##### Table of Contents





UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549





FORM 10-Q





(Mark One)

|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the quarterly period ended 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
.

Commission File Number: 0-20625





DUKE REALTY LIMITED PARTNERSHIP

(Exact Name of Registrant as Specified in Its
Charter)







|                                                               |  |                                        
|-------------------------------------------------------------- |  | ---------------------------------------
|Indiana                                                        |  | 35-1898425                             
|(State or Other Jurisdiction of Incorporation or Organization) |  | (I.R.S. Employer Identification Number)
|                                                               | 
|600 East 96thStreet, Suite 100 Indianapolis, Indiana           |  | 46240                                  
|(Address of Principal Executive Offices)                       |  | (Zip Code)                             

Registrants Telephone Number, Including Area Code: (317) 808-6000





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

Indicate by check mark whether the registrant has
submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).    Yes   ̈    No   ̈

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



|                        |  |                                                  |  |                           |  |  
|----------------------- |  | ------------------------------------------------ |  | ------------------------- |  | -
|Large accelerated filer |  |  ̈                                                |  | Accelerated filer         |  |  ̈
|                        |  |                                                  | 
|Non-accelerated filer   |  | x  (Do not check if a smaller reporting company) |  | Smaller reporting company |  |  ̈

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act):    YES   ̈    NO  x

Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date:



|                                      |  |                              
|------------------------------------- |  | -----------------------------
|Class                                 |  | Outstanding at August 3, 2009
|Common Units, $.01 par value per unit |  | 230,606,926 units            









---

##### Table of Contents

DUKE REALTY LIMITED PARTNERSHIP

INDEX



|                                                                                              |  |                                                                                                             |  |       |  | 
|--------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------- |  | ----- |  | 
|                                                                                              |  | Page                                                                                                       
|Part I - Financial Information                                                                |  |                                                                                                            
|                                                                                              | 
|Item 1. Financial Statements                                                                  |  |                                                                                                            
|                                                                                              |  |                                                                                                            
|                                                                                              |  | Consolidated Balance Sheets as of June 30, 2009 (Unaudited) and December 31, 2008                           |  | 2    
|                                                                                              |  |                                                                                                            
|                                                                                              |  | Consolidated Statements of Operations (Unaudited) for the three and six months ended June 30, 2009 and 2008 |  | 3    
|                                                                                              |  |                                                                                                            
|                                                                                              |  | Consolidated Statements of Cash Flows (Unaudited) for the six months ended June 30, 2009 and
2008           |  | 4    
|                                                                                              |  |                                                                                                            
|                                                                                              |  | Consolidated Statement of Changes in Equity (Unaudited) for the six months ended June 30,
2009              |  | 5    
|                                                                                              |  |                                                                                                            
|                                                                                              |  | Notes to Consolidated Financial Statements (Unaudited)                                                      |  | 6-17 
|                                                                                              | 
|Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations |  | 17-34                                                                                                      
|                                                                                              | 
|Item 3. Quantitative and Qualitative Disclosures About Market Risk                            |  | 35                                                                                                         
|                                                                                              | 
|Item 4. Controls and Procedures                                                               |  | 36                                                                                                         
|                                                                                              | 
|Part II - Other Information                                                                   |  |                                                                                                            
|                                                                                              |  |                                                                                                            
|Item 1.                                                                                       |  | Legal Proceedings                                                                                           |  | 36   
|                                                                                              |  |                                                                                                            
|Item 1A.                                                                                      |  | Risk Factors                                                                                                |  | 36   
|                                                                                              |  |                                                                                                            
|Item 2.                                                                                       |  | Unregistered Sales of Equity Securities and Use of Proceeds                                                 |  | 36-37
|                                                                                              |  |                                                                                                            
|Item 3.                                                                                       |  | Defaults Upon Senior Securities                                                                             |  | 37   
|                                                                                              |  |                                                                                                            
|Item 4.                                                                                       |  | Submission of Matters to a Vote of Security Holders                                                         |  | 37-38
|                                                                                              |  |                                                                                                            
|Item 5.                                                                                       |  | Other Information                                                                                           |  | 38   
|                                                                                              |  |                                                                                                            
|Item 6.                                                                                       |  | Exhibits                                                                                                    |  | 39   



---

##### Table of Contents

PART IFINANCIAL INFORMATION

Item 1. Financial Statements

DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

Consolidated Balance
Sheets

(in thousands)



|                                                                                               |  |              |            |   |                  |   |            |  
|---------------------------------------------------------------------------------------------- |  | ------------ | ---------- | - | ---------------- | - | ---------- | -
|                                                                                               |  | June 30,2009 |            |   | December 31,2008 |  
|                                                                                               |  | (Unaudited)  |            |   |                  |  
|ASSETS                                                                                         |  |              |            |   |                  |   |            |  
|Real estate investments:                                                                       |  |              |            |   |                  |   |            |  
|Land and improvements                                                                          |  | $            | 1,124,284  |   |                  | $ | 1,077,362  |  
|Buildings and tenant improvements                                                              |  |              | 5,342,511  |   |                  |   | 5,220,561  |  
|Construction in progress                                                                       |  |              | 168,103    |   |                  |   | 159,330    |  
|Investments in and advances to unconsolidated companies                                        |  |              | 486,937    |   |                  |   | 693,503    |  
|Undeveloped land                                                                               |  |              | 812,003    |   |                  |   | 806,379    |  
|                                                                                               |  |              |            |   |                  |   |            |  
|                                                                                               |  |              | 7,933,838  |   |                  |   | 7,957,135  |  
|Accumulated depreciation                                                                       |  |              | (1,252,221 | ) |                  |   | (1,167,113 | )
|                                                                                               |  |              |            |   |                  |   |            |  
|Net real estate investments                                                                    |  |              | 6,681,617  |   |                  |   | 6,790,022  |  
|                                                                                               |  |             
|Cash and cash equivalents                                                                      |  |              | 26,698     |   |                  |   | 22,285     |  
|Accounts receivable, net of allowance of $5,172 and $1,777                                     |  |              | 22,157     |   |                  |   | 28,026     |  
|Straight-line rent receivable, net of allowance of $4,500 and $4,086                           |  |              | 128,172    |   |                  |   | 123,863    |  
|Receivables on construction contracts, including retentions                                    |  |              | 68,124     |   |                  |   | 75,100     |  
|Deferred financing costs, net of accumulated amortization of $41,825 and $38,046               |  |              | 44,481     |   |                  |   | 47,904     |  
|Deferred leasing and other costs, net of accumulated amortization of $218,144 and $195,034     |  |              | 387,915    |   |                  |   | 369,224    |  
|Escrow deposits and other assets                                                               |  |              | 236,228    |   |                  |   | 234,018    |  
|                                                                                               |  |              |            |   |                  |   |            |  
|                                                                                               |  | $            | 7,595,392  |   |                  | $ | 7,690,442  |  
|                                                                                               |  |              |            |   |                  |   |            |  
|LIABILITIES AND EQUITY                                                                         |  |              |            |   |                  |   |            |  
|Indebtedness:                                                                                  |  |              |            |   |                  |   |            |  
|Secured debt                                                                                   |  | $            | 666,405    |   |                  | $ | 507,351    |  
|Unsecured notes                                                                                |  |              | 2,978,568  |   |                  |   | 3,285,980  |  
|Unsecured lines of credit                                                                      |  |              | 92,923     |   |                  |   | 483,659    |  
|                                                                                               |  |              |            |   |                  |   |            |  
|                                                                                               |  |              | 3,737,896  |   |                  |   | 4,276,990  |  
|                                                                                               |  |             
|Construction payables and amounts due subcontractors, including retentions                     |  |              | 96,632     |   |                  |   | 105,227    |  
|Accrued real estate taxes                                                                      |  |              | 91,577     |   |                  |   | 78,483     |  
|Accrued interest                                                                               |  |              | 51,981     |   |                  |   | 56,376     |  
|Other accrued expenses                                                                         |  |              | 27,485     |   |                  |   | 44,835     |  
|Other liabilities                                                                              |  |              | 180,805    |   |                  |   | 187,425    |  
|Tenant security deposits and prepaid rents                                                     |  |              | 32,285     |   |                  |   | 41,348     |  
|                                                                                               |  |              |            |   |                  |   |            |  
|Total liabilities                                                                              |  |              | 4,218,661  |   |                  |   | 4,790,684  |  
|                                                                                               |  |              |            |   |                  |   |            |  
|Partners equity:                                                                              |  |              |            |   |                  |   |            |  
|General Partner                                                                                |  |              |            |   |                  |   |            |  
|Common equity (223,838 and 148,420 General Partner Units issued and outstanding)               |  |              | 2,315,617  |   |                  |   | 1,840,002  |  
|Preferred equity (4,067 Preferred Units issued and outstanding)                                |  |              | 1,016,625  |   |                  |   | 1,016,625  |  
|                                                                                               |  |              |            |   |                  |   |            |  
|                                                                                               |  |              | 3,332,242  |   |                  |   | 2,856,627  |  
|Limited Partners common equity (6,714 and 6,779 Limited Partner Units issued and outstanding) |  |              | 44,334     |   |                  |   | 47,835     |  
|Accumulated other comprehensive income (loss)                                                  |  |              | (7,149     | ) |                  |   | (8,652     | )
|                                                                                               |  |              |            |   |                  |   |            |  
|Total partners equity                                                                         |  |              | 3,369,427  |   |                  |   | 2,895,810  |  
|Noncontrolling interests                                                                       |  |              | 7,304      |   |                  |   | 3,948      |  
|                                                                                               |  |              |            |   |                  |   |            |  
|Total equity                                                                                   |  |              | 3,376,731  |   |                  |   | 2,899,758  |  
|                                                                                               |  |              |            |   |                  |   |            |  
|                                                                                               |  | $            | 7,595,392  |   |                  | $ | 7,690,442  |  
|                                                                                               |  |              |            |   |                  |   |            |  

See accompanying Notes to Consolidated Financial Statements



- 2 -



---

##### Table of Contents

DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

Consolidated Statements of Operations

For the Three and Six Months Ended June 30,

(in thousands, except per unit amounts)

(Unaudited)



|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|------------------------------------------------------------------------- |  | ------------------ | ------- | - | ---------------- | - | ------- | ---- |  | - | --------- | - |  | - | ------- | -
|                                                                          |  | Three Months Ended |         |   | Six Months Ended |  
|                                                                          |  | 2009               |         |   | 2008             |   |         | 2009 |  |   | 2008      |  
|                                                                          |  |                    |         |   | (Revised)        |   |         |      |  |   | (Revised) |  
|Revenues:                                                                 |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Rental and related revenue                                                |  | $                  | 224,987 |   |                  | $ | 211,613 |      |  | $ | 445,700   |   |  | $ | 423,248 |  
|General contractor revenue                                                |  |                    | 119,705 |   |                  |   | 85,635  |      |  |   | 218,062   |   |  |   | 162,394 |  
|Service fee revenue                                                       |  |                    | 7,537   |   |                  |   | 8,613   |      |  |   | 14,274    |   |  |   | 16,137  |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|                                                                          |  |                    | 352,229 |   |                  |   | 305,861 |      |  |   | 678,036   |   |  |   | 601,779 |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Expenses:                                                                 |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Rental expenses                                                           |  |                    | 49,016  |   |                  |   | 44,917  |      |  |   | 103,160   |   |  |   | 95,153  |  
|Real estate taxes                                                         |  |                    | 29,946  |   |                  |   | 25,806  |      |  |   | 59,085    |   |  |   | 51,262  |  
|General contractor costs                                                  |  |                    | 111,212 |   |                  |   | 81,248  |      |  |   | 202,615   |   |  |   | 154,421 |  
|Service Operations general expenses                                       |  |                    | 7,063   |   |                  |   | 7,368   |      |  |   | 12,406    |   |  |   | 14,437  |  
|Depreciation and amortization                                             |  |                    | 86,745  |   |                  |   | 75,525  |      |  |   | 166,678   |   |  |   | 151,129 |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|                                                                          |  |                    | 283,982 |   |                  |   | 234,864 |      |  |   | 543,944   |   |  |   | 466,402 |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Other operating activities:                                               |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Equity in earnings of unconsolidated companies                            |  |                    | 2,462   |   |                  |   | 6,881   |      |  |   | 4,989     |   |  |   | 16,980  |  
|Gain on disposition of Build-for-Sale properties, net of tax              |  |                    |        |   |                  |   | 4,758   |      |  |   |          |   |  |   | 5,130   |  
|Earnings from sales of land, net                                          |  |                    |        |   |                  |   | 3,393   |      |  |   | 357       |   |  |   | 4,022   |  
|Undeveloped land carrying costs                                           |  |                    | (2,680  | ) |                  |   | (1,911  | )    |  |   | (5,045    | ) |  |   | (4,060  | )
|Impairment charges                                                        |  |                    | (17,131 | ) |                  |   | (1,991  | )    |  |   | (17,469   | ) |  |   | (2,799  | )
|General and administrative expense                                        |  |                    | (13,600 | ) |                  |   | (6,889  | )    |  |   | (23,480   | ) |  |   | (19,052 | )
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|                                                                          |  |                    | (30,949 | ) |                  |   | 4,241   |      |  |   | (40,648   | ) |  |   | 221     |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Operating income                                                          |  |                    | 37,298  |   |                  |   | 75,238  |      |  |   | 93,444    |   |  |   | 135,598 |  
|Other income (expenses):                                                  |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Interest and other income (expense), net                                  |  |                    | 5       |   |                  |   | (541    | )    |  |   | 128       |   |  |   | 1,018   |  
|Interest expense                                                          |  |                    | (52,025 | ) |                  |   | (47,841 | )    |  |   | (104,073  | ) |  |   | (95,944 | )
|Gain on extinguishment of debt                                            |  |                    | 1,449   |   |                  |   |        |      |  |   | 34,511    |   |  |   |        |  
|Loss on business combinations                                             |  |                    | (999    | ) |                  |   |        |      |  |   | (999      | ) |  |   |        |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Income (loss) from continuing operations                                  |  |                    | (14,272 | ) |                  |   | 26,856  |      |  |   | 23,011    |   |  |   | 40,672  |  
|Discontinued operations:                                                  |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Income (loss) before impairment charges and gain on sales                 |  |                    | (103    | ) |                  |   | (159    | )    |  |   | 82        |   |  |   | 2,640   |  
|Impairment charges                                                        |  |                    | (772    | ) |                  |   |        |      |  |   | (772      | ) |  |   |        |  
|Gain on sale of depreciable properties                                    |  |                    | 49      |   |                  |   | 9,531   |      |  |   | 5,168     |   |  |   | 10,641  |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Income (loss) from discontinued operations                                |  |                    | (826    | ) |                  |   | 9,372   |      |  |   | 4,478     |   |  |   | 13,281  |  
|Net income (loss)                                                         |  |                    | (15,098 | ) |                  |   | 36,228  |      |  |   | 27,489    |   |  |   | 53,953  |  
|Distributions on Preferred Units                                          |  |                    | (18,363 | ) |                  |   | (18,866 | )    |  |   | (36,726   | ) |  |   | (34,172 | )
|Net (income) loss attributable to noncontrolling interests                |  |                    | 4       |   |                  |   | (1      | )    |  |   | 87        |   |  |   | 292     |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Net income (loss) attributable to common unitholders                      |  | $                  | (33,457 | ) |                  | $ | 17,361  |      |  | $ | (9,150    | ) |  | $ | 20,073  |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Basic net income (loss) per Common Unit:                                  |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Continuing operations attributable to common unitholders                  |  | $                  | (.15    | ) |                  | $ | .05     |      |  | $ | (.08      | ) |  | $ | .04     |  
|Discontinued operations attributable to common unitholders                |  |                    | (.01    | ) |                  |   | .06     |      |  |   | .03       |   |  |   | .08     |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Total                                                                     |  | $                  | (.16    | ) |                  | $ | .11     |      |  | $ | (.05      | ) |  | $ | .12     |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Diluted net income (loss) per Common Unit:                                |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Continuing operations attributable to common unitholders                  |  | $                  | (.15    | ) |                  | $ | .05     |      |  | $ | (.08      | ) |  | $ | .04     |  
|Discontinued operations attributable to common unitholders                |  |                    | (.01    | ) |                  |   | .06     |      |  |   | .03       |   |  |   | .08     |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Total                                                                     |  | $                  | (.16    | ) |                  | $ | .11     |      |  | $ | (.05      | ) |  | $ | .12     |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Weighted average number of Common Units outstanding                       |  |                    | 214,015 |   |                  |   | 154,425 |      |  |   | 184,797   |   |  |   | 154,307 |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  
|Weighted average number of Common Units and potential dilutive securities |  |                    | 214,015 |   |                  |   | 154,624 |      |  |   | 184,797   |   |  |   | 154,477 |  
|                                                                          |  |                    |         |   |                  |   |         |      |  |   |           |   |  |   |         |  

See accompanying Notes to Consolidated Financial Statements



- 3 -



---

##### Table of Contents

DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the six months ended June 30,

(in thousands)

(Unaudited)



|                                                                                               |  |      |          |   |           |   |          |  
|---------------------------------------------------------------------------------------------- |  | ---- | -------- | - | --------- | - | -------- | -
|                                                                                               |  | 2009 |          |   | 2008      |  
|                                                                                               |  |      |          |   | (Revised) |  
|Cash flows from operating activities:                                                          |  |      |          |   |           |   |          |  
|Net income                                                                                     |  | $    | 27,489   |   |           | $ | 53,953   |  
|Adjustments to reconcile net income to net cash provided by operating activities:              |  |      |          |   |           |   |          |  
|Depreciation of buildings and tenant improvements                                              |  |      | 131,678  |   |           |   | 120,484  |  
|Amortization of deferred leasing and other costs                                               |  |      | 35,348   |   |           |   | 35,212   |  
|Amortization of deferred financing costs                                                       |  |      | 6,746    |   |           |   | 6,656    |  
|Straight-line rent adjustment                                                                  |  |      | (10,092  | ) |           |   | (9,943   | )
|Impairment charges                                                                             |  |      | 18,121   |   |           |   |         |  
|Gain on debt extinguishment                                                                    |  |      | (34,511  | ) |           |   |         |  
|Loss on business combination                                                                   |  |      | 999      |   |           |   |         |  
|Earnings from land and depreciated property sales                                              |  |      | (5,525   | ) |           |   | (14,663  | )
|Build-for-Sale operations, net                                                                 |  |      | 14,793   |   |           |   | (64,312  | )
|Construction contracts, net                                                                    |  |      | (10,573  | ) |           |   | (16,320  | )
|Other accrued revenues and expenses, net                                                       |  |      | 6,109    |   |           |   | 6,263    |  
|Operating distributions received in excess of equity in earnings from unconsolidated companies |  |      | 7,632    |   |           |   | 1,943    |  
|                                                                                               |  |      |          |   |           |   |          |  
|Net cash provided by operating activities                                                      |  |      | 188,214  |   |           |   | 119,273  |  
|                                                                                               |  |      |          |   |           |   |          |  
|Cash flows from investing activities:                                                          |  |      |          |   |           |   |          |  
|Development of real estate investments                                                         |  |      | (149,218 | ) |           |   | (268,204 | )
|Acquisition of real estate investments and related intangible assets                           |  |      | (16,591  | ) |           |   | (11,317  | )
|Acquisition of undeveloped land                                                                |  |      | (5,474   | ) |           |   | (18,030  | )
|Recurring tenant improvements, leasing costs and building improvements                         |  |      | (36,709  | ) |           |   | (32,004  | )
|Other deferred leasing costs                                                                   |  |      | (7,966   | ) |           |   | (14,713  | )
|Other deferred costs and other assets                                                          |  |      | 7,245    |   |           |   | (5,145   | )
|Proceeds from land and depreciated property sales, net                                         |  |      | 100,226  |   |           |   | 69,272   |  
|Capital distributions from unconsolidated companies                                            |  |      |         |   |           |   | 45,680   |  
|Capital contributions and advances to unconsolidated companies, net                            |  |      | (6,311   | ) |           |   | (21,242  | )
|                                                                                               |  |      |          |   |           |   |          |  
|Net cash used for investing activities                                                         |  |      | (114,798 | ) |           |   | (255,703 | )
|                                                                                               |  |      |          |   |           |   |          |  
|Cash flows from financing activities:                                                          |  |      |          |   |           |   |          |  
|Contributions from the General Partner                                                         |  |      | 551,631  |   |           |   | 8,930    |  
|Proceeds from issuance of Preferred Units, net                                                 |  |      |         |   |           |   | 290,000  |  
|Proceeds from unsecured debt issuance                                                          |  |      |         |   |           |   | 325,000  |  
|Payments on and repurchases of unsecured debt                                                  |  |      | (274,015 | ) |           |   | (225,000 | )
|Proceeds from secured debt financings                                                          |  |      | 164,952  |   |           |   |         |  
|Payments on secured indebtedness including principal amortization                              |  |      | (5,608   | ) |           |   | (39,955  | )
|Payments on lines of credit, net                                                               |  |      | (390,736 | ) |           |   | (52,276  | )
|Distributions to common unitholders                                                            |  |      | (77,911  | ) |           |   | (148,140 | )
|Distributions to preferred unitholders                                                         |  |      | (36,726  | ) |           |   | (34,172  | )
|Contributions from noncontrolling interests, net                                               |  |      | 3,443    |   |           |   | 731      |  
|Cash settlement of interest rate swaps                                                         |  |      |         |   |           |   | (14,625  | )
|Deferred financing costs                                                                       |  |      | (4,033   | ) |           |   | (3,256   | )
|                                                                                               |  |      |          |   |           |   |          |  
|Net cash provided by (used for) financing activities                                           |  |      | (69,003  | ) |           |   | 107,237  |  
|                                                                                               |  |      |          |   |           |   |          |  
|Net increase (decrease) in cash and cash equivalents                                           |  |      | 4,413    |   |           |   | (29,193  | )
|Cash and cash equivalents at beginning of period                                               |  |      | 22,285   |   |           |   | 47,046   |  
|                                                                                               |  |      |          |   |           |   |          |  
|Cash and cash equivalents at end of period                                                     |  | $    | 26,698   |   |           | $ | 17,853   |  
|                                                                                               |  |      |          |   |           |   |          |  
|Non-cash investing and financing activities:                                                   |  |      |          |   |           |   |          |  
|Conversion of Limited Partner Units to common shares of the General Partner                    |  | $    | 453      |   |           | $ | 2,291    |  
|                                                                                               |  |      |          |   |           |   |          |  
|Assumption of secured debt for real estate acquisitions                                        |  | $    |         |   |           | $ | 23,094   |  
|                                                                                               |  |      |          |   |           |   |          |  
|Contribution of property to, net of debt assumed by, unconsolidated companies                  |  | $    | 8,054    |   |           | $ | 85,893   |  
|                                                                                               |  |      |          |   |           |   |          |  
|Consolidation of previously unconsolidated companies                                           |  | $    | 206,852  |   |           | $ |         |  
|                                                                                               |  |      |          |   |           |   |          |  

See accompanying Notes to Consolidated Financial Statements



- 4 -



---

##### Table of Contents

DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

Consolidated Statement of Changes in Equity

For the six months ended June 30, 2009

(in thousands, except per unit data)

(Unaudited)



|                                                 |                 |                    |           |                              |                          |   |                                     |              |  |                      |        |   |  |   |        |   |  |   |           |   |  |   |       |   |  |   |           |  
|------------------------------------------------ | --------------- | ------------------ | --------- | ---------------------------- | ------------------------ | - | ----------------------------------- | ------------ |  | -------------------- | ------ | - |  | - | ------ | - |  | - | --------- | - |  | - | ----- | - |  | - | --------- | -
|                                                 |                 | Common Unitholders |           |                              | Non-ControllingInterests |   |                                     | Total Equity | 
|                                                 | General Partner |                    |           | LimitedPartnersCommonEquity |                          |   | AccumulatedOtherComprehensiveIncome |              |  | TotalPartnersEquity |        |   | 
|                                                 | CommonEquity    |                    |           | PreferredEquity              |                          |   |                                     |              |  |                     
|Balance at December 31, 2008                     |                 | $                  | 1,840,002 |                              |                          | $ | 1,016,625                           |              |  | $                    | 47,835 |   |  | $ | (8,652 | ) |  | $ | 2,895,810 |   |  | $ | 3,948 |   |  | $ | 2,899,758 |  
|Comprehensive income:                            |                 |                    |           |                              |                          |   |                                     |              |  |                      |        |   |  |   |        |   |  |   |           |   |  |   |       |   |  |   |           |  
|Net income (loss)                                |                 |                    | (8,816    | )                            |                          |   | 36,726                              |              |  |                      | (334   | ) |  |   |       |   |  |   | 27,576    |   |  |   | (87   | ) |  |   | 27,489    |  
|Derivative instrument activity                   |                 |                    |          |                              |                          |   |                                    |              |  |                      |       |   |  |   | 1,503  |   |  |   | 1,503     |   |  |   |      |   |  |   | 1,503     |  
|                                                 |                 |                    |           |                              |                          |   |                                     |              |  |                      |        |   |  |   |        |   |  |   |           |   |  |   |       |   |  |   |           |  
|Comprehensive income                             |                 |                    |           |                              |                          |   |                                     |              |  |                      |        |   |  |   |        |   |  | $ | 29,079    |   |  | $ | (87   | ) |  | $ | 28,992    |  
|Conversion of Limited Partner                    |                 |                    |           |                              |                          |   |                                     |              |  |                      |        |   |  |   |        |   |  |   |           |   |  |   |       |   |  |   |           |  
|Units to common shares of the General Partner    |                 |                    | 453       |                              |                          |   |                                    |              |  |                      | (453   | ) |  |   |       |   |  |   |          |   |  |   |      |   |  |   |          |  
|Capital Contribution from General Partner        |                 |                    | 551,862   |                              |                          |   |                                    |              |  |                      |       |   |  |   |       |   |  |   | 551,862   |   |  |   |      |   |  |   | 551,862   |  
|Stock based compensation plan activity           |                 |                    | 7,313     |                              |                          |   |                                    |              |  |                      |       |   |  |   |       |   |  |   | 7,313     |   |  |   |      |   |  |   | 7,313     |  
|Distributions to Preferred Unitholders           |                 |                    |          |                              |                          |   | (36,726                             | )            |  |                      |       |   |  |   |       |   |  |   | (36,726   | ) |  |   |      |   |  |   | (36,726   | )
|Distributions to Partners ($.42 per Common Unit) |                 |                    | (75,197   | )                            |                          |   |                                    |              |  |                      | (2,714 | ) |  |   |       |   |  |   | (77,911   | ) |  |   |      |   |  |   | (77,911   | )
|Contributions from noncontrolling interests, net |                 |                    |          |                              |                          |   |                                    |              |  |                      |       |   |  |   |       |   |  |   |          |   |  |   | 3,443 |   |  |   | 3,443     |  
|                                                 |                 |                    |           |                              |                          |   |                                     |              |  |                      |        |   |  |   |        |   |  |   |           |   |  |   |       |   |  |   |           |  
|Balance at June 30, 2009                         |                 | $                  | 2,315,617 |                              |                          | $ | 1,016,625                           |              |  | $                    | 44,334 |   |  | $ | (7,149 | ) |  | $ | 3,369,427 |   |  | $ | 7,304 |   |  | $ | 3,376,731 |  
|                                                 |                 |                    |           |                              |                          |   |                                     |              |  |                      |        |   |  |   |        |   |  |   |           |   |  |   |       |   |  |   |           |  
|Common Units outstanding at June 30, 2009        |                 |                    | 223,838   |                              |                          |   |                                     |              |  |                      | 6,714  |   |  |   |        |   |  |   | 230,552   |   |  |   |       |   |  |   |           |  
|                                                 |                 |                    |           |                              |                          |   |                                     |              |  |                      |        |   |  |   |        |   |  |   |           |   |  |   |       |   |  |   |           |  

See accompanying Notes to Consolidated Financial Statements



- 5 -



---

##### Table of Contents

DUKE REALTY LIMITED PARTNERSHIP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)



|1. | General Basis of Presentation
|-- | -----------------------------

The interim
consolidated financial statements included herein have been prepared by Duke Realty Limited Partnership (the Partnership) without audit. The 2008 year-end consolidated balance sheet data included in this Quarterly Report on Form 10-Q
(this Report) was derived from our audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (GAAP). Our audited financial
statements, as adjusted for the retrospective application of new accounting standards, are included as Exhibit 99.2 to a Current Report on Form 8-K filed on July 22, 2009. The financial statements have been prepared in accordance with GAAP for
interim financial information and in accordance with Rule 10-01 of Regulation S-X of the Securities Exchange Act of 1934, as amended. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial
statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. GAAP requires us to make estimates and assumptions that affect the reported
amounts of assets and liabilities and revenue and expenses during the reporting period. Our actual results could differ from those estimates and assumptions. These financial statements should be read in conjunction with Managements Discussion
and Analysis of Financial Condition and Results of Operations included herein and the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2008 or on the Current Report
on Form 8-K.

The Partnership was formed on October 4, 1993, when Duke Realty Corporation (the General Partner) contributed
all of its properties and related assets and liabilities, together with the net proceeds from an offering of additional shares of its common stock, to the Partnership. Simultaneously, the Partnership completed the acquisition of Duke Associates, a
full-service commercial real estate firm operating in the Midwest. The General Partner was formed in 1985 and we believe it qualifies as a real estate investment trust (REIT) under the provisions of the Internal Revenue Code of 1986, as
amended. The General Partner is the sole general partner of the Partnership, owning 97.1% of the common Partnership interest as of June 30, 2009 (General Partner Units). The remaining 2.9% of the Partnerships common interest
is owned by limited partners (Limited Partner Units and, together with the General Partner Units, the Common Units). Limited Partners have the right to redeem their Limited Partner Units, subject to certain restrictions.
Pursuant to the Partnership Agreement, the General Partner is obligated to redeem the Limited Partner Units in shares of its common stock, unless it determines, in its reasonable discretion that the issuance of shares of its common stock could cause
it to fail to qualify as a REIT. Each Limited Partner Unit shall be redeemed for one share of the General Partners common stock, or, in the event that the issuance of shares could cause the General Partner to fail to qualify as a REIT, cash
equal to the fair market value of one share of the General Partners common stock at the time of redemption, in each case, subject to certain adjustments described in the Partnership Agreement. The General Partner also owns preferred
partnership interests in the Partnership (Preferred Units).

We own and operate a portfolio primarily consisting of industrial
and office properties and provide real estate services to third-party owners. We conduct our Service Operations (see Note 9) through Duke Realty Services LLC, Duke Realty Services Limited Partnership and Duke Construction Limited Partnership. The
consolidated financial statements include our accounts and the accounts of our majority-owned or controlled subsidiaries. In this Report, unless the context indicates otherwise, the terms we, us and our refer to
the Partnership and those entities owned or controlled by the Partnership.



- 6 -



---

##### Table of Contents

|2. | New Accounting Pronouncements
|-- | -----------------------------

Statement of
Financial Accounting Standard No. 157 and related literature

Based on the guidance provided by Financial Accounting Standards
Board (FASB) Staff Position (FSP) No. 157-2, Effective Date of FASB Statement No. 157(FSP No. 157-2), we only implemented the guidance promulgated under Statement of Financial Accounting
Standard (SFAS) No. 157, Fair Value Measurements (SFAS 157), as of January 1, 2008, for financial instruments. SFAS 157 was adopted on January 1, 2009 for nonfinancial long-lived asset groups that may be
measured at fair value for an impairment assessment, reporting units measured at fair value in the first step of the goodwill impairment test, and nonfinancial assets and nonfinancial liabilities initially measured at fair value in a business
combination. FSP FAS 157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly, which was effective for us on April 1,
2009, provides additional criteria to enable a determination to be made as to whether or not a market is active. If markets are determined to be inactive, then an analysis is required as to whether an individual market transaction is not indicative
of fair value, potentially requiring fair value to be estimated utilizing inputs other than market transactions.

FASB Staff Position
No. 14-1

On January 1, 2009, we adopted FSP APB No. 14-1, Accounting for Convertible Debt Instruments that may be
Settled in Cash upon Conversion (Including Partial Cash Settlement) (FSP APB 14-1). FSP APB 14-1 requires separate accounting for the debt and equity components of certain convertible instruments. Our 3.75% Exchangeable Senior Notes
(Exchangeable Notes), issued in November 2006, have an exchange rate of 20.47 common shares per $1,000 principal amount of the notes, representing an exchange price of $48.85 per share of the General Partners common stock. The
Exchangeable Notes are subject to the accounting changes required by FSP APB 14-1. FSP APB 14-1 requires that the value assigned to the debt component equal the estimated fair value of debt with similar contractual cash flows, but without the
conversion feature, which results in the debt being recorded at a discount. The resulting debt discount will be amortized over the period from its issuance through November 2011, the first optional redemption date, as additional non-cash interest
expense. FSP APB 14-1 requires the new accounting treatment to be retroactively applied to prior periods.



- 7 -



---

##### Table of Contents

At June 30, 2009, the Exchangeable Notes had $442.2 million of principal outstanding, an unamortized
discount of $13.9 million and a net carrying amount of $428.2 million. The carrying amount of the equity component was $34.7 million at June 30, 2009. Subsequent to the implementation of FSP APB 14-1, interest expense is recognized on the
Exchangeable Notes at an effective rate of 5.6%. The increase to interest expense (in thousands) on the Exchangeable Notes, which led to a corresponding decrease to net income, for the three and six months ended June 30, 2009 and 2008 is
summarized as follows:



|                                                                         |  |                            |       |                          |   |       |  |      |        |  |   |       
|------------------------------------------------------------------------ |  | -------------------------- | ----- | ------------------------ | - | ----- |  | ---- | ------ |  | - | ------
|                                                                         |  | Three Months EndedJune 30, |       | Six Months EndedJune 30,
|                                                                         |  | 2009                       |       | 2008                     |   | 2009  |  | 2008
|Interest expense on Exchangeable Notes, excluding effect of FSP APB 14-1 |  | $                          | 4,225 |                          | $ | 5,391 |  | $    | 9,132  |  | $ | 10,781
|                                                                         |  |                            |       |                         
|Effect of FSP ABP 14-1                                                   |  |                            | 1,356 |                          |   | 1,621 |  |      | 2,975  |  |   | 3,218 
|                                                                         |  |                            |       |                          |   |       |  |      |        |  |   |       
|                                                                         |  |                            |       |                         
|Total interest expense on Exchangeable Notes                             |  | $                          | 5,581 |                          | $ | 7,012 |  | $    | 12,107 |  | $ | 13,999
|                                                                         |  |                            |       |                          |   |       |  |      |        |  |   |       

SFAS No. 141(R)

On January 1, 2009, we adopted SFAS No. 141R, Business Combinations (SFAS 141R). SFAS 141R requires acquisition related costs
to be immediately expensed as period costs. SFAS 141R also requires that 100% of the assets and liabilities of an acquired entity, as opposed to the amount proportional to the portion acquired, must be recorded at fair value upon an acquisition and
that a gain or loss must be recognized for the difference between the fair value and the carrying value of any existing ownership interests in acquired entities. Finally, SFAS 141R, as interpreted by FSP FAS 141R-1, Accounting for Assets Acquired
and Liabilities Assumed in a Business Combination That Arise from Contingencies, requires that contingencies arising from a business combination be recorded at fair value if the acquisition date fair value can be determined during the
measurement period.

SFAS No. 160

On January 1, 2009, we adopted SFAS No. 160, Noncontrolling Interests in the Consolidated Financial Statements  an amendment to ARB No. 51 (SFAS 160). SFAS 160 requires
noncontrolling interests (previously referred to as minority interests) to be reported as a component of total equity, which changes the presentation of the noncontrolling interests in the consolidated balance sheets and statements of operations as
well as changing the accounting for changes in the level of ownership in consolidated subsidiaries. The change in the classification of noncontrolling interests on the consolidated statements of operations caused an increase of $1,000 and a decrease
of $292,000 to previously reported net income for the three and six months ended June 30, 2008, respectively.

FSP on Emerging
Issues Task Force issue 03-6-1

During the first quarter of 2009, we adopted FSP Emerging Issues Task Force (EITF) 03-6-1,
Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities (FSP EITF 03-6-1), which we have applied retrospectively to prior period calculations of basic and diluted earnings per
Common Unit. Pursuant to FSP EITF 03-6-1, certain of the General Partners share-based awards are considered participating securities because they earn dividend equivalents that are not forfeited even if the underlying award does not vest.



- 8 -



---

##### Table of Contents

The effect of including the General Partners share-based awards as participating securities
resulted in a decrease to basic net income attributable to common unitholders of approximately $402,000 and $809,000 in the three and six months ended June 30, 2008, respectively. Because those share-based awards were included as participating
securities for computation of basic net income per Common Unit, applying the treasury stock method to those share-based awards would have been anti-dilutive for computing diluted earnings per Common Unit, thus the implementation of FSP EITF 03-6-1
also resulted in a decrease to diluted net income attributable to common unitholders of approximately $402,000 and $809,000 and a reduction in dilutive potential units outstanding of approximately 440,000 and 417,000 in the three and six months
ended June 30, 2008, respectively.

SFAS No. 165

During the second quarter of 2009, we adopted SFAS No. 165, Subsequent Events (SFAS 165). This standard codifies authoritative
guidance within the GAAP hierarchy for the accounting for, and disclosure of, subsequent events. SFAS 165 will not change our existing accounting practices for subsequent events, as it is a codification of authoritative guidance that was previously
included in generally accepted auditing standards.

FSP FAS 107-1 and APB 28-1

During the second quarter of 2009, we adopted FSP FAS 107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments (FSP
FAS 107-1). FSP FAS 107-1 requires the fair value of debt to be disclosed on a quarterly basis in the notes to the financial statements. These disclosures were previously only required to be made annually. The required disclosures are made in
Note 5.

SFAS No. 168

In June 2009, the FASB issued SFAS No. 168, FASB Accounting Standards Codification (SFAS 168). SFAS 168 reorganizes all existing authoritative pronouncements from the various U.S. accounting standard setters into one
comprehensive body of literature. The codification will have no effect on any of our accounting methods, but will require references to the currently existing pronouncements to be updated to the new nomenclature. SFAS 168 will be effective for all
fiscal years and interim periods beginning after September 15, 2009.

SFAS No. 167

In June 2009, the FASB issued SFAS No. 167, Amendments to FASB Interpretation No. 46(R) (SFAS 167). SFAS 167 eliminates the
primarily quantitative model used under FIN 46(R) to determine the primary beneficiary of a variable interest entity (VIE) and replaces it with a qualitative model that focuses on which entities have the power to direct the activities of
the VIE as well as the obligation or rights to absorb the VIEs losses or receive its benefits. The reconsideration of the initial determination of VIE status is still based on the occurrence of certain events. SFAS 167 will be effective for
fiscal years and interim periods beginning after November 15, 2009. We do not believe there will be any material impact on our results of operation or financial position when we adopt SFAS 167 because we currently do not have any investments,
or other variable interests, in entities that were determined to be VIEs.



- 9 -



---

##### Table of Contents

|3. | Consolidation of Retail Joint Ventures
|-- | --------------------------------------

Through
March 31, 2009, we were a member in two retail real estate joint ventures with a retail developer. Both entities were jointly controlled by us and our partner, through equal voting interests, and were accounted for as unconsolidated
subsidiaries under the equity method. As of April 1, 2009, we had made combined equity contributions of $37.9 million to the two entities and we also had combined outstanding principal and accrued interest of $173.0 million on advances to the
two entities.

We advanced $2.0 million to the two entities, who then distributed the $2.0 million to our partner in exchange for the
redemption of our partners membership interests, effective April 1, 2009, at which time we obtained 100% control of the voting interests of both entities. We entered these transactions to gain control of these two entities because it will
allow us to operate or dispose of the entities in a manner that best serves our capital needs.

In conjunction with the redemption of our
partners membership interests, we entered a profits interest agreement that entitles our former partner to additional payments should the combined sales of the two acquired entities, as well as the sale of another retail real estate joint
venture that we and our partner still jointly control, result in an aggregate profit. Aggregate profit on the sale of these three projects will be calculated by using a formula defined in the profits interest agreement. We have estimated that the
fair value of the potential additional payment to our partner is insignificant and, thus, did not recognize a liability at the acquisition date.

A summary of the fair value of amounts recognized, as of the acquisition date, for each major class of assets and liabilities, is as follows (in thousands):



|                                                        |  |   |         |  
|------------------------------------------------------- |  | - | ------- | -
|Operating rental properties                             |  | $ | 176,038 |  
|Undeveloped land                                        |  |   | 6,500   |  
|                                                        |  |   |         |  
|Total real estate investments                           |  |   | 182,538 |  
|                                                        | 
|Other assets                                            |  |   | 3,987   |  
|Lease related intangible assets                         |  |   | 25,970  |  
|                                                        |  |   |         |  
|Total assets acquired                                   |  |   | 212,495 |  
|                                                        | 
|Liabilities assumed                                     |  |   | (5,643  | )
|                                                        |  |   |         |  
|                                                        | 
|Net recognized value of acquired assets and liabilities |  | $ | 206,852 |  
|                                                        |  |   |         |  

The fair values recognized from the real estate and related assets acquired were primarily
determined using the income approach. The most significant assumptions in the fair value estimates were the discount rates and the exit capitalization rates. The estimates of fair value were determined to have primarily relied upon level 3 inputs.

We recognized a loss of $999,000 upon acquisition, which represents the difference between the fair value of the recognized assets and the
carrying value of our pre-existing equity interest. The acquisition date fair value of the net recognized assets as compared to the acquisition date carrying value of our outstanding advances and accrued interest, as well as the acquisition date
carrying value of our pre-existing equity interests, is shown as follows (in thousands):



|                                                                    |  |   |          |  
|------------------------------------------------------------------- |  | - | -------- | -
|Net fair value of acquired assets and liabilities                   |  | $ | 206,852  |  
|Less advances to acquired entities eliminated upon consolidation    |  |   | (173,006 | )
|Less acquisition date carrying value of equity in acquired entities |  |   | (34,845  | )
|                                                                    |  |   |          |  
|Loss on business combination                                        |  | $ | (999     | )
|                                                                    |  |   |          |  



- 10 -



---

##### Table of Contents

Since April 1, 2009, the results of operations for both acquired entities have been included in
continuing operations in our consolidated financial statements. Due to our significant pre-existing ownership and financing positions in the two acquired entities, the inclusion of their results of operations did not have a material effect on our
operating income.



|4. | Reclassifications
|-- | -----------------

Certain amounts in the
accompanying consolidated financial statements for 2008 have been reclassified to conform to the 2009 consolidated financial statement presentation.



|5. | Indebtedness
|-- | ------------

The following table summarizes the
book value and changes in the fair value of our debt for the six months ended June 30, 2009 (in thousands):



|                           |  |                       |           |                      |   |                       |  |                                            |           |  |                   |         |   |                          |   |          |                      |  |   |         |   |  |   |          
|-------------------------- |  | --------------------- | --------- | -------------------- | - | --------------------- |  | ------------------------------------------ | --------- |  | ----------------- | ------- | - | ------------------------ | - | -------- | -------------------- |  | - | ------- | - |  | - | ---------
|                           |  | Book Valueat 12/31/08 |           | Book Valueat 6/30/09 |   | Fair Valueat 12/31/08 |  | Total Realizedand UnrealizedLosses/(Gains) |           |  | Issuances/Payoffs |         |   | Adjustments toFair Value |   |          | Fair Valueat 6/30/09
|Fixed rate secured debt    |  | $                     | 499,061   |                      | $ | 657,663               |  | $                                          | 438,049   |  | $                 |        |   |                          | $ | 164,500  |                      |  | $ | (3,186  | ) |  | $ | 599,363  
|Variable rate secured debt |  |                       | 8,290     |                      |   | 8,742                 |  |                                            | 8,290     |  |                   |        |   |                          |   | 452      |                      |  |   |        |   |  |   | 8,742    
|Fixed rate unsecured notes |  |                       | 3,285,980 |                      |   | 2,978,568             |  |                                            | 2,196,689 |  |                   | (40,972 | ) |                          |   | (314,947 | )                    |  |   | 507,696 |   |  |   | 2,348,465
|Unsecured lines of credit  |  |                       | 483,659   |                      |   | 92,923                |  |                                            | 477,080   |  |                   |        |   |                          |   | (390,736 | )                    |  |   | 3,265   |   |  |   | 89,609   
|                           |  |                       |           |                      |   |                       |  |                                            |           |  |                   |         |   |                          |   |          |                      |  |   |         |   |  |   |          
|Total                      |  | $                     | 4,276,990 |                      | $ | 3,737,896             |  | $                                          | 3,120,108 |  | $                 | (40,972 | ) |                          | $ | (540,731 | )                    |  | $ | 507,775 |   |  | $ | 3,046,179
|                           |  |                       |           |                      |   |                       |  |                                            |           |  |                   |         |   |                          |   |          |                      |  |   |         |   |  |   |          

Fixed Rate Secured Debt

In February and March 2009, we received net proceeds of $156.0 million from two 10-year secured debt financings that are secured by 22 existing rental
properties. The secured debt bears interest at a weighted average rate of 7.6% and matures in 2019.

We utilized a discounted cash flow
methodology in order to determine the fair value of our fixed rate secured debt. The net present value of the difference between future contractual interest payments and future interest payments based on our estimate of a current market rate
represents the difference between the book value and the fair value. Our estimate of a current market rate is based upon the rate at which we estimate we could obtain similar borrowings when considering current market conditions. The current market
rates we utilized were internally estimated; therefore, we have concluded that our determination of fair value for our fixed rate secured debt was primarily based upon Level 3 inputs.

Fixed Rate Unsecured Debt

In
February 2009, we repaid $124.0 million of 6.83% corporate unsecured debt at its scheduled maturity date. During the six-month period ended June 30, 2009, we also repurchased portions of various series of senior unsecured notes on the open
market for $150.0 million. The total face value of these repurchases was $191.0 million. We recognized a gain of $34.5 million on the repurchases, after writing off applicable issuance costs.

We utilized multiple broker estimates in estimating the fair value of our fixed rate unsecured debt. Our unsecured notes are thinly traded and, in many
cases, the broker estimates were not based upon comparable transactions. As such, we have determined that our estimation of the fair value of our fixed rate unsecured debt was primarily based upon Level 3 inputs.



- 11 -



---

##### Table of Contents

The indentures (and related supplemental indentures) governing our outstanding series of notes also
require us to comply with financial ratios and other covenants regarding our operations. We were in compliance with all such covenants as of June 30, 2009.

Unsecured Lines of Credit

Our unsecured lines of credit as of June 30, 2009 are described as
follows (in thousands):



|                                                   |  |                   |           |              |              |                                     |   |       
|-------------------------------------------------- |  | ----------------- | --------- | ------------ | ------------ | ----------------------------------- | - | ------
|Description                                        |  | BorrowingCapacity |           | MaturityDate |              | Outstanding Balanceat June 30,
2009
|Unsecured Line of Credit - Partnership             |  | $                 | 1,300,000 |              | January 2010 |                                     | $ | 78,000
|Unsecured Line of Credit - Consolidated Subsidiary |  | $                 | 30,000    |              | July 2011    |                                     | $ | 14,923

We use the Partnerships unsecured line of credit to fund development activities, acquire
additional rental properties and provide working capital. This line of credit provides us with an option to obtain borrowings from financial institutions that participate in the line, at rates that may be lower than the stated interest rate, subject
to certain restrictions. The stated rate on the amounts outstanding on the Partnerships unsecured line of credit as of June 30, 2009 was LIBOR plus .65% (equal to .96% as of June 30, 2009). We may, at our sole discretion, exercise an
option to extend the maturity date of the Partnerships line of credit to January 2011. This line of credit also contains various financial covenants that require us to meet financial ratios and defined levels of performance, including those
related to fixed charge coverage, variable rate indebtedness, consolidated net worth and debt-to-asset value (with asset value being defined in the Partnerships line of credit agreement). As of June 30, 2009, we were in compliance with
all covenants under this line of credit.

The consolidated subsidiarys unsecured line of credit allows for borrowings up to $30.0
million at a rate of LIBOR plus .85% (equal to 1.16% for outstanding borrowings as of June 30, 2009). This unsecured line of credit is used to fund development activities within the consolidated subsidiary and matures in July 2011 with, at our
option, a 12-month extension option.

We utilized a discounted cash flow methodology in order to estimate the fair value of our unsecured
lines of credit. The net present value of the difference between future contractual interest payments and future interest payments based on our estimate of a current market rate represents the difference between the book value and the fair value.
Our estimate of a current market rate is based upon the rate, considering current market conditions and our specific credit profile, at which we estimate we could obtain similar borrowings. The current market rate we utilized was internally
estimated; therefore, we have concluded that our determination of fair value for our unsecured lines of credit was primarily based upon Level 3 inputs.



|6. | Partners Equity
|-- | ----------------

In April 2009, the General
Partner issued 75.2 million shares of its common stock for net proceeds of $551.9 million. The proceeds from this offering were contributed to us in exchange for an additional interest in the Partnership and were then used to repay outstanding
borrowings under the Partnerships unsecured line of credit and for other general corporate purposes.



- 12 -



---

##### Table of Contents

|7. | Related Party Transactions
|-- | --------------------------

We provide property
management, leasing, construction and other tenant related services to unconsolidated companies in which we have equity interests. For the six months ended June 30, 2009 and 2008, respectively, we earned management fees of $4.2 million and $3.8
million, leasing fees of $2.1 million and $1.4 million and construction and development fees of $6.4 million and $6.0 million from these companies. We recorded these fees based on contractual terms that approximate market rates for these types of
services and we have eliminated our ownership percentage of these fees in the consolidated financial statements.



|8. | Net Income Per Common Unit
|-- | --------------------------

Basic net income per
Common Unit is computed by dividing net income attributable to common unitholders, less distributions on the General Partners share-based awards expected to vest, by the weighted average number of Common Units outstanding for the period.
Diluted net income per Common Unit is computed by dividing basic net income attributable to common unitholders by the sum of the weighted average number of Common Units outstanding and any potential dilutive securities for the period.

The following table reconciles the components of basic and diluted net income per Common Unit for the three and six months ended June 30, 2009 and
2008, respectively (in thousands):



|                                                                          |  |                             |         |   |                           |   |         |      |  |   |         |   |  |   |         |  
|------------------------------------------------------------------------- |  | --------------------------- | ------- | - | ------------------------- | - | ------- | ---- |  | - | ------- | - |  | - | ------- | -
|                                                                          |  | Three Months Ended June 30, |         |   | Six Months Ended June 30, |  
|                                                                          |  | 2009                        |         |   | 2008                      |   |         | 2009 |  |   | 2008    |  
|Net income (loss) attributable to common unitholders                      |  | $                           | (33,457 | ) |                           | $ | 17,361  |      |  | $ | (9,150  | ) |  | $ | 20,073  |  
|Less: Distributions on share-based awards expected to vest                |  |                             | (403    | ) |                           |   | (402    | )    |  |   | (976    | ) |  |   | (809    | )
|                                                                          |  |                             |         |   |                           |   |         |      |  |   |         |   |  |   |         |  
|Basic and diluted net income (loss) attributable to common unitholders    |  | $                           | (33,860 | ) |                           | $ | 16,959  |      |  | $ | (10,126 | ) |  | $ | 19,264  |  
|                                                                          |  |                             |         |   |                           |   |         |      |  |   |         |   |  |   |         |  
|                                                                          |  |                             |         |  
|Weighted average number of Common Units outstanding                       |  |                             | 214,015 |   |                           |   | 154,425 |      |  |   | 184,797 |   |  |   | 154,307 |  
|Other potential dilutive units (1)                                        |  |                             |        |   |                           |   | 199     |      |  |   |        |   |  |   | 170     |  
|                                                                          |  |                             |         |   |                           |   |         |      |  |   |         |   |  |   |         |  
|Weighted average number of Common Units and potential dilutive securities |  |                             | 214,015 |   |                           |   | 154,624 |      |  |   | 184,797 |   |  |   | 154,477 |  
|                                                                          |  |                             |         |   |                           |   |         |      |  |   |         |   |  |   |         |  



|(1) | Excludes (in thousands of units) 7,677 and 7,637 of anti-dilutive potential units for the three months ended June 30, 2009 and 2008, respectively, and 7,722 and 7,514 of
anti-dilutive potential units for the six months ended June 30, 2009 and 2008, respectively, related to stock-based compensation plans. Also excludes (in thousands of units) the Exchangeable Notes that have 9,051 of anti-dilutive potential
units for the three and six months ended June 30, 2009 and 11,756 of anti-dilutive potential units for the three and six months ended June 30, 2008.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|9. | Segment Reporting
|-- | -----------------

We have three reportable
operating segments, the first two of which consist of the ownership and rental of office and industrial real estate investments. The operations of our office and industrial properties, along with our healthcare and retail properties, are
collectively referred to as Rental Operations. Our healthcare and retail properties, which do not meet the quantitative thresholds defined in SFAS No. 131, Disclosures about Segments of an Enterprise and Related Information,
are not separately presented as a reportable segment. The third reportable segment consists of providing various real estate services such as property management, maintenance, leasing, development and construction management to third-party property
owners and joint ventures, as well as our Build-for-Sale operations (defined below), and is collectively referred to as Service Operations. Our reportable segments offer different products or services and are managed separately because
each segment requires different operating strategies and management expertise.

Gains on sale of properties developed or acquired with the
intent to sell (Build-for-Sale properties) are classified as part of the income of the Service Operations business segment. The periods of operation for Build-for-Sale properties prior to sale were of short duration.



- 13 -



---

##### Table of Contents

Other revenue consists of other operating revenues not identified with one of our operating segments.
Interest expense and other non-property specific revenues and expenses are not allocated to individual segments in determining our performance measure.

We assess and measure our overall operating results based upon an industry performance measure referred to as Funds From Operations (FFO), which management believes is a useful indicator of our
consolidated operating performance. FFO is used by industry analysts and investors as a supplemental operating performance measure of a REIT like our General Partner. The National Associations of Real Estate Investment Trusts (NAREIT)
created FFO as a supplemental measure of REIT operating performance that excludes historical cost depreciation, among other items, from net income determined in accordance with GAAP. FFO is a non-GAAP financial measure. The most comparable GAAP
measure is net income (loss) attributable to common unitholders. Consolidated basic FFO attributable to common unitholders should not be considered as a substitute for net income or any other measures derived in accordance with GAAP and may not be
comparable to other similarly titled measures of other companies. FFO is calculated in accordance with the definition that was adopted by the Board of Governors of NAREIT. We do not allocate certain income and expenses (Non-Segment Items
as shown in the table below) to our operating segments. Thus, the operational performance measure presented here on a segment-level basis represents net earnings excluding depreciation expense, as well as excluding the Non-Segment Items not
allocated, and is not meant to present FFO as defined by NAREIT.

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 instead have historically risen or fallen with market conditions, many industry analysts and investors have considered presentation of
operating results for real estate companies that use historical cost accounting to be insufficient by themselves. FFO, as defined by NAREIT, represents GAAP net income (loss), excluding extraordinary items as defined under GAAP and gains or losses
from sales of previously depreciated real estate assets, plus certain non-cash items such as real estate asset depreciation and amortization, and after similar adjustments for unconsolidated partnerships and joint ventures.

Management believes that the use of consolidated basic FFO attributable to common unitholders, combined with net income (which remains the primary measure
of performance), improves the understanding of operating results of REITs among the investing public and makes comparisons of REIT operating results more meaningful. Management believes that, by excluding gains or losses related to sales of
previously depreciated real estate assets and excluding real estate asset depreciation and amortization, investors and analysts are able to readily identify the operating results of the long-term assets that form the core of a REITs activity
and assist in comparing these operating results between periods or as compared to different companies.



- 14 -



---

##### Table of Contents

The following table shows (i) the revenues for each of the reportable segments and (ii) a
reconciliation of consolidated basic FFO attributable to common unitholders to net income (loss) attributable to common unitholders for the three and six months ended June 30, 2009 and 2008, respectively (in thousands):



|                                                                    |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|------------------------------------------------------------------- |  | --------------------------- | ------- | - | ------------------------- | - | ------- | ---- |  | - | -------- | - |  | - | -------- | -
|                                                                    |  | Three Months Ended June 30, |         |   | Six Months Ended June 30, |  
|                                                                    |  | 2009                        |         |   | 2008                      |   |         | 2009 |  |   | 2008     |  
|Revenues                                                            |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|Rental Operations:                                                  |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|Office                                                              |  | $                           | 142,314 |   |                           | $ | 136,814 |      |  | $ | 285,403  |   |  | $ | 276,476  |  
|Industrial                                                          |  |                             | 65,621  |   |                           |   | 60,784  |      |  |   | 130,799  |   |  |   | 121,835  |  
|Non-reportable Rental Operations segments                           |  |                             | 13,848  |   |                           |   | 8,131   |      |  |   | 22,745   |   |  |   | 14,360   |  
|Service Operations                                                  |  |                             | 127,242 |   |                           |   | 94,248  |      |  |   | 232,336  |   |  |   | 178,531  |  
|                                                                    |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|Total Segment Revenues                                              |  |                             | 349,025 |   |                           |   | 299,977 |      |  |   | 671,283  |   |  |   | 591,202  |  
|Other Revenue                                                       |  |                             | 3,204   |   |                           |   | 5,884   |      |  |   | 6,753    |   |  |   | 10,577   |  
|                                                                    |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|Consolidated Revenue from continuing operations                     |  |                             | 352,229 |   |                           |   | 305,861 |      |  |   | 678,036  |   |  |   | 601,779  |  
|Discontinued Operations                                             |  |                             | 190     |   |                           |   | 3,685   |      |  |   | 2,282    |   |  |   | 13,507   |  
|                                                                    |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|Consolidated Revenue                                                |  | $                           | 352,419 |   |                           | $ | 309,546 |      |  | $ | 680,318  |   |  | $ | 615,286  |  
|                                                                    |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|Reconciliation of Consolidated Basic Funds From Operations          |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|Net earnings excluding depreciation and Non-Segment Items:          |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|Office                                                              |  | $                           | 85,271  |   |                           | $ | 84,005  |      |  | $ | 166,443  |   |  | $ | 166,924  |  
|Industrial                                                          |  |                             | 50,373  |   |                           |   | 47,000  |      |  |   | 98,362   |   |  |   | 92,189   |  
|Non-reportable Rental Operations segments                           |  |                             | 9,068   |   |                           |   | 5,171   |      |  |   | 14,571   |   |  |   | 8,854    |  
|Service Operations                                                  |  |                             | 8,967   |   |                           |   | 10,390  |      |  |   | 17,315   |   |  |   | 14,803   |  
|                                                                    |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|                                                                    |  |                             | 153,679 |   |                           |   | 146,566 |      |  |   | 296,691  |   |  |   | 282,770  |  
|Non-Segment Items:                                                  |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|Interest expense                                                    |  |                             | (52,025 | ) |                           |   | (47,841 | )    |  |   | (104,073 | ) |  |   | (95,944  | )
|Impairment charges                                                  |  |                             | (17,131 | ) |                           |   | (1,991  | )    |  |   | (17,469  | ) |  |   | (2,799   | )
|Interest and other income                                           |  |                             | 5       |   |                           |   | (541    | )    |  |   | 128      |   |  |   | 1,018    |  
|General and administrative expenses                                 |  |                             | (13,600 | ) |                           |   | (6,889  | )    |  |   | (23,480  | ) |  |   | (19,052  | )
|Gain on land sales                                                  |  |                             |        |   |                           |   | 3,393   |      |  |   | 357      |   |  |   | 4,022    |  
|Undeveloped land carrying costs                                     |  |                             | (2,680  | ) |                           |   | (1,911  | )    |  |   | (5,045   | ) |  |   | (4,060   | )
|Gain on extinguishment of debt                                      |  |                             | 1,449   |   |                           |   |        |      |  |   | 34,511   |   |  |   |         |  
|Loss on business combinations                                       |  |                             | (999    | ) |                           |   |        |      |  |   | (999     | ) |  |   |         |  
|Other non-segment income (expense)                                  |  |                             | 1,313   |   |                           |   | 4,714   |      |  |   | 4,079    |   |  |   | 8,866    |  
|Net (income) loss attributable to noncontrolling interests          |  |                             | 4       |   |                           |   | (1      | )    |  |   | 87       |   |  |   | 292      |  
|Joint venture items                                                 |  |                             | 10,713  |   |                           |   | 13,564  |      |  |   | 24,458   |   |  |   | 30,531   |  
|Distributions on Preferred Units                                    |  |                             | (18,363 | ) |                           |   | (18,866 | )    |  |   | (36,726  | ) |  |   | (34,172  | )
|Discontinued operations                                             |  |                             | (802    | ) |                           |   | 891     |      |  |   | (342     | ) |  |   | 7,207    |  
|                                                                    |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|Consolidated basic FFO attributable to common unitholders           |  |                             | 61,563  |   |                           |   | 91,088  |      |  |   | 172,177  |   |  |   | 178,679  |  
|Depreciation and amortization on continuing operations              |  |                             | (86,745 | ) |                           |   | (75,525 | )    |  |   | (166,678 | ) |  |   | (151,129 | )
|Depreciation and amortization on discontinued operations            |  |                             | (73     | ) |                           |   | (1,050  | )    |  |   | (348     | ) |  |   | (4,567   | )
|Partnerships share of joint venture adjustments                    |  |                             | (8,251  | ) |                           |   | (7,159  | )    |  |   | (19,469  | ) |  |   | (14,046  | )
|Earnings from depreciated property sales on discontinued operations |  |                             | 49      |   |                           |   | 9,531   |      |  |   | 5,168    |   |  |   | 10,641   |  
|Earnings from depreciated property sales-share of joint venture     |  |                             |        |   |                           |   | 476     |      |  |   |         |   |  |   | 495      |  
|                                                                    |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  
|Net income (loss) attributable to common unitholders                |  | $                           | (33,457 | ) |                           | $ | 17,361  |      |  | $ | (9,150   | ) |  | $ | 20,073   |  
|                                                                    |  |                             |         |   |                           |   |         |      |  |   |          |   |  |   |          |  



|10. | Discontinued Operations and Impairments
|--- | ---------------------------------------

The
operations of eleven buildings are currently classified as discontinued operations for the six-month periods ended June 30, 2009 and June 30, 2008. These eleven buildings consist of four industrial and seven office properties. Of these
properties, three were sold during the first six months of 2009 and eight were sold during 2008.

We allocate interest expense to
discontinued operations and have included such interest expense in computing income from discontinued operations. Interest expense allocable to discontinued operations includes interest on any secured debt for properties included in discontinued
operations and an allocable share of our consolidated unsecured interest expense for unencumbered properties. The allocation of unsecured interest expense to discontinued operations was based upon the gross book value of the unencumbered real estate
assets included in discontinued operations as it related to the total gross book value of our unencumbered real estate assets.



- 15 -



---

##### Table of Contents

The following table illustrates the operations of the buildings reflected in discontinued operations for
the three and six months ended June 30, 2009 and 2008, respectively (in thousands):



|                                                          |  |                            |      |   |                          |   |        |      |  |   |        |   |  |   |        |  
|--------------------------------------------------------- |  | -------------------------- | ---- | - | ------------------------ | - | ------ | ---- |  | - | ------ | - |  | - | ------ | -
|                                                          |  | Three Months EndedJune 30, |      |   | Six Months EndedJune 30, |  
|                                                          |  | 2009                       |      |   | 2008                     |   |        | 2009 |  |   | 2008   |  
|Revenues                                                  |  | $                          | 190  |   |                          | $ | 3,685  |      |  | $ | 2,282  |   |  | $ | 13,507 |  
|Operating expenses                                        |  |                            | (165 | ) |                          |   | (1,722 | )    |  |   | (1,201 | ) |  |   | (3,893 | )
|Depreciation and amortization                             |  |                            | (73  | ) |                          |   | (1,050 | )    |  |   | (348   | ) |  |   | (4,567 | )
|                                                          |  |                            |      |   |                          |   |        |      |  |   |        |   |  |   |        |  
|Operating income (loss)                                   |  |                            | (48  | ) |                          |   | 913    |      |  |   | 733    |   |  |   | 5,047  |  
|Interest expense                                          |  |                            | (55  | ) |                          |   | (1,072 | )    |  |   | (651   | ) |  |   | (2,407 | )
|                                                          |  |                            |      |   |                          |   |        |      |  |   |        |   |  |   |        |  
|Income (loss) before impairment charges and gain on sales |  |                            | (103 | ) |                          |   | (159   | )    |  |   | 82     |   |  |   | 2,640  |  
|Impairment charges                                        |  |                            | (772 | ) |                          |   |       |      |  |   | (772   | ) |  |   |       |  
|Gain on sale of depreciable properties                    |  |                            | 49   |   |                          |   | 9,531  |      |  |   | 5,168  |   |  |   | 10,641 |  
|                                                          |  |                            |      |   |                          |   |        |      |  |   |        |   |  |   |        |  
|Income (loss) from discontinued operations                |  | $                          | (826 | ) |                          | $ | 9,372  |      |  | $ | 4,478  |   |  | $ | 13,281 |  
|                                                          |  |                            |      |   |                          |   |        |      |  |   |        |   |  |   |        |  

We recognized $6.2 million of impairment charges in continuing operations on office and industrial
buildings that were sold during the three-month period ended June 30, 2009, or are probable of being sold thereafter, as well as $4.6 million of impairment charges on certain parcels of undeveloped land that were sold during, or that sold
shortly after, the three-month period ended June 30, 2009. The buildings sold were not included in discontinued operations because of our continuing involvement, either through a noncontrolling equity interest or a property management
agreement. The fair value used in determining the impairment charges for the aforementioned buildings and land were primarily based upon our realized, or contractually agreed, exit prices upon sale and, thus, we have determined that the valuations
relied primarily upon level 1 inputs, as defined. These charges were the result of increases in estimated capitalization rates and changes in market conditions that negatively affected values.

Due to credit issues with its most significant tenant, an inability to renew third party financing on acceptable terms and an increase to its projected
capital expenditures, we analyzed an investment in an unconsolidated joint venture to determine whether there was an other than temporary decline in value. As the result of that analysis, we determined that an other than temporary loss in value had
taken place and wrote our investment in the joint venture down to its fair value, thus recognizing a $5.8 million impairment charge. We estimated the fair value of the joint venture using the income approach and the most significant assumption in
the estimate was the expected period of time in which we would hold our investment in the joint venture. We concluded that the estimate of fair value relied primarily upon level 3 inputs, as defined.



|11. | Subsequent Events
|--- | -----------------

Declaration of Distributions

The General Partners board of directors declared the following distributions at its regularly scheduled board meeting held on
July 29, 2009:



|                                 |  |                      |          |             |                    |              |                   
|-------------------------------- |  | -------------------- | -------- | ----------- | ------------------ | ------------ | ------------------
|Class                            |  | QuarterlyAmount/Unit |          | Record Date |                    | Payment Date
|Common                           |  | $                    | 0.17     |             | August 14, 2009    |              | August 31, 2009   
|Preferred (per depositary unit): |  |                      |          |             |                    |              |                   
|Series J                         |  | $                    | 0.414063 |             | August 17, 2009    |              | August 31, 2009   
|Series K                         |  | $                    | 0.406250 |             | August 17, 2009    |              | August 31, 2009   
|Series L                         |  | $                    | 0.412500 |             | August 17, 2009    |              | August 31, 2009   
|Series M                         |  | $                    | 0.434375 |             | September 16, 2009 |              | September 30, 2009
|Series N                         |  | $                    | 0.453125 |             | September 16, 2009 |              | September 30, 2009
|Series O                         |  | $                    | 0.523438 |             | September 16, 2009 |              | September 30, 2009



- 16 -



---

##### Table of Contents

At a special meeting held on July 22, 2009, the General Partners shareholders approved an
increase in the number of authorized shares of its common stock from 250 million to 400 million.

In July 2009, we received net
proceeds of $114.0 million from a 10-year secured debt financing that is secured by a portfolio of suburban office and industrial rental properties. The secured debt bears interest at a rate of 7.75% and matures in 2019.

In August 2009, we issued $250.0 million of senior unsecured notes due in 2015 bearing interest at 7.375% and $250.0 million of senior unsecured notes due
in 2019 bearing interest at 8.25%.

Subsequent events have been evaluated through the issuance date of these financial statements.



|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations
|------- | -------------------------------------------------------------------------------------

Cautionary Notice Regarding Forward-Looking Statements

Certain statements contained in or incorporated by
reference into this Report, including, without limitation, those related to our future operations, constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. The words believe, estimate, expect, anticipate, intend, plan, seek, may, and
similar expressions or statements regarding future periods are intended to identify forward-looking statements.

These forward-looking statements involve
known and unknown risks, uncertainties and other important factors that could cause our actual results, performance or achievements, or industry results, to differ materially from any predictions of future results, performance or achievements that
we express or imply in this Report. Some of the risks, uncertainties and other important factors that may affect future results include, among others:



| |  |  | Changes in general economic and business conditions, including, without limitation, the impact of the current credit crisis and economic down-turn, which are having
and may continue to have a negative effect on the fundamentals of our business, the financial condition of our tenants and our lenders, and the value of our real estate assets;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The General Partners continued qualification as a real estate investment trust, or REIT, for U.S. federal income tax purposes;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------



| |  |  | Heightened competition for tenants and potential decreases in property occupancy;
| | - |  | ---------------------------------------------------------------------------------



| |  |  | Potential increases in real estate construction costs;
| | - |  | ------------------------------------------------------



| |  |  | Potential changes in the financial markets and interest rates;
| | - |  | --------------------------------------------------------------



| |  |  | Volatility in the General Partners stock price and trading volume;
| | - |  | -------------------------------------------------------------------



| |  |  | Our continuing ability to raise funds on favorable terms, if at all, through the issuance of debt and equity in the capital markets, which may negatively affect
both our ability to refinance our existing debt as well as our future interest expense;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Our ability to successfully identify, acquire, develop and/or manage properties on terms that are favorable to us;
| | - |  | ------------------------------------------------------------------------------------------------------------------



| |  |  | Our ability to be flexible in the development and operations of joint venture properties;
| | - |  | -----------------------------------------------------------------------------------------



| |  |  | Our ability to successfully dispose of properties, if at all, on terms that are favorable to us;
| | - |  | ------------------------------------------------------------------------------------------------



| |  |  | Inherent risks in the real estate business including, but not limited to, tenant defaults, potential liability relating to environmental matters and liquidity of
real estate investments; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Other risks and uncertainties described herein, as well as those risks and uncertainties discussed from time to time in the Partnerships and the General
Partners other reports and other public filings with the Securities and Exchange Commission (SEC).
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



- 17 -



---

##### Table of Contents

Although we presently believe that the plans, expectations and results expressed in or suggested by the forward-looking
statements are reasonable, all forward-looking statements are inherently subjective, uncertain and subject to change, as they involve substantial risks and uncertainties beyond our control. New factors emerge from time to time, and it is not
possible for us to predict the nature, or assess the potential impact, of each new factor on our business. Given these uncertainties, we caution you not to place undue reliance on these forward-looking statements. We undertake no obligation to
update or revise any of our forward-looking statements for events or circumstances that arise after the statement is made, except as otherwise may be required by law.

This list of risks and uncertainties, however, is only a summary of some of the most important factors and is not intended to be exhaustive. Additional information regarding risk factors that may affect us is included
under the caption Risk Factors in Part II, Item 1A of this Report, and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2008, which we filed with the SEC on March 6, 2009. The risk factors contained
in our Annual Report are updated by us from time to time in Quarterly Reports on Form 10-Q and other public filings.

Business Overview

We are a limited partnership formed under the laws of the State of Indiana in 1993. We own and operate a portfolio primarily consisting of
industrial and office properties and provide real estate services to third-party owners. We conduct our Service Operations through Duke Realty Services, LLC, Duke Realty Services Limited Partnership and Duke Construction Limited Partnership. A more
complete description of our business, and of managements philosophy and priorities, is included in our Annual Report on Form 10-K.

As of
June 30, 2009 we:



| |  |  | Owned or jointly controlled 765 industrial, office, healthcare and other properties, of which 748 properties with more than 132.5 million square feet are in
service and 17 properties with more than 3.3 million square feet are under development. The 748 in-service properties are comprised of 541 consolidated properties with approximately 90.9 million square feet and 207 jointly controlled
properties with more than 41.6 million square feet. The 17 properties under development consist of 13 consolidated properties with more than 1.7 million square feet and 4 jointly controlled properties with approximately 1.6 million
square feet.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Owned or jointly controlled approximately 7,100 acres of land with an estimated future development potential of more than 106 million square feet of
industrial, office, healthcare and other properties.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Through our Service Operations reportable segment, we provide the following
services for our properties and for certain properties owned by third parties and joint ventures:



| |  |  | Property leasing;
| | - |  | -----------------



| |  |  | Property management;
| | - |  | --------------------



| |  |  | Asset management;
| | - |  | -----------------



| |  |  | Construction;
| | - |  | -------------



| |  |  | Development; and
| | - |  | ----------------



| |  |  | Other tenant-related services.
| | - |  | ------------------------------

Through our Service
Operations, we have historically developed or acquired properties with the intent to sell (hereafter referred to as Build-for-Sale properties). Build-for-Sale properties were generally identified as such prior to construction
commencement and were sold within a relatively short time after being placed in service. We do not anticipate that Build-for-Sale properties will represent a significant component of our operations in the near-term.



- 18 -



---

##### Table of Contents

Key Performance Indicators

Our operating results depend primarily upon rental income from our industrial, office, healthcare and retail properties (collectively referred to as Rental Operations). The following discussion highlights
the areas of Rental Operations that we consider critical for future revenues.

Occupancy Analysis: Our ability to maintain high occupancy
rates is a principal driver of maintaining and increasing rental revenue from continuing operations. The following table sets forth occupancy information regarding our in-service portfolio of consolidated rental properties as of June 30, 2009
and 2008, respectively (in thousands, except percentage data):



|           |  |                  |  |                             |  |       |                  |  |       |   |  |      |   |  |      |  
|---------- |  | ---------------- |  | --------------------------- |  | ----- | ---------------- |  | ----- | - |  | ---- | - |  | ---- | -
|           |  | TotalSquare Feet |  | Percent ofTotal Square Feet |  |       | Percent Occupied | 
|Type       |  | 2009             |  | 2008                        |  | 2009  |                  |  | 2008  |   |  | 2009 |   |  | 2008 |  
|Industrial |  | 56,843           |  | 54,890                      |  | 62.5  | %                |  | 62.3  | % |  | 88.2 | % |  | 86.1 | %
|Office     |  | 31,492           |  | 31,529                      |  | 34.7  | %                |  | 35.8  | % |  | 85.9 | % |  | 87.8 | %
|Other      |  | 2,546            |  | 1,649                       |  | 2.8   | %                |  | 1.9   | % |  | 85.2 | % |  | 87.4 | %
|           |  |                  |  |                             |  |       |                  |  |       |   |  |      |   |  |      |  
|Total      |  | 90,881           |  | 88,068                      |  | 100.0 | %                |  | 100.0 | % |  | 87.4 | % |  | 86.8 | %
|           |  |                  |  |                             |  |       |                  |  |       |   |  |      |   |  |      |  

Lease Expiration and Renewals: Our ability to maintain and improve occupancy rates primarily depends
upon our continuing ability to re-lease expiring space. The following table reflects our consolidated in-service portfolio lease expiration schedule by property type as of June 30, 2009. The table indicates square footage and annualized net
effective rents (based on June 2009 rental revenue) under expiring leases (in thousands, except percentage data):



|                            |  |                 |   |  |                  |         |                 |     |       |            |        |   |                  |   |            |  |        |                  |  |            |         |  |                  |   |  |   |       
|--------------------------- |  | --------------- | - |  | ---------------- | ------- | --------------- | --- | ----- | ---------- | ------ | - | ---------------- | - | ---------- |  | ------ | ---------------- |  | ---------- | ------- |  | ---------------- | - |  | - | ------
|                            |  | Total Portfolio |   |  | Industrial       |         | Suburban Office |     | Other
|Year of Expiration          |  | SquareFeet      |   |  | Ann. RentRevenue |         | % ofRevenue     |     |       | SquareFeet |        |   | Ann. RentRevenue |   | SquareFeet |  |        | Ann. RentRevenue |  | SquareFeet |         |  | Ann. RentRevenue
|Remainder of 2009           |  | 3,206           |   |  | $                | 24,346  |                 | 4   | %     |            | 1,846  |   |                  | $ | 7,799      |  | 1,343  |                  |  | $          | 16,431  |  | 17               |   |  | $ | 116   
|2010                        |  | 8,465           |   |  |                  | 60,585  |                 | 10  | %     |            | 5,517  |   |                  |   | 23,873     |  | 2,934  |                  |  |            | 36,487  |  | 14               |   |  |   | 225   
|2011                        |  | 10,033          |   |  |                  | 70,458  |                 | 11  | %     |            | 6,767  |   |                  |   | 27,636     |  | 3,191  |                  |  |            | 41,490  |  | 75               |   |  |   | 1,332 
|2012                        |  | 8,714           |   |  |                  | 64,937  |                 | 10  | %     |            | 5,331  |   |                  |   | 21,270     |  | 3,315  |                  |  |            | 42,438  |  | 68               |   |  |   | 1,229 
|2013                        |  | 10,448          |   |  |                  | 90,810  |                 | 15  | %     |            | 5,798  |   |                  |   | 24,642     |  | 4,560  |                  |  |            | 64,582  |  | 90               |   |  |   | 1,586 
|2014                        |  | 9,290           |   |  |                  | 60,628  |                 | 10  | %     |            | 6,671  |   |                  |   | 25,355     |  | 2,566  |                  |  |            | 34,263  |  | 53               |   |  |   | 1,010 
|2015                        |  | 7,313           |   |  |                  | 45,134  |                 | 7   | %     |            | 5,714  |   |                  |   | 22,707     |  | 1,588  |                  |  |            | 22,197  |  | 11               |   |  |   | 230   
|2016                        |  | 4,468           |   |  |                  | 31,350  |                 | 5   | %     |            | 2,906  |   |                  |   | 10,004     |  | 1,318  |                  |  |            | 18,023  |  | 244              |   |  |   | 3,323 
|2017                        |  | 5,131           |   |  |                  | 43,288  |                 | 7   | %     |            | 3,038  |   |                  |   | 12,531     |  | 1,651  |                  |  |            | 23,141  |  | 442              |   |  |   | 7,616 
|2018                        |  | 2,923           |   |  |                  | 36,858  |                 | 6   | %     |            | 1,281  |   |                  |   | 6,454      |  | 1,033  |                  |  |            | 15,697  |  | 609              |   |  |   | 14,707
|2019 and Thereafter         |  | 9,399           |   |  |                  | 96,633  |                 | 15  | %     |            | 5,288  |   |                  |   | 26,184     |  | 3,566  |                  |  |            | 58,427  |  | 545              |   |  |   | 12,022
|                            |  |                 |   |  |                  |         |                 |     |       |            |        |   |                  |   |            |  |        |                  |  |            |         |  |                  |   |  |   |       
|Total Leased                |  | 79,390          |   |  | $                | 625,027 |                 | 100 | %     |            | 50,157 |   |                  | $ | 208,455    |  | 27,065 |                  |  | $          | 373,176 |  | 2,168            |   |  | $ | 43,396
|                            |  |                 |   |  |                  |         |                 |     |       |            |        |   |                  |   |            |  |        |                  |  |            |         |  |                  |   |  |   |       
|Total Portfolio Square Feet |  | 90,881          |   |  |                  |         |                 |     |       |            | 56,843 |   |                  |   |            |  | 31,492 |                  |  |            |         |  | 2,546            |   |  |   |       
|                            |  |                 |   |  |                  |         |                 |     |       |            |        |   |                  |   |            |  |        |                  |  |            |         |  |                  |   |  |   |       
|Percent Occupied            |  | 87.4            | % |  |                  |         |                 |     |       |            | 88.2   | % |                  |   |            |  | 85.9   | %                |  |            |         |  | 85.2             | % |  |   |       
|                            |  |                 |   |  |                  |         |                 |     |       |            |        |   |                  |   |            |  |        |                  |  |            |         |  |                  |   |  |   |       

Within our consolidated properties we renewed 77.7% and 78.1% of our leases up for renewal in the three and six
months ended June 30, 2009, totaling approximately 1.5 million and 3.2 million square feet, respectively. This compares to renewals of 81.6% and 75.1% for the three and six months ended June 30, 2008, which totaled approximately
1.2 million and 2.5 million square feet, respectively. We attained 3.3% and 3.8% growth in average contractual rents on the renewals in the three and six months ended June 30, 2009, respectively.

The average term of renewals for the three and six months ended June 30, 2009 was 3.7 and 4.7 years, respectively, compared to an average term of 3.2 and 3.3 years
for the three and six months ended June 30, 2008, respectively.



- 19 -



---

##### Table of Contents

Recent and Future Development:

We had 2.9 million square feet of property under development with total estimated costs upon completion of $636.6 million at June 30, 2009 compared to 9.5 million square feet with total costs of $987.2
million at June 30, 2008. The square footage and estimated costs include both wholly owned and joint venture development activity at 100%. Considering the continued downturn in the economy, we have substantially reduced our level of development
activities and are focused on the lease-up of recent projects.

The following table summarizes our properties under development as of June 30, 2009
(in thousands, except percentage data):



|                         |  |            |  |               |   |  |                            |         |                      |   |                            |  |   |         |    
|------------------------ |  | ---------- |  | ------------- | - |  | -------------------------- | ------- | -------------------- | - | -------------------------- |  | - | ------- | ---
|Ownership Type           |  | SquareFeet |  | PercentLeased |   |  | TotalEstimatedProjectCosts |         | TotalIncurredto Date |   | AmountRemainingto be Spent | 
|Wholly owned properties  |  | 1,735      |  | 89            | % |  | $                          | 297,109 |                      | $ | 167,083                    |  | $ | 130,026 |    
|Joint venture properties |  | 1,116      |  | 26            | % |  |                            | 339,535 |                      |   | 221,489                    |  |   | 118,046 | (1)
|                         |  |            |  |               |   |  |                            |         |                      |   |                            |  |   |         |    
|Total                    |  | 2,851      |  | 65            | % |  | $                          | 636,644 |                      | $ | 388,572                    |  | $ | 248,072 |    
|                         |  |            |  |               |   |  |                            |         |                      |   |                            |  |   |         |    



|(1) | These costs will be primarily financed by remaining availability under inplace construction loan facilities.
|--- | -------------------------------------------------------------------------------------------------------------

Acquisition and Disposition Activity:Gross sales proceeds related to the dispositions of wholly owned undeveloped land and held-for-rental
properties were $102.8 million and $72.5 million for the six months ended June 30, 2009 and 2008, respectively.

Gross sales proceeds related to
dispositions of wholly-owned Build-for-Sale properties were $33.0 million and $51.2 million for the six months ended June 30, 2009 and 2008.

Our
share of proceeds from sales of properties within unconsolidated joint ventures, in which we have less than a 100% interest, totaled $35.1 million for the six months ended June 30, 2008. We had no such dispositions in the same period in 2009.

For the six months ended June 30, 2009, we acquired $17.0 million of income producing properties comprised of two industrial real estate properties
in Savannah, Georgia, compared to acquisitions of $34.8 million of income producing properties in the same market during the same period in 2008. We also acquired $6.2 million of undeveloped land in the six months ended June 30, 2009, compared
to $18.7 million in the same period in 2008.

Funds From Operations

Funds From Operations (FFO) is used by industry analysts and investors as a supplemental operating performance measure of a REIT like our General Partner. FFO is calculated in accordance with the
definition that was adopted by the Board of Governors of the National Association of Real Estate Investment Trusts (NAREIT). NAREIT created FFO as a supplemental measure of REIT operating performance that excludes historical cost
depreciation, among other items, from net income determined in accordance with accounting principles generally accepted in the United States of America (GAAP). FFO is a non-GAAP financial measure. The most comparable GAAP measure is net
income (loss) attributable to common unitholders. FFO attributable to common unitholders should not be considered as a substitute for net income or any other measures derived in accordance with GAAP and may not be comparable to other similarly
titled measures of other companies.



- 20 -



---

##### Table of Contents

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 instead have historically risen or fallen with market conditions, many industry analysts and investors have considered presentation of operating results for real estate
companies that use historical cost accounting to be insufficient by themselves. FFO, as defined by NAREIT, represents GAAP net income (loss), excluding extraordinary items as defined under GAAP and gains or losses from sales of previously
depreciated real estate assets, plus certain non-cash items such as real estate depreciation and amortization, and after similar adjustments for unconsolidated partnerships and joint ventures.

Management believes that the use of FFO attributable to common unitholders, combined with net income (which remains the primary measure of performance), improves the
understanding of operating results of REITs among the investing public and makes comparisons of REIT operating results more meaningful. Management believes that, by excluding gains or losses related to sales of previously depreciated real estate
assets and excluding real estate asset depreciation and amortization, investors and analysts are able to readily identify the operating results of the long-term assets that form the core of a REITs activity and assist in comparing these
operating results between periods or as compared to different companies.

The following table shows a reconciliation of net income (loss) attributable to
common unitholders to the calculation of FFO for the three and six months ended June 30, 2009 and 2008, respectively (in thousands):



|                                                                   |  |                             |         |   |                           |   |        |      |  |   |         |   |  |   |         |  
|------------------------------------------------------------------ |  | --------------------------- | ------- | - | ------------------------- | - | ------ | ---- |  | - | ------- | - |  | - | ------- | -
|                                                                   |  | Three Months Ended June 30, |         |   | Six Months Ended June 30, |  
|                                                                   |  | 2009                        |         |   | 2008                      |   |        | 2009 |  |   | 2008    |  
|Net income (loss) attributable to common unitholders               |  | $                           | (33,457 | ) |                           | $ | 17,361 |      |  | $ | (9,150  | ) |  | $ | 20,073  |  
|Adjustments:                                                       |  |                             |         |   |                           |   |        |      |  |   |         |   |  |   |         |  
|Depreciation and amortization                                      |  |                             | 86,818  |   |                           |   | 76,575 |      |  |   | 167,026 |   |  |   | 155,696 |  
|Partnerships share of joint venture depreciation and amortization |  |                             | 8,251   |   |                           |   | 7,159  |      |  |   | 19,469  |   |  |   | 14,046  |  
|Earnings from depreciable property sales - wholly owned            |  |                             | (49     | ) |                           |   | (9,531 | )    |  |   | (5,168  | ) |  |   | (10,641 | )
|Earnings from depreciable property sales - share of joint venture  |  |                             |        |   |                           |   | (476   | )    |  |   |        |   |  |   | (495    | )
|                                                                   |  |                             |         |   |                           |   |        |      |  |   |         |   |  |   |         |  
|Funds From Operations attributable to common unitholders           |  | $                           | 61,563  |   |                           | $ | 91,088 |      |  | $ | 172,177 |   |  | $ | 178,679 |  
|                                                                   |  |                             |         |   |                           |   |        |      |  |   |         |   |  |   |         |  

Results of Operations

A summary of our operating results and property statistics for the three and six months ended June 30, 2009 and 2008, respectively, is as follows (in thousands, except number of properties and per unit data):



|                                                                |  |                             |         |                           |      |   |         |  |   |         |   |  |   |        
|--------------------------------------------------------------- |  | --------------------------- | ------- | ------------------------- | ---- | - | ------- |  | - | ------- | - |  | - | -------
|                                                                |  | Three Months Ended June 30, |         | Six Months Ended June 30,
|                                                                |  | 2009                        |         |                           | 2008 |   | 2009    |  |   | 2008   
|Rental and related revenue                                      |  | $                           | 224,987 |                           |      | $ | 211,613 |  | $ | 445,700 |   |  | $ | 423,248
|General contractor revenue                                      |  |                             | 119,705 |                           |      |   | 85,635  |  |   | 218,062 |   |  |   | 162,394
|Service fee revenue                                             |  |                             | 7,537   |                           |      |   | 8,613   |  |   | 14,274  |   |  |   | 16,137 
|Operating income                                                |  |                             | 37,298  |                           |      |   | 75,238  |  |   | 93,444  |   |  |   | 135,598
|Net income (loss) attributable to common unitholders            |  |                             | (33,457 | )                         |      |   | 17,361  |  |   | (9,150  | ) |  |   | 20,073 
|Weighted average Common Units outstanding                       |  |                             | 214,015 |                           |      |   | 154,425 |  |   | 184,797 |   |  |   | 154,307
|Weighted average Common Units and potential dilutive securities |  |                             | 214,015 |                           |      |   | 154,624 |  |   | 184,797 |   |  |   | 154,477
|Basic income (loss) per Common Unit:                            |  |                             |         |                           |      |   |         |  |   |         |   |  |   |        
|Continuing operations                                           |  | $                           | (.15    | )                         |      | $ | .05     |  | $ | (.08    | ) |  | $ | .04    
|Discontinued operations                                         |  | $                           | (.01    | )                         |      | $ | .06     |  | $ | .03     |   |  | $ | .08    
|Diluted income (loss) per Common Unit:                          |  |                             |         |                           |      |   |         |  |   |         |   |  |   |        
|Continuing operations                                           |  | $                           | (.15    | )                         |      | $ | .05     |  | $ | (.08    | ) |  | $ | .04    
|Discontinued operations                                         |  | $                           | (.01    | )                         |      | $ | .06     |  | $ | .03     |   |  | $ | .08    
|Number of in-service consolidated properties at end of period   |  |                             | 541     |                           |      |   | 530     |  |   | 541     |   |  |   | 530    
|In-service consolidated square footage at end of period         |  |                             | 90,881  |                           |      |   | 88,068  |  |   | 90,881  |   |  |   | 88,068 
|Number of in-service joint venture properties at end of period  |  |                             | 207     |                           |      |   | 199     |  |   | 207     |   |  |   | 199    
|In-service joint venture square footage at end of period        |  |                             | 41,637  |                           |      |   | 36,548  |  |   | 41,637  |   |  |   | 36,548 



- 21 -



---

##### Table of Contents

Comparison of Three Months Ended June 30, 2009 to Three Months Ended June 30, 2008

Rental and Related Revenue

Overall, rental and related revenue from
continuing operations increased from $211.6 million for the quarter ended June 30, 2008 to $225.0 million for the same period in 2009. The following table sets forth rental and related revenue from continuing operations by reportable segment
for the three months ended June 30, 2009 and 2008, respectively (in thousands):



|                            |  |      |         |      |   |        
|--------------------------- |  | ---- | ------- | ---- | - | -------
|                            |  | 2009 |         | 2008
|Rental and Related Revenue: |  |      |         |      |   |        
|Office                      |  | $    | 142,314 |      | $ | 136,814
|Industrial                  |  |      | 65,621  |      |   | 60,784 
|Non-reportable segments     |  |      | 17,052  |      |   | 14,015 
|                            |  |      |         |      |   |        
|Total                       |  | $    | 224,987 |      | $ | 211,613
|                            |  |      |         |      |   |        

The following factors contributed to these results:



| |  |  | We acquired or consolidated nine properties and placed 43 developments in service from January 1, 2008 to June 30, 2009 that provided incremental revenues
of $16.5 million in the second quarter of 2009, as compared to the same period in 2008.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Lease termination fees, to the extent they are included in rental revenue from continuing operations, increased from $2.5 million in the second quarter of 2008 to
approximately $4.2 million in the second quarter of 2009.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The above increases were partially offset by an increase in our reserves for doubtful receivables as a result of the current economic conditions.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------

Rental Expenses and Real Estate Taxes

The following table sets forth rental expenses and real estate taxes by reportable segment for the three months ended June 30, 2009 and 2008, respectively (in thousands):



|                        |  |      |        |      |   |       
|----------------------- |  | ---- | ------ | ---- | - | ------
|                        |  | 2009 |        | 2008
|Rental Expenses:        |  |      |        |      |   |       
|Office                  |  | $    | 37,525 |      | $ | 35,491
|Industrial              |  |      | 6,186  |      |   | 6,275 
|Non-reportable segments |  |      | 5,305  |      |   | 3,151 
|                        |  |      |        |      |   |       
|Total                   |  | $    | 49,016 |      | $ | 44,917
|                        |  |      |        |      |   |       
|                        |  |     
|Real Estate Taxes:      |  |      |        |      |   |       
|Office                  |  | $    | 19,518 |      | $ | 17,318
|Industrial              |  |      | 9,062  |      |   | 7,509 
|Non-reportable segments |  |      | 1,366  |      |   | 979   
|                        |  |      |        |      |   |       
|Total                   |  | $    | 29,946 |      | $ | 25,806
|                        |  |      |        |      |   |       

Overall, rental expenses increased by $4.1 million in the second quarter of 2009, compared to the same period in
2008. The increase was primarily driven by $3.0 million of incremental costs associated with properties acquired or consolidated and developments placed in service from January 1, 2008 to June 30, 2009.

Of the overall $4.1 million increase in real estate taxes in the second quarter of 2009, compared to the same period in 2008, $1.7 million was attributable to properties
acquired or consolidated and developments placed in service from January 1, 2008 to June 30, 2009. The remaining increase was driven by increases in taxes on our existing properties.



- 22 -



---

##### Table of Contents

Service Operations

The following table sets forth the components of the Service Operations reportable segment for the three months ended June 30, 2009 and 2008, respectively (in thousands):



|                                                             |  |      |          |   |      |   |         |  
|------------------------------------------------------------ |  | ---- | -------- | - | ---- | - | ------- | -
|                                                             |  | 2009 |          |   | 2008 |  
|Service Operations:                                          |  |      |          |   |      |   |         |  
|General contractor revenue                                   |  | $    | 119,705  |   |      | $ | 85,635  |  
|General contractor costs                                     |  |      | (111,212 | ) |      |   | (81,248 | )
|                                                             |  |      |          |   |      |   |         |  
|Net general contractor revenue                               |  |      | 8,493    |   |      |   | 4,387   |  
|Service fee revenue                                          |  |      | 7,537    |   |      |   | 8,613   |  
|Service Operations general expenses                          |  |      | (7,063   | ) |      |   | (7,368  | )
|Gain on disposition of Build-for-Sale properties, net of tax |  |      |         |   |      |   | 4,758   |  
|                                                             |  |      |          |   |      |   |         |  
|Total                                                        |  | $    | 8,967    |   |      | $ | 10,390  |  
|                                                             |  |      |          |   |      |   |         |  

Service Operations primarily consist of the leasing, management, construction management, general contractor and
development services for joint venture properties and properties owned by third parties, as well as sales of Build-for-Sale properties. These operations are heavily influenced by the current state of the economy, as leasing and property management
fees are dependent upon occupancy while construction and development services rely on the expansion of business operations of third-party property owners. Earnings from Service Operations decreased from $10.4 million for the three months ended
June 30, 2008 to $9.0 million for the three months ended June 30, 2009. The decrease was primarily a result of gains on the sale of two properties totaling $4.8 million net of tax for the three months ended June 30, 2008 compared to
no net gain on sale of Build-for-Sale properties in the same period in 2009. This was somewhat offset by an increase in net general contractor revenues in the second quarter of 2009 compared to the same period in 2008.

Depreciation and Amortization

Depreciation and amortization expense
increased from $75.5 million during the second quarter of 2008 to $86.7 million for the same period in 2009 primarily due to increases in our held-for-rental asset base from properties acquired or consolidated and developments placed in service
during 2008 and 2009.

Equity in Earnings of Unconsolidated Companies

Equity in earnings represents our ownership share of net income from investments in unconsolidated companies that generally own and operate rental properties and develop properties for sale. These earnings decreased
from $6.9 million in the three months ended June 30, 2008 to $2.5 million for the same period in 2009. In April 2009, we consolidated two of our retail joint ventures as the result of obtaining control of those ventures, resulting in a decrease
of $1.2 million in equity in earnings for the three months ended June 30, 2009 compared to the same period in 2008. Equity in earnings also decreased because of our share of the gain on sale of a property from an unconsolidated subsidiary in
the second quarter of 2008 totaling $851,000, compared to no such sales in the three months ended June 30, 2009. The remaining decrease in equity in earnings is primarily the result of a decrease in occupancy in various properties within
certain of our joint ventures.



- 23 -



---

##### Table of Contents

Impairment Charges

Impairment charges classified in continuing operations consist of impairment recorded on our long-lived assets and investments as well as the write-off of previously capitalized costs of potential projects that we determined are no longer
likely to be pursued. The increase from $2.0 million in the second quarter of 2008 to $17.1 million in the second quarter of 2009 is primarily due to the following activity:



| |  |  | We recognized $4.6 million of non-cash impairment charges on certain parcels of undeveloped land that were either sold in the second quarter of 2009 or identified
as probable sales in the near future.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We recognized $6.2 million of non-cash impairment charges on five office and industrial buildings, four of which were sold in the second quarter of 2009 and one
that we intend to contribute to an unconsolidated joint venture later in 2009. The buildings sold were not included in discontinued operations because of our continuing involvement, either through a noncontrolling equity interest or a property
management agreement.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In June 2009 we recognized a $5.8 million charge on our investment in an unconsolidated joint venture.
| | - |  | ------------------------------------------------------------------------------------------------------

The remaining activity in the second quarter of 2009, as well as the $2.0 million of activity in the second quarter of 2008, primarily pertained to costs previously
capitalized for potential projects that we later determined would not be pursued.

General and Administrative Expense

General and administrative expenses increased from $6.9 million for the three months ended June 30, 2008 to $13.6 million for the same period in 2009. General and
administrative expenses consist of two components. The first component is direct expenses that are not attributable to specific assets such as legal fees, audit fees, marketing costs, investor relations expenses and other corporate overhead. The
second component is the unallocated indirect costs determined to be unrelated to the operation of our owned properties and Service Operations. Those indirect costs not allocated to these operations are charged to general and administrative expenses.
The increase in general and administrative expenses was primarily due to an increase in stock-based compensation expense of $3.2 million as the result of a component of the annual 2009 stock-based compensation grant being approved in the second
quarter of 2009, while the entire 2008 grant was approved in the first quarter of 2008. Also contributing to the increase was a $2.1 million increase in severance pay in the second quarter of 2009 as compared to the same period in 2008. Other than
these two unusual expense items, we reduced our total direct and indirect costs by $7.1 million to compensate for a reduction in the volume of leasing and construction activity. Actual overhead costs allocated to leasing and construction decreased
by $8.4 million, which, when netted with the $7.1 million savings, resulted in the remaining increase in general and administrative expenses.

Interest
Expense

Interest expense increased from $47.8 million in the second quarter of 2008 to $52.0 million in the second quarter of 2009. This increase was
primarily the result of an increase of $3.1 million in interest expense on secured debt, largely driven by the $156.0 million secured financings that we completed in February and March 2009.



- 24 -



---

##### Table of Contents

During the first six months of 2009, we repurchased certain of our outstanding series of our unsecured notes, including
our 3.75% Exchangeable Senior Notes (the Exchangeable Notes) with a face value of $132.9 million. In addition, in the second quarter of 2009, we paid down a substantial portion of the LIBOR-based Duke Realty Limited Partnership
(DRLP) unsecured line of credit with proceeds from the April 2009 common stock offering. These factors, along with a decrease in LIBOR rates, resulted in a $7.1 million decrease in unsecured interest costs; however, the resultant
interest savings were more than offset by a $7.3 million decrease in capitalization of interest costs due to less development activity in 2009.

Discontinued Operations

The results of operations for properties sold during the year to unrelated parties or classified as held-for-sale
at the end of the period are required to be classified as discontinued operations. The property specific components of earnings that are classified as discontinued operations include rental revenues, rental expenses, real estate taxes, allocated
interest expense and depreciation expense, as well as the net gain or loss on the disposition of properties.

The operations of eleven buildings are
classified as discontinued operations for the three months ended June 30, 2009 and June 30, 2008. These eleven buildings consist of four industrial and seven office properties. As a result, we classified losses, before impairment charges
and gain on sales, of $(103,000) and $(159,000) in discontinued operations for the three months ended June 30, 2009 and 2008, respectively.

Of these
properties, one was sold during the second quarter of 2009 and four were sold during the second quarter of 2008. An impairment charge of $(772,000) was recognized on the property sold in the second quarter of 2009 and is reported in discontinued
operations. The gains on disposal of $9.5 million for the three months ended June 30, 2008 are also reported in discontinued operations.

Comparison of Six Months Ended June 30, 2009 to Six Months Ended June 30, 2008

Rental and Related Revenue

Overall, rental and related revenue from continuing operations increased from $423.2 million for the six months ended June 30, 2008 to $445.7
million for the same period in 2009. The following table reconciles rental and related revenue from continuing operations by reportable segment to our total reported rental and related revenue from continuing operations for the six months ended
June 30, 2009 and 2008, respectively (in thousands):



|                            |  |      |         |      |   |        
|--------------------------- |  | ---- | ------- | ---- | - | -------
|                            |  | 2009 |         | 2008
|Rental and Related Revenue: |  |      |         |      |   |        
|Office                      |  | $    | 285,403 |      | $ | 276,476
|Industrial                  |  |      | 130,799 |      |   | 121,835
|Non-reportable segments     |  |      | 29,498  |      |   | 24,937 
|                            |  |      |         |      |   |        
|Total                       |  | $    | 445,700 |      | $ | 423,248
|                            |  |      |         |      |   |        

The following factors contributed to these results:



| |  |  | We acquired or consolidated nine properties and placed 43 developments in service from January 1, 2008 to June 30, 2009 that provided incremental revenues
of $28.3 million for the first six months of 2009, as compared to the same period in 2008.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Lease termination fees, to the extent they are included in rental revenue from continuing operations, decreased from $5.0 million for the six months ended
June 30, 2008 to $4.5 million for the same period in 2009.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The increase in rental revenues from acquired or developed properties was also offset by an increase in our reserves for doubtful receivables as a result of the
current economic conditions.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



- 25 -



---

##### Table of Contents

Rental Expenses and Real Estate Taxes

The following table reconciles rental expenses and real estate taxes by reportable segment to our total reported amounts in the statement of operations for the six months ended June 30, 2009 and 2008,
respectively (in thousands):



|                        |  |      |         |      |   |       
|----------------------- |  | ---- | ------- | ---- | - | ------
|                        |  | 2009 |         | 2008
|Rental Expenses:        |  |      |         |      |   |       
|Office                  |  | $    | 80,227  |      | $ | 75,276
|Industrial              |  |      | 14,501  |      |   | 14,428
|Non-reportable segments |  |      | 8,432   |      |   | 5,449 
|                        |  |      |         |      |   |       
|Total                   |  | $    | 103,160 |      | $ | 95,153
|                        |  |      |         |      |   |       
|                        |  |     
|Real Estate Taxes:      |  |      |         |      |   |       
|Office                  |  | $    | 38,733  |      | $ | 34,276
|Industrial              |  |      | 17,936  |      |   | 15,218
|Non-reportable segments |  |      | 2,416   |      |   | 1,768 
|                        |  |      |         |      |   |       
|Total                   |  | $    | 59,085  |      | $ | 51,262
|                        |  |      |         |      |   |       

Of the overall $8.0 million increase in rental expenses in the first six months of 2009, compared to the same
period in 2008, $5.0 million was attributable to properties acquired and developments placed in service from January 1, 2008 to June 30, 2009.

Of the overall $7.8 million increase in real estate taxes in the first six months of 2009, compared to the same period in 2008, $3.0 million was attributable to properties acquired and developments placed in service from January 1,
2008 to June 30, 2009. The remaining increase in real estate taxes was driven by tax increases in our existing base of properties throughout our different markets.

Service Operations

The following table sets forth the components of the Service Operations reportable segment for
the six months ended June 30, 2009 and 2008, respectively (in thousands):



|                                                             |  |      |          |   |      |   |          |  
|------------------------------------------------------------ |  | ---- | -------- | - | ---- | - | -------- | -
|                                                             |  | 2009 |          |   | 2008 |  
|Service Operations:                                          |  |      |          |   |      |   |          |  
|General contractor revenue                                   |  | $    | 218,062  |   |      | $ | 162,394  |  
|General contractor costs                                     |  |      | (202,615 | ) |      |   | (154,421 | )
|                                                             |  |      |          |   |      |   |          |  
|Net general contractor revenue                               |  |      | 15,447   |   |      |   | 7,973    |  
|Service fee revenue                                          |  |      | 14,274   |   |      |   | 16,137   |  
|Service Operations general expenses                          |  |      | (12,406  | ) |      |   | (14,437  | )
|Gain on disposition of Build-for-Sale properties, net of tax |  |      |         |   |      |   | 5,130    |  
|                                                             |  |      |          |   |      |   |          |  
|Total                                                        |  | $    | 17,315   |   |      | $ | 14,803   |  
|                                                             |  |      |          |   |      |   |          |  

Earnings from Service Operations increased from $14.8 million for the six months ended June 30, 2008 to $17.3
million for the six months ended June 30, 2009. The increase was primarily due to net general contractor revenue being lower than usual in the first six months of 2008 as a result of increases in our total cost estimates for two third-party
fixed price construction contracts, which reduced the margins on the contracts. This increase was somewhat offset by gains on the sale of two properties totaling $5.1 million net of tax for the six months ended June 30, 2008 compared to no net
gain on sale of Build-for-Sale properties in the same period in 2009.

Depreciation and Amortization

Depreciation and amortization expense increased from $151.1 million for the first half of 2008 to $166.7 million for the same period in 2009 primarily due to increases in
our held-for-rental asset base from properties acquired or consolidated and developments placed in service during 2008 and 2009.



- 26 -



---

##### Table of Contents

Equity in Earnings

Equity in earnings decreased from $17.0 million in the six months ended June 30, 2008 to $5.0 million for the same period in 2009. In April 2009, we consolidated two of our retail joint ventures as the result of obtaining control of
those ventures, resulting in a decrease of $2.3 million in equity in earnings for the six months ended June 30, 2009 compared to the same period in 2008. Equity in earnings also decreased because of our share of the gain on sale of two
properties from unconsolidated subsidiaries in the first six months of 2008 totaling $5.1 million, compared to no such sales in the same period in 2009. The remaining decrease in equity in earnings is primarily the result of a decrease in occupancy
in various properties within certain of our joint ventures.

Impairment Charges

Impairment charges classified in continuing operations consist of impairment recorded on our long-lived assets and investments as well as the write-off of previously capitalized costs of potential projects that we
determined are no longer likely to be pursued. The increase from $2.8 million in the six months ended June 30, 2008 to $17.5 million in the same period in 2009 is primarily due to the following activity:



| |  |  | We recognized $4.6 million of non-cash impairment charges on certain parcels of undeveloped land that were either sold in the second quarter of 2009 or identified
as probable sales in the near future.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We recognized $6.2 million of non-cash impairment charges on five office and industrial buildings, four of which were sold in the second quarter of 2009 and one
that we intend to contribute to an unconsolidated joint venture later in 2009. The buildings sold were not included in discontinued operations because of our continuing involvement, either through a noncontrolling equity interest or a property
management agreement.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In June 2009 we recognized a $5.8 million charge on our investment in an unconsolidated joint venture.
| | - |  | ------------------------------------------------------------------------------------------------------

The remaining activity in the six months ended June 30, 2009, as well as the $2.8 million of activity in the six months ended June 30, 2008, primarily
pertained to costs previously capitalized for potential projects that we later determined would not be pursued.

General and Administrative Expense

General and administrative expenses increased from $19.1 million for the six months ended June 30, 2008 to $23.5 million for the same period in 2009.
The increase in general and administrative expenses from the six months ended June 30, 2008 is primarily the result of a $3.3 million increase in severance pay. Other than this unusual expense item, we reduced our total direct and indirect
costs by $14.4 million to compensate for a reduction in the volume of leasing and construction activity. Actual overhead costs allocated to leasing and construction decreased by $15.5 million, which, when netted with the $14.4 million savings,
resulted in the remaining increase in general and administrative expenses.

Interest Expense

Interest expense increased from $95.9 million for the six months ended June 30, 2008 to $104.1 million for the same period in 2009. This increase is primarily the
result of an increase of $3.9 million in interest expense on secured debt, largely driven by the $156.0 million secured financings that we had in February and March 2009.



- 27 -



---

##### Table of Contents

During 2009, we repurchased certain of our outstanding series of our unsecured notes, including Exchangeable Notes with a
face value of $132.9 million. In addition, in the second quarter of 2009, we paid down a substantial portion of the LIBOR-based DRLP unsecured line of credit with proceeds from the April 2009 common stock offering. These factors, along with a
decrease in LIBOR rates, resulted in an $11.7 million decrease in unsecured interest costs; however, the resulting interest savings were more than offset by a decrease of $14.3 million in capitalization of interest costs due to less development
activity in 2009.

Gain on Extinguishment of Debt

During the first six months of 2009, we repurchased certain of our outstanding series of unsecured notes scheduled to mature in 2009 through 2011. The majority of our debt repurchases during this period consisted of our Exchangeable Notes.
In total, we repurchased unsecured notes that had a face value of $191.0 million for $150.0 million, recognizing a net gain on extinguishment of approximately $34.5 million after considering the write-off of unamortized deferred financing costs and
discounts.

Discontinued Operations

The operations of
eleven buildings are currently classified as discontinued operations for the six months ended June 30, 2009 and June 30, 2008. These eleven buildings consist of four industrial and seven office properties. As a result, we classified
income, before impairment charges and gain on sales, of $82,000 and $2.6 million in discontinued operations for the six months ended June 30, 2009 and 2008, respectively.

Of these properties, three were sold during the first six months of 2009 and five were sold during the first six months of 2008. The gains on disposal of these properties of $5.2 million and $10.6 million for the six
months ended June 30, 2009 and 2008, respectively, are also reported in discontinued operations, as well as an impairment charge of $(772,000) recognized on one of the three properties sold in the first six months of 2009.

Liquidity and Capital Resources

Sources of Liquidity

We expect to meet our short-term liquidity requirements over the next twelve months, including payments of distributions, as well as recurring capital
expenditures needed to maintain our current real estate assets, primarily through working capital, net cash provided by operating activities, proceeds received from real estate dispositions and proceeds from secured debt financings.

We expect to meet long-term liquidity requirements, such as scheduled mortgage and unsecured debt maturities, property acquisitions, financing of development activities
and other non-recurring capital improvements, primarily through the following sources:



| |  |  | undistributed cash provided by operating activities;
| | - |  | ----------------------------------------------------



| |  |  | issuance of additional equity, including General Partner common and preferred shares;
| | - |  | -------------------------------------------------------------------------------------



| |  |  | issuance of additional secured and unsecured debt;
| | - |  | --------------------------------------------------



| |  |  | proceeds received from real estate dispositions; and
| | - |  | ----------------------------------------------------



| |  |  | transactions with unconsolidated entities.
| | - |  | ------------------------------------------



- 28 -



---

##### Table of Contents

We are constantly monitoring the state of the capital markets and actively managing our capital needs, such as
development expenditures and commitments. We will continue to utilize the Partnerships $1.3 billion unsecured revolving line of credit, of which only $78.0 million was outstanding as of June 30, 2009, to complete development projects
currently under construction. We have substantially reduced our level of new development activity and are focused on the completion and lease-up of under construction and recently completed projects. In addition, we anticipate using multiple sources
of capital, including secured debt financings in the near future, to meet our long-term capital needs.

In April 2009, the General Partner received $551.9
million of net proceeds from the issuance of approximately 72.5 million shares of its common stock. The net proceeds from the offering were contributed to us by the General Partner for an additional interest in the Partnership and then used to
repay outstanding borrowings under the Partnerships $1.3 billion unsecured revolving line of credit as well as for general corporate purposes.

In
August 2009, we issued $250.0 million of senior unsecured notes due in 2015 bearing interest at 7.375% and $250.0 million of senior unsecured notes due in 2019 bearing interest at 8.25%.

Rental Operations

We believe our principal source of liquidity, cash flows from Rental Operations, provides a
stable source of cash to fund operational expenses. We believe that this cash-based revenue stream is substantially aligned with revenue recognition (except for periodic straight-line rental income accruals and amortization of above or below market
rents) as cash receipts from the leasing of rental properties are generally received in advance of or a short time following the actual revenue recognition.

We are subject to a number of risks as a result of the current economic downturn, including reduced occupancy, tenant defaults and bankruptcies, and potential reduction in rental rates upon renewal or re-letting of properties, each of which
would result in reduced cash flow from operations. These risks may be heightened as a result of the current economic conditions. In the first six months of 2009, we recognized $3.8 million of expense related to reserving doubtful receivables
compared to $733,000 in the first six months of 2008.

Secured Debt Financing

We intend to use a portion of our 454 in-service unencumbered properties as of June 30, 2009 as a source of collateral for future secured financings. We are currently in various stages of negotiation with
multiple lenders for additional secured debt financings. We expect secured debt to be a significant component, relative to other sources, of the additional liquidity we generate in the near term.

Unsecured Debt and Equity Securities

We use the
Partnerships unsecured line of credit to fund development activities, acquire additional rental properties and provide working capital.

The
indentures (and related supplemental indentures) governing our outstanding series of unsecured notes require us to comply with financial ratios and other covenants regarding our operations. We were in compliance with all such covenants, as well as
applicable covenants under our unsecured line of credit, as of June 30, 2009.

On July 31, 2009, we and the General Partner filed with the SEC an
automatic shelf registration statement on Form S-3, relating to the offer and sale, from time to time, of an indeterminate amount of debt and equity securities, as well as guarantees of our debt securities by the General Partner. Equity securities
are offered and sold by the General Partner and the net proceeds of such offerings are contributed to us in exchange for additional General Partner Units or Preferred Units. From time to time, we and the General Partner expect to issue additional
securities under this automatic shelf registration statement to fund the repayment of the Partnerships unsecured line of credit and other long-term debt upon maturity.



- 29 -



---

##### Table of Contents

Sale of Real Estate Assets

We pursue opportunities to sell non-strategic real estate assets in order to generate additional liquidity. Our ability to dispose of such properties is dependent on the availability of credit to potential buyers. In
light of recent market and economic conditions, including, without limitation, the availability and cost of credit, the U.S. mortgage market, and declining equity and real estate markets, we may be unable to dispose of such properties quickly, if at
all, or on favorable terms.

Transactions with Unconsolidated Entities

Transactions with unconsolidated partnerships and joint ventures also provide a source of liquidity. From time to time we will sell properties to an unconsolidated entity, while retaining a continuing interest in that
entity, and receive proceeds commensurate to the interest that we do not own. Additionally, unconsolidated entities will from time to time obtain debt financing and will distribute to us, and our partners, all or a portion of the proceeds.

We have a 20% equity interest in an unconsolidated joint venture that will acquire up to $800.0 million of our newly developed build-to-suit projects over
a three-year period from its formation in May 2008. Properties are sold to the joint venture upon completion, lease commencement and satisfaction of other customary conditions. During the six months ended June 30, 2009, the joint venture
acquired three properties from us and we received net proceeds, commensurate to our partners ownership interest, of approximately $31.9 million.

Uses of Liquidity

Our principal uses of liquidity include the following:



| |  |  | property investment;
| | - |  | --------------------



| |  |  | recurring leasing/capital costs;
| | - |  | --------------------------------



| |  |  | distributions to unitholders;
| | - |  | -----------------------------



| |  |  | long-term debt maturities;
| | - |  | --------------------------



| |  |  | opportunistic repurchases of outstanding debt; and
| | - |  | --------------------------------------------------



| |  |  | other contractual obligations.
| | - |  | ------------------------------

Property
Investment

We evaluate development and acquisition opportunities based upon market outlook, supply and long-term growth potential. Our ability to
make future property investments is dependent upon our continued access to our longer-term sources of liquidity including the issuances of debt or equity securities as well as disposing of selected properties. In light of current economic
conditions, management continues to evaluate our investment priorities and to limit new development expenditures.

Recurring Expenditures

One of the principal uses of our liquidity is to fund the recurring leasing/capital expenditures of our real estate investments. The following is a summary
of our recurring capital expenditures for the six months ended June 30, 2009 and 2008, respectively (in thousands):



|                              |  |      |        |      |   |       
|----------------------------- |  | ---- | ------ | ---- | - | ------
|                              |  | 2009 |        | 2008
|Recurring tenant improvements |  | $    | 16,047 |      | $ | 18,734
|Recurring leasing costs       |  |      | 17,761 |      |   | 10,600
|Building improvements         |  |      | 2,901  |      |   | 2,670 
|                              |  |      |        |      |   |       
|Totals                        |  | $    | 36,709 |      | $ | 32,004
|                              |  |      |        |      |   |       



- 30 -



---

##### Table of Contents

Distribution Requirements

The General Partner is required to meet the distribution requirements of the Internal Revenue Code of 1986, as amended (the Code), in order to maintain its REIT status. Because depreciation is a non-cash
expense, cash flow will typically be greater than operating income. We paid distributions of $0.25 per Common Unit in the first quarter of 2009 and $0.17 per Common Unit, after considering the additional issuance of equity in April 2009, in the
second quarter of 2009. The General Partners board of directors declared distributions of $0.17 per Common Unit for the third quarter of 2009. Our future distributions will be declared at the discretion of the General Partners board of
directors and will be subject to our future capital needs and availability.

At June 30, 2009, the General Partner had six series of preferred shares
outstanding. The annual distribution rates on the General Partners preferred shares range between 6.5% and 8.375% and are paid in arrears quarterly.

Debt Maturities

Debt outstanding at June 30, 2009 had a face value totaling $3.8 billion with a weighted average interest rate
of 5.92% maturing at various dates through 2028. We had $3.0 billion of unsecured debt, $92.9 million outstanding on our unsecured lines of credit and $665.0 million of secured debt outstanding at June 30, 2009. Scheduled principal
amortization, repurchases and maturities of such debt totaled $316.0 million for the six months ended June 30, 2009.

The following is a summary of
the scheduled future amortization and maturities of our indebtedness at June 30, 2009 (in thousands, except percentage data):



|                  |  |                       |         |                                                   |   |           |  |   |           |  |      |  
|----------------- |  | --------------------- | ------- | ------------------------------------------------- | - | --------- |  | - | --------- |  | ---- | -
|                  |  | Future Repayments     |         | Weighted AverageInterest Rate ofFuture Repayments |  
|Year              |  | ScheduledAmortization |         | Maturities (1)                                    |   | Total     | 
|Remainder of 2009 |  | $                     | 5,836   |                                                   | $ | 121,440   |  | $ | 127,276   |  | 7.79 | %
|2010              |  |                       | 11,460  |                                                   |   | 235,728   |  |   | 247,188   |  | 4.04 | %
|2011              |  |                       | 11,624  |                                                   |   | 865,375   |  |   | 876,999   |  | 5.14 | %
|2012              |  |                       | 9,772   |                                                   |   | 201,668   |  |   | 211,440   |  | 5.90 | %
|2013              |  |                       | 9,824   |                                                   |   | 475,000   |  |   | 484,824   |  | 6.50 | %
|2014              |  |                       | 10,119  |                                                   |   | 272,111   |  |   | 282,230   |  | 6.44 | %
|2015              |  |                       | 8,791   |                                                   |   |          |  |   | 8,791     |  | 6.27 | %
|2016              |  |                       | 7,999   |                                                   |   | 490,900   |  |   | 498,899   |  | 6.16 | %
|2017              |  |                       | 6,515   |                                                   |   | 469,324   |  |   | 475,839   |  | 5.94 | %
|2018              |  |                       | 4,679   |                                                   |   | 300,000   |  |   | 304,679   |  | 6.09 | %
|2019              |  |                       | 3,365   |                                                   |   | 154,438   |  |   | 157,803   |  | 7.54 | %
|Thereafter        |  |                       | 24,439  |                                                   |   | 50,000    |  |   | 74,439    |  | 6.83 | %
|                  |  |                       |         |                                                   |   |           |  |   |           |  |      |  
|                  |  | $                     | 114,423 |                                                   | $ | 3,635,984 |  | $ | 3,750,407 |  | 5.92 | %
|                  |  |                       |         |                                                   |   |           |  |   |           |  |      |  



|(1) | The balance outstanding on the Partnerships unsecured line of credit is included in debt maturities for 2010. This line of credit may be extended to 2011 at our option.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

We anticipate generating capital to fund our debt maturities by using undistributed cash generated from rental operations, which will
increase as the result of reducing our annual distributions and development expenditures, as well as by raising additional capital which, in the near term, is expected to occur mainly through secured debt financings and asset dispositions.



- 31 -



---

##### Table of Contents

Historical Cash Flows

Cash and cash equivalents were $26.7 million and $17.9 million at June 30, 2009 and 2008, respectively. The following highlights significant changes in net cash associated with our operating, investing and financing activities (in
millions):



|                                                    |  |                           |        |   |      |   |        |  
|--------------------------------------------------- |  | ------------------------- | ------ | - | ---- | - | ------ | -
|                                                    |  | Six Months Ended June 30, |       
|                                                    |  | 2009                      |        |   | 2008 |  
|Net Cash Provided byOperating Activities            |  | $                         | 188.2  |   |      | $ | 119.3  |  
|                                                    |  |                          
|Net Cash (Used for)Investing Activities             |  | $                         | (114.8 | ) |      | $ | (255.7 | )
|                                                    |  |                          
|Net Cash Provided by (Used for)Financing Activities |  | $                         | (69.0  | ) |      | $ | 107.2  |  

Operating Activities

The receipt of rental income from Rental Operations continues to provide the primary source of our revenues and operating cash flows. In addition, we have historically developed Build-for-Sale properties with the
intent to sell them at or soon after completion. We have ceased new Build-for-Sale development activity to focus on completion of projects that were started in 2008 and have virtually halted all new development activity pending improvements in the
economy and capital markets. Build-for-Sale development activity has historically represented a significant use of operating cash, while the proceeds from related sales provided another source of operating cash flow activity.



| |  |  | During the six-month period ended June 30, 2009 we incurred Build-for-Sale property development costs of $16.4 million, compared to $108.8 million for the same
period ended June 30, 2008. The difference is reflective of the planned reduction in new development.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We sold three Build-for-Sale properties in the first six months of 2009, compared to two such properties sold in the same period in 2008, receiving net proceeds of
$31.9 million and $50.8 million, respectively. We recognized an impairment charge on these properties, net of tax, of $229,000 in the first six months of 2009, compared to a $5.1 million gain, net of tax, on the properties sold in the same period in
2008.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Investing Activities

Investing activities are one of the primary uses of our liquidity. Development and acquisition activities typically generate additional rental revenues and provide cash flows for operational requirements. Highlights of significant cash
sources and uses are as follows:



| |  |  | Held-for-rental development costs decreased to $149.2 million for the six-month period ended June 30, 2009 from $268.2 million for the same period in 2008
largely as the result of the planned reduction in new development.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | During the first six months of 2009, we paid cash of $16.6 million for real estate acquisitions and $5.5 million for undeveloped land acquisitions, compared to
$11.3 million for real estate acquisitions and $18.0 million for acquisitions of undeveloped land in the same period in 2008. All of the real estate acquired in both periods consisted of industrial properties in our Savannah, Georgia market.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Sales of land and depreciated property provided $100.2 million in net proceeds for the six-month period ended June 30, 2009 compared to $69.3 million for the
same period in 2008.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We received capital distributions (as a result of the sale of properties or refinancing) of $45.7 million from unconsolidated companies for the six-month period
ended June 30, 2008. We received no capital distributions from unconsolidated companies during the first six months of 2009.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



- 32 -



---

##### Table of Contents

Financing Activities

The following items highlight major fluctuations in net cash flow related to financing activities in the first six months of 2009 compared to the same period in 2008:



| |  |  | In February 2009, we repaid $124.0 million of corporate unsecured debt with an effective interest rate of 6.83% on its scheduled maturity date. This compares to
repayments of $125.0 million and $100.0 million of senior unsecured notes with effective interest rates of 3.36% and 6.76% on their scheduled maturity dates in January 2008 and May 2008, respectively.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Throughout the first six months of 2009, we repurchased certain of our outstanding series of unsecured notes maturing in 2009 through 2011, including Exchangeable
Notes with a face value of $132.9 million. In total, cash payments of $150.0 million were made to repurchase notes with a face value of $191.0 million.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In February and March 2009, we received cash proceeds of $156.0 million from two 10-year secured debt financings that are secured by 22 existing rental properties.
The secured debt bears a weighted average interest rate of 7.6% and matures in 2019.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In April 2009, the General Partner issued 75.2 million shares of its common stock for net proceeds of $551.9 million. The proceeds from this offering were
contributed to us in exchange for an additional interest in the Partnership and were used to repay outstanding borrowings under the Partnerships unsecured line of credit and for other general purposes.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In order to retain additional cash to help meet our capital needs, we reduced our quarterly distribution beginning in the first quarter of 2009. We paid cash
distributions of $0.25 and $0.17 per Common Unit in February and May 2009, respectively, compared to cash distributions of $0.48 per Common Unit in both February and May 2008. The reduction in the cash distributions per unit from $0.25 per Common
Unit to $0.17 per Common Unit was necessary, as the result of the issuance of additional General Partner Units for the General Partners April 2009 common stock offering, for us to maintain our planned level of aggregate distributions for 2009.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We decreased net borrowings on the Partnerships $1.3 billion line of credit by $396.0 million for the six months ended June 30, 2009 compared to a
decrease of $56.0 million for the same period in 2008.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In February 2008, we received net proceeds of approximately $290.1 million from the General Partners issuance of shares of its Series O Cumulative Redeemable
Preferred Stock; we had no new preferred equity issuances in the same period in 2009.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In March 2008, we settled three forward-starting swaps and made a cash payment of $14.6 million to the counterparties.
| | - |  | ----------------------------------------------------------------------------------------------------------------------



| |  |  | In May 2008, we issued $325.0 million of senior unsecured notes due in May 2013 with an effective interest rate of 7.36%.
| | - |  | -------------------------------------------------------------------------------------------------------------------------

Contractual Obligations

Aside from changes in long-term debt,
there have not been material changes in our outstanding commitments since December 31, 2008 as previously discussed in our 2008 Annual Report on Form 10-K. In most cases we may withdraw from land purchase contracts with the sellers only
recourse being earnest money deposits already made.



- 33 -



---

##### Table of Contents

Off Balance Sheet ArrangementsInvestments in Unconsolidated Companies

We analyze our investments in joint ventures under Financial Accounting Standards Board (FASB) Interpretation No. 46(R), Consolidation of Variable
Interest Entities (FIN 46(R)),to determine if the joint venture is a variable interest entity (a VIE, as defined by FIN 46(R)) and would require consolidation. To the extent that our joint ventures do not qualify
as VIEs, we further assess under the guidelines of Emerging Issues Task Force (EITF) No. 04-5, Determining Whether a General Partner, or the General Partners as a Group, Controls a Limited Partnership or Similar Entity when the
Limited Partners Have Certain Rights (EITF 04-5); Statement of Position 78-9, Accounting for Investments in Real Estate Ventures; Accounting Research Bulletin No. 51, Consolidated Financial Statements and SFAS
No. 94, Consolidation of All Majority-Owned Subsidiaries, to determine if the venture should be consolidated.

We have equity interests in
unconsolidated partnerships and joint ventures that own and operate rental properties and hold land for development. Our unconsolidated subsidiaries are primarily engaged in the operation and development of Industrial, Office and Retail real estate
properties. These investments provide us with increased market share and tenant and property diversification. The equity method of accounting is used for these investments in which we have the ability to exercise significant influence, but not
control, over operating and financial policies. As a result, the assets and liabilities of these joint ventures are not included on our balance sheet. Our investments in and advances to unconsolidated companies represented approximately 6% and 9% of
our total assets as of June 30, 2009 and December 31, 2008, respectively. Total assets of our unconsolidated subsidiaries were $2.5 billion and $2.6 billion as of June 30, 2009 and December 31, 2008. The combined revenues of our
unconsolidated subsidiaries totaled approximately $129.8 million and $121.0 million for the six-month periods ended June 30, 2009 and June 30, 2008, respectively.

We have guaranteed the repayment of certain secured and unsecured loans of our unconsolidated subsidiaries and the outstanding balances on the guaranteed portion of these loans was approximately $368.2 million at
June 30, 2009.

Recent Accounting Pronouncements

On January 1, 2009, we adopted FASB Staff Position No. 14-1, Accounting for Convertible Debt Instruments that may be Settled in Cash upon Conversion (Including Partial Cash Settlement) (FSP APB 14-1). FSP APB
14-1 requires separate accounting for the debt and equity components of certain convertible instruments. Our Exchangeable Notes issued in November 2006 have an exchange rate of 20.47 common shares per $1,000 principal amount of the notes,
representing an exchange price of $48.85 per share of the General Partners common stock. The Exchangeable Notes are subject to the accounting changes required by FSP APB 14-1. FSP APB 14-1 requires that the value assigned to the debt component
equal the estimated fair value of debt with similar contractual cash flows, but without the conversion feature, which results in the debt being recorded at a discount. The resulting debt discount will be amortized over the period from its issuance
through November 2011, the first optional redemption date, as additional non-cash interest expense.

At June 30, 2009, the Exchangeable Notes had
$442.2 million of principal outstanding, an unamortized discount of $13.9 million and a net carrying amount of $428.2 million. The carrying amount of the equity component was $34.7 million at June 30, 2009. Subsequent to the implementation of
FSP APB 14-1, interest expense is recognized on the Exchangeable Notes at an effective rate of 5.6%. The increase to interest expense (in thousands) on the Exchangeable Notes, which led to a corresponding decrease to net income, for the three and
six months ended June 30, 2009 and 2008 is summarized as follows:



|                                                                         |  |                            |       |                          |   |       |  |      |        |  |   |       
|------------------------------------------------------------------------ |  | -------------------------- | ----- | ------------------------ | - | ----- |  | ---- | ------ |  | - | ------
|                                                                         |  | Three Months EndedJune 30, |       | Six Months EndedJune 30,
|                                                                         |  | 2009                       |       | 2008                     |   | 2009  |  | 2008
|Interest expense on Exchangeable Notes, excluding effect of FSP APB 14-1 |  | $                          | 4,225 |                          | $ | 5,391 |  | $    | 9,132  |  | $ | 10,781
|                                                                         |  |                            |       |                         
|Effect of FSP ABP 14-1                                                   |  |                            | 1,356 |                          |   | 1,621 |  |      | 2,975  |  |   | 3,218 
|                                                                         |  |                            |       |                          |   |       |  |      |        |  |   |       
|                                                                         |  |                            |       |                         
|Total interest expense on Exchangeable Notes                             |  | $                          | 5,581 |                          | $ | 7,012 |  | $    | 12,107 |  | $ | 13,999
|                                                                         |  |                            |       |                          |   |       |  |      |        |  |   |       



- 34 -



---

##### Table of Contents

|Item 3. | Quantitative and Qualitative Disclosure About Market Risk
|------- | ---------------------------------------------------------

We are
exposed to interest rate changes primarily as a result of our line of credit and long-term debt borrowings. Our interest rate risk management objective is to limit the impact of interest rate changes on earnings and cash flows and to lower overall
borrowing costs. To achieve our objectives, we borrow primarily at fixed rates and may enter into derivative financial instruments such as interest rate swaps, caps and treasury locks in order to mitigate our interest rate risk on a related
financial instrument. We do not enter into derivative or interest rate transactions for speculative purposes. Our two outstanding swaps, which fixed the rates on two of our variable rate loans, were not significant to the Financial Statements in
terms of notional amount or fair value at June 30, 2009.

Our interest rate risk is monitored using a variety of techniques. The table below presents
the principal amounts (in thousands) of the expected annual maturities, weighted average interest rates for the average debt outstanding in the specified period, fair values (in thousands) and other terms required to evaluate the expected cash flows
and sensitivity to interest rate changes.



|                               |  |                  |         |   |      |   |         |      |  |   |         |   |  |      |         |   |            |   |         |       |  |           |           |   |  |   |           |  |   |          
|------------------------------ |  | ---------------- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | - |  | ---- | ------- | - | ---------- | - | ------- | ----- |  | --------- | --------- | - |  | - | --------- |  | - | ---------
|                               |  | Remainder of2009 |         |   | 2010 |   |         | 2011 |  |   | 2012    |   |  | 2013 |         |   | Thereafter |   |         | Total |  | FairValue
|Fixed rate secured debt        |  | $                | 5,126   |   |      | $ | 10,710  |      |  | $ | 22,979  |   |  | $    | 10,158  |   |            | $ | 8,944   |       |  | $         | 598,345   |   |  | $ | 656,262   |  | $ | 599,363  
|Weighted average interest rate |  |                  | 6.91    | % |      |   | 6.91    | %    |  |   | 7.16    | % |  |      | 6.76    | % |            |   | 6.61    | %     |  |           | 6.44      | % |  |   |           |  |   |          
|                               |  |                  |         |   |      |   |         |     
|Variable rate secured debt     |  | $                | 710     |   |      | $ | 750     |      |  | $ | 785     |   |  | $    | 1,282   |   |            | $ | 880     |       |  | $         | 4,335     |   |  | $ | 8,742     |  | $ | 8,742    
|Weighted average interest rate |  |                  | 3.48    | % |      |   | 3.48    | %    |  |   | 3.47    | % |  |      | 4.01    | % |            |   | 3.47    | %     |  |           | 3.53      | % |  |   |           |  |   |          
|                               |  |                  |         |   |      |   |         |     
|Fixed rate unsecured notes     |  | $                | 121,440 |   |      | $ | 157,728 |      |  | $ | 838,312 |   |  | $    | 200,000 |   |            | $ | 475,000 |       |  | $         | 1,200,000 |   |  | $ | 2,992,480 |  | $ | 2,348,465
|Weighted average interest rate |  |                  | 7.86    | % |      |   | 5.37    | %    |  |   | 5.15    | % |  |      | 5.87    | % |            |   | 6.50    | %     |  |           | 6.21      | % |  |   |           |  |   |          
|                               |  |                  |         |   |      |   |         |     
|Unsecured lines of credit      |  | $                |        |   |      | $ | 78,000  |      |  | $ | 14,923  |   |  | $    |        |   |            | $ |        |       |  | $         |          |   |  | $ | 92,923    |  | $ | 89,609   
|Rate at June 30, 2009          |  |                  | N/A     |   |      |   | 0.96    | %    |  |   | 1.16    | % |  |      | N/A     |   |            |   | N/A     |       |  |           | N/A       |   |  |   |           |  |   |          

As the table incorporates only those exposures that exist as of June 30, 2009, it does not consider those
exposures or positions that could arise after that date. As a result, our ultimate realized gain or loss with respect to interest rate fluctuations will depend on the exposures that arise during the period, our hedging strategies at that time to the
extent we are party to interest rate derivatives, and interest rates. Interest expense on our unsecured lines of credit will be affected by fluctuations in the LIBOR indices as well as changes in our credit rating. The interest rate at such point in
the future as we may renew, extend or replace our unsecured lines of credit will be heavily dependent upon the state of the credit environment.

At
December 31, 2008, the redemption value of our unsecured notes was $3.3 billion and we estimated the fair value of those unsecured notes to be $2.2 billion. Our unsecured notes are thinly traded and our estimate of the fair value of those
notes, when compared to their redemption value, has increased since December 31, 2008 largely as the result of recent comparable trades being completed at lower discounts.



- 35 -



---

##### Table of Contents

|Item 4. | Controls and Procedures
|------- | -----------------------

(a) Evaluation of Disclosure Controls
and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed by us in the
reports that we file or submit under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SECs rules and forms. These disclosure controls and procedures are
further designed to ensure that such information is accumulated and communicated to management, including the General Partners Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

We carried out an evaluation, under the supervision and with the participation of management, including the General Partners Chief Executive Officer
and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rules 13a-15 and 15d-15. Based upon the foregoing, the General Partners Chief Executive Officer
and Chief Financial Officer concluded that, as of the end of the period covered by this Report, our disclosure controls and procedures are effective in all material respects.

(b) Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over
financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Part II - Other Information



|Item 1. | Legal Proceedings
|------- | -----------------

From time to time, we are parties to a
variety of legal proceedings and claims arising in the ordinary course of our businesses. While these matters generally are covered by insurance, there is no assurance that our insurance will cover any particular proceeding or claim. We presently
believe that all of these proceedings to which we were subject as of June 30, 2009, taken as a whole, will not have a material adverse effect on our liquidity, business, financial condition or results of operations.



|Item 1A. | Risk Factors
|-------- | ------------

In addition to the information set forth in
this Report, you also should carefully review and consider the information contained in our other reports and periodic filings that we make with the SEC, including, without limitation the information contained under the caption Item 1A. Risk
Factors in our Annual Report on Form 10-K for the year ended December 31, 2008. The risks and uncertainties described in our 2008 Annual Report on Form 10-K and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2009
are not the only risks that we face. Additional risks and uncertainties not currently known to us, or that we presently deem to be immaterial, also may materially adversely affect our business, financial condition and results of operations.



|Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds
|------- | -----------------------------------------------------------

(a) Unregistered Sales of Equity Securities

None

(b) Use of Proceeds

None



- 36 -



---

##### Table of Contents

(c) Issuer Purchases of Equity Securities

From time to time, the General Partner may repurchase shares of its common stock under a repurchase program that initially was approved by the General Partners board of directors and publicly announced in
October 2001 (the Repurchase Program). In October 2008, the General Partners board of directors adopted a resolution (the October 2008 Resolution) that reaffirmed managements authority to repurchase shares of the
General Partners common stock under the Repurchase Program and also amended the Repurchase Program to permit the repurchase of outstanding series of the General Partners preferred shares, as well as any outstanding series of debt
securities. The October 2008 Resolution also limited managements authority to repurchase a maximum of $75.0 million of the General Partners common shares, $75.0 million of debt securities and $25.0 million of the General Partners
preferred shares. The authority to repurchase such securities expires in October 2009. In December 2008, the General Partners board of directors granted management further authority, in addition to the previous $75.0 million authorization, to
repurchase any outstanding debt securities maturing through December 31, 2011. Under the Repurchase Program, the General Partner also executes share repurchases on an ongoing basis associated with certain employee elections under its
compensation and benefit programs.

The following table shows the General Partners share repurchase activity for each of the three months in the
quarter ended June 30, 2009:



|      |  |                                    |  |                             |      |                                                                              |       
|----- |  | ---------------------------------- |  | --------------------------- | ---- | ---------------------------------------------------------------------------- | ------
|Month |  | Total Number ofSharesPurchased (1) |  | Average PricePaid per Share |      | Total Number ofShares Purchased asPart of PubliclyAnnounced Plans orPrograms
|April |  | 12,475                             |  | $                           | 7.41 |                                                                              | 12,475
|May   |  | 16,525                             |  | $                           | 9.18 |                                                                              | 16,525
|June  |  | 14,267                             |  | $                           | 9.05 |                                                                              | 14,267
|      |  |                                    |  |                             |      |                                                                              |       
|Total |  | 43,267                             |  | $                           | 8.62 |                                                                              | 43,267
|      |  |                                    |  |                             |      |                                                                              |       



|(1) | All 43,267 shares repurchased represent common shares of the General Partner repurchased under our Employee Stock Purchase Plan.
|--- | --------------------------------------------------------------------------------------------------------------------------------



|Item 3. | Defaults upon Senior Securities
|------- | -------------------------------

During the period covered
by this Report, we did not default under the terms of any of our material indebtedness, nor has there been any material arrearage of distributions or other material uncured delinquency with respect to any class of our preferred equity.



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

On
April 29, 2009, the General Partner held its 2009 annual meeting of shareholders (the Annual Meeting). The General Partners shareholders were asked to take action to (a) elect directors to serve on its board of directors
until the General Partners annual meeting of shareholders in 2010, (b) ratify the appointment of KPMG LLP to serve as our independent auditors for the fiscal year ending December 31, 2009 and (c) approve the General
Partners Amended and Restated 2005 Long-Term Incentive Plan, which includes an increase in the number of shares of its common stock that may be issued thereunder by 3,900,000 shares, and re-approve a list of qualified business criteria for
performance-based awards in order to preserve Federal income tax deductions.



- 37 -



---

##### Table of Contents

At the Annual Meeting, the General Partners shareholders elected each of Thomas J. Baltimore, Jr., Barrington H.
Branch, Geoffrey Button, William Cavanaugh, III, Ngaire E. Cuneo, Charles R. Eitel, Dr. Martin C. Jischke, L. Ben Lytle, Dennis D. Oklak, Jack R. Shaw, Lynn C. Thurber, and Robert J. Woodward, Jr. to serve as directors for a one-year term.
The number of votes cast for and withheld from each of the director nominees was as follows:



|                         |  |             |  |          
|------------------------ |  | ----------- |  | ---------
|NOMINEE                  |  | FOR         |  | WITHHELD 
|Thomas J. Baltimore, Jr. |  | 129,092,736 |  | 3,375,251
|Barrington H. Branch     |  | 129,092,736 |  | 3,463,798
|Geoffrey Button          |  | 127,977,482 |  | 4,490,505
|William Cavanaugh III    |  | 128,915,192 |  | 3,552,795
|Ngaire E. Cuneo          |  | 125,780,812 |  | 6,687,175
|Charles R. Eitel         |  | 129,110,870 |  | 3,357,117
|Dr. Martin C. Jischke    |  | 128,355,659 |  | 4,112,328
|L. Ben Lytle             |  | 128,445,587 |  | 4,022,400
|Dennis D. Oklak          |  | 127,313,373 |  | 5,154,614
|Jack R. Shaw             |  | 129,036,525 |  | 3,431,462
|Lynn C. Thurber          |  | 129,134,506 |  | 3,333,481
|Robert J. Woodward, Jr.  |  | 129,069,062 |  | 3,398,925

The holders of 130,699,725 shares of the General Partners common stock voted FOR the ratification of
the appointment of KPMG LLP to serve as our independent auditors for the fiscal year ending December 31, 2008, the holders of 1,322,014 shares voted AGAINSTsuch appointment, and the holders of 436,248 ABSTAINED from voting on
such matters. As a result, this proposal was approved.

The holders of 89,072,993 shares of the General Partners common stock voted FOR the
approval of the Amended and Restated 2005 Long-Term Incentive Plan, the holders of 8,316,054 shares voted AGAINST approval of such matter, and the holders of 432,877 shares ABSTAINEDfrom voting on such matter. As a result, this
proposal was approved.



|Item 5. | Other Information
|------- | -----------------

During the period covered by this Report,
there was no information required to be disclosed by us in a Current Report on Form 8-K that was not so reported, nor were there any material changes to the procedures by which our security holders may recommend nominees to the General
Partners board of directors.



- 38 -



---

##### Table of Contents

|Item 6. | Exhibits
|------- | --------



|(a) | Exhibits
|--- | --------



|     |  |                                                                                                                                                                                                                                                                                                                            
|---- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     | 
|3.1  |  | Certificate of Limited Partnership of Duke Realty Limited Partnership, dated September 17, 1993 (filed as Exhibit 3.1 to the Partnerships Annual Report on Form 10-K for the fiscal
year ended December 31, 2006, as filed with the SEC on March 13, 2007, File No. 000-20625, and incorporated herein by this reference).
|     | 
|10.1 |  | Third Amended and Restated Agreement of Limited Partnership of DRLP (filed as Exhibit 3.1 to DRLPs Current Report on Form 8-K as filed with the SEC on August 5, 2009, File No. 000-20625,
and incorporated herein by this reference).                                                                                    
|     | 
|11.1 |  | Statement Regarding Computation of Earnings.**                                                                                                                                                                                                                                                                             
|     | 
|12.1 |  | Statement of Computation of Ratio of Earnings to Fixed Charges and Ratio of Earnings to Combined Fixed Charges and Preferred Distributions.*                                                                                                                                                                               
|     | 
|31.1 |  | Rule 13a-14(a) Certification of the General Partners Chief Executive Officer.*                                                                                                                                                                                                                                            
|     | 
|31.2 |  | Rule 13a-14(a) Certification of the General Partners Chief Financial Officer.*                                                                                                                                                                                                                                            
|     | 
|32.1 |  | Section 1350 Certification of the General Partners Chief Executive Officer.*                                                                                                                                                                                                                                              
|     | 
|32.2 |  | Section 1350 Certification of the General Partners Chief Financial Officer.*                                                                                                                                                                                                                                              



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

|** | Data required by Statement of Financial Accounting Standard No. 128, Earnings per Share, is provided in Note 8 to the Consolidated Financial Statements included in this
report.
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



- 39 -



---

##### Table of Contents

SIGNATURES

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



|                      |  |  |  |                                                            
|--------------------- |  |  |  | -----------------------------------------------------------
|                      |  |  |  | DUKE REALTY LIMITED PARTNERSHIP                            
|                      |  | 
|Date: August 10, 2009 |  |  |  | /s/ Dennis D. Oklak                                        
|                      |  |  |  | Dennis D. Oklak                                            
|                      |  |  |  | Chairman and Chief Executive Officer of the General
Partner
|                      |  | 
|                      |  |  |  | /s/ Christie B. Kelly                                      
|                      |  |  |  | Christie B. Kelly                                          
|                      |  |  |  | Executive Vice President and                               
|                      |  |  |  | Chief Financial Officer of the General Partner