained in this Form 10-Q, and we do not intend to publicly update or revise any
forward-looking statements, whether as a result of new information, future events, or otherwise.

Any such forward-looking
statements are subject to risks, uncertainties, and other factors and are based on a number of assumptions involving judgments with respect to, among other things, future economic, competitive, and market conditions, all of which are difficult or
impossible to predict accurately. To the extent that our assumptions differ from actual conditions, our ability to accurately anticipate results expressed in such forward-looking statements, including our ability to generate positive cash flow from
operations, make distributions to stockholders, and maintain the value of our real estate properties, may be significantly hindered. [See Item 1A in this Form 10-Q and] Item 1A in Wells REIT IIs Annual Report on Form 10-K for the
year ended December 31, 2009, for a discussion of some of the risks and uncertainties that could cause actual results to differ materially from those presented in our forward-looking statements. The risk factors described herein and in our
Annual Report are not the only ones we face, but do represent those risks and uncertainties that we believe are material to us. Additional risks and uncertainties not currently known to us or that we currently deem immaterial may also harm our
business.



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PART I. FINANCIAL INFORMATION



|ITEM 1. | CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
|------- | -------------------------------------------

The information furnished in the accompanying consolidated balance sheets and related consolidated statements of operations, equity and
cash flows reflects all adjustments that are, in managements opinion, necessary for a fair and consistent presentation of the aforementioned financial statements.

The accompanying consolidated financial statements should be read in conjunction with the condensed noted to Wells REIT IIs
financial statements and Managements Discussion and Analysis of Financial Condition and Results of Operations included in the quarterly report on Form 10-Q and with Wells REIT IIs Annual Report on Form 10-K for the year ended
December 31, 2009. Wells REIT IIs results of operations for the three months ended March 31, 2010, are not necessarily indicative of the operating results expected for the full year.



4



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WELLS REAL ESTATE INVESTMENT TRUST II, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per-share amounts)



|                                                                                                                                                                                 |  |                           |            |   |                  |   |           |  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------- | ---------- | - | ---------------- | - | --------- | -
|                                                                                                                                                                                 |  | (Unaudited)March 
31,2010 |            |   | December 31,2009 |  
|Assets:                                                                                                                                                                          |  |                           |            |   |                  |   |           |  
|Real estate assets, at cost:                                                                                                                                                     |  |                           |            |   |                  |   |           |  
|Land                                                                                                                                                                             |  | $                         | 555,308    |   |                  | $ | 553,515   |  
|Buildings and improvements, less accumulated depreciation of $337,927 and $314,348 as of March 31, 2010 and
December 31, 2009, respectively                                      |  |                           | 3,009,246  |   |                  |   | 2,991,502 |  
|Intangible lease assets, less accumulated amortization of $336,761 and $320,733 as of March 31, 2010 and December 31,
2009, respectively                                         |  |                           | 480,823    |   |                  |   | 500,493   |  
|Construction in progress                                                                                                                                                         |  |                           | 87,683     |   |                  |   | 87,073    |  
|                                                                                                                                                                                 |  |                           |            |   |                  |   |           |  
|Total real estate assets                                                                                                                                                         |  |                           | 4,133,060  |   |                  |   | 4,132,583 |  
|Cash and cash equivalents                                                                                                                                                        |  |                           | 153,698    |   |                  |   | 102,725   |  
|Tenant receivables, net of allowance for doubtful accounts of $3,603 and $4,117 as of March 31, 2010 and December 31,
2009, respectively                                         |  |                           | 100,884    |   |                  |   | 97,679    |  
|Prepaid expenses and other assets                                                                                                                                                |  |                           | 22,947     |   |                  |   | 23,468    |  
|Deferred financing costs, less accumulated amortization of $5,321 and $4,181 as of March 31, 2010 and December 31,
2009, respectively                                            |  |                           | 5,160      |   |                  |   | 6,300     |  
|Intangible lease origination costs, less accumulated amortization of $195,915 and $184,977 as of March 31, 2010 and
December 31, 2009, respectively                              |  |                           | 294,443    |   |                  |   | 304,590   |  
|Deferred lease costs, less accumulated amortization of $12,391 and $11,072 as of March 31, 2010 and December 31, 2009,
respectively                                              |  |                           | 42,419     |   |                  |   | 42,719    |  
|Investment in development authority bonds                                                                                                                                        |  |                           | 664,000    |   |                  |   | 664,000   |  
|                                                                                                                                                                                 |  |                           |            |   |                  |   |           |  
|Total assets                                                                                                                                                                     |  | $                         | 5,416,611  |   |                  | $ | 5,374,064 |  
|                                                                                                                                                                                 |  |                           |            |   |                  |   |           |  
|Liabilities:                                                                                                                                                                     |  |                           |            |   |                  |   |           |  
|Line of credit and notes payable                                                                                                                                                 |  | $                         | 950,235    |   |                  | $ | 946,936   |  
|Accounts payable, accrued expenses, and accrued capital expenditures                                                                                                             |  |                           | 88,647     |   |                  |   | 89,312    |  
|Due to affiliates                                                                                                                                                                |  |                           | 3,035      |   |                  |   | 5,996     |  
|Distributions payable                                                                                                                                                            |  |                           | 13,443     |   |                  |   | 13,096    |  
|Deferred income                                                                                                                                                                  |  |                           | 26,499     |   |                  |   | 23,990    |  
|Intangible lease liabilities, less accumulated amortization of $52,081 and $48,552 as of March 31, 2010 and
December 31, 2009, respectively                                      |  |                           | 98,783     |   |                  |   | 101,529   |  
|Obligations under capital leases                                                                                                                                                 |  |                           | 664,000    |   |                  |   | 664,000   |  
|                                                                                                                                                                                 |  |                           |            |   |                  |   |           |  
|Total liabilities                                                                                                                                                                |  |                           | 1,844,642  |   |                  |   | 1,844,859 |  
|Commitments and Contingencies (Note 4)                                                                                                                                           |  |                           |           |   |                  |   |          |  
|Redeemable Common Stock                                                                                                                                                          |  |                           | 867,608    |   |                  |   | 805,844   |  
|Equity:                                                                                                                                                                          |  |                           |            |   |                  |   |           |  
|Common stock, $0.01 par value; 900,000,000 shares authorized; 512,950,098 and 499,895,448 shares issued and outstanding as of
March 31, 2010 and December 31, 2009, respectively |  |                           | 5,129      |   |                  |   | 4,999     |  
|Additional paid-in capital                                                                                                                                                       |  |                           | 4,578,804  |   |                  |   | 4,461,980 |  
|Cumulative distributions in excess of earnings                                                                                                                                   |  |                           | (1,008,322 | ) |                  |   | (935,019  | )
|Redeemable common stock                                                                                                                                                          |  |                           | (867,608   | ) |                  |   | (805,844  | )
|Other comprehensive loss                                                                                                                                                         |  |                           | (8,885     | ) |                  |   | (8,029    | )
|                                                                                                                                                                                 |  |                           |            |   |                  |   |           |  
|Total Wells Real Estate Investment Trust II, Inc. stockholders equity                                                                                                           |  |                           | 2,699,118  |   |                  |   | 2,718,087 |  
|Nonredeemable Noncontrolling interests                                                                                                                                           |  |                           | 5,243      |   |                  |   | 5,274     |  
|                                                                                                                                                                                 |  |                           |            |   |                  |   |           |  
|Total equity                                                                                                                                                                     |  |                           | 2,704,361  |   |                  |   | 2,723,361 |  
|                                                                                                                                                                                 |  |                           |            |   |                  |   |           |  
|Total liabilities, redeemable common stock, and equity                                                                                                                           |  | $                         | 5,416,611  |   |                  | $ | 5,374,064 |  
|                                                                                                                                                                                 |  |                           |            |   |                  |   |           |  

See accompanying notes.



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WELLS REAL ESTATE INVESTMENT TRUST II, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per-share amounts)



|                                                                       |  |                                         |         |   |      |   |         |  
|---------------------------------------------------------------------- |  | --------------------------------------- | ------- | - | ---- | - | ------- | -
|                                                                       |  | (Unaudited)Three Months 
EndedMarch 31, |        
|                                                                       |  | 2010                                    |         |   | 2009 |  
|Revenues:                                                              |  |                                         |         |   |      |   |         |  
|Rental income                                                          |  | $                                       | 107,756 |   |      | $ | 106,824 |  
|Tenant reimbursements                                                  |  |                                         | 23,364  |   |      |   | 25,871  |  
|Hotel income                                                           |  |                                         | 4,042   |   |      |   | 4,356   |  
|Other property income                                                  |  |                                         | 412     |   |      |   | 286     |  
|                                                                       |  |                                         |         |   |      |   |         |  
|                                                                       |  |                                         | 135,574 |   |      |   | 137,337 |  
|Expenses:                                                              |  |                                         |         |   |      |   |         |  
|Property operating costs                                               |  |                                         | 40,772  |   |      |   | 42,492  |  
|Hotel operating costs                                                  |  |                                         | 3,936   |   |      |   | 3,964   |  
|Asset and property management fees:                                    |  |                                         |         |   |      |   |         |  
|Related-party                                                          |  |                                         | 8,313   |   |      |   | 8,358   |  
|Other                                                                  |  |                                         | 1,001   |   |      |   | 1,024   |  
|Acquisition fees and expenses                                          |  |                                         | 3,390   |   |      |   | 8,824   |  
|Depreciation                                                           |  |                                         | 23,579  |   |      |   | 21,975  |  
|Amortization                                                           |  |                                         | 29,229  |   |      |   | 29,948  |  
|General and administrative                                             |  |                                         | 6,048   |   |      |   | 6,806   |  
|                                                                       |  |                                         |         |   |      |   |         |  
|                                                                       |  |                                         | 116,268 |   |      |   | 123,391 |  
|                                                                       |  |                                         |         |   |      |   |         |  
|Real estate operating income                                           |  |                                         | 19,306  |   |      |   | 13,946  |  
|Other income (expense):                                                |  |                                         |         |   |      |   |         |  
|Interest expense                                                       |  |                                         | (22,466 | ) |      |   | (21,822 | )
|Interest and other income                                              |  |                                         | 10,311  |   |      |   | 10,346  |  
|Loss on foreign currency exchange contract                             |  |                                         |        |   |      |   | (582    | )
|Gain (loss) on interest rate swaps                                     |  |                                         | (4,860  | ) |      |   | 4,791   |  
|                                                                       |  |                                         |         |   |      |   |         |  
|                                                                       |  |                                         | (17,015 | ) |      |   | (7,267  | )
|                                                                       |  |                                         |         |   |      |   |         |  
|Gain before income tax benefit                                         |  |                                         | 2,291   |   |      |   | 6,679   |  
|Income tax benefit                                                     |  |                                         | 236     |   |      |   | 216     |  
|                                                                       |  |                                         |         |   |      |   |         |  
|Net income                                                             |  |                                         | 2,527   |   |      |   | 6,895   |  
|Less: Net income attributable to noncontrolling interests              |  |                                         | (18     | ) |      |   | (40     | )
|                                                                       |  |                                         |         |   |      |   |         |  
|Net income attributable to Wells Real Estate Investment Trust II, Inc. |  | $                                       | 2,509   |   |      | $ | 6,855   |  
|                                                                       |  |                                         |         |   |      |   |         |  
|Per-share information  basic and diluted:                             |  |                                         |         |   |      |   |         |  
|Net income attributable to Wells Real Estate Investment Trust II, Inc. |  | $                                       | 0.00    |   |      | $ | 0.02    |  
|                                                                       |  |                                         |         |   |      |   |         |  
|Weighted-average common shares outstanding  basic and diluted         |  |                                         | 505,018 |   |      |   | 446,105 |  
|                                                                       |  |                                         |         |   |      |   |         |  

See accompanying notes.



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WELLS REAL ESTATE INVESTMENT TRUST II, INC.

CONSOLIDATED STATEMENTS OF EQUITY

FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009 (UNAUDITED)

(in thousands, except per-share amounts)



|                                                                                                  |  |                      |   |  |                    |       |   |                                      |   |           |                  |  |   |                    |   |  |                                                                |          |   |                              |   |         |           |  |   |           |   |  |   |       |   |  |   |           |  
|------------------------------------------------------------------------------------------------- |  | -------------------- | - |  | ------------------ | ----- | - | ------------------------------------ | - | --------- | ---------------- |  | - | ------------------ | - |  | -------------------------------------------------------------- | -------- | - | ---------------------------- | - | ------- | --------- |  | - | --------- | - |  | - | ----- | - |  | - | --------- | -
|                                                                                                  |  | Stockholders Equity |   |  |                    |       |   |                                      |  
|                                                                                                  |  | Common Stock         |   |  | Additional
Paid-In |       |   | CumulativeDistributions
in Excess of |   |           | RedeemableCommon |  |   | OtherComprehensive |   |  | Total Wells Real
Estate InvestmentTrust II, Inc.
Stockholders |          |   | Nonredeemable
Noncontrolling |   |         | Total     | 
|                                                                                                  |  | Shares               |   |  | Amount             |       |   | Capital                              |   |           | Earnings         |  |   | Stock              |   |  | Loss                                                           |          |   | Equity                       |   |         | Interests |  |   | Equity    |  
|Balance, December 31, 2009                                                                        |  | 499,895              |   |  | $                  | 4,999 |   |                                      | $ | 4,461,980 |                  |  | $ | (935,019           | ) |  | $                                                              | (805,844 | ) |                              | $ | (8,029  | )         |  | $ | 2,718,087 |   |  | $ | 5,274 |   |  | $ | 2,723,361 |  
|Issuance of common stock                                                                          |  | 14,836               |   |  |                    | 148   |   |                                      |   | 148,215   |                  |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   | 148,363   |   |  |   |      |   |  |   | 148,363   |  
|Redemptions of common stock                                                                       |  | (1,781               | ) |  |                    | (18   | ) |                                      |   | (17,539   | )                |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   | (17,557   | ) |  |   |      |   |  |   | (17,557   | )
|Increase in redeemable common stock                                                               |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   |                   |   |  |                                                                | (61,764  | ) |                              |   |        |           |  |   | (61,764   | ) |  |   |      |   |  |   | (61,764   | )
|Distributions to common stockholders ($0.15 per share)                                            |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   | (75,812            | ) |  |                                                                |         |   |                              |   |        |           |  |   | (75,812   | ) |  |   |      |   |  |   | (75,812   | )
|Distributions to noncontrolling interests                                                         |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   |          |   |  |   | (49   | ) |  |   | (49       | )
|Commissions and discounts on stock sales and related dealer-manager fees                          |  |                     |   |  |                    |      |   |                                      |   | (11,970   | )                |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   | (11,970   | ) |  |   |      |   |  |   | (11,970   | )
|Other offering costs                                                                              |  |                     |   |  |                    |      |   |                                      |   | (1,882    | )                |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   | (1,882    | ) |  |   |      |   |  |   | (1,882    | )
|Components of comprehensive income:                                                               |  |                      |   |  |                    |       |   |                                      |   |           |                  |  |   |                    |   |  |                                                                |          |   |                              |   |         |           |  |   |           |   |  |   |       |   |  |   |           |  
|Net income attributable to the common stockholders of Wells Real Estate Investment Trust II, Inc. |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   | 2,509              |   |  |                                                                |         |   |                              |   |        |           |  |   | 2,509     |   |  |   |      |   |  |   | 2,509     |  
|Net income attributable to noncontrolling interests                                               |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   |          |   |  |   | 18    |   |  |   | 18        |  
|Market value adjustment to interest rate swap                                                     |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   |                   |   |  |                                                                |         |   |                              |   | (856    | )         |  |   | (856      | ) |  |   |      |   |  |   | (856      | )
|                                                                                                  |  |                      |   |  |                    |       |   |                                      |   |           |                  |  |   |                    |   |  |                                                                |          |   |                              |   |         |           |  |   |           |   |  |   |       |   |  |   |           |  
|Comprehensive income                                                                              |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   | 1,653     |   |  |   | 18    |   |  |   | 1,671     |  
|                                                                                                  |  |                      |   |  |                    |       |   |                                      |   |           |                  |  |   |                    |   |  |                                                                |          |   |                              |   |         |           |  |   |           |   |  |   |       |   |  |   |           |  
|Balance, March 31, 2010                                                                           |  | 512,950              |   |  | $                  | 5,129 |   |                                      | $ | 4,578,804 |                  |  | $ | (1,008,322         | ) |  | $                                                              | (867,608 | ) |                              | $ | (8,885  | )         |  | $ | 2,699,118 |   |  | $ | 5,243 |   |  | $ | 2,704,361 |  
|                                                                                                  |  |                      |   |  |                    |       |   |                                      |   |           |                  |  |   |                    |   |  |                                                                |          |   |                              |   |         |           |  |   |           |   |  |   |       |   |  |   |           |  
|                                                                                                  |  |                      |  
|                                                                                                  |  | Stockholders Equity |   |  |                    |       |   |                                      |  
|                                                                                                  |  | Common Stock         |   |  | AdditionalPaid-In  |       |   | CumulativeDistributionsin Excess of  |   |           | RedeemableCommon |  |   | OtherComprehensive |   |  | Total Wells RealEstate InvestmentTrust II, Inc.Stockholders   |          |   | NonredeemableNoncontrolling  |   |         | Total     | 
|                                                                                                  |  | Shares               |   |  | Amount             |       |   | Capital                              |   |           | Earnings         |  |   | Stock              |   |  | Loss                                                           |          |   | Equity                       |   |         | Interests |  |   | Equity    |  
|Balance, December 31, 2008                                                                        |  | 442,009              |   |  | $                  | 4,420 |   |                                      | $ | 3,943,266 |                  |  | $ | (694,751           | ) |  | $                                                              | (661,340 | ) |                              | $ | (14,812 | )         |  | $ | 2,576,783 |   |  | $ | 5,427 |   |  | $ | 2,582,210 |  
|Issuance of common stock                                                                          |  | 16,145               |   |  |                    | 161   |   |                                      |   | 161,285   |                  |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   | 161,446   |   |  |   |      |   |  |   | 161,446   |  
|Redemptions of common stock                                                                       |  | (5,070               | ) |  |                    | (50   | ) |                                      |   | (47,162   | )                |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   | (47,212   | ) |  |   |      |   |  |   | (47,212   | )
|Increase in redeemable common stock                                                               |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   |                   |   |  |                                                                | 4,793    |   |                              |   |        |           |  |   | 4,793     |   |  |   |      |   |  |   | 4,793     |  
|Distributions to noncontrolling interests                                                         |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   |          |   |  |   | (69   | ) |  |   | (69       | )
|Distributions to common stockholders ($0.15 per share)                                            |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   | (66,978            | ) |  |                                                                |         |   |                              |   |        |           |  |   | (66,978   | ) |  |   |      |   |  |   | (66,978   | )
|Commissions and discounts on stock sales and related dealer-manager fees                          |  |                     |   |  |                    |      |   |                                      |   | (13,375   | )                |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   | (13,375   | ) |  |   |      |   |  |   | (13,375   | )
|Other offering costs                                                                              |  |                     |   |  |                    |      |   |                                      |   | (2,029    | )                |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   | (2,029    | ) |  |   |      |   |  |   | (2,029    | )
|Components of comprehensive income:                                                               |  |                      |   |  |                    |       |   |                                      |   |           |                  |  |   |                    |   |  |                                                                |          |   |                              |   |         |           |  |   |           |   |  |   |       |   |  |   |           |  
|Net income attributable to noncontrolling interests                                               |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   |          |   |  |   | 40    |   |  |   | 40        |  
|Net income attributable to Wells Real Estate Investment Trust II, Inc.                            |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   | 6,855              |   |  |                                                                |         |   |                              |   |        |           |  |   | 6,855     |   |  |   |      |   |  |   | 6,855     |  
|Foreign currency translation adjustment                                                           |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   |                   |   |  |                                                                |         |   |                              |   | (158    | )         |  |   | (158      | ) |  |   |      |   |  |   | (158      | )
|Market value adjustment to interest rate swap                                                     |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   |                   |   |  |                                                                |         |   |                              |   | 2,024   |           |  |   | 2,024     |   |  |   |      |   |  |   | 2,024     |  
|                                                                                                  |  |                      |   |  |                    |       |   |                                      |   |           |                  |  |   |                    |   |  |                                                                |          |   |                              |   |         |           |  |   |           |   |  |   |       |   |  |   |           |  
|Comprehensive income                                                                              |  |                     |   |  |                    |      |   |                                      |   |          |                  |  |   |                   |   |  |                                                                |         |   |                              |   |        |           |  |   | 8,721     |   |  |   | 40    |   |  |   | 8,761     |  
|                                                                                                  |  |                      |   |  |                    |       |   |                                      |   |           |                  |  |   |                    |   |  |                                                                |          |   |                              |   |         |           |  |   |           |   |  |   |       |   |  |   |           |  
|Balance, March 31, 2009                                                                           |  | 453,084              |   |  | $                  | 4,531 |   |                                      | $ | 4,041,985 |                  |  | $ | (754,874           | ) |  | $                                                              | (656,547 | ) |                              | $ | (12,946 | )         |  | $ | 2,622,149 |   |  | $ | 5,398 |   |  | $ | 2,627,547 |  
|                                                                                                  |  |                      |   |  |                    |       |   |                                      |   |           |                  |  |   |                    |   |  |                                                                |          |   |                              |   |         |           |  |   |           |   |  |   |       |   |  |   |           |  

See accompanying notes.



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WELLS REAL ESTATE INVESTMENT TRUST II, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)



|                                                                                  |  |                                         |         |   |      |   |         |  
|--------------------------------------------------------------------------------- |  | --------------------------------------- | ------- | - | ---- | - | ------- | -
|                                                                                  |  | (unaudited)Three months 
endedMarch 31, |        
|                                                                                  |  | 2010                                    |         |   | 2009 |  
|Cash Flows from Operating Activities:                                             |  |                                         |         |   |      |   |         |  
|Net income                                                                        |  | $                                       | 2,527   |   |      | $ | 6,895   |  
|Adjustments to reconcile net income to net cash provided by operating activities: |  |                                         |         |   |      |   |         |  
|Straight-line rental income                                                       |  |                                         | (828    | ) |      |   | (2,414  | )
|Depreciation                                                                      |  |                                         | 23,579  |   |      |   | 21,975  |  
|Amortization                                                                      |  |                                         | 30,787  |   |      |   | 31,582  |  
|Loss (gain) on interest rate swaps                                                |  |                                         | 2,534   |   |      |   | (6,885  | )
|Remeasurement loss on foreign currency                                            |  |                                         | 76      |   |      |   | 849     |  
|Loss on foreign currency exchange contract                                        |  |                                         |        |   |      |   | 582     |  
|Noncash interest expense                                                          |  |                                         | 4,608   |   |      |   | 3,769   |  
|Changes in assets and liabilities:                                                |  |                                         |         |   |      |   |         |  
|(Increase) decrease in tenant receivables, net                                    |  |                                         | (2,105  | ) |      |   | 50      |  
|(Increase) decrease in prepaid expenses and other assets                          |  |                                         | (3,506  | ) |      |   | 5,489   |  
|Decrease in accounts payable and accrued expenses                                 |  |                                         | (1,124  | ) |      |   | (2,107  | )
|Decrease in due to affiliates                                                     |  |                                         | (2,998  | ) |      |   | (4,817  | )
|Increase (decrease) in deferred income                                            |  |                                         | 2,509   |   |      |   | (2,326  | )
|                                                                                  |  |                                         |         |   |      |   |         |  
|Net cash provided by operating activities                                         |  |                                         | 56,059  |   |      |   | 52,642  |  
|Cash Flows from Investing Activities:                                             |  |                                         |         |   |      |   |         |  
|Investment in real estate and earnest money paid                                  |  |                                         | (45,009 | ) |      |   | (46,448 | )
|Deferred lease costs paid                                                         |  |                                         | (1,235  | ) |      |   | (1,112  | )
|                                                                                  |  |                                         |         |   |      |   |         |  
|Net cash used in investing activities                                             |  |                                         | (46,244 | ) |      |   | (47,560 | )
|Cash Flows from Financing Activities:                                             |  |                                         |         |   |      |   |         |  
|Proceeds from lines of credit and notes payable                                   |  |                                         |        |   |      |   | 3,206   |  
|Repayments of lines of credit and notes payable                                   |  |                                         | (546    | ) |      |   | (31,535 | )
|Distributions paid to noncontrolling interests                                    |  |                                         | (123    | ) |      |   | (69     | )
|Issuance of common stock                                                          |  |                                         | 146,140 |   |      |   | 159,750 |  
|Redemptions of common stock                                                       |  |                                         | (17,557 | ) |      |   | (47,212 | )
|Distributions paid to stockholders                                                |  |                                         | (34,898 | ) |      |   | (29,193 | )
|Distributions paid to stockholders and reinvested in shares of our common stock   |  |                                         | (40,567 | ) |      |   | (37,467 | )
|Commissions on stock sales and related dealer-manager fees paid                   |  |                                         | (9,331  | ) |      |   | (11,677 | )
|Other offering costs paid                                                         |  |                                         | (2,261  | ) |      |   | (3,652  | )
|                                                                                  |  |                                         |         |   |      |   |         |  
|Net cash provided by financing activities                                         |  |                                         | 40,857  |   |      |   | 2,151   |  
|                                                                                  |  |                                         |         |   |      |   |         |  
|Net increase in cash and cash equivalents                                         |  |                                         | 50,672  |   |      |   | 7,233   |  
|Effect of foreign exchange rate on cash and cash equivalents                      |  |                                         | 301     |   |      |   | 74      |  
|Cash and cash equivalents, beginning of period                                    |  |                                         | 102,725 |   |      |   | 86,334  |  
|                                                                                  |  |                                         |         |   |      |   |         |  
|Cash and cash equivalents, end of period                                          |  | $                                       | 153,698 |   |      | $ | 93,641  |  
|                                                                                  |  |                                         |         |   |      |   |         |  

See accompanying notes.



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WELLS REAL ESTATE INVESTMENT TRUST II, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

(unaudited)



|1. | Organization
|-- | ------------

Wells Real Estate Investment Trust II, Inc. (Wells REIT II) is a Maryland corporation that has elected to be taxed as a real
estate investment trust (REIT) for federal income tax purposes. Wells REIT II engages in the acquisition and ownership of commercial real estate properties, including properties that are under construction, are newly constructed, or have
operating histories. Wells REIT II was incorporated on July 3, 2003 and commenced operations on January 22, 2004. Wells REIT II conducts business primarily through Wells Operating Partnership II, L.P. (Wells OP II), a
Delaware limited partnership. Wells REIT II is the sole general partner of Wells OP II and possesses full legal control and authority over the operations of Wells OP II. Wells REIT II owns more than 99.9% of the equity interests in Wells OP II.
Wells Capital, Inc. (Wells Capital), the external advisor to Wells REIT II, is the sole limited partner of Wells OP II. Wells OP II acquires, develops, owns, leases, and operates real properties directly, through wholly owned
subsidiaries or through joint ventures. References to Wells REIT II herein shall include Wells REIT II and all subsidiaries of Wells REIT II, including consolidated joint ventures, Wells OP II, and Wells OP IIs direct and indirect
subsidiaries. See Note 7 for a discussion of the advisory services provided by Wells Capital.

As of March 31, 2010,
Wells REIT II owned controlling interests in 66 office properties, one industrial property, and one hotel, which include 89 operational buildings. These properties are comprised of approximately 20.9 million square feet of commercial space and
are located in 23 states, the District of Columbia, and Moscow, Russia. Of these properties, 64 are wholly owned and four are owned through consolidated joint ventures. As of March 31, 2010, the office properties and industrial property were
approximately 93.3% leased (office properties were approximately 96.0% leased).

On December 1, 2003, Wells REIT II
commenced its initial public offering of up to 785.0 million shares of common stock, of which 185.0 million shares were reserved for issuance through Wells REIT IIs dividend reinvestment plan (DRP), pursuant to a
Registration Statement filed on Form S-11 with the SEC (the Initial Public Offering). Except for continuing to offer shares for sale through its DRP, Wells REIT II stopped offering shares for sale under the Initial Public Offering on
November 26, 2005. Wells REIT II raised gross offering proceeds of approximately $2.0 billion from the sale of approximately 197.1 million shares under the Initial Public Offering, including shares sold under the DRP through March 2006. On
November 10, 2005, Wells REIT II commenced a follow-on offering of up to 300.6 million shares of common stock, of which 0.6 million shares were reserved for issuance under Wells REIT IIs DRP, pursuant to a Registration Statement
filed on Form S-11 with the SEC (the Follow-On Offering). On April 14, 2006, Wells REIT II amended the aforementioned registration statements to offer in a combined prospectus 300.6 million shares registered under the Follow-On
Offering and 174.4 million unsold shares related to the DRP originally registered under the Initial Public Offering. Wells REIT II raised gross offering proceeds of approximately $2.6 billion from the sale of approximately 257.6 million
shares under the Follow-On Offering, including shares sold under the DRP, through November 2008. Wells REIT II stopped offering shares for sale under the Follow-On Offering on November 10, 2008.

On November 11, 2008, Wells REIT II commenced a third offering of up to 375.0 million shares of common stock pursuant to a
Registration Statement filed on Form S-11 with the SEC (the Third Offering). Under the Third Offering registration statement, as amended, Wells REIT II is currently offering up to 300.0 million shares of common stock in a primary
offering for $10 per share, with discounts available to certain categories of purchasers, and up to 75.0 million shares pursuant to its DRP at a purchase price equal to the higher of $9.55 per share or 95% of the estimated value of a share of
its common stock. As of March 31, 2010, Wells REIT II had raised gross offering proceeds of approximately $0.9 billion from the sale of approximately 92.5 million shares under the Third Offering, including shares sold under the DRP.
On April 27, 2010, Wells REIT IIs board of directors elected to conclude the Third Offering effective June 30, 2010. As a result, Wells REIT II will not make offers under its current primary public offering after June 30, 2010;
however, Wells REIT II will continue to offer shares through its dividend reinvestment program.



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As of March 31, 2010, Wells REIT II had raised gross offering proceeds from the sale of
common stock under the Initial Public Offering, the Follow-On Offering, and the Third Offering of approximately $5.5 billion. After deductions from such gross offering proceeds for payments of selling commissions and dealer-manager fees of
approximately $491.0 million, acquisition fees of approximately $108.7 million, other organization and offering expenses of approximately $73.6 million, and common stock redemptions paid pursuant to our share redemption program of approximately
$343.1 million, Wells REIT II had received aggregate net offering proceeds of approximately $4.5 billion. Substantially all of Wells REIT IIs net offering proceeds have been invested in real properties and related assets. As of
March 31, 2010, approximately 231.8 million shares remain available for sale to the public under the Third Offering through June 30, 2010, exclusive of shares available under the DRP.

Wells REIT IIs stock is not listed on a public securities exchange. However, Wells REIT IIs charter requires that in the
event Wells REIT IIs stock is not listed on a national securities exchange by October 2015, Wells REIT II must either seek stockholder approval to extend or amend this listing deadline or seek stockholder approval to begin liquidating
investments and distributing the resulting proceeds to the stockholders. If Wells REIT II seeks stockholder approval to extend or amend this listing date and does not obtain it, Wells REIT II will then be required to seek stockholder approval to
liquidate. In this circumstance, if Wells REIT II seeks and does not obtain approval to liquidate, Wells REIT II will not be required to list or liquidate and could continue to operate indefinitely as an unlisted company.



|2. | Summary of Significant Accounting Policies
|-- | ------------------------------------------

Basis of Presentation

The consolidated financial statements of Wells REIT II have been prepared in accordance with the rules and regulations of the SEC,
including the instructions to Form 10-Q and Article 10 of Regulation S-X, and do not include all of the information and footnotes required by U.S. generally accepted accounting principles (GAAP) for complete financial statements. In the
opinion of management, the statements for these unaudited interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair and consistent presentation of the results for such periods. Results for
these interim periods are not necessarily indicative of a full years results. Wells REIT IIs consolidated financial statements include the accounts of Wells REIT II, Wells OP II, and any variable interest entity in which Wells REIT II or
Wells OP II was deemed the primary beneficiary. For further information, refer to the financial statements and footnotes included in Wells REIT IIs Annual Report on Form 10-K for the year ended December 31, 2009.

Redeemable Common Stock

Wells REIT IIs share redemption program (the SRP) requires Wells REIT II to honor all redemption requests made within
two years following the death of a stockholder. As of March 31, 2010 and December 31, 2009, Wells REIT II had an insurance-backed source of funding for the redemption of shares under its share redemption program in the event Wells
REIT II received an unusually large number of redemption requests due to the death of its investors. As the decision to honor redemptions sought within two years following the death of a stockholder was outside of the control of Wells REIT II
and an insurance agreement provided Wells REIT II with the ability to fund all of such redemptions, Wells REIT II recorded redeemable common stock in the temporary equity section of the accompanying consolidated balance sheets equal to the present
value of the future estimated deductible amounts under the insurance agreement for all periods presented. In addition, Wells REIT II is required to honor certain other redemptions up to the amount of proceeds raised in the current calendar year
under the DRP. Accordingly, the amount of proceeds raised under the DRP, less redemptions funded in the current calendar year, is also recorded as redeemable common stock in the temporary equity section of the accompanying consolidated balance
sheets.

Effective April 30, 2010, Wells REIT II (i) amended the SRP to limit all redemptions during any calendar
year, including those sought within two years of a stockholders death, to those that can be funded from 100% of the net proceeds from the DRP during that calendar year, and (ii) terminated of the insurance-backed funding agreement
described above. As a result, effective April 30, 2010, Wells REIT II will only record redeemable common stock for the amount of proceeds raised under the DRP, less redemptions tendered for redemption in the current calendar year.



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Interest Rate Swap Agreements

Wells REIT II enters into interest rate swap contracts to mitigate its interest rate risk on the related financial instruments. Wells REIT
II does not enter into derivative or interest rate transactions for speculative purposes; however, certain of its derivatives may not qualify for hedge accounting treatment. Wells REIT II records the fair value of its interest rate swaps either as
prepaid expenses and other assets or as accounts payable, accrued expenses, and accrued capital expenditures. Changes in the fair value of the effective portion of interest rate swaps that are designated as hedges are recorded as other comprehensive
income (loss), while changes in the fair value of the ineffective portion of a hedge, if any, is recognized currently in earnings. Changes in the fair value of interest rate swaps that do not qualify for hedge accounting treatment are recorded as
gain (loss) on interest rate swaps. Amounts received or paid under interest rate swap agreements are recorded as interest expense for contracts that qualify for hedge accounting treatment and as gain (loss) on interest rate swaps for contracts that
do not qualify for hedge accounting treatment.

The following tables provide additional information related to Wells REIT
IIs interest rate swaps as of March 31, 2010 and December 31, 2009 (in thousands):



|                                                   |  |                              |  |                            |        |                  |   |       
|-------------------------------------------------- |  | ---------------------------- |  | -------------------------- | ------ | ---------------- | - | ------
|                                                   |  |                              |  | Estimated Fair Value as of
|Instrument Type                                    |  | Balance Sheet Classification |  | March 31,2010              |        | December 31,2009
|Derivatives designated as hedging instruments:     |  |                              |  |                            |        |                 
|Interest rate contracts                            |  | Accounts payable             |  | $                          | 8,968  |                  | $ | 8,112 
|                                                   |  |                             
|Derivatives not designated as hedging instruments: |  |                              |  |                            |        |                 
|Interest rate contracts                            |  | Accounts payable             |  | $                          | 30,257 |                  | $ | 27,723



|                                                                                                                          |  |                             |        |   |      |   |      
|------------------------------------------------------------------------------------------------------------------------- |  | --------------------------- | ------ | - | ---- | - | -----
|                                                                                                                          |  | Three Months EndedMarch 31,
|                                                                                                                          |  | 2010                        |        |   | 2009
|Market value adjustment to interest rate swap designated as a hedge instrument and included in other comprehensive
income |  | $                           | (856   | ) |      | $ | 2,024
|                                                                                                                          |  |                             |        |   |      |   |      
|                                                                                                                          |  |                            
|Gain (loss) on interest rate swaps recognized through earnings                                                            |  | $                           | (4,860 | ) |      | $ | 4,791
|                                                                                                                          |  |                             |        |   |      |   |      

During the periods presented, Wells REIT II did not
(i) reclassify any portion of unrecognized losses in other comprehensive income to earnings, or (ii) recognize gains (losses) for the ineffective portion of swaps that qualify for hedge accounting treatment.

For additional information about Wells REIT IIs interest rate swap contracts, see Part I, Item 3. Quantitative and
Qualitative Disclosures About Market Risk.

Foreign Currency Exchange Contract

On October 2, 2007, Wells REIT II entered into a foreign currency exchange contract to hedge its exposure to fluctuations in the U.S.
dollar to Russian rouble exchange rate in connection with a Russian rouble denominated contract to purchase Dvintsev Business Center  Tower B upon completion of construction. This contract did not qualify for hedge accounting treatment;
accordingly, its estimated fair value was adjusted through earnings until it was settled on April 1, 2009 with a payment of approximately $8.2 million to the counterparty.



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Foreign Currency Measurement

Wells REIT IIs Russian subsidiary uses the U.S. dollar as its functional currency and, accordingly, maintains its books and
records in U.S. dollars. Gains or losses may result from remeasuring cash or debt denominated in currencies other than our functional currency, and from transactions executed in currencies other than our functional currency due to a difference in
the exchange rate in place when the transaction is initiated and the exchange rate in place when the transaction is settled. Such remeasurement gains or losses are included in general and administrative expenses in the accompanying consolidated
statements of operations.

Prior to July 1, 2009, Wells REIT IIs Russian subsidiary used the Russian rouble as its
functional currency and, accordingly, maintained its books and records in Russian roubles. During this period, Wells REIT IIs Russian subsidiary translated its assets and liabilities into U.S. dollars at the exchange rate in place as of the
balance sheet date, and translated its revenues and expenses into U.S. dollars at the average exchange rate for the periods presented. Net exchange gains or losses resulting from the translation of these financial statements from Russian roubles to
U.S. dollars were recorded in other comprehensive loss in the accompanying consolidated statements of equity through June 30, 2009.

Fair Value Measurements

Wells REIT II estimates the fair value of its assets and liabilities (where currently required under GAAP) consistent with the provisions
of the accounting standard for fair value measurements and disclosures, which became effective for financial assets and liabilities on January 1, 2008. Under this standard, fair value is defined as the price that would be received upon
sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date. While various techniques and assumptions can be used to estimate fair value depending on the nature of the
asset or liability, the accounting standard for fair value measurements and disclosures provides the following fair value technique parameters and hierarchy, depending upon availability:

Level 1  Assets or liabilities for which the identical term is traded on an active exchange, such as publicly traded
instruments or futures contracts.

Level 2  Assets and liabilities valued based on observable market data
for similar instruments.

Level 3  Assets or liabilities for which significant valuation assumptions are
not readily observable in the market. Such assets or liabilities are valued based on the best available data, some of which may be internally developed. Significant assumptions may include risk premiums that a market participant would consider.

Wells REIT II records its interest rate swaps at fair value estimated using level 2 techniques and assumptions, as defined
above. The fair value of Wells REIT IIs interest rate swaps were $39.2 million and $35.8 million at March 31, 2010 and December 31, 2009, respectively. Please refer to the Interest Rate Swap Agreements disclosure above for
additional details.

Income Taxes

Wells REIT II has elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (the Code), and has
operated as such beginning with its taxable year ended December 31, 2003. To qualify as a REIT, Wells REIT II must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of its REIT taxable
income, as defined by the Code, to its stockholders. As a REIT, Wells REIT II generally is not subject to income tax on income it distributes to stockholders. Wells REIT II is subject to certain state and local taxes related to the operations of
properties in certain locations, which have been provided for in the accompanying consolidated financial statements.

Wells
TRS II, LLC (Wells TRS) is a wholly owned subsidiary of Wells REIT II and is organized as a Delaware limited liability company and operates, among other things, a full-service hotel. Wells REIT II has elected to treat Wells TRS as a
taxable REIT subsidiary. Wells REIT II may perform certain additional, noncustomary services for tenants of its buildings through Wells TRS; however, any earnings related to such services are subject to federal and state income taxes.



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In addition, for Wells REIT II to continue to qualify as a REIT, Wells REIT II must limit its investments in taxable REIT subsidiaries to 25% of the value of the total assets of Wells REIT II for
2010. Deferred tax assets and liabilities represent temporary differences between the financial reporting basis and the tax basis of assets and liabilities based on the enacted rates expected to be in effect when the temporary differences reverse.
Wells REIT II records interest and penalties related to uncertain tax positions as general and administrative expense in the accompanying consolidated statements of operations.

Recent Accounting Pronouncements

In January 2010, the Financial Accounting Standards Board (the FASB) clarified previously issued GAAP and issued new
requirements related to ASC Topic Fair Value Measurements and Disclosures (ASC 820). The clarification component includes disclosures about inputs and valuation techniques used in determining fair value, and providing fair value
measurement information for each class of assets and liabilities. The new requirements relate to disclosures of transfers between the levels in the fair value hierarchy, as well as the individual components in the rollforward of the lowest level
(Level 3) in the fair value hierarchy. This change in GAAP was effective for Wells REIT II beginning January 1, 2010, except for the provision concerning the rollforward of activity of the Level 3 fair value measurement, which will become
effective for Wells REIT II on January 1, 2011. The adoption of ASC 820 did not have a material impact on Wells REIT IIs consolidated financial statements or disclosures.



|3. | Real Estate Acquisitions
|-- | ------------------------

Summary

As of
March 31, 2010, Wells REIT II owned interests in 68 properties as a result of acquiring the property described below in the first quarter of 2010 and acquiring 67 properties in prior periods.

Sterling Commerce Center

On March 8, 2010, Wells REIT II acquired four office buildings containing approximately 323,000 rentable square feet and located in
Columbus, Ohio (the Sterling Commerce Buildings) for $36.6 million, exclusive of closing costs. The Sterling Commerce Buildings are entirely leased to Sterling Commerce, a wholly owned subsidiary of AT&T, Inc., under a 10-year lease.



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|4. | Line of Credit and Notes Payable
|-- | --------------------------------

As of March 31, 2010 and December 31, 2009, Wells REIT II had the following indebtedness outstanding (in thousands):



|                                                  |  |               |         |                   |   |        
|------------------------------------------------- |  | ------------- | ------- | ----------------- | - | -------
|Facility                                          |  | March 31,2010 |         | December 
31,2009
|222 E.
41stStreet Building mortgage note          |  | $             | 155,700 |                   | $ | 153,130
|100 East Pratt Street Building mortgage note      |  |               | 105,000 |                   |   | 105,000
|Wildwood Buildings mortgage note                  |  |               | 90,000  |                   |   | 90,000 
|5 Houston Center Building mortgage note           |  |               | 90,000  |                   |   | 90,000 
|Manhattan Towers Building mortgage note           |  |               | 75,000  |                   |   | 75,000 
|Cranberry Woods Drive mortgage note               |  |               | 63,396  |                   |   | 63,396 
|80 Park Plaza Building mortgage note              |  |               | 57,930  |                   |   | 56,978 
|263 Shuman Boulevard Building mortgage note       |  |               | 49,000  |                   |   | 49,000 
|800 North Frederick Building mortgage note        |  |               | 46,400  |                   |   | 46,400 
|One West Fourth Street Building mortgage note     |  |               | 42,950  |                   |   | 43,408 
|SanTan Corporate Center mortgage notes            |  |               | 39,000  |                   |   | 39,000 
|Highland Landmark Building mortgage note          |  |               | 33,840  |                   |   | 33,840 
|Three Glenlake Building mortgage note             |  |               | 25,485  |                   |   | 25,414 
|One and Four Robbins Road Buildings mortgage note |  |               | 23,000  |                   |   | 23,000 
|215 Diehl Road Building mortgage note             |  |               | 21,000  |                   |   | 21,000 
|1580 West Nursery Road Buildings mortgage note    |  |               | 19,573  |                   |   | 19,786 
|Bank Zenit loan (11.61%)                          |  |               | 6,831   |                   |   | 6,633  
|Bank Zenit loan (14.00%)                          |  |               | 6,130   |                   |   | 5,951  
|                                                  |  |               |         |                   |   |        
|Total indebtedness                                |  | $             | 950,235 |                   | $ | 946,936
|                                                  |  |               |         |                   |   |        

As of March 31, 2010, Wells REIT II was in
compliance with the restrictive covenants on its outstanding debt obligations.

During the three months ended
March 31, 2010 and 2009, Wells REIT II made interest payments of approximately $10.8 million and $10.4 million, respectively, including amounts capitalized of approximately $0.5 million and $0.3 million, respectively.

As of March 31, 2010 and December 31, 2009, the estimated fair value of Wells REIT IIs line of credit and notes payable
was approximately $939.3 million and $907.7 million, respectively. Wells REIT II estimated the fair value of its line of credit by obtaining estimates for similar facilities from multiple lenders as of the respective reporting dates. The fair values
of all other debt instruments were estimated based on discounted cash flow analyses using the current incremental borrowing rates for similar types of borrowing arrangements as of the respective reporting dates. The discounted cash flow method of
assessing fair value results in a general approximation of value, and such value may never actually be realized.

Please refer to Note 8.
Subsequent Events regarding the replacement of our line of credit in May 2010.



|5. | Commitments and Contingencies
|-- | -----------------------------

Properties Under Construction

Wells REIT II engaged an unrelated third party to construct three interconnected office buildings comprised of approximately 824,000
rentable square feet and located in Cranberry, Pennsylvania (the Cranberry Woods Development Project) for approximately $195.7 million, excluding capitalized interest expense. The first phase of the Cranberry Woods Development Project
was completed in May 2009. The second and final phase of the Cranberry Woods Development Project entails two structures containing approximately 400,000 rentable square feet and is estimated to be completed in 2010. Upon completion of construction,
the Cranberry Woods Development Project will be 100% leased to



14



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##### Table of Contents

Westinghouse Electric Company, LLC at rental rates to be determined based on total construction costs. As of March 31, 2010, Wells REIT II had incurred and capitalized costs related to the
second phase of the Cranberry Woods Development Project of approximately $95.6 million and estimates incurring additional costs of approximately $0.8 million to complete the project, net of anticipated reimbursements from the tenant for
construction overruns.

Commitments Under Existing Lease Agreements

Certain lease agreements include provisions that, at the option of the tenant, may obligate Wells REIT II to expend capital to expand an
existing property or provide other expenditures for the benefit of the tenant. As of March 31, 2010, no tenants have exercised such options that had not been materially satisfied.

Litigation

From time to
time, Wells REIT II is party to legal proceedings, which arise in the ordinary course of its business. Wells REIT II is not currently involved in any legal proceedings of which management would consider the outcome to be reasonably likely to have a
material adverse effect on the results of operations or financial condition of Wells REIT II. Wells REIT II is not aware of any such legal proceedings contemplated by governmental authorities.



|6. | Supplemental Disclosures of Noncash Investing and Financing Activities
|-- | ----------------------------------------------------------------------

Outlined below are significant noncash investing and financing transactions for the three months ended March 31, 2010 and 2009 (in
thousands):



|                                                                                            |  |                             |        |   |      |   |        |  
|------------------------------------------------------------------------------------------- |  | --------------------------- | ------ | - | ---- | - | ------ | -
|                                                                                            |  | Three months endedMarch 31, |       
|                                                                                            |  | 2010                        |        |   | 2009 |  
|Other liabilities assumed upon acquisition of properties                                    |  | $                           | 617    |   |      | $ |       |  
|                                                                                            |  |                             |        |   |      |   |        |  
|Noncash interest accruing into notes payable                                                |  | $                           | 3,593  |   |      | $ | 3,355  |  
|                                                                                            |  |                             |        |   |      |   |        |  
|Market value adjustment to interest rate swap that qualifies for hedge accounting treatment |  | $                           | (856   | ) |      | $ | 2,024  |  
|                                                                                            |  |                             |        |   |      |   |        |  
|Accrued capital expenditures and deferred lease costs                                       |  | $                           | 2,205  |   |      | $ | 10,741 |  
|                                                                                            |  |                             |        |   |      |   |        |  
|Acquisition fees due to affiliate                                                           |  | $                           | 196    |   |      | $ |       |  
|                                                                                            |  |                             |        |   |      |   |        |  
|Commissions on stock sales and related dealer-manager fees due to affiliate                 |  | $                           | 469    |   |      | $ | 1,136  |  
|                                                                                            |  |                             |        |   |      |   |        |  
|Other offering costs due to affiliate                                                       |  | $                           | 725    |   |      | $ | 592    |  
|                                                                                            |  |                             |        |   |      |   |        |  
|Distributions payable to stockholders                                                       |  | $                           | 13,443 |   |      | $ | 11,877 |  
|                                                                                            |  |                             |        |   |      |   |        |  
|Discounts applied to issuance of common stock                                               |  | $                           | 2,223  |   |      | $ | 1,696  |  
|                                                                                            |  |                             |        |   |      |   |        |  
|Increase (decrease) in redeemable common stock                                              |  | $                           | 61,764 |   |      | $ | (4,793 | )
|                                                                                            |  |                             |        |   |      |   |        |  



|7. | Related-Party Transactions and Agreements
|-- | -----------------------------------------

Advisory Agreement

Wells
REIT II and Wells Capital are party to an advisory agreement (the Advisory Agreement). As in effect at March 31, 2010, the Advisory Agreement provides that Wells Capital receives the following fees and reimbursements:



| |  |  | Reimbursement of organization and offering costs paid by Wells Capital on behalf of Wells REIT II, not to exceed 2.0% of gross offering proceeds;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------



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##### Table of Contents

| |  |  | Acquisition fees of 2.0% of gross offering proceeds, subject to certain limitations; Wells REIT II also reimburses Wells Capital for expenses it
pays to third parties in connection with acquisitions or potential acquisitions;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Monthly asset management fees equal to one-twelfth of 0.625% of the cost of (i) all properties of Wells REIT II (other than those that fail to
meet specified occupancy thresholds) and (ii) investments in joint ventures until the monthly payment equals $2,708,333.33 (or $32.5 million annualized). The monthly payment remains capped at that amount until the cost of (i) all
properties of Wells REIT II (other than those that fail to meet specified occupancy thresholds) and (ii) investments in joint ventures is at least $6.5 billion, after which the monthly asset management fee will equal one-twelfth of 0.5% of the
cost of (i) all properties of Wells REIT II (other than those that fail to meet specified occupancy thresholds) and (ii) investments in joint ventures. However, the asset management fee related to the Lindbergh Center Buildings, which were
acquired July 1, 2008, was immediately 0.5%. The amount of asset management fees paid in any three-month period is limited to 0.25% of the average of the preceding three months net asset value calculations less Wells REIT IIs
outstanding debt;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Reimbursement for all costs and expenses Wells Capital incurs in fulfilling its duties as the asset portfolio manager, including (i) wages and
salaries and other employee-related expenses of Wells Capitals employees, who perform a full range of real estate services for Wells REIT II, including management, administration, operations, and marketing, and are billed to Wells REIT II
based on the amount of time spent on Wells REIT II by such personnel, provided that such expenses are not reimbursed if incurred in connection with services for which Wells Capital receives a disposition fee (described below) or an acquisition fee,
and (ii) amounts paid for IRA custodial service costs allocated to Wells REIT II accounts;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | For any property sold by Wells REIT II, other than part of a bulk sale of assets, as defined, a disposition fee equal to 1.0% of the
sales price, with the limitation that the total real estate commissions (including such disposition fee) for any Wells REIT II property sold may not exceed the lesser of (i) 6.0% of the sales price of each property or (ii) the level of
real estate commissions customarily charged in light of the size, type, and location of the property;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Incentive fee of 10% of net sales proceeds remaining after stockholders have received distributions equal to the sum of the stockholders
invested capital plus an 8% return of invested capital, which fee is payable only if the shares of common stock of Wells REIT II are not listed on an exchange; and
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Listing fee of 10% of the amount by which the market value of the stock plus distributions paid prior to listing exceeds the sum of 100% of the
invested capital plus an 8% return on invested capital, which fee will be reduced by the amount of any incentive fees paid as described in the preceding bullet.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Either party may terminate the Advisory Agreement without cause or penalty upon providing 60 days prior written notice to the
other. Under the terms of the Advisory Agreement, Wells REIT II is required to reimburse Wells Capital for certain organization and offering costs up to the lesser of actual expenses or 2% of gross equity proceeds raised. As of March 31, 2010,
Wells REIT II has incurred and charged to additional paid-in capital cumulative other offering costs of approximately $31.7 million related to the Initial Public Offering, $28.8 million related to the Follow-On Offering, and
$13.1 million related to the Third Offering, which represents approximately 1.6%, 1.1%, and 1.4% of cumulative gross proceeds raised by Wells REIT II under each offering, respectively.

Dealer-Manager Agreement

Wells REIT II is party to a dealer-manager agreement (the Dealer-Manager Agreement) with Wells Investment Securities, Inc.
(WIS), whereby WIS, an affiliate of Wells Capital, performs the dealer-manager function for Wells REIT II. For these services, WIS earns a commission of up to 7% of the gross offering proceeds from the sale of the shares of Wells REIT
II, of which substantially all is re-allowed to participating broker dealers. Wells REIT II pays no commissions on shares issued under its DRP.

Additionally, Wells REIT II is required to pay WIS a dealer-manager fee of 2.5% of the gross offering proceeds from the sale of Wells
REIT IIs stock at the time the shares are sold. Under the Dealer-Manager Agreement, up to 1.5% of the gross offering proceeds may be re-allowed by WIS to participating broker dealers. Wells REIT II pays no dealer-manager fees on shares issued
under its DRP.



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##### Table of Contents

Property Management, Leasing, and Construction Agreement

Wells REIT II and Wells Management Company (Wells Management), an affiliate of Wells Capital, are party to a Master Property
Management, Leasing, and Construction Agreement (the Management Agreement) under which Wells Management receives the following fees and reimbursements in consideration for supervising the management, leasing, and construction of certain
Wells REIT II properties:



| |  |  | Property management fees in an amount equal to a percentage negotiated for each property managed by Wells Management of the gross monthly income
collected for that property for the preceding month;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Leasing commissions for new, renewal, or expansion leases entered into with respect to any property for which Wells Management serves as leasing
agent equal to a percentage as negotiated for that property of the total base rental and operating expenses to be paid to Wells REIT II during the applicable term of the lease, provided, however, that no commission shall be payable as to any portion
of such term beyond ten years;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Initial lease-up fees for newly constructed properties under the agreement, generally equal to one months rent;
| | - |  | ----------------------------------------------------------------------------------------------------------------



| |  |  | Fees equal to a specified percentage of up to 5% of all construction build-out funded by Wells REIT II, given as a leasing concession, and overseen
by Wells Management; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Other fees as negotiated with the addition of each specific property covered under the agreement.
| | - |  | -------------------------------------------------------------------------------------------------

Related-Party Costs

Pursuant to the terms of the agreements described above, Wells REIT II incurred the following related-party costs for the three months
ended March 31, 2010 and 2009, respectively (in thousands):



|                                         |  |                             |        |      |   |       
|---------------------------------------- |  | --------------------------- | ------ | ---- | - | ------
|                                         |  | Three Months EndedMarch 31,
|                                         |  | 2010                        |        | 2009
|Commissions, net of
discounts(1)(2)      |  | $                           | 7,267  |      | $ | 8,536 
|Asset management fees                    |  |                             | 7,402  |      |   | 7,428 
|Dealer-manager fees, net of
discounts(1) |  |                             | 2,480  |      |   | 3,143 
|Administrative reimbursements,
net(3)    |  |                             | 3,112  |      |   | 2,857 
|Acquisition
fees(4)                      |  |                             | 2,924  |      |   | 3,196 
|Other offering
costs(1)                  |  |                             | 1,882  |      |   | 2,029 
|Property management fees                 |  |                             | 911    |      |   | 930   
|Construction
fees(5)                     |  |                             | 77     |      |   | 128   
|                                         |  |                             |        |      |   |       
|Total                                    |  | $                           | 26,055 |      | $ | 28,247
|                                         |  |                             |        |      |   |       



|(1) | Commissions, dealer-manager fees, and other offering costs are charged against equity as incurred.
|--- | --------------------------------------------------------------------------------------------------



|(2) | Substantially all commissions were re-allowed to participating broker/dealers during the three months ended March 31, 2010 and 2009.
|--- | ------------------------------------------------------------------------------------------------------------------------------------



|(3) | Administrative reimbursements are presented net of reimbursements from tenants of approximately $0.6 million for each of the three month
periods ended March 31, 2010 and 2009.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(4) | Costs incurred in connection with real estate acquisitions, including acquisition fees payable to our advisor Wells Capital, are expensed as
incurred.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------



|(5) | Construction fees are capitalized to real estate assets as incurred.
|--- | --------------------------------------------------------------------



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##### Table of Contents

Wells REIT II incurred no related-party disposition fees, incentive fees, listing fees, or
leasing commissions during the three months ended March 31, 2010 and 2009, respectively.

Due to Affiliates

The detail of amounts due to affiliates is provided below as of March 31, 2010 and December 31, 2009 (in thousands):



|                                                                                |  |               |       |                  |   |      
|------------------------------------------------------------------------------- |  | ------------- | ----- | ---------------- | - | -----
|                                                                                |  | March 31,2010 |       | December 31,2009
|Administrative reimbursements due to Wells Capital and/or Wells Management      |  | $             | 1,311 |                  | $ | 1,893
|Other offering cost reimbursements due to Wells Capital                         |  |               | 725   |                  |   | 1,104
|Commissions and dealer-manager fees due to WIS                                  |  |               | 469   |                  |   | 53   
|Asset and property management fees due to Wells Capital and/or Wells Management |  |               | 334   |                  |   | 2,751
|Acquisition fees due to Wells Capital                                           |  |               | 196   |                  |   | 195  
|                                                                                |  |               |       |                  |   |      
|                                                                                |  | $             | 3,035 |                  | $ | 5,996
|                                                                                |  |               |       |                  |   |      

Economic Dependency

Wells REIT II has engaged Wells Capital and its affiliates, Wells Management and WIS, to provide certain services that are essential to
Wells REIT II, including asset management services, supervision of the property management and leasing of some properties owned by Wells REIT II, asset acquisition and disposition services, the sale of shares of Wells REIT IIs common
stock, as well as other administrative responsibilities for Wells REIT II, including accounting services, stockholder communications, and investor relations. As a result of these relationships, Wells REIT II is dependent upon Wells Capital, Wells
Management, and WIS.

Wells Capital, Wells Management, and WIS are owned and controlled by Wells Real Estate Funds, Inc.
(WREF). The operations of Wells Capital, Wells Management, and WIS represent substantially all of the business of WREF. Accordingly, Wells REIT II focuses on the financial condition of WREF when assessing the financial condition of Wells
Capital, Wells Management, and WIS. In the event that WREF were to become unable to meet its obligations as they become due, Wells REIT II might be required to find alternative service providers.

Future net income generated by WREF will be largely dependent upon the amount of fees earned by Wells Capital and Wells Management based
on, among other things, the level of investor proceeds raised and the volume of future acquisitions and dispositions of real estate assets by Wells REIT II and other WREF-sponsored programs, as well as distribution income earned from equity
interests in another REIT. As of March 31, 2010, Wells REIT II believes that WREF is generating adequate cash flow from operations and has additional liquidity available in the form of cash on hand and other investments necessary to meet its
current and future obligations as they become due.



|8. | Subsequent Events
|-- | -----------------

Wells REIT II has evaluated subsequent events in conjunction with the preparation of its consolidated financial statements and notes
thereto included in this report on Form 10-Q and notes the following items:

Property Acquisition

On April 1, 2010, Wells REIT II purchased two three-story office buildings with approximately 490,000 rentable square feet located at
550 King Street, Littleton, Massachusetts (the 550 King Street Building) for approximately $94.0 million, exclusive of closing costs. The 550 King Street Building is leased entirely to International Business Machines Corporation under a
10-year lease.



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##### Table of Contents

Status of the Public Offering

On April 27, 2010, Wells REIT IIs board of directors elected to conclude the Third Offering effective June 30, 2010. As a
result, Wells REIT II will not make offers under its current primary public offering after June 30, 2010; however, Wells REIT II will continue to offer shares through its dividend reinvestment program. From April 1, 2010 through
April 30, 2010, Wells REIT II raised approximately $32.8 million through the issuance of approximately 3.3 million shares of common stock under the Third Offering. As of April 30, 2010, approximately 228.6 million shares remained
available for sale to the public under the Third Offering through June 30, 2010, exclusive of shares available under the DRP.

Corporate Credit Rating

In connection with evaluating various borrowing arrangements to replace the line of credit agreement in place with Wachovia Bank,
N.A./Wells Fargo Bank, N.A. as lead agent as of March 31, 2010, Wells REIT II sought a credit rating from Moodys Investors Service and Standard and Poors Ratings Services. As a result of obtaining an investment-grade rating from
both agencies in April 2010, Wells REIT II believes it was able to garner broader participation from prospective lenders and to achieve lower pricing on the replacement credit facility described below.

Replacement Credit Facility

On May 7, 2010, Wells REIT II entered into a $500.0 million, three-year, unsecured revolving credit facility with a syndicate of
lenders led by JPMorgan Chase Bank, N.A. as administrative agent (the JPMorgan Chase Credit Facility) to replace the $245.0 million unsecured revolving financing facility with Wachovia Bank, N.A./Wells Fargo Bank, N.A., which was
scheduled to mature on May 7, 2010.

The JPMorgan Chase Credit Facility provides for interest to be incurred based on, at
the option of Wells REIT II, the London Interbank Offered Rate (LIBOR) for one-, two-, three- or six-month periods, plus an applicable margin ranging from 2.60% to 3.40% (the LIBOR Rate), or at an alternate base rate, plus an
applicable margin ranging from 1.60% to 2.40% (the Base Rate). The base rate for any day is the greatest of (1) the rate of interest publicly announced by JPMorgan Chase Bank, N.A. as its prime rate in effect in its principal office
in New York City for such day; (2) the federal funds rate for such day plus 0.50%; or (3) the one-month LIBOR Rate, for such day plus 1.00%. The margin component of the LIBOR Rate and the Base Rate is determined based on Wells REIT
IIs corporate credit rating, as long as it has such a rating, or on Wells REIT IIs leverage ratio, as defined, if it does not have a corporate credit rating. Additionally, Wells REIT II will incur a facility fee on the aggregate
revolving commitment ranging from 0.40% to 0.60% per annum, which is also determined based on Wells REIT IIs corporate credit rating, as long as it has such a rating, or on its leverage ratio, if it does not have a corporate credit
rating.

Under the JPMorgan Chase Credit Facility, interest on LIBOR Rate loans is payable in arrears on the last day of each
interest period; interest on Base Rate loans is payable in arrears, on the first day of each month. Wells REIT II is required to repay all outstanding principal balances and accrued interest by May 7, 2013. Further, Wells REIT II is subject to
certain restrictive and financial covenants under the JPMorgan Chase Credit Facility, including a $25.0 million limitation on letters of credit that may be issued under the JPMorgan Chase Credit Facility.



|ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|------- | -------------------------------------------------------------------------------------

The following discussion and analysis should be read in conjunction with our accompanying consolidated financial statements and notes
thereto. See also Cautionary Note Regarding Forward-Looking Statements preceding Part I, as well as our consolidated financial statements and the notes thereto and Managements Discussion and Analysis of Financial Condition and
Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2009.



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##### Table of Contents

Overview

During the periods presented, we have continued to receive investor proceeds under our public offerings and to invest those proceeds in
real estate assets and to repay borrowings. These activities impact fluctuations in the results of our property operations and in interest expense.

Liquidity and Capital Resources

Overview

We have
continued to raise funds through the sale of our common stock under our public offerings and have invested the majority of those proceeds in real properties. We anticipate receiving additional proceeds from the sale of our common stock under
our current primary public offering through June 30, 2010, and proceeds from our dividend reinvestment program and using such proceeds, in combination with debt proceeds and cash on hand, to invest in future acquisitions of real property. To
the extent that timing differences arise between the rate at which we raise capital through the sale of our common stock and the rate at which we are able to acquire suitable real estate investment opportunities, we may use equity proceeds to repay
amounts outstanding on our line of credit or on other borrowings. We expect that our primary source of future operating cash flows will be cash generated from the operations of the properties currently in our portfolio and those to be acquired in
the future. The amount of future distributions to be paid to our stockholders will be dependent upon the amount of cash generated from our operating activities, how quickly we are able to invest proceeds from the sale of our common stock in quality
income-producing assets, our expectations of future cash flows, and our determination of near-term cash needs for capital improvements, tenant re-leasing, redemptions of our common stock, and debt repayments.

Short-term Liquidity and Capital Resources

During the three months ended March 31, 2010, we generated net cash flows from operating activities of $56.0 million, which
consists primarily of receipts of rental payments, tenant reimbursements, hotel room fees, and interest earned on cash balances, reduced by payments for operating costs, interest expense, asset and property management fees, general and
administrative expenses, and acquisition fees and expenses. Along with cash on hand, net cash flows from operating activities were used to fund distributions to stockholders of approximately $75.5 million during the three months ended
March 31, 2010. We expect to use the majority of our future net cash flow from operating activities to fund distributions to stockholders as well. Please refer to the Distributions section below for additional information
regarding the sources of cash used to fund future distributions to stockholders.

During the three months ended March 31,
2010, we generated net proceeds from the sale of common stock under our current public offering, net of commissions, dealer-manager fees, and acquisition fees, offering cost reimbursements, and share redemptions of $114.1 million, of which $45.0
million was used to fund investments in new and existing properties. We are actively pursuing real estate investment opportunities and intend to use offering proceeds generated from the sale of common stock under the Third Offering through
June 30, 2010, cash on hand and additional borrowings on our line of credit or from new mortgages to fund additional real estate investments. On April 27, 2010, our board of directors elected to conclude the Third Offering effective
June 30, 2010. As a result, we will not make offers under our current primary public offering after June 30, 2010; however, we will continue to offer shares through our dividend reinvestment program. As of April 30, 2010,
approximately 228.6 million shares remain available for sale under the Third Offering through June 30, 2010, exclusive of shares available under the DRP.

As of March 31, 2010, we had access to the full borrowing capacity under our line of credit with Wachovia Bank N.A./Wells Fargo Bank
N.A. of $245.0 million. Effective May 7, 2010, we replaced our line of credit with a $500.0 million, three-year replacement credit facility led by JPMorgan Chase Bank, N.A. Please refer to Note 8. Subsequent Events in the
accompanying consolidated financial statements for additional details on the replacement credit facility.



20



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##### Table of Contents

Long-term Liquidity and Capital Resources

Over the long term, we expect that our primary sources of capital will include operating cash flows, proceeds from our dividend
reinvestment program, proceeds from secured or unsecured borrowings from third-party lenders, and, if and when deemed appropriate, proceeds from strategic property sales. We expect that our primary uses of capital will be for property acquisitions,
either directly or through investments in joint ventures, tenant improvements, repaying or refinancing debt, offering-related costs, operating expenses, interest expense, distributions, and redemptions of shares of our common stock under our share
redemption program.

In determining how and when to allocate cash resources, we initially consider the source of the
cash. We expect to use substantially all future net operating cash flows to fund distributions to stockholders and to use substantially all net cash flows generated from raising equity or debt financing to fund acquisitions, capital
expenditures, the repayment of outstanding borrowings, and the redemption of shares under the share redemption program. If sufficient equity or debt capital is not available, our future investments in real estate will be lower.

We have a policy of keeping our debt at no more than 50% of the cost of our assets (before depreciation) and, ideally, at significantly
less than this 50% debt-to-real-estate asset ratio. This conservative leverage goal could reduce the amount of current income we can generate for our stockholders, but it also reduces their risk of loss. We believe that preserving investor capital
while generating stable current income is in the best interest of our stockholders. As of March 31, 2010, our debt-to-real-estate asset ratio was approximately 18.5%.

To the extent that future cash flows provided by operations are lower due to lower returns on properties, future distributions to
stockholders may be lower as well. Cash flow from operations will depend significantly on the level of occupancy, market rents and our tenants ability to make rental payments in the future. We believe that the diversity and creditworthiness of
our tenant base helps to mitigate the risk of a tenant defaulting on a lease. However, general economic downturns, downturns in one or more of our core markets, or downturns in the particular industries in which our tenants operate could adversely
impact the ability of our tenants to make lease payments and our ability to re-lease space on favorable terms when leases expire. In the event of any of these situations, our cash flow and consequently our ability to meet capital needs could
adversely affect our ability to pay distributions in the future.

Contractual Commitments and Contingencies

Our contractual obligations as of March 31, 2010 will become payable in the following periods (in thousands):



|                                |  |       |           |      |   |           |  |           |         |            |   |         |  |   |        
|------------------------------- |  | ----- | --------- | ---- | - | --------- |  | --------- | ------- | ---------- | - | ------- |  | - | -------
|Contractual Obligations         |  | Total |           | 2010 |   | 2011-2012 |  | 2013-2014 |         | Thereafter
|Debt obligations                |  | $     | 950,235   |      | $ | 134,242   |  | $         | 153,740 |            | $ | 127,549 |  | $ | 534,704
|Interest obligations on
debt(1) |  |       | 286,362   |      |   | 40,711    |  |           | 89,803  |            |   | 77,246  |  |   | 78,602 
|Capital lease
obligations(2)    |  |       | 664,000   |      |   |          |  |           | 78,000  |            |   | 466,000 |  |   | 120,000
|Purchase
obligations(3)         |  |       | 9,852     |      |   | 9,852     |  |           |        |            |   |        |  |   |       
|Operating lease obligations     |  |       | 228,022   |      |   | 1,851     |  |           | 4,980   |            |   | 5,114   |  |   | 216,077
|                                |  |       |           |      |   |           |  |           |         |            |   |         |  |   |        
|Total                           |  | $     | 2,138,471 |      | $ | 186,656   |  | $         | 326,523 |            | $ | 675,909 |  | $ | 949,383
|                                |  |       |           |      |   |           |  |           |         |            |   |         |  |   |        



|(1) | Interest obligations are measured at the contractual rate for fixed-rate date debt, or at the effectively fixed-rate for variable- rate debt with
interest rate swaps agreements. See Item 3. Quantitative and Qualitative Disclosure About Market Risk for more information regarding our interest rate swaps.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(2) | Amounts include principal obligations only. We made interest payments on these obligations of $10.3 million during the three months ended
March 31, 2010, all of which was funded with interest income earned on the corresponding investments in development authority bonds.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(3) | Represents purchase commitments for Cranberry Woods Drive Phase II, of which approximately $9.1 million relates to construction overruns that are
recoverable from the tenant.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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##### Table of Contents

Results of Operations

Overview

Our results of
operations are not indicative of those expected in future periods as a result of acquiring properties during the periods presented and potential future acquisitions of real estate assets.

Comparison of the three months ended March 31, 2009 versus the three months ended March 31, 2010

Rental income remained relatively stable at approximately $106.8 million for the three months ended March 31, 2009 compared to
approximately $107.8 million for the three months ended March 31, 2010. Absent changes to the leases currently in place at our properties and future real estate acquisitions, rental income is expected to remain relatively consistent in future
periods as well.

Tenant reimbursements and property operating costs decreased from approximately $25.9 million and $42.5
million, respectively, for the three months ended March 31, 2009, as compared to approximately $23.4 million and $40.8 million, respectively, for the three months ended March 31, 2010, primarily due to lower utility usage and costs and
lower property taxes in 2010.

Hotel income, net of hotel operating costs, increased slightly from $0.4 million for the three
months ended March 31, 2009 to $0.6 million for the three months ended March 31, 2010 due to an increase in average occupancy levels, partially offset by a decrease in the average daily rate. Hotel income and hotel operating costs are
primarily driven by the local economic conditions and, as a result, are expected to fluctuate according to changes in economic conditions in Cleveland, Ohio.

Asset and property management fees remained relatively stable at approximately $9.4 million for the three months ended
March 31, 2009 compared to approximately $9.3 million for the three months ended March 31, 2010. We expect asset and property management fees to increase in the short term as we acquire additional properties. Such increases are
subject to the asset management fee ceiling and other limitations outlined in the Advisory Agreement. Please refer to Note 7. Related-Party Transactions and Agreements in the accompanying consolidated financial statements for additional
details.

Acquisition fees and expenses decreased from approximately $8.8 million for the three months ended March 31,
2009 to approximately $3.4 million for the three months ended March 31, 2010, due to implementing a prospective accounting rule change. Effective January 1, 2009, GAAP required us to expense acquisition-related costs as incurred; whereas,
prior to this date, acquisition fees and expenses were capitalized as incurred and allocated to properties upon investment. In connection with adopting this accounting rule change, we wrote off $5.6 million of unapplied acquisition fees and expenses
in the first quarter of 2009 related to prior periods.

Depreciation increased from approximately $22.0 million from the three
months ended March 31, 2009 to approximately $23.6 million for the three months ended March 31, 2010, primarily due to the impact of properties acquired in the second quarter of 2009. Excluding the impact of future property acquisitions
and changes to leases currently in place at our properties, depreciation is expected to continue to increase slightly in future periods, as compared to historical periods, due to ongoing capital improvements at our properties.

Amortization remained relatively consistent at approximately $29.9 million for the three months ended March 31, 2009 as
compared to approximately $29.2 million for the three months ended March 31, 2010. Excluding the impact of future property acquisitions and changes to the leases currently in place at our properties, future amortization is expected to
remain consistent in future periods as well.

General and administrative expenses decreased from approximately $6.8 million
for the three months ended March 31, 2009 to approximately $6.0 million for the three months ended March 31, 2010, due to decreases in both foreign currency re-measurement expense and costs incurred in connection with prospective
acquisitions that did not close.



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Interest expense increased from approximately $21.8 million for the three months ended
March 31, 2009 to approximately $22.5 million for the three months ended March 31, 2010, primarily due to interest expense on debt related to properties acquired in the second quarter of 2009, which was partially offset by maintaining a $0
outstanding balance on the Wachovia Bank, N.A./Wells Fargo Bank, N.A. line of credit throughout the first quarter of 2010. Future interest expense will depend largely upon the timing and availability of opportunities to acquire real estate assets
consistent with our investment objectives, the level of additional proceeds that we are able to raise under our public offerings, our ability to secure financings or re-financings, and changes in market interest rates. We anticipate that future
borrowings will be used primarily to fund anticipated future acquisitions of real estate.

Interest and other income remained
relatively consistent at approximately $10.3 million for each of the three-month periods ended March 31, 2009 and 2010. Future levels of interest income will vary primarily based on differences in the pace at which capital is raised in our
public offerings and the pace at which such capital is invested in real estate assets or used to repay borrowings.

We
recognized a loss on foreign currency exchange contract of approximately $0.6 million for the three months ended March 31, 2009. Gains (losses) on foreign currency exchange contract are primarily impacted by fluctuations in value of the U.S.
dollar compared to the Russian rouble. We settled the foreign currency exchange contract on April 1, 2009 with a payment of $8.2 million.

We recognized a gain on interest rate swaps that do not qualify for hedge accounting treatment of $4.8 million for the three months ended
March 31, 2009, as compared to a loss of $4.9 million for the three months ended March 31, 2010. We anticipate that future gains (losses) on interest rate swaps that do not qualify for hedge accounting treatment will fluctuate
primarily due to changes in the estimated fair value of our interest rate swaps relative to then-current market conditions. Market value adjustments to swaps that qualify for hedge accounting treatment are recorded directly to equity, and therefore,
do not impact net income (loss).

Net income attributable to Wells REIT II decreased from $6.9 million ($0.02 per share) for
the three months ended March 31, 2009 to approximately $2.5 million ($0.00 per share) for the three months ended March 31, 2010. The decrease in net income attributable to Wells REIT II is primarily due to recognizing a $4.9 million loss
on interest rate swaps for the three months ended March 31, 2010, as compared to a $4.8 million gain on interest rate swaps during the three months ended March 31, 2009, partially offset by writing off $5.6 million of unapplied acquisition
costs related to prior periods in 2009 in connection with adopting the accounting rule change explained above. Absent the impact of future acquisitions and future fluctuations in the market value of our interest rate swaps that do not qualify for
hedge accounting treatment, we expect future net income to remain at similar levels in the near term. Should the decline in the U.S. real estate markets continue for a prolonged period of time, the creditworthiness of our tenants and our ability to
achieve market rents comparable to the leases currently in place at our properties may suffer and could lead to a decline in net income over the long term.

Distributions

The
amount of distributions that we pay to our common stockholders is determined by our board of directors and is dependent upon a number of factors, including the funds available for distribution to common stockholders, our financial condition, our
capital expenditure requirements, our expectations of future sources of liquidity and the annual distribution requirements necessary to maintain our status as a REIT under the Code.

When evaluating the amount of cash available to fund distributions to stockholders, we consider net cash provided by operating activities
(as presented in the accompanying GAAP-basis consolidated statements of cash flows). We also consider certain costs that were incurred for the purpose of generating future earnings and appreciation in value over the long term, including
acquisition-related costs. As required by GAAP, effective January 1, 2009, we began to expense all acquisition-related costs as incurred. As provided in the prospectuses for our public offerings, acquisition-related costs have been and will
continue to be funded with cash generated from the sale of common stock in our public offering and, therefore, will not utilize cash generated from operations. Acquisition-related costs include acquisition fees payable to our advisor (see Note 7 to
our accompanying consolidated financial statements), customary third-party costs, such as legal fees and expenses, costs of appraisals, accounting fees and expenses, title insurance premiums and other closing costs, and other miscellaneous costs
directly related to our investments in real estate.



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During the three months ended March 31, 2010, we paid total distributions to common
stockholders, including $40.1 million reinvested in our common stock pursuant to our DRP, of $75.5 million. During this period, we generated net cash from operating activities of $56.0 million, which has been reduced for acquisition-related
costs of $3.4 million that were funded with cash generated from the sale of common stock under our public offerings. The remaining $16.1 million of distributions paid to common stockholders in the three months ended March 31, 2010 were funded
with cumulative operating cash flows generated in prior periods.

On March 1, 2010, our board of directors declared
distributions for stockholders of record from March 16, 2010 through June 15, 2010 in an amount equal to an annualized distribution of $0.60 per share, which is consistent with the prior periods presented in this report on a per-share
basis. We expect that the cash distributions paid to stockholders will be funded from net cash generated by operating activities and other sources of cash. We expect to pay this distribution in June 2010.

We have experienced challenges in locating properties that meet our investment objectives at prices that would generate the same level of
return that our portfolio has generated in the past. As a result, we were not able to fund our first quarter 2010 distribution entirely from current-period cash flows (after adjustment for certain acquisition-related costs, as described above). We
were able, however, to fund the shortfall during this period entirely with prior-period accumulated operating cash flows (adjusted for certain acquisition-related costs). Unless significant opportunities arise to acquire our target investments at
higher cap rates than those we have observed over the last six months, we expect to fully deplete prior period accumulated operating cash flows in the second quarter of 2010 and will have to use sources of funds other than operating cash flows
(after adjustment for acquisition-related expenses) to fund distributions at historical levels. Such sources could include borrowings or offering proceeds. This distribution coverage issue exists even though the operational cash flows from our
existing properties remain strong. Should the current cap rate environment continue, our board of directors may elect to lower the stockholder distribution rate rather than to risk compromising the investment objectives of the fund, or to accumulate
significant borrowings. We will continue to carefully monitor our cash flows and market conditions and their impact on our earnings and future distribution projections.

Election as a REIT

We
have elected to be taxed as a REIT under the Code, and have operated as such beginning with our taxable year ended December 31, 2003. To qualify as a REIT, we must meet certain organizational and operational requirements, including a
requirement to distribute at least 90% of our adjusted taxable income, as defined in the Code, to our stockholders, computed without regard to the dividends-paid deduction and by excluding our net capital gain. As a REIT, we generally will not be
subject to federal income tax on income that we distribute to our stockholders. If we fail to qualify as a REIT in any taxable year, we will then be subject to federal income taxes on our taxable income for that year and for the four years following
the year during which qualification is lost, unless the Internal Revenue Service grants us relief under certain statutory provisions. Such an event could materially adversely affect our net income and net cash available for distribution to our
stockholders. However, we believe that we are organized and operate in such a manner as to qualify for treatment as a REIT for federal income tax purposes.

Wells TRS is a wholly owned subsidiary of Wells REIT II that is organized as a Delaware limited liability company and includes the
operations of, among other things, a full-service hotel. We have elected to treat Wells TRS as a taxable REIT subsidiary. We may perform certain additional, non-customary services for tenants of our buildings through Wells TRS; however, any earnings
related to such services are subject to federal and state income taxes. In addition, for us to continue to qualify as a REIT, we must limit our investments in taxable REIT subsidiaries to 25% of the value of our total assets. Deferred tax assets and
liabilities are established for temporary differences between the financial reporting basis and the tax basis of assets and liabilities at the enacted rates expected to be in effect when the temporary differences reverse.

No provision for federal income taxes has been made in our accompanying consolidated financial statements, other than the provision
relating to Wells TRS, as we made distributions in excess of taxable income for the periods presented. We are subject to certain state and local taxes related to property operations in certain locations, which have been provided for in our
accompanying consolidated financial statements.



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##### Table of Contents

Inflation

We are exposed to inflation risk, as income from long-term leases is the primary source of our cash flows from operations. There are
provisions in the majority of our tenant leases that are intended to protect us from, and mitigate the risk of, the impact of inflation. These provisions include rent steps, reimbursement billings for operating expense pass-through charges, real
estate tax and insurance reimbursements on a per-square-foot basis, or in some cases, annual reimbursement of operating expenses above a certain per-square-foot allowance. However, due to the long-term nature of the leases, the leases may not reset
frequently enough to fully cover inflation.

Application of Critical Accounting Policies

Our accounting policies have been established to conform with GAAP. The preparation of financial statements in conformity with GAAP
requires management to use judgment in the application of accounting policies, including making estimates and assumptions. These judgments affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at
the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. If our judgment or interpretation of the facts and circumstances relating to various transactions had been different, it is possible
that different accounting policies would have been applied, thus resulting in a different presentation of the financial statements. Additionally, other companies may utilize different estimates that may impact the comparability of our results of
operations to those of companies in similar businesses.

Investment in Real Estate Assets

We are required to make subjective assessments as to the useful lives of our depreciable assets. We consider the period of future benefit
of the asset to determine the appropriate useful lives. These assessments have a direct impact on net income. The estimated useful lives of our assets by class are as follows:



|                        |  |                                       
|----------------------- |  | --------------------------------------
|Buildings               |  | 40 years                              
|Building improvements   |  | 5-25 years                            
|Site improvements       |  | 10 years                              
|Tenant improvements     |  | Shorter of economic life or lease term
|Intangible lease assets |  | Lease term                            

Evaluating the
Recoverability of Real Estate Assets

We continually monitor events and changes in circumstances that could indicate that
the carrying amounts of the real estate and related intangible assets of both operating properties and properties under construction, in which we have an ownership interest, either directly or through investments in joint ventures, may not be
recoverable. When indicators of potential impairment are present that suggest that the carrying amounts of real estate assets and related intangible assets may not be recoverable, we assess the recoverability of these assets by determining whether
the respective carrying values will be recovered through the estimated undiscounted future operating cash flows expected from the use of the assets and their eventual disposition. In the event that such expected undiscounted future cash flows do not
exceed the carrying values, we adjust the carrying value of the real estate assets and related intangible assets to the estimated fair values, pursuant to the property, plant, and equipment accounting standard for the impairment or disposal of
long-lived assets, and recognize an impairment loss. Estimated fair values are calculated based on the following information, in order of preference, depending upon availability: (i) recently quoted market prices, (ii) market prices for
comparable properties, or (iii) the present value of future cash flows, including estimated salvage value. We have determined that there has been no impairment in the carrying value of our real estate assets and related intangible assets to
date.

Projections of expected future operating cash flows require that we estimate future market rental income amounts
subsequent to the expiration of current lease agreements, property operating expenses, the number of months it takes to re-lease the property, and the number of years the property is held for investment, among other factors. The subjectivity of



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##### Table of Contents

assumptions used in the future cash flow analysis, including discount rates, could result in an incorrect assessment of the propertys fair value and could result in the misstatement of the
carrying value of our real estate assets and related intangible assets and net income (loss).

Allocation of Purchase Price of Acquired
Assets

Upon the acquisition of real properties, we allocate the purchase price of properties to tangible assets,
consisting of land and building, site improvements, and identified intangible assets and liabilities, including the value of in-place leases, based in each case on our estimate of their fair values.

The fair values of the tangible assets of an acquired property (which includes land and building) are determined by valuing the property
as if it were vacant, and the as-if-vacant value is then allocated to land and building based on our determination of the relative fair value of these assets. We determine the as-if-vacant fair value of a property using methods similar
to those used by independent appraisers. Factors we consider in performing these analyses include an estimate of carrying costs during the expected lease-up periods considering current market conditions and costs to execute similar leases, including
leasing commissions and other related costs. In estimating carrying costs, we include real estate taxes, insurance, and other operating expenses during the expected lease-up periods based on current market demand.

Intangible Assets and Liabilities Arising from In-Place Leases where We are the Lessor

As further described below, in-place leases where we are the lessor may have values related to: direct costs associated with obtaining a
new tenant, opportunity costs associated with lost rentals that are avoided by acquiring an in-place lease, tenant relationships, and effective contractual rental rates that are above or below market rates:



| |  |  | Direct costs associated with obtaining a new tenant, including commissions, tenant improvements and other direct costs, are estimated based on
managements consideration of current market costs to execute a similar lease. Such direct costs are included in intangible lease origination costs in the accompanying consolidated balance sheets and are amortized to expense over the remaining
terms of the respective leases.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The value of opportunity costs associated with lost rentals avoided by acquiring an in-place lease is calculated based on the contractual amounts to
be paid pursuant to the in-place leases over a market absorption period for a similar lease. Such opportunity costs are included in intangible lease assets in the accompanying consolidated balance sheets and are amortized to expense over the
remaining terms of the respective leases.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The value of tenant relationships is calculated based on expected renewal of a lease or the likelihood of obtaining a particular tenant for other
locations. Values associated with tenant relationships are included in intangible lease assets in the accompanying consolidated balance sheets and are amortized to expense over the remaining terms of the respective leases.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The value of effective rental rates of in-place leases that are above or below the market rates of comparable leases is calculated based on the
present value (using a discount rate that reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be received pursuant to the in-place leases and (ii) managements estimate of
fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining terms of the leases. The capitalized above-market and below-market lease values are recorded as intangible lease assets or liabilities and
amortized as an adjustment to rental income over the remaining terms of the respective leases.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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##### Table of Contents

As of March 31, 2010 and December 31, 2009, Wells REIT II had the following gross
intangible in-place lease assets and liabilities (in thousands):



|                  |                                  |                         |                        |                                 |   |                                                 |  |   |         |  |   |        
|----------------- | -------------------------------- | ----------------------- | ---------------------- | ------------------------------- | - | ----------------------------------------------- |  | - | ------- |  | - | -------
|                  |                                  | Intangible Lease Assets |                        | IntangibleLeaseOriginationCosts |   | IntangibleBelow-MarketIn-Place LeaseLiabilities
|                  | Above-MarketIn-Place LeaseAssets |                         | AbsorptionPeriod Costs |                                 |  
|March 31, 2010    |                                  | $                       | 152,045                |                                 | $ | 554,867                                         |  | $ | 490,358 |  | $ | 150,864
|                  |                                  |                         |                        |                                 |   |                                                 |  |   |         |  |   |        
|December 31, 2009 |                                  | $                       | 153,189                |                                 | $ | 557,365                                         |  | $ | 489,567 |  | $ | 150,081
|                  |                                  |                         |                        |                                 |   |                                                 |  |   |         |  |   |        

For the three months ended March 31, 2010 and the
year ended December 31, 2009, Wells REIT II recognized the following amortization of intangible lease assets and liabilities (in thousands):



|                                          |                                  |                         |                        |                                 |   |                                                 |  |   |        |  |   |       
|----------------------------------------- | -------------------------------- | ----------------------- | ---------------------- | ------------------------------- | - | ----------------------------------------------- |  | - | ------ |  | - | ------
|                                          |                                  | Intangible Lease Assets |                        | IntangibleLeaseOriginationCosts |   | IntangibleBelow-MarketIn-Place LeaseLiabilities
|                                          | Above-MarketIn-Place LeaseAssets |                         | AbsorptionPeriod Costs |                                 |  
|For the three months ended March 31, 2010 |                                  | $                       | 4,351                  |                                 | $ | 14,991                                          |  | $ | 12,296 |  | $ | 3,522 
|                                          |                                  |                         |                        |                                 |   |                                                 |  |   |        |  |   |       
|For the year ended December 31, 2009      |                                  | $                       | 17,912                 |                                 | $ | 64,108                                          |  | $ | 51,266 |  | $ | 14,570
|                                          |                                  |                         |                        |                                 |   |                                                 |  |   |        |  |   |       

The remaining net intangible assets and liabilities as of
March 31, 2010 will be amortized as follows (in thousands):



|                                             |                                  |                         |                        |                                 |   |                                                 |  |   |         |  |   |       
|-------------------------------------------- | -------------------------------- | ----------------------- | ---------------------- | ------------------------------- | - | ----------------------------------------------- |  | - | ------- |  | - | ------
|                                             |                                  | Intangible Lease Assets |                        | IntangibleLeaseOriginationCosts |   | IntangibleBelow-MarketIn-Place LeaseLiabilities
|                                             | Above-MarketIn-Place LeaseAssets |                         | AbsorptionPeriod Costs |                                 |  
|For the nine months ending December 31, 2010 |                                  | $                       | 12,690                 |                                 | $ | 45,560                                          |  | $ | 37,441  |  | $ | 10,904
|For the years ending December 31:            |                                  |                         |                        |                                 |   |                                                 |  |   |         |  |   |       
|2011                                         |                                  |                         | 14,075                 |                                 |   | 52,194                                          |  |   | 45,701  |  |   | 14,183
|2012                                         |                                  |                         | 10,407                 |                                 |   | 43,812                                          |  |   | 40,472  |  |   | 13,585
|2013                                         |                                  |                         | 8,488                  |                                 |   | 38,135                                          |  |   | 37,413  |  |   | 13,281
|2014                                         |                                  |                         | 7,398                  |                                 |   | 32,870                                          |  |   | 34,326  |  |   | 12,696
|Thereafter                                   |                                  |                         | 15,623                 |                                 |   | 94,190                                          |  |   | 99,090  |  |   | 34,134
|                                             |                                  |                         |                        |                                 |   |                                                 |  |   |         |  |   |       
|                                             |                                  | $                       | 68,681                 |                                 | $ | 306,761                                         |  | $ | 294,443 |  | $ | 98,783
|                                             |                                  |                         |                        |                                 |   |                                                 |  |   |         |  |   |       

Evaluating the Recoverability of Intangible Assets and Liabilities

The values of intangible lease assets and liabilities are determined based on assumptions made at the time of acquisition
and have defined useful lives, which correspond with the lease terms. There may be instances in which intangible lease assets and liabilities become impaired and we are required to write-off the remaining asset or liability immediately or over a
shorter period of time. Lease restructurings, including lease terminations and lease extensions, may impact the value and useful life of in-place leases. In-place leases that are terminated, partially terminated, or
modified will be evaluated for impairment if the original in-place lease terms have been modified. In the event that the discounted cash flows of the original in-place lease stream do not exceed
the discounted modified in-place lease stream, we adjust the carrying value of the intangible lease assets to the discounted cash flows and recognize an impairment loss. For in-place lease extensions that are
executed more than one year prior to the original in-place lease expiration date, the useful life of the in-place lease will be extended over the new lease term with the exception of those in-place
lease components, such as lease commissions and tenant allowances, which have been renegotiated for the extended term. Renegotiated in-place lease components, such as lease commissions and tenant allowances, will be amortized over the
shorter of the useful life of the asset or the new lease term.



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##### Table of Contents

Intangible Assets and Liabilities Arising from In-Place Leases where We are the Lessee

In-place ground leases where we are the lessee may have value associated with effective contractual rental rates that are above or below
market rates. Such values are calculated based on the present value (using a discount rate that reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place
lease and (ii) managements estimate of fair market lease rates for the corresponding in-place lease, measured over a period equal to the remaining terms of the leases. The capitalized above-market and below-market in-place lease values
are recorded as intangible lease liabilities or assets and amortized as an adjustment to property operating cost over the remaining term of the respective leases. Wells REIT II had a gross below-market lease asset of approximately
$110.7 million and $110.7 million as of March 31, 2010 and December 31, 2009, and recognized amortization of this asset of approximately $0.5 million for the three months ended March 31, 2010 and approximately
$2.1 million for the year ended December 31, 2009.

As of March 31, 2010, the remaining net below-market lease
asset will be amortized as follows (in thousands):



|                                 |  |   |        
|-------------------------------- |  | - | -------
|For the year ending December 31: |  |   |        
|2010                             |  | $ | 1,552  
|2011                             |  |   | 2,069  
|2012                             |  |   | 2,069  
|2013                             |  |   | 2,069  
|2014                             |  |   | 2,069  
|Thereafter                       |  |   | 95,553 
|                                 |  |   |        
|                                 |  | $ | 105,381
|                                 |  |   |        

RelatedParty Transactions and Agreements

We have entered into agreements with our advisor, Wells Capital, and its affiliates, whereby we pay certain fees and reimbursements to
Wells Capital or its affiliates, for acquisition fees, commissions, dealer-manager fees, asset and property management fees, construction fees, reimbursement of other offering costs, and reimbursement of operating costs. See Note 7 to our
accompanying consolidated financial statements included herein for a discussion of the various related-party transactions, agreements, and fees.

Commitments and Contingencies

We are subject to certain commitments and contingencies with regard to certain transactions. Refer to Note 5 of our accompanying
consolidated financial statements for further explanation. Examples of such commitments and contingencies include:



| |  |  | property under construction;
| | - |  | ----------------------------



| |  |  | obligations under operating leases;
| | - |  | -----------------------------------



| |  |  | obligations under capital leases;
| | - |  | ---------------------------------



| |  |  | commitments under existing lease agreements; and
| | - |  | ------------------------------------------------



| |  |  | litigation.
| | - |  | -----------



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##### Table of Contents

Subsequent Events

We evaluated subsequent events in conjunction with the preparation of its consolidated financial statements and notes thereto included in
this report on Form 10-Q and note the following items:

Property Acquisition

On April 1, 2010, we purchased two three-story office buildings with approximately 490,000 rentable square feet located at 550 King
Street, Littleton, Massachusetts (the 550 King Street Building) for approximately $94.0 million, exclusive of closing costs. The 550 King Street Building is leased entirely to International Business Machines Corporation under a 10-year
lease.

Status of Our Public Offerings

On April 27, 2010, our board of directors elected to conclude the Third Offering effective June 30, 2010. As a result, we will
not make offers under our current primary public offering after June 30, 2010; however, we will continue to offer shares through our dividend reinvestment program. From April 1, 2010 through April 30, 2010, we raised approximately
$32.8 million through the issuance of approximately 3.3 million shares of common stock under the Third Offering. As of April 30, 2010, approximately 228.6 million shares remained available for sale to the public under the Third
Offering through June 30, 2010, exclusive of shares available under the DRP.

Corporate Credit Rating

In connection with evaluating various borrowing arrangements to replace the line of credit agreement in place with Wachovia Bank,
N.A./Wells Fargo Bank, N.A. as lead agent as of March 31, 2010, we sought a credit rating from Moodys Investors Service and Standard and Poors Ratings Services. As a result of obtaining an investment-grade rating from both agencies
in April 2010, we believe we were able to garner broader participation from prospective lenders and to achieve lower pricing on the replacement credit facility described below.

Replacement Credit Facility

On May 7, 2010, we entered into a $500.0 million, three-year, unsecured revolving credit facility with a syndicate of lenders led by
JPMorgan Chase Bank, N.A. as administrative agent (the JPMorgan Chase Credit Facility) to replace the $245.0 million unsecured revolving financing facility with Wachovia Bank, N.A./Wells Fargo Bank, N.A., which was scheduled to mature on
May 7, 2010.

The JPMorgan Chase Credit Facility provides for interest to be incurred based on, at our option, the London
Interbank Offered Rate (LIBOR) for one-, two-, three- or six-month periods, plus an applicable margin ranging from 2.60% to 3.40% (the LIBOR Rate), or at an alternate base rate, plus an applicable margin ranging from 1.60% to
2.40% (the Base Rate). The base rate for any day is the greatest of (1) the rate of interest publicly announced by JPMorgan Chase Bank, N.A. as its prime rate in effect in its principal office in New York City for such day;
(2) the federal funds rate for such day plus 0.50%; or (3) the one-month LIBOR Rate, for such day plus 1.00%. The margin component of the LIBOR Rate and the Base Rate is determined based on our corporate credit rating, as long as we have
such a rating, or on our leverage ratio, as defined, if we do not have a corporate credit rating. Additionally, we will incur a facility fee on the aggregate revolving commitment ranging from 0.40% to 0.60% per annum, which is also determined
based on our corporate credit rating, as long as we have such a rating, or on our leverage ratio, if we do not have a corporate credit rating.

Under the JPMorgan Chase Credit Facility, interest on LIBOR Rate loans is payable in arrears on the last day of each interest period;
interest on Base Rate loans is payable in arrears, on the first day of each month. We are required to repay all outstanding principal balances and accrued interest by May 7, 2013. Further, we are subject to certain restrictive and financial
covenants under the JPMorgan Chase Credit Facility, including a $25.0 million limitation on letters of credit that may be issued under the JPMorgan Chase Credit Facility.



|ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|------- | ----------------------------------------------------------

As a result of our debt facilities, we are exposed to interest rate changes. Our interest rate risk management objectives are to limit
the impact of interest rate changes on earnings and cash flow primarily through a low to moderate level of overall



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borrowings. However, we currently have a substantial amount of debt outstanding. We manage our ratio of fixed- to floating-rate debt with the objective of achieving a mix that we believe is
appropriate in light of anticipated changes in interest rates. We closely monitor interest rates and will continue to consider the sources and terms of our borrowing facilities to determine whether we have appropriately guarded ourselves against the
risk of increasing interest rates in future periods.

Additionally, we have entered into interest rate swaps, and may enter
into other interest rate swaps, caps, or other arrangements to mitigate our interest rate risk on a related financial instrument. We do not enter into derivative or interest rate transactions for speculative purposes; however, certain of our
derivatives may not qualify for hedge accounting treatment. All of our debt was entered into for other than trading purposes.

Our financial instruments consist of both fixed-rate and variable-rate debt. Our variable-rate borrowings consist of the amended and
restated Wachovia Bank, N.A./Wells Fargo Bank, N.A. line of credit, the Cranberry Woods Drive mortgage note, the 222 E. 41st Street Building mortgage note, the 80 Park Plaza Building mortgage note, and the Three Glenlake Building mortgage
note. However, only the amended and restated Wachovia Bank, N.A./Wells Fargo Bank, N.A. line of credit and the Cranberry Woods Drive mortgage note bear interest at an effectively variable rate, as the variable rates on the 222 E. 41st
Street Building mortgage note, the 80 Park Plaza Building mortgage note, and the Three Glenlake Building mortgage note have been effectively fixed through the interest rate swap agreements described below. As of March 31, 2010, we had no
amounts outstanding under the Wachovia Bank, N.A./Wells Fargo Bank, N.A. line of credit; $63.4 million outstanding on the Cranberry Woods Drive variable-rate, term mortgage loan; $155.7 million outstanding on the 222 E. 41st Street
Building mortgage note; $57.9 million outstanding on the 80 Park Plaza Building mortgage note; $25.5 million outstanding on the Three Glenlake Building mortgage note; $13.0 million outstanding on the fixed-rate Bank Zenit loan; and $634.8
million outstanding on fixed-rate, term mortgage loans. The weighted-average interest rate of all of our debt instruments was 5.74% as of March 31, 2010.

On May 7, 2009, we amended and restated our line of credit with a syndicate of banks led by Wachovia Bank, N.A./Wells Fargo Bank,
N.A. for $245.0 million. This facility was subject to interest costs based on, at our option, the LIBOR Indexed Rate or the Base Indexed Rate. The base rate for any day was the greatest of the lenders prime rate, as defined, for such day, the
federal funds rate for such day plus 0.50%, and the one-month adjusted eurodollar rate, which is subject to a 2.00% floor, for such day plus 1.00%. The margin component of the LIBOR Indexed Rate and the Base Indexed Rate was based on our
debt-to-total-asset value ratio, as defined. On May 7, 2010, this facility was replaced with a new $500.0, three year facility led by JPMorgan Chase Bank, N.A. (see Note 8. Subsequent Events to the accompanying consolidated financial
statements). An increase in the variable interest rate on this line of credit constitutes a market risk, as an increase in rates would increase interest incurred and, therefore, decrease cash flows available for distribution to stockholders.

The 80 Park Plaza Building mortgage note was used to purchase the 80 Park Plaza Building. The note bears interest at
one-month LIBOR plus 130 basis points (approximately 1.53% per annum as of March 31, 2010) and matures in September 2016. In connection with obtaining the 80 Park Plaza Building mortgage note, we entered into an interest rate swap
agreement to hedge exposure to changing interest rates. The interest rate swap agreement has an effective date of September 22, 2006 and matures September 21, 2016. The terms of the interest rate swap agreement effectively fix our interest
rate on the 80 Park Plaza Building mortgage note at 6.575% per annum.

The 222 E. 41st Street Building mortgage note was
used to purchase the 222 E. 41st Street Building. The note bears interest at one-month LIBOR plus 120 basis points (approximately 1.43% per annum as of March 31, 2010) and matures in August 2017. In connection with obtaining the 222 E.
41st Street Building mortgage note, we entered into an interest rate swap agreement to hedge exposure to changing interest rates. The interest rate swap agreement has an effective date of August 16, 2007 and matures August 16, 2017. The
interest rate swap effectively fixes our interest rate on the 222 E. 41st Street Building mortgage note at 6.675% per annum.

The Three Glenlake Building mortgage note was used to purchase the Three Glenlake Building. The note bears interest at one-month LIBOR
plus 90 basis points (approximately 1.13% per annum as of March 31, 2010), and matures in July 2013. The interest rate swap agreement has an effective date of July 31, 2008 and matures July 31, 2013. Interest is due monthly;
however, under the terms of the loan agreement, a portion of the monthly debt service amounts accrues and is added to the outstanding balance of the note over the term. The interest rate swap effectively fixes our interest rate on the Three Glenlake
Building mortgage note at 5.95% per annum.



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Approximately $886.8 million of our total debt outstanding as of March 31, 2010 is
subject to fixed rates, either directly or when coupled with an interest rate swap agreement. As of March 31, 2010, these balances incurred interest expense at an average interest rate of 5.80% and have expirations ranging from 2010 through
2018. A change in the market interest rate impacts the net financial instrument position of our fixed-rate debt portfolio; however, it has no impact on interest incurred or cash flows. The amounts outstanding on our variable-rate debt facilities in
the future will largely depend upon the level of investor proceeds raised under our public offering and the rate at which we are able to employ such proceeds in acquisitions of real properties.

We do not believe there is any exposure to increases in interest rates related to the capital lease obligations of $664.0 million at
March 31, 2010, as the obligations are at fixed interest rates.

Foreign Currency Risk

We are also subject to foreign exchange risk arising from our foreign operations in Russia. Foreign operations represented 1.6% and 1.7%
of total assets at March 31, 2010 and December 31, 2009, respectively, and 0% of total revenue for each of the three month periods ended March 31, 2010 and 2009. As compared to rates in effect at March 31, 2010, an increase or
decrease in the U.S. dollar to Russian rouble exchange rate by 10% would not materially impact the accompanying consolidated financial statements.



|ITEM 4T. | CONTROLS AND PROCEDURES
|-------- | -----------------------

Managements Conclusions Regarding the Effectiveness of Disclosure Controls and Procedures

We carried out an evaluation, under the supervision and with the participation of management, including the Principal Executive Officer
and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rule 13a-15(e) under the Securities Exchange Act of 1934 as of the end of the period covered by this report.
Based upon that evaluation, the Principal Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report in providing a reasonable level of
assurance that information we are required to disclose in reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods in SEC rules and forms, including providing a
reasonable level of assurance that information required to be disclosed by us in such reports is accumulated and communicated to our management, including our Principal Executive Officer and our Principal Financial Officer, as appropriate to allow
timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There have been no significant changes in our internal control over financial reporting during the quarter ended March 31, 2010 that
have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION



|ITEM 1. | LEGAL PROCEEDINGS
|------- | -----------------

From
time to time, we are party to legal proceedings, which arise in the ordinary course of our business. We are not currently involved in any legal proceedings of which the outcome is reasonably likely to have a material adverse effect on our results of
operations or financial condition, nor are we aware of any such legal proceedings contemplated by governmental authorities.



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|ITEM 1A. | RISK FACTORS
|-------- | ------------

There have
been no material changes from the risk factors disclosed in the Risk Factors section of our annual report on Form 10-K for the year ended December 31, 2009.



|ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|------- | -----------------------------------------------------------



|(a) | All equity securities sold by us in the quarter ended March 31, 2010 were sold in an offering registered under the Securities Act of 1933.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------



|(b) | Not applicable.
|--- | ---------------



|(c) | During the quarter ended March 31, 2010, we redeemed shares as follows (in thousands, except per-share amounts):
|--- | ----------------------------------------------------------------------------------------------------------------



|              |  |                                     |  |                              |      |                                                                                   |     |  |                                                                                     |    
|------------- |  | ----------------------------------- |  | ---------------------------- | ---- | --------------------------------------------------------------------------------- | --- |  | ----------------------------------------------------------------------------------- | ---
|Period        |  | Total Number ofShares 
Purchased(1) |  | Average PricePaid 
per Share |      | Total Number ofShares 
Purchased asPart of PubliclyAnnounced Plans
orPrograms
(2) |     |  | Approximate DollarValue of 
SharesAvailable That MayYet BeRedeemed
Underthe Program
|January 2010  |  | 421                                 |  | $                            | 9.96 |                                                                                   | 421 |  |                                                                                     | (3)
|February 2010 |  | 353                                 |  | $                            | 9.85 |                                                                                   | 353 |  |                                                                                     | (3)
|March 2010    |  | 994                                 |  | $                            | 9.85 |                                                                                   | 994 |  |                                                                                     | (3)



|(1) | All purchases of our equity securities by us in the three months ended March 31, 2010, were made pursuant to our SRP.
|--- | ---------------------------------------------------------------------------------------------------------------------



|(2) | We announced the commencement of the program on December 10, 2003 and amendments to the program on April 22, 2004; March 28,
2006; May 11, 2006; August 10, 2006; August 8, 2007; November 13, 2008; March 31, 2009; August 13, 2009; and February 18, 2010.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(3) | We currently limit the dollar value of shares that may yet be redeemed under the program as described in the SRP.
|--- | -----------------------------------------------------------------------------------------------------------------

On February 18, 2010, our stockholders approved an amendment to the SRP, which imposes a limit on the amount of funds that we can
pay to redeem shares in connection with the death of stockholders in a particular calendar year. Prior to the amendment, which became effective April 30, 2010, we honored all redemption requests made within two years of a stockholders
death, while the aggregate amount that we paid for all other redemptions could not exceed 100% of the net proceeds from our dividend reinvestment plan during the then-current calendar year. As a result of the stockholder-approved amendment, our SRP
will limit all redemptions during any calendar year, including those sought within two years of a stockholders death, to those that can be funded from 100% of the net proceeds from our dividend reinvestment plan during that calendar year.

On February 18, 2010, our stockholders also approved the termination of the insurance policy that would have provided
funding for the redemption of shares under our SRP in the event that we were to receive an unusually large number of redemption requests sought within two years of a stockholders death. With the amendment to our SRP described above, the
insurance policy no longer offers any benefit.

After giving effect to the SRP amendment, if we cannot repurchase all shares
presented for redemption in any period because of the limitations described above, we will honor redemption requests on a pro rata basis as follows:



| |  |  | First, if necessary, we will limit requests for Ordinary Redemptions (which are currently suspended) on a pro rata basis so that the amount paid for
Ordinary Redemptions during the then-current calendar year would not exceed 50% of the net proceeds from sales under our dividend reinvestment plan during such calendar year. Requests precluded by this test would not be considered in the tests
below.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | Second, if necessary, we will limit requests for Ordinary Redemptions and those upon the qualifying disability of a stockholder on a pro rata basis
so that the aggregate of such redemptions during any calendar year would not exceed 5% of the weighted-average number of shares outstanding in the prior calendar year. Requests precluded by this test would not be considered in the test below.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Finally, if necessary, we will limit all redemption requests, including those sought within two years of a stockholders death, on a pro rata
basis so that the aggregate of such redemptions during any calendar year would not exceed 100% of the net proceeds from our dividend reinvestment plan during the calendar year.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|ITEM 3. | DEFAULTS UPON SENIOR SECURITIES
|------- | -------------------------------



|(a) | There have been no defaults with respect to any of our indebtedness.
|--- | --------------------------------------------------------------------



|(b) | Not applicable.
|--- | ---------------



|ITEM 4. | RESERVED
|------- | --------



|ITEM 5. | OTHER INFORMATION
|------- | -----------------



|(a) | During the first quarter of 2010, there was no information that was required to be disclosed in a report on Form 8-K that was not disclosed in
a report on Form 8-K.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(b) | There are no material changes to the procedures by which stockholders may recommend nominees to our board of directors since the filing of our
Schedule 14A.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------



|ITEM 6. | EXHIBITS
|------- | --------

The exhibits
required to be filed with this report are set forth on the Exhibit Index to this quarterly report attached hereto.



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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.



|                    |  |  |  |                                                          |  |                                                                                        
|------------------- |  |  |  | -------------------------------------------------------- |  | ---------------------------------------------------------------------------------------
|                    |  |  |  | WELLS REAL ESTATE INVESTMENT TRUST II, INC.
(Registrant)
|                    |  |  | 
|Dated: May 11, 2010 |  |  |  | By:                                                      |  | /s/ DOUGLAS P. WILLIAMS                                                                
|                    |  |  |  |                                                          |  | Douglas P. Williams
Executive Vice President, Treasurer and
Principal Financial Officer



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EXHIBIT INDEX TO

FIRST QUARTER 2010 FORM 10-Q OF

WELLS REAL ESTATE INVESTMENT TRUST II, INC.

The following documents are filed as exhibits to this report. Exhibits that are not required for this report are omitted.



|            |  |                                                                                                                                                                                                                                                                                                                                                                                           
|----------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                                                                                                                                                                                                                                                                               
|            | 
|3.1         |  | Amended and Restated Articles of Incorporation (incorporated by reference to Exhibit 3.1 to Amendment No. 3 to the Registration Statement on Form S-11 (No. 333-107066) filed with
the Commission on November 25, 2003).                                                                                                                                                                  
|            | 
|3.2         |  | Articles of Amendment of Wells Real Estate Investment Trust II, Inc., effective as of October 1, 2008 (incorporated by reference to Exhibit 3.2 to the Companys Annual
Report on Form 10-K for the year ended December 31, 2008).                                                                                                                                                        
|            | 
|3.3         |  | Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 to the Companys Quarterly Report on Form 10-Q for the quarter ended June 30, 2007).                                                                                                                                                                                                                                
|            | 
|3.4         |  | Amendment No. 1 to Amended and Restated Bylaws (incorporated by reference to Exhibit 3.3 to the Companys Quarterly Report on Form 10-Q for the quarter ended June 30,
2007).                                                                                                                                                                                                             
|            | 
|4.1         |  | Form of Subscription Agreement with Consent to Electronic Delivery (incorporated by reference to Appendix A to the Companys prospectus dated April 2, 2010 and filed with the
Commission on April 29, 2010).                                                                                                                                                                             
|            | 
|4.2         |  | Statement regarding restrictions on transferability of shares of common stock (to appear on stock certificate or to be sent upon request and without charge to stockholders issued
shares without certificates) (incorporated by reference to Exhibit 4.2 to Amendment No. 2 to the Registration Statement on Form S-11 (No. 333-144414) filed with the Commission on September 22, 2008).
|            | 
|4.3         |  | Amended and Restated Dividend Reinvestment Plan (incorporated by reference to Appendix B to the Companys prospectus dated April 2, 2010 and filed with the Commission on April
29, 2010).                                                                                                                                                                                                
|            | 
|4.4         |  | Amended Share Redemption Program (incorporated by reference to Exhibit 4.5 to the Companys Annual Report on Form 10-K for the year ended December 31, 2009).                                                                                                                                                                                                                             
|            | 
|10.1        |  | Advisory Agreement between the Company and Wells Capital, Inc. dated August 1, 2009 (incorporated by reference to Exhibit 10.1 to the Companys Quarterly Report on Form 10-Q
for the quarter ended June 30, 2009).                                                                                                                                                                       
|            | 
|31.1*       |  | Certification of the Chief Executive Officer of the Company, pursuant to Securities Exchange Act Rules 13a-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.                                                                                                                                                                                                    
|            | 
|31.2*       |  | Certification of the Chief Financial Officer of the Company, pursuant to Securities Exchange Act Rules 13a-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.                                                                                                                                                                                                    
|            | 
|32.1*       |  | Certification of the Chief Executive Officer and Chief Financial Officer of the Company, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.                                                                                                                                                                                         



|* | Filed herewith.
|- | ---------------