UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                   -----------
                                    Form 10-Q

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

                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000

                          COMMISSION FILE NUMBER 1-8383

                          Mission West Properties, Inc.
             (Exact name of registrant as specified in its charter)

           Maryland                                    95-2635431
           --------                                    ----------
(State or other jurisdiction of          (I.R.S. Employer Identification Number)
 incorporation or organization)

                               10050 Bandley Drive
                        Cupertino, California 95014-2188
                    (Address of principal executive offices)

      Registrant's telephone number, including area code is (408) 725-0700
                                   -----------


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 [ ]


                      APPLICABLE ONLY TO CORPORATE ISSUERS

  Indicate the number of shares outstanding of each of the issuer's classes of
                 Common stock as of the latest practicable date:

                17,025,365 shares outstanding as of May 15, 2000




<PAGE>


                          Mission West Properties, Inc.

                                    FORM 10-Q
                      FOR THE QUARTER ENDED MARCH 31, 2000

                                      INDEX
<TABLE>
<CAPTION>

                                                                                                                    Page
                                                                                                                    ----
<S>          <C>                                                                                                    <C>
PART I        FINANCIAL INFORMATION

   Item 1     Financial Statements:

              Consolidated Balance Sheets as of March 31, 2000
              and December 31, 1999...................................................................................3

              Consolidated Statements of Operations for the three
              months ended March 31, 2000 and 1999....................................................................4

              Consolidated Statements of Cash Flows for the
              three months ended March 31, 2000 and 1999..............................................................5

              Notes to Consolidated Financial Statements..............................................................6

   Item 2     Management's Discussion and Analysis of Financial
              Condition and Results of Operations....................................................................10

   Item 3     Quantitative and Qualitative Disclosures About Market Risk.............................................18


PART II       OTHER INFORMATION

   Item 5     Other Information......................................................................................19

   Item 6     Exhibits and Reports on Form 8-K.......................................................................19


SIGNATURES...........................................................................................................20

</TABLE>

                                     - 2 -
<PAGE>


PART I - FINANCIAL INFORMATION
ITEM 1   CONSOLIDATED FINANCIAL STATEMENTS

                          MISSION WEST PROPERTIES, INC.

                           CONSOLIDATED BALANCE SHEETS

                  (Dollars in thousands, except share amounts)
                                      -----

<TABLE>
<CAPTION>

                                                                                  March 31, 2000         December 31, 1999
                                                                               ----------------------  ----------------------
                                                                                    (Unaudited)
                                     ASSETS
<S>                                                                                     <C>                   <C>
Real estate assets, at cost
   Land                                                                                  $159,302              $149,416
   Buildings and improvements                                                             590,733               566,766
                                                                               ----------------------  ----------------------
                                                                                          750,035               716,182
   Less accumulated depreciation                                                          (22,198)              (18,566)
                                                                               ----------------------  ----------------------
     Net real estate assets                                                               727,837               697,616
Cash and cash equivalents                                                                      13                 6,553
Deferred rent                                                                               6,933                 5,964
Other assets                                                                                5,560                 2,571
                                                                               ----------------------  ----------------------
     Total assets                                                                        $740,343              $712,704
                                                                               ======================  ======================

                      LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
   Line of credit (related parties)                                                        36,070                     -
   Mortgage notes payable                                                                 133,491               133,952
   Mortgage notes payable (related parties)                                                     -                31,193
   Interest payable                                                                         1,005                 1,005
   Security deposits                                                                        3,103                 2,335
   Prepaid rental income                                                                    6,360                 7,802
   Dividends/distributions payable                                                         14,402                14,019
   Refundable option payment                                                               21,564                21,564
   Accounts payable and accrued expenses                                                    4,945                 3,342
                                                                               ----------------------  ----------------------
     Total liabilities                                                                    220,940               215,212

Commitments and contingencies (Note 8)

Minority interest                                                                         418,353               396,810

Stockholders' equity:
   Preferred stock,  $.001 par value,  20,000,000 shares
     authorized, none issued and outstanding                                                    -                     -
   Common stock, $.001 par value, 200,000,000 shares
     authorized, 17,025,365 and 16,972,374 shares issued and
     outstanding at March 31, 2000 and December 31, 1999,
     respectively                                                                              17                    17
  Paid-in-capital                                                                         123,036               122,746
  Accumulated (deficit)                                                                   (22,003)              (22,081)
                                                                               ----------------------  ----------------------
     Total stockholders' equity                                                           101,050               100,682
                                                                               ----------------------  ----------------------
     Total liabilities and stockholders' equity                                          $740,343              $712,704
                                                                               ======================  ======================
</TABLE>

              The accompanying notes are an integral part of these
                       consolidated financial statements.


                                     - 3 -
<PAGE>


                          MISSION WEST PROPERTIES, INC

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                (Dollars in thousands, except per share amounts)
                                   (unaudited)
                                    ---------
<TABLE>
<CAPTION>

                                                  Three months ended March 31,
                                            ----------------------------------------
                                                    2000                1999
                                            ------------------- --------------------
<S>                                             <C>                  <C>
Revenues:
   Rental revenues from real estate                 $21,235              $14,027
   Tenant reimbursements                              3,513                2,236
   Other income, including interest                     186                  149
                                            ------------------- --------------------
                                                     24,934               16,412
                                            ------------------- --------------------

Expenses:
   Operating expenses                                 1,093                  782
   Real estate taxes                                  2,374                1,529
   Depreciation of real estate                        3,633                2,703
   General and administrative                           363                  406
   Interest                                           2,257                2,971
   Interest (related parties)                           751                  416
                                            ------------------- --------------------
     Total expenses                                  10,471                8,807
                                            ------------------- --------------------

Income before minority interest                      14,463                7,605
Minority interest                                    11,832                6,724
                                            ------------------- --------------------
   Net income                                      $  2,631            $     881
                                            =================== ====================
Basic net income per share                         $   0.15            $    0.11
                                            =================== ====================
Diluted net income per share                       $   0.15            $    0.10
                                            =================== ====================
Weighted average number of
  common shares outstanding (basic)              16,990,353            8,227,261
                                            =================== ====================
Weighted average number of
  common shares outstanding (diluted)            17,389,409            8,415,412
                                            =================== ====================

</TABLE>


              The accompanying notes are an integral part of these
                       consolidated financial statements.


                                     - 4 -
<PAGE>


                          MISSION WEST PROPERTIES, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                (Dollars in thousands, except per share amounts)
                                   (unaudited)
<TABLE>
<CAPTION>

                                                                                             Three months ended March 31,
                                                                                           -------------------------------
                                                                                                 2000           1999
                                                                                           --------------- ---------------
<S>                                                                                           <C>              <C>
Cash flows from operating activities:
   Net income                                                                                  $ 2,631          $  881
   Adjustments to reconcile net income (loss) to net cash provided by
     operating activities:
       Minority interest                                                                        11,832           6,724
       Depreciation                                                                              3,633           2,703
       Other                                                                                        17
   Changes in assets and liabilities:
       Deferred rent                                                                              (969)           (753)
       Other assets                                                                             (2,705)           (337)
       Interest payable                                                                              -            (174)
       Interest payable (related parties)                                                            -             416
       Security deposits                                                                           419             (89)
       Prepaid rental income                                                                    (1,707)           (228)
       Accounts payable and accrued expenses                                                       774             203
                                                                                           --------------- ---------------
     Net cash provided by operating activities                                                  13,925           9,346
                                                                                           --------------- ---------------
Cash flows used in investing activities:

   Improvements to real estate assets                                                             (900)           (107)
                                                                                           --------------- ---------------
Cash flows from financing activities:
   Net repayments on line of credit                                                                  -          (8,678)
   Principal payments on mortgage notes payable                                                   (461)           (532)
   Principal payments on mortgage notes payable (related parties)                              (16,441)           (196)
   Proceeds from stock options exercised                                                           290              67
   Minority interest distributions                                                                (408)            (12)
   Dividends paid                                                                               (2,545)              -
                                                                                           --------------- ---------------
     Net cash (used in) financing activities                                                   (19,565)         (9,351)
                                                                                           --------------- ---------------
     Net increase (decrease) in cash and cash equivalents                                       (6,540)           (112)
Cash and cash equivalents, beginning                                                             6,553             246
                                                                                           --------------- ---------------
Cash and cash equivalents, ending                                                              $    13          $  134
                                                                                           =============== ===============
Supplemental information:
   Cash paid for interest                                                                      $ 2,997          $3,139
                                                                                           =============== ===============
Supplemental schedule of non-cash investing and financing activities:
   Advances under line of credit (related parties)                                             $10,783          $    -
                                                                                           =============== ===============
   Assumption of debt in connection with property acquisitions                                 $10,000          $3,525
                                                                                           =============== ===============
   Assumption of other liabilities in connection with property acquisitions                    $ 1,431          $   88
                                                                                           =============== ===============
   Issuance of limited partnership units in connection with property acquisitions              $21,637          $4,945
                                                                                           =============== ===============
</TABLE>

              The accompanying notes are an integral part of these
                       consolidated financial statements.


                                     - 5 -
<PAGE>


                          MISSION WEST PROPERTIES, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         (Amounts in thousands, except share, square footage and limited
                           partnership unit amounts)
                                   (unaudited)
                                      -----


1.   Principles of Consolidation and Basis of Presentation

     The accompanying  consolidated financial statements include the accounts of
     Mission West Properties,  Inc. and its controlled  subsidiaries,  including
     the operating  partnerships (the "Company").  All significant  intercompany
     balances have been eliminated in consolidation.

     Minority  interest   represents  the  separate  private  ownership  of  the
     operating  partnerships  by the Berg Group  (defined  as Carl E. Berg,  his
     brother Clyde J. Berg, members of their respective immediate families,  and
     certain entities they control) and other non-affiliate interests. In total,
     these  interests  account for  approximately  82%, taken as a whole, of the
     ownership  interests  in the real  estate  operations  of the Company as of
     March 31, 2000. Minority interest in earnings has been calculated by taking
     the net  income of the  operating  partnerships  (on a  stand-alone  basis)
     multiplied by the respective minority interest ownership percentage.

     The financial  statements  have been prepared in accordance  with generally
     accepted  accounting  principles  ("GAAP")  applicable to interim financial
     information and pursuant to the rules and regulations of the Securities and
     Exchange   Commission.   Accordingly,   certain  information  and  footnote
     disclosures   normally  included  in  financial   statements   prepared  in
     accordance with GAAP have been condensed or omitted  pursuant to such rules
     and regulations.  However,  in the opinion of management,  all adjustments,
     consisting  only of  normal  recurring  adjustments,  necessary  for a fair
     presentation  have been  included.  The Company  presumes that users of the
     interim  financial  information  herein  have  read or have  access  to the
     audited  financial  statements  for the preceding  fiscal year and that the
     adequacy of additional  disclosure  needed for a fair  presentation  may be
     determined in that context.  The results of operations for the three months
     ended March 31, 2000 are not  necessarily  indicative  of the results to be
     expected for the entire year.

     The  Company  intends  to  qualify  and elect to be taxed as a real  estate
     investment  trust  under the  Internal  Revenue  Code of 1986,  as amended,
     commencing with the taxable year ended December 31, 1999.  Accordingly,  no
     provision  has been made for income  taxes for the three months ended March
     31,  2000.  The Company has not yet filed its December 31, 1999 tax return,
     but has filed an extension.

2.   Real Estate

     PENDING PROJECTS ACQUISITION AGREEMENT

     The Company has entered into a Pending Projects Acquisition Agreement under
     which the Company has  acquired or will acquire  approximately  one million
     rentable square feet of R&D properties upon the completion and leasing of a
     number of pending development projects owned by certain members of the Berg
     Group and other sellers.  The agreement fixes the  acquisition  value to be
     received  by the sellers  based upon the  capitalized  rental  value of the
     property  when fully  leased.  During the first three  months of 2000,  the
     Company  acquired  one  additional  property  under  the  Pending  Projects
     Acquisition  Agreement,  representing  80,640  rentable  square  feet  (see
     Property  Acquisitions  below). At March 31, 2000, there were two remaining
     projects comprising 175,084 rentable square feet, which the Company expects
     to acquire under the Pending Projects Acquisition Agreement.


                                     - 6 -
<PAGE>



     The sellers of the pending  development  projects may elect to receive cash
     or limited  partnership units ("O.P.  Units") at a value of $4.50 per unit,
     which  was set in May  1998  based  on the  $4.50  per  share  price of the
     Company's common stock paid in private placement transactions at that time.
     As the current  market value price of a share of common  stock  exceeds the
     $4.50 price,  this  valuation  represents a  substantial  discount from the
     current market value of the common stock that may be issued in exchange for
     these O.P. Units. Under generally accepted accounting  principles ("GAAP"),
     the acquisition  cost in the form of O.P. Units issued will be valued based
     upon the current market value of the Company's common stock on the date the
     acquisition closes. Consequently, the Company's actual cost of these future
     acquisitions  will  depend  in large  part on the  percentage  of the fixed
     acquisition  value paid for by the issuance of O.P.  Units and the price of
     the Company's common stock on the closing date of the acquisition.

     BERG LAND HOLDINGS OPTION AGREEMENT

     Through the operating partnerships, the Company currently has the option to
     acquire any future R&D,  office and  industrial  property  developed by the
     Berg Group on land  currently  owned or  optioned,  or  acquired  for these
     purposes in the future,  directly or indirectly  by certain  members of the
     Berg Group. At present, there are approximately 228 acres of Silicon Valley
     Land owned  directly or under 50% joint  venture by certain  members of the
     Berg Group under the terms of the Berg Land Holdings Option Agreement.  The
     owners of the future R&D property developments may obtain cash or, at their
     option,  O.P. Units valued at the average closing price of shares of common
     stock over the 30-trading-day  period preceding the acquisition date. As of
     March 31, 2000, the Company had completed three acquisitions under the Berg
     Land Holdings Option Agreement representing  approximately 426,000 rentable
     square feet.  Upon the  Company's  exercise of an option to purchase any of
     the future R&D property developments,  the acquisition price will equal the
     sum of (a) the full construction cost of the building;  (b) 10% of the full
     construction cost of the building;  (c) the acquisition value of the parcel
     as defined in the agreement  upon which the  improvements  are  constructed
     (currently ranging from $8.00 to $20.00 per square foot); (d) 10% per annum
     of the acquisition  value of the parcel for the period from January 1, 1998
     to the close of escrow;  and (e) interest at LIBOR (London  Interbank Offer
     Rate) plus 1.65% per annum on the full  construction  costs of the building
     for the period from the date funds were  disbursed by the  developer to the
     close of escrow;  less (f) any debt  encumbering  the  property or a lesser
     amount as approved by the independent directors committee.

     No  estimate  can be given at this time as to the total cost to the Company
     to acquire projects under the Berg Land Holdings  Agreement,  or the timing
     as to when the Company will acquire such projects.  However, the Berg Group
     is currently  constructing  four properties  with a total of  approximately
     480,000  rentable  square feet of R&D  properties  that the Company has the
     right to acquire under this agreement,  including one property  potentially
     representing  160,000  rentable  square  feet in which the Berg Group holds
     only  a 50%  ownership  interest.  As of  March  31,  2000,  the  estimated
     acquisition price to the operating  partnerships for these four projects is
     $50.7 million.  The final  acquisition price of these four properties could
     differ significantly from this estimate.  In addition to projects currently
     under  development,  the Berg  Land  Holdings  Option  Agreement  gives the
     Company the right to acquire future developments by the Berg Group on up to
     137 additional acres of land currently  controlled by the Berg Group, which
     could support  approximately  2.24 million square feet of new developments.
     Under the Berg Land  Holdings  Option  Agreement,  the Company  also has an
     option to purchase all land acquired,  directly or  indirectly,  by Carl E.
     Berg or Clyde J. Berg that has not been approved with  completed  buildings
     and which is zoned  for,  intended  for or  appropriate  for  research  and
     development,  office and/or industrial  development or use in the states of
     California,  Oregon,  and  Washington.  In  January  2000  the  Berg  Group
     purchased a 50% interest in TBI-Mission West, LLC that was approximately 62
     acres in Morgan Hill,  California,  that might support the  development  of
     approximately 961,000 rentable square feet of R&D properties.

     PROPERTY ACQUISITIONS

     Effective  January 5, 2000, the Company  acquired a newly  constructed  R&D
     property  located  on  Automation  Parkway  in San Jose,  California.  This
     acquisition  added  approximately  80,640 square feet of rentable space and
     was  acquired  from the Berg Group under the Pending  Projects  Acquisition
     Agreement.  The total acquisition  price for this property was $14,594.  In
     connection  with this  acquisition,  the Company assumed $5,000 of debt due
     the Berg Group,  an affiliate of Carl E. Berg and Clyde J. Berg, as well as
     other  liabilities  of $100,  and issued  1,346,480  O.P.  Units to various
     members of the Berg Group.

     Effective  March 1, 2000,  the Company  acquired an  approximately  239,000
     square  foot  R&D  building  located  on  Branham  Lane  East in San  Jose,
     California  from  the  Berg  Group  under  the Berg  Land  Holdings  Option
     Agreement.  The total acquisition  price for this property was $18,359.  In
     connection  with this  acquisition,  the

                                     - 7 -
<PAGE>
     Company  assumed $5,000 of debt due the Berg Group, an affiliate of Carl E.
     Berg and Clyde J. Berg, as well as other liabilities of $1,331,  and issued
     1,438,066 O.P Units to various members of the Berg Group.

     REFUNDABLE OPTION PAYMENT

     During the third  quarter of 1999,  the  Company  entered  into a new lease
     agreement for 2001 Logic Drive with Xilinx,  Incorporated  ("Xilinx").  The
     lease  agreement  includes  an option  granted  to Xilinx to  purchase  the
     building at a  predetermined  price.  In September 1999, in accordance with
     the option  provisions  of the lease  agreement,  Xilinx paid the Company a
     deposit of $21,564 to secure its  option  right.  Xilinx can  exercise  the
     option only between April 30, 2000, and July 31, 2000. Upon exercise of the
     option,  the Company will refund the deposit amount and Xilinx will deposit
     into escrow funds equal to the purchase price. In the event Xilinx does not
     exercise its option, the Company must refund the deposit in full to Xilinx,
     without interest.

3.   Stock Transactions

     During the three months ended March 31, 2000,  options were exercised for a
     total of 52,991 shares; options to purchase 39,237 shares were exercised at
     $4.50 per share,  and options to purchase  13,754 shares were  exercised at
     $8.25 per share. Total proceeds to the Company were $290.

4.   Net Income Per Share

     Basic net  income  per share is  computed  by  dividing  net  income by the
     weighted-average  number  of  common  shares  outstanding  for the  period.
     Diluted net income per share is computed by dividing  net income by the sum
     of the weighted-average  number of common shares outstanding for the period
     plus the assumed exercise of all dilutive securities.

     The computation for weighted average shares is detailed below:
<TABLE>
<CAPTION>

                                                                 Three Months Ended
                                                                   March 31, 2000,
                                                         ----------------------------------
                                                              2000               1999
                                                         ---------------    ---------------
<S>                                                        <C>                 <C>
     Weighted average shares outstanding (basic)            16,990,353          8,227,261
     Incremental shares from assumed option exercises          399,056            188,151
                                                         ---------------    ---------------
     Weighted average shares outstanding (diluted)          17,389,409          8,415,412
                                                         ===============    ===============
</TABLE>

     The  outstanding  O.P. Units,  which are  exchangeable at the unit holder's
     option for shares of common stock on a one-for-one basis have been excluded
     from the  diluted  net income per share  calculation,  as there would be no
     effect on the amounts because the minority interests' share of income would
     also  be  added  back  to net  income.  The  total  number  of  O.P.  Units
     outstanding at March 31, 2000 was 78,990,335.

5.   Related Party Transactions

     As of March 31, 2000, the Berg Group owned  74,669,733  O.P.  Units.  Along
     with the Company's  common shares owned by the Berg Group, the Berg Group's
     ownership as of March 31, 2000 represented  approximately 78% of the equity
     interests of the Company,  assuming conversion of the 78,990,335 O.P. Units
     into the common stock of the Company.

As of March 31, 2000, debt in the amount of $36,070 was due the Berg Group under
the line of credit  established  effectively  March 1, 2000.  The $50,000  Wells
Fargo line of credit  expired on February 29, 2000 and was repaid with  proceeds
from and  replaced by a $50,000  line of credit  from the Berg  Group.  The Berg
Group line of credit is  currently  collateralized  by seven  properties,  bears
interest at LIBOR plus 1.30 percent,  and matures in February  2001. The Company
believes  that the terms of the Berg  Group line of credit  were more  favorable
than those available from Wells Fargo or similar lenders. During the first three
months of 2000,  the Company  increased its  borrowings by $10,000 in connection
with property  acquisitions.  Interest  expense incurred in connection with debt
due the Berg Group was $751 and $416 for the three  months  ended March 31, 2000
and 1999, respectively.

                                     - 8 -
<PAGE>
     Carl E. Berg has a  substantial  financial  interest  in one  company  that
     leases space from the operating  partnerships.  This company occupies 5,862
     square  feet at $0.93 per square  foot per month.  This lease was in effect
     prior to the Company's  acquisition of its general partnership interests in
     July 1998. The lease expires in 2001.

     The Company currently leases space owned by Berg & Berg  Enterprises,  Inc.
     Rental amounts and overhead reimbursements paid to Berg & Berg Enterprises,
     Inc. were $20 for the three months ended March 31, 2000 and 1999.

7.   Subsequent Events

     On March 20, 2000,  the Company  declared a $0.15 per share dividend on its
     common  stock.  The  dividend  was paid on  April  10,  2000 to all  common
     stockholders  of  record  as of  March  31,  2000.  At the same  time,  the
     operating  partnerships paid a distribution of $0.15 per O.P. Unit on April
     10, 2000, as well.

     Effective as of April 1, 2000 the Company acquired an approximately  98,500
     rentable  square foot R&D property in Sunnyvale,  California  from the Berg
     Group under the Berg Land Holdings Option Agreement.  The total acquisition
     price for this property was approximately  $11.6 million,  which was funded
     through  the  assumption  of  debt  and  other  liabilities  as well as the
     issuance of O.P. Units.

8.   Commitments and Contingencies

     The Company and the operating partnerships,  from time to time, are parties
     to litigation arising out of the normal course of business. Management does
     not expect that such matters  would have a material  adverse  effect on the
     consolidated financial position, results of operations or cash flows of the
     Company.

     Insurance policies currently maintained by the Company do not cover seismic
     activity, although they do cover losses from fires after an earthquake.


                                     - 9 -
<PAGE>


        MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                             RESULTS OF OPERATIONS


This Management's  Discussion and Analysis of Financial Condition and Results of
Operations  should be read in  conjunction  with the  accompanying  consolidated
financial  statements  and notes  thereto  contained  herein  and the  Company's
consolidated  financial  statements and notes thereto contained in the Company's
Annual Report on Form 10-K as of and for the year ended  December 31, 1999.  The
results for the three months ended March 31, 2000 are not necessarily indicative
of the results to be expected  for the entire  fiscal year ending  December  31,
2000. The following discussion includes  forward-looking  statements,  including
but not limited to  statements  with respect to the Company's  future  financial
performance,  operating results, plans and objectives. Actual results may differ
materially from those currently anticipated depending upon a variety of factors,
including  those  described  below  under  the   sub-heading,   "Forward-Looking
Information."

Overview

In May 1998, Mission West Properties,  Inc. (the "Company"),  the members of the
Berg  Group,  John  Kontrabecki  and  certain  other  persons  entered  into  an
acquisition   agreement  providing,   among  other  things,  for  the  Company's
acquisition  of  interests  as  the  sole  general   partner  of  four  separate
partnerships  (the  "operating  partnerships").   At  the  time,  the  operating
partnerships  held  approximately  4.34  million  rentable  square  feet  of R&D
property  located in the Silicon  Valley.  The  agreement  also provided for the
parties to enter into the Pending  Projects  Acquisition  Agreement and the Berg
Land  Holdings  Option  Agreement  with the Berg Group and the  exchange  rights
agreement  with all limited  partners in the operating  partnerships,  following
stockholder  approval.  Effective  July 1, 1998,  the  Company  consummated  its
acquisition of the general partnership interests in the operating  partnerships.
The  Company  effected  its  purchase of the general  partnership  interests  by
issuing to each of the operating  partnerships a demand note bearing interest at
7.25% per annum, aggregating approximately $35.2 million of principal payable no
later than July 1, 2000.

Effective  July 1, 1998,  all limited  partnership  interests  in the  operating
partnerships were converted into 59,479,633  operating  partnership units ("O.P.
Units"),  representing  ownership  of  approximately  87.89%  of  the  operating
partnerships,  upon  consummation  of the  acquisition.  Under  the terms of the
exchange  rights  agreement,  each O.P.  Unit may be exchanged  for one share of
common stock after December 29, 1999,  subject to certain  conditions.  The O.P.
Units  represent  the minority  ownership7  interests.  At March 31,  2000,  the
Company   owned  a  17.7%   general   partnership   interest  in  the  operating
partnerships, taken as a whole, on a weighted average basis.

In December 1998,  the Company sold 6,495,058  shares of common stock at a price
of $4.50 per share to a number of accredited  investors to complete its May 1998
private placements.  The aggregate proceeds,  net of fees and offering costs, of
approximately  $27.8 million were used to pay down amounts outstanding under the
demand notes due to the operating  partnerships.  Also, as of December 29, 1998,
the Company and the limited partners in the operating  partnerships entered into
the exchange rights agreement, and the Company entered into the Pending Projects
Acquisition  Agreement and the Berg Land Holdings Option Agreement with the Berg
Group and other sellers.

In July 1999,  the Company  completed a public  offering of 8,680,000  shares of
common stock at $8.25 per share.  The net  proceeds  from this  offering,  after
deducting  underwriting  discounts and other offering costs, were  approximately
$66.9 million and were used primarily to repay indebtedness.

At March 31,  2000,  the  outstanding  balance  under the demand  notes that the
Company owes to the operating  partnerships was approximately $1.12 million. The
principal  of the  demand  notes,  along  with the  interest  expense,  which is
interest income to the operating  partnerships,  is eliminated in  consolidation
and is not  included in the  corresponding  line items  within the  consolidated
financial  statements.  However,  the interest income earned on this debt by the
operating partnerships, which is interest expense to the Company, is included in
the calculation of minority interest as reported on the consolidated  statements
of operations,  thereby reducing net income by this same amount. At present, the
Company's  only  means  for  repayment  of  this  debt,  be it in  this  form or
refinanced  with  another  lender,  is through  distributions  that the  Company
receives from the operating partnerships in excess of the amount of dividends to
be paid to the Company's stockholders.

The Company  intends to elect as part of the Company's 1999 income tax return to
qualify to be taxed as a REIT  commencing  with the taxable year ended  December
31, 1999.

The Company has two wholly owned subsidiaries, MIT Realty, Inc. and Mission West
Executive Aircraft Center. Both corporations are inactive.

                                     - 10 -
<PAGE>
RESULTS OF OPERATIONS

COMPARISON  OF THE THREE  MONTHS  ENDED MARCH 31, 2000 TO THE THREE MONTHS ENDED
MARCH 31, 1999.

As of March 31, 2000,  the  Company,  through its  controlling  interests in the
operating partnerships,  owned 82 properties totaling approximately 5.63 million
square feet compared to 72 properties totaling approximately 4.57 million square
feet owned by the Company as of March 31, 1999.  This  represents an increase of
approximately  23% in total  rentable  square  footage  from one year  ago.  The
increase resulted from the following acquisitions:
<TABLE>
<CAPTION>

               Date of                                                   Rentable Square
             Acquisition                      Address                        Footage
<S>                             <C>                                            <C>
          5/99                   L'Avenida Avenue (5 buildings)                   515,700
          7/99                   1750 Automation Parkway                           80,640
          8/99                   1700 Richard Avenue                               58,783
          10/99                  5749 Fontanosa Way                                77,700
          1/00                   1756 Automation Parkway                           80,640
          3/00                   800 Branham Lane East                            239,000
          -------------------------------------------------------------------------------
                                                                                1,052,463
</TABLE>

The following  table reflects the increase in the Company's  rental revenues for
the three  months  ended March 31, 2000 over rental  revenue for the  comparable
three months in 1999:
<TABLE>
<CAPTION>

                                                        Three months ended March 31,
                                     -------------------------------------------------------------------
                                         2000             1999            $ Change          % Change
                                     -------------    -------------     -------------    ---------------
                                                 (Dollars in thousands)
<S>                                     <C>              <C>                <C>                <C>

          Rental Revenues                $21,235          $14,027            $7,208             51.4%

</TABLE>

Rental  revenues  increased by $7.2 million for the three months ended March 31,
1999 to $21.2  million for the same period of 2000  primarily as a result of the
additional  10  properties  acquired  since  March 31,  1999,  including  rental
revenues of $770,000 generated from the two acquisitions in 2000.

Tenant  reimbursements  increased by $1.3 million or 59%,  from $2.2 million for
the three months ended March 31, 1999 to $3.5 million for the three months ended
March 31, 2000.  Operating  expenses and real estate taxes, on a combined basis,
increased  by $1.2  million or 52%,  from $2.3  million to $3.5  million for the
three months ended March 31, 1999 and 2000, respectively. The increases resulted
primarily  from the  growth in the total  rentable  square  footage  during  the
periods presented.

Depreciation  expense  increased  by $930,000 for the  three-month  period ended
March 31, 2000 over the same period a year ago. The increase was attributable to
the acquisitions of properties since March 31, 1999.

Interest  expense  decreased  by $700,000 or 23% from $3.0 million for the three
months ended March 31, 1999 to $2.3 million for the three months ended March 31,
2000.  Interest  expense  (related  parties)  increased  by $335,000 or 81% from
$416,000  for the three  months  ended March 31, 1999 to $751,000  for the three
months ended March 31, 2000. On a net basis, interest expense (including amounts
to related parties) has decreased given the decrease in overall debt levels.  As
a result of proceeds  received from the July 1999 public offering,  receipt of a
refundable  option  payment,  as well as cash  generated from  operations,  debt
outstanding,  including  amounts due related  parties,  has  decreased  by $29.8
million or 15% from $199.3  million as of March 31, 1999 to $169.5 million as of
March 31, 2000.

The  minority  interest  portion of income was $11.8  million,  resulting in net
income to  shareholders  of $2.6  million for the three  months  ended March 31,
2000.  Minority interest  represents the limited partners' ownership interest in
the  operating  partnerships,  which  was 82% as of March 31,  2000,  taken as a
whole.

CHANGES IN FINANCIAL CONDITION

During the first three  months of 2000,  the  Company  acquired  two  additional
properties  representing  319,640 rentable square feet of newly  constructed R&D
properties  located in Silicon Valley.  These  properties were acquired from the
Berg Group

                                     - 11 -
<PAGE>
under the Pending  Projects  Acquisition  Agreement and the Berg Land
Option  Agreement.  The aggregate  acquisition  price for these  properties  was
$32.95 million.  The Company financed these acquisitions by a) assumption by the
Company of $10 million of debt due the Berg Group;  b) assumption by the Company
of other  liabilities  of $1.4  million;  c) and the issuance of 2,784,546  O.P.
Units.

During the three  months  ended March 31,  2000,  employee  stock  options  were
exercised to purchase a total of 52,991  shares of common  stock,  consisting of
39,237  shares  exercised  at a price of  $4.50  per  share  and  13,754  shares
exercised at $8.25 per share.  Total proceeds to the Company were  approximately
$290.

RECENT DEVELOPMENTS

Effective  as of April 1, 2000 the  Company  acquired  an  approximately  98,500
rentable  square foot R&D property in Sunnyvale,  California from the Berg Group
under the Berg Land Holdings Option  Agreement.  The total acquisition price for
this property was  approximately  $11.6  million,  which was funded  through the
assumption of debt and other liabilities as well as the isuance of O.P. Units.

LIQUIDITY AND CAPITAL RESOURCES

The Company  expects its  principal  sources of liquidity for  distributions  to
stockholders,   debt  service,   leasing   commissions  and  recurring   capital
expenditures  to be Funds  from  Operations  ("FFO"),  or the Berg Group line of
credit.  The Company  expects  these sources of liquidity to be adequate to meet
projected   distributions  to  stockholders  and  other  presently   anticipated
liquidity  requirements  in 2000.  The  Company  expects  to meet its  long-term
liquidity  requirements  for  the  funding  of  property  development,  property
acquisitions  and other  material  non-recurring  capital  improvements  through
long-term  secured and  unsecured  indebtedness  and the issuance of  additional
equity  securities  by the  Company.  The  Company  has the  ability to meet any
short-term  obligations  or other  liquidity  needs  based on the line of credit
(related parties).

The  Company's  $50  million  line of credit  with Wells  Fargo Bank  expired on
February  29,  2000 and was repaid  with  proceeds  from and  replaced  by a $50
million  line of credit  from the Berg  Group.  The Berg Group line of credit is
currently collateralized by seven properties,  bears interest at LIBOR plus 1.30
percent,  and matures in February 2001.  The Company  believes that the terms of
the Berg Group line of credit  were more  favorable  than those  available  from
Wells Fargo or similar lenders.

At March 31,  2000,  the  Company  had  total  indebtedness  of  $169.5  million
including $133.5 million of fixed rate mortgage debt and $36.0 million under the
Berg Group line of credit (related parties).

As of March 31, 2000, the Debt to Total Market  Capitalization  ratio,  which is
computed as the  Company's  total debt  outstanding  divided by the sum of total
debt  outstanding  plus the market value of common stock (based upon the closing
price of $8.56 per share on March 31, 2000) on a fully diluted basis,  including
the  conversion of all O.P.  Units into common stock,  was  approximately  17.1%
based upon an estimated  Total Market  Capitalization  of  approximately  $991.4
million.

                                     - 12 -
<PAGE>

MORTGAGE DEBT

The following table sets forth certain information regarding debt outstanding as
of March 31, 2000:
<TABLE>
<CAPTION>

                                                                                                      Maturity    Interest
              Debt Description                         Collateral Properties           Balance          Date        Rate
-----------------------------------------------  --------------------------------  ---------------  -----------  -----------
                                                                                   ($ in thousands)
<S>                                             <C>                                   <C>             <C>          <C>
Line of Credit (related parties):
                                                 2033-2043 Samaritan Drive, San         36,070          2/01         (1)
Mortgage Notes Payable:
Prudential Capital Group                         20400 Mariani, Cupertino, CA            1,867          3/09        8.75%
New York Life Insurance Company                  10440 Bubb Road, Cupertino, CA            399          8/09        9.625%
Home Savings & Loan Association                  10460 Bubb Road, Cupertino, CA            464          1/07        9.5%
Mellon Mortgage Company                          3530 Bassett, Santa Clara, CA           2,825          6/01        8.125%
Prudential Insurance Company of America          10300 Bubb, Cupertino, CA             127,936(2)      10/08        6.56%
                                                 10500 N. DeAnza, Supertino, CA
                                                 4050 Starboard, Fremont, CA
                                                 45700 Northport Loop, Fremont, CA
                                                 45738 Morthport Loop, Fremont, CA
                                                 450-460 National, Mountain View, CA
                                                 4949 Hellyer, San Jose, CA
                                                 6311 San Ignacio, San Jose, CA
                                                 6321 San Ignacio, San Jose, CA
                                                 6325 San Ignacio, San Jose, CA
                                                 6331 San Ignacio, San Jose, CA
                                                 6341 San Ignacio, San Jose, CA
                                                 6351 San Ignacio, San Jose, CA
                                                 3236 Scott, Santa Clara, CA
                                                 3560 Bassett, Santa Clara, CA
                                                 3570 Bassett, Santa Clara, CA
                                                 3580 Bassett, Santa Clara, CA
                                                 1135 Kern, Sunnyvale, CA
                                                 1212 Bordeaux, Sunnyvale, CA
                                                 1230 E. Arques, Sunnyvale, CA
                                                 1250 E. Arques, Sunnyvale, CA
                                                 1170 Morse, Sunnyvale, CA
                                                 3540 Bassett, Santa Clara, CA
                                                 3542 Bassett, Santa Clara, CA
                                                 3544 Bassett, Santa Clara, CA
                                                 3550 Bassett, Santa Clara, CA
                                                                                   ----------------
Mortgage Notes Payable Subtotal                                                        133,491
                                                                                   ----------------
                    TOTAL                                                             $169,561
                                                                                   ================
</TABLE>


(1)  The debt owed to the Berg Group  carries a variable  interest rate equal to
     LIBOR plus 1.30 percent and is payable in full in February 2001.

(2)  John Kontrabecki, one of the limited partners, has guaranteed approximately
     $12.0 million of this debt.

                                     - 13 -
<PAGE>

The following table presents certain  information  concerning projects for which
the Company, through its interests in the operating partnerships,  has the right
to  acquire  under the Berg  Land  Holdings  Option  Agreement  and the  Pending
Projects Acquisition Agreement.
<TABLE>
<CAPTION>

                                   Approximate
                                  Rentable Area       Anticipated Acquisition         Total Estimated
Property                          (Square Feet)                Date                  Acquisition Value(1)
------------------------------ ------------------- ----------------------------- --------------------------
BERG LAND HOLDINGS                                                                 (dollars in thousands)
<S>                              <C>                     <C>                             <C>
Under Development
Hellyer IV(2)                       160,000               2nd Quarter 2000                 11,600
Hellyer View                         77,184               3rd Quarter 2000                  9,300
Hellyer III (Phase I)               117,740               4th Quarter 2000                 14,800
Hellyer Vista (Phase I)             125,000               4th Quarter 2000                 15,000
                                  ---------                                               -------
               Subtotal             479,924                                                50,700

Available Land
Morgan Hill(3)                      961,000
King Ranch                          889,000
Hellyer & Piercy                    763,000
Fremont & Cushing(4)                387,000
Caspian Way(5)                      200,000
                                  ---------
              Subtotal            3,200,000

PENDING PROJECTS ACQUISITION

Pending Projects
Automation III (1 building)          61,056               2nd Quarter 2000                  6,700
Automation IV (1 building)          114,028               1st Quarter 2001                 12,700
                                  ---------                                               -------
              Subtotal              175,084                                                19,400
                                  ---------                                               -------
TOTAL                             3,855,008                                               $70,100
                                  =========                                               =======
</TABLE>


(1)  The Estimated Acquisition Value that represents the economics for acquiring
     the pending  projects under the terms of the Pending  Projects  Acquisition
     Agreement will differ from the actual  acquisition cost as determined under
     GAAP.
(2)  This  property will be operated and managed by the Company and owned by the
     partnership in which the Company will own an approximate 50% interest.
(3)  The Company  expects to own an approximate  50% interest in the partnership
     to be formed to develop the  property.  The  property  will be operated and
     managed by the other partner in the entity.
(4)  The Berg Group purchased this property in January 2000.
(5)  The Company  acquired Phase I of this property in April 2000  consisting of
     98,500 rentable square feet.

Pursuant to the Berg Land Holdings Option Agreement  between the Company and the
Berg  Group,  the  Company  currently  has the option to acquire any future R&D,
office and industrial  property developed by the Berg Group on land it currently
owns or has under option, or acquires for these purposes in the future, directly
or indirectly by certain members of the Berg Group.

The time required to complete the leasing of developments varies from project to
project. Generally, the Company will not acquire any of the above projects until
they  are  fully  completed  and  leased.  There  can be no  assurance  that the
acquisition  date and final  cost to the  Company  as  indicated  above  will be
realized.

Although the Company expects to acquire the new properties available to it under
the  terms of the  Pending  Projects  Acquisition  Agreement  and the Berg  Land
Holdings Option  Agreement,  there can be no assurance that the Company actually
will  consummate  any of  the  intended  transactions,  including  all of  those
discussed  above.  Furthermore,  the

                                     - 14 -
<PAGE>
Company has not yet  determined  the means by which it would acquire and pay for
any such  properties or the impact of any of the  acquisitions  on its business,
results  of  operations,   financial  condition,   FFO  or  available  cash  for
distribution.

During the third quarter of 1999, the Company entered into a new lease agreement
for 2001 Logic Drive with Xilinx,  Incorporated ("Xilinx").  The lease agreement
includes an option granted to Xilinx to purchase the building at a predetermined
price. In September 1999, in accordance with the option  provisions of the lease
agreement,  Xilinx paid to the Company a deposit of $21,564 to secure its option
right.  Xilinx can exercise the option only between  April 30, 2000 and July 31,
2000.  Upon exercise of the option,  the Company will refund the deposit  amount
and Xilinx will deposit into escrow  funds equal to the purchase  price.  In the
event Xilinx does not  exercise its option,  the Company must refund the deposit
in full to Xilinx, without interest.

HISTORICAL CASH FLOWS

Net cash provided by operating  activities  for the three months ended March 31,
2000 was $13.9 million compared to $9.3 million for the same period in 1999. The
change was a direct result of rent increases and new acquisitions.

Net cash used in investing  activities was  approximately  $900,000 and $107,000
for the three months ended March 31, 2000 and 1999,  respectively.  Cash used in
investing activities during the three months ended March 31, 2000 was related to
tenant improvements made to existing real estate assets.

Net cash used in  financing  activities  was $19.6  million for the three months
ended  March 31,  2000  compared  to $9.4  million  for the same period in 1999.
During  the three  months  ended  March  31,  2000,  the  Company  reduced  debt
outstanding and made  distributions  to holders of its common stock and the O.P.
Units by utilizing cash generated from operating activities.

CAPITAL EXPENDITURES

The  properties  require  periodic  investments  of capital  for  tenant-related
capital expenditures and for general capital  improvements.  For the years ended
December 31, 1994 through  December 31, 1998, the recurring  tenant  improvement
costs and  leasing  commissions  incurred  with  respect to new leases and lease
renewals of the properties previously owned or controlled by members of the Berg
Group averaged approximately $1.5 million annually. The Company expects that the
average annual cost of recurring tenant  improvements  and leasing  commissions,
related to the  properties,  will be  approximately  $1.5  million.  The Company
believes it will recover  substantially all of these sums from the tenants under
the new or renewed leases through increases in rental rates. The Company expects
to meet  its  long-term  liquidity  requirements  for the  funding  of  property
development,  property  acquisitions  and other material  non-recurring  capital
improvements  through  long-term  secured  and  unsecured  indebtedness  and the
issuance of additional equity securities by the Company.

FUNDS FROM OPERATIONS

As  defined  by the  National  Association  of  Real  Estate  Investment  Trusts
("NAREIT"),  FFO  represents  net income  (loss)  before  minority  interest  of
unitholders (computed in accordance with GAAP), excluding gains (or losses) from
debt restructuring and sales of property,  plus real estate related depreciation
and  amortization  (excluding  amortization  of  deferred  financing  costs  and
depreciation of non-real estate assets) and after adjustments for unconsolidated
partnerships and joint ventures. Management considers FFO an appropriate measure
of performance  of an equity REIT because,  along with cash flows from operating
activities, financing activities and investing activities, it provides investors
with an  understanding  of the Company's  ability to incur and service debt, and
make capital  expenditures.  FFO should not be considered as an alternative  for
net income as a measure of profitability  and it is not comparable to cash flows
provided by operating activities  determined in accordance with GAAP, nor is FFO
necessarily  indicative  of funds  available to meet the  Company's  cash needs,
including its need to make cash distributions to satisfy REIT requirements.

The Company's  definition of FFO also assumes conversion at the beginning of the
period of all convertible securities, including minority interests that might be
exchanged  for common stock.  FFO does not  represent  the amount  available for
management's  discretionary  use;  as  such  funds  may be  needed  for  capital
replacement  or expansion,  debt service  obligations or other  commitments  and
uncertainties.

                                     - 15 -
<PAGE>
Furthermore, FFO is not comparable to similarly entitled items reported by other
REITs that do not define them  exactly as the Company  defines  FFO. FFO for the
three months ended March 31, 2000 and 1999 are summarized in the table below:
<TABLE>
<CAPTION>

                                        Three Months Ended March 31,
                                     ----------------------------------
                                           2000               1999
                                     ---------------    ---------------
<S>                                      <C>                <C>
          Net income                       $2,631              $ 881
          Add:
              Minority interest            11,832              6,724
              Depreciation                  3,633              2,703
                                     ---------------    ---------------
          FFO                             $18,096            $10,308
                                     ===============    ===============
</TABLE>

DISTRIBUTION POLICY

The Company intends to pay distributions to stockholders  based upon total Funds
Available   for   Distribution   ("FAD"),   which  is  calculated  as  FFO  less
straight-lined  rents,  leasing  commissions paid and capital  expenditures made
during the respective period. The calculations of FAD for the three months ended
March 31, 2000 and 1999 are as follows:
<TABLE>
<CAPTION>

                                        Three Months Ended March 31,
                                     ----------------------------------
                                           2000               1999
                                     ---------------    ---------------
<S>                                      <C>                <C>
          FFO                             $18,096            $10,308
          Less:
              Straight-line rents             969                753
              Leasing commissions             150                 78
              Capital expenditures            900                108
                                     ---------------    ---------------
          FAD                             $16,077            $ 9,369
                                     ===============    ===============
</TABLE>

The Company intends to make regular quarterly distributions to holders of common
stock based on its FAD. The Company's ability to make such distributions will be
affected  by  numerous  factors,  including,  most  importantly,  the receipt of
distributions from the operating partnerships.

FAD does not represent cash  generated  from operating  activities in accordance
with generally accepted accounting principles and is not necessarily  indicative
of cash  available to fund cash needs.  The actual  return that the Company will
realize and the amount available for  distributions to its stockholders  will be
affected  by a number of  factors,  including  the  revenues  received  from its
properties,  its operating expenses, the interest expense incurred on borrowings
and planned and unanticipated capital expenditures.

The  Company  anticipates  that cash  available  for  distribution  will  exceed
earnings and profits for federal  income tax  purposes,  as the latter figure is
reduced by non-cash  expenses,  such as depreciation and amortization,  that the
Company will incur. Distributions, other than capital gain distributions, by the
Company to the extent of its current and  accumulated  earnings  and profits for
federal income tax purposes most likely will be taxable to U.S.  stockholders as
ordinary   dividend  income  unless  a  stockholder  is  a  tax-exempt   entity.
Distributions  in excess of earnings and profits  generally will be treated as a
non-taxable reduction of the U.S. stockholder's basis in the common stock to the
extent of such basis,  and  thereafter as a taxable gain. The percentage of such
distributions in excess of earnings and profits, if any, may vary from period to
period.   The  Company   anticipates  that  a  substantial   percentage  of  the
distributions  to  stockholders  for the year  ending  December  31,  2000  will
constitute taxable income.

Distributions  will be determined  by the Company's  board of directors and will
depend on actual FAD, the Company's financial condition,  capital  requirements,
the annual  distribution  requirements under the REIT provisions of the Code and
such other factors as the board of directors deems relevant.

IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS

The  Company  does  not  believe  recently  issued  accounting   standards  will
materially impact the Company's financial statements.

FORWARD LOOKING INFORMATION

This quarterly report contains forward-looking  statements within the meaning of
the federal securities laws. The Company intends such forward-looking statements
to be covered  by the safe  harbor  provisions  for  forward-looking

                                     - 16 -
<PAGE>

statements  contained  in the  Private  Securities  Reform  Act of 1995,  and is
including  this  statement  for  purposes  of  complying  with these safe harbor
provisions.  Forward-looking statements,  which are based on certain assumptions
and describe  future plans,  strategies  and  expectations  of the Company,  are
generally  identifiable  by use  of the  words  "believe,"  "expect,"  "intend,"
"anticipate,"  "estimate,"  "project"  or  similar  expressions.  The  Company's
ability to predict results or the actual effect of future plans or strategies is
inherently uncertain.  Factors which could have a material adverse effect on the
operations and future prospects of the Company include,  but are not limited to,
changes  in:   economic   conditions   generally  and  the  real  estate  market
specifically,   legislative  or  regulatory  provisions  affecting  the  Company
(including  changes to laws  governing the taxation of REITs),  availability  of
capital,  interest  rates,  competition,  supply of and  demand  for  office and
industrial  properties in the Company's  current and proposed market areas,  and
general accounting  principles,  policies and guidelines applicable to REITs. In
addition,  the acquisition  costs of projects acquired from the Berg Group under
the Pending  Projects  Acquisition  Agreement will vary based upon the number of
O.P.  Units issued in exchange  for the property and the price of common  stock,
which is issuable upon conversion of O.P. Units under certain circumstances,  at
the time of the acquisition.  These risks and  uncertainties,  together with the
other  risks  described  from time to time in the  Company's  reports  and other
documents  filed  with  the  Securities  and  Exchange  Commission,   should  be
considered in evaluating  forward-looking  statements and undue reliance  should
not be placed on such statements.

                                     - 17 -
<PAGE>
ITEM 3

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

No material  changes have occurred  since the Annual Report on Form 10-K for the
year ended December 31, 1999.

                                     - 18 -
<PAGE>



================================================================================
Part II - Other Information

ITEM 2

CHANGES IN SECURITIES AND USE OF PROCEEDS

The  information  provided in Part I,  "Management's  Discussion and Analysis of
Financial  Condition  and Results of Operations - Overview" is  incorporated  by
reference in response to this item.

ITEM 6

EXHIBITS AND REPORTS ON FORM 8-K

         a.       Exhibits

                  27.1 Financial Data Schedule

         b.       Reports on Form 8-K

                  None

================================================================================

                                     - 19 -
<PAGE>


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 thereto duly authorized.


                                               MISSION WEST PROPERTIES, INC.
                                               (Registrant)


Date:   May 15, 2000                           By:  /s/ Carl E. Berg
                                                  --------------------------
                                                  Carl E. Berg
                                                  Chief Executive Officer
                                                 (Principal Accounting Officer)



                                     - 20 -