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 JUNE 30, 2003

                          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 [ ]

Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Exchange Act Rule 12b-2). 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:

               17,744,691 shares outstanding as of August 12, 2003


                                     - 1 -

<PAGE>


                          Mission West Properties, Inc.

                                    FORM 10-Q
                       FOR THE QUARTER ENDED JUNE 30, 2003

<TABLE>
<CAPTION>

                                      INDEX

                                                                                                                     Page
PART I        FINANCIAL INFORMATION                                                                                  ----

   Item 1.    Financial Statements (unaudited):

<S>                                                                                                                 <C>
              Consolidated Balance Sheets as of June 30, 2003
              and December 31, 2002...................................................................................3

              Consolidated Statements of Operations for the three
              and six months ended June 30, 2003 and 2002.............................................................4

              Consolidated Statements of Cash Flows for the
              six months ended June 30, 2003 and 2002.................................................................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.............................................20

   Item 4.    Controls and Procedures................................................................................20


PART II       OTHER INFORMATION

   Item 4.    Submission of Matters to a Vote of Security Holders....................................................21

   Item 6.    Exhibits and Reports on Form 8-K.......................................................................21

SIGNATURES...........................................................................................................22

</TABLE>

                                     - 2 -
<PAGE>


PART I - FINANCIAL INFORMATION
ITEM 1   CONSOLIDATED FINANCIAL STATEMENTS

                          MISSION WEST PROPERTIES, INC.
                           CONSOLIDATED BALANCE SHEETS
           (Dollars in thousands, except share and per share amounts)
                                   (Unaudited)
                                    ---------
<TABLE>
<CAPTION>
                                                                                   June 30, 2003         December 31, 2002
                                                                               ----------------------  ----------------------

                                    ASSETS
<S>                                                                                <C>                       <C>
Real estate assets, at cost
    Land                                                                            $  276,405                $234,707
    Buildings and improvements                                                         795,415                 726,581
                                                                               ----------------------  ----------------------
       Total investments in properties                                               1,071,820                 961,288
    Less accumulated depreciation                                                      (76,049)                (66,560)
                                                                               ----------------------  ----------------------
       Net investments in properties                                                   995,771                 894,728
    Investment in unconsolidated joint venture                                           2,159                       -
                                                                               ----------------------  ----------------------
    Net investments in real estate assets                                              997,930                 894,728
Cash and cash equivalents                                                                2,745                   4,479
Deferred rent                                                                           17,451                  17,001
Other assets                                                                            13,477                  13,198
                                                                               ----------------------  ----------------------
       Total assets                                                                 $1,031,603                $929,406
                                                                               ======================  ======================

                      LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
    Line of credit (related parties)                                                $    4,185                $ 58,792
    Revolving line of credit                                                            18,431                  23,839
    Loan payable                                                                             -                  20,000
    Mortgage notes payable                                                             302,352                 125,062
    Mortgage notes payable (related parties)                                            10,923                  11,078
    Interest payable                                                                       335                     337
    Security deposits                                                                   10,664                  11,184
    Prepaid rental income                                                               14,056                   9,876
    Dividend/distribution payable                                                       25,017                  24,951
    Accounts payable and accrued expenses                                                4,672                   4,698
                                                                               ----------------------  ----------------------
       Total liabilities                                                               390,635                 289,817

Commitments and contingencies (Note 6)

Minority interests                                                                     528,317                 528,768

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, 17,739,691 and 17,487,329 shares issued and
       outstanding at June 30, 2003 and December 31, 2002,
       respectively                                                                         18                      17
    Paid-in-capital                                                                    130,429                 128,295
    Accumulated deficit                                                                (17,796)                (17,491)
                                                                               ----------------------  ----------------------
       Total stockholders' equity                                                      112,651                 110,821
                                                                               ----------------------  ----------------------
       Total liabilities and stockholders' equity                                   $1,031,603                $929,406
                                                                               ======================  ======================
</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 share and per share amounts)
                                   (Unaudited)
                                    ---------
<TABLE>
<CAPTION>

                                                       Three months ended June 30,                Six months ended June 30,
                                                       2003                  2002                 2003                 2002
                                                --------------------  -------------------- -------------------- --------------------
<S>                                                  <C>                   <C>                <C>                     <C>
Revenues:
   Rental revenues from real estate                      $33,194               $32,753            $64,626               $65,238
   Tenant reimbursements                                   4,990                 4,875              9,565                10,201
   Other income, including interest                          569                   278              1,303                   774
                                                --------------------  -------------------- -------------------- --------------------
        Total revenues                                    38,753                37,906             75,494                76,213
                                                --------------------  -------------------- -------------------- --------------------

Expenses:
   Operating expenses                                      1,891                 1,921              3,410                 4,196
   Real estate taxes                                       3,440                 3,003              6,515                 6,060
   Depreciation and amortization                           5,397                 4,455              9,961                 8,811
   General and administrative                                322                   370                680                   804
   Interest                                                4,356                 2,362              7,761                 4,633
   Interest (related parties)                                256                   899                550                 1,909
                                                --------------------  -------------------- -------------------- --------------------
       Total expenses                                     15,662                13,010             28,877                26,413
                                                --------------------  -------------------- -------------------- --------------------

Income before equity in earnings of
unconsolidated joint venture & minority interests         23,091                24,896             46,617                49,800
Equity in earnings of unconsolidated joint
venture                                                    2,023                     -              2,760                     -
Minority interests                                        20,958                20,823             41,187                41,591
                                                --------------------  -------------------- -------------------- --------------------
   Income from continuing operations                       4,156                 4,073              8,190                 8,209
                                                --------------------  -------------------- -------------------- --------------------

Discontinued operations, net minority interests:
Gain from disposal of discontinued operations                  -                     -                  -                 1,016
Income attributable to discontinued operations                 -                     -                  -                    48
                                                --------------------  -------------------- -------------------- --------------------
   Income from discontinued operations                         -                     -                  -                 1,064
                                                --------------------  -------------------- -------------------- --------------------

Net income to common stockholders                        $ 4,156               $ 4,073            $ 8,190               $ 9,273
                                                ====================  ==================== ==================== ====================
Net income to minority interests                         $20,958               $20,823            $41,187               $46,917
                                                ====================  ==================== ==================== ====================
Income per share from continuing operations:
   Basic                                                 $0.23                 $0.23              $0.46                 $0.47
                                                ====================  ==================== ==================== ====================
   Diluted                                               $0.23                 $0.23              $0.46                 $0.46
                                                ====================  ==================== ==================== ====================
Income per share from discontinued operations:
   Basic                                                       -                     -                  -               $0.06
                                                ====================  ==================== ==================== ====================
   Diluted                                                     -                     -                  -               $0.06
                                                ====================  ==================== ==================== ====================
Net income per share to common stockholders:
   Basic                                                 $0.23                 $0.23              $0.46                 $0.53
                                                ====================  ==================== ==================== ====================
   Diluted                                               $0.23                 $0.23              $0.46                 $0.52
                                                ====================  ==================== ==================== ====================
Weighted average number of shares of
  common stock outstanding (basic)                    17,701,999            17,464,692         17,669,808            17,434,796
                                                ====================  ==================== ==================== ====================
Weighted average number of shares of
  common stock outstanding (diluted)                  17,762,773            17,902,853         17,728,638            17,878,483
                                                ====================  ==================== ==================== ====================
</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)
                                   (Unaudited)
                                    ---------
<TABLE>
<CAPTION>

                                                                                               Six months ended June 30,
                                                                                         --------------------------------------
                                                                                               2003                2002
                                                                                         ------------------ -------------------
<S>                                                                                      <C>                 <C>
Cash flows from operating activities:
     Net income                                                                           $     8,190         $     9,273
     Adjustments to reconcile net income to net cash provided by
       operating activities:
            Minority interests                                                                 41,187              46,917
            Depreciation                                                                        9,961               8,857
            Gain on sales of assets                                                                 -              (6,103)
            Equity in earnings of unconsolidated joint venture                                 (2,760)                  -
            Distributions from unconsolidated joint venture                                     1,000                   -
            Other                                                                                  10                 (19)
     Changes in assets and liabilities:
            Deferred rent                                                                        (450)                604
            Other assets                                                                          584                 870
            Interest payable                                                                       (2)                 (2)
            Security deposits                                                                    (520)                (77)
            Prepaid rental income                                                               4,181               3,659
            Accounts payable and accrued expenses                                                (286)                690
                                                                                         ------------------ -------------------
     Net cash provided by operating activities                                                 61,095              64,669
                                                                                         ------------------ -------------------

Cash flows from investing activities:
     Improvements to real estate assets/new equipment                                            (991)               (943)
     Refundable option payment                                                                      -             (18,836)
     Real estate purchase                                                                    (110,008)            (31,311)
     Proceeds from sales of real estate                                                             -              18,591
     Restricted cash                                                                                -              12,714
     Proceeds from sale of joint venture real estate                                            1,400                   -
                                                                                         ------------------ -------------------
     Net cash used in investing activities                                                   (109,599)            (19,785)
                                                                                         ------------------ -------------------

Cash flows from financing activities:
    Principal payments on mortgage notes payable                                               (2,709)             (1,003)
    Proceeds from mortgage note payable                                                       180,000                   -
    Principal payments on mortgage notes payable (related parties)                               (155)               (144)
    Net payments under line of credit (related parties)                                       (54,607)            (13,613)
    Proceeds from loan payable                                                                      -              20,000
    Payment on loan payable                                                                   (20,000)                  -
    Payment on revolving line of credit                                                        (5,408)                  -
    Financing costs                                                                              (863)                (52)
    Proceeds from stock options exercised                                                         560                 151
    Minority interests distributions                                                          (41,614)            (41,371)
    Dividends paid                                                                             (8,434)             (8,350)
                                                                                         ------------------ -------------------
     Net cash provided by (used in) financing activities                                       46,770             (44,382)
                                                                                         ------------------ -------------------
     Net (decrease) increase in cash and cash equivalents                                      (1,734)                502
Cash and cash equivalents, beginning                                                            4,479               5,310
                                                                                         ------------------ -------------------
Cash and cash equivalents, ending                                                         $     2,745         $     5,812
                                                                                         ================== ===================

Supplemental information:
    Cash paid for interest                                                                $     8,158         $     6,379
                                                                                         ================== ===================
Supplemental schedule of non-cash investing and financing activities:
    Debt incurred in connection with property acquisitions (related parties)                        -         $     7,500
                                                                                         ================== ===================
    Assumption of other liabilities in connection with property acquisitions              $       783         $       398
                                                                                         ================== ===================
    Issuance of operating partnership units in connection with property acquisitions      $         -         $     6,152
                                                                                         ================== ===================
    Issuance of operating partnership units in connection with joint venture acquisition  $     1,800         $         -
                                                                                         ================== ===================
</TABLE>

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

                                     - 5 -
<PAGE>


                          MISSION WEST PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

      (Dollars in thousands, except per share data and per square footage)
                                   (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.

     Certain prior year amounts have been reclassified to conform to the current
     year's  presentation.  There is no  impact on net  income or  stockholders'
     equity.

     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 83% of the ownership interests in
     the real estate  operations  of the Company as of June 30,  2003.  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 accounting
     principles  generally  accepted  in the United  States of America  ("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 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  and six  months  ended  June 30,  2003 are not  necessarily
     indicative of the results to be expected for the entire year.

     The Company accounts for its investments in  unconsolidated  joint ventures
     under the  equity  method  of  accounting  as the  Company  exercises  some
     influence,  but does not operate,  manage or control the properties.  These
     investments  are recorded at cost and  subsequently  adjusted for equity in
     earnings and cash contributions and distributions.

     The Company adopted  Statement of Financial  Accounting  Standards No. 144,
     "Accounting for the Impairment or Disposal of Long Lived Assets," effective
     January 1, 2002 (see note 7).

     In January 2003, the FASB Interpretation No. 46, "Consolidation of Variable
     Interest  Entities - an  interpretation  of ARB No. 15" ("FIN 46").  FIN 46
     requires that any entity meeting  certain rules and relation to a company's
     equity  investment  risk and level of financial  control be considered as a
     variable  interest  entity.  The  statement is  applicable  to all variable
     interest entities created or acquired after January 31, 2003, and the first
     interim  period  beginning  after  June 15,  2003,  for  variable  interest
     entities in which the Company  holds a variable  interest  that is acquired
     before  February 1, 2003.  The Company plans on adopting FIN 46 in the time
     frames as  required by the  statement.  Management  expects no  significant
     effect on the  consolidated  financial  position,  results of operations or
     cash  flows of the  Company  as a result of the  initial  adoption  of this
     standard in regard to existing variable interest entities;  however,  newly
     formed entities in 2003 could meet these  requirements and will be recorded
     as appropriate.

     The  Company  has  elected to be taxed as a real  estate  investment  trust
     ("REIT") under the Internal Revenue Code of 1986, as amended.  Accordingly,
     no  provision  has been made for income  taxes for the three and six months
     ended June 30, 2003.

2.   REAL ESTATE

     BERG LAND HOLDINGS OPTION AGREEMENT
     Under the terms of the Berg Land Holdings  Option  Agreement,  the Company,
     through the  operating  partnerships,  has the option to acquire any future
     Research & Development  ("R&D"),  office and industrial buildings developed
     by the Berg Group on land currently owned,  optioned, or acquired for these
     purposes in the future,  directly or indirectly,  by certain members of the
     Berg Group. At present, there are approximately 250 acres of Silicon Valley
     land,  including land under development,  owned directly or under 50% joint
     venture entities,  by certain members of the Berg Group that are subject to
     the terms of the Berg Land  Holdings  Option  Agreement.  The owners of the
     future  R&D  property  developments  may obtain

                                     - 6 -
<PAGE>

     cash or, at their option,  operating  partnership  interests ("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 June 30, 2003,
     the Company had  completed  19  acquisitions  under the Berg Land  Holdings
     Option Agreement representing approximately 1,864,000 rentable square feet.
     Upon the Company's  exercise of an option to purchase any of the future R&D
     property  developments  under the terms of the Berg  Land  Holdings  Option
     Agreement,  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 $7.50 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 members of the  independent  directors  committee  of the  Company's
     board of directors.

     Under the Berg Land Holdings Option Agreement,  as long as the Berg Group's
     percentage ownership interest in the Company and the operating partnerships
     taken  as a whole is at least  65%,  the  Company  also  has an  option  to
     purchase  all land  acquired,  directly or  indirectly,  by Carl E. Berg or
     Clyde J. Berg in the  future  which has not been  improved  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.

     INVESTMENT IN UNCONSOLIDATED JOINT VENTURE
     Effective  January 1, 2003, the Company  acquired a 50% interest in a joint
     venture with TBI in Morgan Hill,  California for $1,800 from the Berg Group
     under the Berg Land Holdings  Option  Agreement.  The Company  financed the
     acquisition  of its 50% interest with the issuance of 181,032 O.P. units to
     the Berg  Group.  The joint  venture  consists of four R&D  buildings  with
     approximately  593,000 rentable square feet, which are operated and managed
     by TBI, the other partner in the joint venture. The Company's investment in
     this joint venture is reflected as an investment  in  unconsolidated  joint
     venture on the accompanying consolidated balance sheets. This investment is
     not  consolidated  because TBI has management and control over  significant
     day-to-day operating activities.

     On April 1, 2003, the Company's  joint venture  acquired a 60,000  rentable
     square foot shell building in Morgan Hill,  California  from the Berg Group
     under the Berg Land Holdings Option  Agreement.  The joint venture financed
     100% of the cost of the  building.  The building was sold on April 2, 2003.
     The Company  received a cash  distribution and recognized a gain of $1,400,
     its proportionate share, on the sale.

     PROPERTY ACQUISITIONS
     Effective  April 9, 2003,  the  Company  acquired a 36-acre  seven-building
     campus style office/R&D project comprised of approximately 625,000 rentable
     square feet at San Tomas and Central Expressway in Santa Clara, California,
     also known as the San Tomas  Technology  Park. The project was acquired for
     approximately  $110,000  from an unrelated  third party and financed with a
     combination of debt and cash  reserves.  The debt component is comprised of
     an $80,000 short term loan from Citicorp USA, Inc., which is collateralized
     by the  acquired  properties.  This loan bears  interest  at an annual rate
     equal to LIBOR plus 2% and matures in April 2004. In addition,  the Company
     utilized  approximately  $19,200  of its  operating  line  of  credit  with
     Cupertino   National  Bank  in  connection  with  this   acquisition.   The
     Consolidated  Statements of  Operations  for the three and six months ended
     June 30, 2003 include revenues and expenses from the acquired properties at
     the San Tomas Technology Park from the date of acquisition.

3.   STOCK TRANSACTIONS

     During the six months ended June 30, 2003, stock options to purchase 60,362
     shares of common stock and 35,000 shares of common stock were  exercised at
     $4.50 and $8.25 per share, respectively. Total proceeds to the Company were
     approximately  $560. Two limited partners  exchanged 157,000 O.P. units for
     157,000  shares  of the  Company's  common  stock  under  the  terms of the
     December 1998 Exchange  Rights  Agreement among the Company and all limited
     partners of the operating partnerships.

4.   NET INCOME PER SHARE

     Basic  operating net income per share is computed by dividing net income by
     the weighted  average number of common shares  outstanding  for the period.
     Diluted  operating  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 using the
     treasury stock method.

                                     - 7 -

<PAGE>


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


                                                          Three Months Ended June 30,         Six Months Ended June 30,
                                                        -------------------------------    -------------------------------
                                                             2003              2002             2003              2002
                                                        --------------    -------------    --------------    -------------
<S>                                                       <C>              <C>               <C>              <C>
        Weighted average shares outstanding (basic)       17,701,999       17,464,692        17,669,808       17,434,796
        Incremental shares from assumed option exercise       60,774          438,161            58,830          443,687
                                                        --------------    -------------    --------------    -------------
        Weighted average shares outstanding (diluted)     17,762,773       17,902,853        17,728,638       17,878,483
                                                        ==============    =============    ==============    =============
</TABLE>

     The  outstanding  O.P. units,  which are  exchangeable at the unit holder's
     option,  subject to  certain  conditions,  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  calculation  after adding
     the  minority  interests'  share of income  back to net  income.  The total
     number of O.P.  units  outstanding at June 30, 2003 and 2002 was 86,498,064
     and 86,161,346, respectively.

5.   RELATED PARTY TRANSACTIONS

     As of June 30, 2003, the Berg Group owned  78,364,716 O.P. units.  The Berg
     Group's ownership as of June 30, 2003 represented  approximately 75% of the
     equity interests of the Company, assuming conversion of the 86,498,064 O.P.
     units outstanding into the Company's common stock.

     Effective  January 1, 2003, the Company and the Berg Group mutually  agreed
     to reduce the Berg Group  $100,000  line of credit to $20,000 and to reduce
     the  number of  properties  securing  the line of credit to five.  The Berg
     Group line of credit bears interest at LIBOR plus 1.30%, which was 2.42% as
     of June 30, 2003, and matures in March 2004. The Company  believes that the
     terms of the Berg  Group  line of  credit  are more  favorable  than  those
     available from commercial  lenders. As of June 30, 2003, debt in the amount
     of $4,185 was due the Berg Group under the line of credit,  and debt in the
     amount of $10,923 was due the Berg Group under a mortgage note  established
     May 15,  2000 in  connection  with the  acquisition  of a 50%  interest  in
     Hellyer  Avenue Limited  Partnership,  the obligor under the mortgage note.
     The  mortgage  note  bears  interest  at 7.65% and is due in ten years with
     principal payments amortized over 20 years.

     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 $1.00 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 May 2004.

     The Company currently leases office space owned by Berg & Berg Enterprises,
     Inc.,  an affiliate of Carl E. Berg and Clyde J. Berg.  Rental  amounts and
     overhead reimbursements paid to Berg & Berg Enterprises,  Inc. were $23 for
     each of the  three-month  periods  ended June 30, 2003 and 2002 and $45 for
     each of the six-month periods ended June 30, 2003 and 2002.

6.   COMMITMENTS AND CONTINGENCIES

     The Company and the operating  partnerships are or may become, from time to
     time,  parties to litigation  arising out of the normal course of business.
     Management  is not aware of any  litigation  against the Company that 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 losses
     from the  consequence  of terrorism or seismic  activity,  although they do
     cover losses from fires after an earthquake.

7.   DISCONTINUED OPERATIONS

     Effective  January 1, 2002,  the Company  adopted  Statement  of  Financial
     Accounting Standards No. 144, "Accounting for the Impairment or Disposal of
     Long Lived Assets," which addresses financial  accounting and reporting for
     the impairment  and disposal of long-lived  assets.  In general,  income or
     loss  attributable  to  the  operations  and  sale  of  property,  and  the
     operations   related  to  property  held  for  sale,   are   classified  as
     discontinued  operations  in the  statements  of  operations.  All  periods
     presented in this report will likely require  further  reclassification  in
     future periods if additional property sales occur.

     As of June 30, 2003,  there were no properties under contract to be sold or
     disposed of which would qualify as discontinued operations.

     In March 2002,  the Company  sold one  property for a total gain of $6,103,
     including   minority  interest  share  of  $5,087.   Condensed  results  of
     operations  for this property for the six months ended June 30, 2002 are as
     follows:

                                     - 8 -
<PAGE>
<TABLE>
<CAPTION>

                                             Six Months Ended
                                              June 30, 2002
                                           -------------------
                                               (Dollars in
                                                thousands)

<S>                                              <C>
         Rental income from real estate           $333
         Tenant reimbursements                     293
                                           -------------------
               Total revenues                      626

         Real estate taxes                         293
         Depreciation                               46
                                           -------------------
               Total expenses                      339
                                           -------------------
         Income before minority interests          287
                   Minority interests              239
                                           -------------------
                   Net income                      $48
                                           ===================
</TABLE>

8.   BUSINESS COMBINATIONS

     On April 9,  2003,  the  Company  acquired  San Tomas  Technology  Park for
     $110,000 in cash. The purchase price was allocated to long-lived assets and
     in-place leases, proportionate to the assets, respective fair market value.
     The  Company  recorded  an  intangible  asset of  $11,200 in  building  and
     improvements in the accompanying balance sheet for an in-place above market
     lease.  The intangible  asset will be amortized over six years, the life of
     the lease.  Amortization  expense of $472 was recorded for the three months
     ended June 30, 2003.

9.   SUBSEQUENT EVENTS

     On July 10, 2003,  the Company paid  dividends of $0.24 per share of common
     stock to all common stockholders of record as of June 30, 2003. On the same
     date, the operating partnerships paid a distribution of $0.24 per O.P. unit
     to all holders of O.P. units.

                                     - 9 -
<PAGE>


ITEM 2

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, 2002.  The
results  for the three and six months  ended June 30,  2003 are not  necessarily
indicative  of the  results to be  expected  for the entire  fiscal  year ending
December 31, 2003. 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

Mission West Properties,  Inc. (the "Company")  acquires,  markets,  leases, and
manages  R&D and office  properties,  primarily  located in the  Silicon  Valley
portion of the San Francisco  Bay Area.  As of June 30, 2003,  the Company owned
and managed 108 properties  totaling  approximately  7.8 million rentable square
feet through four limited partnerships, or operating partnerships,  for which it
is the sole general partner. This class of property is designed for research and
development  and  office  uses  and,  in some  cases,  includes  space for light
manufacturing  operations with loading docks.  The Company  believes that it has
one of the largest  portfolios of R&D  properties in the Silicon  Valley.  As of
June 30,  2003,  the five  tenants who leased the most square  footage  from the
Company were Microsoft Corporation, JDS Uniphase Corporation, Amdahl Corporation
(a subsidiary of Fujitsu  Limited),  Apple  Computer,  Inc., and NEC Electronics
America,  Inc. For federal  income tax  purposes,  the Company has operated as a
self-managed,  self-administered  and fully  integrated  real estate  investment
trust ("REIT") since fiscal 1999.

The  Company's  acquisition,  growth and  operating  strategy  incorporates  the
following elements:

-    working  with  the Berg  Group to take  advantage  of their  abilities  and
     resources  to pursue  development  opportunities  which the  Company has an
     option to acquire, on pre-negotiated terms, upon completion and leasing;

-    capitalizing   on   opportunistic   acquisitions   from  third  parties  of
     high-quality  R&D and office  properties  that provide  attractive  initial
     yields and significant potential for growth in cash-flow;

-    focusing on general  purpose,  single-tenant  Silicon Valley R&D and office
     properties for  information  technology  companies in order to maintain low
     operating costs, reduce tenant turnover and capitalize on our relationships
     with these  companies  and our  extensive  knowledge  of their real  estate
     needs; and

-    maintaining prudent financial management  principles that emphasize current
     cash flow while building  long-term  value,  the  acquisition of pre-leased
     properties to reduce  development  and leasing risks and the maintenance of
     sufficient liquidity to acquire and finance properties on desirable terms.

Effective  April 9, 2003, the Company  acquired seven R&D and office  properties
located  at the San  Tomas  Technology  Park in  Santa  Clara,  California.  The
acquisition   added   approximately   625,000  net  rentable   square  feet,  or
approximately 9%, to the Company's existing portfolio of properties.

CRITICAL ACCOUNTING POLICIES

The Company  prepares the consolidated  financial  statements in conformity with
GAAP,  which requires it to make certain  estimates,  judgments and  assumptions
that affect the  reported  amounts in the  accompanying  consolidated  financial
statements,   disclosure  of  contingent  assets  and  liabilities  and  related
footnotes.  Actual  results  may differ  from these  estimates  under  different
assumptions or conditions.

Critical  accounting  policies are defined as those that require  management  to
make  estimates,   judgments  and  assumptions,   giving  due  consideration  to
materiality,  in certain  circumstances  that  affect  amounts  reported  in the
consolidated   financial  statements,   and  potentially  result  in  materially
different  results  under  different  conditions  and  assumptions.  The Company
believes that the following best describe its critical accounting policies:

REAL  ESTATE  ASSETS.  Real  estate  assets  are stated at cost.  Cost  includes
expenditures  for  improvements  or  replacements.  Maintenance  and repairs are
charged to expense as  incurred.  Gains and losses  from sales are  included  in
income in accordance with Statement of Financial  Accounting  Standards ("SFAS")
No. 66, "Accounting for Sales of Real Estate."

The Company reviews real estate assets for impairment whenever events or changes
in  circumstances  indicate  that the  carrying  amount  of an asset  may not be
recoverable.  If  the  carrying  amount  of  the  asset  exceeds  its  estimated
undiscounted  net cash flow,  before  interest,  it will recognize an impairment
loss equal to the difference  between the carrying amount and the estimated fair
value.  If impairment is recognized,  the reduced  carrying  amount of the asset
will be accounted  for as its new cost.  For a depreciable  asset,

                                     - 10 -
<PAGE>

the new  cost  will be  depreciated  over the  asset's  remaining  useful  life.
Generally,  fair values are estimated using  discounted  cash flow,  replacement
cost or market  comparison  analyses.  The process of evaluating  for impairment
requires  estimates  as to future  events and  conditions,  which are subject to
varying  market and  economic  factors,  however.  Therefore,  it is  reasonably
possible that a change in estimate  resulting from judgments as to future events
could occur which would affect the recorded amounts of the property.

ALLOWANCE FOR DOUBTFUL ACCOUNTS AND RESERVE. The preparation of the consolidated
financial statements requires the Company to make estimates and assumptions.  As
such, it must make estimates of the  uncollectability of its accounts receivable
based on the evaluation of its tenants' financial position, analyses of accounts
receivable and current economic  trends.  The Company also makes estimates for a
straight-line  adjustment  reserve for existing  tenants  with the  potential of
bankruptcy  or  ceasing  operations.  Its  estimates  are based on the review of
tenants' payment histories,  publicly available  financial  information and such
additional  information about their financial condition as tenants provide them.
The  information  available  to  the  Company  might  lead  it to  overstate  or
understate these reserve amounts.  The use of different estimates or assumptions
could produce different results. Moreover, actual future collections of accounts
receivable  or  reductions  in  future  reported  rental  income  due to  tenant
bankruptcies  or  other  business  failures  could  differ  materially  from the
Company's estimates.

CONSOLIDATED JOINT VENTURES. The Company, through an operating partnership, owns
three properties that are in joint ventures in which the Company holds ownership
interests. The Company manages and operates all three properties.  The Company's
ownership of these  properties  and its portion of their  operating  results are
reflected on the Company's consolidated financial statements because the Company
owns a majority  interest,  exercises  significant  control over major operating
decisions,  and has operational and financial  control of the  investments.  The
Company makes judgments and assumptions  about the estimated monthly payments to
be made to its joint  venture  partners,  which are  reported  with its periodic
results of  operations.  Actual  results may differ from these  estimates  under
different assumptions or conditions.

INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES. The Company,  through an operating
partnership,   has  a  non-controlling   limited  partnership  interest  in  one
unconsolidated  joint venture.  This investment is not consolidated  because the
Company does not exercise significant control over major operating and financial
decisions. The Company accounts for the joint venture using the equity method of
accounting.

REVENUE RECOGNITION.  The Company recognizes rental revenue on the straight-line
method of  accounting  required by GAAP under  which  contractual  rent  payment
increases are recognized evenly over the lease term, regardless of when the rent
payments are received by the Company.  The difference  between recognized rental
income and rental cash  receipts  is  recorded  as deferred  rent on the balance
sheet.

Certain lease  agreements  contain terms that provide for additional rents based
on reimbursement of certain costs.  These additional rents are recognized on the
accrual basis.

Rental revenue is affected if existing tenants  terminate or amend their leases.
Thus,  if a tenant  lengthens  its lease  term,  additional  rental  revenue  is
recognized.  On the other hand, if a tenant  terminates  its lease  agreement or
shortens its lease term,  rental  revenue  decreases due to reduced  future cash
flows and a straight-line  adjustment to deferred rent,  which is the difference
between recognized rental income and rental cash receipts.  The Company tries to
identify tenants who may be likely to declare bankruptcy or cease operations. By
anticipating  these  events in  advance,  the  Company  expects to take steps to
minimize  their  impact on its  reported  results of  operations  through  lease
renegotiations,  adjustments to deferred rent, and other  appropriate  measures.
The Company's  judgments and estimations  about tenants' capacity to continue to
meet their lease obligations will affect the rental revenue recognized. Material
differences  may result in the amount and timing of our rental  revenue  for any
period if the Company made different judgments or estimations.


                                     - 11 -




<PAGE>


RESULTS OF OPERATIONS

COMPARISON  OF THE THREE AND SIX MONTHS ENDED JUNE 30, 2003 TO THE THREE AND SIX
MONTHS ENDED JUNE 30, 2002.

As of June 30,  2003,  the  Company,  through its  controlling  interests in the
operating partnerships,  owned 108 properties totaling approximately 7.8 million
square feet compared to 100 properties totaling approximately 7.0 million square
feet owned by the Company as of June 30, 2002. This represents a net increase of
approximately  11%  in  total  rentable  square  footage,   which  is  primarily
attributable to the Company's  acquisition of seven  properties at the San Tomas
Technology Park in Santa Clara,  California  consisting of approximately 625,000
net rentable square feet in April 2003.

Rental  revenues from  continuing  operations for the three and six months ended
June 30, 2003 compared to the three and six-month periods in 2002 as follows:

<TABLE>
<CAPTION>
                              Three Months Ended June 30,
                            ---------------------------------
                                                                                      % Change by         % of Total Net
                                2003               2002             $ Change         Property Group           Change
                            --------------     --------------     --------------     ---------------     -----------------
                                           (Dollars in thousands)

<S>                           <C>                <C>               <C>                  <C>                   <C>
   Same Property (1)           $27,735            $30,913           ($3,178)             (10.3%)               (9.7%)
   2002 Acquisitions (2)         2,523              1,840               683               37.1%                 2.1%
   2003 Acquisitions             2,936                  -             2,936                100%                 8.9%
                            --------------     --------------     --------------                         -----------------
                               $33,194            $32,753            $  441                1.3%                 1.3%
                            ==============     ==============     ==============                         =================


                               Six Months Ended June 30,
                            ---------------------------------
                                                                                      % Change by         % of Total Net
                                2003               2002             $ Change         Property Group           Change
                            --------------     --------------     --------------     ---------------     -----------------
                                           (Dollars in thousands)

   Same Property (1)           $56,584            $62,358           ($5,774)              (9.3%)               (8.9%)
   2002 Acquisitions (2)         5,106              2,880             2,226               77.3%                 3.4%

   2003 Acquisitions             2,936                  -             2,936                100%                 4.5%
                            --------------     --------------     --------------                         -----------------
                               $64,626            $65,238           ($  612)              (1.0%)               (1.0%)
                            ==============     ==============     ==============                         =================
</TABLE>

(1)  "Same Property" is defined as properties owned by the Company prior to 2002
     that the Company still owned as of June 30, 2003.
(2)  Operating  rental  revenues for 2002  Acquisitions do not reflect a full 12
     months of  operations  in 2002 because  these  properties  were acquired at
     various times during 2002.

RENTAL REVENUE FROM CONTINUING OPERATIONS
For the quarter ended June 30, 2003, rental revenues  increased by $0.4 million,
or 1.3%,  from $32.8  million for the three  months ended June 30, 2002 to $33.2
million for the same period of 2003. The net increase resulted from a decline of
($3.2) million in the Company's "Same Property"  portfolio,  an increase of $0.7
million from  properties  acquired in 2002, and an increase of $2.9 million from
properties  acquired in 2003.  Rental revenues  decreased by ($0.6) million from
$65.2  million for the six months  ended June 30, 2002 to $64.6  million for the
same period of 2003. Of the ($0.6) million decrease in rental  revenues,  ($5.7)
million resulted from the Company's "Same Property" portfolio, $2.2 million were
generated by  properties  acquired in 2002,  and $2.9 million were  generated by
properties acquired in 2003. The overall decline in rental revenues was a result
of  adverse  market  conditions  and the loss of  several  tenants  due to their
bankruptcy  or  cessation  of  operations  since June 30,  2002.  The  Company's
occupancy rate at June 30, 2003 was approximately 80%, compared to approximately
90% at June 30, 2002.

EQUITY IN EARNINGS FROM UNCONSOLIDATED JOINT VENTURE
As of June 30, 2003, the Company had investments in four R&D buildings, totaling
593,000 rentable square feet, through an unconsolidated  joint venture, in which
the  Company  acquired  a 50%  interest  in  January  2003.  The  Company  has a
non-controlling  limited  partnership  interest in this joint venture,  which it
accounts for using the equity method of  accounting.  For the three months ended
June 30, 2003, the Company  recorded equity in earnings from the  unconsolidated
joint venture of approximately $2.0 million,  including $1.4 million relating to
a gain from the sale of real estate by the unconsolidated joint venture. For the
six-month period ended June 30, 2003, equity in earnings from the unconsolidated
joint venture was approximately $2.8 million.

OTHER INCOME
Other income, including interest, increased to $0.6 million for the three months
ended June 30, 2003 from $0.3  million for the second  quarter of 2002.  For the
six months ended June 30, 2003 and 2002, other income,  including interest,  was
$1.3 million and $0.8 million, respectively. Utility rebate and security deposit
forfeitures  represented  most of the  increase.  The Company  does not consider
these transactions to be recurring items.

EXPENSES FROM CONTINUING OPERATIONS
Operating  expenses  and real  estate  taxes from  continuing  operations,  on a
combined  basis,  increased by $0.4 million,  or 8.2%, from $4.9 million to $5.3
million for the three months ended June 30, 2002 and 2003, respectively,  due to
the  acquisition  of the San Tomas  Technology  Park in April 2003. For the same
reason, tenant reimbursements from continuing operations  consistently increased
by $0.1 million,  or 2.0%, from $4.9 million for the three months ended June 30,
2002 to $5.0 million for the three months ended June

                                     - 12 -
<PAGE>

30, 2003.  The increase in tenant  reimbursements  was less than the increase in
operating  expenses and real estate taxes  because of lower  occupancy.  Certain
expenses such as property insurance, real estate taxes, and other fixed expenses
are not recoverable from vacant properties.

Depreciation and amortization expense of real estate from continuing  operations
increased by $0.9 million from $4.5 million to $5.4 million for the three months
ended June 30,  2002 and 2003,  respectively.  Of the $0.9  million  increase in
depreciation and amortization expense of real estate, approximately $0.5 million
represented  amortization expense of an intangible asset resulting from an above
market  in-place  lease  at  the  San  Tomas   Technology  Park  (see  note  8).
Depreciation  expense from continuing  operations increased by $1.2 million from
$8.8  million to $10.0  million for the six months ended June 30, 2002 and 2003,
respectively, primarily because of the newly acquired R&D and office properties.

Interest expense increased by $2.0 million,  or 83.3%, from $2.4 million for the
three months ended June 30, 2002 to $4.4 million for the three months ended June
30,  2003.  The  increase in interest  expense  resulted  from  additional  debt
obtained  by the  Company,  consisting  of a new  revolving  line of credit from
Cupertino  National  Bank put in place during the third quarter 2002, a new $100
million mortgage loan from  Northwestern  Mutual Life Insurance Company obtained
in early  January 2003,  and a new $80 million  mortgage loan from Citicorp USA,
Inc. obtained in early April 2003.  Interest expense (related parties) decreased
by $0.6 million, or 66.7%, from $0.9 million for the three months ended June 30,
2002 to $0.3  million  for the three  months  ended  June 30,  2003 due to lower
interest rates and the  repayments of the Berg Group line of credit.  Total debt
outstanding, including amounts due related parties, increased by $104.5 million,
or 45.2%,  from $231.4  million as of June 30, 2002 to $335.9 million as of June
30, 2003. As a result of the new debt, interest expense,  including amounts paid
to related  parties,  for the  quarter  ended June 30,  2003  increased  by $1.4
million  compared to the same  quarter a year ago because the new debt carries a
higher  interest  rate  than the  Berg  Group  line of  credit  which it  mainly
replaced.

Interest expense increased by $3.2 million,  or 69.6%, from $4.6 million for the
six months ended June 30, 2002 to $7.8 million for the six months ended June 30,
2003.  Interest expense (related parties)  decreased by $1.4 million,  or 73.7%,
from $1.9 million for the six months ended June 30, 2002 to $0.5 million for the
six months  ended June 30,  2003.  Overall  interest  expense for the six months
ended June 30, 2003  increased by $1.8 million  compared to the six months ended
June 30,  2002  with the  substitution  of new debt for the loan  under the Berg
Group line of credit.  Management  expects  interest  expense to increase as new
debt is incurred in connection with property acquisitions,  as the Company draws
on the  Cupertino  National  Bank  revolving  line of  credit,  and as it  seeks
alternative sources of credit.

NET INCOME TO MINORITY INTEREST AND NET INCOME TO COMMON STOCKHOLDERS
The minority interest portion of income increased by $0.1 million, or 0.5%, from
$20.8  million for the three months ended June 30, 2002 to $20.9 million for the
three months ended June 30, 2003. Net income to common stockholders increased by
$0.1  million,  or 2.4%,  from $4.1  million for the three months ended June 30,
2002 to $4.2 million for the same period in 2003.  For the six months ended June
30, 2003 and 2002, the minority interest portion of income was $41.2 million and
$46.9 million,  respectively,  resulting in net income to  stockholders  of $8.2
million and $9.3 million,  respectively. The decline in net income was primarily
due to reduced  rental  revenues  and  because  net income for the prior  year's
comparable period included gain from a sale of discontinued operations. Minority
interest  represents  the  ownership  interest  of all  limited  partners in the
operating  partnerships taken as a whole, which was approximately 83% as of June
30, 2003 and 2002.

RECENT DEVELOPMENTS

RENTAL MARKET  CONDITIONS.  All of the Company's  properties  are located in the
Northern  California area known as Silicon Valley,  which generally  consists of
portions of Santa Clara County,  Southwestern  Alameda County,  Southeastern San
Mateo  County and Eastern  Santa Cruz  County.  The Silicon  Valley  economy and
business  activity have slowed  markedly since 2001 after  fast-paced  growth in
1999  and  2000.  The  Silicon  Valley  R&D  property  market  has  historically
fluctuated with the local economy. According to a recent report by BT Commercial
Real  Estate,  vacancy  rates for Silicon  Valley R&D  property  increased  from
approximately 21.9% in late 2002 to 23.1% at the end of the second quarter 2003.
Total  vacant  R&D square  footage  in  Silicon  Valley at the end of the second
quarter of 2003  amounted to 35.6  million  square  feet,  of which 37%, or 13.1
million  square feet,  was being offered  under  subleases.  Total  negative net
absorption in 2002 amounted to approximately  (10.9) million square feet. During
the  first six  months of 2003,  there was  total  negative  net  absorption  of
approximately (3.8) million square feet. The impact of this decline has not been
uniform throughout the area, however. The Silicon Valley R&D property market has
been characterized by a substantial number of submarkets,  with rent and vacancy
rates varying by submarket and location within each submarket.

The  Company's  actual  occupancy  rate at June 30,  2003 was 80.2%,  which is a
significant  decline  from the  occupancy  rate of 90.3% at June 30,  2002.  The
Company  believes that its occupancy rate could decline further going forward if
key  tenants  seek  the  protection  of  the  bankruptcy   laws  or  discontinue
operations.  In addition,  leases with respect to approximately 145,000 rentable
square feet are expiring in the second half of 2003. The  properties  subject to
these leases may take anywhere from six to 12 months or longer to re-lease.  The
Company expects the average 2003 renewal rental rates for these properties to be
approximately  equal to, or  perhaps,  below  current  rents.  If the Company is
unable to lease a significant  portion of any vacant space or space scheduled to
expire; if the Company  experiences  significant  tenant defaults as a result of
the current economic  downturn;  or if the Company is not able to lease space at
or above current market rates,  its results of operations and cash flows will be
adversely affected. The Company's operating results and ability to pay dividends
at current  levels remain  subject to a number of material  risks,  as indicated
under the caption

                                     - 13 -
<PAGE>

"Forward-Looking  Information"  below and in the section entitled "Risk Factors"
in the Company's most recent annual report on Form 10-K.

RECENT PROPERTY ACQUISITIONS.  Effective January 1, 2003, the Company acquired a
50% interest in a joint  venture with TBI in Morgan  Hill,  California  for $1.8
million from the Berg Group under the Berg Land Holdings Option  Agreement.  The
Company  financed  the  acquisition  of its 50%  interest  with the  issuance of
181,032 O.P.  units to the Berg Group.  The joint  venture  consists of four R&D
buildings with  approximately  593,000  rentable square feet, which are operated
and managed by TBI,  the other  partner in the joint  venture.  The  property is
subject to secured loans of approximately  $53.6 million, of which the Company's
pro rata  share  of  unconsolidated  joint  venture  debt at June  30,  2003 was
approximately $26.6 million.

On April 1, 2003,  the  Company's  joint  venture  acquired a shell  building in
Morgan Hill,  California from the Berg Group under the Berg Land Holdings Option
Agreement.  The joint venture  financed 100% of the cost of the shell  building.
The shell building was sold on April 2, 2003 for cash. The Company  recognized a
gain of $1.4 million representing its share of the joint venture's profit.

On April 9, 2003,  the Company  acquired a 36-acre  seven-building  campus style
office/R&D  project  comprised of approximately  625,000 rentable square feet at
San Tomas and Central Expressway in Santa Clara,  California,  also known as the
San Tomas Technology Park. The San Tomas Technology Park was  approximately  90%
leased at the date of acquisition,  but one tenant,  which leases  approximately
98,000  rentable  square  feet,  has filed a  petition  under  Chapter 11 of the
Bankruptcy Code subsequent to the acquisition date. The project was acquired for
$110 million from BRE/San Tomas I LLC and BRE/San Tomas II LLC and financed with
a combination of approximately $100 million of new debt and cash reserves.

                                     - 14 -



<PAGE>


CHANGES IN FINANCIAL CONDITION

The most  significant  changes in  financial  condition  during the three months
ended June 30, 2003 resulted from the $110 million  acquisition of the San Tomas
Technology  Park.  Stockholders'  equity  increased  from the  exercise of stock
options and the exchange of O.P. units for common stock.

At June 30, 2003, real estate assets increased by  approximately  $110.5 million
from December 31, 2002 due to the San Tomas  Technology Park acquisition and new
tenant  improvements.  Of the $110.5  million  increase in real  estate  assets,
approximately  $11.2  million was  allocated  separately to an above market rent
lease.  In early 2003,  the Company  acquired a 50% interest in a joint  venture
from the Berg  Group  under the Berg Land  Holdings  Option  Agreement  for $1.8
million.  The Company  financed this  acquisition by issuing 181,032 O.P. units.
The joint venture consists of four buildings with  approximately  593,000 square
feet,  which are  operated  and managed by TBI,  the other  partner in the joint
venture.

At June 30, 2003, total  stockholders'  equity,  net, increased by approximately
$1.8 million from December 31, 2002 as the Company obtained  additional  capital
from stock option  exercises  and the exchange of O.P.  units for the  Company's
common stock while incurring a deficit of ($0.3) million.  During the six months
ended June 30, 2003,  stock  options to purchase  60,362  shares of common stock
were exercised at $4.50 per share,  and stock options to purchase  35,000 shares
of common stock were exercised at $8.25 per share. Total proceeds to the Company
were  approximately  $0.6  million.  During  the first six  months of 2003,  two
limited  partners  exchanged  157,000  O.P.  units  for  157,000  shares  of the
Company's common stock under the Exchange Rights Agreement among the Company and
the limited  partners in the  operating  partnerships.  The newly issued  shares
increased additional paid in capital by approximately $2.1 million.

LIQUIDITY AND CAPITAL RESOURCES

The Company  expects its  principal  sources of liquidity for  distributions  to
stockholders and unit holders,  debt service,  leasing commissions and recurring
capital  expenditures  to come from  operations  and/or  the Berg  Group line of
credit and other credit  facilities  that may be established by the Company with
third  party  financial  institutions.  The  Company  expects  these  sources of
liquidity to be adequate to meet projected  distributions  to  stockholders  and
other presently  anticipated  liquidity  requirements during the next 12 months.
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  short-term  obligations or other  liquidity  needs based on the
Berg Group and Cupertino  National Bank revolving  lines of credit.  Despite the
current  weakness  in the  economy,  the  Company  expects  interest  expense to
increase,  but not significantly,  as it incurs debt through acquisitions of new
properties and as interest rates increase.

On January 9, 2003, the Company  obtained a $100 million  secured  mortgage loan
from Northwestern Mutual Life Insurance Company ("Northwestern Loan") that bears
a fixed interest rate at 5.64% and matures in ten years with principal  payments
amortized  over 20 years.  The mortgage  loan is secured by 11  properties.  The
Company paid  approximately  $675,000 in loan fees and financing  costs and used
the proceeds to primarily  pay down  short-term  debt and the Berg Group line of
credit.

On April 9, 2003, the Company obtained an $80 million  short-term  mortgage loan
from Citicorp USA, Inc.  ("Citicorp  Loan") that bears interest at LIBOR plus 2%
and matures in April 2004. The Company paid $200,000 in financing costs and used
the proceeds to acquire the San Tomas  Technology  Park  property.  The original
loan term was 120 days,  but the  Company and  Citicorp  USA,  Inc.  agreed to a
nine-month loan term extension in June 2003.

On July 10, 2003,  the Company paid dividends of $0.24 per share of common stock
to all common  stockholders of record as of June 30, 2003. On the same date, the
operating partnerships paid a distribution of $0.24 per O.P. unit to all holders
of O.P. units.

At June 30,  2003,  the  Company  had  total  indebtedness  of  $335.9  million,
including  $302.4 million of fixed rate mortgage  debt,  $10.9 million under the
Berg Group  mortgage note (related  parties),  $18.4 million under the Cupertino
National  Bank line of  credit,  and $4.2  million  under the Berg Group line of
credit (related parties), as detailed in the table below:

                                     - 15 -

<PAGE>


Mortgage Debt

The following table sets forth information regarding debt outstanding as of June
30, 2003:

<TABLE>
<CAPTION>

                                                                                                              Maturity     Interest
                Debt Description                       Collateral Properties                 Balance            Date         Rate
---------------------------------------------  --------------------------------------  --------------------  -----------  ----------
                                                                                      (Dollars in thousands)
<S>                                           <C>                                          <C>                 <C>         <C>
Line of Credit:
Berg Group (related parties)                   2033-2043 Samaritan Drive, San Jose, CA      $  4,185             3/04          (1)
                                               2133 Samaritan Drive, San Jose, CA      --------------------
                                               2233-2243 Samaritan Drive, San Jose, CA
                                               1310-1450 McCandless Drive, Milpitas, CA
                                               1795-1845 McCandless Drive, Milpitas, CA

Cupertino National Bank                        Not Applicable                                 18,431             7/04          (3)
                                                                                       --------------------

Mortgage Notes Payable (related parties):      5300 & 5350 Hellyer Avenue, San Jose, CA       10,923             6/10       7.650%
                                                                                       --------------------
Mortgage Notes Payable:
Prudential Capital Group                       20400 Mariani Avenue, Cupertino, CA               849            10/06       8.750%
Washington Mutual(Home Savings & Loan Assoc.)  10460 Bubb Road, Cupertino, CA                    262            12/06       9.500%
Prudential Insurance Company of America (2)    10300 Bubb Road, Cupertino, CA                122,414            10/08       6.560%
                                               10500 N. De Anza Boulevard, Cupertino, CA
                                               4050 Starboard Drive, Fremont, CA
                                               45700 Northport Loop, Fremont, CA
                                               45738 Northport Loop, Fremont, CA
                                               450-460 National Avenue, Mountain View, CA
                                               6311 San Ignacio Avenue, San Jose, CA
                                               6321 San Ignacio Avenue, San Jose, CA
                                               6325 San Ignacio Avenue, San Jose, CA
                                               6331 San Ignacio Avenue, San Jose, CA
                                               6341 San Ignacio Avenue, San Jose, CA
                                               6351 San Ignacio Avenue, San Jose, CA
                                               3236 Scott Boulevard, Santa Clara, CA
                                               3560 Bassett Street, Santa Clara, CA
                                               3570 Bassett Street, Santa Clara, CA
                                               3580 Bassett Street, Santa Clara, CA
                                               1135 Kern Avenue, Sunnyvale, CA
                                               1212 Bordeaux Lane, Sunnyvale, CA
                                               1230 E. Arques, Sunnyvale, CA
                                               1250 E. Arques, Sunnyvale, CA
                                               1170 Morse Avenue, Sunnyvale, CA
                                               1600 Memorex Drive, Santa Clara, CA
                                               1688 Richard Avenue, Santa Clara, CA
                                               1700 Richard Avenue, Santa Clara, CA
                                               3540 Bassett Street, Santa Clara, CA
                                               3542 Bassett Street, Santa Clara, CA
                                               3544 Bassett Street, Santa Clara, CA
                                               3550 Bassett Street, Santa Clara, CA

Northwestern Mutual Life Insurance Company     1750 Automation Parkway, San Jose, CA          98,827             1/13       5.640%
                                               1756 Automation Parkway, San Jose, CA
                                               1762 Automation Parkway, San Jose, CA
                                               6320 San Ignacio Avenue, San Jose, CA
                                               6540-6541 Via Del Oro, San Jose, CA
                                               6385-6387 Via Del Oro, San Jose, CA
                                               2251 Lawson Lane, Santa Clara, CA
                                               1325 McCandless Drive, Milpitas, CA
                                               1650-1690 McCandless Drive, Milpitas, CA
                                               20605-20705 Valley Green Drive, Cupertino, CA

Citicorp USA, Inc.                             2001 Walsh Avenue, Santa Clara, CA             80,000             4/04          (3)
                                               2880 Scott Boulevard, Santa Clara, CA
                                               2890 Scott Boulevard, Santa Clara, CA
                                               2770-2800 Scott Boulevard, Santa Clara, CA
                                               2300 Central Expressway, Santa Clara, CA
                                               2220 Central Expressway, Santa Clara, CA
                                               2330 Central Expressway, Santa Clara, CA
                                                                                       --------------------
Mortgage Notes Payable Subtotal                                                              302,352
                                                                                       --------------------

TOTAL                                                                                       $335,891
                                                                                       ====================
</TABLE>


(1)  The debt owed to the Berg Group under the line of credit carries a variable
     interest  rate  equal to LIBOR  plus  1.30% and is payable in full in March
     2004. The interest rate at June 30, 2003 was 2.42%.
(2)  John Kontrabecki, one of the limited partners, has guaranteed approximately
     $12,000 of this debt.
(3)  Interest rate equal to LIBOR plus 2%. The interest  rates for the Cupertino
     National Bank line of credit and the Citicorp  USA,  Inc.  mortgage loan at
     June 30, 2003 were 3.32% and 3.29%, respectively.

                                     - 16 -

<PAGE>


As of June 30, 2003, the Company's debt to total market capitalization ratio was
approximately  22.1%, based upon a total market  capitalization of approximately
$1.5 billion.  The Company  computed this ratio by dividing the Company's  total
debt  outstanding  as of June 30,  2003 by the sum of this debt plus the  market
value of common stock (based upon the closing  price of $11.37 per share on June
30, 2003) on a fully diluted  basis,  taking into account the  conversion of all
O.P. units into common stock.

HISTORICAL CASH FLOWS

Net cash provided by operating activities for the six months ended June 30, 2003
was $61.1  million  compared to $64.7  million for the same period in 2002.  The
decline resulted from the decrease in rental revenue from the Company's  current
portfolio of property due to tenant lease  obligation  defaults  during 2002 and
2003.

Net cash used in investing  activities was  approximately  ($109.6)  million and
($19.8)  million for the six months ended June 30, 2003 and 2002,  respectively.
Of the ($109.6)  million net cash used in investing  activities,  ($110) million
was used to  acquire  the San  Tomas  Technology  Park  property,  $1.4  million
received from the sale of joint  venture real estate,  and ($1) million was used
for tenant improvements and new equipment.

Net cash provided by financing  activities  was $46.8 million for the six months
ended June 30, 2003 compared to ($44.4) million used in financing activities for
the  same  period  in  2002.  Of the  $46.8  million  net  cash  from  financing
activities,  ($82.9) million was used to pay outstanding  debt,  ($41.6) million
for minority  interest  distributions,  and ($8.4)  million for  dividends.  The
Company  obtained  approximately  $180 million from  financing  activity,  which
included the Northwestern Loan and Citicorp Loan and related financing costs, as
well as proceeds from the exercise of stock options.

CAPITAL EXPENDITURES

The Company's  existing R&D properties  require periodic  investments of capital
for tenant-related  capital  expenditures and for general capital  improvements.
For the years ended  December 31, 1997 through  December 31, 2002, the recurring
tenant  improvement costs and leasing  commissions  incurred with respect to new
leases and lease  renewals of the  properties  that were owned or  controlled by
members of the Berg Group  prior to July 1, 1998  averaged  approximately  $1.75
million annually.  The Company expects that the average annual cost of recurring
tenant improvements and leasing commissions,  related to the properties, will be
approximately  $2.0 million  during 2003.  The Company  believes it will recover
substantially  all of these sums from the  tenants  under 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

The  Company's  principal  performance  measurements  are net  income  to common
stockholders and earnings per share computed in accordance with GAAP. Management
considers Funds From Operations ("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 is a  non-GAAP  financial  measurement  used by real
estate  investment  trusts to measure  and  compare  operating  performance.  As
defined by the National Association of Real Estate Investment Trusts ("NAREIT"),
FFO  represents  net income  (loss)  before  minority  interest of unit  holders
(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,  amortization
of commission and depreciation of non-real estate assets) and after  adjustments
for unconsolidated partnerships and joint ventures. 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.  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  and six  months  ended  June  30,  2003 and  2002,  as
reconciled to net income to common  stockholders,  are  summarized in the tables
below:

                                     - 17 -
<PAGE>


<TABLE>
<CAPTION>

                                                    Three Months Ended June 30,                    Six Months Ended June 30,
                                              -----------------------------------------     ----------------------------------------
                                                    2003                   2002                   2003                   2002
                                              ------------------     ------------------     ------------------     -----------------
                                                       (Dollars in thousands)                        (Dollars in thousands)
<S>                                             <C>                    <C>                    <C>                    <C>
Net income to common stockholders                $ 4,156                $ 4,073                $ 8,190                $ 9,273
Add:
    Minority interests (1)                        20,799                 20,671                 40,856                 46,605
    Depreciation and amortization (2)              5,397                  4,455                  9,961                  8,857
Less:
    Gain on sale of JV assets / assets            (1,400)                     -                 (1,400)                (6,103)
                                              ------------------     ------------------     ------------------     -----------------
Funds From Operations                            $28,952                $29,199                $57,607                $58,632
                                              ==================     ==================     ==================     =================
</TABLE>

(1)  Excludes minority interest for unrelated parties.
(2)  Includes  depreciation  of real estate  from  discontinued  operations  and
     amortization  expense of costs allocated to above market leases in property
     acquisitions.

DISTRIBUTION POLICY

The  Company's  board of  directors  will  determine  the  amount  and timing of
distributions  to our  stockholders.  The board of directors  will consider many
factors prior to making any distributions, including the following:

-    the amount of cash available for distribution;

-    the Company's financial condition;

-    whether to reinvest funds rather than to distribute such funds;

-    the Company's committed and projected capital expenditures;

-    the  amount  of cash  required  for new  property  acquisitions,  including
     acquisitions under existing agreements with the Berg Group;

-    prospects  of tenant  renewals  and  re-leases  of  properties  subject  to
     expiring leases;

-    cash required for re-leasing activities;

-    the  annual  distribution  requirements  under the REIT  provisions  of the
     federal income tax laws; and

-    such other factors as the board of directors deems relevant.

The  Company  cannot  assure  you  that it  will  be  able  to meet or  maintain
management's cash distribution objectives.


                                     - 18 -

<PAGE>


IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS

The  Company  does  not  believe  recently  issued  accounting   standards  will
materially impact its financial statements.

In January 2003,  the FASB  Interpretation  No. 46,  "Consolidation  of Variable
Interest Entities - an interpretation of ARB No. 15" ("FIN 46"). FIN 46 requires
that any  entity  meeting  certain  rules and  relation  to a  company's  equity
investment  risk and level of  financial  control  be  considered  as a variable
interest entity.  The statement is applicable to all variable  interest entities
created or  acquired  after  January  31,  2003,  and the first  interim  period
beginning  after June 15,  2003,  for  variable  interest  entities in which the
Company holds a variable  interest that is acquired before February 1, 2003. The
Company  plans  on  adopting  FIN 46 in  the  time  frames  as  required  by the
statement.   Management  expects  no  significant  effect  on  the  consolidated
financial  position,  results of  operations  or cash flows of the  Company as a
result of the initial  adoption of this standard in regard to existing  variable
interest  entities;  however,  newly  formed  entities  in 2003 could meet these
requirements and will be recorded as appropriate.


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  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.  Additionally,  all  disclosures
under Part I.,  Item 3  constitute  forward-looking  statements.  The  Company's
ability to predict results or the actual effect of future plans or strategies is
inherently uncertain.

Factors that could have a material  adverse  effect on the operations and future
prospects of the Company include, but are not limited to, the following:

-    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 R&D,  office and  industrial  properties  in the
     Company's current and proposed market areas,
-    tenant defaults and bankruptcies,
-    lease term expirations and renewals, and
-    general accounting principles, policies and guidelines applicable to REITs.

In addition, the actual timing of development,  construction, and leasing on any
projects  that the Company  believes it may acquire in the future under the Berg
Land Holdings Option Agreement is unknown presently,  and reliance should not be
placed  on  the   estimates   concerning   these   projects.   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.

                                     - 19 -

<PAGE>


ITEM 3
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We do not generally hold market risk sensitive instruments for trading purposes.
We use fixed and variable rate debt to finance our  operations.  Our exposure to
market risk for changes in interest  rates relates  primarily to our current and
future debt  obligations.  We are  vulnerable  to  significant  fluctuations  of
interest  rates on our  floating  rate debt and pricing on our future  debt.  We
manage our market risk by  monitoring  interest  rates where we try to recognize
the  unpredictability  of the financial  markets and seek to reduce  potentially
adverse effect on the results of our operations.  This takes frequent evaluation
of available  lending rates and examination of  opportunities to reduce interest
expense  through new sources of debt financing.  Several  factors  affecting the
interest rate risk include governmental monetary and tax policies,  domestic and
international  economics  and other  factors  that are beyond our  control.  The
following table provides  information  about the principal cash flows,  weighted
average interest rates,  and expected  maturity dates for debt outstanding as of
June 30,  2003.  The  current  terms  of this  debt  are  described  in Item 2.,
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations - Liquidity and Capital Resources."

For variable rate debt, the table presents the assumption  that the  outstanding
principal balance at June 30, 2003 will be paid upon maturity.

For fixed rate debt,  the table  presents the  assumption  that the  outstanding
principal balance at June 30, 2003 will be paid according to scheduled principal
payments and that we will not prepay any of the outstanding principal balance.
<TABLE>
<CAPTION>


                                                2003       2004       2005      2006      2007   Thereafter    Total   Fair Value
                                                ----       ----       ----      ----      ----   ----------    -----   ----------
<S>                                          <C>      <C>          <C>       <C>       <C>       <C>        <C>        <C>
VARIABLE RATE DEBT:                                                         (dollars in thousands)
   Secured debt                                        $102,616                                              $102,616   $102,616
   Weighted average interest rate                         3.27%

FIXED RATE DEBT:
   Secured notes payable                      $2,656     $5,612     $5,977    $6,245    $6,350    $206,436   $233,275   $258,636
   Weighted average interest rate              6.23%      6.23%      6.23%     6.23%     6.23%       6.23%
</TABLE>

The  primary  market  risk we face is the risk of  interest  rate  fluctuations.
Principal amounts outstanding under the Berg Group line of credit, the Cupertino
National Bank line of credit and the Citicorp USA, Inc. mortgage loan, which are
tied to a LIBOR based  interest rate,  were  approximately  $4.2 million,  $18.4
million, and $80.0 million, or 1.3%, 5.5% and 23.8%, respectively,  of the total
$335.9  million of  outstanding  debt as of June 30, 2003.  As a result,  we pay
lower rates of interest in periods of decreasing interest rates and higher rates
of  interest  in  periods  of  increasing  interest  rates.  All of the  debt is
denominated in United States  dollars.  We had no interest rate caps or interest
rate swap contracts at June 30, 2003.

The  following  discussion  of  market  risk  is  based  solely  on  a  possible
hypothetical  change in future market  conditions  related to our  variable-rate
debt. It includes "forward-looking statements" regarding market risk, but we are
not forecasting the occurrence of these market changes.

Based on the amount of  variable  debt  outstanding  as of June 30,  2003,  a 1%
increase or decrease in interest  rates on our $102.6  million of floating  rate
debt would  decrease or  increase,  respectively,  six months  earnings and cash
flows by approximately  $0.5 million,  as a result of the increased or decreased
interest  expense  associated  with the  change  in rate,  and would not have an
impact on the fair value of the floating rate debt. This amount is determined by
considering the impact of hypothetical interest rates on our borrowing cost. Due
to the uncertainty of  fluctuations  in interest rates and the specific  actions
that might be taken by us to mitigate of such  fluctuations  and their  possible
effects, the foregoing  sensitivity analysis assumes no changes to our financial
structure.

ITEM 4
CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE  CONTROLS AND PROCEDURES.  The Company has conducted an
evaluation,  under the supervision and with the  participation  of the Company's
management,  including the Company's Chief Executive Officer, President and Vice
President of Finance,  of the  effectiveness  of the design and operation of the
Company's  disclosure  controls  and  procedures  pursuant to Exchange  Act Rule
13a-14c. Base upon that evaluation,  the Chief Executive Officer,  President and
Vice President of Finance concluded that the Company's  disclosure  controls and
procedures  are  effective  in  timely  alerting  them to  material  information
relating to the Company (including its subsidiaries)  required to be included in
the Company's periodic SEC filings.

CHANGES IN INTERNAL CONTROLS.  There were no significant changes in our internal
controls or to our knowledge,  in other factors that could significantly  affect
such internal controls subsequent to the date of their evaluation.

                                     - 20 -
<PAGE>



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

PART II - OTHER INFORMATION

ITEM 4
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

a)   The annual meeting of  stockholders of the Company was held on May 21, 2003
     in which proxies representing  14,717,323 shares of common stocks, or 83.4%
     of the total outstanding shares, voted.

b)   At the  annual  meeting of  stockholders,  Carl E.  Berg,  John C.  Bolger,
     William A. Hasler,  Lawrence B. Helzel,  and Raymond V. Marino were elected
     as directors for the ensuing year, all of whom were serving on the board of
     directors at the time of the meeting.

c)   The following proposals were voted upon at the meeting:

     Proposal No. 1: Election of Directors

<TABLE>
<CAPTION>

                                                              Total Vote Against
                                  Total Vote for Each       or Withheld from Each
    Directors                          Director                   Director              Total Abstentions
    ---------------------------- ----------------------     ----------------------    ----------------------

<S>                                  <C>                         <C>                        <C>
    Carl E. Berg                      12,865,431                  1,688,937                  162,955
    John C. Bolger                    14,553,529                     839                     162,955
    William A. Hasler                 14,553,195                    1,173                    162,955
    Lawrence B. Helzel                14,554,029                     339                     162,955
    Raymond V. Marino                 12,865,965                  1,688,403                  162,955

</TABLE>


     Proposal No. 2:  Ratification  of the selection of  PricewaterhouseCoopers,
     LLP as independent  public  accountants for the Company for the year ending
     December 31, 2003.  There were  14,629,481  votes in favor of the proposal,
     56,049 votes against the proposal, and 31,793 abstentions.

ITEM 6
EXHIBITS AND REPORTS ON FORM 8-K

     a.   Exhibits

          10.27.1  Amendment to Berg Group $100,000,000 Line of Credit
          10.45.1  Citicorp USA, Inc. Promissory Note Extension
          31.1     Section 1350 Certificate of CEO
          31.2     Section 1350 Certificate of principal financial officer
          32       Certification pursuant to Section 906 of the Sarbanes-Oxley
                   Act of 2002

     b.   Reports on Form 8-K

          The Company  filed an amendment to Current  Report on Form 8-K on June
          20, 2003,  regarding its acquisition of the San Tomas Technology Park.
          On April 23,  2003,  the Company  filed a Current  Report on Form 8-K,
          regarding its acquisition of the San Tomas Technology Park on April 9,
          2003 and its results of  operations  and  financial  condition for the
          first quarter of 2003.

                                     - 21 -
<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:   August 12, 2003              By:    /s/ Carl E. Berg
                                     -------------------------------------------
                                     Carl E. Berg
                                     Chief Executive Officer


Date:   August 12, 2003              By:    /s/ Wayne N. Pham
                                     -------------------------------------------
                                     Wayne N. Pham
                                     Vice President of Finance and Controller
                                     (Principal Accounting Officer and Duly
                                     Authorized Officer)

                                     - 22 -

<PAGE>