----

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| (Mark One) |                                                                                          |
|------------|-----------------------------------------------------------------------------------------------|
| R          | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  |
|       | For the quarterly period ended June 30, 2009                                                  |
| or         |
| £     | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|       | For the transition period from to                                                             |

| Maryland                                 | 20-0138854          |
|------------------------------------------|---------------------|
| (State or Other Jurisdiction of          | (I.R.S. Employer    |
| Incorporation or Organization)           | Identification No.) |
| 2800 Post Oak Boulevard                  |                |
| Suite 5000                          |                |
| Houston, Texas                           | 77056-6118          |
| (Address of principal executive offices) | (Zip code)          |

|  Large accelerated filer   o | Accelerated Filer   o | Non-accelerated filer   ý | Smaller Reporting Company   o |
|---------------------------------------------|---------------------------------|------------------------------------------|-----------------------------------------|

----

----

| PART I – FINANCIAL INFORMATION         |                                                                                        |   |   |
|--------------------------------------------------------|---------------------------------------------------------------------------------------------|--------|--------|
|                                                   |                                                                                        |   |   |
| Item 1.                                           | Condensed Consolidated Financial Statements (Unaudited)                                     |   |   |   |
|                                                   | Condensed Consolidated Balance Sheets                                                       |   |   |   2 |   |
|                                                   | Condensed Consolidated Statements of Operations                                             |   |   |   3 |   |
|                                                   | Condensed Consolidated Statements of Equity                                                 |   |   |   4 |   |
|                                                   | Condensed Consolidated Statements of Cash Flows                                             |   |   |   5 |   |
|                                                   | Notes to the Condensed Consolidated Financial Statements                                    |   |   |   6 |   |
| Item 2.                                           | Management’s Discussion and Analysis of Financial Condition and Results of Operations |   |   |   22 |   |
| Item 3.                                           | Quantitative and Qualitative Disclosures About Market Risk                                  |   |   |   34 |   |
| Item 4T.                                          | Controls and Procedures                                                                     |   |   |   34 |   |
|                                                   |                                                                                        |   |   |   |
| PART II – OTHER INFORMATION            |                                                                                        |   |   |   |
|                                                   |                                                                                        |   |   |   |
| Item 1A.                                          | Risk Factors                                                                           |   |   |   35 |   |
| Item 2.                                                | Unregistered Sales of Equity Securities and Use of Proceeds                                 |   |   |   37 |   |
| Item 6.                                           | Exhibits                                                                                    |   |   |   37 |   |
|                                                   |                                                                                        |   |   |   |   |
| SIGNATURES                                             |                                                                                        |   |   |   |
| Certification                                          |                                                                                        |   |   |   |
| Certification                                          |                                                                                        |   |   |   |
| Certification of CEO & CFO pursuant to Section 906 |                                                                                        |   |   |   |
|                                                   |                                                                                        |   |   |   |

----

|                                                                                                                                                                                                                                     |   | June 30, 2009                            |      |   | December 31, 2008 |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------|-----------|--------|-------------------|--------|
|                                                                                                                                                                                                                                     |   | (In thousands, except per share amounts) |      |
| ASSETS                                                                                                                                                                                                                                   |   |                                     |      |   |              |   |
| Investment property, net                                                                                                                                                                                                                 |   | $                                        | 2,383,875 |   |              | $      | 2,374,007 |   |
| Investments in unconsolidated entities                                                                                                                                                                                                   |   |                                     | 385,739   |   |              |   | 364,374 |   |
| Cash and cash equivalents                                                                                                                                                                                                                |   |                                     | 63,511    |   |              |   | 39,927 |   |
| Restricted cash and marketable securities                                                                                                                                                                                                |   |                                     | 9,688     |   |              |   | 19,732 |   |
| Distributions receivable                                                                                                                                                                                                                 |   |                                     | 2,155     |   |              |   | 5,275 |   |
| Tenant and other receivables                                                                                                                                                                                                             |   |                                     | 48,472    |   |              |   | 43,012 |   |
| Intangible lease assets, net                                                                                                                                                                                                             |   |                                     | 333,748   |   |              |   | 370,049 |   |
| Deferred leasing costs, net                                                                                                                                                                                                              |   |                                     | 48,337    |   |              |   | 47,982 |   |
| Deferred financing costs, net                                                                                                                                                                                                            |   |                                     | 9,045     |   |              |   | 8,993 |   |
| Other assets                                                                                                                                                                                                                             |   |                                     | 29,684    |   |              |   | 7,086 |   |
| TOTAL ASSETS                                                                                                                                                                                                                             |   | $                                        | 3,314,254 |   |              | $      | 3,280,437 |   |
|                                                                                                                                                                                                                                     |   |                                     |      |   |              |   |   |   |
| LIABILITIES AND EQUITY                                                                                                                                                                                                                   |   |                                     |      |   |              |   |   |   |
|                                                                                                                                                                                                                                     |   |                                     |      |   |              |   |   |   |
| Liabilities:                                                                                                                                                                                                                             |   |                                     |      |   |              |   |   |   |
| Accounts payable and accrued expenses                                                                                                                                                                                                    |   | $                                        | 73,638    |   |              | $      | 93,364 |   |
| Due to affiliates                                                                                                                                                                                                                        |   |                                     | 5,698     |   |              |   | 9,515 |   |
| Intangible lease liabilities, net                                                                                                                                                                                                        |   |                                     | 102,304   |   |              |   | 112,371 |   |
| Other liabilities                                                                                                                                                                                                                        |   |                                     | 19,133    |   |              |   | 21,643 |   |
| Interest rate swap contracts                                                                                                                                                                                                             |   |                                     | 69,283    |   |              |   | 116,074 |   |
| Participation interest liability                                                                                                                                                                                                         |   |                                     | 50,340    |   |              |   | 45,419 |   |
| Distributions payable                                                                                                                                                                                                                    |   |                                     | 33,570    |   |              |   | 32,990 |   |
| Notes payable                                                                                                                                                                                                                            |   |                                     | 1,590,843 |   |              |   | 1,529,842 |   |
| Total liabilities                                                                                                                                                                                                                        |   |                                     | 1,944,809 |   |              |   | 1,961,218 |   |
|                                                                                                                                                                                                                                     |   |                                     |      |   |              |   |   |   |
| Commitments and contingencies (Note 10)                                                                                                                                                                                                  |   |                                     |      |   |              |   |   |   |
|                                                                                                                                                                                                                                     |   |                                     |      |   |              |   |   |   |
| Equity:                                                                                                                                                                                                                                  |   |                                     |      |   |              |   |   |   |
| Shareholders’ equity:                                                                                                                                                                                                              |   |                                     |      |   |              |   |   |   |
| Preferred shares, $.001 par value; 500,000 preferred shares authorized, none issued or outstanding as of  June 30, 2009 and December 31, 2008                                                                        |   |                                     | —   |   |              |   | — |   |
| Common shares, $.001 par value; 1,500,000 common shares authorized as of June 30, 2009 and December 31, 2008; 207,164 and 201,743 common shares issued and outstanding as of June 30, 2009 and December 31, 2008, respectively |   |                                     | 207       |   |              |   | 202 |   |
| Additional paid-in capital                                                                                                                                                                                                               |   |                                     | 1,623,357 |   |              |   | 1,629,033 |   |
| Retained deficit                                                                                                                                                                                                                         |   |                                     | (277,919  | )      |              |   | (303,323 | ) |
| Accumulated other comprehensive income (loss)                                                                                                                                                                                            |   |                                     | 23,800    |   |              |   | (6,693 | ) |
| Shareholders’ equity                                                                                                                                                                                                               |   |                                     | 1,369,445 |   |              |   | 1,319,219 |   |
| Noncontrolling interests                                                                                                                                                                                                                 |   |                                     | —   |   |              |   | — |   |
| Total equity                                                                                                                                                                                                                             |   |                                     | 1,369,445 |   |              |   | 1,319,219 |   |
| TOTAL LIABILITIES AND EQUITY                                                                                                                                                                                                             |   | $                                        | 3,314,254 |   |              | $      | 3,280,437 |   |

----

|                                                                                                                                       |   | Three Months Ended June 30,              | Six Months Ended June 30, |   |
|--------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------|---------------------------|--------|
|                                                                                                                                       |   | 2009                                     | 2008                      |   |   | 2009 | 2008 |   |
|                                                                                                                                       |   | (In thousands, except per share amounts) |
| Revenues:                                                                                                                                  |   |                                     |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Rental revenue                                                                                                                             |   | $                                        | 83,369                    |   |   | $ | 78,278 |   |   | $ | 168,718 |   |   | $ | 143,078 |   |
| Other revenue                                                                                                                              |   |                                     | 6,547                     |   |   |   | 6,942 |   |   |   | 13,219 |   |   |   | 12,276 |   |
|    Total revenues                                                                                                           |   |                                     | 89,916                    |   |   |   | 85,220 |   |   |   | 181,937 |   |   |   | 155,354 |   |
| Expenses:                                                                                                                                  |   |                                     |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Property operating expenses                                                                                                                |   |                                     | 22,802                    |   |   |   | 21,841 |   |   |   | 45,274 |   |   |   | 40,124 |   |
| Real property taxes                                                                                                                        |   |                                     | 10,629                    |   |   |   | 11,859 |   |   |   | 23,057 |   |   |   | 21,622 |   |
| Property management fees                                                                                                                   |   |                                     | 2,043                     |   |   |   | 1,786 |   |   |   | 4,130 |   |   |   | 3,371 |   |
| Depreciation and amortization                                                                                                              |   |                                     | 31,010                    |   |   |   | 32,216 |   |   |   | 62,788 |   |   |   | 57,597 |   |
| Asset management and acquisition fees                                                                                                      |   |                                     | 8,498                     |   |   |   | 9,284 |   |   |   | 13,112 |   |   |   | 17,694 |   |
| Organizational and offering expenses                                                                                                       |   |                                     | —                   |   |   |   | 1,695 |   |   |   | — |   |   |   | 3,614 |   |
| General and administrative expenses                                                                                                        |   |                                     | 1,630                     |   |   |   | 1,813 |   |   |   | 3,083 |   |   |   | 3,093 |   |
|    Total expenses                                                                                                           |   |                                     | 76,612                    |   |   |   | 80,494 |   |   |   | 151,444 |   |   |   | 147,115 |   |
| Income before other income (expenses), (provision) benefit for income taxes and equity in losses of unconsolidated entities, net |   |                                     | 13,304                    |   |   |   | 4,726 |   |   |   | 30,493 |   |   |   | 8,239 |   |
| Other income (expenses):                                                                                                                   |   |                                     |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gain (loss) on derivative instruments, net                                                                                                 |   |                                     | 35,895                    |   |   |   | 26,780 |   |   |   | 46,791 |   |   |   | (665 | ) |
| Other losses                                                                                                                          |   |                                     | —                   |   |   |   | — |   |   |   | (11 | ) |   |   | (2 | ) |
| Interest expense                                                                                                                           |   |                                     | (23,005                   | )      |   |   | (20,900 | ) |   |   | (45,594 | ) |   |   | (38,952 | ) |
| Interest income                                                                                                                            |   |                                     | 96                        |   |   |   | 361 |   |   |   | 375 |   |   |   | 1,610 |   |
| Income (loss) before (provision) benefit for income taxes and equity in losses of unconsolidated entities, net                   |   |                                     | 26,290                    |   |   |   | 10,967 |   |   |   | 32,054 |   |   |   | (29,770 | ) |
| (Provision) benefit for income taxes                                                                                                       |   |                                     | (246                      | )      |   |   | 51 |   |   |   | (505 | ) |   |   | (464 | ) |
| Equity in losses of unconsolidated entities, net                                                                                           |   |                                     | (2,495                    | )      |   |   | (2,181 | ) |   |   | (4,197 | ) |   |   | (4,116 | ) |
| Net income (loss)                                                                                                                          |   | $                                        | 23,549                    |   |   | $ | 8,837 |   |   | $ | 27,352 |   |   | $ | (34,350 | ) |
|   Less: Net income attributable to noncontrolling interests                                                                      |   |                                     | (1,012                    | )      |   |   | (732 | ) |   |   | (1,948 | ) |   |   | (1,375 | ) |
| Net income (loss) attributable to common shareholders                                                                                      |   | $                                        |  22,537              |   |   | $ |  8,105 |   |   | $ |  25,404 |   |   | $ |  (35,725 | ) |
| Basic and diluted income (loss) per common share:                                                                                          |   |                                     |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (loss) per common share                                                                                                             |   | $                                        | 0.11                      |   |   | $ | 0.05 |   |   | $ | 0.13 |   |   | $ | (0.21 | ) |
| Weighted average number of common shares outstanding                                                                                       |   |                                     | 204,152                   |   |   |   | 178,536 |   |   |   | 202,797 |   |   |   | 171,840 |   |

----

|                                                                                                                        |   |   |      |   | Hines Real Estate Investment Trust, Inc. |   |    |   |   |
|-----------------------------------------------------------------------------------------------------------------------------|--------|--------|-----------|--------|------------------------------------------|--------|---------|--------|--------|
|                                                                                                                        |   | Total  |      |   | Common Shares                            |   |    | Amount |   |   | Additional Paid-In Capital |   |   | Total Comprehensive Income – Shareholders |   | AccumulatedDeficit |   |   | Accumulated Other Comprehensive Income (Loss) |   |   | Noncontrolling Interests |   |
| BALANCE, January 1, 2009                                                                                                    |   | $      | 1,319,219 |   |                                     |   | 201,743 |   |   | $ | 202 |   |   | $ | 1,629,033 |   |   | $ | (310,016 | ) | $ | (303,323 | ) |   | $ | (6,693 | ) |   | $ | — |   |
| Issuance of common shares                                                                                                   |   |   | 169,296   |   |                                     |   | 16,879  |   |   |   | 16 |   |   |   | 169,280 |   |   |   | — |   |   | — |   |   |   | — |   |   |   | — |   |
| Redemption of common shares                                                                                                 |   |   | (99,265   | )      |                                     |   | (11,458 | )      |   |   | (11 | ) |   |   | (99,254 | ) |   |   | — |   |   | — |   |   |   | — |   |   |   | — |   |
| Distributions declared                                                                                                      |   |   | (66,290   | )      |                                     |   | — |   |   |   | — |   |   |   | (64,342 | ) |   |   | — |   |   | — |   |   |   | — |   |   |   | (1,948 | ) |
| Selling commissions and dealer manager fees                                                                                 |   |   | (11,360   | )      |                                     |   | — |   |   |   | — |   |   |   | (11,360 | ) |   |   | — |   |   | — |   |   |   | — |   |   |   | — |   |
| Comprehensive income (loss):                                                                                                |   |   |      |   |                                     |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Net Income                                                                                                      |   |   | 27,352    |   |                                     |   | — |   |   |   | — |   |   |   | — |   |   |   | 25,404 |   |   | 25,404 |   |   |   | — |   |   |   |   1,948 |   |
|   Other  comprehensive   income   – Foreign currency translation   adjustment |   |   | 30,493    |   |                                     |   | — |   |   |   | — |   |   |   | — |   |   |   | 30,493 |   |   | — |   |   |   | 30,493 |   |   |   | —  |   |
| Total Comprehensive Income                                                                                                  |   |   | 57,845    |   |                                     |   | — |   |   |   | — |   |   |   | — |   |   |   | 55,897 |   |   | — |   |   |   | — |   |   |   | 1,948 |   |
| BALANCE, June 30, 2009                                                                                                      |   | $      | 1,369,445 |   |                                     |   | 207,164 |   |   | $ | 207 |   |   | $ | 1,623,357 |   |   | $  | (254,119 | )  | $ | (277,919 | ) |   | $ | 23,800 |   |   | $ | — |   |

|                                                                                                           |   | Total  |               |    | Common Shares |   |          | Amount |   |   | Additional Paid-In Capital |   |   | Total Comprehensive Income – Shareholders |         | AccumulatedDeficit |   |    | Accumulated Other Comprehensive Income (Loss) |    |   | Noncontrolling Interests |    |
|----------------------------------------------------------------------------------------------------------------|--------|--------|--------------------|---------|---------------|--------|---------------|--------|--------|--------|----------------------------|--------|--------|-----------------------------------------------------------|--------------|--------------------|--------|---------|-----------------------------------------------|---------|--------|--------------------------|---------|
| BALANCE, January 1, 2008                                                                                       |   | $      | 1,233,276          |    |          |   | 159,409       |   |   | $      | 159                        |   |   | $                                                         | 1,358,523    |               |   | $       | (125,406                                      | )       | $      | (137,915                 | )       |   | $ | 12,509 |   |   | $ | — |   |
| Issuance of common shares                                                                                      |   |   | 338,683            |    |          |   | 32,260        |   |   |   | 33                         |   |   |                                                      | 338,650      |               |   |    | —                                       |    |   | —                  |    |   |   | — |   |   |   | — |   |
| Redemption of common shares                                                                                    |   |   | (17,100            | )       |          |   | (1,796        | )      |   |   | (2                         | )      |   |                                                      | (17,098      | )                  |   |    | —                                       |    |   | —                  |    |   |   | — |   |   |   | — |   |
| Distributions declared                                                                                         |   |   | (53,964            | )       |          |   | —       |   |   |   | —                    |   |   |                                                      | (52,589      | )                  |   |    | —                                       |    |   | —                  |    |   |   | — |   |   |   | (1,375 | ) |
| Selling commissions and dealer manager fees                                                                    |   |   | (27,528            | )       |          |   | —       |   |   |   | —                    |   |   |                                                      | (27,528      | )                  |   |    | —                                       |    |   | —                  |    |   |   | — |   |   |   | — |   |
| Other offering costs, net                                                                                      |   |   |   (4,200 | )  |          |   |  — |   |   |   |  —              |   |   |                                                      |  (4,200 | )                  |   |    | —                                       |    |   | —                  |    |   |   | — |   |   |   | — |   |
| Comprehensive income (loss):                                                                                   |   |   |               |    |          |   |          |   |   |   |                       |   |   |                                                      |         |               |   |    |                                          |    |   |                     |    |   |   |   |   |   |   |   |   |
|   Net Income                                                                                         |   |   | (34,350            | )  |          |   | —       |   |   |   | —                    |   |   |                                                      | —      |               |   |    | (35,725                                       | )  |   | (35,725                  | )  |   |   | — |   |   |   |   1,375 |   |
|   Other  comprehensive income –  Foreign currency translation   adjustment |   |   | 1,611              |    |          |   | —       |   |   |   | —                    |   |   |                                                      | —      |               |   |    | 1,611                                         |    |   | —                  |    |   |   | 1,611 |   |   |   | —  |   |
| Total Comprehensive Income                                                                                     |   |   | (32,739            | )       |          |   | —       |   |   |   | —                    |   |   |                                                      | —      |               |   |    | (34,114                                       | )       |   | —                  |    |   |   | — |   |   |   | 1,375 |   |
| BALANCE, June 30, 2008                                                                                         |   | $      | 1,436,428          |    |          |   | 189,873       |   |   | $      | 190                        |   |   | $                                                         | 1,595,758    |               |   | $  | (159,520                                      | )  | $      | (173,640                 | )       |   | $ | 14,120 |   |   | $ | — |   |

----

|                                                                                     |   | 2009           |     |   | 2008   |   |
|------------------------------------------------------------------------------------------|--------|----------------|----------|--------|--------|--------|
| CASH FLOWS FROM OPERATING ACTIVITIES:                                                    |   | (In thousands) |     |
| Net income (loss)                                                                        |   | $              | 27,352   |   |   | $      | (34,350 | ) |
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: |   |           |     |   |   |   |   |   |
| Depreciation and amortization                                                            |   |           | 59,915   |   |   |   | 57,405 |   |
| Non-cash compensation expense                                                            |   |           | 19       |   |   |   | 14 |   |
| Equity in losses of unconsolidated entities, net                                         |   |           | 4,197    |   |   |   | 4,116 |   |
| Distributions received from unconsolidated entities                                      |   |           | 1,028    |   |   |   | 969 |   |
| Accrual of organizational and offering expenses                                          |   |           | —  |   |   |   | 3,614 |   |
| Other losses                                                                             |   |           | 11       |   |   |   | 2 |   |
| (Gain) loss on derivative instruments                                                    |   |           | (46,791  | )      |   |   | 665 |   |
| Net change in operating accounts                                                         |   |           | (25,741  | )      |   |   | (14,008 | ) |
| Net cash provided by operating activities                                                |   |           | 19,990   |   |   |   | 18,427 |   |
| CASH FLOWS FROM INVESTING ACTIVITIES:                                                    |   |           |     |   |   |   |   |   |
| Investments in unconsolidated entities                                                   |   |           | (23,066  | )      |   |   | — |   |
| Distributions received from unconsolidated entities in excess of equity in earnings      |   |           | 9,006    |   |   |   | 13,246 |   |
| Investments in property                                                                  |   |           | (4,262   | )      |   |   | (433,750 | ) |
| Investments in master leases                                                             |   |           | —  |   |   |   | (1,917 | ) |
| Master lease rent receipts                                                               |   |           | 1,200    |   |   |   | 2,785 |   |
| Deposit proceeds from pending land sale                                                  |   |           | 803      |   |   |   | — |   |
| (Increase) decrease in restricted cash and marketable securities                         |   |           | 10,170   |   |   |   | (4,873 | ) |
| Change in acquired lease intangibles                                                     |   |           | —  |   |   |   | (86,042 | ) |
| Net cash used in investing activities                                                    |   |           | (6,149   | )      |   |   | (510,551 | ) |
| CASH FLOWS FROM FINANCING ACTIVITIES:                                                    |   |           |     |   |   |   |   |   |
| Increase (decrease) in other liabilities                                                 |   |           | 339      |   |   |   | (1,097 | ) |
| Proceeds from issuance of common stock                                                   |   |           | 134,009  |   |   |   | 300,615 |   |
| Redemptions of common shares                                                             |   |           | (107,186 | )      |   |   | (17,100 | ) |
| Increase in other assets                                                                 |   |           | (25,634  | )      |   |   | — |   |
| Payments of selling commissions and dealer manager fees                                  |   |           | (11,269  | )      |   |   | (25,430 | ) |
| Payments of organizational and offering expenses                                         |   |           | (9       | )      |   |   | (8,319 | ) |
| Distributions paid to shareholders and noncontrolling interests                          |   |           | (31,363  | )      |   |   | (23,361 | ) |
| Proceeds from notes payable                                                              |   |           | 204,000  |   |   |   | 520,000 |   |
| Payments on notes payable                                                                |   |           | (152,603 | )      |   |   | (269,238 | ) |
| Additions to deferred financing costs                                                    |   |           | (1,241   | )      |   |   | (1,444 | ) |
| Net cash provided by financing activities                                                |   |           | 9,043    |   |   |   | 474,626 |   |
| Effect of exchange rate changes on cash                                                  |   |           | 700      |   |   |   | (132 | ) |
| Net change in cash and cash equivalents                                                  |   |           | 23,584   |   |   |   | (17,630 | ) |
| Cash and cash equivalents, beginning of period                                           |   |           | 39,927   |   |   |   | 152,443 |   |
| Cash and cash equivalents, end of period                                                 |   | $              | 63,511   |   |   | $      | 134,813 |   |

----

----

----

| Effective Date        | Expiration Date  |   | Notional Amount |    |  Interest Rate Received |                      | Interest Rate Paid |   |
|-----------------------|------------------|--------|-----------------|---------|------------------------------|---------------------------|--------------------|--------|
| August 1, 2006   | August 1, 2016   |   | $               | 185,000 |                         |  Libor + 0.45%       |               |   | 5.8575 | % |
| January 12, 2007 | January 12, 2017 |   |            | 98,000  |                         |  Libor + 0.40%  |               |   | 5.2505 | % |
| May 2, 2007      | May 2, 2017      |   |            | 119,000 |                         |  Libor + 0.40%  |               |   | 5.3550 | % |
| July 19, 2007    | July 19, 2017    |   |            | 48,000  |                         |  Libor + 0.40%  |               |   | 5.9800 | % |
| August 14, 2007  | August 14, 2017  |   |            | 70,000  |                         |  Libor + 0.40%  |               |   | 6.0300 | % |

|                                |   | June 30, 2009 |    |   | December 31, 2008 |   |
|-------------------------------------|--------|---------------|---------|--------|-------------------|--------|
| Property acquisition escrow deposit |   | $             | — |   |              | $      | 4,885 |   |
| Prepaid insurance                   |   |          | 2,649   |   |              |   | 1,221 |   |
| Other (1)                           |   |          | 27,035  |   |              |   | 980 |   |
| Total                               |   | $             | 29,684  |   |              | $      | 7,086 |   |

| (1)   | On June 30, 2009 the Company funded $25.6 million to its transfer agent related to shareholder redemptions and distributions that were subsequently paid on July 1, 2009. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| Property                            | City                       |   | Date Acquired |    |   | Leasable Square Feet |       |      | Percent Leased |   |   | Our EffectiveOwnership(1) |   |   |   |
|-------------------------------------|----------------------------|--------|---------------|---------|--------|----------------------|------------|-----------|----------------|--------|--------|---------------------------|--------|--------|--------|
|                                |                       |   |          |    |   |                 |       |      |           |   |   |                      |
| 321 North Clark                     | Chicago, Illinois          |   |          | 04/2006 |   |                 |       | 885,664   |           |   |   | 99                        | %      |   |   | 100 | % |
| Distribution Park Araucaria         | Curitiba, Brazil           |   |          | 12/2008 |   |                 |       | 459,587   |           |   |   | 100                       | %      |   |   | 100 | % |
| Citymark                            | Dallas, Texas              |   |          | 08/2005 |   |                 |       | 220,079   |           |   |   | 99                        | %      |   |   | 100 | % |
| 4055/4055 Corporate Drive           | Dallas, Texas              |   |          | 05/2008 |   |                 |       | 643,429   |           |   |   | 100                       | %      |   |   | 100 | % |
| JPMorgan Chase Tower                | Dallas, Texas              |   |          | 11/2007 |   |                 |       | 1,248,551 |           |   |   | 88                        | %      |   |   | 100 | % |
| 345 Inverness Drive                 | Denver, Colorado           |   |          | 12/2008 |   |                 |       | 175,287   |           |   |   | 100                       | %      |   |   | 100 | % |
| Arapahoe Business Park              | Denver, Colorado           |   |          | 12/2008 |   |                 |       | 309,450   |           |   |   | 91                        | %      |   |   | 100 | % |
| Raytheon/DIRECTV Buildings          | El Segundo, California     |   |          | 03/2008 |   |                 |       | 550,579   |           |   |   | 100                       | %      |   |   | 100 | % |
| Watergate Tower IV                  | Emeryville, California     |   |          | 12/2006 |   |                 |       | 344,433   |           |   |   | 100                       | %      |   |   | 100 | % |
| Williams Tower                      | Houston, Texas             |   |          | 05/2008 |   |                 |       | 1,480,623 |           |   |   | 82                        | %      |   |   | 100 | % |
| 2555 Grand                          | Kansas City, Missouri      |   |          | 02/2008 |   |                 |       | 595,607   |           |   |   | 100                       | %      |   |   | 100 | % |
| One Wilshire                        | Los Angeles, California    |   |          | 08/2007 |   |                 |       | 661,553   |           |   |   | 98                        | %      |   |   | 100 | % |
| 3 Huntington Quadrangle             | Melville, New York         |   |          | 07/2007 |   |                 |       | 407,731   |           |   |   | 87                        | %      |   |   | 100 | % |
| Airport Corporate Center            | Miami, Florida             |   |          | 01/2006 |   |                 |       | 1,021,397 |           |   |   | 89                        | %      |   |   | 100 | % |
| Minneapolis Office/Flex Portfolio   | Minneapolis, Minnesota     |   |          | 09/2007 |   |                 |       | 766,210   |           |   |   | 82                        | %      |   |   | 100 | % |
| 3400 Data Drive                     | Rancho Cordova, California |   |          | 11/2006 |   |                 |       | 149,703   |           |   |   | 100                       | %      |   |   | 100 | % |
| Daytona Buildings                   | Redmond, Washington        |   |          | 12/2006 |   |                 |       | 251,313   |           |   |   | 100                       | %      |   |   | 100 | % |
| Laguna Buildings                    | Redmond, Washington        |   |          | 01/2007 |   |                 |       | 464,701   |           |   |   | 100                       | %      |   |   | 100 | % |
| 1515 S Street             | Sacramento, California     |   |          | 11/2005 |   |                 |       | 348,881   |           |   |   | 99                        | %      |   |   | 100 | % |
| 1900 and 2000 Alameda               | San Mateo, California |   |          | 06/2005 |   |                 |       | 253,187   |           |   |   | 95                        | %      |   |   | 100 | % |
| Distribution Park Elouveira         | Sao Paulo, Brazil          |   |          | 12/2008 |   |                 |       | 534,794   |           |   |   | 100                       | %      |   |   | 100 | % |
| Distribution Park Vinhedo           | Sao Paulo, Brazil          |   |          | 12/2008 |   |                 |       | 609,474   |           |   |   | 100                       | %      |   |   | 100 | % |
| Seattle Design Center               | Seattle, Washington        |   |          | 06/2007 |   |                 |       | 390,684   |           |   |   | 86                        | %      |   |   | 100 | % |
| 5th and Bell                   | Seattle, Washington        |   |          | 06/2007 |   |                 |       | 197,135   |           |   |   | 98                        | %      |   |   | 100 | % |
| Atrium on Bay                       | Toronto, Ontario           |   |          | 02/2007 |   |                 |       | 1,078,669 |           |   |   | 98                        | %      |   |   | 100 | % |
| Total for Directly-Owned Properties |                       |   |          |    |   |                 | 14,048,721 |      |           |   | 94     | %                         |   |   |   |   |
|                                |                       |   |          |    |   |                 |       |      |           |   |   |                      |   |   |   |   |   |
| Indirect Investments                |                       |   |          |    |   |                 |       |      |           |   |   |                      |   |   |   |   |   |
|                                |                       |   |          |    |   |                 |       |      |           |   |   |                      |   |   |   |   |   |
| Core Fund Investment      |                       |   |          |    |   |                 |       |      |           |   |   |                      |   |   |   |   |   |
| One Atlantic Center                 | Atlanta, Georgia           |   |          | 07/2006 |   |                 |       | 1,100,312 |           |   |   | 77                        | %      |   |   | 23.20 | % |
| The Carillon Building               | Charlotte, North Carolina  |   |          | 07/2007 |   |                 |       | 471,231   |           |   |   | 78                        | %      |   |   | 23.20 | % |
| Charlotte Plaza                     | Charlotte, North Carolina  |   |          | 06/2007 |   |                 |       | 625,026   |           |   |   | 94                        | %      |   |   | 23.20 | % |
| One North Wacker                    | Chicago, Illinois          |   |          | 03/2008 |   |                 |       | 1,373,754 |           |   |   | 97                        | %      |   |   | 23.20 | % |
| Three First National Plaza          | Chicago, Illinois          |   |          | 03/2005 |   |                 |       | 1,420,611 |           |   |   | 92                        | %      |   |   | 18.56 | % |
| 333 West Wacker                | Chicago, Illinois          |   |          | 04/2006 |   |                 |       | 845,362   |           |   |   | 92                        | %      |   |   | 18.51 | % |
| One Shell Plaza                     | Houston, Texas             |   |          | 05/2004 |   |                 |       | 1,230,395 |           |   |   | 100                       | %      |   |   | 11.60 | % |
| Two Shell Plaza                     | Houston, Texas             |   |          | 05/2004 |   |                 |       | 565,553   |           |   |   | 95                        | %      |   |   | 11.60 | % |
| 425 Lexington Avenue                | New York, New York         |   |          | 08/2003 |   |                 |       | 700,034   |           |   |   | 100                       | %      |   |   | 11.67 | % |
| 499 Park Avenue                     | New York, New York         |   |          | 08/2003 |   |                 |       | 291,480   |           |   |   | 76                        | %      |   |   | 11.67 | % |
| 600 Lexington Avenue                | New York, New York         |   |          | 02/2004 |   |                 |       | 286,985   |           |   |   | 94                        | %      |   |   | 11.67 | % |
| Renaissance Square                  | Phoenix, Arizona           |   |          | 12/2007 |   |                 |       | 965,508   |           |   |   | 89                        | %      |   |   | 23.20 | % |
| Riverfront Plaza                    | Richmond, Virginia         |   |          | 11/2006 |   |                 |       | 951,590   |           |   |   | 92                        | %      |   |   | 23.20 | % |
| Johnson Ranch Corporate Centre      | Roseville, California      |   |          | 05/2007 |   |                 |       | 179,990   |           |   |   | 65                        | %      |   |   | 18.51 | % |
| Roseville Corporate Center          | Roseville, California      |   |          | 05/2007 |   |                 |       | 111,418   |           |   |   | 71                        | %      |   |   | 18.51 | % |
| Summit at Douglas Ridge             | Roseville, California      |   |          | 05/2007 |   |                 |       | 185,128   |           |   |   | 69                        | %      |   |   | 18.51 | % |
| Olympus Corporate Centre            | Roseville, California      |   |          | 05/2007 |   |                 |       | 191,494   |           |   |   | 47                        | %      |   |   | 18.51 | % |
| Douglas Corporate Center            | Roseville, California      |   |          | 05/2007 |   |                 |       | 214,606   |           |   |   | 78                        | %      |   |   | 18.51 | % |

----

| Property                             | City                           |   | Date Acquired |          |   | Leasable Square Feet |       |          | Percent Leased |   |   | Our EffectiveOwnership(1) |    |   |   |
|--------------------------------------|--------------------------------|--------|---------------|---------------|--------|----------------------|------------|---------------|----------------|--------|--------|---------------------------|---------|--------|--------|
|                                 |                           |   |          |          |   |                 |       |          |           |   |   |                      |
| Wells Fargo Center                   | Sacramento, California         |   |          |  05/2007 |   |                 |       |  502,365 |           |   |   |  97                  | %  |   |   |  18.51 | %  |
| 525 B Street               | San Diego, California     |   |          |  08/2005 |   |                 |       |  448,275 |           |   |   |  81                  | %  |   |   |  18.51 | %  |
| The KPMG Building                    | San Francisco, California |   |          |  09/2004 |   |                 |       |  379,328 |           |   |   |  100                 | %  |   |   |  23.20 | %  |
| 101 Second Street                    | San Francisco, California |   |          |  09/2004 |   |                 |       |  388,370 |           |   |   |  84                  | %  |   |   |  23.20 | %  |
| 720 Olive Way                        | Seattle, Washington            |   |          | 01/2006       |   |                 |       |  300,710 |           |   |   |  90                  | %  |   |   |  18.51 | %  |
| 1200 19th Street                     | Chicago, Illinois              |   |          | 08/2003       |   |                 |       | 337,239       |           |   |   | 32                        | %(2)    |   |   | 11.67 | % |
| Warner Center                   | Curitiba, Brazil               |   |          | 10/2006       |   |                 |       | 808,274       |           |   |   | 90                        | %       |   |   | 18.51 | % |
| Total for Core Fund Properties       |                           |   |          |          |   |                 | 14,875,038 |          |           |   | 88     | %                         |    |   |   |   |
|                                 |                           |   |          |          |   |                 |       |          |           |   |   |                      |    |   |   |   |   |
| Grocery-Anchored Portfolio           |                           |   |          |          |   |                 |       |          |           |   |   |                      |    |   |   |   |   |
| Cherokee Plaza                       | Atlanta, Georgia               |   |          | 11/2008       |   |                 |       | 99,749        |           |   |   | 100                       | %       |   |   | 70 | % |
| Bellaire Boulevard Center            | Bellaire, Texas                |   |          | 11/2008       |   |                 |       | 35,081        |           |   |   | 100                       | %       |   |   | 70 | % |
| Thompson Bridge Commons              | Gainesville, Georgia           |   |          | 03/2009       |   |                 |       | 92,587        |           |   |   | 96                        | %       |   |   | 70 | % |
| Champions Village                    | Houston, Texas                 |   |          | 11/2008       |   |                 |       | 384,581       |           |   |   | 91                        | %       |   |   | 70 | % |
| King’s Crossing                | Kingwood, Texas                |   |          | 11/2008       |   |                 |       | 126,397       |           |   |   | 97                        | %       |   |   | 70 | % |
| Sandy Plains Exchange                | Marietta, Georgia              |   |          | 02/2009       |   |                 |       | 72,784        |           |   |   | 93                        | %       |   |   | 70 | % |
| Commons at Dexter Lakes              | Memphis, Tennessee             |   |          | 11/2008       |   |                 |       | 228,496       |           |   |   | 95                        | %       |   |   | 70 | % |
| Mendenhall Commons                   | Memphis, Tennessee             |   |          | 11/2008       |   |                 |       | 79,871        |           |   |   | 99                        | %       |   |   | 70 | % |
| University Palms Shopping Center     | Oviedo, Florida                |   |          | 11/2008       |   |                 |       | 99,172        |           |   |   | 90                        | %       |   |   | 70 | % |
| Shoppes at Parkland                  | Parkland, Florida              |   |          | 03/2009       |   |                 |       | 145,652       |           |   |   | 93                        | %       |   |   | 70 | % |
| Oak Park Village                     | San Antonio, Texas             |   |          | 11/2008       |   |                 |       | 64,287        |           |   |   | 100                       | %       |   |   | 70 | % |
| Heritage Stations                    | Wake Forest, North Carolina    |   |          | 01/2009       |   |                 |       | 68,778        |           |   |   | 96                        | %       |   |   | 70 | % |
| Total for Grocery-Anchored Portfolio |                           |   |          |          |   |                 | 1,497,435  |          |           |   | 95     | %                         |    |   |   |   |
|                                 |                           |   |          |          |   |                 |       |          |           |   |   |                      |    |   |   |   |   |
| Other                                |                           |   |          |          |   |                 |       |          |           |   |   |                      |    |   |   |   |   |
| Distribution Park Rio                | Rio de Janeiro, Brazil         |   |          | 07/2007       |   |                 |       | 693,115       |           |   |   | 99                        | %       |   |   | 50 | % |
| Total for All Properties             |                           |   |          |          |   |                 | 31,114,309 |          |           |   | 91     | %(3)                      |    |   | 11.60  | % |

| (1)    | This percentage shows the effective ownership of the Operating Partnership in the properties listed. On June 30, 2009, Hines REIT owned a 97.0% interest in the Operating Partnership as its sole general partner. Affiliates of Hines owned the remaining 3.0% interest in the Operating Partnership. In addition, the Company owned an approximate28.7% non-managing general partner interest in the Core Fund as of June 30, 2009. The Core Fund does not own 100% of these properties; its ownership interest in its properties ranges from 40.3% to 80.7%. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| (2)    | Redevelopment of this asset was completed in June 2009 in which three floors were added to the building. Efforts to lease this space are currently underway.                                                                                                                                                                                                                                                                                                                                                                                               |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| (3)    | This amount represents the percentage leased assuming the Company owns a 100% interest in each of these properties.  The percentage leased based on the Company’s effective ownership interest in each property is 93%.                                                                                                                                                                                                                                                                                                                         |

|                            |   | June 30, 2009 |      |   | December 31, 2008 |   |
|---------------------------------|--------|---------------|-----------|--------|-------------------|--------|
| Buildings and improvements      |   | $             | 2,016,510 |   |              | $      | 1,987,184  |   |
| Less: accumulated depreciation  |   |          | (101,687  | )      |              |   | (75,783)  |   |
| Buildings and improvements, net |   |          | 1,914,823 |   |              |   | 1,911,401 |   |
| Land                            |   |          | 469,052   |   |              |   | 462,606 |   |
| Investment property, net        |   | $             | 2,383,875 |   |              | $      | 2,374,007 |   |

----

|                           | Lease Intangibles |          |
|--------------------------------|-------------------|---------------|
|                           | In-Place Leases   |          |   | Out-of-Market Lease Assets |   |   | Out-of-Market Lease Liabilities |   |
| Cost                           | $                 |  420,886 |   |   | $ |  61,266 |   |   | $ |  138,177 |   |
| Less: accumulated amortization |              | (130,191      | ) |   |   | (18,213 | ) |   |   | (35,873 | ) |
| Net                            | $                 | 290,695       |   |   | $ | 43,053 |   |   | $ | 102,304 |   |

|                           | Lease Intangibles |          |
|--------------------------------|-------------------|---------------|
|                           | In-Place Leases   |          |   | Out-of-Market Lease Assets |   |   | Out-of-Market Lease Liabilities |   |
| Cost                           | $                 |  424,063 |   |   | $ |  61,228 |   |   | $ |  138,577 |   |
| Less: accumulated amortization |              | (100,453      | ) |   |   | (14,789 | ) |   |   | (26,206 | ) |
| Net                            | $                 | 323,610       |   |   | $ | 46,439 |   |   | $ | 112,371 |   |

|                             |   | In-Place Leases |   |   | Out-of-Market Leases, Net |   |
|----------------------------------|--------|-----------------|--------|--------|---------------------------|--------|
| July 1 through December 31, 2009 |   | $               | 33,139 |   |                      | $      | (6,543 | ) |
| 2010                             |   |            | 58,473 |   |                      |   | (12,071 | ) |
| 2011                             |   |            | 50,979 |   |                      |   | (11,150 | ) |
| 2012                             |   |            | 40,396 |   |                      |   | (10,199 | ) |
| 2013                             |   |            | 29,696 |   |                      |   | (8,539 | ) |

|                             |   | Fixed Future Minimum Rentals |      |
|----------------------------------|--------|------------------------------|-----------|
| July 1 through December 31, 2009 |   | $                            | 118,509   |   |
| 2010                             |   |                         | 211,847   |   |
| 2011                             |   |                         | 192,539   |   |
| 2012                             |   |                         | 168,538   |   |
| 2013                             |   |                         | 130,786   |   |
| Thereafter                       |   |                         | 501,926   |   |
| Total                            |   | $                            | 1,324,145 |   |

----

|                          | Core Fund |    | Grocery-Anchored Portfolio |    | Distribution Park Rio |    |    | Total   |   |
|-------------------------------|-----------|---------|----------------------------|---------|-----------------------|---------|---------|---------|--------|
| Balance as of January 1, 2009 | $         | 290,062 |                       | $       | 51,473                |    | $       | 22,839  |   |   | $ |  364,374 |   |
| Contributions                 |      | — |                       |    | 27,953                |    |    | — |   |   |   |  27,953 |   |
| Distributions declared        |      | (1,282  | )                          |    | (4,379                | )  |    | (1,255  | )      |   |   |  (6,916 | ) |
| Equity in earnings (losses)   |      | (5,225  | )                          |    | 31                    |    |    | 997     |   |   |   |  (4,197 | ) |
| Effect of exchange rate       |      | — |                       |    | —               |    |    | 4,525   |   |   |   | 4,525 |   |
| Balance as of June 30, 2009   | $    | 283,555 |                       | $  | 75,078                |    | $  | 27,106  |   |   | $ |  385,739 |   |

|                        | Core Fund |    | Grocery-Anchored Portfolio |    | Distribution Park Rio |    |    | Total     |   |
|-----------------------------|-----------|---------|----------------------------|---------|-----------------------|---------|---------|-----------|--------|
| Balance as of April 1, 2009 | $         | 287,281 |                       | $       | 72,138                |    | $       | 22,978    |   |   | $ |  382,397 |   |
| Contributions               |      | — |                       |    | 4,418                 |    |    | —   |   |   |   | 4,418 |   |
| Distributions declared      |      | (643    | )                          |    | (1,514                | )  |    | (732      | )      |   |   |  (2,889 | ) |
| Equity in earnings (losses) |      | (3,083  | )                          |    | 36                    |    |    |  552 |   |   |   |  (2,495 | ) |
| Effect of exchange rate     |      | — |                       |    | —               |    |    | 4,308     |   |   |   |  4,308 |   |
| Balance as of June 30, 2009 | $    | 283,555 |                       | $  | 75,078                |    | $  | 27,106    |   |   | $ |  385,739 |   |

|                          |   | Core Fund |    |   | DistributionPark Rio |   |    | Total  |   |
|-------------------------------|--------|-----------|---------|--------|----------------------|--------|---------|--------|--------|
| Balance as of January 1, 2008 |   | $         | 330,441 |   |                 | $      | 30,716  |   |   | $ | 361,157 |   |
| Contributions                 |   |      | — |   |                 |   | — |   |   |   | — |   |
| Distributions                 |   |      | (12,760 | )      |                 |   | (1,451  | )      |   |   | (14,211 | ) |
| Equity in earnings (losses)   |   |      | (5,085  | )      |                 |   | 969     |   |   |   | (4,116 | ) |
| Effect of exchange rate       |   |      | — |   |                 |   | 3,441   |   |   |   | 3,441 |   |
| Balance as of June 30, 2008   |   | $         | 312,596 |   |                 | $      | 33,675  |   |   | $ | 346,271 |   |

----

|                        |   | Core Fund |    |   | DistributionPark Rio |   |    | Total  |   |
|-----------------------------|--------|-----------|---------|--------|----------------------|--------|---------|--------|--------|
| Balance as of April 1, 2008 |   | $         | 322,196 |   |                 | $      | 30,783  |   |   | $ | 352,979 |   |
| Contributions               |   |      | — |   |                 |   | — |   |   |   | — |   |
| Distributions               |   |      | (6,886  | )      |                 |   | (688    | )      |   |   | (7,574 | ) |
| Equity in earnings (losses) |   |      | (2,714  | )      |                 |   | 533     |   |   |   | (2,181 | ) |
| Effect of exchange rate     |   |      | — |   |                 |   | 3,047   |   |   |   | 3,047 |   |
| Balance as of June 30, 2008 |   | $         | 312,596 |   |                 | $      | 33,675  |   |   | $ | 346,271 |   |

----

| Description                                                                  | Origination orAssumption Date |  Maturity Date |   | Interest Rate |           |    | Principal Outstanding at June 30, 2009 |   |            | Principal Outstanding at December 31, 2008 |
|------------------------------------------------------------------------------|-------------------------------|---------------------|--------|---------------|----------------|---------|----------------------------------------|--------|-----------------|-------------------------------------------------|
| SECURED MORTGAGE DEBT                                                        |                          |                |   |          |           |    |                                   |   |            |                                            |
| Wells Fargo Bank, N.A. — Airport Corporate Center                      | 1/31/2006                     | 3/11/2010           |   |          | 4.775          | %       |                                   | $      | 77,900          | (1)                                             |   | $ | 90,852 |
| Metropolitan Life Insurance Company — 1515 S. Street    | 4/18/2006                     | 5/1/2011            |   |          | 5.680          | %       |                                   |   | 45,000          | (2)                                             |   |   | 45,000 |
| Capmark Finance, Inc. — Atrium on Bay                             | 2/26/2007                     | 2/26/2017           |   |          | 5.330          | %       |                                   |   | 164,445         | (3)                                             |   |   | 155,477 |
| The Prudential Insurance Company of America — One Wilshire        | 10/25/2007                    | 11/1/2012           |   |          | 5.980          | %       |                                   |   | 159,500         |                                            |   |   | 159,500 |
| IXIS Real Estate Capital Inc. – Raytheon/ DIRECTV Buildings            | 3/13/2008                     | 12/5/2016           |   |          | 5.675          | %       |                                   |   | 52,209          | (4)                                             |   |   | 52,515 |
| New York State Teachers’ Retirement System – 2555 Grand          | 4/24/2008                     | 5/1/2013            |   |          | 5.375          | %       |                                   |   | 86,000          | (5)                                             |   |   | 86,000 |
| New York State Teachers’ Retirement System – Williams Tower      | 5/29/2008                     | 6/1/2013            |   |          | 5.500          | %       |                                   |   | 165,000         | (6)                                             |   |   | 165,000 |
| Artesia Mortgage Capital Corporation –  345 Inverness Drive  | 12/30/2008                    | 12/11/2016          |   |          | 5.850          | %       |                                   |   | 13,898          | (7)                                             |   |   | 13,790 |
| Artesia Mortgage Capital Corporation – Arapahoe Business Park I        | 12/30/2008                    | 6/11/2015           |   |          | 5.330          | %       |                                   |   | 8,759           | (8)                                             |   |   | 8,676 |
| Artesia Mortgage Capital Corporation – Arapahoe Business Park II       | 12/30/2008                    | 11/11/2015          |   |          | 5.530          | %       |                                   |   | 9,423           | (9)                                             |   |   | 9,411 |
| HSH POOLED MORTGAGE FACILITY                                            |                          |                |   |          |           |    |                                   |   |            |                                            |   |   |   |
| HSH Nordbank — Citymark, 321 North Clark, 1900 and 2000 Alameda   | 8/1/2006                      | 8/1/2016            |   |          | 5.8575         | %  | (10)                                   |   |  185,000   |                                            |   |   | 185,000 |
| HSH Nordbank — 3400 Data Drive, Watergate Tower IV                | 1/23/2007                     | 1/12/2017           |   |          |  5.2505   | %  | (10)                                   |   |  98,000    |                                            |   |   |  98,000 |
| HSH Nordbank — Daytona and Laguna Buildings                       | 5/2/2007                      |  5/2/2017      |   |          |  5.3550   | %  | (10)                                   |   |  119,000   |                                            |   |   |  119,000 |
| HSH Nordbank — 3 Huntington Quadrangle                            | 7/19/2007                     |  7/19/2017     |   |          |  5.9800   | %  | (10)                                   |   |  48,000    |                                            |   |   |  48,000 |
| HSH Nordbank — Seattle Design Center/5th and Bell                 | 8/14/2007                     | 8/14/2017           |   |          |  6.0300   | %  | (10)                                   |   |  70,000    |                                            |   |   |  70,000 |
| MET LIFE SECURED MORTGAGE FACILITY                                           |                          |                |   |          |           |    |                                   |   |            |                                            |   |   |   |
| Met Life — JPMorgan Chase Tower/Minneapolis Office/Flex Portfolio | 12/20/2007                    | 12/20/2012          |   |          |  5.70     | %  |                                   |   |  205,000   |                                            |   |   |  205,000 |
| OTHER NOTES PAYABLE                                                     |                          |                |   |          |           |    |                                   |   |            |                                            |   |   |   |
| KeyBank Revolving Credit Facility                                            | 9/9/2005                      | 10/31/2009          |   |          |  Variable |    |                                   |   | 81,000          | (11)                                            |   |   |  16,000 |
| Atrium Note Payable                                                          | 9/1/2004                      |  10/1/2011     |   |          |  7.390    | %  |                                   |   |  2,709     | (12)                                            |   |   |  2,621 |
|                                                                         |                          |                |   |          |           |    |                                   | $      |  1,590,843 |                                            |   | $ |  1,529,842 |

| (1)    | This interest-only loan's original principal amount of $91.0 million was assumed by the Company in connection with its acquisition of Airport Corporate Center. This mortgage matured on March 11, 2009 and was extended to March 11, 2010 with the option for an additional 6-month extension subject to certain conditions.  Concurrently,the Company made a principal payment of $13.1 million to reduce the outstanding principal balance to $77.9 million. All other significant terms and covenants of the loan remained the same, including the fixed interest rate of 4.775%. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| (2)    | The Company entered into mortgage financing in connection with its acquisition of 1515 S. Street. The mortgage agreement provided for an interest only loan with a principal amount of $45.0 million.                                                                                                                                                                                                                                                                                                                                                                                                |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| (3)    | The Company entered into mortgage financing in connection with its acquisition of Atrium on Bay. The mortgage agreement provided for an interest only loan with a principal amount of 190.0 million Canadian dollars. This amount was translated from Canadian dollars to U.S. dollars at a rate of $0.8655 as of June 30, 2009.                                                                                                                                                                                                                                                                               |

----

| (4)        | The Company assumed a mortgage note in the principal amount of $54.2 million in connection with its acquisition of the Raytheon/DirecTV Buildings. At the time of acquisition, the fair value of this mortgage was estimated to be $52.9 million, resulting in a discount of $1.3 million. The discount is being amortized over the term of the mortgage.                                                                             |
|------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| (5)        | The Company entered into an interest-only loan with the New York State Teachers’ Retirement System (“NYSTRS”) in the principal amount of $86.0 million secured by its interest in 2555 Grand.                                                                                                                                                                                                                       |
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| (6)        | The Company entered into an interest-only loan with NYSTRS in the principal amount of $165.0 million secured by its interest in Williams Tower.                                                                                                                                                                                                                                                                                  |
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| (7)        | The Company assumed a $15.5 million note in connection with its acquisition of 345 Inverness Drive. The note is interest-only until June 11, 2010, at which time the principal will begin amortizing until its maturity. At the time of acquisition, the fair value of this note was estimated to be $13.8 million, resulting in a discountof $1.7 million. The discount is being amortized over the term of the note. |
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| (8)        | The Company assumed a $9.8 million note in connection with its acquisition of Arapahoe Business Park I. The note is interest-only until June 11, 2010, at which time the principal will begin amortizing until its maturity. At the time of acquisition, the fair value of this note was estimated to be $8.7 million, resulting in a discount of$1.1 million. The discount is being amortized over the term of the note.   |
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| (9)        | The Company assumed a $10.5 million note in connection with its acquisition of Arapahoe Business Park II. At the time of acquisition, the fair value of this note was estimated to be $9.4 million, resulting in a discount of $1.1 million. The discount is being amortized over the term of the note.                                                                                                                     |
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| (10)       | The Company entered into an interest rate swap agreement which effectively fixed the interest rate of this borrowing at the specified rate. See Note 2 – Derivative Instruments for additional information regarding the Company’s derivatives.                                                                                                                                                                      |
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| (11)       | The weighted average interest rate on outstanding borrowings under this facility was 1.8% as of June 30, 2009. This facility is subject to extension at the election of the Company for two successive periods of one year each, subject to specified conditions. The Company expects to exercise its option to extend this facility prior to its maturityin October 2009.                                                            |
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| (12)  | Note with Citicorp Vendor Finance Ltd. related to installation of certain equipment at Atrium on Bay. This amount was translated to U.S. dollars at a rate of $0.8655 as of June 30, 2009.                                                                                                                                                                                                                                       |

| Distributions for the Quarter Ended                                    | Date Paid       |   | Total Distribution |   |
|------------------------------------------------------------------------|-----------------|--------|--------------------|--------|
|                                                                   |            |   | (In thousands)     |   |
|            2009      |            |   |               |   |
| June 30, 2009                                                          | July 1, 2009    |   | $                  | 33,570 |   |
| March 31, 2009                                                         | April 1, 2009   |   | $                  | 32,720 |   |
|                                                                   |            |   |               |   |   |
|            2008 |            |   |               |   |   |   |
| December 31, 2008                                                 | January 2, 2009 |   | $                  | 32,990 |   |
| September 30, 2008                                                | October 1, 2008 |   | $                  | 31,773 |   |
| June 30, 2008                                                     | July 1, 2008    |   | $                  | 29,002 |   |
| March 31, 2008                                                    | April 15, 2008  |   | $                  | 26,337 |   |

----

|                                                                                                              |   |                             |    |   |                             |   |    |                           |   |
|-------------------------------------------------------------------------------------------------------------------|--------|----------------------------------|---------|--------|----------------------------------|--------|---------|--------------------------------|--------|
|                                                                                                              |   | Incurred                         |    |   | Incurred                         |   |    | Unpaid as of                   |   |
|  Type and Recipient                                                                                          |   | Three Months Ended June 30, 2009 |    |   | Three Months Ended June 30, 2008 |   |    | Six Months Ended June 30, 2009 |   |   | Six Months Ended June 30, 2008 |   |   | June 30, 2009 |   |   | December 31, 2008 |   |
| Selling Commissions – the Dealer Manager                                                                    |   | $                                | 5,195   |   |                             | $      | 13,275  |                           |   | $ | 8,580 |   |   | $ | 20,698 |   |   | $ | 163 |   |   | $ | 135 |   |
| Dealer Manager Fee – the Dealer Manager                                                                     |   |                             | 1,668   |   |                             |   | 4,383   |                           |   |   | 2,780 |   |   |   | 6,830 |   |   |   | (30 | ) |   |   | (93 | ) |
| Organizational and Offering Costs -  the Advisor                                                        |   |                             | — |   |                             |   | 4,339   |                           |   |   | — |   |   |   | 7,814 |   |   |   | — |   |   |   | 9 |   |
| Acquisition Fee – the Advisor                                                                               |   |                             | — |   |                             |   | 1,572   |                           |   |   | 1,160 |   |   |   | 3,018 |   |   |   | — |   |   |   | 4,534 |   |
| Asset Management Fee – the Advisor                                                                          |   |                             | 3,549   |   |                             |   | 3,070   |                           |   |   | 7,031 |   |   |   | 5,829 |   |   |   | 3,541 |   |   |   | 1,141 |   |
| Participation Interest in the Operating Partnership – HALP Associates Limited Partnership                   |   |                             | 4,949   |   |                             |   | 4,642   |                           |   |   | 4,921 |   |   |   | 8,847 |   |   |   | 50,340 |   |   |   | 45,419 |   |
| Debt Financing Fee – the Advisor                                                                            |   |                             | — |   |                             |   | — |                           |   |   | 242 |   |   |   | — |   |   |   | — |   |   |   | 1,058 |   |
| Property Management Fee – Hines                                                                             |   |                             | 1,895   |   |                             |   | 1,789   |                           |   |   | 3,865 |   |   |   | 3,312 |   |   |   | 138 |   |   |   | (11 | ) |
| Leasing Fee – Hines                                                                                         |   |                             | 151     |   |                             |   | 282     |                           |   |   | 410 |   |   |   | 1,798 |   |   |   | 552 |   |   |   | 645 |   |
| Tenant Construction Management Fees – Hines                                                                 |   |                             | 23      |   |                             |   | 33      |                           |   |   | 25 |   |   |   | 167 |   |   |   | 5 |   |   |   | 184 |   |
| Re-development Construction Management Fees – Hines                                                         |   |                             | (4      | )      |                             |   | — |                           |   |   | 11 |   |   |   | — |   |   |   | (5 | ) |   |   | — |   |
| Expense Reimbursements – Hines (with respect to management and operation of the Company’s properties) |   |                             | 4,201   |   |                             |   | 4,289   |                           |   |   | 8,319 |   |   |   | 7,354 |   |   |   | 487 |   |   |   | 1,098 |   |

|                                                                          |   | June 30, 2009 |        |   | December 31, 2008 |   |
|-------------------------------------------------------------------------------|--------|---------------|-------------|--------|-------------------|--------|
| Organizational and offering costs related to the Second Offering              |   | $             | —     |   |              | $      |  9 |   |
| Dealer manager fees and selling commissions                                   |   |          | 133         |   |              |   |  42 |   |
| Asset management, acquisition fees and property-level fees and reimbursements |   |          |  4,718 |   |              |   |  8,649 |   |
| Other                                                                         |   |          | 847         |   |              |   | 815 |   |
| Total                                                                         |   | $             | 5,698       |   |              | $      | 9,515 |   |

----

|                                              |   | 2009   |         |   | 2008   |   |
|---------------------------------------------------|--------|--------|--------------|--------|--------|--------|
| Changes in assets and liabilities:                |   |   |         |   |   |   |
| Increase in other assets                          |   | $      | (1,789       | )      |   | $      | (117 | ) |
| Increase in tenant and other receivables          |   |   | (5,471       | )      |   |   | (10,733 | ) |
| Additions to deferred leasing costs               |   |   | (8,153       | )      |   |   | (11,340 | ) |
| Decrease in accounts payable and accrued expenses |   |   | (7,463       | )      |   |   | (330 | ) |
| Increase in participation interest liability      |   |   |  4,922  |   |   |   | 8,847 |   |
| (Decrease) increase in other liabilities          |   |   |  (3,837 | )      |   |   |  799 |   |
| Decrease in due to affiliates                     |   |   | (3,950       | )      |   |   | (1,134 | ) |
| Changes in assets and liabilities                 |   | $      | (25,741      | )      |   | $      | (14,008 | ) |

|                                                              |   | 2009   |        |   | 2008   |   |
|-------------------------------------------------------------------|--------|--------|-------------|--------|--------|--------|
| Supplemental Disclosure of Cash Flow Information                  |   |   |        |   |   |   |
| Cash paid for interest                                            |   | $      | 40,963      |   |   | $      | 36,191 |   |
| Cash paid for income taxes                                        |   | $      | 1,964       |   |   | $      | 444 |   |
| Supplemental Schedule of Non-Cash Activities                      |   |   |        |   |   |   |   |   |
| Unpaid selling commissions and dealer manager fees                |   | $      | 133         |   |   | $      | 2,703 |   |
| Deferred offering costs offset against additional paid-in-capital |   | $      | —     |   |   | $      | 4,200 |   |
| Distributions declared and unpaid                                 |   | $      | 33,570      |   |   | $      | 29,002 |   |
| Distributions receivable                                          |   | $      | 2,155       |   |   | $      | 6,887 |   |
| Distributions reinvested                                          |   | $      | 34,347      |   |   | $      | 27,899 |   |
| Shares tendered for redemption                                    |   | $      |  7,921 |   |   | $      | — |   |
| Stock subscription                                                |   | $      | 922         |   |   | $      | 10,153 |   |
| Non-cash net liabilities acquired upon acquisition of property    |   | $      | —     |   |   | $      | 20,772 |   |
| Accrual of deferred financing costs                               |   | $      | —     |   |   | $      | — |   |
| Assumption of mortgage upon acquisition of property               |   | $      | —     |   |   | $      | 52,938 |   |
| Accrued additions to deferred leasing costs                       |   | $      | 2,780       |   |   | $      | 3,150 |   |
| Accrued additions to investment property                          |   | $      | 230         |   |   | $      | 389 |   |

----

|                                                  |   | Three Months Ended June 30, |         |   | Six Months Ended June 30, |    |
|-------------------------------------------------------|--------|-----------------------------|--------------|--------|---------------------------|---------|
|                                                  |   | 2009                        |         |   | 2008                      |    |   | 2009 |   |   | 2008 |   |
|  Total revenue                                   |   |                        |         |   |                      |    |   |   |   |   |   |   |
|    Office properties                   |   | $                           | 85,325       |   |                      | $       | 84,730 |   |   | $ | 173,141 |   |   | $ | 154,864 |   |
|    Domestic industrial properties      |   |                        | 1,128        |   |                      |    | 490 |   |   |   | 2,244 |   |   |   | 490 |   |
|    International industrial properties |   |                        | 3,463        |   |                      |    | — |   |   |   | 6,552 |   |   |   | — |   |
|    Corporate-level accounts            |   |                        | —      |   |                      |    | — |   |   |   | — |   |   |   | — |   |
| Total revenue                                         |   | $                           | 89,916       |   |                      | $       | 85,220 |   |   | $ | 181,937 |   |   | $ | 155,354  |   |
|                                             |   |                        |         |   |                      |    |   |   |   |   |   |   |   |   |   |   |
| Net operating income (loss)                           |   |                        |         |   |                      |    |   |   |   |   |   |   |   |   |   |   |
|    Office properties(1)                     |   | $                      |  32,545 |   |                      | $  |  23,764 |   |   | $  |  73,914 |   |   | $  |  41,253 |   |
|    Domestic industrial properties(1)   |   |                        |  459    |   |                      |    |  386 |   |   |   |  894 |   |   |   |  182 |   |
|    International industrial properties(1)   |   |                        |  1,182  |   |                      |    | — |   |   |   |  2,278 |   |   |   | — |   |
|    Corporate-level accounts(2)              |   |                        |  10,128 |   |                      |    |  12,792 |   |   |   |  16,195 |   |   |   |  24,401 |   |
| Total segment net operating income (loss)             |   | $                      |  44,314 |   |                      | $  |  36,942 |   |   | $  |  93,281 |   |   | $  |  65,836 |   |

| (1)    | Revenues less property operating expenses, real property taxes and property management fees.                                       |
|--------|------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                               |
| (2)    | Revenues less asset management and acquisition fees, organizational and offering expenses and general and administrative expenses. |

|                                                                        |   | Three Months Ended June 30, |      |   | Six Months Ended June 30, |   |
|-----------------------------------------------------------------------------|--------|-----------------------------|-----------|--------|---------------------------|--------|
|                                                                        |   | 2009                        |      |   | 2008                      |   |   | 2009 |   |   | 2008 |   |
|   Equity in earnings (losses) of unconsolidated entities          |   |                        |      |   |                      |   |   |   |   |   |   |   |
|    Equity in losses of office properties                     |   | $                           | (3,083    | )      |                      | $      | (2,714 | ) |   | $ | (5,225 | ) |   | $ | (5,085 | ) |
|    Equity in earnings of domestic retail properties     |   |                        | 36        |   |                      |   | — |   |   |   | 31 |   |   |   | — |   |
|    Equity in earnings of international industrial properties |   |                        | 552  |   |                      |   | 533  |   |   |   | 997  |   |   |   | 969 |   |
|  Total equity in earnings (losses) of unconsolidated entities          |   |                        | (2,495    | )      |                      |   | (2,181 | ) |   |   | (4,197 | ) |   |   | (4,116 | ) |

| Total assets                                                      |   | June 30, 2009 |      |   | December 31, 2008 |   |
|-------------------------------------------------------------------|--------|---------------|-----------|--------|-------------------|--------|
|    Office properties                               |   | $             | 2,687,310 |   |              | $      | 2,732,893 |   |
|    Domestic industrial properties                  |   |          | 43,455    |   |              |   | 44,146 |   |
|    International industrial properties             |   |          | 138,406   |   |              |   | 119,368 |   |
|    Investment in unconsolidated entities –   |   |          |      |   |              |   |   |   |
|      Office properties                   |   |          | 283,555   |   |              |   | 290,062 |   |
|      Domestic retail properties          |   |          | 75,078    |   |              |   | 51,473 |   |
|      International industrial properties |   |          | 27,106    |   |              |   | 22,839 |   |
|    Corporate-level accounts                        |   |          | 59,344    |   |              |   | 19,656 |   |
| Total assets                                                      |   | $             | 3,314,254 |   |              | $      | 3,280,437 |   |

|                                                               |   | Three Months Ended June 30, |    |   | Six Months Ended June 30, |   |
|--------------------------------------------------------------------|--------|-----------------------------|---------|--------|---------------------------|--------|
|                                                               |   | 2009                        |    |   | 2008                      |   |   | 2009 |   |   | 2008 |   |
| Reconciliation to net income (loss)                                |   |                        |    |   |                      |   |   |   |   |   |   |   |
|    Total segment net operating income               |   | $                           | 44,314  |   |                      | $      | 36,942 |   |   | $ | 93,281 |   |   | $ | 65,836 |   |
|    Depreciation and amortization                    |   |                        | (31,010 | )      |                      |   | (32,216 | ) |   |   | (62,788 | ) |   |   | (57,597 | ) |
|    Equity in losses of unconsolidated entities, net |   |                        | (2,495  | )      |                      |   | (2,181 | ) |   |   | (4,197 | ) |   |   | (4,116 | ) |
|    Gain (loss) on derivative instruments, net       |   |                        | 35,895  |   |                      |   | 26,780 |   |   |   | 46,791 |   |   |   | (665 | ) |
|    Other losses                                     |   |                        | — |   |                      |   | — |   |   |   | (11 | ) |   |   | (2 | ) |
|    Interest expense                                 |   |                        | (23,005 | )      |                      |   | (20,900 | ) |   |   | (45,594 | ) |   |   | (38,952 | ) |
|    Interest income                                  |   |                        | 96      |   |                      |   | 361 |   |   |   | 375 |   |   |   | 1,610 |   |
|    Provision for income taxes                       |   |                        | (246    | )      |                      |   | 51 |   |   |   | (505 | ) |   |   | (464 | ) |
| Net income (loss)                                                  |   |                        | 23,549  |   |                      |   | 8,837 |   |   |   | 27,352 |   |   |   | (34,350 | ) |

----

|   | • | Whether we will have the opportunity to invest offering and dividend reinvestment plan proceeds to acquire properties or other investments or whether such proceeds will be needed to redeem shares; and if proceeds are available for investment, our ability to make such investments in a timely manner and at appropriate amountsthat provide acceptable returns; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | The potential need to fund tenant improvements, lease-up costs or other capital expenditures, as well as increases in property operating expenses and costs of compliance with environmental matters or discovery of previously undetected environmentally hazardous or other undetected adverse conditions at our properties; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |    |                                                                                                                                                                                                                                                                                                                           |
|   | • | Risks associated with debt;                                                                                                                                                                                                                                                                                                    |

|   | • | Competition for tenants and real estate investment opportunities, including competition with affiliates of Hines Interests Limited Partnership (“Hines”); |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | Risks associated with adverse changes in general economic or local market conditions, including terrorist attacks and other acts of violence, which may affect the markets in which we and our tenants operate; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | Catastrophic events, such as hurricanes, earthquakes and terrorist attacks; and our ability to secure adequate insurance at reasonable and appropriate rates; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |    |                                                                                                                                                          |
|   | • | Risks associated with the currency exchange rate related to our international investments;                                                                    |

|   | • | The failure of any bank in which we deposit our funds could reduce the amount of cash we have available to pay distributions and make additional investments; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | Changes in governmental, tax, real estate and zoning laws and regulations and the related costs of compliance and increases in our administrative operating expenses, including expenses associated with operating as a public company; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | Risks relating to our investment in Hines US Core Office Fund LP (the “Core Fund”), such as its reliance on Hines for its operations and investments, and our potential liability for Core Fund obligations; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | • | The lack of liquidity associated with our assets;                                                                                                                                                                                                                        |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |    |                                                                                                                                                                                                                                                                     |
|   | • | Our reliance on our Advisor, Hines and affiliates of Hines for our day-to-day operations and the selection of real estate investments, and our Advisor’s ability to attract and retain high-quality personnel who can provide service at a level acceptable to us; |
|   |    |                                                                                                                                                                                                                                                                     |
|   | • | Risks associated with conflicts of interests that result from our relationship with our Advisor and Hines, as well as conflicts of interests certain of our officers and directors face relating to the positions they hold with other entities; and                |
|   |    |                                                                                                                                                                                                                                                                     |
|   | • | Our ability to continue to qualify as a real estate investment trust (“REIT”) for federal income tax purposes.                                                                                                                                               |

----

----

|   | • | proceeds from our public offerings, including our dividend reinvestment plan; |
|--------|---------|-------------------------------------------------------------------------------|
|   |    |                                                                          |
|   | • | debt financings, including secured or unsecured facilities; and     |
|   |    |                                                                          |

|   | • | cash flow generated by our real estate investments and operations. |
|--------|---------|--------------------------------------------------------------------|

----

----

|                | Shareholders       |   | Noncontrolling Interests |
|---------------------|--------------------|--------|-------------------------------|
| Six Months Ended    | Cash Distributions |   |                          | Dividends Reinvested |   | Total Declared |   | Total Declared |
| Ended June 30, 2009 | $                  | 30,610 |                          |   | $ | 33,732 |   | $ | 64,342 |   | $  | 1,948 |
| Ended June 30, 2008 | $                  | 22,515 |                          |   | $ | 30,074 |   | $ | 52,589 |   | $  | 1,375 |

----

|   | RESULTS FOR OUR DIRECTLY-OWNED PROPERTIES |
|--------|-------------------------------------------|

|                                          | Three Months Ended June 30, |   | Change |   |
|-----------------------------------------------|-----------------------------|--------|--------|--------|
|                                          | 2009                        |   | 2008   |   | $ |   |   |   | % |   |
| Property revenues                             |                        |   |   |   |   |   |   |   |   |   |   |   |   |
| Same-store properties                         |                        | $      | 73,921 |   |   | $ | 77,409 |   |   | $ | (3,488 | ) |   |   | (4.5 | )% |
| Recent acquisitions                           |                        |   | 15,995 |   |   |   | 7,811 |   |   |   | 8,184 |   |   |   | 104.8 | % |
| Total property revenues                       |                        | $      | 89,916 |   |   | $ | 85,220 |   |   | $ | 4,696 |   |   |   | 5.5 | % |
|                                          |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Property expenses (1)                         |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Same-store properties                         |                        | $      | 53,470 |   |   | $ | 60,727 |   |   | $ | (7,257 | ) |   |   | (12.0 | )% |
| Recent acquisitions                           |                        |   | 13,260 |   |   |   | 6,924 |   |   |   | 6,336 |   |   |   | 91.5 | % |
|   Total property expenses                |                        | $      | 66,730 |   |   | $ | 67,651 |   |   | $ | (921 | ) |   |   | (1.4 | )% |
|                                          |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Property revenues in excess of expenses       |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Same-store properties                         |                        | $      | 20,451 |   |   | $ | 16,682 |   |   | $ | 3,769 |   |   |   | 22.6 | % |
| Recent acquisitions                           |                        |   | 2,735  |   |   |   | 887 |   |   |   | 1,848 |   |   |   | 208.3 | % |
| Total property revenues in excess of expenses |                        | $      | 23,186 |   |   | $ | 17,569 |   |   | $ | 5,617 |   |   |   | 32.0 | % |
|                                          |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Income/Expense                       |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Expense                              |                        | $      | 23,005 |   |   | $ | 20,900 |   |   | $ | 2,105 |   |   |   | 10.1 | % |
| Interest Income                               |                        | $      | 96     |   |   | $ | 361 |   |   | $ | (265 | ) |   |   | (73.4 | )% |

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|                           | Six Months Ended June 30, |   | Change  |   |
|--------------------------------|---------------------------|--------|---------|--------|
|                           | 2009                      |   | 2008    |   | $ |   |   |   | % |   |
| Property revenues              |                      |   |    |   |   |   |   |   |   |   |   |   |   |
| Same-store properties          |                      | $      | 133,820 |   |   | $ | 138,048 |   |   | $ | (4,228 | ) |   |   | (3.1 | )% |
| Recent acquisitions            |                      |   | 48,117  |   |   |   | 17,306 |   |   |   | 30,811 |   |   |   | 178.0 | % |
| Total property revenues        |                      | $      | 181,937 |   |   | $ | 155,354 |   |   | $ | 26,583 |   |   |   | 17.1 | % |
|                           |                      |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Property expenses (1)          |                      |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Same-store properties          |                      | $      | 100,808 |   |   | $ | 108,455 |   |   | $ | (7,647 | ) |   |   | (7.1 | )% |
| Recent acquisitions            |                      |   | 34,946  |   |   |   | 14,723 |   |   |   | 20,223 |   |   |   | 137.4 | % |
|   Total property expenses |                      | $      | 135,754 |   |   | $ | 123,178 |   |   | $ | 12,576 |   |   |   | 10.2 | % |

| Property revenues in excess of expenses       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|-----------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Same-store properties                         |   | $      | 33,012 |   |   | $      | 29,593 |   |   | $      | 3,419  |   |   |   | 11.6   | %      |
| Recent acquisitions                           |   |   | 13,171 |   |   |   | 2,583  |   |   |   | 10,588 |   |   |   | 409.9  | %      |
| Total property revenues in excess of expenses |   | $      | 46,183 |   |   | $      | 32,176 |   |   | $      | 14,007 |   |   |   | 43.5   | %      |
|                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Income/Expense                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Expense                              |   | $      | 45,594 |   |   | $      | 38,952 |   |   | $      | 6,642  |   |   |   | 17.1   | %      |
| Interest Income                               |   | $      | 375    |   |   | $      | 1,610  |   |   | $      | (1,235 | )      |   |   | (76.7  | )%     |

| (1)   | Property expenses include property operating expenses, real property taxes, property management fees, depreciation and amortization of real estate assets and income taxes. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | RESULTS FOR OUR INDIRECTLY-OWNED PROPERTIES |
|--------|---------------------------------------------|

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|                                  |   | Three Months Ended June 30, |   |   | Change |   |
|---------------------------------------|--------|-----------------------------|--------|--------|--------|--------|
|                                  |   | 2009                        |   |   | 2008   |   |   | $ |   |   | % |   |
|                                  |   |                        |   |   |   |   |   |   |   |   |   |   |
| Asset Management and Acquisition Fees |   | $                           | 8,498  |   |   | $      | 9,284 |   |   | $ | (786 | ) |   |   | (8.5 | )% |
| General and Administrative Expenses   |   | $                           | 1,630  |   |   | $      | 1,813 |   |   | $ | (183 | ) |   |   | (10.1 | )% |

|                                  |   | Six Months Ended June 30, |   |   | Change |   |
|---------------------------------------|--------|---------------------------|--------|--------|--------|--------|
|                                  |   | 2009                      |   |   | 2008   |   |   | $ |   |   | % |   |
|                                  |   |                      |   |   |   |   |   |   |   |   |   |   |
| Asset Management and Acquisition Fees |   | $                         | 13,112 |   |   | $      | 17,694 |   |   | $ | (4,582 | ) |   |   | (25.9) | % |
| General and Administrative Expenses   |   | $                         | 3,083  |   |   | $      | 3,093 |   |   | $ | (10 | ) |   |   | 0.0 | % |

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|                                                                                                                                   |   | Three Months EndedJune 30, 2009 |    |   | Three Months EndedJune 30, 2008 |   |    | Six Months EndedJune 30, 2009 |   |   | Six Months EndedJune 30, 2008 |   |
|----------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|--------|---------------------------------|--------|---------|-------------------------------|--------|--------|-------------------------------|--------|
| Net income (loss)                                                                                                                      |   | $                               | 23,549  |   |                            | $      | 8,837   |                          |   | $      | 27,352                        |   |   | $ | (34,350 | ) |
| Adjustments:                                                                                                                           |   |                            |    |   |                            |   |    |                          |   |   |                          |   |   |   |   |   |
|      Depreciation and amortization (1)                                                                        |   |                            | 31,010  |   |                            |   | 32,216  |                          |   |   | 62,788                        |   |   |   | 57,597 |   |
|      (Gain) loss on derivative instruments (2)                                                                |   |                            | (35,895 | )      |                            |   | (26,780 | )                             |   |   | (46,791                       | )      |   |   | 665 |   |
|      Participation interest expense (3)                                                                       |   |                            | 4,949   |   |                            |   | 4,642   |                          |   |   | 4,921                         |   |   |   | 8,847 |   |
|      Other components of revenues and expenses (4)                                                            |   |                            | (3,251  | )      |                            |   | (4,137  | )                             |   |   | (8,119                        | )      |   |   | (8,698 | ) |
|      Master lease rents (5)                                                                                   |   |                            | 479     |   |                            |   | 1,239   |                          |   |   | 1,200                         |   |   |   | 4,703 |   |
|      Organizational and offering expenses (6)                                                                 |   |                            | — |   |                            |   | 1,695   |                          |   |   | —                       |   |   |   | 3,614 |   |
|      Acquisition fees (6)                                                                                     |   |                            | — |   |                            |   | 1,572   |                          |   |   | 1,160                         |   |   |   | 3,018 |   |
|      Adjustments to equity in losses from unconsolidated      entities, net (7) |   |                            | 10,624  |   |                            |   | 10,502  |                          |   |   | 21,937                        |   |   |   | 20,282 |   |
|      Adjustments for noncontrolling interests (8)                                                             |   |                            | (930    | )      |                            |   | (754    | )                             |   |   | (1,884                        | )      |   |   | (1,387 | ) |
| Operating Funds Generated by the Company                                                                                               |   | $                               | 30,535  |   |                            | $      | 29,032  |                          |   | $      | 62,564                        |   |   | $  | 54,291 |   |
|                                                                                                                                   |   |                            |    |   |                            |   |    |                          |   |   |                          |   |   |   |   |   |
| Operating Funds Generated by the Company    Per Common Share                                                       |   | $                               | 0.15    |   |                            | $      | 0.16    |                          |   | $      | 0.31                          |   |   | $ | 0.32 |   |
| Weighted Average Shares Outstanding                                                                                                    |   |                            | 204,152 |   |                            |   | 178,536 |                          |   |   | 202,797                       |   |   |   | 171,840 |   |

----

| 1) |   | Represents the depreciation and amortization of various real estate assets.  Historical cost accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, we believethat such depreciation and amortization may be of limited relevance in evaluating current operating performance and, as such, these items are excluded from our determination of OFG. |
|----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2) |   | Represents components of net income (loss) related to the estimated changes in the values of our interest rate swap derivatives.  We have excluded these changes in value from our evaluation of the operating performance of the Company and OFG because we expect to hold the underlying instruments to their maturity and accordingly theinterim gains or losses will remain unrealized.                                                                                                                                         |
| 3) |   | Represents the portion of the acquisition and asset management fees that are paid in equity, which we expect will be settled in the future using proceeds from the sale of properties or other non-operating sources, and which we therefore do not consider in evaluating the operating performance of the Company and determining OFG.                                                                                                                                                                                                      |

| 4) |   | Includes the following components of revenues and expenses that we do not consider in evaluating the operating performance of the Company and determining OFG for the three and six months ended June 30, 2009 and 2008 (in thousands):  |
|----|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                         |   | Three Months EndedJune 30, 2009 |        |   | Three Months EndedJune 30, 2008 |   |      | Six Months EndedJune 30, 2009 |   |   | Six Months EndedJune 30, 2008 |   |
|----------------------------------------------|--------|---------------------------------|-------------|--------|---------------------------------|--------|-----------|-------------------------------|--------|--------|-------------------------------|--------|
| Straight-line rent adjustment (a)            |   | $                               | (1,839      | )      |                            | $      | (4,653    | )                             |   | $      | (5,252                        | )      |   | $ | (8,578 | ) |
| Amortization of lease incentives (b)         |   |                            |  1,265 |   |                            |   | 897  |                          |   |   | 2,535                    |   |   |   | 1,670  |   |
| Amortization of out-of-market leases (b)     |   |                            | (3,628      | )      |                            |   | (1,078    | )                             |   |   | (7,253                        | )      |   |   | (3,133 | ) |
| Amortization of deferred financing costs (b) |   |                            | 737         |   |                            |   | 412       |                          |   |   | 1,259                         |   |   |   | 791 |   |
| Other                                        |   |                            | 214         |   |                            |   | 285       |                          |   |   | 592                           |   |   |   | 552 |   |
|                                         |   | $                               | (3,251      | )      |                            | $      | (4,137    | )                             |   | $      | (8,119                        | )      |   | $ | (8,698 | ) |

|   |   | a | )  | Represents the adjustments to rental revenue as required by GAAP to recognize minimum lease payments on a straight-line basis over the respective lease terms.  We have excluded these adjustments from our evaluation of the operating performance of the Company and in determining OFG because we believe that the rent that is billableduring the current period is a more relevant measure of the Company’s operating performance for such period.                                                                                                         |
|--------|--------|---|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   | b | )  | Represents the amortization of lease incentives, out-of-market leases and deferred financing costs.  As stated in Note 1 above, historical cost accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values have historicallyrisen or fallen with market conditions, we believe that such amortization may be of limited relevance in evaluating current operating performance and, as such, these items are excluded from our determination of OFG. |

|   | 5 | )   | Includes master lease rents related to master leases entered into in conjunction with certain asset acquisitions. In accordance with GAAP, these rents are not included in rental revenue; however, we consider this rent in evaluating the operating performance of the Company and determining OFG.                                                                                         |
|--------|---|---------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | 6 | )   | Represents organizational and offering expenses and acquisition fees paid to our Advisor that are expensed in our condensed consolidated statements of operations. We fund such costs with proceeds from our offering and acquisition-related indebtedness, and therefore do not consider these expenses in evaluating the operating performance of theCompany and determining OFG. |
|   | 7 | )        | Includes adjustments to equity in losses of unconsolidated entities, net, similar to those described in Notes 1, 4 and 5 above for our unconsolidated entities, which are necessary to convert the Company's share of income (loss) from unconsolidated entities to OFG.                                                                                                                      |
|   | 8 | )             | Includes income attributable to noncontrolling interests and all adjustments to eliminate the noncontrolling interests’ share of the adjustments to convert the Company’s net income (loss) to OFG.                                                                                                                                                                               |

----

----

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|   | • | may not have sufficient available funds to make distributions and expects distributions, if any, for the next several quarters to be minimal; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | expects to acquire additional properties in the future which, if unsuccessful, could affect our ability to pay distributions to our shareholders; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | is subject to risks as a result of joint ownership of real estate with Hines and other Hines programs or third parties; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------|

|   | • | intends to use borrowings to partially fund acquisitions, which may result in foreclosures and unexpected debt-service requirements and indirectly negatively affect our ability to pay dividends to our shareholders; |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | • | is also dependent upon Hines and its key employees for its success; |
|--------|---------|---------------------------------------------------------------------|

|   | • | also operates in a competitive business with competitors who have significant financial resources and operational flexibility; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------|

|   | • | may not have funding or capital resources for future tenant improvements; |
|--------|---------|---------------------------------------------------------------------------|

|   | • | depends on its tenants for its revenue and relies on certain significant tenants; |
|--------|---------|-----------------------------------------------------------------------------------|

|   | • | is subject to risks associated with terrorism, uninsured losses and high insurance costs; |
|--------|---------|-------------------------------------------------------------------------------------------|

|   | • | will be affected by general economic and regulatory factors it cannot control or predict; |
|--------|---------|-------------------------------------------------------------------------------------------|

|   | • | will make illiquid investments and be subject to general economic and regulatory factors, including environmental laws, which it cannot control or predict; and |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | will be subject to property taxes and operating expenses that may increase. |
|--------|---------|-----------------------------------------------------------------------------|

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|       Period |   | TotalNumber of SharesPurchased |      |   | Average PricePaid per Share |   |       | Total Number ofShares Purchased asPart of PubliclyAnnounced Plans or Programs |   |   | Maximum Number of Shares that May Yet be Purchased Under the Plans or Programs(1) |   |
|--------------------------------------------|--------|-------------------------------------|-----------|--------|-----------------------------|--------|------------|-------------------------------------------------------------------------------|--------|--------|-----------------------------------------------------------------------------------|--------|
| April 1, 2009 to April 30, 2009            |   |                                | 2,341,644 |   |                        | $      |  9.15 |                                                                          |   |   | 2,341,644                                                                         |   |   |   |  8,513,743 |   |
| May 1, 2009 to May 31, 2009                |   |                                | 1,432,002 |   |                        |   |  9.15 |                                                                          |   |   | 1,432,002                                                                         |   |   |   | 7,611,098 |   |
| June 1, 2009 to June 30, 2009              |   |                                | 1,003,539 |   |                        |   | 9.15       |                                                                          |   |   | 1,003,539                                                                         |   |   |   | 7,531,708 |   |
|     Total                   |   |                                | 4,777,185 |   |                        | $      | 9.15       |                                                                          |   |   | 4,777,185                                                                         |   |   |   |   |   |

| (1) | We may redeem shares under the program so long as the total number of shares redeemed during the calendar year does not exceed, as of the date of the redemption, 10% of our shares outstanding on the same date during the prior year. For the three months ended June 30, 2009, all shareholder requests for redemptions were fully funded. Monthlyshare redemptions pursuant to our share redemption program are limited to 1/12th of 10% of our shares outstanding as of the prior calendar year-end. Our share redemption plan has been in effect since June 2004 and has no definitive expiration date. However, the plan may be suspended or terminated at the discretion of the board of directors. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

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| Exhibit No. |   |   |   |   | Description |
|-------------|--------|--------|--------|--------|-------------|
|        | 3.1    |   |   |   | —     |   | Second Amended and Restated Articles of Incorporation of Hines Real Estate Investment Trust, Inc. (filed as Exhibit 3.1 to the registrant’s Current Report on Form 8-K on July 13, 2007 and incorporated by reference herein). |
|        | 3.2    |   |   |   | —     |   | Second Amended and Restated Bylaws of Hines Real Estate Investment Trust, Inc. (filed as Exhibit 3.1 to the registrant’s Current Report on Form 8-K on August 3, 2006 and incorporated by reference herein). |
|        | 31.1   | *      |   |   | —     |   | Certification. |
|        | 31.2   | *      |   |   | —     |   | Certification. |
|        | 32.1   | *      |   |   | —     |   | Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C., Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Pursuant to SEC Release 34-47551 this Exhibit is furnished to the SEC and shall not be deemed to be “filed.” |

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

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