##### Table of Contents






















x ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d)


OF THE SECURITIES EXCHANGE ACT OF 1934






o TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d)


OF THE SECURITIES EXCHANGE ACT OF 1934









(Exact name of registrant as specified in its charter)


|                                                                                                     |  |                                     
|---------------------------------------------------------------------------------------------------- |  | ------------------------------------
|Maryland                                                                                             |  | 36-4151656                          
|(State or other jurisdiction of incorporation or
    organization)                                   |  | (I.R.S. Employer Identification No.)
|Two North Riverside Plaza,
    Suite 2100, Chicago, Illinois(Address of principal executive offices) |  | 60606(Zip Code)                     

Registrants telephone number, including area
code (312) 466-3300




|                                                                       |  |                                          
|---------------------------------------------------------------------- |  | -----------------------------------------
|Title of each class                                                    |  | Name of each exchange on which registered
|                                                                       |  |                                          
|Common Shares of Beneficial Interest,
    $.01 par value per share     |  | New York Stock Exchange                  
|5.25% Series B Convertible,
    Cumulative Redeemable Preferred Shares |  | New York Stock Exchange                  
|7.75% Series G Cumulative Redeemable
    Preferred Shares              |  | New York Stock Exchange                  





x o


o


x o






DOCUMENTS INCORPORATED BY REFERENCE












---










EQUITY OFFICE PROPERTIES TRUST


TABLE OF CONTENTS


|                                                                                                   |  |                                                                                                                      |  |      |     | 
|-------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------- |  | ---- | --- | 
|                                                                                                   |  |                                                                                                                      |  | Page |    
|                                                                                                   |  |                                                                                                                      |  |      |    
|                                                                                                   |  | Forward-Looking Statements and Risk
    Factors                                                                      |  |      | 3   | 
|PART I.                                                                                           
|Item 1.                                                                                            |  | Business                                                                                                             |  |      | 4   | 
|Item 2.                                                                                            |  | Properties                                                                                                           |  |      | 12  | 
|Item 3.                                                                                            |  | Legal Proceeding                                                                                                     |  |      | 17  | 
|Item 4.                                                                                            |  | Submission of Matters to a Vote of Security
    Holders                                                              |  |      | 17  | 
|PART II.                                                                                          
|Item 5.                                                                                            |  | Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities |  |      | 18  | 
|Item 6.                                                                                            |  | Selected Financial Data                                                                                              |  |      | 19  | 
|Item 7.                                                                                            |  | Managements Discussion and Analysis
    of Financial Condition and Results of Operations                            |  |      | 20  | 
|Item 7A.                                                                                           |  | Quantitative and Qualitative Disclosures
    about Market Risk                                                       |  |      | 50  | 
|Item 8.                                                                                            |  | Financial Statements and Supplementary
    Data                                                                      |  |      | 51  | 
|Item 9.                                                                                            |  | Changes in and Disagreements With
    Accountants on Accounting and Financial Disclosure                             |  |      | 105 | 
|Item 9A.                                                                                           |  | Controls and Procedures                                                                                              |  |      | 105 | 
|Item 9B.                                                                                           |  | Other Information                                                                                                    |  |      | 105 | 
|PART III.                                                                                         
|Item 10.                                                                                           |  | Directors and Executive Officers of the
    Registrant                                                               |  |      | 106 | 
|Item 11.                                                                                           |  | Executive Compensation                                                                                               |  |      | 106 | 
|Item 12.                                                                                           |  | Security Ownership of Certain Beneficial
    Owners and Management and Related Stockholder Matters                   |  |      | 106 | 
|Item 13.                                                                                           |  | Certain Relationships and Related
    Transactions                                                                   |  |      | 106 | 
|Item 14.                                                                                           |  | Principal Accountant Fees and Services                                                                               |  |      | 106 | 
|PART IV.                                                                                          
|Item 15.                                                                                           |  | Exhibits and Financial Statement
    Schedules                                                                       |  |      | 107 | 
|Third Amended and Restated Supplemental Retirement Savings Plan                                   
|Second Amended and Restated 1997 Non-Qualified Employee Share Purchase Plan                       
|First Amendment to the Second Amended and Restated 1997 Non-Qualified Employee Share Purchase Plan
|Credit Agreement                                                                                  
|List of Subsdiaires                                                                               
|Consent of Independent Auditors                                                                   
|Rule 13a-14(a)/15d-14(a) Certifications                                                           
|Section 1350 Certifications                                                                       
|1997 Non-Qualified Employee Share Purchase Plan                                                   



2



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##### Table of Contents






FORWARD-LOOKING STATEMENTS AND RISK FACTORS








3



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##### Table of Contents






PART I







|        |          
|------- | ---------
|Item 1. | Business.

EQUITY OFFICE










Office Properties




4



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##### Table of Contents





|                              |       |           |     |                        |             |  |                            |             |  |  |             |             |  |             |            |             |  |  |            |             | 
|----------------------------- | ----- | --------- | --- | ---------------------- | ----------- |  | -------------------------- | ----------- |  |  | ----------- | ----------- |  | ----------- | ---------- | ----------- |  |  | ---------- | ----------- | 
|                              |       |           |     | Total Office Portfolio |             |  | Effective Office Portfolio |            
|                              |       |           |     |                        |             |  |                            |            
|                              |       | Number of |     |                        |             |  | Occupied                   |             |  |  |             | Occupied    | 
|                              |       | Buildings |     |                        | Square Feet |  |                            | Square Feet |  |  | Square Feet |             |  | Square Feet |           
|                              |       |           |     |                        |             |  |                            |             |  |  |             |             |  |             |           
|Consolidated Properties       |       |           | 627 |                        |             |  | 97,230,042                 |             |  |  | 84,332,477  |             |  |             | 97,230,042 |             |  |  | 84,332,477 |            
|Consolidated Joint Ventures   |       |           | 29  |                        |             |  | 13,059,313                 |             |  |  | 12,329,844  |             |  |             | 11,824,969 |             |  |  | 11,184,688 |            
|Unconsolidated Joint Ventures |       |           | 42  |                        |             |  | 15,423,890                 |             |  |  | 13,615,105  |             |  |             | 6,224,732  |             |  |  | 5,347,249  |            
|                              |       |           |     |                        |             |  |                            |             |  |  |             |             |  |             |           
|                              | Total |           |     | 698                    |             |  |                            | 125,713,245 |  |  |             | 110,277,426 |  |             |            | 115,279,743 |  |  |            | 100,864,414 | 
|                              |       |           |     |                        |             |  |                            |             |  |  |             |             |  |             |           
|Occupancy                     |       |           |     |                        |             |  |                            |             |  |  | 87.7        | %           |  |             |            |             |  |  | 87.5       | %          
|                              |       |           |     |                        |             |  |                            |             |  |  |             |             |  |             |           

KEY TRANSACTIONS COMPLETED IN 2004


Investing Activities




| |   |                                                                                                                                                                                                                    
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We acquired $952.0 million in assets, or partial interests
    therein, consisting of 27 office properties comprising
    approximately 3.3 million square feet and four vacant land
    parcels;                  
|
| |  | disposed of five office properties, comprising approximately
    .6 million square feet, and partial interests in three
    office properties, and one vacant land parcel for approximately
    $252.2 million;    
|
| |  | disposed of 71 industrial properties, which constituted
    substantially our entire industrial property portfolio,
    comprising approximately 5.1 million square feet, for
    approximately $432.0 million; and
|
| |  | disposed of our investment in shares of Capital Trust for
    approximately $32.1 million.                                                                                                                         

Financing Activities




| |     
| | ----
| | Debt



| |   |                                                                                                                                                                                                                         
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We issued approximately $1.8 billion of fixed interest rate
    unsecured notes and $245 million of variable interest rate
    unsecured notes in several offerings, and repaid
    $1.2 billion of unsecured notes; and
|
| |  | repaid approximately $444.3 million of mortgage debt.                                                                                                                                                                   



| |            
| | -----------
| | Derivatives



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We settled $800 million of forward-starting interest rate
    swaps for a payment of approximately $69.1 million and then
    entered into several fixed-to-floating interest rate swaps that
    effectively converted the 5.54% fixed interest rate on
    $1.0 billion of unsecured notes issued in March 2004 to a
    floating rate of LIBOR plus 122 basis points (which
    includes 79 basis points for loan costs); and
|
| |  | settled five forward-starting interest rate swaps with a
    combined notional amount of $500 million resulting in a
    gain of approximately $24.0 million. The swaps were entered
    into in 2003 to hedge an unsecured notes offering that was
    expected to take place in June 2004, but did not occur.                                                                                                                 



| |      
| | -----
| | Other



| |   |                                                                                                                                        
| | - | ---------------------------------------------------------------------------------------------------------------------------------------
| |  | We recorded a non-cash impairment charge of approximately
    $229.2 million on 46 non-core assets;                                    
|
| |  | redeemed our
    85/8%
    Series C Cumulative Redeemable Preferred Shares of
    Beneficial Interest for approximately $114.1 million;

5



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##### Table of Contents





| |   |                                                                                                                                                                                                                                                                                           
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | consolidated the assets, liabilities and results of operations
    of the SunAmerica Center office property as of January 1,
    2004 in accordance with FIN 46(R) and recognized a
    cumulative effect of a change in accounting principle loss of
    approximately $33.7 million; and
|
| |  | consolidated the assets, liabilities and results of operations
    of the Concar office property in accordance with FIN 46(R).                                                                                                                                                            

BUSINESS STRATEGY








| |   |                                                                                                                                                                                                                                      
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | increasing occupancy by leasing vacant space and retaining
    tenants on economically attractive terms, reducing lease cycle
    time and improving customer service;                                                               
|
| |  | concentrating capital in our core markets where we believe we
    can best position ourselves to maximize value and generate
    long-term attractive returns;                                                                       
|
| |  | taking advantage of favorable market opportunities to exit
    non-core markets and to dispose selectively of properties, or
    interests therein, in certain of our core markets that do not
    fit within our long-term strategy;
|
| |  | achieving economies of scale over time; and                                                                                                                                                                                          
|
| |  | taking advantage of our recently implemented portfolio-wide
    operating structure.                                                                                                                                                 

ACQUISITION AND DISPOSITION ACTIVITY




|     |       |                       |         |          |              |   |         |         | 
|---- | ----- | --------------------- | ------- | -------- | ------------ | - | ------- | ------- | 
|Year |       | Acquisitions          |         |          | Dispositions |  
|     |       |                       |         |          |              |  
|     |       | (Dollars in millions) |        
|2004 |       | $                     | 952.0   |          |              | $ | 684.2   |        
|2003 |       |                       | 227.8   |          |              |   | 1,529.6 |        
|2002 |       |                       | 171.1   |          |              |   | 508.3   |        
|2001 |       |                       | 7,237.7 |          |              |   | 541.2   |        
|2000 |       |                       | 4,942.2 |          |              |   | 536.0   |        
|     |       |                       |         |          |              |  
|     | Total |                       | $       | 13,530.8 |              |   | $       | 3,799.3 | 
|     |       |                       |         |          |              |  

Acquisitions






| |   |                                                                                      
| | - | -------------------------------------------------------------------------------------
| |  | the attractiveness of the property to existing and potential
    tenants;            
|
| |  | the likelihood and relative attractiveness of competitive supply;                    
|
| |  | the anticipated demand for space in the local market;                                
|
| |  | the creditworthiness and diversity of risk of the tenants
    occupying the property;

6



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##### Table of Contents





| |   |                                                                                                                                                                                                 
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the ability to acquire the asset at an attractive going-in
    yield, as well as the potential to increase operating income
    over time by increasing revenues;                               
|
| |  | the physical condition of the property, including the extent of
    funds required for maintenance and for physical upgrades needed
    in order to establish or sustain market competitiveness;
|
| |  | the cost structure of the property; and                                                                                                                                                         
|
| |  | the propertys location in one of our core markets.                                                                                                                                             



Dispositions






| |   |                                                                                                           
| | - | ----------------------------------------------------------------------------------------------------------
| |  | the ability to sell the property at an attractive price;                                                  
|
| |  | our ability to recycle capital into core markets and activities
    consistent with our business strategy;
|
| |  | our desire to exit markets that are not core markets;                                                     
|
| |  | whether the property is strategically located;                                                            
|
| |  | tenant composition and lease rollover for the property;                                                   
|
| |  | general economic conditions and outlook, including job growth in
    the local market; and                
|
| |  | the general quality of the asset.                                                                         

DEVELOPMENT ACTIVITY








| |   |                                                                                                         
| | - | --------------------------------------------------------------------------------------------------------
| |  | our assessment of the returns from such development;                                                    
|
| |  | the extent of lease-up risk in the context of the demand/supply
    characteristics of the local market;
|
| |  | the ability to minimize construction risks; and                                                         
|
| |  | the quality of local development partners, if applicable.                                               

FINANCING POLICIES




7



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DIVIDEND POLICY




SEGMENTS




COMPETITION




ENVIRONMENTAL EXPOSURE




8



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##### Table of Contents



FINANCIAL INFORMATION ABOUT GEOGRAPHIC AREAS




EMPLOYEES






9



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|                        |  |     |    |  |              |                                                                                        
|----------------------- |  | --- | -- |  | ------------ | ---------------------------------------------------------------------------------------
|Name                    |  | Age |    |  | Offices Held
|                        |  |     |    |  |             
|Richard D. Kincaid      |  |     | 43 |  |              | President and Chief Executive Officer                                                  
|Jeffrey L. Johnson      |  |     | 45 |  |              | Executive Vice President and Chief Investment Officer                                  
|Lawrence J. Krema       |  |     | 44 |  |              | Executive Vice President  Human Resources and
    Communications                      
|Peyton H. Owen, Jr.     |  |     | 47 |  |              | Executive Vice President and Chief Operating Officer                                   
|Stanley M. Stevens      |  |     | 56 |  |              | Executive Vice President, Chief Legal Counsel and Secretary                            
|Marsha C. Williams      |  |     | 53 |  |              | Executive Vice President and Chief Financial Officer                                   
|Robert J. Winter, Jr.   |  |     | 59 |  |              | Executive Vice President  Development and Joint
    Venture Management                
|Thomas Q. Bakke         |  |     | 50 |  |              | Senior Vice President  National Leasing and Marketing                                 
|James R. Bannon         |  |     | 48 |  |              | Senior Vice President  Operations                                                     
|David B. Baruch         |  |     | 41 |  |              | Senior Vice President  Chief Information Officer                                      
|Stephen M. Briggs       |  |     | 46 |  |              | Senior Vice President                                                                  
|M. Patrick Callahan     |  |     | 43 |  |              | Senior Vice President  Seattle Region                                                 
|Elizabeth P. Coronelli  |  |     | 38 |  |              | Senior Vice President  Investor Relations                                             
|Robert E. Dezzutti      |  |     | 44 |  |              | Senior Vice President  Los Angeles Region                                             
|Maureen Fear            |  |     | 48 |  |              | Senior Vice President and Treasurer                                                    
|Debra L. Ferruzzi       |  |     | 44 |  |              | Senior Vice President  Corporate Strategy                                             
|Frank Frankini          |  |     | 49 |  |              | Senior Vice President  Engineering, Construction and
    Energy Operations            
|Mark P. Geisreiter      |  |     | 43 |  |              | Senior Vice President  San Francisco Region                                           
|Matthew T. Gworek       |  |     | 44 |  |              | Senior Vice President  Investments                                                    
|Donald E. Huffner, Jr.  |  |     | 47 |  |              | Senior Vice President  Atlanta Region/New York and
    Washington, D.C. Region        
|Peter D. Johnston       |  |     | 47 |  |              | Senior Vice President  Houston Region                                                 
|Shobi S. Khan           |  |     | 39 |  |              | Senior Vice President  Investments                                                    
|Kim J. Koehn            |  |     | 49 |  |              | Senior Vice President  Denver Region and
    San Jose Region                          
|J. Michael Lynch        |  |     | 52 |  |              | Senior Vice President  Investments                                                    
|Diane M. Morefield      |  |     | 46 |  |              | Senior Vice President  Chicago Region                                                 
|John C. Schneider       |  |     | 46 |  |              | Senior Vice President  Legal and Associate General
    Counsel for Property Operations
|Mark E. Scully          |  |     | 46 |  |              | Senior Vice President  National Leasing                                               
|Virginia L. Seggerman   |  |     | 45 |  |              | Senior Vice President  Chief Accounting Officer                                       
|H. Gene Silverberg      |  |     | 51 |  |              | Senior Vice President  Retail Strategy                                                
|Paul R. Sorensen        |  |     | 45 |  |              | Senior Vice President  Portfolio Management                                           
|Maryann Gilligan Suydam |  |     | 55 |  |              | Senior Vice President  Boston Region                                                  
|R. David Turner         |  |     | 54 |  |              | Senior Vice President  Risk Management                                                

10



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Richard D. Kincaid




| |   |                                                                                                                                                                      
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Executive Vice President from March 1997 until November 2002;                                                                                                        
|
| |  | Chief Operating Officer from September 2001 until November 2002;                                                                                                     
|
| |  | Chief Financial Officer from March 1997 until August 2002;                                                                                                           
|
| |  | Senior Vice President from October 1996 until March 1997;                                                                                                            
|
| |  | Senior Vice President and Chief Financial Officer of Equity
    Office Holdings, L.L.C., a predecessor of ours, from July 1995
    until October 1997;               
|
| |  | Senior Vice President of Equity Group Investments, Inc., an
    owner and financier of real estate and corporate investments,
    from February 1995 until July 1995;
|
| |  | Senior Vice President of The Yarmouth Group, a real estate
    investment company in New York, New York, from August 1994 until
    February 1995;                   
|
| |  | Senior Vice President  Finance of Equity Group
    Investments, Inc. from December 1993 until July 1994; and                                                        
|
| |  | Vice President  Finance of Equity Group Investments,
    Inc. from August 1990 until December 1993.                                                                 

Jeffrey L. Johnson




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Managing Partner and owner of Lakeshore Holdings, LLC, a private
    equity firm focusing on real estate investment founded by
    Mr. Johnson in conjunction with Lehman Brothers Holdings
    Inc., a global financial services firm, from December 2002 until
    May 2003 (in this capacity, Mr. Johnson was responsible for
    all aspects of the business);                                                                                                    
|
| |  | Managing Director of Lehman Brothers Holdings Inc. from March
    2000 until November 2002 (in this capacity, Mr. Johnson was
    a founding partner and co-head of domestic investments for
    Lehman Brothers first real estate private equity group and
    was instrumental in helping raise the companys
    $1.6 billion fund and developing the investment strategy
    for the fund, built the investment team and implemented its
    investment process);
|
| |  | Chief Investment Officer of Equity Office from March 1998 until
    June 1999; and                                                                                                                                                                                                                                                                                                                                                                                    
|
| |  | Senior Vice President of Equity Office from March 1997 until
    June 1999.                                                                                                                                                                                                                                                                                                                                                                                           

Lawrence J. Krema




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                  
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Senior Vice President  Human Resources from March
    2001 until November 2002; and                                                                                                                                                                                                                                                                                                                             
|
| |  | Vice President of NEC Technologies, Inc., a supplier of
    presentation systems, computing and related technologies for the
    North American market, from April 1995 until October 2000 (in
    this capacity, Mr. Krema managed the human resources
    division of the company in North America and was responsible for
    corporate services, which included real estate, travel and
    office services).

Peyton H. Owen, Jr.




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Chief Operating Officer  Americas Region of Jones
    Lang LaSalle, a global provider of integrated real estate and
    investment management services, from April 1999 until October
    2003 (in this capacity, Mr. Owen oversaw 5,500 people in
    100 markets in the United States, Canada and Mexico; Investor
    Services, which included leasing and property management;
    Corporate Solutions, which included tenant representation,
    facility management and project management; and Capital Markets;
    and

11



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| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   | implemented standardized processes, new technologies and
    compliance measurements, and consolidated the organizational
    structure); and                                                                                                                                                                                                                                                                                                                             
|
| |  | Executive Vice President and Chief Operating Officer 
    Leasing and Management of LaSalle Partners, predecessor of Jones
    Lang LaSalle, from January 1996 until April 1999 (in this
    capacity, Mr. Owen oversaw the leasing and management
    activities for a 200-million-square-foot investment property
    portfolio, restructured leasing and management across 20 markets
    and led due diligence and integration in various corporate
    acquisitions.

Stanley M. Stevens


Marsha C. Williams




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Chief Administrative Officer of Crate and Barrel, a national
    Chicago-based retailer of home furnishings and accessories
    (Crate and Barrel is the trade name of Euromarket Designs Inc.,
    which is an indirect majority-owned subsidiary of Otto Versand
    Gmbh & Co., a German mail-order company), from May 1998
    until August 2002 (in this capacity, Ms. Williams
    participated in the planning and execution of Crate and
    Barrels growth strategy and managed its finance,
    accounting, information technology, warehousing, distribution
    and logistics, loss prevention, strategic planning, direct
    marketing operations and purchasing departments); and
|
| |  | Vice President of Amoco Corporation, a worldwide energy and
    chemical company, from December 1997 until April 1998 and
    Treasurer of Amoco Corporation from October 1993 until April
    1998, as well as other capacities and positions from November
    1989 until October 1993.                                                                                                                                                                                                                                                                                                                                                                                                        

Robert J. Winter, Jr.




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                      
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Executive Vice President  Development and Portfolio
    Management from November 2002 until February 2005;                                                                                                                                                                                                                                                                                                          
|
| |  | Senior Vice President  Development from June 2002
    until November 2002;                                                                                                                                                                                                                                                                                                                                          
|
| |  | Senior Vice President  Development Investments from
    July 2001 until June 2002;                                                                                                                                                                                                                                                                                                                                  
|
| |  | President and Chief Executive Officer of Amli Commercial
    Properties Trust, a private real estate investment trust with
    office and industrial properties in the suburban Chicago market,
    from August 1998 until July 2001 (in this capacity,
    Mr. Winter was responsible for all aspects of the
    companys business, including the development, management
    and ownership of its properties); and
|
| |  | President and Chief Executive Officer of Amli Commercial
    Properties, LLC, a limited liability company and predecessor of
    Amli Commercial Properties Trust, from November 1996 until July
    1998 (in this capacity, along with developing the business,
    Mr. Winter was responsible for forming Amli Commercial
    Properties Trust).                                                                   






|        |            
|------- | -----------
|Item 2. | Properties.



12



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Office Property Statistics




|                 |                         |           |     |                        |             |               |                            |             |  |  |          |       |                  |             |      |               |             |  |            |             |  |  |      |       |   |  |      |       |  
|---------------- | ----------------------- | --------- | --- | ---------------------- | ----------- | ------------- | -------------------------- | ----------- |  |  | -------- | ----- | ---------------- | ----------- | ---- | ------------- | ----------- |  | ---------- | ----------- |  |  | ---- | ----- | - |  | ---- | ----- | -
|                 |                         |           |     | Total Office Portfolio |             |               | Effective Office Portfolio |            
|                 |                         |           |     |                        |             |               |                            |            
|                 |                         |           |     |                        |             |               |                            | Percent of  | 
|                 |                         |           |     |                        |             | Percentage of |                            |             |  |  |          |       | Percentage of    |             |      | Our Property  |            
|                 |                         |           |     |                        |             | Total Office  |                            |             |  |  |          |       | Effective Office |             |      | Net Operating |            
|                 |                         |           |     |                        |             | Portfolio     |                            |             |  |  |          |       | Portfolio        |             |      | Income from   |            
|                 |                         | Number of |     |                        | Rentable    |               |                            | Rentable    |  |  | Percent  |       |                  | Rentable    |      |               | Rentable    |  |            | Continuing  | 
|Primary Market   |                         | Buildings |     |                        | Square Feet |               |                            | Square Feet |  |  | Occupied |       |                  | Square Feet |      |               | Square Feet |  |            | Operations  | 
|                 |                         |           |     |                        |             |               |                            |             |  |  |          |       |                  |             |      |               |             |  |            |             | 
|Boston           |                         |           | 51  |                        |             |               | 12,567,429                 |             |  |  | 10.0     | %     |                  |             | 90.9 | %             |             |  | 11,494,038 |             |  |  | 10.0 | %     |   |  | 12.4 | %    
|San Francisco    |                         |           | 83  |                        |             |               | 11,056,730                 |             |  |  | 8.8      | %     |                  |             | 79.0 | %             |             |  | 10,802,285 |             |  |  | 9.4  | %     |   |  | 10.1 | %    
|San Jose         |                         |           | 117 |                        |             |               | 8,256,995                  |             |  |  | 6.6      | %     |                  |             | 85.2 | %             |             |  | 8,256,995  |             |  |  | 7.2  | %     |   |  | 9.7  | %    
|New York         |                         |           | 7   |                        |             |               | 5,347,465                  |             |  |  | 4.3      | %     |                  |             | 95.3 | %             |             |  | 5,341,776  |             |  |  | 4.6  | %     |   |  | 8.8  | %    
|Los Angeles      |                         |           | 50  |                        |             |               | 8,656,910                  |             |  |  | 6.9      | %     |                  |             | 86.6 | %             |             |  | 7,494,582  |             |  |  | 6.5  | %     |   |  | 7.7  | %    
|Seattle          |                         |           | 54  |                        |             |               | 10,001,902                 |             |  |  | 8.0      | %     |                  |             | 87.0 | %             |             |  | 8,788,803  |             |  |  | 7.6  | %     |   |  | 7.3  | %    
|Chicago          |                         |           | 33  |                        |             |               | 11,700,945                 |             |  |  | 9.3      | %     |                  |             | 89.2 | %             |             |  | 10,442,233 |             |  |  | 9.1  | %     |   |  | 7.2  | %    
|Washington, D.C. |                         |           | 27  |                        |             |               | 6,369,951                  |             |  |  | 5.1      | %     |                  |             | 91.8 | %             |             |  | 5,847,654  |             |  |  | 5.1  | %     |   |  | 6.8  | %    
|Atlanta          |                         |           | 43  |                        |             |               | 7,570,080                  |             |  |  | 6.0      | %     |                  |             | 83.5 | %             |             |  | 6,864,676  |             |  |  | 6.0  | %     |   |  | 4.5  | %    
|Orange County    |                         |           | 33  |                        |             |               | 6,039,396                  |             |  |  | 4.8      | %     |                  |             | 95.4 | %             |             |  | 6,039,396  |             |  |  | 5.2  | %     |   |  | 4.4  | %    
|All others       |                         |           | 200 |                        |             |               | 38,145,442                 |             |  |  | 30.3     | %     |                  |             | 87.6 | %             |             |  | 33,907,305 |             |  |  | 29.4 | %     |   |  | 21.0 | %    
|                 |                         |           |     |                        |             |               |                            |             |  |  |          |       |                  |             |      |               |             |  |            |             | 
|                 | Total/ Weighted Average |           |     | 698                    |             |               |                            | 125,713,245 |  |  |          | 100.0 | %                |             |      | 87.7          | %           |  |            | 115,279,743 |  |  |      | 100.0 | % |  |      | 100.0 | %
|                 |                         |           |     |                        |             |               |                            |             |  |  |          |       |                  |             |      |               |             |  |            |             | 

Total Office Portfolio Lease Expiration Schedule




13



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##### Table of Contents



Total Office Portfolio Lease Expiration Schedule (a)


December 31, 2004


|                                            |  |                                                       |           |   |      |   |           |      |  |   |           |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |           |   |  |   |         |   |  |   |           |   |  |   |            |  
|------------------------------------------- |  | ----------------------------------------------------- | --------- | - | ---- | - | --------- | ---- |  | - | --------- | - |  | ---- | --------- | - | ---- | - | --------- | ---- |  | - | --------- | - |  | ---- | ------- | - | ---- | - | ------- | ------------- |  | - | --------- | - |  | - | ------- | - |  | - | --------- | - |  | - | ---------- | -
|                                            |  | 2005 and                                              |           |   |      |   |           |      |  |   |           |   |  |      |           |   |      |   |           |      |  |   |           |   | 
|                                            |  | month to                                              |           |   |      |   |           |      |  |   |           |   |  |      |           |   |      |   |           |      |  |   |           |   | 
|                                            |  | month(b)                                              |           |   | 2006 |   |           | 2007 |  |   | 2008      |   |  | 2009 |           |   | 2010 |   |           | 2011 |  |   | 2012      |   |  | 2013 |         |   | 2014 |   |         | Thereafter(f) |  |   | Totals    |  
|                                            |  |                                                       |           |   |      |   |           |      |  |   |           |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |           |  
|                                            |  | (Dollars in thousands except per square foot amounts) |          
|Boston                                      |  |                                                       |           |   |      |   |           |      |  |   |           |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |           |   |  |   |         |   |  |   |           |   |  |   |            |  
|Square Feet(c)                              |  |                                                       | 972,316   |   |      |   | 847,273   |      |  |   | 1,565,349 |   |  |      | 1,392,031 |   |      |   | 1,262,775 |      |  |   | 1,396,907 |   |  |      | 338,674 |   |      |   | 859,366 |               |  |   | 1,359,279 |   |  |   | 635,054 |   |  |   | 798,548   |   |  |   | 11,427,572 |  
|% Square Feet(d)                            |  |                                                       | 7.7       | % |      |   | 6.7       | %    |  |   | 12.5      | % |  |      | 11.1      | % |      |   | 10.0      | %    |  |   | 11.1      | % |  |      | 2.7     | % |      |   | 6.8     | %             |  |   | 10.8      | % |  |   | 5.1     | % |  |   | 6.4       | % |  |   | 90.9       | %
|Annualized Rent for occupied square feet(e) |  | $                                                     | 32,781    |   |      | $ | 26,839    |      |  | $ | 60,699    |   |  | $    | 52,843    |   |      | $ | 47,547    |      |  | $ | 53,072    |   |  | $    | 14,546  |   |      | $ | 38,970  |               |  | $ | 55,694    |   |  | $ | 21,311  |   |  | $ | 33,504    |   |  | $ | 437,806    |  
|Annualized Rent per occupied square foot(e) |  | $                                                     | 33.71     |   |      | $ | 31.68     |      |  | $ | 38.78     |   |  | $    | 37.96     |   |      | $ | 37.65     |      |  | $ | 37.99     |   |  | $    | 42.95   |   |      | $ | 45.35   |               |  | $ | 40.97     |   |  | $ | 33.56   |   |  | $ | 41.96     |   |  | $ | 38.31      |  
|San Francisco                               |  |                                                       |           |   |      |   |           |      |  |   |           |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |           |   |  |   |         |   |  |   |           |   |  |   |            |  
|Square Feet(c)                              |  |                                                       | 1,434,728 |   |      |   | 808,772   |      |  |   | 1,213,498 |   |  |      | 1,378,500 |   |      |   | 923,469   |      |  |   | 977,708   |   |  |      | 470,309 |   |      |   | 227,802 |               |  |   | 350,462   |   |  |   | 286,219 |   |  |   | 659,383   |   |  |   | 8,730,850  |  
|% Square Feet(d)                            |  |                                                       | 13.0      | % |      |   | 7.3       | %    |  |   | 11.0      | % |  |      | 12.5      | % |      |   | 8.4       | %    |  |   | 8.8       | % |  |      | 4.3     | % |      |   | 2.1     | %             |  |   | 3.2       | % |  |   | 2.6     | % |  |   | 6.0       | % |  |   | 79.0       | %
|Annualized Rent for occupied square feet(e) |  | $                                                     | 58,607    |   |      | $ | 38,869    |      |  | $ | 43,270    |   |  | $    | 51,206    |   |      | $ | 27,651    |      |  | $ | 45,383    |   |  | $    | 21,073  |   |      | $ | 7,666   |               |  | $ | 10,725    |   |  | $ | 7,022   |   |  | $ | 37,426    |   |  | $ | 348,900    |  
|Annualized Rent per occupied square foot(e) |  | $                                                     | 40.85     |   |      | $ | 48.06     |      |  | $ | 35.66     |   |  | $    | 37.15     |   |      | $ | 29.94     |      |  | $ | 46.42     |   |  | $    | 44.81   |   |      | $ | 33.65   |               |  | $ | 30.60     |   |  | $ | 24.54   |   |  | $ | 56.76     |   |  | $ | 39.96      |  
|San Jose                                    |  |                                                       |           |   |      |   |           |      |  |   |           |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |           |   |  |   |         |   |  |   |           |   |  |   |            |  
|Square Feet(c)                              |  |                                                       | 1,053,618 |   |      |   | 1,053,915 |      |  |   | 854,921   |   |  |      | 466,308   |   |      |   | 559,076   |      |  |   | 907,758   |   |  |      | 825,613 |   |      |   | 458,779 |               |  |   | 116,214   |   |  |   | 487,679 |   |  |   | 254,295   |   |  |   | 7,038,176  |  
|% Square Feet(d)                            |  |                                                       | 12.8      | % |      |   | 12.8      | %    |  |   | 10.4      | % |  |      | 5.6       | % |      |   | 6.8       | %    |  |   | 11.0      | % |  |      | 10.0    | % |      |   | 5.6     | %             |  |   | 1.4       | % |  |   | 5.9     | % |  |   | 3.1       | % |  |   | 85.2       | %
|Annualized Rent for occupied square feet(e) |  | $                                                     | 34,930    |   |      | $ | 35,005    |      |  | $ | 28,164    |   |  | $    | 12,671    |   |      | $ | 16,180    |      |  | $ | 35,425    |   |  | $    | 52,496  |   |      | $ | 31,014  |               |  | $ | 3,694     |   |  | $ | 9,043   |   |  | $ | 6,521     |   |  | $ | 265,144    |  
|Annualized Rent per occupied square foot(e) |  | $                                                     | 33.15     |   |      | $ | 33.21     |      |  | $ | 32.94     |   |  | $    | 27.17     |   |      | $ | 28.94     |      |  | $ | 39.03     |   |  | $    | 63.58   |   |      | $ | 67.60   |               |  | $ | 31.79     |   |  | $ | 18.54   |   |  | $ | 25.64     |   |  | $ | 37.67      |  
|New York                                    |  |                                                       |           |   |      |   |           |      |  |   |           |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |           |   |  |   |         |   |  |   |           |   |  |   |            |  
|Square Feet(c)                              |  |                                                       | 449,114   |   |      |   | 203,138   |      |  |   | 173,852   |   |  |      | 126,860   |   |      |   | 1,253,489 |      |  |   | 291,004   |   |  |      | 420,762 |   |      |   | 462,762 |               |  |   | 436,482   |   |  |   | 107,194 |   |  |   | 1,170,152 |   |  |   | 5,094,809  |  
|% Square Feet(d)                            |  |                                                       | 8.4       | % |      |   | 3.8       | %    |  |   | 3.3       | % |  |      | 2.4       | % |      |   | 23.4      | %    |  |   | 5.4       | % |  |      | 7.9     | % |      |   | 8.7     | %             |  |   | 8.2       | % |  |   | 2.0     | % |  |   | 21.9      | % |  |   | 95.3       | %
|Annualized Rent for occupied square feet(e) |  | $                                                     | 18,342    |   |      | $ | 12,673    |      |  | $ | 8,661     |   |  | $    | 7,432     |   |      | $ | 71,472    |      |  | $ | 13,663    |   |  | $    | 25,240  |   |      | $ | 20,567  |               |  | $ | 23,743    |   |  | $ | 6,416   |   |  | $ | 60,856    |   |  | $ | 269,065    |  
|Annualized Rent per occupied square foot(e) |  | $                                                     | 40.84     |   |      | $ | 62.39     |      |  | $ | 49.82     |   |  | $    | 58.58     |   |      | $ | 57.02     |      |  | $ | 46.95     |   |  | $    | 59.99   |   |      | $ | 44.44   |               |  | $ | 54.40     |   |  | $ | 59.86   |   |  | $ | 52.01     |   |  | $ | 52.81      |  
|Los Angeles                                 |  |                                                       |           |   |      |   |           |      |  |   |           |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |           |   |  |   |         |   |  |   |           |   |  |   |            |  
|Square Feet(c)                              |  |                                                       | 750,221   |   |      |   | 909,472   |      |  |   | 1,140,446 |   |  |      | 602,382   |   |      |   | 687,826   |      |  |   | 628,548   |   |  |      | 482,143 |   |      |   | 652,899 |               |  |   | 632,986   |   |  |   | 335,525 |   |  |   | 675,370   |   |  |   | 7,497,818  |  
|% Square Feet(d)                            |  |                                                       | 8.7       | % |      |   | 10.5      | %    |  |   | 13.2      | % |  |      | 7.0       | % |      |   | 7.9       | %    |  |   | 7.3       | % |  |      | 5.6     | % |      |   | 7.5     | %             |  |   | 7.3       | % |  |   | 3.9     | % |  |   | 7.8       | % |  |   | 86.6       | %
|Annualized Rent for occupied square feet(e) |  | $                                                     | 24,116    |   |      | $ | 32,913    |      |  | $ | 39,157    |   |  | $    | 18,706    |   |      | $ | 18,677    |      |  | $ | 18,832    |   |  | $    | 17,545  |   |      | $ | 22,036  |               |  | $ | 21,379    |   |  | $ | 11,804  |   |  | $ | 19,825    |   |  | $ | 244,990    |  
|Annualized Rent per occupied square foot(e) |  | $                                                     | 32.14     |   |      | $ | 36.19     |      |  | $ | 34.33     |   |  | $    | 31.05     |   |      | $ | 27.15     |      |  | $ | 29.96     |   |  | $    | 36.39   |   |      | $ | 33.75   |               |  | $ | 33.78     |   |  | $ | 35.18   |   |  | $ | 29.35     |   |  | $ | 32.67      |  

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|                                                     |  |                                                       |           |   |      |   |           |      |  |   |         |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |         |   |  |   |         |   |  |   |           |   |  |   |            |  
|---------------------------------------------------- |  | ----------------------------------------------------- | --------- | - | ---- | - | --------- | ---- |  | - | ------- | - |  | ---- | --------- | - | ---- | - | --------- | ---- |  | - | --------- | - |  | ---- | ------- | - | ---- | - | ------- | ------------- |  | - | ------- | - |  | - | ------- | - |  | - | --------- | - |  | - | ---------- | -
|Total Office Portfolio Lease Expiration Schedule (a) | 
|December 31, 2004  (Continued)                      | 
|                                                     |  | 2005 and                                              |           |   |     
|                                                     |  | month to                                              |           |   |     
|                                                     |  | month(b)                                              |           |   | 2006 |   |           | 2007 |  |   | 2008    |   |  | 2009 |           |   | 2010 |   |           | 2011 |  |   | 2012      |   |  | 2013 |         |   | 2014 |   |         | Thereafter(f) |  |   | Totals  |  
|                                                     |  |                                                       |           |   |      |   |           |      |  |   |         |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |         |  
|                                                     |  | (Dollars in thousands except per square foot amounts) |          
|Seattle                                              |  |                                                       |           |   |      |   |           |      |  |   |         |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |         |   |  |   |         |   |  |   |           |   |  |   |            |  
|Square Feet(c)                                       |  |                                                       | 899,904   |   |      |   | 817,962   |      |  |   | 893,482 |   |  |      | 1,240,650 |   |      |   | 1,360,692 |      |  |   | 1,119,306 |   |  |      | 433,978 |   |      |   | 430,637 |               |  |   | 401,903 |   |  |   | 403,020 |   |  |   | 701,480   |   |  |   | 8,703,014  |  
|% Square Feet(d)                                     |  |                                                       | 9.0       | % |      |   | 8.2       | %    |  |   | 8.9     | % |  |      | 12.4      | % |      |   | 13.6      | %    |  |   | 11.2      | % |  |      | 4.3     | % |      |   | 4.3     | %             |  |   | 4.0     | % |  |   | 4.0     | % |  |   | 7.0       | % |  |   | 87.0       | %
|Annualized Rent for occupied square feet(e)          |  | $                                                     | 25,209    |   |      | $ | 23,670    |      |  | $ | 25,116  |   |  | $    | 32,262    |   |      | $ | 32,318    |      |  | $ | 30,517    |   |  | $    | 11,069  |   |      | $ | 12,170  |               |  | $ | 10,250  |   |  | $ | 8,901   |   |  | $ | 17,097    |   |  | $ | 228,581    |  
|Annualized Rent per occupied square foot(e)          |  | $                                                     | 28.01     |   |      | $ | 28.94     |      |  | $ | 28.11   |   |  | $    | 26.00     |   |      | $ | 23.75     |      |  | $ | 27.26     |   |  | $    | 25.51   |   |      | $ | 28.26   |               |  | $ | 25.50   |   |  | $ | 22.09   |   |  | $ | 24.37     |   |  | $ | 26.26      |  
|Chicago                                              |  |                                                       |           |   |      |   |           |      |  |   |         |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |         |   |  |   |         |   |  |   |           |   |  |   |            |  
|Square Feet(c)                                       |  |                                                       | 1,454,760 |   |      |   | 1,284,114 |      |  |   | 918,192 |   |  |      | 1,425,120 |   |      |   | 955,741   |      |  |   | 1,101,009 |   |  |      | 547,496 |   |      |   | 621,802 |               |  |   | 502,717 |   |  |   | 472,933 |   |  |   | 1,150,987 |   |  |   | 10,434,871 |  
|% Square Feet(d)                                     |  |                                                       | 12.4      | % |      |   | 11.0      | %    |  |   | 7.8     | % |  |      | 12.2      | % |      |   | 8.2       | %    |  |   | 9.4       | % |  |      | 4.7     | % |      |   | 5.3     | %             |  |   | 4.3     | % |  |   | 4.0     | % |  |   | 9.8       | % |  |   | 89.2       | %
|Annualized Rent for occupied square feet(e)          |  | $                                                     | 39,996    |   |      | $ | 36,847    |      |  | $ | 24,449  |   |  | $    | 41,027    |   |      | $ | 28,205    |      |  | $ | 28,906    |   |  | $    | 13,735  |   |      | $ | 17,930  |               |  | $ | 13,404  |   |  | $ | 11,307  |   |  | $ | 25,079    |   |  | $ | 280,885    |  
|Annualized Rent per occupied square foot(e)          |  | $                                                     | 27.49     |   |      | $ | 28.69     |      |  | $ | 26.63   |   |  | $    | 28.79     |   |      | $ | 29.51     |      |  | $ | 26.25     |   |  | $    | 25.09   |   |      | $ | 28.84   |               |  | $ | 26.66   |   |  | $ | 23.91   |   |  | $ | 21.79     |   |  | $ | 26.92      |  
|Washington, D.C.                                     |  |                                                       |           |   |      |   |           |      |  |   |         |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |         |   |  |   |         |   |  |   |           |   |  |   |            |  
|Square Feet(c)                                       |  |                                                       | 557,534   |   |      |   | 490,379   |      |  |   | 584,586 |   |  |      | 893,531   |   |      |   | 719,686   |      |  |   | 315,683   |   |  |      | 675,778 |   |      |   | 335,166 |               |  |   | 250,325 |   |  |   | 631,830 |   |  |   | 393,980   |   |  |   | 5,848,478  |  
|% Square Feet(d)                                     |  |                                                       | 8.8       | % |      |   | 7.7       | %    |  |   | 9.2     | % |  |      | 14.0      | % |      |   | 11.3      | %    |  |   | 5.0       | % |  |      | 10.6    | % |      |   | 5.3     | %             |  |   | 3.9     | % |  |   | 9.9     | % |  |   | 6.2       | % |  |   | 91.8       | %
|Annualized Rent for occupied square feet(e)          |  | $                                                     | 18,956    |   |      | $ | 15,845    |      |  | $ | 16,356  |   |  | $    | 30,435    |   |      | $ | 21,943    |      |  | $ | 14,385    |   |  | $    | 21,762  |   |      | $ | 10,364  |               |  | $ | 8,843   |   |  | $ | 21,008  |   |  | $ | 16,354    |   |  | $ | 196,252    |  
|Annualized Rent per occupied square foot(e)          |  | $                                                     | 34.00     |   |      | $ | 32.31     |      |  | $ | 27.98   |   |  | $    | 34.06     |   |      | $ | 30.49     |      |  | $ | 45.57     |   |  | $    | 32.20   |   |      | $ | 30.92   |               |  | $ | 35.33   |   |  | $ | 33.25   |   |  | $ | 41.51     |   |  | $ | 33.56      |  
|Atlanta                                              |  |                                                       |           |   |      |   |           |      |  |   |         |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |         |   |  |   |         |   |  |   |           |   |  |   |            |  
|Square Feet(c)                                       |  |                                                       | 626,892   |   |      |   | 1,247,446 |      |  |   | 769,322 |   |  |      | 613,239   |   |      |   | 714,604   |      |  |   | 1,255,527 |   |  |      | 287,782 |   |      |   | 148,119 |               |  |   | 128,563 |   |  |   | 268,009 |   |  |   | 263,777   |   |  |   | 6,323,280  |  
|% Square Feet(d)                                     |  |                                                       | 8.3       | % |      |   | 16.5      | %    |  |   | 10.2    | % |  |      | 8.1       | % |      |   | 9.4       | %    |  |   | 16.6      | % |  |      | 3.8     | % |      |   | 2.0     | %             |  |   | 1.7     | % |  |   | 3.5     | % |  |   | 3.5       | % |  |   | 83.5       | %
|Annualized Rent for occupied square feet(e)          |  | $                                                     | 14,097    |   |      | $ | 35,775    |      |  | $ | 16,749  |   |  | $    | 11,653    |   |      | $ | 20,944    |      |  | $ | 30,919    |   |  | $    | 6,609   |   |      | $ | 3,034   |               |  | $ | 2,953   |   |  | $ | 4,899   |   |  | $ | 5,115     |   |  | $ | 152,747    |  
|Annualized Rent per occupied square foot(e)          |  | $                                                     | 22.49     |   |      | $ | 28.68     |      |  | $ | 21.77   |   |  | $    | 19.00     |   |      | $ | 29.31     |      |  | $ | 24.63     |   |  | $    | 22.96   |   |      | $ | 20.48   |               |  | $ | 22.97   |   |  | $ | 18.28   |   |  | $ | 19.39     |   |  | $ | 24.16      |  
|Orange County                                        |  |                                                       |           |   |      |   |           |      |  |   |         |   |  |      |           |   |      |   |           |      |  |   |           |   |  |      |         |   |      |   |         |               |  |   |         |   |  |   |         |   |  |   |           |   |  |   |            |  
|Square Feet(c)                                       |  |                                                       | 951,191   |   |      |   | 906,777   |      |  |   | 944,865 |   |  |      | 1,434,776 |   |      |   | 521,498   |      |  |   | 385,778   |   |  |      | 223,788 |   |      |   | 176,459 |               |  |   | 159,572 |   |  |   | 13,336  |   |  |   | 42,088    |   |  |   | 5,760,128  |  
|% Square Feet(d)                                     |  |                                                       | 15.7      | % |      |   | 15.0      | %    |  |   | 15.6    | % |  |      | 23.8      | % |      |   | 8.6       | %    |  |   | 6.4       | % |  |      | 3.7     | % |      |   | 2.9     | %             |  |   | 2.6     | % |  |   | 0.2     | % |  |   | 0.7       | % |  |   | 95.4       | %
|Annualized Rent for occupied square feet(e)          |  | $                                                     | 25,885    |   |      | $ | 23,888    |      |  | $ | 23,704  |   |  | $    | 32,494    |   |      | $ | 12,822    |      |  | $ | 8,953     |   |  | $    | 5,114   |   |      | $ | 4,497   |               |  | $ | 3,687   |   |  | $ | 290     |   |  | $ | 311       |   |  | $ | 141,646    |  
|Annualized Rent per occupied square foot(e)          |  | $                                                     | 27.21     |   |      | $ | 26.34     |      |  | $ | 25.09   |   |  | $    | 22.65     |   |      | $ | 24.59     |      |  | $ | 23.21     |   |  | $    | 22.85   |   |      | $ | 25.49   |               |  | $ | 23.11   |   |  | $ | 21.77   |   |  | $ | 7.39      |   |  | $ | 24.59      |  

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|                                                     |  |                                                       |            |   |      |   |            |      |  |   |            |   |  |      |            |   |      |   |            |      |  |   |            |   |  |      |           |   |      |   |           |               |  |   |           |   |  |   |           |   |  |   |           |   |  |   |             |  
|---------------------------------------------------- |  | ----------------------------------------------------- | ---------- | - | ---- | - | ---------- | ---- |  | - | ---------- | - |  | ---- | ---------- | - | ---- | - | ---------- | ---- |  | - | ---------- | - |  | ---- | --------- | - | ---- | - | --------- | ------------- |  | - | --------- | - |  | - | --------- | - |  | - | --------- | - |  | - | ----------- | -
|Total Office Portfolio Lease Expiration Schedule (a) | 
|December 31, 2004  (Continued)                      | 
|                                                     |  | 2005 and                                              |            |   |     
|                                                     |  | month to                                              |            |   |     
|                                                     |  | month(b)                                              |            |   | 2006 |   |            | 2007 |  |   | 2008       |   |  | 2009 |            |   | 2010 |   |            | 2011 |  |   | 2012       |   |  | 2013 |           |   | 2014 |   |           | Thereafter(f) |  |   | Totals    |  
|                                                     |  |                                                       |            |   |      |   |            |      |  |   |            |   |  |      |            |   |      |   |            |      |  |   |            |   |  |      |           |   |      |   |           |               |  |   |           |  
|                                                     |  | (Dollars in thousands except per square foot amounts) |           
|All Others                                           |  |                                                       |            |   |      |   |            |      |  |   |            |   |  |      |            |   |      |   |            |      |  |   |            |   |  |      |           |   |      |   |           |               |  |   |           |   |  |   |           |   |  |   |           |   |  |   |             |  
|Square Feet(c)                                       |  |                                                       | 4,301,405  |   |      |   | 5,034,649  |      |  |   | 4,761,887  |   |  |      | 4,683,608  |   |      |   | 5,385,792  |      |  |   | 2,234,513  |   |  |      | 1,725,121 |   |      |   | 1,324,196 |               |  |   | 877,495   |   |  |   | 1,122,249 |   |  |   | 1,967,515 |   |  |   | 33,418,430  |  
|% Square Feet(d)                                     |  |                                                       | 11.3       | % |      |   | 13.2       | %    |  |   | 12.5       | % |  |      | 12.3       | % |      |   | 14.1       | %    |  |   | 5.9        | % |  |      | 4.5       | % |      |   | 3.5       | %             |  |   | 2.3       | % |  |   | 2.9       | % |  |   | 5.2       | % |  |   | 87.6        | %
|Annualized Rent for occupied square feet(e)          |  | $                                                     | 104,205    |   |      | $ | 123,470    |      |  | $ | 111,792    |   |  | $    | 105,700    |   |      | $ | 115,067    |      |  | $ | 52,220     |   |  | $    | 42,815    |   |      | $ | 29,489    |               |  | $ | 22,482    |   |  | $ | 24,293    |   |  | $ | 43,060    |   |  | $ | 774,595     |  
|Annualized Rent per occupied square foot(e)          |  | $                                                     | 24.23      |   |      | $ | 24.52      |      |  | $ | 23.48      |   |  | $    | 22.57      |   |      | $ | 21.36      |      |  | $ | 23.37      |   |  | $    | 24.82     |   |      | $ | 22.27     |               |  | $ | 25.62     |   |  | $ | 21.65     |   |  | $ | 21.89     |   |  | $ | 23.18       |  
|Total Portfolio                                      |  |                                                       |            |   |      |   |            |      |  |   |            |   |  |      |            |   |      |   |            |      |  |   |            |   |  |      |           |   |      |   |           |               |  |   |           |   |  |   |           |   |  |   |           |   |  |   |             |  
|Square Feet(c)                                       |  |                                                       | 13,451,683 |   |      |   | 13,603,897 |      |  |   | 13,820,400 |   |  |      | 14,257,005 |   |      |   | 14,344,648 |      |  |   | 10,613,741 |   |  |      | 6,431,444 |   |      |   | 5,697,987 |               |  |   | 5,215,998 |   |  |   | 4,763,048 |   |  |   | 8,077,575 |   |  |   | 110,277,426 |  
|% Square Feet(d)                                     |  |                                                       | 10.7       | % |      |   | 10.8       | %    |  |   | 11.0       | % |  |      | 11.3       | % |      |   | 11.4       | %    |  |   | 8.4        | % |  |      | 5.1       | % |      |   | 4.5       | %             |  |   | 4.1       | % |  |   | 3.8       | % |  |   | 6.4       | % |  |   | 87.7        | %
|Annualized Rent for occupied square feet(e)          |  | $                                                     | 397,123    |   |      | $ | 405,795    |      |  | $ | 398,118    |   |  | $    | 396,430    |   |      | $ | 412,828    |      |  | $ | 332,274    |   |  | $    | 232,006   |   |      | $ | 197,737   |               |  | $ | 176,854   |   |  | $ | 126,296   |   |  | $ | 265,149   |   |  | $ | 3,340,611   |  
|Annualized Rent per occupied square foot(e)          |  | $                                                     | 29.52      |   |      | $ | 29.83      |      |  | $ | 28.81      |   |  | $    | 27.81      |   |      | $ | 28.78      |      |  | $ | 31.31      |   |  | $    | 36.07     |   |      | $ | 34.70     |               |  | $ | 33.91     |   |  | $ | 26.52     |   |  | $ | 32.83     |   |  | $ | 30.29       |  






|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Based on the contractual termination date of the lease without
    regard to any early lease termination and/or renewal options.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   
|(b) |  | Total square feet subject to month to month leases is
    approximately 848,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   
|(c) |  | Total net rentable square feet represented by expiring leases.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   
|(d) |  | Percentage of total net rentable square feet represented by
    expiring leases.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   
|(e) |  | Based on annualized rent. Annualized rent is the monthly
    contractual rent as of the reporting date, or if the current
    rent payable is $0 then the first monthly rent payment due,
    under existing leases as of December 31, 2004 multiplied by
    12 months (Annualized Rent). This amount
    reflects total base rent and estimated expense reimbursements
    from tenants as of December 31, 2004 without regard to any
    rent concessions and contractual increases or decreases in rent
    subsequent to December 31, 2004. Total rent concessions for
    leases in place as of December 31, 2004, for the period
    from January 1, 2005 to December 31, 2005 are
    approximately $40.0 million. We believe Annualized Rent is
    a useful measure because this information can be used for
    comparison to current market rents as published by various third
    party sources.
|   
|(f) |  | Management offices and building use square footage are included
    with $0 rent per square foot.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

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##### Table of Contents








|        |                  
|------- | -----------------
|Item 3. | Legal Proceeding.








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



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##### Table of Contents






PART II







|        |                                                                                                                      
|------- | ---------------------------------------------------------------------------------------------------------------------
|Item 5. | Market for Registrants Common Equity, Related
    Stockholder Matters and Issuer Purchases of Equity
    Securities.



|     |  |         |        |  |      |   |       |     |  |   |       |  |  |               |       |  |  |   |      | 
|---- |  | ------- | ------ |  | ---- | - | ----- | --- |  | - | ----- |  |  | ------------- | ----- |  |  | - | ---- | 
|Year |  | Quarter |        |  | High |   |       | Low |  |   | Close |  |  | Distributions |      
|     |  |         |        |  |      |   |       |     |  |   |       |  |  |               |      
|2004 |  |         | Fourth |  |      | $ | 29.86 |     |  | $ | 27.11 |  |  | $             | 29.12 |  |  | $ | 0.50 | 
|     |  |         | Third  |  |      | $ | 28.95 |     |  | $ | 25.71 |  |  | $             | 27.25 |  |  | $ | 0.50 | 
|     |  |         | Second |  |      | $ | 29.20 |     |  | $ | 23.90 |  |  | $             | 27.20 |  |  | $ | 0.50 | 
|     |  |         | First  |  |      | $ | 30.39 |     |  | $ | 27.81 |  |  | $             | 28.89 |  |  | $ | 0.50 | 
|2003 |  |         | Fourth |  |      | $ | 29.30 |     |  | $ | 26.99 |  |  | $             | 28.65 |  |  | $ | 0.50 | 
|     |  |         | Third  |  |      | $ | 28.20 |     |  | $ | 26.46 |  |  | $             | 27.53 |  |  | $ | 0.50 | 
|     |  |         | Second |  |      | $ | 27.92 |     |  | $ | 25.52 |  |  | $             | 27.01 |  |  | $ | 0.50 | 
|     |  |         | First  |  |      | $ | 26.24 |     |  | $ | 23.31 |  |  | $             | 25.45 |  |  | $ | 0.50 | 



| |                                                                                        
| | ---------------------------------------------------------------------------------------
| | Recent Sales of Unregistered Securities; Use of Proceeds
    from Registered Securities



|                |                     |                     |        |        |                   |                     |       |                 |                  |  |                 |        |  |   |             |  | 
|--------------- | ------------------- | ------------------- | ------ | ------ | ----------------- | ------------------- | ----- | --------------- | ---------------- |  | --------------- | ------ |  | - | ----------- |  | 
|                |                     |                     |        |        |                   | Total Number of     |       |                 | Dollar Value of  | 
|                |                     |                     |        |        |                   | Shares Purchased    |       |                 | Shares that May  | 
|                |                     |                     |        |        |                   | as Part of Publicly |       |                 | Yet be Purchased | 
|                |                     | Total Number of     |        |        | Average Price     |                     |       | Announced Plans |                  |  | Under the Plans |       
|Period          |                     | Shares Purchased(a) |        |        | Paid per Share(a) |                     |       | or Programs(b)  |                  |  | or Programs(c)  |       
|                |                     |                     |        |        |                   |                     |       |                 |                  |  |                 |       
|October 1 - 31  |                     |                     |       |        |                   |                     |      |                 |                  |  |                |        |  | $ | 502,688,237 | 
|November 1 - 30 |                     |                     | 1,353  |        |                   |                     | 28.35 |                 |                  |  | 1,353           |        |  | $ | 502,649,880 | 
|December 1 - 31 |                     |                     | 50,092 |        |                   | $                   | 28.86 |                 |                  |  | 50,092          |        |  | $ | 501,857,319 | 
|                |                     |                     |        |        |                   |                     |       |                 |                  |  |                 |       
|                | Fourth quarter 2004 |                     |        | 51,445 |                   |                     | $     | 28.84           |                  |  |                 | 51,445 |  |   |             |  | 
|                |                     |                     |        |        |                   |                     |       |                 |                  |  |                 |       






|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Of the Common Shares repurchased during December 2004, 20,357
    represent Common Shares repurchased in the open market to fund
    Common Shares purchased under our Employee Share Purchase Plan.
    In addition, 2,942 Common Shares repurchased represent Common
    Shares repurchased in the open market to fund fees paid in
    Common Shares to each of our nonemployee trustees, except
    Mr. Zell. In addition, 15 Common Shares repurchased
    represent Common Shares surrendered to Equity Office to satisfy
    tax withholding obligations in connection with the vesting of
    restricted stock issued to employees. The remaining
    26,778 Common Shares represent Common Shares repurchased
    under our open market repurchase program.
|   
|(b) |  | Under our repurchase program announced in July 2002, we may
    repurchase in open market purchases or privately-negotiated
    transactions up to $1.1 billion of our Common Shares
    through May 19, 2005. We also announced that we may
    repurchase Common Shares from time to time to fund our employee
    benefit programs. Such repurchases (other than repurchases made
    on behalf of participants in our 1997 Employee Share Purchase
    Plan, as amended) are considered part of our open market
    repurchase program.                                                                                                                                                                                                                         
|   
|(c) |  | This dollar value relates to the open market repurchase program
    only. The number of Common Shares that may yet be repurchased in
    the open market to fund shares purchased under our 1997 Employee
    Share Purchase Plan, as amended, was 1,446,578 at
    October 31, 2004 and November 30, 2004 and 1,426,221
    at December 31, 2004.                                                                                                                                                                                                                                                                                                                                                                                                                  

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| |                                                                       
| | ----------------------------------------------------------------------
| | Securities Authorized for Issuance under Equity
    Compensation Plans








|        |                         
|------- | ------------------------
|Item 6. | Selected Financial Data.



|                                                                                                         |  |                                               |            |   |      |   |            |      |  |   |            |  |  |         |            |  |  |   |            | 
|-------------------------------------------------------------------------------------------------------- |  | --------------------------------------------- | ---------- | - | ---- | - | ---------- | ---- |  | - | ---------- |  |  | ------- | ---------- |  |  | - | ---------- | 
|                                                                                                         |  | For the years ended December 31,              |           
|                                                                                                         |  |                                               |           
|                                                                                                         |  | 2004(a)                                       |            |   | 2003 |   |            | 2002 |  |   | 2001(b)    |  |  | 2000(c) |           
|                                                                                                         |  |                                               |            |   |      |   |            |      |  |   |            |  |  |         |           
|                                                                                                         |  | (Dollars in thousands, except per share data) |           
|Operating Data:                                                                                          |  |                                               |            |   |      |   |            |      |  |   |            |  |  |         |            |  |  |   |            | 
|Total revenues                                                                                           |  | $                                             | 3,195,851  |   |      | $ | 3,137,151  |      |  | $ | 3,293,568  |  |  | $       | 2,924,361  |  |  | $ | 2,152,945  | 
|Lease termination income(d)                                                                              |  | $                                             | 58,689     |   |      | $ | 68,408     |      |  | $ | 151,969    |  |  | $       | 41,230     |  |  | $ | 19,829     | 
|Property net operating income from continuing operations(e)                                              |  | $                                             | 1,997,127  |   |      | $ | 2,010,652  |      |  | $ | 2,144,274  |  |  | $       | 1,910,519  |  |  | $ | 1,365,116  | 
|Income from continuing operations                                                                        |  | $                                             | 155,716    |   |      | $ | 520,865    |      |  | $ | 633,458    |  |  | $       | 539,737    |  |  | $ | 443,147    | 
|Gain on sales of real estate(d)                                                                          |  | $                                             | 27,374     |   |      | $ | 168,126    |      |  | $ | 18,355     |  |  | $       | 81,662     |  |  | $ | 36,013     | 
|Cumulative effect of a change in accounting principle                                                    |  | $                                             | (33,697    | ) |      |   |           |      |  |   |           |  |  |         |           |  |  |   |           | 
|Net income                                                                                               |  | $                                             | 137,307    |   |      | $ | 655,062    |      |  | $ | 770,215    |  |  | $       | 618,182    |  |  | $ | 470,860    | 
|Net income available to common shareholders                                                              |  | $                                             | 98,214     |   |      | $ | 603,190    |      |  | $ | 707,642    |  |  | $       | 563,796    |  |  | $ | 424,936    | 
|Funds from Operations available to common shareholders plus
    assumed conversions(f)                   |  | $                                             | 931,687    |   |      | $ | 1,289,547  |      |  | $ | 1,520,268  |  |  | $       | 1,190,174  |  |  | $ | 924,907    | 
|Income from continuing operations per share-diluted                                                      |  | $                                             | 0.28       |   |      | $ | 1.20       |      |  | $ | 1.41       |  |  | $       | 1.36       |  |  | $ | 1.43       | 
|Cumulative effect of a change in accounting principle per
    share-diluted                              |  | $                                             | (0.07      | ) |      |   |           |      |  |   |           |  |  |         |           |  |  |   |           | 
|Net income available to common shareholders per share-diluted                                            |  | $                                             | 0.24       |   |      | $ | 1.50       |      |  | $ | 1.70       |  |  | $       | 1.55       |  |  | $ | 1.52       | 
|Funds from Operations available to common shareholders plus
    assumed conversions per share-diluted(f) |  | $                                             | 2.07       |   |      | $ | 2.80       |      |  | $ | 3.18       |  |  | $       | 2.83       |  |  | $ | 2.82       | 
|Cash distributions declared per Common Share                                                             |  | $                                             | 2.00       |   |      | $ | 2.00       |      |  | $ | 2.00       |  |  | $       | 1.90       |  |  | $ | 1.74       | 
|Balance Sheet Data (at end of year):                                                                     |  |                                               |            |   |      |   |            |      |  |   |            |  |  |         |            |  |  |   |            | 
|Total assets                                                                                             |  | $                                             | 24,671,539 |   |      | $ | 24,189,010 |      |  | $ | 25,246,783 |  |  | $       | 25,808,422 |  |  | $ | 18,794,253 | 
|Mortgage debt net of any discounts and premiums                                                          |  | $                                             | 2,609,067  |   |      | $ | 2,315,889  |      |  | $ | 2,507,890  |  |  | $       | 2,650,338  |  |  | $ | 2,915,801  | 
|Unsecured notes net of any premiums and discounts                                                        |  | $                                             | 9,652,392  |   |      | $ | 8,828,912  |      |  | $ | 9,057,651  |  |  | $       | 9,093,987  |  |  | $ | 5,836,193  | 
|Line of Credit                                                                                           |  | $                                             | 548,000    |   |      | $ | 334,000    |      |  | $ | 205,700    |  |  | $       | 244,300    |  |  | $ | 51,000     | 
|Mandatorily Redeemable Preferred Shares                                                                  |  | $                                             | 299,500    |   |      | $ | 299,500    |      |  | $ | 299,500    |  |  | $       | 299,500    |  |  | $ | 300,000    | 

19



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|                                                            |                                                         |                                               |       |       |      |  |      |       |   |  |         |       |   |         |      |       |   |  |   |      |  
|----------------------------------------------------------- | ------------------------------------------------------- | --------------------------------------------- | ----- | ----- | ---- |  | ---- | ----- | - |  | ------- | ----- | - | ------- | ---- | ----- | - |  | - | ---- | -
|                                                            |                                                         | For the years ended December 31,              |      
|                                                            |                                                         |                                               |      
|                                                            |                                                         | 2004(a)                                       |       |       | 2003 |  |      | 2002  |   |  | 2001(b) |       |   | 2000(c) |     
|                                                            |                                                         |                                               |       |       |      |  |      |       |   |  |         |       |   |         |     
|                                                            |                                                         | (Dollars in thousands, except per share data) |      
|Other Data (at end of year):                                |                                                         |                                               |       |       |      |  |      |       |   |  |         |       |   |         |      |       |   |  |   |     
|Total Office Portfolio:                                     |                                                         |                                               |       |       |      |  |      |       |   |  |         |       |   |         |      |       |   |  |   |     
|                                                            | Number of office properties                             |                                               |       | 698   |      |  |      | 684   |   |  |         | 734   |   |         |      | 774   |   |  |   | 381  |  
|                                                            | Rentable square feet of office properties (in millions) |                                               |       | 125.7 |      |  |      | 122.3 |   |  |         | 125.7 |   |         |      | 128.2 |   |  |   | 99.0 |  
|                                                            | Occupancy of office properties                          |                                               |       | 87.7  | %    |  |      | 86.3  | % |  |         | 88.6  | % |         |      | 91.8  | % |  |   | 94.6 | %
|Number of industrial properties                             |                                                         |                                               | 4     |       |      |  | 75   |       |   |  | 77      |       |   |         | 79   |       |   |  |  |     
|Rentable square feet of industrial properties (in millions) |                                                         |                                               | 0.6   |       |      |  | 5.8  |       |   |  | 6.0     |       |   |         | 6.0  |       |   |  |  |     
|Occupancy of industrial properties                          |                                                         |                                               | 100.0 | %     |      |  | 86.6 | %     |   |  | 89.3    | %     |   |         | 92.8 | %     |   |  |  |     






|    |                                                                                                                                                                                                                                                                                                                                                                                       
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | In 2004, we recorded a non-cash impairment charge of
    approximately $229.2 million. See Item 8 
    Note 7.                                                                                                                                                                                                                                                                       
|   
|(b) | On July 2, 2001, we completed our acquisition by merger of
    Spieker Properties, Inc. (Spieker) at a cost of
    approximately $7.2 billion. As a result of the Spieker
    merger, we acquired an interest in 391 office properties
    containing approximately 28.3 million square feet and 98
    industrial properties containing approximately 10.1 million
    square feet.
|   
|(c) | On June 19, 2000, we completed our acquisition by merger of
    Cornerstone Properties Inc. (Cornerstone) at a cost
    of approximately $4.5 billion. As a result of the
    Cornerstone merger, we acquired an interest in 82 office
    properties containing approximately 18.9 million square
    feet.                                                                        
|   
|(d) | These amounts are from continuing and discontinued operations
    and also include our share of unconsolidated joint ventures.                                                                                                                                                                                                                                                        



|    |                                          
|--- | -----------------------------------------
|(e) | See Item 8 Note 18  Segment Information.



|    |                                                                                                                                                                  
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
|(f) | Refer to Item 7 for information regarding why we present
    funds from operations and for a reconciliation of this non-GAAP
    financial measure to net income.






|        |                                                                                           
|------- | ------------------------------------------------------------------------------------------
|Item 7. | Managements Discussion and Analysis of Financial
    Condition and Results of Operations.



Overview






| |   |                      
| | - | ---------------------
| |  | Results of Operations

| |                                                                                                     
| | ----------------------------------------------------------------------------------------------------
| | Period-to-period comparisons of our results of operations for
    the years ended 2002 through 2004.



| |   |                                
| | - | -------------------------------
| |  | Liquidity and Capital Resources

| |                                                                                                                                                                                                                                                                                                          
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | A discussion of our liquidity and capital resources,
    including distributions to our shareholders and unitholders,
    contractual obligations, debt financing, market risk, capital
    improvements, tenant improvements, leasing costs, developments,
    cash flows and additional items for 2004.



| |   |                                           
| | - | ------------------------------------------
| |  | Critical Accounting Policies and Estimates

| |                                                                                                                                                
| | -----------------------------------------------------------------------------------------------------------------------------------------------
| | A review of the critical accounting policies and estimates
    that affect the financial statements and impact of new
    accounting standards.

20



---



##### Table of Contents





| |   |                      
| | - | ---------------------
| |  | Funds From Operations

| |                                                                                                                  
| | -----------------------------------------------------------------------------------------------------------------
| | A reconciliation of this non-GAAP financial measure to net
    income, the most directly comparable GAAP measure.

Executive Summary










| |   |                                               
| | - | ----------------------------------------------
| |  | Economic Environment                          
|
| |  | Leasing Results for the Total Office Portfolio
|
| |  | Investment Activity                           
|
| |  | Cash Requirements                             



| |                     
| | --------------------
| | Economic Environment







21



---



##### Table of Contents





| |                                               
| | ----------------------------------------------
| | Leasing Results for the Total Office Portfolio












| |                    
| | -------------------
| | Investment Activity



22



---



##### Table of Contents





| |                  
| | -----------------
| | Cash Requirements



Key Transactions Completed in 2004




| |                     
| | --------------------
| | Investing Activities



| |   |                                                                                                                                                                                                                
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We acquired $952.0 million in assets, or partial interests
    therein, consisting of 27 office properties comprising
    approximately 3.3 million square feet and four vacant land
    parcels;              
|
| |  | disposed of five office properties, comprising approximately
    .6 million square feet, and partial interests in three
    office properties, and one vacant land parcel for approximately
    $252.2 million;
|
| |  | disposed of 71 industrial properties, which was substantially
    our entire industrial property portfolio, comprising
    approximately 5.1 million square feet for approximately
    $432.0 million; and     
|
| |  | disposed of our investment in shares of Capital Trust for
    approximately $32.1 million.                                                                                                                     



| |                     
| | --------------------
| | Financing Activities





| |   |                                                                                                                                                                                                                         
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We issued approximately $1.8 billion of fixed interest rate
    unsecured notes and $245 million of variable interest rate
    unsecured notes in several offerings, and repaid
    $1.2 billion of unsecured notes; and
|
| |  | repaid approximately $444.3 million of mortgage debt.                                                                                                                                                                   





| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We settled $800 million of forward-starting interest rate
    swaps for a payment of approximately $69.1 million and then
    entered into several fixed-to-floating interest rate swaps that
    effectively converted the 5.54% fixed interest rate on
    $1.0 billion of unsecured notes issued in March 2004 to a
    floating rate of LIBOR plus 122 basis points (which
    includes 79 basis points for loan costs); and
|
| |  | settled five forward-starting interest rate swaps with a
    combined notional amount of $500 million resulting in a
    gain of approximately $24.0 million. The swaps were entered
    into in 2003 to hedge an unsecured notes offering that was
    expected to take place in June 2004, but did not occur.                                                                                                                 



| |      
| | -----
| | Other



| |   |                                                                                                                                                                                                                                                                                           
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We recorded a non-cash impairment charge of approximately
    $229.2 million on 46 non-core assets;                                                                                                                                                                                       
|
| |  | redeemed the
    85/8%
    Series C Cumulative Redeemable Preferred Shares of
    Beneficial Interest for approximately $114.1 million;                                                                                                                                                   
|
| |  | consolidated the assets, liabilities and results of operations
    of the SunAmerica Center office property as of January 1,
    2004 in accordance with FIN 46(R) and recognized a
    cumulative effect of a change in accounting principle loss of
    approximately $33.7 million; and
|
| |  | consolidated the assets, liabilities and results of operations
    of the Concar office property in accordance with FIN 46(R).                                                                                                                                                            

23



---



##### Table of Contents



Results of Operations


Trends in Occupancy and Rental Rates for the Total Office
Portfolio




|                             |                                                                                 |                                                                                                          |                  |            |      |       |  |            |   |       | 
|---------------------------- | ------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------- | ---------------- | ---------- | ---- | ----- |  | ---------- | - | ----- | 
|                             |                                                                                 | For the years ended                                                                                      |                 
|                             |                                                                                 | December 31,                                                                                             |                 
|                             |                                                                                 |                                                                                                          |                 
|                             |                                                                                 | 2004                                                                                                     |                  |            | 2003 |      
|                             |                                                                                 |                                                                                                          |                  |            |      |      
|Total Office Portfolio Data: |                                                                                 |                                                                                                          |                  |            |      |       |  |           
|10 Largest Markets:          |                                                                                 |                                                                                                          |                  |            |      |       |  |           
|                             | Portion of Total Office Portfolio based on square feet at end of
    year       |                                                                                                          |                  | 69.7       | %    |       |  | 69.4       | %
|                             | Occupancy at end of year                                                        |                                                                                                          |                  | 87.8       | %    |       |  | 86.1       | %
|                             | Gross square footage for tenants whose lease term commenced
    during the year |                                                                                                          |                  | 14,686,887 |      |       |  | 15,218,840 |  
|                             |                                                                                 | Weighted average annual rent per square foot for tenants whose
    lease term commenced during the year: |                  |            |      |       |  |            |   |      
|                             |                                                                                 |                                                                                                          | GAAP basis(a)(b) |            | $    | 26.13 |  |            | $ | 27.93 | 
|                             |                                                                                 |                                                                                                          | Cash basis(b)(c) |            | $    | 25.33 |  |            | $ | 26.99 | 
|                             | Gross square footage for expiring and terminated leases during
    the year     |                                                                                                          |                  | 13,520,700 |      |       |  | 15,932,288 |  
|                             |                                                                                 | Weighted average annual rent per square foot for expiring and
    terminated leases during the year:     |                  |            |      |       |  |            |   |      
|                             |                                                                                 |                                                                                                          | GAAP basis(a)    |            | $    | 29.80 |  |            | $ | 31.12 | 
|                             |                                                                                 |                                                                                                          | Cash basis(c)    |            | $    | 30.73 |  |            | $ | 31.50 | 
|Total Office Portfolio:      |                                                                                 |                                                                                                          |                  |            |      |       |  |           
|                             | Occupancy at end of year                                                        |                                                                                                          |                  | 87.7       | %    |       |  | 86.3       | %
|                             | Gross square footage for tenants whose lease term commenced
    during the year |                                                                                                          |                  | 22,015,441 |      |       |  | 22,684,488 |  
|                             |                                                                                 | Weighted average annual rent per square foot for tenants whose
    lease term commenced during the year: |                  |            |      |       |  |            |   |      
|                             |                                                                                 |                                                                                                          | GAAP basis(a)(b) |            | $    | 24.10 |  |            | $ | 25.68 | 
|                             |                                                                                 |                                                                                                          | Cash basis(b)(c) |            | $    | 23.38 |  |            | $ | 24.86 | 
|                             | Gross square footage for expiring and terminated leases during
    the year     |                                                                                                          |                  | 20,381,369 |      |       |  | 23,976,592 |  
|                             |                                                                                 | Weighted average annual rent per square foot for expiring and
    terminated leases during the year:     |                  |            |      |       |  |            |   |      
|                             |                                                                                 |                                                                                                          | GAAP basis(a)    |            | $    | 27.14 |  |            | $ | 28.14 | 
|                             |                                                                                 |                                                                                                          | Cash basis(c)    |            | $    | 27.94 |  |            | $ | 28.55 | 






|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | These weighted average GAAP rental rates are based on the
    average annual base rent per square foot over the term of each
    lease and the current estimated tenant reimbursements, if any.                                                                                                                                                                                                                                                                                                                                                     
|   
|(b) |  | Weighted average annual rent per square foot for new office
    leases for tenants whose lease term commenced during the period
    may lag behind market because leasing decisions typically are
    made anywhere from one month to 12 or more months prior to
    taking occupancy.                                                                                                                                                                                                                                                              
|   
|(c) |  | These weighted average annual cash rental rates are based on the
    monthly contractual rent when the lease commenced, expired or
    terminated. For new and renewal leases, if the monthly
    contractual rent when the lease commenced is $0 then the rental
    rate represents the first monthly rent payment due multiplied by
    12 months (Annualized Cash Rent). This amount
    reflects total base rent and estimated current period expense
    reimbursements without regard to any rent concessions and
    contractual increases

24



---



##### Table of Contents



| |  |                                                                                                                                                                                                                                         
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | or decreases in rent after the lease commences. We believe
    Annualized Cash Rent is a useful measure because this
    information can be used for comparison to current market rents
    as published by various third party sources.



| |                             
| | ----------------------------
| | Period-to-Period Comparisons



| |                                     
| | ------------------------------------
| | Acquisition and Disposition Activity



|                        |                                    |                        |     |     |                       |  |             |            |   |  |             |     |   |  |           |            |  
|----------------------- | ---------------------------------- | ---------------------- | --- | --- | --------------------- |  | ----------- | ---------- | - |  | ----------- | --- | - |  | --------- | ---------- | -
|                        |                                    | Total Office Portfolio |     |     | Industrial Properties | 
|                        |                                    |                        |     |     |                       | 
|                        |                                    | Buildings              |     |     | Square Feet           |  |             | Buildings  |   |  | Square Feet |    
|                        |                                    |                        |     |     |                       |  |             |            |   |  |             |    
|Properties owned as of: |                                    |                        |     |     |                       |  |             |            |   |  |             |     |   |  |           |           
|December 31, 2002       |                                    |                        | 734 |     |                       |  | 125,725,399 |            |   |  | 77          |     |   |  | 5,967,759 |           
|                        | Acquisitions                       |                        |     | 2   |                       |  |             | 829,293    |   |  |             |    |   |  |           |           |  
|                        | Developments placed in service     |                        |     | 5   |                       |  |             | 1,218,215  |   |  |             |    |   |  |           |           |  
|                        | Dispositions(a)                    |                        |     | (53 | )                     |  |             | (5,182,707 | ) |  |             | (2  | ) |  |           | (216,900   | )
|                        | Properties taken out of service(b) |                        |     | (4  | )                     |  |             | (450,548   | ) |  |             |    |   |  |           |           |  
|                        | Building remeasurements            |                        |     |    |                       |  |             | 115,273    |   |  |             |    |   |  |           |           |  
|                        |                                    |                        |     |     |                       |  |             |            |   |  |             |    
|December 31, 2003       |                                    |                        | 684 |     |                       |  | 122,254,925 |            |   |  | 75          |     |   |  | 5,750,859 |           
|                        | Consolidation of SunAmerica Center |                        |     | 1   |                       |  |             | 780,063    |   |  |             |    |   |  |           |           |  
|                        | Acquisitions                       |                        |     | 27  |                       |  |             | 3,315,232  |   |  |             |    |   |  |           |           |  
|                        | Developments placed in service     |                        |     | 2   |                       |  |             | 298,689    |   |  |             |    |   |  |           |           |  
|                        | Dispositions(a)                    |                        |     | (5  | )                     |  |             | (567,765   | ) |  |             | (71 | ) |  |           | (5,136,014 | )
|                        | Properties taken out of service(b) |                        |     | (11 | )                     |  |             | (469,771   | ) |  |             |    |   |  |           |           |  
|                        | Building remeasurements            |                        |     |    |                       |  |             | 101,872    |   |  |             |    |   |  |           | 1,875      |  
|                        |                                    |                        |     |     |                       |  |             |            |   |  |             |    
|December 31, 2004       |                                    |                        | 698 |     |                       |  | 125,713,245 |            |   |  | 4           |     |   |  | 616,720   |           
|                        |                                    |                        |     |     |                       |  |             |            |   |  |             |    






|    |  |                                                                                                                                                                                 
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Excludes any partial sales of real estate because the properties
    are still included in our portfolio statistics and accounted for
    under the equity method of accounting.
|   
|(b) |  | Properties taken out of service represent office properties we
    are no longer attempting to lease.                                                                           

Results of Operations






| |   |                                                                                                                                                                                                                     
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the consolidation of 1301 Avenue of the Americas, SunAmerica
    Center and Concar in 2004;                                                                                                                         
|
| |  | the consolidation of Key Center in the third quarter of 2003;                                                                                                                                                       
|
| |  | the acquisition of two office buildings comprising approximately
    0.8 million square feet in 2003 and 27 office
    buildings comprising approximately 3.3 million square feet
    in 2004;                      
|
| |  | certain developments placed in service; and                                                                                                                                                                         
|
| |  | the disposition of 55 properties comprising approximately
    5.4 million square feet and the sale of majority interests
    in 13 properties (which are now accounted for under the
    equity method) in 2003; the

25



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##### Table of Contents



| |  |                                                                                                                                                    
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------
| |  | sale of majority interests in two properties and the disposition
    of 76 properties comprising approximately 5.7 million
    square feet in 2004.



Comparison of the year ended December 31, 2004 to the
year ended December 31, 2003




|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |           |           |           |          |         |         |          |       |         |       |       |  
|--------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------- | ---------------------------- | ---------------- | --------- | -------------------- | ------- | ------- | --------- | --------- | --------- | -------- | ------- | ------- | -------- | ----- | ------- | ---- | ----- | ------- | --------- | --------- | ------- | --------- | --------- | --------- | --------- | -------- | ------- | ------- | -------- | ----- | ------- | ----- | ----- | -
|                                                                                                                                                                |                                                                                  | Total Company                |                  |           | Same Store Portfolio |        
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |        
|                                                                                                                                                                |                                                                                  |                              |                  | Change    |                      |         |         |           | Change    |          
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |          
|                                                                                                                                                                |                                                                                  | 2004                         |                  |           | 2003                 |         |         | $         |           |           | %        |         |         | 2004     |       |         | 2003 |       |         | $         |           |         | %         |          
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |          
|                                                                                                                                                                |                                                                                  | (Dollars in thousands)       |                 
|Revenues:                                                                                                                                                       |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |           |           |           |          |         |         |          |       |        
|                                                                                                                                                                | Property operating revenues                                                      |                              | $                | 3,181,625 |                      |         | $       | 3,121,290 |           |           | $        | 60,335  |         |          |       | 1.9     | %    |       | $       | 2,884,776 |           |         | $         | 2,952,670 |           |           | $        | (67,894 | )       |          |       | (2.3    | )%   
|                                                                                                                                                                | Fee income                                                                       |                              |                  | 14,226    |                      |         |         | 15,861    |           |           |          | (1,635  | )       |          |       | (10.3   | )    |       |         |          |           |         |           |          |           |           |          |        |         |          |       |        |      
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |          
|                                                                                                                                                                |                                                                                  | Total revenues               |                  |           | 3,195,851            |         |         |           | 3,137,151 |           |          |         | 58,700  |          |       |         | 1.9  |       |         |           | 2,884,776 |         |           |           | 2,952,670 |           |          |         | (67,894 | )        |       |         | (2.3  | )    
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |          
|Expenses:                                                                                                                                                       |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |           |           |           |          |         |         |          |       |        
|                                                                                                                                                                | Depreciation and amortization                                                    |                              |                  | 783,685   |                      |         |         | 701,914   |           |           |          | 81,771  |         |          |       | 11.6    |      |       |         | 697,176   |           |         |           | 645,802   |           |           |          | 51,374  |         |          |       | 8.0     |      
|                                                                                                                                                                | Real estate taxes                                                                |                              |                  | 367,610   |                      |         |         | 344,625   |           |           |          | 22,985  |         |          |       | 6.7     |      |       |         | 329,462   |           |         |           | 319,870   |           |           |          | 9,592   |         |          |       | 3.0     |      
|                                                                                                                                                                | Property operating expenses                                                      |                              |                  | 816,888   |                      |         |         | 766,013   |           |           |          | 50,875  |         |          |       | 6.6     |      |       |         | 750,806   |           |         |           | 725,676   |           |           |          | 25,130  |         |          |       | 3.5     |      
|                                                                                                                                                                | Ground rent                                                                      |                              |                  | 25,467    |                      |         |         | 20,287    |           |           |          | 5,180   |         |          |       | 25.5    |      |       |         | 18,818    |           |         |           | 18,624    |           |           |          | 194     |         |          |       | 1.0     |      
|                                                                                                                                                                | General and administrative(a)                                                    |                              |                  | 52,242    |                      |         |         | 62,479    |           |           |          | (10,237 | )       |          |       | (16.4   | )    |       |         |          |           |         |           |          |           |           |          |        |         |          |       |        |      
|                                                                                                                                                                | Impairment                                                                       |                              |                  | 228,272   |                      |         |         | 7,500     |           |           |          | 220,772 |         |          |       | 2,943.6 |      |       |         | 193,595   |           |         |           | 7,500     |           |           |          | 186,095 |         |          |       | 2,481.3 |      
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |          
|                                                                                                                                                                |                                                                                  | Total expenses               |                  |           | 2,274,164            |         |         |           | 1,902,818 |           |          |         | 371,346 |          |       |         | 19.5 |       |         |           | 1,989,857 |         |           |           | 1,717,472 |           |          |         | 272,385 |          |       |         | 15.9  |      
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |          
|                                                                                                                                                                |                                                                                  |                              | Operating income |           |                      | 921,687 |         |           |           | 1,234,333 |          |         |         | (312,646 | )     |         |      | (25.3 | )       |           |           | 894,919 |           |           |           | 1,235,198 |          |         |         | (340,279 | )     |         |       | (27.5 | )
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |          
|Other income (expense):                                                                                                                                         |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |           |           |           |          |         |         |          |       |        
|                                                                                                                                                                | Interest and dividend income                                                     |                              |                  | 8,302     |                      |         |         | 12,580    |           |           |          | (4,278  | )       |          |       | (34.0   | )    |       |         | 3,306     |           |         |           | 3,647     |           |           |          | (341    | )       |          |       | (9.4    | )    
|                                                                                                                                                                | Realized gain on settlement of derivatives and sale of
    marketable securities |                              |                  | 28,976    |                      |         |         | 9,286     |           |           |          | 19,690  |         |          |       | 212.0   |      |       |         |          |           |         |           |          |           |           |          |        |         |          |       |        |      
|                                                                                                                                                                | Interest expense(b)                                                              |                              |                  | (850,722  | )                    |         |         | (826,706  | )         |           |          | (24,016 | )       |          |       | 2.9     |      |       |         | (158,311  | )         |         |           | (185,599  | )         |           |          | 27,288  |         |          |       | (14.7   | )    
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |          
|                                                                                                                                                                |                                                                                  | Total other income (expense) |                  |           | (813,444             | )       |         |           | (804,840  | )         |          |         | (8,604  | )        |       |         | 1.1  |       |         |           | (155,005  | )       |           |           | (181,952  | )         |          |         | 26,947  |          |       |         | (14.8 | )    
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |          
|Income before income taxes, allocation to minority interests,
    income from investments in unconsolidated joint ventures and
    gain on sales of real estate |                                                                                  |                              | 108,243          |           |                      |         | 429,493 |           |           |           | (321,250 | )       |         |          | (74.8 | )       |      |       | 739,914 |           |           |         | 1,053,246 |           |           |           | (313,332 | )       |         |          | (29.7 | )      
|Income taxes                                                                                                                                                    |                                                                                  |                              | (2,012           | )         |                      |         | (5,388  | )         |           |           | 3,376    |         |         |          | (62.7 | )       |      |       | (336    | )         |           |         | (772      | )         |           |           | 436      |         |         |          | (56.5 | )      
|Minority interests:                                                                                                                                             |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |           |           |           |          |         |         |          |       |        
|                                                                                                                                                                | EOP Partnership                                                                  |                              |                  | (11,747   | )                    |         |         | (74,152   | )         |           |          | 62,405  |         |          |       | (84.2   | )    |       |         |          |           |         |           |          |           |           |          |        |         |          |       |        |      
|                                                                                                                                                                | Partially owned properties                                                       |                              |                  | (10,973   | )                    |         |         | (8,080    | )         |           |          | (2,893  | )       |          |       | 35.8    |      |       |         | (10,263   | )         |         |           | (9,271    | )         |           |          | (992    | )       |          |       | 10.7    |      
|Income from investments in unconsolidated joint ventures                                                                                                        |                                                                                  |                              | 50,304           |           |                      |         | 79,882  |           |           |           | (29,578  | )       |         |          | (37.0 | )       |      |       | 30,663  |           |           |         | 42,387    |           |           |           | (11,724  | )       |         |          | (27.7 | )      
|Gain on sales of real estate                                                                                                                                    |                                                                                  |                              | 21,901           |           |                      |         | 99,110  |           |           |           | (77,209  | )       |         |          | (77.9 | )       |      |       |        |           |           |         |          |           |           |           |         |         |         |          |      |        
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |          
|Income from continuing operations                                                                                                                               |                                                                                  |                              | 155,716          |           |                      |         | 520,865 |           |           |           | (365,149 | )       |         |          | (70.1 | )       |      |       | 759,978 |           |           |         | 1,085,590 |           |           |           | (325,612 | )       |         |          | (30.0 | )      
|Discontinued operations (including net gain on sales of real
    estate of $5,473 and $61,953, respectively)                                                    |                                                                                  |                              | 15,288           |           |                      |         | 134,197 |           |           |           | (118,909 | )       |         |          | (88.6 | )       |      |       |        |           |           |         |          |           |           |           |         |         |         |          |      |        
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |          
|Income before cumulative effect of a change in accounting
    principle                                                                                         |                                                                                  |                              | 171,004          |           |                      |         | 655,062 |           |           |           | (484,058 | )       |         |          | (73.9 | )       |      |       |        |           |           |         |          |           |           |           |         |         |         |          |      |        
|Cumulative effect of a change in accounting principle                                                                                                           |                                                                                  |                              | (33,697          | )         |                      |         |        |           |           |           | (33,697  | )       |         |          |      |         |      |       |        |           |           |         |          |           |           |           |         |         |         |          |      |        
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |          
|Net income                                                                                                                                                      |                                                                                  | $                            | 137,307          |           |                      | $       | 655,062 |           |           | $         | (517,755 | )       |         |          | (79.0 | )%      |      | $     | 759,978 |           |           | $       | 1,085,590 |           |           | $         | (325,612 | )       |         |          | (30.0 | )%     
|                                                                                                                                                                |                                                                                  |                              |                  |           |                      |         |         |           |           |           |          |         |         |          |       |         |      |       |         |           |           |         |           |          

26



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|                |                                                             |                        |   |           |                      |  |   |           |        |  |   |         |   |      |  |       |      |  |   |           |  |  |   |           |  |  |   |          |   |  |  |       |   
|--------------- | ----------------------------------------------------------- | ---------------------- | - | --------- | -------------------- |  | - | --------- | ------ |  | - | ------- | - | ---- |  | ----- | ---- |  | - | --------- |  |  | - | --------- |  |  | - | -------- | - |  |  | ----- | --
|                |                                                             | Total Company          |   |           | Same Store Portfolio | 
|                |                                                             |                        |   |           |                      | 
|                |                                                             |                        |   | Change    |                      |  |   |           | Change | 
|                |                                                             |                        |   |           |                      |  |   |           |        | 
|                |                                                             | 2004                   |   |           | 2003                 |  |   | $         |        |  | % |         |   | 2004 |  |       | 2003 |  |   | $         |  |  | % |          
|                |                                                             |                        |   |           |                      |  |   |           |        |  |   |         |   |      |  |       |      |  |   |           |  |  |   |          
|                |                                                             | (Dollars in thousands) |  
|Selected Items: |                                                             |                        |   |           |                      |  |   |           |        |  |   |         |   |      |  |       |      |  |   |           |  |  |   |           |  |  |   |          |   |  |  |      
|                | Property net operating income from continuing operations(c) |                        | $ | 1,997,127 |                      |  | $ | 2,010,652 |        |  | $ | (13,525 | ) |      |  | (0.7  | )%   |  | $ | 1,804,508 |  |  | $ | 1,907,124 |  |  | $ | (102,616 | ) |  |  | (5.4  | )%
|                |                                                             |                        |   |           |                      |  |   |           |        |  |   |         |   |      |  |       |      |  |   |           |  |  |   |          
|                | Deferred rental revenue                                     |                        | $ | 79,548    |                      |  | $ | 71,866    |        |  | $ | 7,682   |   |      |  | 10.7  | %    |  | $ | 60,813    |  |  | $ | 68,048    |  |  | $ | (7,235   | ) |  |  | (10.6 | )%
|                |                                                             |                        |   |           |                      |  |   |           |        |  |   |         |   |      |  |       |      |  |   |           |  |  |   |          
|                | Lease termination fees                                      |                        | $ | 52,866    |                      |  | $ | 62,199    |        |  | $ | (9,333  | ) |      |  | (15.0 | )%   |  | $ | 38,489    |  |  | $ | 60,211    |  |  | $ | (21,722  | ) |  |  | (36.1 | )%
|                |                                                             |                        |   |           |                      |  |   |           |        |  |   |         |   |      |  |       |      |  |   |           |  |  |   |          






|    |  |                                                                                                                                                                                                                                                                                             
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Corporate general and administrative expense is not allocated to
    the Same Store Portfolio because these expenses are not directly
    incurred in connection with any specific property.                                                                                                
|   
|(b) |  | Interest expense (including amortization of deferred financing
    costs and prepayment expenses) for the Same Store Portfolio
    represents interest expense on property secured mortgage debt
    and does not include interest expense on the unsecured notes or
    the line of credit.
|   
|(c) |  | Represents segment data. See Item 8 
    Note 18.                                                                                                                                                                                                                                          

Property Operating Revenues






Depreciation and Amortization






Real Estate Taxes






27



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##### Table of Contents



Property Operating Expenses






Ground Rent




General and Administrative Expenses




Impairment




Interest and Dividend Income




Realized Gain on Settlement of Derivatives and Sale of
Marketable Securities






Interest Expense






28



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##### Table of Contents



Income from Investments in Unconsolidated Joint Ventures






Gain on Sales of Real Estate




Discontinued Operations




Cumulative Effect of a Change in Accounting Principle




29



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##### Table of Contents



Comparison of the year ended December 31, 2003 to the
year ended December 31, 2002




|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |           |           |           |          |          |          |          |       |      |      |       |  
|--------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------- | -------------------------------- | ---------------- | --------- | -------------------- | --------- | ------- | --------- | --------- | --------- | -------- | -------- | -------- | -------- | ----- | ----- | ---- | ----- | --------- | --------- | --------- | --------- | --------- | --------- | --------- | --------- | -------- | -------- | -------- | -------- | ----- | ---- | ---- | ----- | -
|                                                                                                                                                                |                                                                                  | Total Company                    |                  |           | Same Store Portfolio |          
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |          
|                                                                                                                                                                |                                                                                  |                                  |                  | Change    |                      |           |         |           | Change    |          
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |          
|                                                                                                                                                                |                                                                                  | 2003                             |                  |           | 2002                 |           |         | $         |           |           | %        |          |          | 2003     |       |       | 2002 |       |           | $         |           |           | %         |          
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |          
|                                                                                                                                                                |                                                                                  | (Dollars in thousands)           |                 
|Revenues:                                                                                                                                                       |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |           |           |           |          |          |          |          |       |     
|                                                                                                                                                                | Property operating revenues                                                      |                                  | $                | 3,121,290 |                      |           | $       | 3,277,661 |           |           | $        | (156,371 | )        |          |       | (4.8  | )%   |       | $         | 3,138,385 |           |           | $         | 3,323,859 |           |           | $        | (185,474 | )        |          |       | (5.6 | )%  
|                                                                                                                                                                | Fee income                                                                       |                                  |                  | 15,861    |                      |           |         | 15,907    |           |           |          | (46      | )        |          |       | (0.3  | )    |       |           |          |           |           |           |          |           |           |          |         |          |          |       |     |     
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |          
|                                                                                                                                                                |                                                                                  | Total revenues                   |                  |           | 3,137,151            |           |         |           | 3,293,568 |           |          |          | (156,417 | )        |       |       | (4.7 | )     |           |           | 3,138,385 |           |           |           | 3,323,859 |           |          |          | (185,474 | )        |       |      | (5.6 | )    
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |          
|Expenses:                                                                                                                                                       |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |           |           |           |          |          |          |          |       |     
|                                                                                                                                                                | Depreciation and
    amortization                                                |                                  |                  | 701,914   |                      |           |         | 650,185   |           |           |          | 51,729   |          |          |       | 8.0   |      |       |           | 689,611   |           |           |           | 648,531   |           |           |          | 41,080   |          |          |       | 6.3  |     
|                                                                                                                                                                | Real estate taxes                                                                |                                  |                  | 344,625   |                      |           |         | 353,090   |           |           |          | (8,465   | )        |          |       | (2.4  | )    |       |           | 344,257   |           |           |           | 356,730   |           |           |          | (12,473  | )        |          |       | (3.5 | )   
|                                                                                                                                                                | Property operating expenses                                                      |                                  |                  | 766,013   |                      |           |         | 780,297   |           |           |          | (14,284  | )        |          |       | (1.8  | )    |       |           | 759,568   |           |           |           | 782,195   |           |           |          | (22,627  | )        |          |       | (2.9 | )   
|                                                                                                                                                                | Ground rent                                                                      |                                  |                  | 20,287    |                      |           |         | 20,325    |           |           |          | (38      | )        |          |       | (0.2  | )    |       |           | 18,624    |           |           |           | 20,075    |           |           |          | (1,451   | )        |          |       | (7.2 | )   
|                                                                                                                                                                | General and administrative(a)                                                    |                                  |                  | 62,479    |                      |           |         | 65,790    |           |           |          | (3,311   | )        |          |       | (5.0  | )    |       |           |          |           |           |           |          |           |           |          |         |          |          |       |     |     
|                                                                                                                                                                | Impairment                                                                       |                                  |                  | 7,500     |                      |           |         |          |           |           |          | 7,500    |          |          |       |      |      |       |           | 7,500     |           |           |           |          |           |           |          | 7,500    |          |          |       |     |     
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |          
|                                                                                                                                                                |                                                                                  | Total expenses                   |                  |           | 1,902,818            |           |         |           | 1,869,687 |           |          |          | 33,131   |          |       |       | 1.8  |       |           |           | 1,819,560 |           |           |           | 1,807,531 |           |          |          | 12,029   |          |       |      | 0.7  |      
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |          
|                                                                                                                                                                |                                                                                  |                                  | Operating income |           |                      | 1,234,333 |         |           |           | 1,423,881 |          |          |          | (189,548 | )     |       |      | (13.3 | )         |           |           | 1,318,825 |           |           |           | 1,516,328 |          |          |          | (197,503 | )     |      |      | (13.0 | )
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |          
|Other income (expense):                                                                                                                                         |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |           |           |           |          |          |          |          |       |     
|                                                                                                                                                                | Interest and dividend
    income                                                 |                                  |                  | 12,580    |                      |           |         | 22,148    |           |           |          | (9,568   | )        |          |       | (43.2 | )    |       |           | 3,839     |           |           |           | 3,771     |           |           |          | 68       |          |          |       | 1.8  |     
|                                                                                                                                                                | Realized gain on settlement of derivatives and sale of
    marketable securities |                                  |                  | 9,286     |                      |           |         |          |           |           |          | 9,286    |          |          |       |      |      |       |           |          |           |           |           |          |           |           |          |         |          |          |       |     |     
|                                                                                                                                                                | Interest expense(b)                                                              |                                  |                  | (826,706  | )                    |           |         | (813,997  | )         |           |          | (12,709  | )        |          |       | 1.6   |      |       |           | (187,259  | )         |           |           | (198,110  | )         |           |          | 10,851   |          |          |       | (5.5 | )   
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |          
|                                                                                                                                                                |                                                                                  | Total other income
    (expense) |                  |           | (804,840             | )         |         |           | (791,849  | )         |          |          | (12,991  | )        |       |       | 1.6  |       |           |           | (183,420  | )         |           |           | (194,339  | )         |          |          | 10,919   |          |       |      | (5.6 | )    
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |          
|Income before income taxes, allocation to minority interests,
    income from investments in unconsolidated joint ventures and
    gain on sales of real estate |                                                                                  |                                  | 429,493          |           |                      |           | 632,032 |           |           |           | (202,539 | )        |          |          | (32.0 | )     |      |       | 1,135,405 |           |           |           | 1,321,989 |           |           |           | (186,584 | )        |          |          | (14.1 | )   
|Income taxes                                                                                                                                                    |                                                                                  |                                  | (5,388           | )         |                      |           | (9,101  | )         |           |           | 3,713    |          |          |          | (40.8 | )     |      |       | (911      | )         |           |           | (1,999    | )         |           |           | 1,088    |          |          |          | (54.4 | )   
|Minority interests:                                                                                                                                             |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |           |           |           |          |          |          |          |       |     
|                                                                                                                                                                | EOP Partnership                                                                  |                                  |                  | (74,152   | )                    |           |         | (89,205   | )         |           |          | 15,053   |          |          |       | (16.9 | )    |       |           |          |           |           |           |          |           |           |          |         |          |          |       |     |     
|                                                                                                                                                                | Partially owned properties                                                       |                                  |                  | (8,080    | )                    |           |         | (7,120    | )         |           |          | (960     | )        |          |       | 13.5  |      |       |           | (9,307    | )         |           |           | (7,253    | )         |           |          | (2,054   | )        |          |       | 28.3 |     
|Income from investments in unconsolidated joint ventures                                                                                                        |                                                                                  |                                  | 79,882           |           |                      |           | 106,852 |           |           |           | (26,970  | )        |          |          | (25.2 | )     |      |       | 53,131    |           |           |           | 68,630    |           |           |           | (15,499  | )        |          |          | (22.6 | )   
|Gain on sales of real
    estate                                                                                                                                |                                                                                  |                                  | 99,110           |           |                      |           |        |           |           |           | 99,110   |          |          |          |      |       |      |       | 99,110    |           |           |           |          |           |           |           | 99,110   |          |          |          |      |     
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |          
|Income from continuing
    operations                                                                                                                           |                                                                                  |                                  | 520,865          |           |                      |           | 633,458 |           |           |           | (112,593 | )        |          |          | (17.8 | )     |      |       | 1,277,428 |           |           |           | 1,381,367 |           |           |           | (103,939 | )        |          |          | (7.5  | )   
|Discontinued operations (including net gain on sales of real
    estate of $61,953 and $17,926, respectively)                                                   |                                                                                  |                                  | 134,197          |           |                      |           | 136,757 |           |           |           | (2,560   | )        |          |          | (1.9  | )     |      |       |          |           |           |           |          |           |           |           |         |          |          |          |      |     
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |          
|Net income                                                                                                                                                      |                                                                                  | $                                | 655,062          |           |                      | $         | 770,215 |           |           | $         | (115,153 | )        |          |          | (15.0 | )%    |      | $     | 1,277,428 |           |           | $         | 1,381,367 |           |           | $         | (103,939 | )        |          |          | (7.5  | )%  
|                                                                                                                                                                |                                                                                  |                                  |                  |           |                      |           |         |           |           |           |          |          |          |          |       |       |      |       |           |           |           |           |           |          

30



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##### Table of Contents



|                |                                                             |                        |   |           |                      |  |   |           |        |  |   |          |   |      |  |       |      |  |   |           |  |  |   |           |  |  |   |          |   |  |  |       |   
|--------------- | ----------------------------------------------------------- | ---------------------- | - | --------- | -------------------- |  | - | --------- | ------ |  | - | -------- | - | ---- |  | ----- | ---- |  | - | --------- |  |  | - | --------- |  |  | - | -------- | - |  |  | ----- | --
|                |                                                             | Total Company          |   |           | Same Store Portfolio | 
|                |                                                             |                        |   |           |                      | 
|                |                                                             |                        |   | Change    |                      |  |   |           | Change | 
|                |                                                             |                        |   |           |                      |  |   |           |        | 
|                |                                                             | 2003                   |   |           | 2002                 |  |   | $         |        |  | % |          |   | 2003 |  |       | 2002 |  |   | $         |  |  | % |          
|                |                                                             |                        |   |           |                      |  |   |           |        |  |   |          |   |      |  |       |      |  |   |           |  |  |   |          
|                |                                                             | (Dollars in thousands) |  
|Selected Items: |                                                             |                        |   |           |                      |  |   |           |        |  |   |          |   |      |  |       |      |  |   |           |  |  |   |           |  |  |   |          |   |  |  |      
|                | Property net operating income from continuing operations(c) |                        | $ | 2,010,652 |                      |  | $ | 2,144,274 |        |  | $ | (133,622 | ) |      |  | (6.2  | )%   |  | $ | 2,034,560 |  |  | $ | 2,184,934 |  |  | $ | (150,374 | ) |  |  | (6.9  | )%
|                |                                                             |                        |   |           |                      |  |   |           |        |  |   |          |   |      |  |       |      |  |   |           |  |  |   |          
|                | Deferred rental revenue                                     |                        | $ | 71,866    |                      |  | $ | 65,476    |        |  | $ | 6,390    |   |      |  | 9.8   | %    |  | $ | 70,298    |  |  | $ | 66,451    |  |  | $ | 3,847    |   |  |  | 5.8   | % 
|                |                                                             |                        |   |           |                      |  |   |           |        |  |   |          |   |      |  |       |      |  |   |           |  |  |   |          
|                | Lease termination fees                                      |                        | $ | 62,199    |                      |  | $ | 103,063   |        |  | $ | (40,864  | ) |      |  | (39.6 | )%   |  | $ | 62,110    |  |  | $ | 103,469   |  |  | $ | (41,359  | ) |  |  | (40.0 | )%
|                |                                                             |                        |   |           |                      |  |   |           |        |  |   |          |   |      |  |       |      |  |   |           |  |  |   |          






|    |  |                                                                                                                                                                                                                                                                                             
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Corporate general and administrative expense is not allocated to
    the Same Store Portfolio because these expenses are not directly
    incurred in connection with any specific property.                                                                                                
|   
|(b) |  | Interest expense (including amortization of deferred financing
    costs and prepayment expenses) for the Same Store Portfolio
    represents interest expense on property secured mortgage debt
    and does not include interest expense on the unsecured notes or
    the line of credit.
|   
|(c) |  | Represents segment data. See Item 8 
    Note 18.                                                                                                                                                                                                                                          

Property Operating Revenues




Depreciation and Amortization




Real Estate Taxes




Property Operating Expenses




General and Administrative Expenses




31



---



##### Table of Contents





Impairment




Interest and Dividend Income




Realized Gain on Settlement of Derivatives and Sale of
Marketable Securities




Interest Expense






Income Taxes




Income from Investments in Unconsolidated Joint Ventures




Gain on Sales of Real Estate




Discontinued Operations




32



---



##### Table of Contents





Liquidity and Capital Resources


Liquidity
















33



---



##### Table of Contents





Distributions




|                             |  |                        |         |  |                        |   |        | 
|---------------------------- |  | ---------------------- | ------- |  | ---------------------- | - | ------ | 
|                             |  | Annualized             |         |  | 2004 Distributions     |  
|Security                     |  | Distribution Per Share |         |  | (Dollars in thousands) |  
|                             |  |                        |         |  |                        |  
|Series B Preferred Shares    |  | $                      | 2.625   |  |                        | $ | 15,724 | 
|Series C Preferred Shares(a) |  | $                      | 2.15625 |  |                        | $ | 164    | 
|Series G Preferred Shares    |  | $                      | 1.9375  |  |                        | $ | 16,469 | 






|    |                                                             
|--- | ------------------------------------------------------------
|(a) | The Series C Preferred Shares were redeemed in January 2004.



Contractual Obligations




|                                                        |                               |                        |           |            |      |   |           |           |  |   |         |           |  |      |         |           |      |   |         |            |  |   |         |           |  |   |           |           | 
|------------------------------------------------------- | ----------------------------- | ---------------------- | --------- | ---------- | ---- | - | --------- | --------- |  | - | ------- | --------- |  | ---- | ------- | --------- | ---- | - | ------- | ---------- |  | - | ------- | --------- |  | - | --------- | --------- | 
|                                                        |                               | Payments Due by Period |          
|                                                        |                               |                        |          
|                                                        |                               | Total                  |           |            | 2005 |   |           | 2006      |  |   | 2007    |           |  | 2008 |         |           | 2009 |   |         | Thereafter | 
|                                                        |                               |                        |           |            |      |   |           |           |  |   |         |           |  |      |         |           |      |   |         |            | 
|                                                        |                               | (Dollars in thousands) |          
|Mortgage debt(1)                                        |                               | $                      | 2,622,750 |            |      | $ | 1,099,649 |           |  | $ | 286,130 |           |  | $    | 239,745 |           |      | $ | 134,964 |            |  | $ | 563,308 |           |  | $ | 298,954   |          
|Unsecured notes(2)                                      |                               |                        | 9,690,754 |            |      |   | 675,000   |           |  |   | 652,924 |           |  |      | 977,010 |           |      |   | 475,294 |            |  |   | 850,430 |           |  |   | 6,060,096 |          
|Line of Credit                                          |                               |                        | 548,000   |            |      |   |          |           |  |   | 548,000 |           |  |      |        |           |      |   |        |            |  |   |        |           |  |   |          |          
|Series B Preferred Shares                               |                               |                        | 299,500   |            |      |   |          |           |  |   |        |           |  |      |        |           |      |   | 299,500 |            |  |   |        |           |  |   |          |          
|Share of mortgage debt of unconsolidated joint ventures |                               |                        | 361,032   |            |      |   | 31,770    |           |  |   | 52,283  |           |  |      | 4,069   |           |      |   | 18,691  |            |  |   | 11,721  |           |  |   | 242,498   |          
|Operating lease obligations                             |                               |                        | 1,445,529 |            |      |   | 22,782    |           |  |   | 22,641  |           |  |      | 22,481  |           |      |   | 22,643  |            |  |   | 22,712  |           |  |   | 1,332,270 |          
|Share of ground leases of unconsolidated joint ventures |                               |                        | 34,418    |            |      |   | 564       |           |  |   | 564     |           |  |      | 564     |           |      |   | 564     |            |  |   | 564     |           |  |   | 31,598    |          
|                                                        |                               |                        |           |            |      |   |           |           |  |   |         |           |  |      |         |           |      |   |         |            | 
|                                                        | Total Contractual Obligations |                        | $         | 15,001,983 |      |   | $         | 1,829,765 |  |   | $       | 1,562,542 |  |      | $       | 1,243,869 |      |   | $       | 951,656    |  |   | $       | 1,448,735 |  |   | $         | 7,965,416 | 
|                                                        |                               |                        |           |            |      |   |           |           |  |   |         |           |  |      |         |           |      |   |         |            | 






|    |                                                                  
|--- | -----------------------------------------------------------------
|(1) | Balance excludes a net unamortized discount of
    $13.7 million.





| |                                      
| | -------------------------------------
| | Fixed-to-Floating Interest Rate Swaps





| |                 
| | ----------------
| | Energy Contracts



34



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##### Table of Contents







| |                               
| | ------------------------------
| | Off-Balance Sheet Arrangements



Debt Financing




| |                  
| | -----------------
| | Consolidated Debt



|                                         |                  |                                       |                          |       |           |            |            |      |           |            |            |  
|---------------------------------------- | ---------------- | ------------------------------------- | ------------------------ | ----- | --------- | ---------- | ---------- | ---- | --------- | ---------- | ---------- | -
|                                         |                  | December 31,                          |                         
|                                         |                  |                                       |                         
|                                         |                  | 2004                                  |                          |       | 2003      |           
|                                         |                  |                                       |                          |       |           |           
|                                         |                  | (Dollars in thousands)                |                         
|Balance                                  |                  |                                       |                          |       |           |            |            |     
|                                         | Fixed rate:      |                                       |                          |       |           |            |            |      |          
|                                         |                  | Mortgage debt(a)                      |                          | $     | 2,502,871 |            |            | $    | 2,279,889 |           
|                                         |                  | Unsecured notes(b)                    |                          |       | 8,439,016 |            |            |      | 8,828,912 |           
|                                         |                  |                                       |                          |       |           |           
|                                         |                  |                                       | Total fixed rate debt    |       |           | 10,941,887 |            |      |           | 11,108,801 |           
|                                         |                  |                                       |                          |       |           |           
|                                         | Variable rate:   |                                       |                          |       |           |            |            |      |          
|                                         |                  | Mortgage debt(a)                      |                          |       | 106,196   |            |            |      | 36,000    |           
|                                         |                  | Unsecured notes and line of credit(b) |                          |       | 1,761,376 |            |            |      | 334,000   |           
|                                         |                  |                                       |                          |       |           |           
|                                         |                  |                                       | Total variable rate debt |       |           | 1,867,572  |            |      |           | 370,000    |           
|                                         |                  |                                       |                          |       |           |           
|                                         |                  |                                       |                          | Total |           | $          | 12,809,459 |      |           | $          | 11,478,801 |  
|                                         |                  |                                       |                          |       |           |           
|Percent of total debt                    |                  |                                       |                          |       |           |            |            |     
|                                         | Fixed rate       |                                       |                          | 85.4  | %         |            |            | 96.8 | %        
|                                         | Variable rate(c) |                                       |                          | 14.6  | %         |            |            | 3.2  | %        
|                                         |                  |                                       |                          |       |           |           
|                                         |                  |                                       | Total                    |       |           | 100.0      | %          |      |           | 100.0      | %         
|                                         |                  |                                       |                          |       |           |           
|Effective interest rate at end of period |                  |                                       |                          |       |           |            |            |     
|                                         | Fixed rate:      |                                       |                          |       |           |            |            |      |          
|                                         |                  | Mortgage debt                         |                          |       | 7.80      | %          |            |      | 7.72      | %         
|                                         |                  | Unsecured notes                       |                          |       | 6.87      | %          |            |      | 6.95      | %         
|                                         |                  |                                       |                          |       |           |           
|                                         |                  |                                       | Effective interest rate  |       |           | 7.09       | %          |      |           | 7.11       | %         
|                                         |                  |                                       |                          |       |           |           
|                                         | Variable rate:   |                                       |                          |       |           |            |            |      |          
|                                         |                  | Mortgage debt                         |                          |       | 5.53      | %          |            |      | 1.72      | %         
|                                         |                  | Unsecured notes and line of credit    |                          |       | 3.75      | %          |            |      | 1.95      | %         
|                                         |                  |                                       |                          |       |           |           
|                                         |                  |                                       | Effective interest rate  |       |           | 3.85       | %          |      |           | 1.93       | %         
|                                         |                  |                                       |                          |       |           |           
|                                         |                  |                                       |                          | Total |           |            | 6.61       | %    |           |            | 6.94       | %
|                                         |                  |                                       |                          |       |           |           






|    |                                                                                                                                                                                                           
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | The increase in total mortgage debt of approximately
    $293.2 million from December 31, 2003 to
    December 31, 2004 was primarily due to the consolidation of
    SunAmerica Center and 1301 Avenue of

35



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##### Table of Contents



|    |                                                                                                                                                                                                                                                                                                                                                                                          
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | the Americas. These two properties were encumbered by
    approximately $737.5 million of mortgage debt when they
    were consolidated. This increase was partially offset by
    $444.3 million of repayments.                                                                                                                                                                         
|   
|(b) | The increase in unsecured notes and line of credit was due to
    the issuance of $2.1 billion of new notes and
    $214.0 million of net borrowings on the line of credit.
    These increases were partially offset by $1.2 billion of
    note repayments and additional discounts on the notes primarily
    due to mark-to-market adjustments on fair value interest rate
    swaps.
|   
|(c) | The variable rate debt as of December 31, 2004 includes
    $1.0 billion of fixed rate unsecured notes that were
    converted to a variable rate based on LIBOR plus 122 basis
    points through several interest rate swap agreements entered
    into in March 2004. The interest rates for the remaining
    variable rate debt are based on various spreads over LIBOR.            



| |                                           
| | ------------------------------------------
| | Unconsolidated Joint Venture Mortgage Debt







| |               
| | --------------
| | Line of Credit







| |                                 
| | --------------------------------
| | Bridge Revolving Credit Facility





36



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##### Table of Contents





| |                
| | ---------------
| | Unsecured Notes



|                        |                                                   |                        |      |      |           |  |      |           |   |   |               |           |  |  |                     |  | 
|----------------------- | ------------------------------------------------- | ---------------------- | ---- | ---- | --------- |  | ---- | --------- | - | - | ------------- | --------- |  |  | ------------------- |  | 
|                        |                                                   | Coupon                 |      |      | Effective |  |      | Principal |   |   |              
|Original Term           |                                                   | Rate                   |      |      | Rate(a)   |  |      | Balance   |   |   | Maturity Date |          
|                        |                                                   |                        |      |      |           |  |      |           |   |   |               |          
|                        |                                                   | (Dollars in thousands) |     
|Fixed interest rate:    |                                                   |                        |      |      |           |  |      |           |   |   |               |           |  |  |                     | 
|8 Years                 |                                                   |                        | 6.88 | %    |           |  | 6.40 | %         |   | $ | 125,000       |           |  |  | 02/01/05            | 
|7 Years                 |                                                   |                        | 6.63 | %    |           |  | 4.99 | %         |   |   | 400,000       |           |  |  | 02/15/05            | 
|7 Years                 |                                                   |                        | 8.00 | %    |           |  | 6.49 | %         |   |   | 100,000       |           |  |  | 07/19/05            | 
|8 Years                 |                                                   |                        | 7.36 | %    |           |  | 7.69 | %         |   |   | 50,000        |           |  |  | 09/01/05            | 
|6 Years                 |                                                   |                        | 8.38 | %    |           |  | 7.65 | %         |   |   | 500,000       |           |  |  | 03/15/06            | 
|9 Years                 |                                                   |                        | 7.44 | %    |           |  | 7.74 | %         |   |   | 50,000        |           |  |  | 09/01/06            | 
|10 Years                |                                                   |                        | 7.13 | %    |           |  | 6.74 | %         |   |   | 100,000       |           |  |  | 12/01/06            | 
|9 Years                 |                                                   |                        | 7.00 | %    |           |  | 6.80 | %         |   |   | 1,500         |           |  |  | 02/02/07            | 
|9 Years                 |                                                   |                        | 6.88 | %    |           |  | 6.83 | %         |   |   | 25,000        |           |  |  | 04/30/07            | 
|9 Years                 |                                                   |                        | 6.76 | %    |           |  | 6.76 | %         |   |   | 300,000       |           |  |  | 06/15/07            | 
|10 Years                |                                                   |                        | 7.41 | %    |           |  | 7.70 | %         |   |   | 50,000        |           |  |  | 09/01/07            | 
|7 Years                 |                                                   |                        | 7.75 | %    |           |  | 7.91 | %         |   |   | 600,000       |           |  |  | 11/15/07            | 
|10 Years                |                                                   |                        | 6.75 | %    |           |  | 6.97 | %         |   |   | 150,000       |           |  |  | 01/15/08            | 
|10 Years                |                                                   |                        | 6.75 | %    |           |  | 7.01 | %         |   |   | 300,000       |           |  |  | 02/15/08            | 
|10 Years                |                                                   |                        | 6.80 | %    |           |  | 6.94 | %         |   |   | 500,000       |           |  |  | 01/15/09            | 
|10 Years                |                                                   |                        | 7.25 | %    |           |  | 7.14 | %         |   |   | 200,000       |           |  |  | 05/01/09            | 
|11 Years                |                                                   |                        | 7.13 | %    |           |  | 6.97 | %         |   |   | 150,000       |           |  |  | 07/01/09            | 
|10 Years                |                                                   |                        | 8.10 | %    |           |  | 8.22 | %         |   |   | 360,000       |           |  |  | 08/01/10            | 
|6 Years                 |                                                   |                        | 4.65 | %    |           |  | 4.81 | %         |   |   | 800,000       |           |  |  | 10/01/10            | 
|10 Years                |                                                   |                        | 7.65 | %    |           |  | 7.20 | %         |   |   | 200,000       |           |  |  | 12/15/10            | 
|10 Years                |                                                   |                        | 7.00 | %    |           |  | 6.83 | %         |   |   | 1,100,000     |           |  |  | 07/15/11            | 
|10 Years                |                                                   |                        | 6.75 | %    |           |  | 7.02 | %         |   |   | 500,000       |           |  |  | 02/15/12            | 
|10 Years                |                                                   |                        | 5.88 | %    |           |  | 5.98 | %         |   |   | 500,000       |           |  |  | 01/15/13            | 
|20 Years                |                                                   |                        | 7.88 | %    |           |  | 8.08 | %         |   |   | 25,000        |           |  |  | 12/01/16            | 
|20 Years                |                                                   |                        | 7.35 | %    |           |  | 8.08 | %         |   |   | 200,000       |           |  |  | 12/01/17            | 
|20 Years                |                                                   |                        | 7.25 | %    |           |  | 7.54 | %         |   |   | 250,000       |           |  |  | 02/15/18            | 
|30 Years                |                                                   |                        | 7.50 | %    |           |  | 8.24 | %         |   |   | 150,000       |           |  |  | 10/01/27            | 
|30 Years                |                                                   |                        | 7.25 | %    |           |  | 7.31 | %         |   |   | 225,000       |           |  |  | 06/15/28            | 
|30 Years                |                                                   |                        | 7.50 | %    |           |  | 7.55 | %         |   |   | 200,000       |           |  |  | 04/19/29            | 
|30 Years                |                                                   |                        | 7.88 | %    |           |  | 7.94 | %         |   |   | 300,000       |           |  |  | 07/15/31            | 
|EOP InterNotes(b)       |                                                   |                        | 4.31 | %    |           |  | 4.55 | %         |   |   | 34,254        |           |  |  | 11/15/06 - 01/15/11 | 
|                        |                                                   |                        |      |      |           |  |      |           |   |   |               |          
|                        | Total/Weighted Average Unsecured Fixed Rate Notes |                        |      | 6.94 | %         |  |      | 6.87      | % |   |               | 8,445,754 |  |  |                     |  | 
|                        |                                                   |                        |      |      |           |  |      |           |   |   |               |          
|Variable-interest rate: |                                                   |                        |      |      |           |  |      |           |   |   |               |           |  |  |                     | 
|6 Years                 |                                                   |                        | 2.64 | %    |           |  | 2.77 | %         |   |   | 200,000       |           |  |  | 10/01/10            | 
|10 Years(c)             |                                                   |                        | 4.75 | %    |           |  | 4.25 | %         |   |   | 1,000,000     |           |  |  | 03/15/14            | 

37



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##### Table of Contents



|              |                                                      |                        |      |      |           |  |      |           |         |  |                     |         |           |  |          |  |  | 
|------------- | ---------------------------------------------------- | ---------------------- | ---- | ---- | --------- |  | ---- | --------- | ------- |  | ------------------- | ------- | --------- |  | -------- |  |  | 
|              |                                                      | Coupon                 |      |      | Effective |  |      | Principal |         |  |                    
|Original Term |                                                      | Rate                   |      |      | Rate(a)   |  |      | Balance   |         |  | Maturity Date       |        
|              |                                                      |                        |      |      |           |  |      |           |         |  |                     |        
|              |                                                      | (Dollars in thousands) |     
|10 Years      |                                                      |                        | 3.16 | %    |           |  | 3.26 | %         |         |  | 45,000              |         |           |  | 05/27/14 | 
|              |                                                      |                        |      |      |           |  |      |           |         |  |                     |        
|              | Total/Weighted Average Unsecured Variable Rate Notes |                        |      | 4.35 | % 6.60%   |  |      | 3.98      | % 6.50% |  | 1,245,000 9,690,754 |         |           |  |         
|              | Total/Weighted Average                               |                        |      |      |           |  |      |           |         |  |                     | (38,362 | )         |  |          |  | 
|              |                                                      | Net discount           |      |      |           |  |      |           |         |  |                     | $       | 9,652,392 |  |          |  |  | 
|              |                                                      | Total                  |      |      |           |  |      |           |         |  |                     |         |           |  |          |  |  | 
|              |                                                      |                        |      |      |           |  |      |           |         |  |                     |        






|    |                                                                                                                                                                                                                                
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | Includes the effect of settled and outstanding interest rate
    protection and interest rate swap agreements, offering and
    transaction costs and premiums and discounts on certain
    unsecured notes.                   
|   
|(b) | The rates shown are weighted average rates. The coupon rates on
    the EOP InterNotes range from 3.30% to 5.25%. Including all
    offering expenses, the effective rates of the EOP InterNotes
    range from 3.61% to 5.46%.
|   
|(c) | In March 2004, we entered into several interest rate swap
    agreements that effectively converted these notes to a variable
    interest rate based on the 6-month LIBOR rate.                                               





| |                                                        
| | -------------------------------------------------------
| | Restrictions and Covenants under Unsecured Indebtedness





|                                                                                                             |  |                    |      | 
|------------------------------------------------------------------------------------------------------------ |  | ------------------ | ---- | 
|Covenants(a) (in each case as defined in the respective indenture)                                           |  | Actual Performance |     
|                                                                                                             |  |                    |     
|Debt to Adjusted Total Assets may not be greater than 60%                                                    |  |                    | 49%  | 
|Secured Debt to Adjusted Total Assets may not be greater than 40%                                            |  |                    | 11%  | 
|Consolidated Income Available for Debt Service to Annual Debt
    Service Charge may not be less than 1.50:1 |  |                    | 2.4  | 
|Total Unencumbered Assets to Unsecured Debt may not be less than
    150%(a)                                 |  |                    | 204% | 



|    |                                                                                                                                                                                                     
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | The unsecured notes we assumed in the merger with Spieker
    Partnership, of which approximately $1.4 billion are
    outstanding at December 31, 2004, are subject to a minimum
    ratio of 165%.

38



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##### Table of Contents





| |                  
| | -----------------
| | Equity Securities



|                                 |                                                                 |               |             |            |       |  |            |            |   |  |             |            |  
|-------------------------------- | --------------------------------------------------------------- | ------------- | ----------- | ---------- | ----- |  | ---------- | ---------- | - |  | ----------- | ---------- | -
|                                 |                                                                 | Common Shares |             |            | Units |  |            | Total      |  
|                                 |                                                                 |               |             |            |       |  |            |            |  
|Outstanding at December 31, 2003 |                                                                 |               | 400,460,388 |            |       |  | 49,032,230 |            |   |  | 449,492,618 |           
|                                 | Share options exercised                                         |               |             | 2,489,462  |       |  |            |           |   |  |             | 2,489,462  |  
|                                 | Common Shares repurchased/retired(a)                            |               |             | (1,413,230 | )     |  |            |           |   |  |             | (1,413,230 | )
|                                 | Units redeemed for Common Shares, cash and other                |               |             | 1,390,129  |       |  |            | (1,539,459 | ) |  |             | (149,330   | )
|                                 | Units issued(b)                                                 |               |             |           |       |  |            | 1,930      |   |  |             | 1,930      |  
|                                 | Restricted shares and share awards issued, net of cancellations |               |             | 915,692    |       |  |            |           |   |  |             | 915,692    |  
|                                 |                                                                 |               |             |            |       |  |            |            |  
|Outstanding at December 31, 2004 |                                                                 |               | 403,842,441 |            |       |  | 47,494,701 |            |   |  | 451,337,142 |           
|                                 |                                                                 |               |             |            |       |  |            |            |  






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | In July 2002, we announced a Common Share repurchase program
    allowing for the repurchase of up to $200 million of Common
    Shares in the open market or privately-negotiated transactions.
    This amount was later increased to $1.1 billion. Common
    Shares repurchased to fund employee benefit programs are not
    considered part of the repurchase program. During the year ended
    December 31, 2004, 1,413,230 Common Shares were repurchased
    at an average price of $26.19 for approximately
    $37.0 million in the aggregate. An additional 25,728 Common
    Shares were repurchased during December 2004 at an average price
    of $29.63 for approximately $0.8 million, but were not yet
    retired as of December 31, 2004 and are still outstanding.
    Since the inception of the program in 2002, approximately
    23.6 million Common Shares have been repurchased at an
    average price of $25.37 for approximately $598.1 million.
|   
|(b) | During 2004, we issued Units in connection with the purchase of
    a partners interest in the 500 Orange office property. The
    total value of the Units was approximately $50,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

Market Risk




| |                                          
| | -----------------------------------------
| | Qualitative Information About Market Risk



Quantitative
Information About Market Risk




| |                   
| | ------------------
| | Interest Rate Risk



39



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##### Table of Contents





|                  |  |                          |                         |           |                  |             |              |             |                  |         |  |   |       |  |  |         |  |   |       |  |  |        
|----------------- |  | ------------------------ | ----------------------- | --------- | ---------------- | ----------- | ------------ | ----------- | ---------------- | ------- |  | - | ----- |  |  | ------- |  | - | ----- |  |  | -------
|                  |  |                          |                         |           |                  |             |              | (Decrease)/
|                  |  |                          |                         | Increase/ |                  | (Decrease)/ |              | Increase   
|                  |  | Hypothetical change in   |                         |           | (Decrease)       |             | Increase Net |             | Fair Value      
|As of             |  | market rates of interest |                         |           | Interest Expense |             | Income       |             | of Total Debt(a)
|                  |  |                          |                         |           |                  |             |              |             |                 
|December 31, 2004 |  |                          | +10% or 27 basis points |           |                  | $           | 5.1          |             |                  | million |  | $ | (5.1) |  |  | million |  | $ | (258) |  |  | million
|                  |  |                          | -10% or 27 basis points |           |                  | $           | (5.1)        |             |                  | million |  | $ | 5.1   |  |  | million |  | $ | 272   |  |  | million
|December 31, 2003 |  |                          | +10% or 12 basis points |           |                  | $           | 0.4          |             |                  | million |  | $ | (0.4) |  |  | million |  | $ | (213) |  |  | million
|                  |  |                          | -10% or 12 basis points |           |                  | $           | (0.4)        |             |                  | million |  | $ | 0.4   |  |  | million |  | $ | 223   |  |  | million






|    |                                                                                                                                                                                                                                                                                                                                     
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | As of December 31, 2004 and 2003, the fair value of our
    fixed-rate debt was approximately $1.1 billion and
    $1.3 billion higher than the book value of approximately
    $10.9 billion and $11.1 billion, respectively,
    primarily due to the general decrease in market interest rates
    on secured and unsecured debt.



| |                                                                                    
| | -----------------------------------------------------------------------------------
| | Interest Rate Risk  Forward-Starting and
    Fixed-to-Floating Interest Rate Swaps







Capital Improvements, Tenant Improvements and Leasing
Costs




| |                     
| | --------------------
| | Capital Improvements





| |   |                                                                                                                                                                                                                                                                                                                                           
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Capital Improvements  costs for improvements
    that enhance the value of the property such as lobby
    renovations, roof replacement, significant renovations for
    Americans with Disabilities Act compliance, chiller replacement
    and elevator upgrades.                                                                      
|
| |  | Development and Redevelopment Costs  costs
    associated with the development or redevelopment of a property
    including tenant improvements, leasing commissions, capitalized
    interest and operating costs incurred during completion of the
    property and incurred while the property is made ready for its
    intended use.

40



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##### Table of Contents





|                      |                           |                                  |   |                |             |  |   |              |                |  |             |        |         |                |   |       |             |  |   |        |         |  |   |         |         | 
|--------------------- | ------------------------- | -------------------------------- | - | -------------- | ----------- |  | - | ------------ | -------------- |  | ----------- | ------ | ------- | -------------- | - | ----- | ----------- |  | - | ------ | ------- |  | - | ------- | ------- | 
|                      |                           | For the years ended December 31, |  
|                      |                           |                                  |  
|                      |                           | 2004                             |   |                | 2003        |  |   | 2002         |               
|                      |                           |                                  |   |                |             |  |   |              |               
|                      |                           |                                  |   | Unconsolidated |             |  |   |              | Unconsolidated |  |             |        |         | Unconsolidated |  
|                      |                           | Consolidated                     |   |                | Properties  |  |   | Consolidated |                |  | Properties  |        |         | Consolidated   |   |       | Properties  | 
|                      |                           | Properties                       |   |                | (our share) |  |   | Properties   |                |  | (our share) |        |         | Properties     |   |       | (our share) | 
|                      |                           |                                  |   |                |             |  |   |              |                |  |             |        |         |                |   |       |             | 
|                      |                           | (Dollars in thousands)           |  
|Capital Improvements: |                           |                                  |   |                |             |  |   |              |                |  |             |        |         |                |   |       |             |  |   |        |         |  |   |        
|                      | Capital improvements      |                                  | $ | 70,594         |             |  | $ | 6,387        |                |  | $           | 64,052 |         |                | $ | 9,222 |             |  | $ | 46,662 |         |  | $ | 4,544   |        
|                      | Development costs         |                                  |   | 50,815         |             |  |   |             |                |  |             | 96,736 |         |                |   | 5,538 |             |  |   | 92,214 |         |  |   | 110,244 |        
|                      | Redevelopment costs(a)(b) |                                  |   | 787            |             |  |   |             |                |  |             | 8,391  |         |                |   |      |             |  |   | 32,976 |         |  |   |        |        
|                      |                           |                                  |   |                |             |  |   |              |                |  |             |        |         |                |   |       |             | 
|                      |                           | Total capital improvements       |   | $              | 122,196     |  |   | $            | 6,387          |  |             | $      | 169,179 |                |   | $     | 14,760      |  |   | $      | 171,852 |  |   | $       | 114,788 | 
|                      |                           |                                  |   |                |             |  |   |              |                |  |             |        |         |                |   |       |             | 






|    |                                                                                                                                                                    
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | Properties included in redevelopment costs for 2003 are Tabor
    Center, Polk and Taylor Buildings and Worldwide Plaza (amenities
    area).                      
|   
|(b) | Properties included in redevelopment costs for 2002 are 500-600
    City Parkway, Tabor Center, Polk and Taylor Buildings and
    Worldwide Plaza (amenities area).



| |                                      
| | -------------------------------------
| | Tenant Improvements and Leasing Costs



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|                                                         |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |   |         |     |  |   |       | 
|-------------------------------------------------------- |  | ----------------------------------------------------- | ------- | ---------- | ----------- | - | ----- | ----------- | ---------- | - | ----------- | --- |  | ----------- | ----- |  | ----------- | - | ------- | --- |  | - | ----- | 
|                                                         |  | For the years ended December 31,                      |        
|                                                         |  |                                                       |        
|                                                         |  | 2004                                                  |         |            | 2003        |   |       | 2002        |           
|                                                         |  |                                                       |         |            |             |   |       |             |           
|                                                         |  |                                                       |         | Total Cost |             |   |       |             | Total Cost |   |             |     |  | Total Cost  |      
|                                                         |  |                                                       |         | per Square |             |   |       |             | per Square |   |             |     |  | per Square  |      
|                                                         |  | Total Costs                                           |         |            | Foot Leased |   |       | Total Costs |            |   | Foot Leased |     |  | Total Costs |       |  | Foot Leased |  
|                                                         |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |  
|                                                         |  | (Dollars in thousands except per square foot amounts) |        
|Consolidated Properties:                                 |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |   |         |     |  |   |       | 
|Office Properties:                                       |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |   |         |     |  |   |       | 
|Renewals                                                 |  | $                                                     | 97,214  |            |             | $ | 11.62 |             |            | $ | 128,673     |     |  | $           | 13.07 |  |             | $ | 69,710  |     |  | $ | 8.14  | 
|Retenanted                                               |  |                                                       | 259,506 |            |             |   | 23.45 |             |            |   | 248,364     |     |  |             | 24.31 |  |             |   | 183,231 |     |  |   | 18.43 | 
|                                                         |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |  
|Total/ Weighted Average                                  |  | $                                                     | 356,720 |            |             | $ | 18.36 |             |            | $ | 377,037     |     |  | $           | 18.79 |  |             | $ | 252,941 |     |  | $ | 13.67 | 
|                                                         |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |  
|Industrial Properties:                                   |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |   |         |     |  |   |       | 
|Renewals                                                 |  | $                                                     | 1,623   |            |             | $ | 2.24  |             |            | $ | 1,153       |     |  | $           | 3.10  |  |             | $ | 2,540   |     |  | $ | 2.13  | 
|Retenanted                                               |  |                                                       | 2,961   |            |             |   | 5.96  |             |            |   | 2,213       |     |  |             | 3.78  |  |             |   | 1,153   |     |  |   | 3.66  | 
|                                                         |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |  
|Total/ Weighted Average                                  |  | $                                                     | 4,584   |            |             | $ | 3.75  |             |            | $ | 3,366       |     |  | $           | 3.51  |  |             | $ | 3,693   |     |  | $ | 2.45  | 
|                                                         |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |  
|Unconsolidated Joint Ventures:                           |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |   |         |     |  |   |       | 
|Renewals                                                 |  | $                                                     | 12,330  | (a)        |             | $ | 21.95 |             |            | $ | 17,936      | (a) |  | $           | 24.09 |  |             | $ | 2,203   | (a) |  | $ | 7.80  | 
|Retenanted                                               |  |                                                       | 12,576  | (a)        |             |   | 30.65 |             |            |   | 8,026       | (a) |  |             | 23.21 |  |             |   | 4,265   | (a) |  |   | 14.07 | 
|                                                         |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |  
|Total/ Weighted Average                                  |  | $                                                     | 24,906  | (a)        |             | $ | 25.62 |             |            | $ | 25,962      | (a) |  | $           | 23.81 |  |             | $ | 6,468   | (a) |  | $ | 11.05 | 
|                                                         |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |  
|Total Properties (renewals and retenanted
    combined): |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |   |         |     |  |   |       | 
|Office (consolidated and unconsolidated)                 |  | $                                                     | 381,626 |            |             | $ | 18.70 |             |            | $ | 402,999     |     |  | $           | 19.05 |  |             | $ | 259,409 |     |  | $ | 13.59 | 
|Industrial                                               |  |                                                       | 4,584   |            |             |   | 3.75  |             |            |   | 3,366       |     |  |             | 3.51  |  |             |   | 3,693   |     |  |   | 2.45  | 
|                                                         |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |  
|Total/ Weighted Average                                  |  | $                                                     | 386,210 |            |             | $ | 17.86 |             |            | $ | 406,365     |     |  | $           | 18.38 |  |             | $ | 263,102 |     |  | $ | 12.77 | 
|                                                         |  |                                                       |         |            |             |   |       |             |            |   |             |     |  |             |       |  |             |  






|    |                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------
|(a) | Represents our share of unconsolidated joint venture tenant
    improvements and leasing costs for office properties.





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|                                                                                                             |                       |                                                                                                                                |         |         |         |   |         |         |         |   |         |         |         | 
|------------------------------------------------------------------------------------------------------------ | --------------------- | ------------------------------------------------------------------------------------------------------------------------------ | ------- | ------- | ------- | - | ------- | ------- | ------- | - | ------- | ------- | ------- | 
|                                                                                                             |                       | For the years ended December 31,                                                                                               |        
|                                                                                                             |                       |                                                                                                                                |        
|                                                                                                             |                       | 2004                                                                                                                           |         |         | 2003    |   |         | 2002    |        
|                                                                                                             |                       |                                                                                                                                |         |         |         |   |         |         |        
|                                                                                                             |                       | (Dollars in thousands)                                                                                                         |        
|Capital Improvements                                                                                         |                       | $                                                                                                                              | 70,594  |         |         | $ | 64,052  |         |         | $ | 46,662  |        
|Tenant Improvements and Leasing Costs:                                                                       |                       |                                                                                                                                |         |         |         |   |         |         |         |   |         |        
|                                                                                                             | Office Properties     |                                                                                                                                |         | 356,720 |         |   |         | 377,037 |         |   |         | 252,941 |        
|                                                                                                             | Industrial Properties |                                                                                                                                |         | 4,584   |         |   |         | 3,366   |         |   |         | 3,693   |        
|Expenditures for corporate furniture, fixtures and equipment,
    software, leasehold improvements and other |                       |                                                                                                                                | 10,726  |         |         |   | 32,397  |         |         |   | 5,251   |        
|                                                                                                             |                       |                                                                                                                                |         |         |         |   |         |         |        
|                                                                                                             |                       | Subtotal                                                                                                                       |         |         | 442,624 |   |         |         | 476,852 |   |         |         | 308,547 | 
|Development costs                                                                                            |                       |                                                                                                                                | 50,815  |         |         |   | 96,736  |         |         |   | 92,214  |        
|Redevelopment costs                                                                                          |                       |                                                                                                                                | 787     |         |         |   | 8,391   |         |         |   | 32,976  |        
|Timing differences                                                                                           |                       |                                                                                                                                | 82,038  |         |         |   | (4,399  | )       |         |   | (93     | )      
|                                                                                                             |                       |                                                                                                                                |         |         |         |   |         |         |        
|                                                                                                             |                       | Total capital improvements, tenant improvements and leasing costs                                                              |         | $       | 576,264 |   |         | $       | 577,580 |   |         | $       | 433,644 | 
|                                                                                                             |                       |                                                                                                                                |         |         |         |   |         |         |        
|Capital and tenant improvements from consolidated statement of
    cash flows                                |                       | $                                                                                                                              | 453,227 |         |         | $ | 438,601 |         |         | $ | 328,930 |        
|Lease commissions and other costs from consolidated statement of
    cash flows                              |                       |                                                                                                                                | 123,037 |         |         |   | 138,979 |         |         |   | 104,714 |        
|                                                                                                             |                       |                                                                                                                                |         |         |         |   |         |         |        
|                                                                                                             |                       | Total capital improvements, tenant improvements and leasing
    costs as disclosed on the consolidated statement of cash flows |         | $       | 576,264 |   |         | $       | 577,580 |   |         | $       | 433,644 | 
|                                                                                                             |                       |                                                                                                                                |         |         |         |   |         |         |        

Developments




|                             |  |                 |         |  |          |  |               |           |  |                        |      |  |          |         |         |           |          |   |            |        |  |   |        |  |  |  |    |  
|---------------------------- |  | --------------- | ------- |  | -------- |  | ------------- | --------- |  | ---------------------- | ---- |  | -------- | ------- | ------- | --------- | -------- | - | ---------- | ------ |  | - | ------ |  |  |  | -- | -
|                             |  |                 |         |  |          |  |               |           |  | Costs                  |      |  | Total    |         |         | Current   |         
|                             |  | Placed in       |         |  |          |  | Number of     |           |  | Square                 |      |  | Incurred |         |         | Estimated |          |   | Percentage |       
|                             |  | Service Date(a) |         |  | Location |  |               | Buildings |  |                        | Feet |  |          | To Date |         |           | Costs(b) |   |            | Leased | 
|                             |  |                 |         |  |          |  |               |           |  |                        |      |  |          |         |         |           |          |   |            |        | 
|                             |  |                 |         |  |          |  |               |           |  | (Dollars in thousands) |     
|Cambridge Science
    Center |  |                 | 2Q/2004 |  |          |  | Cambridge, MA |           |  |                        | 1    |  |          |         | 131,000 |           |          | $ | 40,492     |        |  | $ | 54,900 |  |  |  | 39 | %






|    |                                                                                                                                                                                                                                                                                                                         
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | The Placed in Service Date represents the date the certificate
    of occupancy was obtained. Subsequent to obtaining the
    certificate of occupancy, the property is expected to undergo a
    lease-up period.                                                                                                      
|   
|(b) | The Total Estimated Costs represent 100% of the
    developments estimated costs, including the acquisition
    cost of the land and building, if any. The Total Estimated Costs
    are subject to change upon, or prior to, the completion of the
    development and include amounts required to lease the property.



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| |          
| | ---------
| | Inflation





| |           
| | ----------
| | Cash Flows



|                                                         |                                                      |                                  |         |           |      |   |        |            |   |   |        |            |  
|-------------------------------------------------------- | ---------------------------------------------------- | -------------------------------- | ------- | --------- | ---- | - | ------ | ---------- | - | - | ------ | ---------- | -
|                                                         |                                                      | For the years ended December 31, |        
|                                                         |                                                      |                                  |        
|                                                         |                                                      | 2004                             |         |           | 2003 |   |        | 2002       |  
|                                                         |                                                      |                                  |         |           |      |   |        |            |  
|                                                         |                                                      | (Dollars in thousands)           |        
|Cash and cash equivalents at the beginning of the period |                                                      | $                                | 69,398  |           |      | $ | 58,471 |            |   | $ | 61,121 |           
|                                                         | Net cash provided by operating activities            |                                  |         | 1,207,967 |      |   |        | 1,219,571  |   |   |        | 1,520,702  |  
|                                                         | Net cash (used for) provided by investing activities |                                  |         | (702,153  | )    |   |        | 628,041    |   |   |        | (41,683    | )
|                                                         | Net cash (used for) financing activities             |                                  |         | (468,086  | )    |   |        | (1,836,685 | ) |   |        | (1,481,669 | )
|                                                         |                                                      |                                  |         |           |      |   |        |            |  
|Cash and cash equivalents at the end of the period       |                                                      | $                                | 107,126 |           |      | $ | 69,398 |            |   | $ | 58,471 |           
|                                                         |                                                      |                                  |         |           |      |   |        |            |  



| |                     
| | --------------------
| | Operating Activities





| |                     
| | --------------------
| | Investing Activities





| |                     
| | --------------------
| | Financing Activities



Additional Items for 2004




| |                        
| | -----------------------
| | Developments in Process



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| |                                                                             
| | ----------------------------------------------------------------------------
| | Investment in Real Estate Held for Sale, Net of Accumulated
    Depreciation





| |                         
| | ------------------------
| | Deferred Rent Receivable





| |                                    
| | -----------------------------------
| | Escrow Deposits and Restricted Cash





| |                                             
| | --------------------------------------------
| | Investments in Unconsolidated Joint Ventures





| |                                                     
| | ----------------------------------------------------
| | Deferred Leasing Costs and Other Related Intangibles





| |                                  
| | ---------------------------------
| | Prepaid Expenses and Other Assets



Other
Liabilities




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Preferred
Shares




Critical Accounting Policies and Estimates




Allowance for Doubtful Accounts






|                                                                |  |                                  |           |   |      |   |           |      |  |   |           |  
|--------------------------------------------------------------- |  | -------------------------------- | --------- | - | ---- | - | --------- | ---- |  | - | --------- | -
|                                                                |  | For the years ended December 31, |          
|                                                                |  |                                  |          
|                                                                |  | 2004                             |           |   | 2003 |   |           | 2002 | 
|                                                                |  |                                  |           |   |      |   |           |      | 
|                                                                |  | (Dollars in thousands)           |          
|Bad debt expense                                                |  | $                                | 5,264     |   |      | $ | 12,400    |      |  | $ | 27,066    |  
|Property operating revenues                                     |  | $                                | 3,195,851 |   |      | $ | 3,137,151 |      |  | $ | 3,293,568 |  
|Bad debt expense as a percentage of property operating revenues |  |                                  | 0.16      | % |      |   | 0.40      | %    |  |   | 0.82      | %



| |                                
| | -------------------------------
| | Impairment of Long-Lived Assets

Accounting for the Impairment and Disposal of
Long-Lived Assets




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| |                              
| | -----------------------------
| | Depreciation and Amortization

Business Combinations




| |                                    
| | -----------------------------------
| | Fair Value of Financial Instruments







Impact of New Accounting Standards and Accounting Standards
Recently Adopted




| |                                   
| | ----------------------------------
| | Accounting Policy Recently Adopted

Accounting for
Stock Based Compensation




47



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| |                  
| | -----------------
| | Subsequent Events



Funds From Operations (FFO)




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Reconciliation of Net Income to Funds From Operations


|                                                                                                                                                                                                                                                                    |  |                                                  |         |              |                  |   |       |         |              |   |                  |   |  |              |       |   |                  |   |              |         |  |   |                  |              |  |         |           |   |                  |   |       |   |  |   |         |   |  |   |       |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------ | ------- | ------------ | ---------------- | - | ----- | ------- | ------------ | - | ---------------- | - |  | ------------ | ----- | - | ---------------- | - | ------------ | ------- |  | - | ---------------- | ------------ |  | ------- | --------- | - | ---------------- | - | ----- | - |  | - | ------- | - |  | - | ----- | -
|                                                                                                                                                                                                                                                                    |  | For the years ended December 31,                 |        
|                                                                                                                                                                                                                                                                    |  |                                                  |        
|                                                                                                                                                                                                                                                                    |  | 2004                                             |         |              | 2003             |   |       | 2002    |              |   | 2001             |   |  | 2000         |      
|                                                                                                                                                                                                                                                                    |  |                                                  |         |              |                  |   |       |         |              |   |                  |   |  |              |      
|                                                                                                                                                                                                                                                                    |  |                                                  |         | Per Weighted |                  |   |       |         | Per Weighted |   |                  |   |  | Per Weighted |       |   |                  |   | Per Weighted |         |  |   |                  | Per Weighted | 
|                                                                                                                                                                                                                                                                    |  | Dollars                                          |         |              | Average Share(b) |   |       | Dollars |              |   | Average Share(b) |   |  | Dollars      |       |   | Average Share(b) |   |              | Dollars |  |   | Average Share(b) |              |  | Dollars |           |   | Average Share(b) |  
|                                                                                                                                                                                                                                                                    |  |                                                  |         |              |                  |   |       |         |              |   |                  |   |  |              |       |   |                  |   |              |         |  |   |                  |              |  |         |           |   |                  |  
|                                                                                                                                                                                                                                                                    |  | (Dollars in thousands, except per share amounts) |        
|Reconciliation of net income to FFO(a):                                                                                                                                                                                                                             |  |                                                  |         |              |                  |   |       |         |              |   |                  |   |  |              |       |   |                  |   |              |         |  |   |                  |              |  |         |           |   |                  |   |       |   |  |   |         |   |  |   |       |  
|                                                                                                                                                                                                                                                                   
|Net income                                                                                                                                                                                                                                                          |  | $                                                | 137,307 |              |                  | $ | 0.34  |         |              | $ | 655,062          |   |  | $            | 1.63  |   |                  | $ | 770,215      |         |  | $ | 1.86             |              |  | $       | 618,182   |   |                  | $ | 1.72  |   |  | $ | 470,860 |   |  | $ | 1.70  |  
|                                                                                                                                                                                                                                                                   
|Plus real estate related depreciation and amortization and less
    net gain (loss) on sales of real estate, including our share of
    those items from unconsolidated joint ventures and adjusted for
    minority interests share in partially owned properties |  |                                                  | 788,029 |              |                  |   | 1.97  |         |              |   | 596,481          |   |  |              | 1.49  |   |                  |   | 707,697      |         |  |   | 1.71             |              |  |         | 532,260   |   |                  |   | 1.48  |   |  |   | 424,845 |   |  |   | 1.53  |  
|                                                                                                                                                                                                                                                                   
|Plus extraordinary item                                                                                                                                                                                                                                             |  |                                                  |        |              |                  |   |      |         |              |   |                 |   |  |              |      |   |                  |   |             |         |  |   |                 |              |  |         | 1,000     |   |                  |   | 0.00  |   |  |   |        |   |  |   |      |  
|                                                                                                                                                                                                                                                                   
|Plus cumulative effect of a change in accounting principle                                                                                                                                                                                                          |  |                                                  | 33,697  |              |                  |   | 0.08  |         |              |   |                 |   |  |              |      |   |                  |   |             |         |  |   |                 |              |  |         | 1,142     |   |                  |   | 0.00  |   |  |   |        |   |  |   |      |  
|                                                                                                                                                                                                                                                                   
|Less minority interests in EOP Partnership share of add back for
    real estate related depreciation and amortization, net gain
    (loss) on sales of real estate, extraordinary item and
    cumulative effect of a change in accounting principle               |  |                                                  | (87,784 | )            |                  |   | (0.22 | )       |              |   | (65,381          | ) |  |              | (0.16 | ) |                  |   | (79,225      | )       |  |   | (0.19            | )            |  |         | (63,527   | ) |                  |   | (0.18 | ) |  |   | (52,086 | ) |  |   | (0.19 | )
|                                                                                                                                                                                                                                                                    |  |                                                  |         |              |                  |   |       |         |              |   |                  |   |  |              |       |   |                  |   |              |         |  |   |                  |              |  |         |           |   |                  |  
|                                                                                                                                                                                                                                                                   
|FFO                                                                                                                                                                                                                                                                 |  |                                                  | 871,249 |              |                  |   | 2.17  |         |              |   | 1,186,162        |   |  |              | 2.96  |   |                  |   | 1,398,687    |         |  |   | 3.37             |              |  |         | 1,089,057 |   |                  |   | 3.02  |   |  |   | 843,619 |   |  |   | 3.04  |  
|                                                                                                                                                                                                                                                                   
|Put option settlement                                                                                                                                                                                                                                               |  |                                                  |        |              |                  |   |      |         |              |   |                 |   |  |              |      |   |                  |   |             |         |  |   |                 |              |  |         | 2,655     |   |                  |   | 0.01  |   |  |   | (2,576  | ) |  |   | (0.01 | )
|                                                                                                                                                                                                                                                                   
|Preferred distributions                                                                                                                                                                                                                                             |  |                                                  | (39,093 | )            |                  |   | (0.10 | )       |              |   | (51,872          | ) |  |              | (0.13 | ) |                  |   | (62,573      | )       |  |   | (0.15            | )            |  |         | (57,041   | ) |                  |   | (0.16 | ) |  |   | (43,348 | ) |  |   | (0.16 | )
|                                                                                                                                                                                                                                                                    |  |                                                  |         |              |                  |   |       |         |              |   |                  |   |  |              |       |   |                  |   |              |         |  |   |                  |              |  |         |           |   |                  |  
|                                                                                                                                                                                                                                                                   
|FFO available to common shareholders  basic                                                                                                                                                                                                                        |  | $                                                | 832,156 |              |                  | $ | 2.08  | (d)     |              | $ | 1,134,290        |   |  | $            | 2.83  |   |                  | $ | 1,336,114    |         |  | $ | 3.22             |              |  | $       | 1,034,671 |   |                  | $ | 2.87  |   |  | $ | 797,695 |   |  | $ | 2.88  |  
|                                                                                                                                                                                                                                                                    |  |                                                  |         |              |                  |   |       |         |              |   |                  |   |  |              |       |   |                  |   |              |         |  |   |                  |              |  |         |           |   |                  |  

|                                                                                                                                                                                                                                                 |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |   |  |   |             |   |  |   |             |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ------------------------------------------ | ----------- | - | --- | - | ----------- | ---------- |  | - | ----------- | - |  | ---------- | ----------- | - | --- | - | ----------- | ---------- |  | - | ----------- | - |  | ---------- | ----------- | - | --- | - | ----------- | - |  | - | ----------- | - |  | - | ----------- | -
|Adjustments to arrive                                                                                                                                                                                                                            |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |           
|at FFO available to                                                                                                                                                                                                                              |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |           
|common shareholders                                                                                                                                                                                                                              |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |           
|plus assumed                                                                                                                                                                                                                                     |  | Net Income                                 |             |   | FFO |   |             | Net Income |  |   | FFO         |   |  | Net Income |             |   | FFO |   |             | Net Income |  |   | FFO         |   |  | Net Income |             |   | FFO |  
|conversions:                                                                                                                                                                                                                                     |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |  
|Net income and FFO                                                                                                                                                                                                                               |  | $                                          | 137,307     |   |     | $ | 871,249     |            |  | $ | 655,062     |   |  | $          | 1,186,162   |   |     | $ | 770,215     |            |  | $ | 1,398,687   |   |  | $          | 618,182     |   |     | $ | 1,089,057   |   |  | $ | 470,860     |   |  | $ | 843,619     |  
|Put option settlement                                                                                                                                                                                                                            |  |                                            |            |   |     |   |            |            |  |   |            |   |  |            |            |   |     |   |            |            |  |   |            |   |  |            | 2,655       |   |     |   | 2,655       |   |  |   | (2,576      | ) |  |   | (2,576      | )
|Preferred distributions                                                                                                                                                                                                                          |  |                                            | (39,093     | ) |     |   | (39,093     | )          |  |   | (51,872     | ) |  |            | (51,872     | ) |     |   | (62,573     | )          |  |   | (62,573     | ) |  |            | (57,041     | ) |     |   | (57,041     | ) |  |   | (43,348     | ) |  |   | (43,348     | )
|                                                                                                                                                                                                                                                 |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |  
|Net income and FFO available to common shareholders                                                                                                                                                                                              |  |                                            | 98,214      |   |     |   | 832,156     |            |  |   | 603,190     |   |  |            | 1,134,290   |   |     |   | 707,642     |            |  |   | 1,336,114   |   |  |            | 563,796     |   |     |   | 1,034,671   |   |  |   | 424,936     |   |  |   | 797,695     |  
|Net income allocated to minority interests in EOP Partnership                                                                                                                                                                                    |  |                                            | 11,747      |   |     |   | 11,747      |            |  |   | 74,152      |   |  |            | 74,152      |   |     |   | 89,205      |            |  |   | 89,205      |   |  |            | 76,249      |   |     |   | 76,249      |   |  |   | 59,376      |   |  |   | 59,376      |  
|Minority interests in EOP Partnership share of add back for real
    estate related depreciation and amortization, net gain (loss) on
    sales of real estate, extraordinary item and cumulative effect
    of a change in accounting principle |  |                                            |            |   |     |   | 87,784      |            |  |   |            |   |  |            | 65,381      |   |     |   |            |            |  |   | 79,225      |   |  |            |            |   |     |   | 63,527      |   |  |   |            |   |  |   | 52,086      |  
|Preferred distributions on Series B preferred shares, of
    which are assumed to be converted into Common Shares(c)                                                                                                                             |  |                                            |            |   |     |   |            |            |  |   |            |   |  |            | 15,724      |   |     |   |            |            |  |   | 15,724      |   |  |            |            |   |     |   | 15,727      |   |  |   |            |   |  |   | 15,750      |  
|                                                                                                                                                                                                                                                 |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |  
|Net income and FFO available to common shareholders plus assumed
    conversions                                                                                                                                                                 |  | $                                          | 109,961     |   |     | $ | 931,687     |            |  | $ | 677,342     |   |  | $          | 1,289,547   |   |     | $ | 796,847     |            |  | $ | 1,520,268   |   |  | $          | 640,045     |   |     | $ | 1,190,174   |   |  | $ | 484,312     |   |  | $ | 924,907     |  
|                                                                                                                                                                                                                                                 |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |  
|Weighted average Common Shares, dilutive potential common shares
    plus assumed conversions outstanding                                                                                                                                        |  |                                            | 450,997,247 |   |     |   | 450,997,247 |            |  |   | 452,561,353 |   |  |            | 460,950,707 |   |     |   | 469,138,720 |            |  |   | 477,528,074 |   |  |            | 411,986,897 |   |     |   | 420,379,753 |   |  |   | 318,997,407 |   |  |   | 327,400,767 |  
|                                                                                                                                                                                                                                                 |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |  
|Net income and FFO available to common shareholders plus assumed
    conversions per share                                                                                                                                                       |  | $                                          | 0.24        |   |     | $ | 2.07        | (d)        |  | $ | 1.50        |   |  | $          | 2.80        |   |     | $ | 1.70        |            |  | $ | 3.18        |   |  | $          | 1.55        |   |     | $ | 2.83        |   |  | $ | 1.52        |   |  | $ | 2.82        |  
|                                                                                                                                                                                                                                                 |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |  
|                                                                                                                                                                                                                                                 |  | Common Shares and common share equivalents
|                                                                                                                                                                                                                                                 |  |                                           
|Weighted average Common Shares outstanding (used for both net
    income and FFO basic per share calculation)                                                                                                                                    |  |                                            |             |   |     |   | 400,755,733 |            |  |   |             |   |  |            | 401,016,093 |   |     |   |             |            |  |   | 414,689,029 |   |  |            |             |   |     |   | 360,026,097 |   |  |   |             |   |  |   | 277,186,733 |  
|Redemption of Units for Common Shares                                                                                                                                                                                                            |  |                                            |             |   |     |   | 48,163,569  |            |  |   |             |   |  |            | 49,578,372  |   |     |   |             |            |  |   | 52,445,745  |   |  |            |             |   |     |   | 48,893,485  |   |  |   |             |   |  |   | 38,880,961  |  
|Impact of share options, restricted shares and put options which
    are dilutive to both net income and FFO                                                                                                                                     |  |                                            |             |   |     |   | 2,077,945   |            |  |   |             |   |  |            | 1,966,888   |   |     |   |             |            |  |   | 2,003,946   |   |  |            |             |   |     |   | 3,067,315   |   |  |   |             |   |  |   | 2,929,713   |  
|                                                                                                                                                                                                                                                 |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |  
|Weighted average Common Shares and dilutive potential common
    shares used for net income available to common shareholders                                                                                                                     |  |                                            |             |   |     |   | 450,997,247 |            |  |   |             |   |  |            | 452,561,353 |   |     |   |             |            |  |   | 469,138,720 |   |  |            |             |   |     |   | 411,986,897 |   |  |   |             |   |  |   | 318,997,407 |  
|Impact of conversion of Series B preferred shares(c)                                                                                                                                                                                             |  |                                            |             |   |     |   |            |            |  |   |             |   |  |            | 8,389,354   |   |     |   |             |            |  |   | 8,389,354   |   |  |            |             |   |     |   | 8,392,856   |   |  |   |             |   |  |   | 8,403,360   |  
|                                                                                                                                                                                                                                                 |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |  
|Weighted average Common Shares, dilutive potential common shares
    plus assumed conversions used for the calculation of FFO
    available to common shareholders plus assumed conversions                                                      |  |                                            |             |   |     |   | 450,997,247 |            |  |   |             |   |  |            | 460,950,707 |   |     |   |             |            |  |   | 477,528,074 |   |  |            |             |   |     |   | 420,379,753 |   |  |   |             |   |  |   | 327,400,767 |  
|                                                                                                                                                                                                                                                 |  |                                            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |   |             |            |  |   |             |   |  |            |             |   |     |  






|    |                                                                                                                                                       
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | FFO is a non-GAAP financial measure. The most directly
    comparable GAAP measure is net income, to which it is
    reconciled. See definition below.



|    |                                                                                                           
|--- | ----------------------------------------------------------------------------------------------------------
|(b) | FFO per share may not total the sum of the per share components
    in the reconciliation due to rounding.



|    |                                                                                                                                                                                                                                          
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(c) | The Series B preferred shares are not dilutive to EPS for
    each period presented and are not dilutive to FFO per share for
    the year ended December 31, 2004 but are dilutive to FFO
    per share for all other periods presented.



|    |                                                                                                                                                                                                                                                                                            
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(d) | FFO per share for the year ended December 31, 2004 includes
    a $229.2 million non-cash impairment charge, or
    $.51 per share on a diluted basis, recorded in the third
    quarter 2004. By definition, impairment charges are not added
    back to net income when calculating FFO.

49



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FFO Definition:







Item 7A.     Quantitative and
Qualitative Disclosures About Market Risk.




50



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|        |                                             
|------- | --------------------------------------------
|Item 8. | Financial Statements and Supplementary Data.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
















| |                  
| | -----------------
| | Ernst & Young LLP





51



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


















| |                  
| | -----------------
| | Ernst & Young LLP





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EQUITY OFFICE PROPERTIES TRUST


CONSOLIDATED BALANCE SHEETS


|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |            |   |            |            |            |  
|------------------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------- | ---------- | ---------- | - | ---------- | ---------- | ---------- | -
|                                                                                                       |                                                                                                                                   | December 31,                                                                                                                                          |                                                                                                                                                              
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                              
|                                                                                                       |                                                                                                                                   | 2004                                                                                                                                                  |                                                                                                                                                               |            | 2003       |           
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |           
|                                                                                                       |                                                                                                                                   | (Dollars in thousands,                                                                                                                                |                                                                                                                                                              
|                                                                                                       |                                                                                                                                   | except per share amounts)                                                                                                                             |                                                                                                                                                              
|Assets:                                                                                                |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |            |   |           
|                                                                                                       | Investments in real estate                                                                                                        |                                                                                                                                                       | $                                                                                                                                                             | 24,970,416 |            |            | $ | 23,934,848 |           
|                                                                                                       | Developments in process                                                                                                           |                                                                                                                                                       |                                                                                                                                                               | 40,492     |            |            |   | 75,232     |           
|                                                                                                       | Land available for development                                                                                                    |                                                                                                                                                       |                                                                                                                                                               | 252,524    |            |            |   | 251,151    |           
|                                                                                                       | Investments in real estate held for sale, net of accumulated
    depreciation                                                     |                                                                                                                                                       |                                                                                                                                                               | 41,255     |            |            |   | 43,911     |           
|                                                                                                       | Accumulated depreciation                                                                                                          |                                                                                                                                                       |                                                                                                                                                               | (3,164,511 | )          |            |   | (2,571,002 | )         
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |           
|                                                                                                       |                                                                                                                                   | Investments in real estate, net of accumulated depreciation                                                                                           |                                                                                                                                                               |            | 22,140,176 |            |   |            | 21,734,140 |           
|                                                                                                       | Cash and cash equivalents                                                                                                         |                                                                                                                                                       |                                                                                                                                                               | 107,126    |            |            |   | 69,398     |           
|                                                                                                       | Tenant and other receivables (net of allowance for doubtful
    accounts of $6,908 and $6,490, respectively)                      |                                                                                                                                                       |                                                                                                                                                               | 75,775     |            |            |   | 79,880     |           
|                                                                                                       | Deferred rent receivable                                                                                                          |                                                                                                                                                       |                                                                                                                                                               | 478,184    |            |            |   | 379,329    |           
|                                                                                                       | Escrow deposits and restricted cash                                                                                               |                                                                                                                                                       |                                                                                                                                                               | 48,784     |            |            |   | 75,186     |           
|                                                                                                       | Investments in unconsolidated joint ventures                                                                                      |                                                                                                                                                       |                                                                                                                                                               | 1,117,143  |            |            |   | 1,127,232  |           
|                                                                                                       | Deferred financing costs (net of accumulated amortization of
    $59,748 and $48,176, respectively)                               |                                                                                                                                                       |                                                                                                                                                               | 61,734     |            |            |   | 64,337     |           
|                                                                                                       | Deferred leasing costs and other related intangibles (net of
    accumulated amortization of $193,348 and $157,445, respectively) |                                                                                                                                                       |                                                                                                                                                               | 450,625    |            |            |   | 314,568    |           
|                                                                                                       | Prepaid expenses and other assets (net of discounts of $2,304
    and $66,200, respectively)                                      |                                                                                                                                                       |                                                                                                                                                               | 191,992    |            |            |   | 344,940    |           
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |           
|                                                                                                       |                                                                                                                                   | Total Assets                                                                                                                                          |                                                                                                                                                               | $          | 24,671,539 |            |   | $          | 24,189,010 |           
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |           
|                                                                                                      
|Liabilities, Minority Interests, Mandatorily Redeemable
    Preferred Shares and Shareholders Equity: |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |            |   |           
|Liabilities:                                                                                           |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |            |   |           
|                                                                                                       | Mortgage debt (net of (discounts) of $(13,683) and
    $(13,663), respectively)                                                   |                                                                                                                                                       | $                                                                                                                                                             | 2,609,067  |            |            | $ | 2,315,889  |           
|                                                                                                       | Unsecured notes (net of (discounts) premiums of $(38,362)
    and $12,412, respectively)                                          |                                                                                                                                                       |                                                                                                                                                               | 9,652,392  |            |            |   | 8,828,912  |           
|                                                                                                       | Lines of credit                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               | 548,000    |            |            |   | 334,000    |           
|                                                                                                       | Accounts payable and accrued expenses                                                                                             |                                                                                                                                                       |                                                                                                                                                               | 556,851    |            |            |   | 573,069    |           
|                                                                                                       | Distribution payable                                                                                                              |                                                                                                                                                       |                                                                                                                                                               | 2,652      |            |            |   | 3,899      |           
|                                                                                                       | Other liabilities (net of (discounts) of $(28,536) and $0,
    respectively)                                                      |                                                                                                                                                       |                                                                                                                                                               | 484,378    |            |            |   | 398,273    |           
|                                                                                                       | Commitments and contingencies                                                                                                     |                                                                                                                                                       |                                                                                                                                                               |           |            |            |   |           |           
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |           
|                                                                                                       |                                                                                                                                   | Total Liabilities                                                                                                                                     |                                                                                                                                                               |            | 13,853,340 |            |   |            | 12,454,042 |           
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |           
|                                                                                                       | Minority Interests:                                                                                                               |                                                                                                                                                       |                                                                                                                                                               |            |            |            |   |            |           
|                                                                                                       |                                                                                                                                   | EOP Partnership                                                                                                                                       |                                                                                                                                                               |            | 1,065,376  |            |   |            | 1,191,741  |           
|                                                                                                       |                                                                                                                                   | Partially owned properties                                                                                                                            |                                                                                                                                                               |            | 182,041    |            |   |            | 183,863    |           
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |           
|                                                                                                       |                                                                                                                                   | Total Minority Interests                                                                                                                              |                                                                                                                                                               |            | 1,247,417  |            |   |            | 1,375,604  |           
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |           
|                                                                                                       | Mandatorily Redeemable Preferred Shares:                                                                                          |                                                                                                                                                       |                                                                                                                                                               |            |            |            |   |            |           
|                                                                                                       |                                                                                                                                   | 5.25% Series B Convertible, Cumulative Redeemable Preferred
    Shares, liquidation preference $50.00 per share, 5,990,000
    issued and outstanding |                                                                                                                                                               |            | 299,500    |            |   |            | 299,500    |           
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |           
|                                                                                                       | Shareholders Equity:                                                                                                             |                                                                                                                                                       |                                                                                                                                                               |            |            |            |   |            |           
|                                                                                                       |                                                                                                                                   | Preferred Shares, 100,000,000 authorized:                                                                                                             |                                                                                                                                                               |            |            |            |   |            |            |           
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       | 8.625% Series C Cumulative Redeemable Preferred Shares,
    liquidation preference $25.00 per share, 0 and 4,562,900
    issued and outstanding, respectively |            |            |           |   |            |            | 114,073    |  
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       | 7.75% Series G Cumulative Redeemable Preferred Shares,
    liquidation preference $25.00 per share, 8,500,000 issued
    and outstanding                      |            |            | 212,500    |   |            |            | 212,500    |  
|                                                                                                       |                                                                                                                                   | Common Shares, $0.01 par value; 750,000,000 shares
    authorized, 403,842,441 and 400,460,388 issued and outstanding,
    respectively               |                                                                                                                                                               |            | 4,038      |            |   |            | 4,005      |           
|                                                                                                       |                                                                                                                                   | Other Shareholders Equity:                                                                                                                           |                                                                                                                                                               |            |            |            |   |            |            |           
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       | Additional paid in capital                                                                                                                                    |            |            | 10,479,305 |   |            |            | 10,396,864 |  
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       | Deferred compensation                                                                                                                                         |            |            | (1,916     | ) |            |            | (5,889     | )
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       | Dividends in excess of accumulated earnings                                                                                                                   |            |            | (1,359,722 | ) |            |            | (652,036   | )
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       | Accumulated other comprehensive loss (net of accumulated
    amortization of $5,133 and ($73), respectively)                                                  |            |            | (62,923    | ) |            |            | (9,653     | )
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |           
|                                                                                                       |                                                                                                                                   | Total Shareholders Equity                                                                                                                            |                                                                                                                                                               |            | 9,271,282  |            |   |            | 10,059,864 |           
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |           
|                                                                                                       |                                                                                                                                   | Total Liabilities, Minority Interests, Mandatorily Redeemable
    Preferred Shares and Shareholders Equity                                           |                                                                                                                                                               | $          | 24,671,539 |            |   | $          | 24,189,010 |           
|                                                                                                       |                                                                                                                                   |                                                                                                                                                       |                                                                                                                                                               |            |            |           



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EQUITY OFFICE PROPERTIES TRUST


CONSOLIDATED STATEMENTS OF OPERATIONS


|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |          |           |         |             |          |           |  
|--------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------- | ---------------------------------------------------------------- | ---------------------------- | ----------- | -------- | --------- | ------- | ----------- | -------- | --------- | ------- | ----------- | -------- | --------- | -
|                                                                                                                                                                |                                                                                     | For the years ended December 31,                                 |                             
|                                                                                                                                                                |                                                                                     |                                                                  |                             
|                                                                                                                                                                |                                                                                     | 2004                                                             |                              |             | 2003     |           |         | 2002        |         
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|                                                                                                                                                                |                                                                                     | (Dollars in thousands, except per share amounts)                 |                             
|Revenues:                                                                                                                                                       |                                                                                     |                                                                  |                              |             |          |           |         |             |          |           |         |            
|                                                                                                                                                                | Rental                                                                              |                                                                  | $                            | 2,554,471   |          |           | $       | 2,490,291   |          |           | $       | 2,565,132   |         
|                                                                                                                                                                | Tenant reimbursements                                                               |                                                                  |                              | 432,733     |          |           |         | 431,516     |          |           |         | 470,966     |         
|                                                                                                                                                                | Parking                                                                             |                                                                  |                              | 117,448     |          |           |         | 111,160     |          |           |         | 112,897     |         
|                                                                                                                                                                | Other                                                                               |                                                                  |                              | 76,973      |          |           |         | 88,323      |          |           |         | 128,666     |         
|                                                                                                                                                                | Fee income                                                                          |                                                                  |                              | 14,226      |          |           |         | 15,861      |          |           |         | 15,907      |         
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|                                                                                                                                                                |                                                                                     |                                                                  | Total revenues               |             |          | 3,195,851 |         |             |          | 3,137,151 |         |             |          | 3,293,568 |  
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|Expenses:                                                                                                                                                       |                                                                                     |                                                                  |                              |             |          |           |         |             |          |           |         |            
|                                                                                                                                                                | Depreciation                                                                        |                                                                  |                              | 701,216     |          |           |         | 637,441     |          |           |         | 598,744     |         
|                                                                                                                                                                | Amortization                                                                        |                                                                  |                              | 82,469      |          |           |         | 64,473      |          |           |         | 51,441      |         
|                                                                                                                                                                | Real estate taxes                                                                   |                                                                  |                              | 367,610     |          |           |         | 344,625     |          |           |         | 353,090     |         
|                                                                                                                                                                | Insurance                                                                           |                                                                  |                              | 37,938      |          |           |         | 27,877      |          |           |         | 38,014      |         
|                                                                                                                                                                | Repairs and maintenance                                                             |                                                                  |                              | 350,059     |          |           |         | 332,140     |          |           |         | 336,439     |         
|                                                                                                                                                                | Property operating                                                                  |                                                                  |                              | 428,891     |          |           |         | 405,996     |          |           |         | 405,844     |         
|                                                                                                                                                                | Ground rent                                                                         |                                                                  |                              | 25,467      |          |           |         | 20,287      |          |           |         | 20,325      |         
|                                                                                                                                                                | Corporate general and administrative                                                |                                                                  |                              | 52,242      |          |           |         | 62,479      |          |           |         | 65,790      |         
|                                                                                                                                                                | Impairment                                                                          |                                                                  |                              | 228,272     |          |           |         | 7,500       |          |           |         |            |         
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|                                                                                                                                                                |                                                                                     |                                                                  | Total expenses               |             |          | 2,274,164 |         |             |          | 1,902,818 |         |             |          | 1,869,687 |  
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|                                                                                                                                                                |                                                                                     |                                                                  | Operating income             |             |          | 921,687   |         |             |          | 1,234,333 |         |             |          | 1,423,881 |  
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|Other income (expense):                                                                                                                                         |                                                                                     |                                                                  |                              |             |          |           |         |             |          |           |         |            
|                                                                                                                                                                | Interest and dividend income                                                        |                                                                  |                              | 8,302       |          |           |         | 12,580      |          |           |         | 22,148      |         
|                                                                                                                                                                | Realized gain on settlement of derivatives and sale of
    marketable securities    |                                                                  |                              | 28,976      |          |           |         | 9,286       |          |           |         |            |         
|                                                                                                                                                                | Interest:                                                                           |                                                                  |                              |             |          |           |         |             |          |           |         |             |         
|                                                                                                                                                                |                                                                                     | Expense incurred                                                 |                              |             | (835,385 | )         |         |             | (819,730 | )         |         |             | (809,033 | )        
|                                                                                                                                                                |                                                                                     | Amortization of deferred financing costs and prepayment expenses |                              |             | (15,337  | )         |         |             | (6,976   | )         |         |             | (4,964   | )        
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|                                                                                                                                                                |                                                                                     |                                                                  | Total other income (expense) |             |          | (813,444  | )       |             |          | (804,840  | )       |             |          | (791,849  | )
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|Income before income taxes, allocation to minority interests,
    income from investments in unconsolidated joint ventures and
    gain on sales of real estate |                                                                                     |                                                                  | 108,243                      |             |          |           | 429,493 |             |          |           | 632,032 |            
|Income taxes                                                                                                                                                    |                                                                                     |                                                                  | (2,012                       | )           |          |           | (5,388  | )           |          |           | (9,101  | )          
|Minority Interests:                                                                                                                                             |                                                                                     |                                                                  |                              |             |          |           |         |             |          |           |         |            
|                                                                                                                                                                | EOP Partnership                                                                     |                                                                  |                              | (11,747     | )        |           |         | (74,152     | )        |           |         | (89,205     | )       
|                                                                                                                                                                | Partially owned properties                                                          |                                                                  |                              | (10,973     | )        |           |         | (8,080      | )        |           |         | (7,120      | )       
|Income from investments in unconsolidated joint ventures                                                                                                        |                                                                                     |                                                                  | 50,304                       |             |          |           | 79,882  |             |          |           | 106,852 |            
|Gain on sales of real estate                                                                                                                                    |                                                                                     |                                                                  | 21,901                       |             |          |           | 99,110  |             |          |           |        |            
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|Income from continuing operations                                                                                                                               |                                                                                     |                                                                  | 155,716                      |             |          |           | 520,865 |             |          |           | 633,458 |            
|Discontinued operations (including net gain on sales of real
    estate and property held for sale of $5,473, $61,953, and
    $17,926, respectively)           |                                                                                     |                                                                  | 15,288                       |             |          |           | 134,197 |             |          |           | 136,757 |            
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|Income before cumulative effect of a change in accounting
    principle                                                                                         |                                                                                     |                                                                  | 171,004                      |             |          |           | 655,062 |             |          |           | 770,215 |            
|Cumulative effect of a change in accounting principle                                                                                                           |                                                                                     |                                                                  | (33,697                      | )           |          |           |        |             |          |           |        |            
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|Net income                                                                                                                                                      |                                                                                     |                                                                  | 137,307                      |             |          |           | 655,062 |             |          |           | 770,215 |            
|Preferred distributions                                                                                                                                         |                                                                                     |                                                                  | (39,093                      | )           |          |           | (51,872 | )           |          |           | (62,573 | )          
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|Net income available to common shareholders                                                                                                                     |                                                                                     | $                                                                | 98,214                       |             |          | $         | 603,190 |             |          | $         | 707,642 |            
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|Earnings per share  basic:                                                                                                                                     |                                                                                     |                                                                  |                              |             |          |           |         |             |          |           |         |            
|                                                                                                                                                                | Income from continuing operations per share                                         |                                                                  | $                            | 0.29        |          |           | $       | 1.21        |          |           | $       | 1.41        |         
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|                                                                                                                                                                | Net income available to common shareholders per share                               |                                                                  | $                            | 0.25        |          |           | $       | 1.50        |          |           | $       | 1.71        |         
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|                                                                                                                                                                | Weighted average Common Shares outstanding                                          |                                                                  |                              | 400,755,733 |          |           |         | 401,016,093 |          |           |         | 414,689,029 |         
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|Earnings per share  diluted:                                                                                                                                   |                                                                                     |                                                                  |                              |             |          |           |         |             |          |           |         |            
|                                                                                                                                                                | Income from continuing operations per share                                         |                                                                  | $                            | 0.28        |          |           | $       | 1.20        |          |           | $       | 1.41        |         
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|                                                                                                                                                                | Net income available to common shareholders per share                               |                                                                  | $                            | 0.24        |          |           | $       | 1.50        |          |           | $       | 1.70        |         
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|                                                                                                                                                                | Weighted average Common Shares outstanding and dilutive
    potential common shares |                                                                  |                              | 450,997,247 |          |           |         | 452,561,353 |          |           |         | 469,138,720 |         
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         
|Distributions declared per Common Share outstanding                                                                                                             |                                                                                     | $                                                                | 2.00                         |             |          | $         | 2.00    |             |          | $         | 2.00    |            
|                                                                                                                                                                |                                                                                     |                                                                  |                              |             |          |           |         |             |         



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##### Table of Contents



EQUITY OFFICE PROPERTIES TRUST


CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS
EQUITY


|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |   |   |            |          |  
|-------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------- | ---------- | -------- | ---- | - | ---------- | -------- | - | - | ---------- | -------- | -
|                                             |                                                                                                                                                                 | For the years ended December 31, |           
|                                             |                                                                                                                                                                 |                                  |           
|                                             |                                                                                                                                                                 | 2004                             |            |          | 2003 |   |            | 2002     |  
|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |  
|                                             |                                                                                                                                                                 | (Dollars in thousands)           |           
|Mandatorily Redeemable Preferred Shares      |                                                                                                                                                                 | $                                | 299,500    |          |      | $ | 299,500    |          |   | $ | 299,500    |         
|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |  
|Preferred Shares:                            |                                                                                                                                                                 |                                  |            |          |      |   |            |          |   |   |            |         
|Balance, beginning of period                 |                                                                                                                                                                 | $                                | 326,573    |          |      | $ | 576,573    |          |   | $ | 563,923    |         
|                                             | Issuance of 7.75% Series G Cumulative Redeemable Preferred
    Shares                                                                                           |                                  |            |         |      |   |            |         |   |   |            | 212,500  |  
|                                             | Redemptions                                                                                                                                                     |                                  |            | (114,073 | )    |   |            | (250,000 | ) |   |            | (199,850 | )
|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |  
|Balance, end of period                       |                                                                                                                                                                 | $                                | 212,500    |          |      | $ | 326,573    |          |   | $ | 576,573    |         
|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |  
|Common Shares, $0.01 par Value Per Share:    |                                                                                                                                                                 |                                  |            |          |      |   |            |          |   |   |            |         
|Balance, beginning of period                 |                                                                                                                                                                 | $                                | 4,005      |          |      | $ | 4,112      |          |   | $ | 4,145      |         
|                                             | Issuance of Common Shares through exercise of share options                                                                                                     |                                  |            | 24       |      |   |            | 16       |   |   |            | 17       |  
|                                             | Issuance of Common Shares in exchange for Units                                                                                                                 |                                  |            | 14       |      |   |            | 10       |   |   |            | 26       |  
|                                             | Common Shares issued for restricted shares, trustee fees and for
    the dividend reinvestment plan, net of restricted shares
    retired, net of cancellations |                                  |            | 9        |      |   |            | 9        |   |   |            | 3        |  
|                                             | Common Shares repurchased                                                                                                                                       |                                  |            | (14      | )    |   |            | (142     | ) |   |            | (79      | )
|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |  
|Balance, end of period                       |                                                                                                                                                                 | $                                | 4,038      |          |      | $ | 4,005      |          |   | $ | 4,112      |         
|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |  
|Additional Paid in Capital:                  |                                                                                                                                                                 |                                  |            |          |      |   |            |          |   |   |            |         
|Balance, beginning of period                 |                                                                                                                                                                 | $                                | 10,396,864 |          |      | $ | 10,691,610 |          |   | $ | 10,788,273 |         
|                                             | Issuance of Common Shares through exercise of share options                                                                                                     |                                  |            | 59,245   |      |   |            | 37,728   |   |   |            | 39,998   |  
|                                             | Issuance of Common Shares in exchange for Units                                                                                                                 |                                  |            | 37,491   |      |   |            | 23,855   |   |   |            | 62,163   |  
|                                             | Common Shares issued for restricted shares, trustee fees and for
    the dividend reinvestment plan, net of restricted shares
    retired, net of cancellations |                                  |            | 2,473    |      |   |            | (9       | ) |   |            | 11,869   |  
|                                             | Offering costs                                                                                                                                                  |                                  |            | (84      | )    |   |            | (257     | ) |   |            | (7,042   | )
|                                             | Amortization of offering costs                                                                                                                                  |                                  |            | 6,737    |      |   |            |         |   |   |            |         |  
|                                             | Common Shares repurchased                                                                                                                                       |                                  |            | (37,760  | )    |   |            | (363,344 | ) |   |            | (196,803 | )
|                                             | Compensation expense related to restricted shares and stock
    options issued to employees                                                                     |                                  |            | 13,992   |      |   |            | 7,500    |   |   |            |         |  
|                                             | Adjustment for minority interests ownership in EOP Partnership                                                                                                  |                                  |            | 347      |      |   |            | (219     | ) |   |            | (6,848   | )
|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |  
|Balance, end of period                       |                                                                                                                                                                 | $                                | 10,479,305 |          |      | $ | 10,396,864 |          |   | $ | 10,691,610 |         
|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |  
|Deferred Compensation:                       |                                                                                                                                                                 |                                  |            |          |      |   |            |          |   |   |            |         
|Balance, beginning of period                 |                                                                                                                                                                 | $                                | (5,889     | )        |      | $ | (15,472    | )        |   | $ | (19,822    | )       
|                                             | Restricted shares granted                                                                                                                                       |                                  |            |         |      |   |            |         |   |   |            | (17,060  | )
|                                             | Restricted shares retired                                                                                                                                       |                                  |            |         |      |   |            |         |   |   |            | 7,669    |  
|                                             | Amortization of restricted shares                                                                                                                               |                                  |            | 3,973    |      |   |            | 9,583    |   |   |            | 13,741   |  
|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |  
|Balance, end of period                       |                                                                                                                                                                 | $                                | (1,916     | )        |      | $ | (5,889     | )        |   | $ | (15,472    | )       
|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |  
|Dividends in Excess of Accumulated Earnings: |                                                                                                                                                                 |                                  |            |          |      |   |            |          |   |   |            |         
|Balance, beginning of period                 |                                                                                                                                                                 | $                                | (652,036   | )        |      | $ | (452,636   | )        |   | $ | (327,537   | )       
|                                             | Net income                                                                                                                                                      |                                  |            | 137,307  |      |   |            | 655,062  |   |   |            | 770,215  |  
|                                             | Preferred distributions                                                                                                                                         |                                  |            | (39,093  | )    |   |            | (51,872  | ) |   |            | (62,573  | )
|                                             | Distributions to common shareholders                                                                                                                            |                                  |            | (805,900 | )    |   |            | (802,590 | ) |   |            | (832,741 | )
|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |  
|Balance, end of period                       |                                                                                                                                                                 | $                                | (1,359,722 | )        |      | $ | (652,036   | )        |   | $ | (452,636   | )       
|                                             |                                                                                                                                                                 |                                  |            |          |      |   |            |          |  



55



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##### Table of Contents



EQUITY OFFICE PROPERTIES TRUST


CONSOLIDATED STATEMENTS OF NET COMPREHENSIVE INCOME


|                                   |                                                                                                      |                                  |         |         |      |   |         |        |   |   |         |         |  
|---------------------------------- | ---------------------------------------------------------------------------------------------------- | -------------------------------- | ------- | ------- | ---- | - | ------- | ------ | - | - | ------- | ------- | -
|                                   |                                                                                                      | For the years ended December 31, |        
|                                   |                                                                                                      |                                  |        
|                                   |                                                                                                      | 2004                             |         |         | 2003 |   |         | 2002   |  
|                                   |                                                                                                      |                                  |         |         |      |   |         |        |  
|                                   |                                                                                                      | (Dollars in thousands)           |        
|Net income                         |                                                                                                      | $                                | 137,307 |         |      | $ | 655,062 |        |   | $ | 770,215 |        
|Other comprehensive (loss) income: |                                                                                                      |                                  |         |         |      |   |         |        |   |   |         |        
|                                   | Unrealized holding (losses) gains on forward starting interest
    rate swaps                        |                                  |         | (34,665 | )    |   |         | 8,930  |   |   |         | (18,611 | )
|                                   | Reversal of unrealized holding loss (gain) on settlement of
    forward starting interest rate swaps |                                  |         | 45,115  |      |   |         | (768   | ) |   |         |        |  
|                                   | (Payments) proceeds from settlement of forward starting interest
    rate swaps                      |                                  |         | (69,130 | )    |   |         | 768    |   |   |         |        |  
|                                   | Reclassification of ineffective portion of swap settlement
    payment to net income                 |                                  |         | 212     |      |   |         |       |   |   |         |        |  
|                                   | Amortization of payments (proceeds) from settlement of
    forward starting interest rate swaps      |                                  |         | 5,206   |      |   |         | (73    | ) |   |         |        |  
|                                   | Unrealized holding gains from investments arising during the year                                    |                                  |         | 23      |      |   |         | 848    |   |   |         | 396     |  
|                                   | Reclassification adjustment for realized (gains) losses
    included in net income                   |                                  |         | (31     | )    |   |         | (1,142 | ) |   |         | 116     |  
|                                   |                                                                                                      |                                  |         |         |      |   |         |        |  
|Net comprehensive income           |                                                                                                      | $                                | 84,037  |         |      | $ | 663,625 |        |   | $ | 752,116 |        
|                                   |                                                                                                      |                                  |         |         |      |   |         |        |  



56



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##### Table of Contents



EQUITY OFFICE PROPERTIES TRUST


CONSOLIDATED STATEMENTS OF CASH FLOWS


|                      |                                                                                       |                                                                                                                                              |                                                          |                                                      |         |         |           |           |          |         |           |          |          |         |           |  
|--------------------- | ------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------- | ---------------------------------------------------- | ------- | ------- | --------- | --------- | -------- | ------- | --------- | -------- | -------- | ------- | --------- | -
|                      |                                                                                       | For the years ended December 31,                                                                                                             |                                                         
|                      |                                                                                       |                                                                                                                                              |                                                         
|                      |                                                                                       | 2004                                                                                                                                         |                                                          |                                                      | 2003    |         |           | 2002      |         
|                      |                                                                                       |                                                                                                                                              |                                                          |                                                      |         |         |           |           |         
|                      |                                                                                       | (Dollars in thousands)                                                                                                                       |                                                         
|Operating Activities: |                                                                                       |                                                                                                                                              |                                                          |                                                      |         |         |           |           |          |         |           |         
|                      | Net income                                                                            |                                                                                                                                              | $                                                        | 137,307                                              |         |         | $         | 655,062   |          |         | $         | 770,215  |         
|                      | Adjustments to reconcile net income to net cash provided by
    operating activities: |                                                                                                                                              |                                                          |                                                      |         |         |           |           |          |         |           |          |         
|                      |                                                                                       | Expense (revenue) recognized related to acquired lease
    obligations, net                                                                  |                                                          |                                                      | 2,114   |         |           |           | (68      | )       |           |          |         |        
|                      |                                                                                       | Amortization of discounts included in interest and dividend
    income                                                                       |                                                          |                                                      | (337    | )       |           |           | (357     | )       |           |          | (856     | )      
|                      |                                                                                       | Depreciation and amortization (including discontinued operations)                                                                            |                                                          |                                                      | 808,481 |         |           |           | 737,102  |         |           |          | 695,892  |        
|                      |                                                                                       | Ineffective portion of swap settlement payment included in
    interest expense                                                              |                                                          |                                                      | 212     |         |           |           |         |         |           |          |         |        
|                      |                                                                                       | Amortization of (premiums) discounts on unsecured notes and
    settled interest rate protection agreements included in interest
    expense |                                                          |                                                      | (3,638  | )       |           |           | (19,904  | )       |           |          | (7,183   | )      
|                      |                                                                                       | Compensation expense related to restricted shares and stock
    options issued to employees                                                  |                                                          |                                                      | 17,965  |         |           |           | 17,094   |         |           |          | 14,961   |        
|                      |                                                                                       | Income from investments in unconsolidated joint ventures                                                                                     |                                                          |                                                      | (50,304 | )       |           |           | (79,882  | )       |           |          | (106,852 | )      
|                      |                                                                                       | Net distributions from unconsolidated joint ventures                                                                                         |                                                          |                                                      | 66,829  |         |           |           | 87,268   |         |           |          | 129,753  |        
|                      |                                                                                       | Net gain on sales of real estate (including discontinued
    operations)                                                                     |                                                          |                                                      | (27,374 | )       |           |           | (161,063 | )       |           |          | (17,926  | )      
|                      |                                                                                       | (Gain) on sale of investment in Capital Trust preferred shares                                                                               |                                                          |                                                      | (2,302  | )       |           |           |         |         |           |          |         |        
|                      |                                                                                       | Impairment (including discontinued operations)                                                                                               |                                                          |                                                      | 229,170 |         |           |           | 7,500    |         |           |          |         |        
|                      |                                                                                       | Cumulative effect of a change in accounting principle                                                                                        |                                                          |                                                      | 33,697  |         |           |           |         |         |           |          |         |        
|                      |                                                                                       | Provision for doubtful accounts                                                                                                              |                                                          |                                                      | 5,455   |         |           |           | 12,803   |         |           |          | 27,995   |        
|                      |                                                                                       | Income allocated to minority interests (including discontinued
    operations)                                                               |                                                          |                                                      | 22,940  |         |           |           | 82,268   |         |           |          | 96,405   |        
|                      |                                                                                       | Changes in assets and liabilities:                                                                                                           |                                                          |                                                      |         |         |           |           |          |         |           |          |          |        
|                      |                                                                                       |                                                                                                                                              | Decrease (increase) in rents receivables                 |                                                      |         | 7,289   |           |           |          | (6,893  | )         |          |          | 30,236  |          
|                      |                                                                                       |                                                                                                                                              | (Increase) in deferred rent receivables                  |                                                      |         | (88,651 | )         |           |          | (72,240 | )         |          |          | (77,123 | )        
|                      |                                                                                       |                                                                                                                                              | Decrease (increase) in prepaid expenses and other assets |                                                      |         | 49,824  |           |           |          | (8,409  | )         |          |          | (27,861 | )        
|                      |                                                                                       |                                                                                                                                              | (Decrease) in accounts payable and accrued expenses      |                                                      |         | (7,659  | )         |           |          | (17,487 | )         |          |          | (22,883 | )        
|                      |                                                                                       |                                                                                                                                              | Increase (decrease) in other liabilities                 |                                                      |         | 6,949   |           |           |          | (13,223 | )         |          |          | 15,929  |          
|                      |                                                                                       |                                                                                                                                              |                                                          |                                                      |         |         |           |           |         
|                      |                                                                                       |                                                                                                                                              |                                                          | Net cash provided by operating activities            |         |         | 1,207,967 |           |          |         | 1,219,571 |          |          |         | 1,520,702 |  
|                      |                                                                                       |                                                                                                                                              |                                                          |                                                      |         |         |           |           |         
|Investing Activities: |                                                                                       |                                                                                                                                              |                                                          |                                                      |         |         |           |           |          |         |           |         
|                      | Property acquisitions                                                                 |                                                                                                                                              |                                                          | (472,053                                             | )       |         |           | (189,415  | )        |         |           | (53,067  | )       
|                      | Property dispositions                                                                 |                                                                                                                                              |                                                          | 414,256                                              |         |         |           | 1,345,554 |          |         |           | 377,150  |         
|                      | Capital and tenant improvements                                                       |                                                                                                                                              |                                                          | (453,227                                             | )       |         |           | (438,601  | )        |         |           | (328,930 | )       
|                      | Lease commissions and other costs                                                     |                                                                                                                                              |                                                          | (123,037                                             | )       |         |           | (138,979  | )        |         |           | (104,714 | )       
|                      | Sale of investment in Capital Trust preferred shares                                  |                                                                                                                                              |                                                          | 32,089                                               |         |         |           |          |          |         |           | 20,086   |         
|                      | Decrease in escrow deposits and restricted cash                                       |                                                                                                                                              |                                                          | 124,167                                              |         |         |           | 23,329    |          |         |           | 167,026  |         
|                      | (Investments in) distributions from unconsolidated joint ventures                     |                                                                                                                                              |                                                          | (220,833                                             | )       |         |           | 24,854    |          |         |           | (125,231 | )       
|                      | Investments in notes receivable                                                       |                                                                                                                                              |                                                          | (3,515                                               | )       |         |           |          |          |         |           |         |         
|                      | Repayments of notes receivable                                                        |                                                                                                                                              |                                                          |                                                     |         |         |           | 1,299     |          |         |           | 5,997    |         
|                      |                                                                                       |                                                                                                                                              |                                                          |                                                      |         |         |           |           |         
|                      |                                                                                       |                                                                                                                                              |                                                          | Net cash (used for) provided by investing activities |         |         | (702,153  | )         |          |         | 628,041   |          |          |         | (41,683   | )
|                      |                                                                                       |                                                                                                                                              |                                                          |                                                      |         |         |           |           |         

57



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##### Table of Contents



EQUITY OFFICE PROPERTIES TRUST


CONSOLIDATED STATEMENTS OF CASH
FLOWS  (continued)


|                      |                                                                                                           |                                          |   |            |          |   |   |            |            |   |   |            |            |  
|--------------------- | --------------------------------------------------------------------------------------------------------- | ---------------------------------------- | - | ---------- | -------- | - | - | ---------- | ---------- | - | - | ---------- | ---------- | -
|                      |                                                                                                           | For the years ended December 31,         |  
|                      |                                                                                                           |                                          |  
|                      |                                                                                                           | 2004                                     |   |            | 2003     |   |   | 2002       |           
|                      |                                                                                                           |                                          |   |            |          |   |   |            |           
|                      |                                                                                                           | (Dollars in thousands)                   |  
|Financing Activities: |                                                                                                           |                                          |   |            |          |   |   |            |            |   |   |           
|                      | Proceeds from mortgage debt                                                                               |                                          |   |           |          |   |   |           |            |   |   | 14,427     |           
|                      | Principal payments on mortgage debt                                                                       |                                          |   | (438,828   | )        |   |   | (233,809   | )          |   |   | (156,052   | )         
|                      | Proceeds from unsecured notes                                                                             |                                          |   | 2,061,979  |          |   |   | 494,810    |            |   |   | 239,127    |           
|                      | Repayment of unsecured notes                                                                              |                                          |   | (1,205,000 | )        |   |   | (700,000   | )          |   |   | (310,000   | )         
|                      | Proceeds from lines of credit                                                                             |                                          |   | 6,123,300  |          |   |   | 5,215,400  |            |   |   | 1,336,350  |           
|                      | Repayment of lines of credit                                                                              |                                          |   | (5,909,300 | )        |   |   | (5,087,100 | )          |   |   | (1,374,950 | )         
|                      | Payments of loan costs                                                                                    |                                          |   | (2,920     | )        |   |   | (8,678     | )          |   |   | (4,296     | )         
|                      | Settlement of interest rate swap agreements                                                               |                                          |   | (69,130    | )        |   |   | 768        |            |   |   | 42,810     |           
|                      | Distributions to minority interests in partially owned properties                                         |                                          |   | (12,810    | )        |   |   | (10,062    | )          |   |   | (10,401    | )         
|                      | Payment of offering costs                                                                                 |                                          |   | (84        | )        |   |   | (257       | )          |   |   | (187       | )         
|                      | Proceeds from exercise of stock options                                                                   |                                          |   | 59,269     |          |   |   | 37,744     |            |   |   | 40,015     |           
|                      | Distributions to common shareholders and unitholders                                                      |                                          |   | (902,865   | )        |   |   | (901,259   | )          |   |   | (935,083   | )         
|                      | Distributions from (contributions to) unconsolidated joint
    ventures related to financing transactions |                                          |   | 16,820     |          |   |   | 29,512     |            |   |   | (2,897     | )         
|                      | Repurchase of Common Shares                                                                               |                                          |   | (37,774    | )        |   |   | (363,486   | )          |   |   | (196,882   | )         
|                      | Redemption of Units                                                                                       |                                          |   | (3,904     | )        |   |   | (6,427     | )          |   |   | (106,690   | )         
|                      | Repurchase of preferred shares                                                                            |                                          |   | (114,073   | )        |   |   | (250,000   | )          |   |   | (199,850   | )         
|                      | Issuance of preferred shares                                                                              |                                          |   |           |          |   |   |           |            |   |   | 205,645    |           
|                      | Payment of preferred distributions                                                                        |                                          |   | (32,766    | )        |   |   | (53,841    | )          |   |   | (62,755    | )         
|                      |                                                                                                           |                                          |   |            |          |   |   |            |           
|                      |                                                                                                           | Net cash (used for) financing activities |   |            | (468,086 | ) |   |            | (1,836,685 | ) |   |            | (1,481,669 | )
|                      |                                                                                                           |                                          |   |            |          |   |   |            |           
|                      | Net increase (decrease) in cash and cash equivalents                                                      |                                          |   | 37,728     |          |   |   | 10,927     |            |   |   | (2,650     | )         
|                      | Cash and cash equivalents at the beginning of the period                                                  |                                          |   | 69,398     |          |   |   | 58,471     |            |   |   | 61,121     |           
|                      |                                                                                                           |                                          |   |            |          |   |   |            |           
|                      | Cash and cash equivalents at the end of the period                                                        |                                          | $ | 107,126    |          |   | $ | 69,398     |            |   | $ | 58,471     |           
|                      |                                                                                                           |                                          |   |            |          |   |   |            |           

58



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##### Table of Contents



EQUITY OFFICE PROPERTIES TRUST


CONSOLIDATED STATEMENTS OF CASH
FLOWS  (continued)


|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |         |          |   |         |          |   | 
|-------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------- | ------- | -------- | -------- | - | ------- | ------- | -------- | - | ------- | -------- | - | 
|                                             |                                                                                                                                                           | For the years ended December 31,                                                                                                                                                |                                                                  
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                  
|                                             |                                                                                                                                                           | 2004                                                                                                                                                                            |                                                                   |         | 2003     |          |   | 2002    |        
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           | (Dollars in thousands)                                                                                                                                                          |                                                                  
|Supplemental Information:                    |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |         |          |   |        
|                                             | Interest paid during the period, including a reduction of
    interest expense for capitalized interest of $4,648, $10,089,
    and $21,447, respectively |                                                                                                                                                                                 | $                                                                 | 824,289 |          |          | $ | 849,337 |         |          | $ | 836,573 |         
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|Non-Cash Investing and Financing Activities: |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |         |          |   |        
|                                             | Investing Activities:                                                                                                                                     |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |         |          |   |         |         
|                                             |                                                                                                                                                           | Escrow deposits used for property acquisitions                                                                                                                                  |                                                                   | $       | 36,541   |          |   | $       |        |          |   | $       | 70,030   |  
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           | Escrow deposits related to property dispositions                                                                                                                                |                                                                   | $       | (117,144 | )        |   | $       | (69,330 | )        |   | $       | (70,025  | )
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           | Mortgage loan repayment as a result of a property disposition
    (including prepayment expense of $375 in the year ended
    December 31, 2004)                                |                                                                   | $       | (5,830   | )        |   | $       | (16,279 | )        |   | $       |         |  
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           | Mortgage loan assumed upon acquisition of property                                                                                                                              |                                                                   | $       | 82,970   |          |   | $       |        |          |   | $       |         |  
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           | Mortgage loan assumed upon consolidation of property                                                                                                                            |                                                                   | $       |         |          |   | $       | 59,166  |          |   | $       |         |  
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           | Units issued in connection with property acquisition                                                                                                                            |                                                                   | $       | 50       |          |   | $       |        |          |   | $       |         |  
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           | Changes in accounts due to a like-kind exchange:                                                                                                                                |                                                                   |         |          |          |   |         |         |          |   |         |          |  
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Increase in investment in real estate due to property acquisition |         | $        | 130,203  |   |         | $       |         |   |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Decrease in investment in real estate due to property disposition |         | $        | (130,865 | ) |         | $       |         |   |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Decrease in accumulated depreciation                              |         | $        | 9,137    |   |         | $       |         |   |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Decrease in other assets and liabilities                          |         | $        | (1,770   | ) |         | $       |         |   |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           | Changes in accounts due to consolidation of existing interest in
    a property as a result of acquiring the remaining economic
    interest:                                   |                                                                   |         |          |          |   |         |         |          |   |         |          |  
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Decrease in investment in unconsolidated joint ventures           |         | $        | (157,659 | ) |         | $       |         |   |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Increase in investment in real estate                             |         | $        | 612,411  |   |         | $       |         |   |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Increase in accumulated depreciation                              |         | $        | (44,440  | ) |         | $       |         |   |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Increase in mortgage debt                                         |         | $        | (451,285 | ) |         | $       |         |   |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Increase in other assets and liabilities                          |         | $        | 40,973   |   |         | $       |         |   |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           | Changes in accounts due to partial sale of real estate:                                                                                                                         |                                                                   |         |          |          |   |         |         |          |   |         |          |  
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Increase in investment in unconsolidated joint ventures           |         | $        | 18,445   |   |         | $       | 155,710  |   |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Decrease in investment in real estate                             |         | $        | (21,726  | ) |         | $       | (169,390 | ) |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Decrease in accumulated depreciation                              |         | $        | 4,310    |   |         | $       | 19,336   |   |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           |                                                                                                                                                                                 | Decrease in other assets and liabilities                          |         | $        | (1,030   | ) |         | $       | (4,460   | ) |         | $        |  | 
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             | Financing Activities:                                                                                                                                     |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |         |          |   |         |         
|                                             |                                                                                                                                                           | Mortgage loan repayment as a result of a property disposition
    (including prepayment expense of $375 in the year ended
    December 31, 2004)                                |                                                                   | $       | 5,830    |          |   | $       | 16,279  |          |   | $       |         |  
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           | Mortgage loan assumed upon consolidation of property                                                                                                                            |                                                                   | $       |         |          |   | $       | (59,166 | )        |   | $       |         |  
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           | Issuance of unsecured notes at a discount of $10,048 in exchange
    for $250 million MandatOry Par Put Remarketed
    Securitiessm                                             |                                                                   | $       |         |          |   | $       |        |          |   | $       | (254,631 | )
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        
|                                             |                                                                                                                                                           | Exchange of $250 million MandatOry Par Put Remarketed
    Securitiessm,
    including an unamortized premium of $4,631, for $264,679 notes
    due 2012 issued in February 2002 |                                                                   | $       |         |          |   | $       |        |          |   | $       | 254,631  |  
|                                             |                                                                                                                                                           |                                                                                                                                                                                 |                                                                   |         |          |          |   |         |        



59



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




|         |                          
|-------- | -------------------------
|NOTE 1  | BUSINESS OF EQUITY OFFICE





|         |                                           
|-------- | ------------------------------------------
|NOTE 2  | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation


Consolidation of Variable Interest
Entities,


Investments in Real Estate




|                       |  |                       |               | 
|---------------------- |  | --------------------- | ------------- | 
|Asset Category         |  | Estimated Useful Life |              
|                       |  |                       |              
|Building               |  |                       | 23-45 years   | 
|Building improvements  |  |                       | 3-40 years    | 
|Tenant improvements    |  |                       | Term of lease | 
|Furniture and fixtures |  |                       | 3-12 years    | 

Business Combinations


60



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                                             
|-------- | ------------------------------------------------------------
|NOTE 2  | SUMMARY OF SIGNIFICANT ACCOUNTING
    POLICIES  (continued)







| |                                                                                                                                                                                                       
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 1) estimate the value of the real estate as if
    vacant as of the acquisition date;                                                                                                               
|
| | 2) allocate that value among land, building improvements,
    building, and equipment and determine the associated asset life
    for each;                                                           
|
| | 3) compute the value of the difference between the as
    if vacant value and the purchase price, which will
    represent the total intangible assets;                                             
|
| | 4) allocate the value of the above and below market leases
    to the intangible assets and determine the associated life of
    the above/below market leases;                                       
|
| | 5) calculate the value and associated life of tenant
    relationships, if any, by taking the direct identifiable
    benefits of the customer relationship and discounting them to
    present value;
|
| | 6) estimate the fair value of the in-place tenant
    improvements, legal/marketing expense and leasing commissions
    and calculate the associated asset life;                                      
|
| | 7) estimate the fair value of assumed debt, if any; and                                                                                                                                               
|
| | 8) allocate the remaining intangible value to the in-place
    leases and their associated lives.                                                                                                     

Accounting for the Impairment or Disposal of
Long Lived Assets








| |                                             
| | --------------------------------------------
| | Investments in Unconsolidated Joint Ventures



61



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                                             
|-------- | ------------------------------------------------------------
|NOTE 2  | SUMMARY OF SIGNIFICANT ACCOUNTING
    POLICIES  (continued)





| |                       
| | ----------------------
| | Deferred Leasing Costs

Investments in Real Estate




| |                         
| | ------------------------
| | Deferred Financing Costs





| |                    
| | -------------------
| | Revenue Recognition





| |   |                                                        
| | - | -------------------------------------------------------
| |  | the agreement has been fully executed and delivered;   
|
| |  | services have been rendered;                           
|
| |  | the amount is fixed or determinable; and               
|
| |  | the collectibility of the amount is reasonably assured.









| |                 
| | ----------------
| | Cash Equivalents



62



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                                             
|-------- | ------------------------------------------------------------
|NOTE 2  | SUMMARY OF SIGNIFICANT ACCOUNTING
    POLICIES  (continued)



| |                                
| | -------------------------------
| | Allowance for Doubtful Accounts





| |                                    
| | -----------------------------------
| | Escrow Deposits and Restricted Cash





| |                                    
| | -----------------------------------
| | Fair Value of Financial Instruments



Accounting for Derivative Instruments and
Hedging Activities






| |                                   
| | ----------------------------------
| | Derivatives and Hedging Activities



63



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                                             
|-------- | ------------------------------------------------------------
|NOTE 2  | SUMMARY OF SIGNIFICANT ACCOUNTING
    POLICIES  (continued)



Income Taxes








| |                                                                                
| | -------------------------------------------------------------------------------
| | Reconciliation Between Net Income and Estimated Taxable
    Income (Unaudited):

|                                                            |                                                                                  |                                  |         |          |      |   |         |          |   |   |         |         |  
|----------------------------------------------------------- | -------------------------------------------------------------------------------- | -------------------------------- | ------- | -------- | ---- | - | ------- | -------- | - | - | ------- | ------- | -
|                                                            |                                                                                  | For the years ended December 31, |        
|                                                            |                                                                                  |                                  |        
|                                                            |                                                                                  | 2004                             |         |          | 2003 |   |         | 2002     |  
|                                                            |                                                                                  |                                  |         |          |      |   |         |          |  
|                                                            |                                                                                  | (Dollars in thousands)           |        
|Net income available to Common Shares                       |                                                                                  | $                                | 98,214  |          |      | $ | 603,190 |          |   | $ | 707,642 |        
|                                                            | Straight-line rent adjustments                                                   |                                  |         | (80,374  | )    |   |         | (76,847  | ) |   |         | (72,891 | )
|                                                            | Preferred distributions not deductible for tax                                   |                                  |         | 32,192   |      |   |         | 51,872   |   |   |         | 62,573  |  
|                                                            | Tax gain on sale of real estate in excess of GAAP gain                           |                                  |         | 78,268   |      |   |         | 232,299  |   |   |         | 72,658  |  
|                                                            | Excess of GAAP depreciation/amortization over tax depreciation/
    amortization |                                  |         | 360,840  |      |   |         | 230,182  |   |   |         | 146,389 |  
|                                                            | Other adjustments                                                                |                                  |         | (50,580  | )    |   |         | (57,775  | ) |   |         | (74,635 | )
|                                                            | Impairment                                                                       |                                  |         | 229,170  |      |   |         | 7,500    |   |   |         |        |  
|                                                            | Cumulative effect of a change in accounting principle                            |                                  |         | 33,697   |      |   |         |         |   |   |         |        |  
|                                                            | Net operating loss utilization                                                   |                                  |         |         |      |   |         | (69,199  | ) |   |         |        |  
|                                                            |                                                                                  |                                  |         |          |      |   |         |          |  
|Taxable income                                              |                                                                                  |                                  | 701,427 |          |      |   | 921,222 |          |   |   | 841,736 |        
|                                                            | Less capital gains                                                               |                                  |         | (119,329 | )    |   |         | (393,362 | ) |   |         | (90,584 | )
|                                                            |                                                                                  |                                  |         |          |      |   |         |          |  
|Adjusted taxable income subject to 90% dividend requirement |                                                                                  | $                                | 582,098 |          |      | $ | 527,860 |          |   | $ | 751,152 |        
|                                                            |                                                                                  |                                  |         |          |      |   |         |          |  

64



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                                             
|-------- | ------------------------------------------------------------
|NOTE 2  | SUMMARY OF SIGNIFICANT ACCOUNTING
    POLICIES  (continued)



| |                                                                                                 
| | ------------------------------------------------------------------------------------------------
| | Reconciliation Between Cash Distributions Paid and
    Distributions Paid Deduction (Unaudited):

|                                               |  |                                  |         |   |      |   |         |      |  |   |         |  
|---------------------------------------------- |  | -------------------------------- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | -
|                                               |  | For the years ended December 31, |        
|                                               |  |                                  |        
|                                               |  | 2004                             |         |   | 2003 |   |         | 2002 | 
|                                               |  |                                  |         |   |      |   |         |      | 
|                                               |  | (Dollars in thousands)           |        
|Cash dividends paid                            |  | $                                | 831,580 |   |      | $ | 854,462 |      |  | $ | 895,314 |  
|Less: Dividends designated to prior year       |  |                                  | (66,760 | ) |      |   |        |      |  |   |        |  
|Plus: Dividends designated from following year |  |                                  |        |   |      |   | 66,760  |      |  |   |        |  
|Less: Return of capital distributions          |  |                                  | (63,393 | ) |      |   |        |      |  |   | (53,578 | )
|                                               |  |                                  |         |   |      |   |         |      | 
|Dividends paid deduction                       |  | $                                | 701,427 |   |      | $ | 921,222 |      |  | $ | 841,736 |  
|                                               |  |                                  |         |   |      |   |         |      | 



| |                                               
| | ----------------------------------------------
| | Characterization of Distributions (Unaudited):

|                               |  |                                  |         |  |      |  |       |      |  |   |         |  |  |   |       |   |   |   |         |  |  |  |       |  
|------------------------------ |  | -------------------------------- | ------- |  | ---- |  | ----- | ---- |  | - | ------- |  |  | - | ----- | - | - | - | ------- |  |  |  | ----- | -
|                               |  | For the years ended December 31, |        
|                               |  |                                  |        
|                               |  | 2004                             |         |  | 2003 |  |       | 2002 | 
|                               |  |                                  |         |  |      |  |       |      | 
|                               |  | $                                |         |  | %    |  |       | $    |  |   | %       |  |  | $ |       |   | % |  
|                               |  |                                  |         |  |      |  |       |      |  |   |         |  |  |   |       |   |   |  
|                               |  | (Dollars in thousands)           |        
|Ordinary income                |  | $                                | 614,358 |  |      |  | 76.9  | %    |  | $ | 456,674 |  |  |   | 56.9  | % |   | $ | 694,986 |  |  |  | 83.5  | %
|Qualified dividends            |  |                                  | 7,308   |  |      |  | 0.9   | %    |  |   | 3,210   |  |  |   | 0.4   | % |   |   |        |  |  |  |      |  
|Return of capital              |  |                                  | 63,393  |  |      |  | 7.9   | %    |  |   |        |  |  |   |      |   |   |   | 53,578  |  |  |  | 6.4   | %
|Capital gains                  |  |                                  | 84,366  |  |      |  | 10.6  | %    |  |   | 227,133 |  |  |   | 28.3  | % |   |   | 60,656  |  |  |  | 7.3   | %
|Unrecaptured section 1250 gain |  |                                  | 29,963  |  |      |  | 3.7   | %    |  |   | 115,573 |  |  |   | 14.4  | % |   |   | 23,521  |  |  |  | 2.8   | %
|                               |  |                                  |         |  |      |  |       |      |  |   |         |  |  |   |       |   |   |  
|Common distributions           |  |                                  | 799,388 |  |      |  | 100.0 | %    |  |   | 802,590 |  |  |   | 100.0 | % |   |   | 832,741 |  |  |  | 100.0 | %
|                               |  |                                  |         |  |      |  |       |      |  |   |         |  |  |   |       |   |   |  
|Preferred distributions        |  |                                  | 32,192  |  |      |  |       |      |  |   | 51,872  |  |  |   |       |   |   |   | 62,573  |  |  |  |       |  
|                               |  |                                  |         |  |      |  |       |      |  |   |         |  |  |   |       |   |   |  
|Total REIT distributions       |  | $                                | 831,580 |  |      |  |       |      |  | $ | 854,462 |  |  |   |       |   |   | $ | 895,314 |  |  |  |       |  
|                               |  |                                  |         |  |      |  |       |      |  |   |         |  |  |   |       |   |   |  



| |                   
| | ------------------
| | Minority Interests



| |                
| | ---------------
| | EOP Partnership





| |                           
| | --------------------------
| | Partially Owned Properties



65



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                                             
|-------- | ------------------------------------------------------------
|NOTE 2  | SUMMARY OF SIGNIFICANT ACCOUNTING
    POLICIES  (continued)



Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity






| |                 
| | ----------------
| | Use of Estimates





| |                  
| | -----------------
| | Reclassifications





| |                                        
| | ---------------------------------------
| | Share Based Employee Compensation Plans

Accounting for
Stock Based Compensation , Accounting for Stock-Based


66



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                                             
|-------- | ------------------------------------------------------------
|NOTE 2  | SUMMARY OF SIGNIFICANT ACCOUNTING
    POLICIES  (continued)

Compensation  Transition and
Disclosure  an Amendment of FASB Statement
No. 123 Accounting for Stock Issued to Employees




|                                                                                                                       |                                                                      |                                  |        |      |      |   |         |      |  |   |         |      | 
|---------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------- | -------------------------------- | ------ | ---- | ---- | - | ------- | ---- |  | - | ------- | ---- | 
|                                                                                                                       |                                                                      | For the years ended December 31, |       
|                                                                                                                       |                                                                      |                                  |       
|                                                                                                                       |                                                                      | 2004                             |        |      | 2003 |   |         | 2002 | 
|                                                                                                                       |                                                                      |                                  |        |      |      |   |         |      | 
|                                                                                                                       |                                                                      | (Dollars in thousands,           |       
|                                                                                                                       |                                                                      | except per share data)           |       
|Historical net income available to common shareholders                                                                 |                                                                      | $                                | 98,214 |      |      | $ | 603,190 |      |  | $ | 707,642 |     
|Add back compensation expense for share options included in
    historical net income available to common shareholders |                                                                      |                                  | 5,150  |      |      |   | 2,907   |      |  |   | 1,265   |     
|Deduct compensation expense for share options determined under
    fair value based method                             |                                                                      |                                  | (9,493 | )    |      |   | (10,916 | )    |  |   | (12,117 | )   
|Allocation of net expense to minority interests in EOP
    Partnership                                                 |                                                                      |                                  | 464    |      |      |   | 877     |      |  |   | 1,215   |     
|                                                                                                                       |                                                                      |                                  |        |      |      |   |         |      | 
|Pro forma net income available to common shareholders                                                                  |                                                                      | $                                | 94,335 |      |      | $ | 596,058 |      |  | $ | 698,005 |     
|                                                                                                                       |                                                                      |                                  |        |      |      |   |         |      | 
|Earnings per share  basic:                                                                                            |                                                                      |                                  |        |      |      |   |         |      |  |   |         |     
|                                                                                                                       | Historical net income available to common shareholders
    per share |                                  | $      | 0.25 |      |   | $       | 1.50 |  |   | $       | 1.71 | 
|                                                                                                                       | Pro forma net income available to common shareholders
    per share  |                                  | $      | 0.24 |      |   | $       | 1.49 |  |   | $       | 1.68 | 
|Earnings per share  diluted:                                                                                          |                                                                      |                                  |        |      |      |   |         |      |  |   |         |     
|                                                                                                                       | Historical net income available to common shareholders
    per share |                                  | $      | 0.24 |      |   | $       | 1.50 |  |   | $       | 1.70 | 
|                                                                                                                       | Pro forma net income available to common shareholders
    per share  |                                  | $      | 0.23 |      |   | $       | 1.48 |  |   | $       | 1.68 | 

Share-Based
Payment




67



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                                             
|-------- | ------------------------------------------------------------
|NOTE 2  | SUMMARY OF SIGNIFICANT ACCOUNTING
    POLICIES  (continued)







|         |                           
|-------- | --------------------------
|NOTE 3  | VARIABLE INTEREST ENTITIES



SunAmerica Center






|                                                                          |  |                        |          |     
|------------------------------------------------------------------------- |  | ---------------------- | -------- | ----
|                                                                          |  | (Dollars in thousands) |         
|                                                                          |  |                        |         
|Investment in real estate                                                 |  | $                      | 330,787  |     
|Accumulated depreciation                                                  |  | $                      | (31,219  | )   
|Mortgage debt                                                             |  | $                      | (203,225 | )   
|Net other assets and liabilities, including a net discount of
    $31,476 |  | $                      | (130,040 | )(a)






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | As of January 1, 2004, our joint venture partners
    share of the mezzanine-level debt of approximately
    $49.7 million is recorded in other liabilities, which is
    net of a discount of approximately $31.5 million. Interest
    expense on the approximate $66 million face amount of the
    joint venture partners debt is accrued at 7.25% per
    annum and the discount is amortized to interest expense through
    the maturity of the mezzanine-level loan in 2014. The remaining
    debt of approximately $15 million does not accrue interest.

68



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                         
|-------- | ----------------------------------------
|NOTE 3  | VARIABLE INTEREST ENTITIES  (continued)

Concar






|                                                |  |                        |         |  
|----------------------------------------------- |  | ---------------------- | ------- | -
|                                                |  | (Dollars in thousands) |        
|                                                |  |                        |        
|Investment in real estate                       |  | $                      | 53,154  |  
|Accumulated depreciation                        |  | $                      | (1,274  | )
|Investment in unconsolidated joint ventures     |  | $                      | (54,731 | )
|Minority Interests  partially owned properties |  | $                      | (3,054  | )
|Net other assets and liabilities                |  | $                      | 5,905   |  



|         |                           
|-------- | --------------------------
|NOTE 4  | INVESTMENTS IN REAL ESTATE



|                                                                             |                            |                                |            |            |            |   |            |            |            | 
|---------------------------------------------------------------------------- | -------------------------- | ------------------------------ | ---------- | ---------- | ---------- | - | ---------- | ---------- | ---------- | 
|                                                                             |                            | December 31,                   |           
|                                                                             |                            |                                |           
|                                                                             |                            | 2004                           |            |            | 2003       |  
|                                                                             |                            |                                |            |            |            |  
|                                                                             |                            | (Dollars in thousands)         |           
|Land                                                                         |                            | $                              | 2,968,993  |            |            | $ | 2,732,828  |           
|Land available for development                                               |                            |                                | 252,524    |            |            |   | 251,151    |           
|Building                                                                     |                            |                                | 20,191,223 |            |            |   | 19,437,414 |           
|Building improvements                                                        |                            |                                | 549,357    |            |            |   | 690,710    |           
|Tenant improvements                                                          |                            |                                | 1,176,280  |            |            |   | 968,267    |           
|Furniture and fixtures                                                       |                            |                                | 84,563     |            |            |   | 105,629    |           
|Developments in process                                                      |                            |                                | 40,492     |            |            |   | 75,232     |           
|Investment in real estate held for sale, net of accumulated
    depreciation |                            |                                | 41,255     |            |            |   | 43,911     |           
|                                                                             |                            |                                |            |            |            |  
|                                                                             | Investments in real estate |                                |            | 25,304,687 |            |   |            | 24,305,142 |           
|                                                                             | Accumulated depreciation   |                                |            | (3,164,511 | )          |   |            | (2,571,002 | )         
|                                                                             |                            |                                |            |            |            |  
|                                                                             |                            | Net investments in real estate |            | $          | 22,140,176 |   |            | $          | 21,734,140 | 
|                                                                             |                            |                                |            |            |            |  

69



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                         
|-------- | ----------------------------------------
|NOTE 4  | INVESTMENTS IN REAL ESTATE  (continued)



|                   |                                |          |                    |             |                |             |    |   |             |          |           |             |  |   |         |         | 
|------------------ | ------------------------------ | -------- | ------------------ | ----------- | -------------- | ----------- | -- | - | ----------- | -------- | --------- | ----------- |  | - | ------- | ------- | 
|                   |                                |          |                    |             |                |             |    |   |             | Purchase |          
|                   |                                |          |                    |             |                | Number of   |    |   |             |          | Price     |            
|                   |                                |          |                    | Acquisition |                | Buildings   |    |   | Square Feet |          |           | (Dollars in | 
|Property           |                                | Location |                    | Date        |                | (Unaudited) |    |   | (Unaudited) |          |           | thousands)  | 
|                   |                                |          |                    |             |                |             |    |   |             |          |           |             | 
|2004:              |                                |          |                    |             |                |             |    |   |             |          |           |             |  |   |         |        
|Office Properties: |                                |          |                    |             |                |             |    |   |             |          |           |             |  |   |         |        
|                   | 1301 Avenue of the Americas(a) |          | New York, NY       |             | February/April |             |    |  |             |          |           |            |  |   | $       | 151,132 | 
|                   | American Center                |          | Tysons Corner, VA |             | May 25         |             |    | 2 |             |          |           | 328,741     |  |   |         | 60,500  | 
|                   | 500 Orange Tower(a)            |          | Orange, CA         |             | May 25         |             |    |  |             |          |           |            |  |   |         | 50      | 
|                   | Colorado Center(a)(b)          |          | Santa Monica, CA   |             | July 30        |             |    | 6 |             |          |           | 1,091,090   |  |   |         | 221,785 | 
|                   | 717 Fifth Avenue(c)            |          | New York, NY       |             | September 8    |             |    | 1 |             |          |           | 323,984     |  |   |         | 160,500 | 
|                   | Olympus Corporate Centre       |          | Roseville, CA      |             | September 22   |             |    | 4 |             |          |           | 191,494     |  |   |         | 37,923  | 
|                   | Redstone Plaza(d)              |          | Newport Beach, CA  |             | September 23   |             |    | 2 |             |          |           | 166,562     |  |   |         | 38,000  | 
|                   | Commerce Plaza(d)              |          | Oakbrook, IL       |             | September 23   |             |    | 3 |             |          |           | 510,757     |  |   |         | 99,000  | 
|                   | 5800 & 6000 Meadows            |          | Lake Oswego, OR    |             | September 30   |             |    | 2 |             |          |           | 198,347     |  |   |         | 49,000  | 
|                   | La Jolla Executive Tower       |          | La Jolla, CA       |             | November 17    |             |    | 1 |             |          |           | 227,570     |  |   |         | 70,500  | 
|                   | Westech 360                    |          | Austin, TX         |             | November 19    |             |    | 4 |             |          |           | 178,777     |  |   |         | 28,604  | 
|                   | Shoreline Office Center        |          | Mill Valley, CA    |             | December 14    |             |    | 2 |             |          |           | 97,910      |  |   |         | 19,175  | 
|                   | Foundry Square II(a)           |          | San Francisco, CA  |             | December 30    |             |    |  |             |          |           |            |  |   |         | 2,700   | 
|                   |                                |          |                    |             |                |             |    |   |             |          |           |             | 
|                   |                                |          |                    |             |                |             | 27 |   |             |          | 3,315,232 |             |  | $ | 938,869 |        
|                   |                                |          |                    |             |                |             |    |   |             |          |           |             | 
|Vacant Land:       |                                |          |                    |             |                |             |    |   |             |          |           |             |  |   |         |        
|                   | Station Oaks Landing           |          | Walnut Creek, CA   |             | January 14     |             |    |  |             |          |           |            |  |   | $       | 15      | 
|                   | Dulles Station(a)(e)           |          | Herndon, VA        |             | September 15   |             |    |  |             |          |           |            |  |   |         | 7,600   | 
|                   | La Jolla Centre III & IV       |          | San Diego, CA      |             | December 22    |             |    |  |             |          |           |            |  |   |         | 5,526   | 
|                   |                                |          |                    |             |                |             |    |   |             |          |           |             | 
|                   |                                |          |                    |             |                |             |   |   |             |          |          |             |  | $ | 13,141  |        
|                   |                                |          |                    |             |                |             |    |   |             |          |           |             | 
|2003:              |                                |          |                    |             |                |             |    |   |             |          |           |             |  |   |         |        
|Office Properties: |                                |          |                    |             |                |             |    |   |             |          |           |             |  |   |         |        
|                   | The John Hancock Complex(a)    |          | Boston, MA         |             | May 21         |             |    |  |             |          |           |            |  |   | $       | 25,132  | 
|                   | U.S. Bank Tower                |          | Denver, CO         |             | August 12      |             |    | 1 |             |          |           | 485,902     |  |   |         | 80,200  | 
|                   | Key Center(a)                  |          | Bellevue, WA       |             | September 10   |             |    |  |             |          |           |            |  |   |         | 15,600  | 
|                   | 225 West Santa Clara Street    |          | San Jose, CA       |             | December 31    |             |    | 1 |             |          |           | 343,391     |  |   |         | 103,041 | 
|                   |                                |          |                    |             |                |             |    |   |             |          |           |             | 
|                   |                                |          |                    |             |                |             | 2  |   |             |          | 829,293   |             |  | $ | 223,973 |        
|                   |                                |          |                    |             |                |             |    |   |             |          |           |             | 
|Vacant Land:       |                                |          |                    |             |                |             |    |   |             |          |           |             |  |   |         |        
|                   | Parkshore Plaza Phase V        |          | Folsom, CA         |             | September 30   |             |    |  |             |          |           |            |  |   | $       | 3,423   | 
|                   |                                |          |                    |             |                |             |    |   |             |          |           |             | 
|Other:             |                                |          |                    |             |                |             |    |   |             |          |           |             |  |   |         |        
|                   | Riverside Centre Land          |          | Portland, OR       |             | August 15      |             |    |  |             |          |           |            |  |   | $       | 360     | 
|                   |                                |          |                    |             |                |             |    |   |             |          |           |             | 

70



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                         
|-------- | ----------------------------------------
|NOTE 4  | INVESTMENTS IN REAL ESTATE  (continued)

|                   |                               |          |                  |             |              |             |   |   |             |          |         |             |  |   |         |        | 
|------------------ | ----------------------------- | -------- | ---------------- | ----------- | ------------ | ----------- | - | - | ----------- | -------- | ------- | ----------- |  | - | ------- | ------ | 
|                   |                               |          |                  |             |              |             |   |   |             | Purchase |        
|                   |                               |          |                  |             |              | Number of   |   |   |             |          | Price   |            
|                   |                               |          |                  | Acquisition |              | Buildings   |   |   | Square Feet |          |         | (Dollars in | 
|Property           |                               | Location |                  | Date        |              | (Unaudited) |   |   | (Unaudited) |          |         | thousands)  | 
|                   |                               |          |                  |             |              |             |   |   |             |          |         |             | 
|2002:              |                               |          |                  |             |              |             |   |   |             |          |         |             |  |   |         |       
|Office Properties: |                               |          |                  |             |              |             |   |   |             |          |         |             |  |   |         |       
|                   | Griffin Towers(a)             |          | Santa Ana, CA    |             | March 25     |             |   |  |             |          |         |            |  |   | $       | 50,800 | 
|                   | Army and Navy Club Building   |          | Washington, D.C. |             | May 24       |             |   | 1 |             |          |         | 102,822     |  |   |         | 37,375 | 
|                   | Liberty Place                 |          | Washington, D.C. |             | September 13 |             |   | 1 |             |          |         | 157,550     |  |   |         | 54,948 | 
|                   |                               |          |                  |             |              |             |   |   |             |          |         |             | 
|                   |                               |          |                  |             |              |             | 2 |   |             |          | 260,372 |             |  | $ | 143,123 |       
|                   |                               |          |                  |             |              |             |   |   |             |          |         |             | 
|Other:             |                               |          |                  |             |              |             |   |   |             |          |         |             |  |   |         |       
|                   | 10880 Wilshire Boulevard Land |          | Los Angeles, CA  |             | November 20  |             |   |  |             |          |         |            |  |   | $       | 28,009 | 
|                   |                               |          |                  |             |              |             |   |   |             |          |         |             | 






|    |                                                                                                                                                                                                                                
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | See Joint Venture Activity below.                                                                                                                                                                                              
|   
|(b) | We acquired a 50% interest in this office property and account
    for our investment under the equity method (see
    Note 8  Investments in Unconsolidated Joint
    Ventures).                                             
|   
|(c) | This property consists of both office and retail space. We
    acquired all of the office space, except for the fourth floor.
    An unaffiliated party acquired all of the retail space and the
    fourth floor office space.
|   
|(d) | These properties were acquired through a like-kind exchange
    transaction in which we disposed of certain industrial
    properties (see Note 5  Sales of Real Estate).                                                     
|   
|(e) | We acquired a 70% interest in this vacant land parcel (see
    Note 13  Minority Interests in Partially Owned
    Properties).                                                                                                







| |                       
| | ----------------------
| | Joint Venture Activity

2004




71



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                         
|-------- | ----------------------------------------
|NOTE 4  | INVESTMENTS IN REAL ESTATE  (continued)









2003






2002








72



---



##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)


NOTE 4  INVESTMENTS IN REAL
ESTATE  (continued)






|         |                     
|-------- | --------------------
|NOTE 5  | SALES OF REAL ESTATE

2004






| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) Of the 71 industrial properties disposed of during
    2004, 29 were sold in a single transaction to an unrelated party
    for approximately $73.3 million in cash (before closing
    costs) and two office properties valued at approximately
    $137.0 million for total consideration of approximately
    $210.3 million (35% monetary/65% nonmonetary). The net book
    value of the 29 industrial properties sold was approximately
    $198.0 million. This transaction was accounted for as a
    like-kind exchange transaction which also included cash. Because
    the transaction included a monetary and nonmonetary component,
    we recognized a gain on sale of approximately $3.6 million
    on the monetary portion of the transaction. The nonmonetary
    portion of this transaction yielded no gain or loss. The
    remaining book value of the industrial properties, or
    approximately $130.0 million, represents the book value of
    the two office properties acquired in the transaction. The two
    office properties acquired are Commerce Plaza and Redstone
    Plaza, as further described in Note 4 
    Investments in Real Estate.

2003




2002




73



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                   
|-------- | ----------------------------------
|NOTE 5  | SALES OF REAL ESTATE  (continued)

Property Held for Sale






|                                                                                               |                                                                                           |                                  |                  |        |        |        |         |        |        |        |         |        |         |         | 
|---------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------- | -------------------------------- | ---------------- | ------ | ------ | ------ | ------- | ------ | ------ | ------ | ------- | ------ | ------- | ------- | 
|                                                                                               |                                                                                           | For the years ended December 31, |                 
|                                                                                               |                                                                                           |                                  |                 
|                                                                                               |                                                                                           | 2004                             |                  |        | 2003   |        |         | 2002   |       
|                                                                                               |                                                                                           |                                  |                  |        |        |        |         |        |       
|                                                                                               |                                                                                           | (Dollars in thousands)           |                 
|Property operating revenues                                                                    |                                                                                           | $                                | 32,969           |        |        | $      | 142,310 |        |        | $      | 230,623 |       
|                                                                                               |                                                                                           |                                  |                  |        |        |        |         |        |       
|Expenses:                                                                                      |                                                                                           |                                  |                  |        |        |        |         |        |        |        |         |       
|                                                                                               | Depreciation and amortization                                                             |                                  |                  | 9,459  |        |        |         | 28,437 |        |        |         | 40,819 |        
|                                                                                               | Property operating                                                                        |                                  |                  | 11,902 |        |        |         | 41,169 |        |        |         | 69,574 |        
|                                                                                               | Ground rent                                                                               |                                  |                  |       |        |        |         | 18     |        |        |         | 164    |        
|                                                                                               | Impairment                                                                                |                                  |                  | 898    |        |        |         |       |        |        |         |       |        
|                                                                                               |                                                                                           |                                  |                  |        |        |        |         |        |       
|                                                                                               |                                                                                           | Total expenses                   |                  |        | 22,259 |        |         |        | 69,624 |        |         |        | 110,557 |        
|                                                                                               |                                                                                           |                                  |                  |        |        |        |         |        |       
|                                                                                               |                                                                                           |                                  | Operating income |        |        | 10,710 |         |        |        | 72,686 |         |        |         | 120,066 | 
|                                                                                               |                                                                                           |                                  |                  |        |        |        |         |        |       
|Other income (expense):                                                                        |                                                                                           |                                  |                  |        |        |        |         |        |        |        |         |       
|                                                                                               | Interest and dividend income                                                              |                                  |                  | 2      |        |        |         | 161    |        |        |         | 233    |        
|                                                                                               | Interest expense and amortization of deferred financing costs
    and prepayment expenses |                                  |                  | (672   | )      |        |         | (649   | )      |        |         | (994   | )      
|                                                                                               |                                                                                           |                                  |                  |        |        |        |         |        |       
|                                                                                               |                                                                                           | Total other income (expense)     |                  |        | (670   | )      |         |        | (488   | )      |         |        | (761    | )      
|                                                                                               |                                                                                           |                                  |                  |        |        |        |         |        |       
|Income before income taxes and net gain on sales of real estate
    and property held for sale |                                                                                           |                                  | 10,040           |        |        |        | 72,198  |        |        |        | 119,305 |       
|Income taxes                                                                                   |                                                                                           |                                  | (5               | )      |        |        | 82      |        |        |        | (394    | )     
|Income of partially owned properties allocated to minority
    interest partners               |                                                                                           |                                  | (220             | )      |        |        | (36     | )      |        |        | (80     | )     
|Net gain on sales of real estate and property held for sale                                    |                                                                                           |                                  | 5,473            |        |        |        | 61,953  |        |        |        | 17,926  |       
|                                                                                               |                                                                                           |                                  |                  |        |        |        |         |        |       
|Net income                                                                                     |                                                                                           | $                                | 15,288           |        |        | $      | 134,197 |        |        | $      | 136,757 |       
|                                                                                               |                                                                                           |                                  |                  |        |        |        |         |        |       
|Property net operating income from discontinued operations                                     |                                                                                           | $                                | 21,067           |        |        | $      | 101,141 |        |        | $      | 161,049 |       
|                                                                                               |                                                                                           |                                  |                  |        |        |        |         |        |       



|         |                                                                                 
|-------- | --------------------------------------------------------------------------------
|NOTE 6  | REALIZED GAIN ON SETTLEMENT OF DERIVATIVES AND SALE OF
    MARKETABLE SECURITIES

2004




74



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                                                                               
|-------- | ----------------------------------------------------------------------------------------------
|NOTE 6  | REALIZED GAIN ON SETTLEMENT OF DERIVATIVES AND SALE OF
    MARKETABLE SECURITIES  (continued)





2003






|         |           
|-------- | ----------
|NOTE 7  | IMPAIRMENT





75



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                             
|-------- | --------------------------------------------
|NOTE 8  | INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES



|                                         |  |                   |  |                |            |           |                   |  |        | 
|---------------------------------------- |  | ----------------- |  | -------------- | ---------- | --------- | ----------------- |  | ------ | 
|                                         |  |                   |  |                |            | Ownership |                  
|                                         |  |                   |  | Total Rentable |            |           | Interest(a)       | 
|                                         |  |                   |  | Square Feet    |            |           | as of             | 
|Office Property                          |  | Location          |  | (Unaudited)    |            |           | December 31, 2004 | 
|                                         |  |                   |  |                |            |           |                   | 
|One Post Office Square                   |  | Boston, MA        |  |                | 765,296    |           |                   |  | 50%    | 
|75-101 Federal Street                    |  | Boston, MA        |  |                | 813,195    |           |                   |  | 51.61% | 
|Rowes Wharf                              |  | Boston, MA        |  |                | 344,645    |           |                   |  | 44%    | 
|10 & 30 South Wacker                     |  | Chicago, IL       |  |                | 2,003,288  |           |                   |  | 75%    | 
|Bank One Center                          |  | Indianapolis, IN  |  |                | 1,057,877  |           |                   |  | 25%    | 
|Pasadena Towers                          |  | Los Angeles, CA   |  |                | 439,366    |           |                   |  | 25%    | 
|Promenade II                             |  | Atlanta, GA       |  |                | 774,344    |           |                   |  | 50%    | 
|SunTrust Center                          |  | Orlando, FL       |  |                | 640,741    |           |                   |  | 25%    | 
|Preston Commons                          |  | Dallas, TX        |  |                | 418,604    |           |                   |  | 50%    | 
|Sterling Plaza                           |  | Dallas, TX        |  |                | 302,747    |           |                   |  | 50%    | 
|Bank of America Tower                    |  | Seattle, WA       |  |                | 1,545,008  |           |                   |  | 50.1%  | 
|One Post                                 |  | San Francisco, CA |  |                | 421,121    |           |                   |  | 50%    | 
|161 North Clark(b)                       |  | Chicago, IL       |  |                | 1,010,520  |           |                   |  | 25%    | 
|Prominence in Buckhead(b)                |  | Atlanta, GA       |  |                | 424,309    |           |                   |  | 25%    | 
|World Trade Center East(b)               |  | Seattle, WA       |  |                | 186,912    |           |                   |  | 25%    | 
|Treat Towers(b)                          |  | Walnut Creek, CA  |  |                | 367,313    |           |                   |  | 25%    | 
|Parkshore Plaza I(b)                     |  | Folsom, CA        |  |                | 114,356    |           |                   |  | 25%    | 
|Parkshore Plaza II(b)                    |  | Folsom, CA        |  |                | 155,497    |           |                   |  | 25%    | 
|Bridge Pointe Corporate Center I & II(b) |  | San Diego, CA     |  |                | 372,653    |           |                   |  | 25%    | 
|1111 19th Street(b)                      |  | Washington, DC    |  |                | 252,014    |           |                   |  | 20%    | 
|1620 L Street(b)                         |  | Washington, DC    |  |                | 156,272    |           |                   |  | 20%    | 
|1333 H Street(b)                         |  | Washington, DC    |  |                | 244,585    |           |                   |  | 20%    | 
|Colorado Center(c)                       |  | Santa Monica, CA  |  |                | 1,090,766  |           |                   |  | 50%    | 
|1601 Market Street(d)                    |  | Philadelphia, PA  |  |                | 681,289    |           |                   |  | 11%    | 
|1700 Market Street(d)                    |  | Philadelphia, PA  |  |                | 841,172    |           |                   |  | 11%    | 
|                                         |  |                   |  |                |            |           |                   | 
|                                         |  | Total             |  |                | 15,423,890 |           |                   |  |        | 
|                                         |  |                   |  |                |            |           |                   | 






|    |  |                                                                                                                                                                                                                                                                                                     
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Represents our ownership interest for the periods presented. Net
    income, cash flow from operations and capital transactions are
    allocated to us and our joint venture partners in accordance
    with the respective partnership agreements.                                                
|   
|(b) |  | In December 2003, we sold partial interests in these office
    properties (see Note 5  Sales of Real Estate)
    and account for our remaining interest under the equity method
    of accounting.                                                                                                
|   
|(c) |  | In July 2004, we acquired a 50% interest in Colorado Center for
    approximately $221.8 million.                                                                                                                                                                                                   
|   
|(d) |  | In November 2004, we sold partial interests in these office
    properties (see Note 5  Sales of Real Estate).
    We account for our remaining investment in these properties
    under the equity method of accounting because we can exercise
    veto rights over certain significant policies.

76



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                                               
|-------- | --------------------------------------------------------------
|NOTE 8  | INVESTMENTS IN UNCONSOLIDATED JOINT
    VENTURES  (continued)

Rowes Wharf




Foundry Square IV






|                                                                                                                                                                  |                                                         |                                                              |           |           |           |   |           |           |           | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------- | ------------------------------------------------------------ | --------- | --------- | --------- | - | --------- | --------- | --------- | 
|                                                                                                                                                                  |                                                         | December 31,                                                 |          
|                                                                                                                                                                  |                                                         |                                                              |          
|                                                                                                                                                                  |                                                         | 2004                                                         |           |           | 2003      |  
|                                                                                                                                                                  |                                                         |                                                              |           |           |           |  
|                                                                                                                                                                  |                                                         | (Dollars in thousands)                                       |          
|Balance Sheets:                                                                                                                                                   |                                                         |                                                              |           |           |           |   |           |          
|                                                                                                                                                                  | Assets:                                                 |                                                              |           |           |           |   |           |           |          
|                                                                                                                                                                  | Real estate, net of accumulated depreciation            |                                                              | $         | 3,068,975 |           |   | $         | 3,258,009 |          
|                                                                                                                                                                  | Other assets                                            |                                                              |           | 343,075   |           |   |           | 339,835   |          
|                                                                                                                                                                  |                                                         |                                                              |           |           |           |  
|                                                                                                                                                                  |                                                         | Total Assets                                                 |           | $         | 3,412,050 |   |           | $         | 3,597,844 | 
|                                                                                                                                                                  |                                                         |                                                              |           |           |           |  
|                                                                                                                                                                  | Liabilities and Partners and Shareholders
    Equity: |                                                              |           |           |           |   |           |           |          
|                                                                                                                                                                  | Mortgage debt(a)                                        |                                                              | $         | 931,976   |           |   | $         | 1,308,782 |          
|                                                                                                                                                                  | Other liabilities                                       |                                                              |           | 138,010   |           |   |           | 140,259   |          
|                                                                                                                                                                  | Partners and shareholders equity                      |                                                              |           | 2,342,064 |           |   |           | 2,148,803 |          
|                                                                                                                                                                  |                                                         |                                                              |           |           |           |  
|                                                                                                                                                                  |                                                         | Total Liabilities and Partners and Shareholders
    Equity |           | $         | 3,412,050 |   |           | $         | 3,597,844 | 
|                                                                                                                                                                  |                                                         |                                                              |           |           |           |  
|Our share of historical partners and shareholders
    equity                                                                                                    |                                                         | $                                                            | 1,032,664 |           |           | $ | 1,040,373 |          
|Net excess of cost of investments over the net book value of
    underlying net assets (net of accumulated depreciation of
    $22,797 and $24,456, respectively) |                                                         |                                                              | 84,479    |           |           |   | 86,859    |          
|                                                                                                                                                                  |                                                         |                                                              |           |           |           |  
|Carrying value of investments in unconsolidated joint ventures                                                                                                    |                                                         | $                                                            | 1,117,143 |           |           | $ | 1,127,232 |          
|                                                                                                                                                                  |                                                         |                                                              |           |           |           |  
|Our share of unconsolidated non-recourse mortgage debt                                                                                                            |                                                         | $                                                            | 361,032   | (a)       |           | $ | 797,268   |          
|                                                                                                                                                                  |                                                         |                                                              |           |           |           |  






|    |                                                                                                                                            
|--- | -------------------------------------------------------------------------------------------------------------------------------------------
|(a) | Our share of the scheduled principal payments on non-recourse
    mortgage debt through maturity as of December 31, 2004 is
    as follows:

|           |       |                      |         |         | 
|---------- | ----- | -------------------- | ------- | ------- | 
|Year       |       | Dollars in thousands |        
|           |       |                      |        
|2005       |       | $                    | 31,770  |        
|2006       |       |                      | 52,283  |        
|2007       |       |                      | 4,069   |        
|2008       |       |                      | 18,691  |        
|2009       |       |                      | 11,721  |        
|Thereafter |       |                      | 242,498 |        
|           |       |                      |        
|           | Total |                      | $       | 361,032 | 
|           |       |                      |        

77



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                                                               
|-------- | --------------------------------------------------------------
|NOTE 8  | INVESTMENTS IN UNCONSOLIDATED JOINT
    VENTURES  (continued)

|                          |                                                     |                                             |                |         |         |         |   |         |         |         |   |         |         |         | 
|------------------------- | --------------------------------------------------- | ------------------------------------------- | -------------- | ------- | ------- | ------- | - | ------- | ------- | ------- | - | ------- | ------- | ------- | 
|                          |                                                     | For the years ended December 31,            |               
|                          |                                                     |                                             |               
|                          |                                                     | 2004                                        |                |         | 2003    |         |   | 2002    |        
|                          |                                                     |                                             |                |         |         |         |   |         |        
|                          |                                                     | (Dollars in thousands)                      |               
|Statements of Operations: |                                                     |                                             |                |         |         |         |   |         |         |         |   |        
|                          | Revenues                                            |                                             | $              | 485,770 |         |         | $ | 472,124 |         |         | $ | 561,482 |        
|                          |                                                     |                                             |                |         |         |         |   |         |        
|                          | Expenses:                                           |                                             |                |         |         |         |   |         |         |         |   |         |        
|                          |                                                     | Interest expense and loan cost amortization |                |         | 45,026  |         |   |         | 75,289  |         |   |         | 81,052  |        
|                          |                                                     | Depreciation and amortization               |                |         | 121,722 |         |   |         | 92,196  |         |   |         | 79,624  |        
|                          |                                                     | Operating expenses                          |                |         | 204,567 |         |   |         | 180,087 |         |   |         | 196,936 |        
|                          |                                                     |                                             |                |         |         |         |   |         |        
|                          |                                                     |                                             | Total expenses |         |         | 371,315 |   |         |         | 347,572 |   |         |         | 357,612 | 
|                          |                                                     |                                             |                |         |         |         |   |         |        
|                          | Net income before gain on sale of real estate       |                                             |                | 114,455 |         |         |   | 124,552 |         |         |   | 203,870 |        
|                          | Gain on sale of real estate                         |                                             |                |        |         |         |   | 43,255  |         |         |   | 3,703   |        
|                          |                                                     |                                             |                |         |         |         |   |         |        
|                          | Net income                                          |                                             | $              | 114,455 |         |         | $ | 167,807 |         |         | $ | 207,573 |        
|                          |                                                     |                                             |                |         |         |         |   |         |        
|Our share of:             |                                                     |                                             |                |         |         |         |   |         |         |         |   |        
|                          | Net income                                          |                                             | $              | 50,304  |         |         | $ | 79,882  |         |         | $ | 106,852 |        
|                          |                                                     |                                             |                |         |         |         |   |         |        
|                          | Interest expense and loan cost amortization         |                                             | $              | 21,319  |         |         | $ | 50,059  |         |         | $ | 53,248  |        
|                          |                                                     |                                             |                |         |         |         |   |         |        
|                          | Depreciation and amortization (real estate related) |                                             | $              | 46,621  |         |         | $ | 53,208  |         |         | $ | 48,865  |        
|                          |                                                     |                                             |                |         |         |         |   |         |        
|                          | Gain on sale of real estate                         |                                             | $              |        |         |         | $ | 7,063   |         |         | $ | 429     |        
|                          |                                                     |                                             |                |         |         |         |   |         |        



|         |              
|-------- | -------------
|NOTE 9  | MORTGAGE DEBT



78



---



##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                            
|-------- | ---------------------------
|NOTE 9  | MORTGAGE DEBT  (continued)



|                             |                                                                                         |                        |           |          |      |   |           |          |  
|---------------------------- | --------------------------------------------------------------------------------------- | ---------------------- | --------- | -------- | ---- | - | --------- | -------- | -
|                             |                                                                                         | For the years ended    |          
|                             |                                                                                         | December 31,           |          
|                             |                                                                                         |                        |          
|                             |                                                                                         | 2004                   |           |          | 2003 |  
|                             |                                                                                         |                        |           |          |      |  
|                             |                                                                                         | (Dollars in thousands) |          
|Balance at beginning of year |                                                                                         | $                      | 2,329,552 |          |      | $ | 2,520,474 |         
|                             | Repayments and scheduled principal amortization(a)                                      |                        |           | (438,828 | )    |   |           | (233,809 | )
|                             | Assumed through property acquisitions (see
    Note 4  Investments in Real Estate)     |                        |           | 534,256  |      |   |           | 59,166   |  
|                             | Assumed through consolidation of property (see
    Note 3  Variable Interest Entities) |                        |           | 203,225  |      |   |           |         |  
|                             | Repaid upon sale of property                                                            |                        |           | (5,455   | )    |   |           | (16,279  | )
|                             |                                                                                         |                        |           |          |      |  
|Balance at end of year(b)    |                                                                                         | $                      | 2,622,750 |          |      | $ | 2,329,552 |         
|                             |                                                                                         |                        |           |          |      |  






|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | During 2004, we repaid mortgage debt and unencumbered the
    following properties: 580 California, BP Tower,
    110 Atrium Place, Fremont Bayside, Industrial Drive
    Warehouse, John Marshall, and Worldwide Plaza. During 2003, we
    repaid mortgage debt and unencumbered the following properties:
    Canterbury Green, Three Stamford Plaza, Four Stamford
    Plaza, LL&E Tower, Texaco Center, and Key Center.
|   
|(b) |  | Excludes net discounts on mortgage debt of approximately
    $13.7 million as of December 31, 2004 and 2003.                                                                                                                                                                                                                                                                                                                



|                                                          |                                      |                         |   |           |           |   |   |           |           |  
|--------------------------------------------------------- | ------------------------------------ | ----------------------- | - | --------- | --------- | - | - | --------- | --------- | -
|                                                          |                                      | December 31,            |  
|                                                          |                                      |                         |  
|                                                          |                                      | 2004                    |   |           | 2003      |  
|                                                          |                                      |                         |   |           |           |  
|                                                          |                                      | (Dollars in thousands)  |  
|Balance                                                   |                                      |                         |   |           |           |   |   |          
|                                                          | Fixed interest rate mortgage debt    |                         | $ | 2,516,554 |           |   | $ | 2,293,552 |          
|                                                          | Variable interest rate mortgage debt |                         |   | 106,196   |           |   |   | 36,000    |          
|                                                          |                                      |                         |   |           |           |  
|                                                          |                                      | Subtotal                |   |           | 2,622,750 |   |   |           | 2,329,552 |  
|                                                          | Net discount on mortgage debt        |                         |   | (13,683   | )         |   |   | (13,663   | )        
|                                                          |                                      |                         |   |           |           |  
|                                                          |                                      | Total mortgage debt     |   | $         | 2,609,067 |   |   | $         | 2,315,889 |  
|                                                          |                                      |                         |   |           |           |  
|Weighted average effective interest rate at end of period |                                      |                         |   |           |           |   |   |          
|                                                          | Fixed interest rate mortgage debt(a) |                         |   | 7.80      | %         |   |   | 7.72      | %        
|                                                          | Variable interest rate mortgage debt |                         |   | 5.53      | %         |   |   | 1.72      | %        
|                                                          |                                      |                         |   |           |           |  
|                                                          |                                      | Effective interest rate |   |           | 7.71      | % |   |           | 7.63      | %
|                                                          |                                      |                         |   |           |           |  






|    |                                                                                                                                                                             
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | As of December 31, 2004 and 2003, the effective interest
    rates on the fixed interest rate mortgage debt ranged from 5.81%
    to 8.51% and 5.81% to 8.63%, respectively.

79



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|         |                            
|-------- | ---------------------------
|NOTE 9  | MORTGAGE DEBT  (continued)

Repayment Schedule




|           |       |                      |           |           | 
|---------- | ----- | -------------------- | --------- | --------- | 
|Year       |       | Dollars in thousands |          
|           |       |                      |          
|2005       |       | $                    | 1,099,649 |          
|2006       |       |                      | 286,130   |          
|2007       |       |                      | 239,745   |          
|2008       |       |                      | 134,964   |          
|2009       |       |                      | 563,308   |          
|Thereafter |       |                      | 298,954   |          
|           |       |                      |          
|           | Total |                      | $         | 2,622,750 | 
|           |       |                      |          

NOTE 10  UNSECURED NOTES




2004


Unsecured Notes  Issued:


|                     |  |                   |           |                        |        |   |           |             |  |  |                    |     |  |                  |             |  |  |  |           | 
|-------------------- |  | ----------------- | --------- | ---------------------- | ------ | - | --------- | ----------- |  |  | ------------------ | --- |  | ---------------- | ----------- |  |  |  | --------- | 
|Original Term        |  | Month of Issuance |           |                        | Amount |   |           | Coupon Rate |  |  | Effective Rate (c) |     |  | Year of Maturity |            
|                     |  |                   |           |                        |        |   |           |             |  |  |                    |     |  |                  |            
|                     |  |                   |           | (Dollars in thousands) |        |   |           |             |  |  |                   
|10 Years             |  |                   | March     |                        |        | $ | 1,000,000 |             |  |  | 4.75%              |     |  |                  | 4.25%       |  |  |  | 2014      | 
|10 Years             |  |                   | May       |                        |        |   | 45,000    |             |  |  | 3.16%              | (b) |  |                  | 3.26%       |  |  |  | 2014      | 
|6 Years              |  |                   | October   |                        |        |   | 800,000   |             |  |  | 4.65%              |     |  |                  | 4.81%       |  |  |  | 2010      | 
|6 Years              |  |                   | October   |                        |        |   | 200,000   |             |  |  | 2.64%              | (b) |  |                  | 2.77%       |  |  |  | 2010      | 
|2 Years to 6.5 Years |  |                   | Various   |                        |        |   | 34,254    | (a)         |  |  | 3.30%-5.25%        |     |  |                  | 3.61%-5.46% |  |  |  | 2006-2011 | 
|                     |  |                   |           |                        |        |   |           |             |  |  |                    |     |  |                  |            
|Total                |  |                   | 2,079,254 |                        |        |   |           |             |  |  |                    |     |  |                  |             | 
|Less Issuance Costs  |  |                   | (17,275   | )                      |        |   |           |             |  |  |                    |     |  |                  |             | 
|                     |  |                   |           |                        |        |   |           |             |  |  |                    |    
|Net Proceeds         |  | $                 | 2,061,979 |                        |        |   |           |             |  |  |                    |     |  |                  |             | 
|                     |  |                   |           |                        |        |   |           |             |  |  |                    |    

Unsecured Notes  Repaid:


|             |       |                        |         |           |             |  |       |                    |  |  |       |  | 
|------------ | ----- | ---------------------- | ------- | --------- | ----------- |  | ----- | ------------------ |  |  | ----- |  | 
|Month Repaid |       | Amount                 |         |           | Coupon Rate |  |       | Effective Rate (c) | 
|             |       |                        |         |           |             |  |       |                    | 
|             |       | (Dollars in thousands) |         |           |             |  |      
|January      |       | $                      | 300,000 |           |             |  | 6.50% |                    |  |  | 4.59% | 
|January      |       |                        | 100,000 |           |             |  | 6.90% |                    |  |  | 6.27% | 
|May          |       |                        | 200,000 |           |             |  | 6.80% |                    |  |  | 6.10% | 
|June         |       |                        | 250,000 |           |             |  | 6.50% |                    |  |  | 5.31% | 
|September    |       |                        | 30,000  |           |             |  | 7.24% |                    |  |  | 7.26% | 
|November     |       |                        | 325,000 | (d)       |             |  | 7.25% |                    |  |  | 7.64% | 
|             |       |                        |         |           |             |  |       |                    | 
|             | Total |                        | $       | 1,205,000 |             |  |       |                    |  |  |       |  | 
|             |       |                        |         |           |             |  |       |                    | 

80



---



##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




NOTE 10  UNSECURED NOTES 
(continued)


2003


Unsecured Notes  Issued:


|                    |  |                   |         |                        |        |   |         |             |  |  |                    |  |  |                  |       |  |  |  |      | 
|------------------- |  | ----------------- | ------- | ---------------------- | ------ | - | ------- | ----------- |  |  | ------------------ |  |  | ---------------- | ----- |  |  |  | ---- | 
|Original Term       |  | Month of Issuance |         |                        | Amount |   |         | Coupon Rate |  |  | Effective Rate (c) |  |  | Year of Maturity |      
|                    |  |                   |         |                        |        |   |         |             |  |  |                    |  |  |                  |      
|                    |  |                   |         | (Dollars in thousands) |        |   |         |             |  |  |                   
|10 Years            |  |                   | January |                        |        | $ | 500,000 |             |  |  | 5.88%              |  |  |                  | 5.98% |  |  |  | 2013 | 
|Less Issuance Costs |  |                   | (5,190  | )                      |        |   |         |             |  |  |                    |  |  |                  |       | 
|                    |  |                   |         |                        |        |   |         |             |  |  |                    | 
|Net Proceeds        |  | $                 | 494,810 |                        |        |   |         |             |  |  |                    |  |  |                  |       | 
|                    |  |                   |         |                        |        |   |         |             |  |  |                    | 

Unsecured Notes  Repaid:


|             |       |                        |         |         |             |  |       |                    |  |  |       |  | 
|------------ | ----- | ---------------------- | ------- | ------- | ----------- |  | ----- | ------------------ |  |  | ----- |  | 
|Month Repaid |       | Amount                 |         |         | Coupon Rate |  |       | Effective Rate (c) | 
|             |       |                        |         |         |             |  |       |                    | 
|             |       | (Dollars in thousands) |         |         |             |  |      
|February     |       | $                      | 300,000 |         |             |  | 6.38% |                    |  |  | 6.76% | 
|November     |       |                        | 400,000 |         |             |  | 7.38% |                    |  |  | 7.55% | 
|             |       |                        |         |         |             |  |       |                    | 
|             | Total |                        | $       | 700,000 |             |  |       |                    |  |  |       |  | 
|             |       |                        |         |         |             |  |       |                    | 



|                            |  |                        |      |           |      |  |      |           |  |   |               |  |  |  |          | 
|--------------------------- |  | ---------------------- | ---- | --------- | ---- |  | ---- | --------- |  | - | ------------- |  |  |  | -------- | 
|                            |  |                        |      | Effective |      |  |      |           | 
|                            |  | Coupon                 |      |           | Rate |  |      | Principal |  |   |              
|Original Term               |  | Rate                   |      |           | (c)  |  |      | Balance   |  |   | Maturity Date | 
|                            |  |                        |      |           |      |  |      |           |  |   |               | 
|                            |  | (Dollars in thousands) |     
|Unsecured Fixed Rate Notes: |  |                        |      |           |      |  |      |           |  |   |               |  |  |  |          | 
|8 Years                     |  |                        | 6.88 | %         |      |  | 6.40 | %         |  | $ | 125,000       |  |  |  | 02/01/05 | 
|7 Years                     |  |                        | 6.63 | %         |      |  | 4.99 | %         |  |   | 400,000       |  |  |  | 02/15/05 | 
|7 Years                     |  |                        | 8.00 | %         |      |  | 6.49 | %         |  |   | 100,000       |  |  |  | 07/19/05 | 
|8 Years                     |  |                        | 7.36 | %         |      |  | 7.69 | %         |  |   | 50,000        |  |  |  | 09/01/05 | 
|6 Years                     |  |                        | 8.38 | %         |      |  | 7.65 | %         |  |   | 500,000       |  |  |  | 03/15/06 | 
|9 Years                     |  |                        | 7.44 | %         |      |  | 7.74 | %         |  |   | 50,000        |  |  |  | 09/01/06 | 
|10 Years                    |  |                        | 7.13 | %         |      |  | 6.74 | %         |  |   | 100,000       |  |  |  | 12/01/06 | 
|9 Years                     |  |                        | 7.00 | %         |      |  | 6.80 | %         |  |   | 1,500         |  |  |  | 02/02/07 | 
|9 Years                     |  |                        | 6.88 | %         |      |  | 6.83 | %         |  |   | 25,000        |  |  |  | 04/30/07 | 
|9 Years                     |  |                        | 6.76 | %         |      |  | 6.76 | %         |  |   | 300,000       |  |  |  | 06/15/07 | 
|10 Years                    |  |                        | 7.41 | %         |      |  | 7.70 | %         |  |   | 50,000        |  |  |  | 09/01/07 | 
|7 Years                     |  |                        | 7.75 | %         |      |  | 7.91 | %         |  |   | 600,000       |  |  |  | 11/15/07 | 
|10 Years                    |  |                        | 6.75 | %         |      |  | 6.97 | %         |  |   | 150,000       |  |  |  | 01/15/08 | 
|10 Years                    |  |                        | 6.75 | %         |      |  | 7.01 | %         |  |   | 300,000       |  |  |  | 02/15/08 | 
|10 Years                    |  |                        | 6.80 | %         |      |  | 6.94 | %         |  |   | 500,000       |  |  |  | 01/15/09 | 
|10 Years                    |  |                        | 7.25 | %         |      |  | 7.14 | %         |  |   | 200,000       |  |  |  | 05/01/09 | 
|11 Years                    |  |                        | 7.13 | %         |      |  | 6.97 | %         |  |   | 150,000       |  |  |  | 07/01/09 | 
|10 Years                    |  |                        | 8.10 | %         |      |  | 8.22 | %         |  |   | 360,000       |  |  |  | 08/01/10 | 
|6 Years                     |  |                        | 4.65 | %         |      |  | 4.81 | %         |  |   | 800,000       |  |  |  | 10/01/10 | 
|10 Years                    |  |                        | 7.65 | %         |      |  | 7.20 | %         |  |   | 200,000       |  |  |  | 12/15/10 | 
|10 Years                    |  |                        | 7.00 | %         |      |  | 6.83 | %         |  |   | 1,100,000     |  |  |  | 07/15/11 | 
|10 Years                    |  |                        | 6.75 | %         |      |  | 7.02 | %         |  |   | 500,000       |  |  |  | 02/15/12 | 

81



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




NOTE 10  UNSECURED NOTES 
(continued)


|                                                |                                                      |                        |      |           |      |  |      |           |   |  |               |           |           |  |                   |  |  | 
|----------------------------------------------- | ---------------------------------------------------- | ---------------------- | ---- | --------- | ---- |  | ---- | --------- | - |  | ------------- | --------- | --------- |  | ----------------- |  |  | 
|                                                |                                                      |                        |      | Effective |      |  |      |           |  
|                                                |                                                      | Coupon                 |      |           | Rate |  |      | Principal |   |  |              
|Original Term                                   |                                                      | Rate                   |      |           | (c)  |  |      | Balance   |   |  | Maturity Date |          
|                                                |                                                      |                        |      |           |      |  |      |           |   |  |               |          
|                                                |                                                      | (Dollars in thousands) |     
|10 Years                                        |                                                      |                        | 5.88 | %         |      |  | 5.98 | %         |   |  | 500,000       |           |           |  | 01/15/13          | 
|20 Years                                        |                                                      |                        | 7.88 | %         |      |  | 8.08 | %         |   |  | 25,000        |           |           |  | 12/01/16          | 
|20 Years                                        |                                                      |                        | 7.35 | %         |      |  | 8.08 | %         |   |  | 200,000       |           |           |  | 12/01/17          | 
|20 Years                                        |                                                      |                        | 7.25 | %         |      |  | 7.54 | %         |   |  | 250,000       |           |           |  | 02/15/18          | 
|30 Years                                        |                                                      |                        | 7.50 | %         |      |  | 8.24 | %         |   |  | 150,000       |           |           |  | 10/01/27          | 
|30 Years                                        |                                                      |                        | 7.25 | %         |      |  | 7.31 | %         |   |  | 225,000       |           |           |  | 06/15/28          | 
|30 Years                                        |                                                      |                        | 7.50 | %         |      |  | 7.55 | %         |   |  | 200,000       |           |           |  | 04/19/29          | 
|30 Years                                        |                                                      |                        | 7.88 | %         |      |  | 7.94 | %         |   |  | 300,000       |           |           |  | 07/15/31          | 
|EOP InterNotes(e)                               |                                                      |                        | 4.31 | %         |      |  | 4.55 | %         |   |  | 34,254        |           |           |  | 11/15/06-01/15/11 | 
|                                                |                                                      |                        |      |           |      |  |      |           |   |  |               |          
|                                                | Weighted Average/Total Unsecured Fixed Rate Notes    |                        |      | 6.94      | %    |  |      | 6.87      | % |  |               | 8,445,754 |           |  |                   |  | 
|                                                |                                                      |                        |      |           |      |  |      |           |   |  |               |          
|Unsecured Variable Rate Notes:                  |                                                      |                        |      |           |      |  |      |           |   |  |               |           |           |  |                   | 
|6 Years                                         |                                                      |                        | 2.64 | %         |      |  | 2.77 | %         |   |  | 200,000       |           |           |  | 10/01/10          | 
|10 Years(f)                                     |                                                      |                        | 4.75 | %         |      |  | 4.25 | %         |   |  | 1,000,000     |           |           |  | 03/15/14          | 
|10 Years                                        |                                                      |                        | 3.16 | %         |      |  | 3.26 | %         |   |  | 45,000        |           |           |  | 05/27/14          | 
|                                                |                                                      |                        |      |           |      |  |      |           |   |  |               |          
|                                                | Weighted Average/Total Unsecured Variable Rate Notes |                        |      | 4.35      | %    |  |      | 3.98      | % |  |               | 1,245,000 |           |  |                   |  | 
|                                                |                                                      |                        |      |           |      |  |      |           |   |  |               |          
|                                                | Weighted Average/Subtotal Unsecured Notes            |                        |      | 6.60      | %    |  |      | 6.50      | % |  |               | 9,690,754 |           |  |                   |  | 
|                                                |                                                      |                        |      |           |      |  |      |           |   |  |               |          
|Net (discount) on Unsecured Fixed Rate Notes    |                                                      |                        |      |           |      |  |      |           |   |  | (6,738        | )         |           |  |                   | 
|Net (discount) on Unsecured Variable Rate Notes |                                                      |                        |      |           |      |  |      |           |   |  | (31,624       | )         |           |  |                   | 
|                                                |                                                      |                        |      |           |      |  |      |           |   |  |               |          
|                                                |                                                      | Total                  |      |           |      |  |      |           |   |  |               | $         | 9,652,392 |  |                   |  |  | 
|                                                |                                                      |                        |      |           |      |  |      |           |   |  |               |          






|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | In June 2004, we launched a new program allowing for the
    issuance of up to $500 million of unsecured medium-term
    notes for sale to retail investors through licensed brokers
    (EOP InterNotes).                                                                                                                                                                                                                                                        
|   
|(b) |  | The $45 million notes have a variable interest rate of
    LIBOR plus 77.5 basis points plus an additional
    10 basis points of loan costs. The $200 million notes
    have a variable interest rate of LIBOR plus 60 basis points
    plus an additional 13 basis points of loan costs.                                                                                                                                                                          
|   
|(c) |  | Includes the effect of settled and outstanding interest rate
    protection and interest rate swap agreements, offering and
    transaction costs and premiums and discounts on certain
    unsecured notes.                                                                                                                                                                                                                                                        
|   
|(d) |  | In November 2004, we redeemed our 7.25% Senior Exchangeable
    Notes due November 15, 2008. The total paid on the
    redemption date was the principal amount of $325 million
    plus accrued interest. In conjunction with the redemption, we
    expensed approximately $5.3 million of unamortized loan
    costs which are included in amortization of deferred financing
    costs and prepayment expenses on the consolidated statements of
    operations.
|   
|(e) |  | The rates shown are weighted average rates.                                                                                                                                                                                                                                                                                                                                                                                                                         
|   
|(f) |  | In March 2004, we entered into several interest rate swap
    agreements that effectively converted these notes to a variable
    interest rate based on the 6-month LIBOR rate (see
    Note 12  Derivative Financial Instruments).                                                                                                                                                                                                                               

82



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)


NOTE 10  UNSECURED NOTES 
(continued)


Restrictions and Covenants under Unsecured Indebtedness






|                                                                                                             |  |                    |      | 
|------------------------------------------------------------------------------------------------------------ |  | ------------------ | ---- | 
|Covenants (in each case as defined in the respective indenture)                                              |  | Actual Performance |     
|                                                                                                             |  |                    |     
|Debt to Adjusted Total Assets may not be greater than 60%                                                    |  |                    | 49%  | 
|Secured Debt to Adjusted Total Assets may not be greater than 40%                                            |  |                    | 11%  | 
|Consolidated Income Available for Debt Service to Annual Debt
    Service charge may not be less than 1.50:1 |  |                    | 2.4  | 
|Total Unencumbered Assets to Unsecured Debt may not be less than
    150%(a)                                 |  |                    | 204% | 






|    |                                                                                                                                                                                                     
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | The unsecured notes we assumed in the merger with Spieker
    Partnership, of which approximately $1.4 billion are
    outstanding at December 31, 2004, are subject to a minimum
    ratio of 165%.

NOTE 11  LINES OF CREDIT


Line of Credit




Bridge Facilities






Financial Covenants






| |   |                                                                                                                    
| | - | -------------------------------------------------------------------------------------------------------------------
| |  | total liabilities to total asset value may not exceed 0.60:1 at
    any time;                                      
|
| |  | earnings before interest, taxes, depreciation and amortization
    to interest expense may not be less than 2.00:1;

83



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NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




NOTE 11  LINES OF
CREDIT  (continued)




| |   |                                                                                                                                                                                                                               
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | cash flow to fixed charges may not be less than 1.5:1;                                                                                                                                                                        
|
| |  | secured debt to total asset value may not exceed 0.40:1;                                                                                                                                                                      
|
| |  | unsecured debt to unencumbered asset value may not exceed 0.60:1;                                                                                                                                                             
|
| |  | unencumbered net operating income to unsecured debt service may
    not be less than 2.0:1;                                                                                                                                   
|
| |  | consolidated tangible net worth may not be less than the sum of
    $10.7 billion and 70% of all net offering proceeds received
    by us or EOP Partnership after December 31, 2002;                                         
|
| |  | we may not pay any distributions to common and preferred
    shareholders and unitholders in excess of 95% of annual Funds
    From Operations (as defined in Item 7); and                                                    
|
| |  | our investments in unimproved assets, interest in taxable REIT
    subsidiaries, developments, unconsolidated joint ventures,
    mortgages and securities, in the aggregate, may not exceed 25%
    of our total asset value.

NOTE 12  DERIVATIVE FINANCIAL INSTRUMENTS


Interest Rate Swaps




Forward-Starting Interest Rate Swaps






| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We settled $500 million of forward-starting interest rate
    swaps and recognized a gain of approximately $24.0 million
    in May 2004, which is classified as realized gain on
    settlement of derivatives and sale of marketable
    securities on the consolidated statements of operations.
    The swaps were entered into in 2003 to hedge an unsecured note
    offering that was expected to occur in June 2004, but did not
    occur. The market value of these swaps at December 31, 2003
    represented an asset to us of approximately $11.1 million
    which was recorded in other assets with a corresponding
    adjustment to accumulated other comprehensive income.                                                                                                                                                                                                                                                                              
|
| |  | In conjunction with the issuance of $1.0 billion of 4.75%
    unsecured notes in March 2004 due March 2014, we paid
    $69.1 million to settle $800 million of
    forward-starting interest rate swaps that were previously
    entered into to hedge the interest rate of the $1.0 billion
    notes. Approximately $0.2 million of the settlement amount
    was immediately recognized in interest expense because the hedge
    was not perfectly effective and the remaining $68.9 million
    was recorded to accumulated other comprehensive income. The
    amount charged to accumulated other comprehensive income is
    being amortized to interest expense over the 10-year term of the
    hedged notes. The market value of these swaps at
    December 31, 2003 represented a liability to us of
    approximately $21.5 million which was recorded in other
    liabilities and a corresponding adjustment to accumulated other
    comprehensive income.

84



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




NOTE 12  DERIVATIVE FINANCIAL
INSTRUMENTS  (continued)




| |   |                                                                                                                                                                                                                                              
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Approximately $6.8 million is expected to be reclassified
    from accumulated other comprehensive income to interest expense
    in 2005 related to amortization of net payments on settlements
    of forward starting interest rate swaps.

NOTE 13  MINORITY INTERESTS IN PARTIALLY
OWNED PROPERTIES






|                                                  |                                |          |                   |                |           |           |          |  |  |       |  
|------------------------------------------------- | ------------------------------ | -------- | ----------------- | -------------- | --------- | --------- | -------- |  |  | ----- | -
|                                                  |                                |          |                   | Total Rentable |           |           |         
|                                                  |                                |          |                   | Square Feet    |           |           | Economic | 
|                                                  |                                | Location |                   | (Unaudited)    |           |           | Interest | 
|                                                  |                                |          |                   |                |           |           |          | 
|Joint Ventures with Contractual Termination Dates |                                |          |                   |                |           |           |          |  |  |      
|                                                  | The Plaza at La Jolla Village  |          | San Diego, CA     |                |           | 635,419   |          |  |  | 66.7  | %
|                                                  | 222 Berkley Street             |          | Boston, MA        |                |           | 519,608   |          |  |  | 91.5  | %
|                                                  | 500 Boylston Street            |          | Boston, MA        |                |           | 706,864   |          |  |  | 91.5  | %
|                                                  | Wells Fargo Center             |          | Minneapolis, MN   |                |           | 1,117,439 |          |  |  | 75.0  | %
|                                                  | Ferry Building (a)             |          | San Francisco, CA |                |           | 243,812   |          |  |  | 100.0 | %
|                                                  | 2951 28th Street               |          | Santa Monica, CA  |                |           | 85,000    |          |  |  | 98.0  | %
|                                                  | San Felipe Plaza               |          | Houston, TX       |                |           | 959,466   |          |  |  | 100.0 | %
|                                                  | Four Forest Plaza              |          | Dallas, TX        |                |           | 394,324   |          |  |  | 100.0 | %
|                                                  | Market Square                  |          | Washington, D.C.  |                |           | 681,051   |          |  |  | 100.0 | %
|                                                  | One Ninety One Peachtree Tower |          | Atlanta, GA       |                |           | 1,215,288 |          |  |  | 100.0 | %
|                                                  | Brea Corporate Plaza           |          | Brea, CA          |                |           | 117,195   |          |  |  | 100.0 | %
|                                                  | Northborough Tower             |          | Houston, TX       |                |           | 207,908   |          |  |  | 100.0 | %
|                                                  | Sixty State Street             |          | Boston, MA        |                |           | 823,014   |          |  |  | 100.0 | %
|                                                  | Worldwide Plaza Amenities      |          | New York, NY      |                |           |          |          |  |  | 100.0 | %
|                                                  |                                |          |                   |                |           |           |          | 
|                                                  |                                |          |                   |                | 7,706,388 |           |          |  |  |      
|                                                  |                                |          |                   |                |           |           |          | 

85



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




NOTE 13  MINORITY INTERESTS IN PARTIALLY
OWNED PROPERTIES  (continued)


|                                                     |                                                    |          |                  |                |            |           |          |  |  |       |  
|---------------------------------------------------- | -------------------------------------------------- | -------- | ---------------- | -------------- | ---------- | --------- | -------- |  |  | ----- | -
|                                                     |                                                    |          |                  | Total Rentable |            |           |         
|                                                     |                                                    |          |                  | Square Feet    |            |           | Economic | 
|                                                     |                                                    | Location |                  | (Unaudited)    |            |           | Interest | 
|                                                     |                                                    |          |                  |                |            |           |          | 
|Joint Ventures without Contractual Termination Dates |                                                    |          |                  |                |            |           |          |  |  |      
|                                                     | Waters Edge (see Note 24  Subsequent
    Events) |          | Los Angeles, CA  |                |            | 243,433   |          |  |  | 87.5  | %
|                                                     | Park Avenue Tower                                  |          | New York, NY     |                |            | 568,060   |          |  |  | 100.0 | %
|                                                     | 850 Third Avenue                                   |          | New York, NY     |                |            | 568,867   |          |  |  | 99.0  | %
|                                                     | Washington Mutual Tower                            |          | Seattle, WA      |                |            | 1,207,823 |          |  |  | 75.0  | %
|                                                     | 1301 Avenue of the Americas                        |          | New York, NY     |                |            | 1,765,694 |          |  |  | 100.0 | %
|                                                     | SunAmerica Center (b)                              |          | Century City, CA |                |            | 780,063   |          |  |  | 67.27 | %
|                                                     | Concar (b)                                         |          | San Mateo, CA    |                |            | 218,985   |          |  |  | 79.96 | %
|                                                     | Dulles Station (c)                                 |          | Herndon, VA      |                |            |          |          |  |  | 70.0  | %
|                                                     |                                                    |          |                  |                |            |           |          | 
|                                                     |                                                    |          |                  |                | 5,352,925  |           |          |  |  |      
|                                                     |                                                    |          |                  |                |            |           |          | 
|                                                     |                                                    | Total    |                  |                | 13,059,313 |           |          |  |  |      
|                                                     |                                                    |          |                  |                |            |           |          | 






|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | A joint venture between us and other unaffiliated parties leased
    the Ferry Building from the City and County of
    San Francisco, through its Port Commission (the
    Port). Under this lease, the Port is paid a stated
    base rent. In addition, once the joint venture has received from
    the project a cumulative preferred return of 8% (prior to
    stabilization) and 11% (after stabilization), then 50% of the
    proceeds from the operation and ownership of the project are
    paid to the Port as percentage rent.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   
|    |  | The joint venture redeveloped the Ferry Building in a manner to
    permit the use of federal rehabilitation tax credits
    (Historic Tax Credits). Since the original members
    of the joint venture could not take full advantage of the
    Historic Tax Credits, the joint venture admitted a new member
    who could do so. This investor member has contributed
    approximately $24.7 million in equity and will be entitled
    to a preferred return with an effective annual rate of
    approximately 3% on its capital investment. The investor
    members interest in the joint venture is subject to
    put/call rights during 2009 and 2010, the sixth and seventh
    years after the Ferry Building was placed in service in 2003.
    Upon the purchase of the investor members interest
    pursuant to the put/call, it is estimated that the joint venture
    will retain approximately $11 million of the capital
    contributed by the investor member, based on a formula to
    determine the purchase price for the investor members
    interest and after taking into account the preferred return that
    will have been paid to the investor member by such time. Through
    the creation of a master lease, our effective ownership
    percentage in the net cash flow of the Ferry Building project is
    approximately 100% after the payment to the Port of the
    percentage rent described above and the distribution of the
    preferred returns.
|   
|(b) |  | In 2004, we consolidated these office properties pursuant to
    FIN 46(R) (see Note 3 - Variable Interest Entities).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   
|(c) |  | In September 2004, we, together with a joint venture partner,
    acquired this vacant land parcel for approximately
    $10.9 million (our share of the purchase price was
    $7.6 million). The purchase price was paid with cash and a
    $2.7 million note that is payable on the date that
    construction commences on the land. We are a 70% partner in the
    joint venture and have control over major decisions.
    Accordingly, we consolidate this property. Our partners
    30% share of the joint venture is included in Minority
    Interests  Partially owned properties on the
    consolidated balance sheets.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

86



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|          |                                                                     
|--------- | --------------------------------------------------------------------
|NOTE 14  | SHAREHOLDERS EQUITY AND MANDATORILY REDEEMABLE
    PREFERRED SHARES

Common Shares




|                            |                                                                 |                     |             |            |      |  |             |             |  
|--------------------------- | --------------------------------------------------------------- | ------------------- | ----------- | ---------- | ---- |  | ----------- | ----------- | -
|                            |                                                                 | For the years ended |            
|                            |                                                                 | December 31,        |            
|                            |                                                                 |                     |            
|                            |                                                                 | 2004                |             |            | 2003 | 
|                            |                                                                 |                     |             |            |      | 
|Outstanding at January 1,   |                                                                 |                     | 400,460,388 |            |      |  | 411,200,998 |            
|                            | Repurchases/retired (a)                                         |                     |             | (1,413,230 | )    |  |             | (14,236,400 | )
|                            | Share options exercised                                         |                     |             | 2,489,462  |      |  |             | 1,661,333   |  
|                            | Units redeemed for Common Shares                                |                     |             | 1,390,129  |      |  |             | 934,261     |  
|                            | Restricted shares and share awards issued, net of cancellations |                     |             | 915,692    |      |  |             | 900,196     |  
|                            |                                                                 |                     |             |            |      | 
|Outstanding at December 31, |                                                                 |                     | 403,842,441 |            |      |  | 400,460,388 |            
|                            |                                                                 |                     |             |            |      | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | In July 2002, we announced a Common Share repurchase program
    allowing for the repurchase of up to $200 million of Common
    Shares in the open market or privately-negotiated transaction.
    This amount was later increased to $400 million in November
    2002, to $600 million in March 2003, and to
    $1.1 billion in May 2004. The repurchase program was also
    extended through May 19, 2005. Common Shares repurchased to
    fund our employee benefit programs are not considered part of
    the repurchase program. During the years ended December 31,
    2004 and 2003, 1,413,230 and 14,236,400 Common Shares were
    repurchased at an average price of $26.19 and $25.53 for
    approximately $37.0 million and $363.5 million in the
    aggregate, respectively. An additional 25,728 Common Shares were
    repurchased during December 2004 at an average price of $29.63
    for approximately $0.8 million, but were not yet retired as
    of December 31, 2004 and are still outstanding.

Distributions




Mandatorily Redeemable Preferred Shares




Preferred Shares


The Effect on the
Calculation of Earnings per Share for the Redemption or Induced
Conversion of Preferred Stock.


87



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|          |                                                                                   
|--------- | ----------------------------------------------------------------------------------
|NOTE 14  | SHAREHOLDERS EQUITY AND MANDATORILY REDEEMABLE
    PREFERRED SHARES  (continued)





|            |  |                                  |            |  |      |   |           |      |  |   |           | 
|----------- |  | -------------------------------- | ---------- |  | ---- | - | --------- | ---- |  | - | --------- | 
|            |  | For the years ended December 31, |           
|            |  |                                  |           
|            |  | 2004                             |            |  | 2003 |   |           | 2002 | 
|            |  |                                  |            |  |      |   |           |      | 
|Series A(a) |  | $                                |           |  |      | $ |          |      |  | $ | 1.3844167 | 
|Series B    |  | $                                | 2.625      |  |      | $ | 2.625     |      |  | $ | 2.625     | 
|Series C(b) |  | $                                | 0.12578125 |  |      | $ | 2.15625   |      |  | $ | 2.15625   | 
|Series E(c) |  | $                                |           |  |      | $ | 1.3015625 |      |  | $ | 1.96875   | 
|Series F(d) |  | $                                |           |  |      | $ | 1.00      |      |  | $ | 2.00      | 
|Series G(a) |  | $                                | 1.9375     |  |      | $ | 1.9375    |      |  | $ | 0.7427083 | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | In July 2002, we redeemed all 7,994,000 outstanding 8.98%
    Series A Cumulative Redeemable Preferred Shares at an
    aggregate redemption price of approximately $201.9 million,
    including accrued distributions, with the net proceeds from the
    issuance of our 8,500,000 7.75% Series G Cumulative
    Redeemable Preferred Shares.                                                                               
|   
|(b) | In January 2004, we redeemed all 4,562,900 outstanding
    85/8%
    Series C Cumulative Redeemable Preferred Shares of
    Beneficial Interest. The Series C Preferred Shares were
    redeemed at a redemption price of $25.00 per share for an
    aggregate redemption price of approximately $114.1 million.
    The deferred issuance costs of approximately $4.1 million
    were reflected as a preferred distribution.
|   
|(c) | In June 2003, we redeemed all 6,000,000 outstanding 7.875%
    Series E Cumulative Redeemable Preferred Shares, which were
    issued in connection with the Spieker Merger, at a redemption
    price of $25.00 per share for an aggregate redemption price
    of approximately $151.9 million, which includes
    approximately $1.9 million of accrued and unpaid
    distributions.                                       
|   
|(d) | In June 2003, we redeemed our 4,000,000 outstanding 8.0%
    Series F Cumulative Redeemable Preferred Shares, which were
    issued in connection with the Spieker Merger, at a redemption
    price of $25.00 per share for an aggregate redemption price
    of $100.0 million.                                                                                                                                              

88



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|          |                                                                                   
|--------- | ----------------------------------------------------------------------------------
|NOTE 14  | SHAREHOLDERS EQUITY AND MANDATORILY REDEEMABLE
    PREFERRED SHARES  (continued)

Accumulated Other Comprehensive Loss




|                             |  |                                      |         |                  |                |   |        |             |                |   |                  |              |  |             |            |  |             |                |       |                 |       |   |               |   |  |   |        |   |  |   |         |  
|---------------------------- |  | ------------------------------------ | ------- | ---------------- | -------------- | - | ------ | ----------- | -------------- | - | ---------------- | ------------ |  | ----------- | ---------- |  | ----------- | -------------- | ----- | --------------- | ----- | - | ------------- | - |  | - | ------ | - |  | - | ------- | -
|                             |  | Forward-Starting Interest Rate Swaps |         |                  |                |   |        |             |               
|                             |  |                                      |         |                  |                |   |        |             |               
|                             |  |                                      |         | Reclassification |                |   |        |             |                |   | Reclassification |              |  |            
|                             |  |                                      |         | Reversal of      |                |   |        |             | of ineffective |   |                  | Amortization |  |             | Unrealized |  |             | adjustment for |       |                 | Total |  
|                             |  | Unrealized                           |         |                  | unrealized     |   |        | Proceeds    |                |   | portion of swap  |              |  | of payments |            |  | holding     |                |       | realized losses |       |   | Accumulated   |  
|                             |  | holding                              |         |                  | holding (gain) |   |        | (payments)  |                |   | settlement       |              |  | (proceeds)  |            |  | (losses)    |                |       | (gains)         |       |   | Other         |  
|                             |  | (losses)                             |         |                  | loss on        |   |        | from        |                |   | payment to net   |              |  | from        |            |  | gains from  |                |       | included in net |       |   | Comprehensive |  
|                             |  | gains                                |         |                  | settlements    |   |        | settlements |                |   | income           |              |  | settlements |            |  | investments |                |       | income          |       |   | Loss          |  
|                             |  |                                      |         |                  |                |   |        |             |                |   |                  |              |  |             |            |  |             |                |       |                 |       |   |               |  
|                             |  | (Dollars in thousands)               |        
|Balance at December 31, 2001 |  | $                                    |        |                  |                | $ |       |             |                | $ |                 |              |  | $           |           |  |             | $              |      |                 |       | $ | (116          | ) |  | $ |       |   |  | $ | (116    | )
|Change during the period     |  |                                      | (18,611 | )                |                |   |       |             |                |   |                 |              |  |             |           |  |             |                |      |                 |       |   | 396           |   |  |   | 116    |   |  |   | (18,099 | )
|                             |  |                                      |         |                  |                |   |        |             |                |   |                  |              |  |             |            |  |             |                |       |                 |       |   |               |  
|Balance at December 31, 2002 |  |                                      | (18,611 | )                |                |   |       |             |                |   |                 |              |  |             |           |  |             |                |      |                 |       |   | 280           |   |  |   | 116    |   |  |   | (18,215 | )
|Change during the period     |  |                                      | 8,930   |                  |                |   | (768   | )           |                |   | 768              |              |  |             |           |  |             |                | (73   | )               |       |   | 848           |   |  |   | (1,142 | ) |  |   | 8,562   |  
|                             |  |                                      |         |                  |                |   |        |             |                |   |                  |              |  |             |            |  |             |                |       |                 |       |   |               |  
|Balance at December 31, 2003 |  |                                      | (9,682  | )                |                |   | (768   | )           |                |   | 768              |              |  |             |           |  |             |                | (73   | )               |       |   | 1,128         |   |  |   | (1,026 | ) |  |   | (9,653  | )
|Change during the period     |  |                                      | (34,665 | )                |                |   | 45,115 |             |                |   | (69,130          | )            |  |             | 212        |  |             |                | 5,206 |                 |       |   | 23            |   |  |   | (31    | ) |  |   | (53,270 | )
|                             |  |                                      |         |                  |                |   |        |             |                |   |                  |              |  |             |            |  |             |                |       |                 |       |   |               |  
|Balance at December 31, 2004 |  | $                                    | (44,347 | )                |                | $ | 44,347 |             |                | $ | (68,362          | )            |  | $           | 212        |  |             | $              | 5,133 |                 |       | $ | 1,151         |   |  | $ | (1,057 | ) |  | $ | (62,923 | )
|                             |  |                                      |         |                  |                |   |        |             |                |   |                  |              |  |             |            |  |             |                |       |                 |       |   |               |  



|          |                     
|--------- | --------------------
|NOTE 15  | FUTURE MINIMUM RENTS



|           |       |                      |           |            | 
|---------- | ----- | -------------------- | --------- | ---------- | 
|Year       |       | Dollars in thousands |          
|           |       |                      |          
|2005       |       | $                    | 2,484,555 |           
|2006       |       |                      | 2,223,781 |           
|2007       |       |                      | 1,943,721 |           
|2008       |       |                      | 1,650,839 |           
|2009       |       |                      | 1,359,449 |           
|Thereafter |       |                      | 4,172,816 |           
|           |       |                      |          
|           | Total |                      | $         | 13,835,161 | 
|           |       |                      |          



89



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|          |                              
|--------- | -----------------------------
|NOTE 16  | FUTURE MINIMUM LEASE PAYMENTS



|           |       |                      |           |           | 
|---------- | ----- | -------------------- | --------- | --------- | 
|Year       |       | Dollars in thousands |          
|           |       |                      |          
|2005       |       | $                    | 22,782    |          
|2006       |       |                      | 22,641    |          
|2007       |       |                      | 22,481    |          
|2008       |       |                      | 22,643    |          
|2009       |       |                      | 22,712    |          
|Thereafter |       |                      | 1,332,270 |          
|           |       |                      |          
|           | Total |                      | $         | 1,445,529 | 
|           |       |                      |          



90



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|          |                   
|--------- | ------------------
|NOTE 17  | EARNINGS PER SHARE



|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |            |   |             |            |            | 
|---------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------- | --------------------------------------------- | ----------- | ---------- | ---------- | - | ----------- | ---------- | ---------- | - | ----------- | ---------- | ---------- | 
|                                                                                                                                                     |                                     | For the years ended December 31,              |            
|                                                                                                                                                     |                                     |                                               |            
|                                                                                                                                                     |                                     | 2004                                          |             |            | 2003       |   |             | 2002       |           
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           
|                                                                                                                                                     |                                     | (Dollars in thousands, except per share data) |            
|Numerator:                                                                                                                                           |                                     |                                               |             |            |            |   |             |            |            |   |             |           
|Income from continuing operations                                                                                                                    |                                     | $                                             | 155,716     |            |            | $ | 520,865     |            |            | $ | 633,458     |           
|Preferred distributions                                                                                                                              |                                     |                                               | (39,093     | )          |            |   | (51,872     | )          |            |   | (62,573     | )         
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           
|Income from continuing operations available to common
    shareholders                                                                               |                                     |                                               | 116,623     |            |            |   | 468,993     |            |            |   | 570,885     |           
|Discontinued operations (including net gain on sales of real
    estate and property held for sale of $5,473, $61,953 and
    $17,926, respectively) |                                     |                                               | 15,288      |            |            |   | 134,197     |            |            |   | 136,757     |           
|Cumulative effect of a change in accounting principle                                                                                                |                                     |                                               | (33,697     | )          |            |   |            |            |            |   |            |           
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           
|Numerator for basic earnings per share  net income
    available to common shareholders                                                             |                                     |                                               | 98,214      |            |            |   | 603,190     |            |            |   | 707,642     |           
|Add back income allocated to minority interests in EOP
    Partnership                                                                               |                                     |                                               | 11,747      |            |            |   | 74,152      |            |            |   | 89,205      |           
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           
|Numerator for diluted earnings per share  net income
    available to common shareholders                                                           |                                     | $                                             | 109,961     |            |            | $ | 677,342     |            |            | $ | 796,847     |           
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           
|Denominator:                                                                                                                                         |                                     |                                               |             |            |            |   |             |            |            |   |             |           
|Denominator for basic earnings per share  weighted
    average Common Shares outstanding                                                            |                                     |                                               | 400,755,733 |            |            |   | 401,016,093 |            |            |   | 414,689,029 |           
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           
|Effect of dilutive potential common shares:                                                                                                          |                                     |                                               |             |            |            |   |             |            |            |   |             |           
|                                                                                                                                                     | Units                               |                                               |             | 48,163,569 |            |   |             | 49,578,372 |            |   |             | 52,445,745 |           
|                                                                                                                                                     | Share options and restricted shares |                                               |             | 2,077,945  |            |   |             | 1,966,888  |            |   |             | 2,003,946  |           
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           
|                                                                                                                                                     |                                     | Dilutive potential common shares              |             |            | 50,241,514 |   |             |            | 51,545,260 |   |             |            | 54,449,691 | 
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           
|Denominator for diluted earnings per share  weighted
    average Common Shares outstanding and dilutive potential common
    shares                 |                                     |                                               | 450,997,247 |            |            |   | 452,561,353 |            |            |   | 469,138,720 |           
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           
|Earnings per share  basic                                                                                                                           |                                     |                                               |             |            |            |   |             |            |            |   |             |           
|Income from continuing operations available to common
    shareholders, net of minority interests                                                    |                                     | $                                             | 0.29        |            |            | $ | 1.21        |            |            | $ | 1.41        |           
|Discontinued operations, net of minority interests                                                                                                   |                                     |                                               | 0.03        |            |            |   | 0.30        |            |            |   | 0.29        |           
|Cumulative effect of a change in accounting principle, net of
    minority interests                                                                 |                                     |                                               | (0.08       | )          |            |   |            |            |            |   |            |           
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           
|Net income available to common shareholders, net of minority
    interests(a)                                                                        |                                     | $                                             | 0.25        |            |            | $ | 1.50        |            |            | $ | 1.71        |           
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           
|Earnings per share  diluted                                                                                                                         |                                     |                                               |             |            |            |   |             |            |            |   |             |           
|Income from continuing operations available to common
    shareholders                                                                               |                                     | $                                             | 0.28        |            |            | $ | 1.20        |            |            | $ | 1.41        |           
|Discontinued operations                                                                                                                              |                                     |                                               | 0.03        |            |            |   | 0.30        |            |            |   | 0.29        |           
|Cumulative effect of a change in accounting principle                                                                                                |                                     |                                               | (0.07       | )          |            |   |            |            |            |   |            |           
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           
|Net income available to common shareholders(a)                                                                                                       |                                     | $                                             | 0.24        |            |            | $ | 1.50        |            |            | $ | 1.70        |           
|                                                                                                                                                     |                                     |                                               |             |            |            |   |             |            |           

91



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|          |                                 
|--------- | --------------------------------
|NOTE 17  | EARNINGS PER SHARE  (continued)



|                                        |       |                  |        |                                  |      |  |            |            |  |  |            |            |  |  |            |            | 
|--------------------------------------- | ----- | ---------------- | ------ | -------------------------------- | ---- |  | ---------- | ---------- |  |  | ---------- | ---------- |  |  | ---------- | ---------- | 
|                                        |       |                  |        | For the years ended December 31, |     
|                                        |       | Weighted Average |        |                                  |      | 
|Antidilutive Securities                 |       | Exercise Price   |        |                                  | 2004 |  |            | 2003       |  |  | 2002       |           
|                                        |       |                  |        |                                  |      |  |            |            |  |  |            |           
|Share options                           |       | $                | 29.134 |                                  |      |  | 15,153,748 |            |  |  |           |            |  |  |           |           
|Share options                           |       | $                | 29.220 |                                  |      |  |           |            |  |  | 13,436,967 |            |  |  |           |           
|Share options                           |       | $                | 29.240 |                                  |      |  |           |            |  |  |           |            |  |  | 13,032,648 |           
|Series B Preferred Shares(b)            |       | $                | 35.700 |                                  |      |  | 8,389,354  |            |  |  | 8,389,354  |            |  |  | 8,389,354  |           
|Warrants (expired on December 17, 2002) |       | $                | 39.375 |                                  |      |  |           |            |  |  |           |            |  |  | 4,808,219  |           
|                                        |       |                  |        |                                  |      |  |            |            |  |  |            |           
|                                        | Total |                  |        |                                  |      |  |            | 23,543,102 |  |  |            | 21,826,321 |  |  |            | 26,230,221 | 
|                                        |       |                  |        |                                  |      |  |            |            |  |  |            |           






|    |  |                                                                                                                                                                  
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Net income available to common shareholders per share may not
    total the sum of the per share components due to rounding.                                     
|   
|(b) |  | The amounts shown represent the resulting Common Shares upon
    conversion (see Note 14  Shareholders
    Equity and Mandatorily Redeemable Preferred Shares).





|          |                    
|--------- | -------------------
|NOTE 18  | SEGMENT INFORMATION



|                             |                       |                                           |   |           |           |  |   |           |           |  |   |           |           | 
|---------------------------- | --------------------- | ----------------------------------------- | - | --------- | --------- |  | - | --------- | --------- |  | - | --------- | --------- | 
|                             |                       | As of or for the years ended December 31, |  
|                             |                       |                                           |  
|                             |                       | 2004                                      |   |           | 2003      |  |   | 2002      |          
|                             |                       |                                           |   |           |           |  |   |           |          
|                             |                       | (Dollars in thousands)                    |  
|Property Operating Revenues: |                       |                                           |   |           |           |  |   |           |           |  |   |          
|                             | Rental                |                                           | $ | 2,554,471 |           |  | $ | 2,490,291 |           |  | $ | 2,565,132 |          
|                             | Tenant reimbursements |                                           |   | 432,733   |           |  |   | 431,516   |           |  |   | 470,966   |          
|                             | Parking               |                                           |   | 117,448   |           |  |   | 111,160   |           |  |   | 112,897   |          
|                             | Other                 |                                           |   | 76,973    |           |  |   | 88,323    |           |  |   | 128,666   |          
|                             |                       |                                           |   |           |           |  |   |           |          
|                             |                       | Total Property Operating Revenues         |   |           | 3,181,625 |  |   |           | 3,121,290 |  |   |           | 3,277,661 | 
|                             |                       |                                           |   |           |           |  |   |           |          

92



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|          |                                  
|--------- | ---------------------------------
|NOTE 18  | SEGMENT INFORMATION  (continued)

|                                                                                                            |                                                          |                                                 |           |          |           |   |           |          |           |   |           |          |           |  
|----------------------------------------------------------------------------------------------------------- | -------------------------------------------------------- | ----------------------------------------------- | --------- | -------- | --------- | - | --------- | -------- | --------- | - | --------- | -------- | --------- | -
|                                                                                                            |                                                          | As of or for the years ended December 31,       |          
|                                                                                                            |                                                          |                                                 |          
|                                                                                                            |                                                          | 2004                                            |           |          | 2003      |   |           | 2002     |          
|                                                                                                            |                                                          |                                                 |           |          |           |   |           |          |          
|                                                                                                            |                                                          | (Dollars in thousands)                          |          
|Property Operating Expenses:                                                                                |                                                          |                                                 |           |          |           |   |           |          |           |   |           |         
|                                                                                                            | Real estate taxes                                        |                                                 |           | 367,610  |           |   |           | 344,625  |           |   |           | 353,090  |          
|                                                                                                            | Insurance                                                |                                                 |           | 37,938   |           |   |           | 27,877   |           |   |           | 38,014   |          
|                                                                                                            | Repairs and maintenance                                  |                                                 |           | 350,059  |           |   |           | 332,140  |           |   |           | 336,439  |          
|                                                                                                            | Property operating                                       |                                                 |           | 428,891  |           |   |           | 405,996  |           |   |           | 405,844  |          
|                                                                                                            |                                                          |                                                 |           |          |           |   |           |          |          
|                                                                                                            |                                                          | Total Property Operating Expenses               |           |          | 1,184,498 |   |           |          | 1,110,638 |   |           |          | 1,133,387 |  
|                                                                                                            |                                                          |                                                 |           |          |           |   |           |          |          
|                                                                                                            |                                                          | Net Operating Income from Continuing Operations |           | $        | 1,997,127 |   |           | $        | 2,010,652 |   |           | $        | 2,144,274 |  
|                                                                                                            |                                                          |                                                 |           |          |           |   |           |          |          
|Property Operating Margin from Continuing Operations(a)                                                     |                                                          |                                                 | 62.8      | %        |           |   | 64.4      | %        |           |   | 65.4      | %       
|                                                                                                            |                                                          |                                                 |           |          |           |   |           |          |          
|Reconciliation of Net Operating Income from Continuing
    Operations to Income from Continuing Operations: |                                                          |                                                 |           |          |           |   |           |          |           |   |           |         
|Net Operating Income from Continuing Operations                                                             |                                                          | $                                               | 1,997,127 |          |           | $ | 2,010,652 |          |           | $ | 2,144,274 |         
|Add:                                                                                                        |                                                          |                                                 |           |          |           |   |           |          |           |   |           |         
|                                                                                                            | Fee income                                               |                                                 |           | 14,226   |           |   |           | 15,861   |           |   |           | 15,907   |          
|Less:                                                                                                       |                                                          |                                                 |           |          |           |   |           |          |           |   |           |         
|                                                                                                            | Depreciation                                             |                                                 |           | (701,216 | )         |   |           | (637,441 | )         |   |           | (598,744 | )        
|                                                                                                            | Amortization                                             |                                                 |           | (82,469  | )         |   |           | (64,473  | )         |   |           | (51,441  | )        
|                                                                                                            | Ground rent                                              |                                                 |           | (25,467  | )         |   |           | (20,287  | )         |   |           | (20,325  | )        
|                                                                                                            | Corporate general and administrative                     |                                                 |           | (52,242  | )         |   |           | (62,479  | )         |   |           | (65,790  | )        
|                                                                                                            | Impairment                                               |                                                 |           | (228,272 | )         |   |           | (7,500   | )         |   |           |         |          
|                                                                                                            |                                                          |                                                 |           |          |           |   |           |          |          
|Operating Income                                                                                            |                                                          |                                                 | 921,687   |          |           |   | 1,234,333 |          |           |   | 1,423,881 |         
|Less:                                                                                                       |                                                          |                                                 |           |          |           |   |           |          |           |   |           |         
|                                                                                                            | Other expenses                                           |                                                 |           | (813,444 | )         |   |           | (804,840 | )         |   |           | (791,849 | )        
|                                                                                                            | Income taxes                                             |                                                 |           | (2,012   | )         |   |           | (5,388   | )         |   |           | (9,101   | )        
|                                                                                                            | Minority interests:                                      |                                                 |           |          |           |   |           |          |           |   |           |          |          
|                                                                                                            |                                                          | EOP Partnership                                 |           |          | (11,747   | ) |           |          | (74,152   | ) |           |          | (89,205   | )
|                                                                                                            |                                                          | Partially owned properties                      |           |          | (10,973   | ) |           |          | (8,080    | ) |           |          | (7,120    | )
|Add:                                                                                                        |                                                          |                                                 |           |          |           |   |           |          |           |   |           |         
|                                                                                                            | Income from investments in unconsolidated joint ventures |                                                 |           | 50,304   |           |   |           | 79,882   |           |   |           | 106,852  |          
|                                                                                                            | Gain on sales of real estate                             |                                                 |           | 21,901   |           |   |           | 99,110   |           |   |           |         |          
|                                                                                                            |                                                          |                                                 |           |          |           |   |           |          |          
|Income from Continuing Operations                                                                           |                                                          | $                                               | 155,716   |          |           | $ | 520,865   |          |           | $ | 633,458   |         
|                                                                                                            |                                                          |                                                 |           |          |           |   |           |          |          
|Capital and tenant improvements and lease commissions                                                       |                                                          | $                                               | 565,538   |          |           | $ | 545,183   |          |           | $ | 428,393   |         
|                                                                                                            |                                                          |                                                 |           |          |           |   |           |          |          
|Investments in unconsolidated joint ventures                                                                |                                                          | $                                               | 1,116,748 |          |           | $ | 1,128,175 |          |           | $ | 1,077,273 |         
|                                                                                                            |                                                          |                                                 |           |          |           |   |           |          |          






|    |                                                                                                             
|--- | ------------------------------------------------------------------------------------------------------------
|(a) | Defined as Net Operating Income from Continuing Operations
    divided by Total Property Operating Revenues.

93



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)


NOTE 19  QUARTERLY DATA (UNAUDITED)


|                                                                               |                                                                                          |                                               |         |      |         |   |          |         |   |   |         |      |  |   |         |      | 
|------------------------------------------------------------------------------ | ---------------------------------------------------------------------------------------- | --------------------------------------------- | ------- | ---- | ------- | - | -------- | ------- | - | - | ------- | ---- |  | - | ------- | ---- | 
|                                                                               |                                                                                          | For the three months ended                    |        
|                                                                               |                                                                                          |                                               |        
|                                                                               |                                                                                          | 12/31/04                                      |         |      | 9/30/04 |   |          | 6/30/04 |   |   | 3/31/04 |     
|                                                                               |                                                                                          |                                               |         |      |         |   |          |         |   |   |         |     
|                                                                               |                                                                                          | (Dollars in thousands, except per share data) |        
|Total revenues(a)                                                              |                                                                                          | $                                             | 819,528 |      |         | $ | 793,928  |         |   | $ | 792,951 |      |  | $ | 789,442 |     
|Income (loss) from continuing operations(a)                                    |                                                                                          | $                                             | 72,821  |      |         | $ | (124,715 | )       |   | $ | 102,989 |      |  | $ | 104,619 |     
|Discontinued operations(a)                                                     |                                                                                          | $                                             | (2,782  | )    |         | $ | 4,436    |         |   | $ | 6,519   |      |  | $ | 7,117   |     
|Income (loss) before cumulative effect of a change in accounting
    principle |                                                                                          | $                                             | 70,039  |      |         | $ | (120,279 | )       |   | $ | 109,508 |      |  | $ | 111,736 |     
|Cumulative effect of a change in accounting principle                          |                                                                                          | $                                             |        |      |         | $ |         |         |   | $ |        |      |  | $ | (33,697 | )   
|Net income (loss)                                                              |                                                                                          | $                                             | 70,039  |      |         | $ | (120,279 | )       |   | $ | 109,508 |      |  | $ | 78,039  |     
|Earnings (loss) per share  basic:                                             |                                                                                          |                                               |         |      |         |   |          |         |   |   |         |      |  |   |         |     
|                                                                               | Income (loss) before cumulative effect of a change in accounting
    principle per share |                                               | $       | 0.15 |         |   | $        | (0.32   | ) |   | $       | 0.25 |  |   | $       | 0.23 | 
|Earnings (loss) per share  diluted:                                           |                                                                                          |                                               |         |      |         |   |          |         |   |   |         |      |  |   |         |     
|                                                                               | Income (loss) before cumulative effect of a change in accounting
    principle per share |                                               | $       | 0.15 |         |   | $        | (0.32   | ) |   | $       | 0.25 |  |   | $       | 0.23 | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | The amounts presented for the first three quarters are not equal
    to the same amounts previously reported in Form 10-Q for
    each period as a result of discontinued operations. Total
    revenues presented for the first three quarters also differ from
    the same amounts previously reported in Form 10-Q for each
    period due to the consolidation of Concar (see
    Note 3  Variable Interest Entities). Below is a
    reconciliation to the amounts previously reported in
    Form 10-Q:

|                                                                                                          |  |                            |          |   |         |   |         |         |  |   |         |  
|--------------------------------------------------------------------------------------------------------- |  | -------------------------- | -------- | - | ------- | - | ------- | ------- |  | - | ------- | -
|                                                                                                          |  | For the three months ended |         
|                                                                                                          |  |                            |         
|                                                                                                          |  | 9/30/04                    |          |   | 6/30/04 |   |         | 3/31/04 | 
|                                                                                                          |  |                            |          |   |         |   |         |         | 
|                                                                                                          |  | (Dollars in thousands)     |         
|Total revenues previously reported                                                                        |  | $                          | 790,718  |   |         | $ | 795,533 |         |  | $ | 796,213 |  
|Consolidation of Concar                                                                                   |  |                            | 5,069    |   |         |   | 4,454   |         |  |   | 5,693   |  
|Discontinued operations                                                                                   |  |                            | (1,859   | ) |         |   | (7,036  | )       |  |   | (12,464 | )
|                                                                                                          |  |                            |          |   |         |   |         |         | 
|Revised total revenues                                                                                    |  | $                          | 793,928  |   |         | $ | 792,951 |         |  | $ | 789,442 |  
|                                                                                                          |  |                            |          |   |         |   |         |         | 
|(Loss) income from continuing operations previously reported                                              |  | $                          | (125,178 | ) |         | $ | 106,088 |         |  | $ | 109,765 |  
|Discontinued operations                                                                                   |  |                            | 463      |   |         |   | (3,099  | )       |  |   | (5,146  | )
|                                                                                                          |  |                            |          |   |         |   |         |         | 
|Revised (loss) income from continuing operations                                                          |  | $                          | (124,715 | ) |         | $ | 102,989 |         |  | $ | 104,619 |  
|                                                                                                          |  |                            |          |   |         |   |         |         | 
|Discontinued operations previously reported                                                               |  | $                          | 4,899    |   |         | $ | 3,420   |         |  | $ | 1,971   |  
|Additional discontinued operations from properties sold
    subsequent to the respective reporting period |  |                            | (463     | ) |         |   | 3,099   |         |  |   | 5,146   |  
|                                                                                                          |  |                            |          |   |         |   |         |         | 
|Revised discontinued operations                                                                           |  | $                          | 4,436    |   |         | $ | 6,519   |         |  | $ | 7,117   |  
|                                                                                                          |  |                            |          |   |         |   |         |         | 

94



---



##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|          |                                         
|--------- | ----------------------------------------
|NOTE 19  | QUARTERLY DATA (UNAUDITED)  (continued)

|                                     |                      |                                               |         |      |         |   |         |         |  |   |         |      |  |   |         |      | 
|------------------------------------ | -------------------- | --------------------------------------------- | ------- | ---- | ------- | - | ------- | ------- |  | - | ------- | ---- |  | - | ------- | ---- | 
|                                     |                      | For the three months ended                    |        
|                                     |                      |                                               |        
|                                     |                      | 12/31/03                                      |         |      | 9/30/03 |   |         | 6/30/03 |  |   | 3/31/03 |     
|                                     |                      |                                               |         |      |         |   |         |         |  |   |         |     
|                                     |                      | (Dollars in thousands, except per share data) |        
|Total revenues(b)                    |                      | $                                             | 813,333 |      |         | $ | 776,083 |         |  | $ | 773,421 |      |  | $ | 774,315 |     
|Income from continuing operations(b) |                      | $                                             | 181,787 |      |         | $ | 109,397 |         |  | $ | 101,995 |      |  | $ | 127,686 |     
|Discontinued operations(b)           |                      | $                                             | 30,157  |      |         | $ | 11,286  |         |  | $ | 63,261  |      |  | $ | 29,492  |     
|Net income                           |                      | $                                             | 211,944 |      |         | $ | 120,683 |         |  | $ | 165,256 |      |  | $ | 157,178 |     
|Earnings per share  basic:          |                      |                                               |         |      |         |   |         |         |  |   |         |      |  |   |         |     
|                                     | Net income per share |                                               | $       | 0.51 |         |   | $       | 0.28    |  |   | $       | 0.37 |  |   | $       | 0.35 | 
|Earnings per share  diluted:        |                      |                                               |         |      |         |   |         |         |  |   |         |      |  |   |         |     
|                                     | Net income per share |                                               | $       | 0.50 |         |   | $       | 0.28    |  |   | $       | 0.37 |  |   | $       | 0.35 | 






|    |                                                                                                                                                                                                                                                                                            
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(b) | The amounts presented for the four quarters are not equal to the
    same amounts previously reported in Form 10-Q or
    Form 10-K for each period as a result of discontinued
    operations. Below is a reconciliation to the amounts previously
    reported in Form 10-Q or Form 10-K:

|                                                                                                          |  |                            |         |   |         |   |         |         |  |   |         |   |  |   |         |  
|--------------------------------------------------------------------------------------------------------- |  | -------------------------- | ------- | - | ------- | - | ------- | ------- |  | - | ------- | - |  | - | ------- | -
|                                                                                                          |  | For the three months ended |        
|                                                                                                          |  |                            |        
|                                                                                                          |  | 12/31/03                   |         |   | 9/30/03 |   |         | 6/30/03 |  |   | 3/31/03 |  
|                                                                                                          |  |                            |         |   |         |   |         |         |  |   |         |  
|                                                                                                          |  | (Dollars in thousands)     |        
|Total revenues previously reported                                                                        |  | $                          | 828,748 |   |         | $ | 778,060 |         |  | $ | 780,630 |   |  | $ | 788,669 |  
|Discontinued operations                                                                                   |  |                            | (15,415 | ) |         |   | (1,977  | )       |  |   | (7,209  | ) |  |   | (14,354 | )
|                                                                                                          |  |                            |         |   |         |   |         |         |  |   |         |  
|Revised total revenues                                                                                    |  | $                          | 813,333 |   |         | $ | 776,083 |         |  | $ | 773,421 |   |  | $ | 774,315 |  
|                                                                                                          |  |                            |         |   |         |   |         |         |  |   |         |  
|Income from continuing operations previously reported                                                     |  | $                          | 188,857 |   |         | $ | 110,011 |         |  | $ | 105,483 |   |  | $ | 135,089 |  
|Discontinued operations                                                                                   |  |                            | (7,070  | ) |         |   | (614    | )       |  |   | (3,488  | ) |  |   | (7,403  | )
|                                                                                                          |  |                            |         |   |         |   |         |         |  |   |         |  
|Revised income from continuing operations                                                                 |  | $                          | 181,787 |   |         | $ | 109,397 |         |  | $ | 101,995 |   |  | $ | 127,686 |  
|                                                                                                          |  |                            |         |   |         |   |         |         |  |   |         |  
|Discontinued operations previously reported                                                               |  | $                          | 23,087  |   |         | $ | 10,672  |         |  | $ | 59,773  |   |  | $ | 22,089  |  
|Additional discontinued operations from properties sold
    subsequent to the respective reporting period |  |                            | 7,070   |   |         |   | 614     |         |  |   | 3,488   |   |  |   | 7,403   |  
|                                                                                                          |  |                            |         |   |         |   |         |         |  |   |         |  
|Revised discontinued operations                                                                           |  | $                          | 30,157  |   |         | $ | 11,286  |         |  | $ | 63,261  |   |  | $ | 29,492  |  
|                                                                                                          |  |                            |         |   |         |   |         |         |  |   |         |  

NOTE 20  RELATED PARTY TRANSACTIONS




|                                                             |       |                        |       |       |      |   |       |       |  |   |       |       | 
|------------------------------------------------------------ | ----- | ---------------------- | ----- | ----- | ---- | - | ----- | ----- |  | - | ----- | ----- | 
|                                                             |       | For the years ended    |      
|                                                             |       | December 31,           |      
|                                                             |       |                        |      
|                                                             |       | 2004                   |       |       | 2003 |   |       | 2002  | 
|                                                             |       |                        |       |       |      |   |       |       | 
|                                                             |       | (Dollars in thousands) |      
|Development fees, leasing commissions and management fees(a) |       | $                      | 1,532 |       |      | $ | 3,569 |       |  | $ | 4,727 |      
|Office rent(b)                                               |       |                        | 3,755 |       |      |   | 3,959 |       |  |   | 3,904 |      
|                                                             |       |                        |       |       |      |   |       |       | 
|                                                             | Total |                        | $     | 5,287 |      |   | $     | 7,528 |  |   | $     | 8,631 | 
|                                                             |       |                        |       |       |      |   |       |       | 
|Payable to related parties at year end                       |       | $                      | 313   |       |      | $ | 273   |       |  | $ | 1,748 |      
|                                                             |       |                        |       |       |      |   |       |       | 

95



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|          |                                         
|--------- | ----------------------------------------
|NOTE 20  | RELATED PARTY TRANSACTIONS  (continued)






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | The amounts paid in 2004 and 2003 were paid to an affiliate of
    William Wilson III, one of our trustees through May 2004,
    whereas amounts paid in 2002 were paid to Wilson/ Equity Office,
    LLC (W/ EO). We entered into a joint venture
    agreement with Wilson Investors in 2000 for the purpose of
    developing, constructing, leasing and managing developments in
    northern California. We own 49.9% of W/ EO and Wilson Investors
    owns 50.1% of W/ EO. William Wilson III, through his
    ownership of Wilson Investors, indirectly owns approximately 22%
    of W/ EO and approximately 30% of any promote to which Wilson
    Investors is entitled under the joint venture agreement. We
    agreed to loan up to $25 million to Wilson Investors for
    its required contribution to W/ EO at a 15% interest rate per
    annum. In 2002, Wilson Investors repaid the outstanding loan
    balance of approximately $12.0 million of principal and
    approximately $2.0 million of accrued interest. Upon this
    repayment and as a result of certain transactions with Wilson
    Investors, the loan commitment was terminated. Our investment in
    W/ EO as of December 31, 2004 and 2003 was approximately
    $0.4 million and $1.3 million, respectively, which
    represents an indirect interest in Concar (a consolidated office
    property).



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We created joint ventures with W/ EO and also, in certain cases,
    unaffiliated parties for the development of various office
    properties. We agreed to provide first mortgage financing to the
    ownership entities of each of these developments at the greater
    of 6.5% or LIBOR plus 3.25%, generally maturing 36 months
    after initial funding or earlier at our option, in the event
    alternative financing sources are available on terms reasonably
    acceptable to Wilson Investors and any unaffiliated party. The
    aggregate amount of any such financing would generally be capped
    at 70% of budgeted construction costs (76% in the case of Concar
    which, at December 31, 2002 had been completed and leased
    and as such is now reflected as investment in real estate). At
    December 31, 2002, we had committed to make mortgage loans
    for Foundry Square IV and Concar totaling approximately
    $96 million of which approximately $74 million in
    principal and approximately $0.4 million in accrued
    interest was outstanding. The total principal and interest
    outstanding on these mortgage loans at December 31, 2004
    and 2003 was approximately $40 million. The mortgage loan
    for Foundry Square IV was repaid in 2003 in connection with
    the sale of the property. Following this sale, W/ EOs sole
    asset is its ownership interest in Concar. In accordance with
    the W/ EO operating agreement, we may, but are not required to,
    purchase the W/ EO interest in Concar.                                                                                                                                                                                                                                                                                                                                       
|
| | In December 2002, we completed a transaction with W/ EO and
    Wilson Investors pursuant to which we acquired W/ EOs
    interests in various projects known as Foundry Square II,
    Foundry Square III (a land parcel that was under option),
    the Ferry Building, San Rafael Corporate Center I and
    San Rafael Corporate Center II (a land parcel). Wilson
    Investors acquired W/ EOs interest in a project known as
    Larkspur (a land parcel under option) and Wilson Investors
    acquired the operating business and all assets of W/ EO other
    than its ownership interests in the development projects known
    as Foundry Square IV and Concar. W/ EOs and our
    interests in Foundry Square IV and Concar remained
    unchanged as a result of this transaction. Joint ventures with
    other unaffiliated parties on the projects in which we acquired
    W/EOs interest also remain unchanged as a result of this
    transaction. This transaction was accounted for as a nonmonetary
    exchange because the assets included in the exchange were
    similar and because the cash consideration exchanged was
    minimal. No gain or loss was recognized in connection with the
    transaction. A Wilson Investors subsidiary continued to provide
    the development management services to Foundry Square II,
    the Ferry Building and Concar through project stabilization. In
    2004, the final project reached stabilization and accordingly,
    the subsidiary of Wilson Investors has ceased providing
    development management services. We also engaged a subsidiary of
    Wilson Investors to provide leasing brokerage services for
    Foundry Square II and the Ferry Building. These services
    for Foundry Square II were terminated by us and these
    services for the Ferry Building were terminated in part by us in
    January 2004.

96



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




|          |                                         
|--------- | ----------------------------------------
|NOTE 20  | RELATED PARTY TRANSACTIONS  (continued)



|    |  |                                                                                                                                                                                                                                                                                                 
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(b) |  | We lease office space from Two North Riverside Plaza Joint
    Venture, a partnership composed of trusts established for the
    benefit of the families of Samuel Zell and Robert Lurie, a
    deceased former business partner of Mr. Zell. The term of
    the lease expires on May 31, 2014.



| |                                      
| | -------------------------------------
| | Amounts Received from Related Parties









NOTE 21  SHARE-BASED EMPLOYEE COMPENSATION
PLANS








97



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




NOTE 21  SHARE-BASED EMPLOYEE COMPENSATION
PLANS  (continued)










|                                               |  |                    |          |  |      |  |          |      |  |  |          | 
|---------------------------------------------- |  | ------------------ | -------- |  | ---- |  | -------- | ---- |  |  | -------- | 
|                                               |  | Options Granted in |         
|                                               |  |                    |         
|Assumptions:                                   |  | 2004               |          |  | 2003 |  |          | 2002 | 
|                                               |  |                    |          |  |      |  |          |      | 
|Risk-free interest rate                        |  |                    | 3.6%     |  |      |  | 3.2%     |      |  |  | 4.2%     | 
|Expected dividend yield                        |  |                    | 7.0%     |  |      |  | 6.6%     |      |  |  | 7.0%     | 
|Volatility                                     |  |                    | 0.21     |  |      |  | 0.22     |      |  |  | 0.19     | 
|Weighted average expected life of the Options  |  |                    | 7  years |  |      |  | 7  years |      |  |  | 5  years | 
|Weighted average fair value of Options granted |  |                    | $2.18    |  |      |  | $2.36    |      |  |  | $2.29    | 





98



---



##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




NOTE 21  SHARE-BASED EMPLOYEE COMPENSATION
PLANS  (continued)




|                             |                   |                    |            |                  |                |   |       |       | 
|---------------------------- | ----------------- | ------------------ | ---------- | ---------------- | -------------- | - | ----- | ----- | 
|                             |                   |                    |            | Weighted Average |               
|                             |                   | Common Shares      |            |                  | Exercise Price |  
|                             |                   | Subject to Options |            |                  | Per Option     |  
|                             |                   |                    |            |                  |                |  
|Balance at December 31, 2001 |                   |                    | 16,286,353 |                  |                | $ | 26.41 |      
|                             | Options granted   |                    |            | 6,540,705        |                |   |       | 28.36 | 
|                             | Options canceled  |                    |            | (592,102         | )              |   |       | 28.98 | 
|                             | Options exercised |                    |            | (1,739,863       | )              |   |       | 23.00 | 
|                             |                   |                    |            |                  |                |  
|Balance at December 31, 2002 |                   |                    | 20,495,093 |                  |                |   | 27.18 |      
|                             | Options granted   |                    |            | 3,550,017        |                |   |       | 24.70 | 
|                             | Options canceled  |                    |            | (1,358,070       | )              |   |       | 27.78 | 
|                             | Options exercised |                    |            | (1,661,333       | )              |   |       | 22.72 | 
|                             |                   |                    |            |                  |                |  
|Balance at December 31, 2003 |                   |                    | 21,025,707 |                  |                |   | 27.10 |      
|                             | Options granted   |                    |            | 3,929,195        |                |   |       | 28.50 | 
|                             | Options canceled  |                    |            | (1,237,162       | )              |   |       | 28.42 | 
|                             | Options exercised |                    |            | (2,489,462       | )              |   |       | 23.81 | 
|                             |                   |                    |            |                  |                |  
|Balance at December 31, 2004 |                   |                    | 21,228,278 |                  |                | $ | 27.66 |      
|                             |                   |                    |            |                  |                |  



|                         |  |                     |            |                  |                     |  |           |                         |  |   |         |           |  |       |            |  |           |   |       |       |  |  |           |  |  |   |       | 
|------------------------ |  | ------------------- | ---------- | ---------------- | ------------------- |  | --------- | ----------------------- |  | - | ------- | --------- |  | ----- | ---------- |  | --------- | - | ----- | ----- |  |  | --------- |  |  | - | ----- | 
|                         |  | Options Outstanding |            |                  | Options Exercisable |  |           | Options Not Exercisable | 
|                         |  |                     |            |                  |                     |  |           |                         | 
|                         |  |                     |            | Weighted-        |                     |  |           |                         |  |   |        
|                         |  |                     |            | average          |                     |  | Weighted- |                         |  |   |         | Weighted- |  |       |            |  | Weighted- |  
|                         |  |                     |            | remaining        |                     |  | average   |                         |  |   |         | average   |  |       |            |  | average   |  
|                         |  |                     |            | contractual life |                     |  | exercise  |                         |  |   |         | exercise  |  |       |            |  | exercise  |  
|Range of Exercise Prices |  | Options             |            |                  | in years(a)         |  |           | price                   |  |   | Options |           |  | price |            |  | Options   |   |       | price | 
|                         |  |                     |            |                  |                     |  |           |                         |  |   |         |           |  |       |            |  |           |   |       |       | 
|$14.31 to $21.00         |  |                     | 684,512    |                  |                     |  | 2.6       |                         |  | $ | 20.87   |           |  |       | 684,512    |  |           | $ | 20.87 |       |  |  |          |  |  | $ |      | 
|$21.07 to $23.40         |  |                     | 425,723    |                  |                     |  | 3.9       |                         |  |   | 23.15   |           |  |       | 425,723    |  |           |   | 23.15 |       |  |  |          |  |  |   |      | 
|$24.23 to $24.62         |  |                     | 4,468,928  |                  |                     |  | 6.7       |                         |  |   | 24.40   |           |  |       | 2,827,356  |  |           |   | 24.32 |       |  |  | 1,641,572 |  |  |   | 24.53 | 
|$25.90 to $28.36         |  |                     | 5,733,720  |                  |                     |  | 6.9       |                         |  |   | 28.16   |           |  |       | 4,057,823  |  |           |   | 28.18 |       |  |  | 1,675,897 |  |  |   | 28.10 | 
|$28.54 to $29.50         |  |                     | 5,647,054  |                  |                     |  | 7.1       |                         |  |   | 28.89   |           |  |       | 2,081,639  |  |           |   | 29.48 |       |  |  | 3,565,415 |  |  |   | 28.54 | 
|$29.76 to $33.00         |  |                     | 4,268,341  |                  |                     |  | 5.6       |                         |  |   | 30.34   |           |  |       | 4,265,566  |  |           |   | 30.34 |       |  |  | 2,775     |  |  |   | 29.93 | 
|                         |  |                     |            |                  |                     |  |           |                         |  |   |         |           |  |       |            |  |           |   |       |       | 
|$14.31 to $33.00         |  |                     | 21,228,278 |                  |                     |  | 6.4       |                         |  | $ | 27.66   |           |  |       | 14,342,619 |  |           | $ | 27.75 |       |  |  | 6,885,659 |  |  | $ | 27.48 | 
|                         |  |                     |            |                  |                     |  |           |                         |  |   |         |           |  |       |            |  |           |   |       |       | 






|    |                                                            
|--- | -----------------------------------------------------------
|(a) | Expiration dates ranged from January 2005 to December 2014.

Restricted Shares




Non-Qualified Purchase Plan




99



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




NOTE 21  SHARE-BASED EMPLOYEE COMPENSATION
PLANS  (continued)




NOTE 22  401(K) PLAN




NOTE 23  COMMITMENTS AND CONTINGENCIES


Concentration of Credit Risk




Environmental




Litigation




100



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




NOTE 23  COMMITMENTS AND
CONTINGENCIES  (continued)


Contingencies




Accounting for Contingencies,




101



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




NOTE 23  COMMITMENTS AND
CONTINGENCIES  (continued)


Insurance


Property Damage, Business Interruption, Earthquake and
Terrorism:


|                         |  |                                                                                                                                                                                                  |  |                                          
|------------------------ |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | -----------------------------------------
|Type of Insurance        |  |                                                                                                                                                                                                  |  | Third-Party Coverage                     
|Coverage                 |  | Equity Office Loss Exposure/Deductible                                                                                                                                                           |  | Limitation                               
|                         |  |                                                                                                                                                                                                  |  |                                          
|Property damage and      |  |                                                                                                                                                                                                  |  |                                          
|business interruption(a) |  | $50 million per occurrence and $75 million annual
    aggregate exposure (which includes amounts paid for earthquake
    loss), plus $1 million per occurrence deductible                        |  | $1.0 billion per occurrence(c)           
|Earthquake(a)(b)         |  | $75 million per occurrence and annual aggregate exposure
    (which includes amounts paid for property damage and business
    interruption loss), plus $1 million per occurrence
    deductible |  | $325 million in the aggregate per year(c)
|Acts of terrorism(d)     |  | $2.8 million per occurrence deductible (plus 10% of each
    and every loss with a maximum per occurrence exposure of
    $35.3 million which includes the $2.8 million
    deductible)          |  | $825 million per occurrence(e)           






|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | We retain up to $75 million annual aggregate of such loss
    throughout the portfolio. In the event of a loss in excess of
    this retention limit, the third-party insurance carriers would
    be obligated to cover the losses up to the stated coverage
    amounts in the above table.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   
|(b) |  | The amount of the third party insurance relating to earthquakes
    is based on maximum probable loss studies performed by
    independent third parties. The maximum annual aggregate payment
    amount for earthquake loss is $325 million, inclusive of
    our loss exposure of $75 million plus $1 million per
    occurrence deductible. There can be no assurance that the
    maximum probable loss studies have accurately estimated losses
    that may occur.                                                                                                                                                                                                                                                                                                                                                                    
|   
|(c) |  | These amounts include our loss exposure/deductible amount.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   
|(d) |  | The coverage includes nuclear, chemical and biological events.
    The coverage does not apply to non-TRIA (Terrorism Insurance Act
    of 2002) events (which are terrorism events that are not
    committed by a foreigner or a foreign country). We maintain
    separate insurance with a $325 million annual aggregate
    limit subject to a deductible of $1 million for non-TRIA
    events. This separate coverage for non-TRIA events excludes
    nuclear, biological and chemical events. The Terrorism Insurance
    Act of 2002 will expire December 31, 2005 and there is a
    risk it will not be extended past this date. Should the act not
    be extended, the structure, terms or conditions (including
    premiums and coverage) of our terrorism insurance program would
    likely be affected for future periods.
|   
|(e) |  | This amount is in excess of our deductible amounts.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

Pollution:


102



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NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




NOTE 23  COMMITMENTS AND
CONTINGENCIES  (continued)


Workers Compensation, Automobile Liability and General
Liability:


NOTE 24  SUBSEQUENT EVENTS






| |    |                                                                                                                                                                                                                         
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 1. | We acquired Summit at Douglas Ridge Phase I, which consists
    of one office building comprising approximately
    92,941 square feet in Roseville, California for a purchase
    price of approximately $25.0 million.
|
| | 2. | We disposed of the following properties:                                                                                                                                                                                

|                                                                                                                                                 |  |                           |  |             |    |  |             |  |           |                        |  |   |         | 
|------------------------------------------------------------------------------------------------------------------------------------------------ |  | ------------------------- |  | ----------- | -- |  | ----------- |  | --------- | ---------------------- |  | - | ------- | 
|                                                                                                                                                 |  |                           |  | Number of   |    |  |             |  |          
|                                                                                                                                                 |  |                           |  | Buildings   |    |  | Square Feet |  |           | Sales Price            | 
|Property                                                                                                                                         |  | Location                  |  | (Unaudited) |    |  | (Unaudited) |  |           | (Dollars in thousands) | 
|                                                                                                                                                 |  |                           |  |             |    |  |             |  |           |                        | 
|Northland Plaza(a)                                                                                                                               |  | Bloomington, MN           |  |             | 1  |  |             |  | 296,967   |                        |  | $ | 43,000  | 
|Meier Central North  Buildings 13 and 14                                                                                                        |  | Santa Clara, CA           |  |             | 2  |  |             |  | 29,200    |                        |  |   | 1,986   | 
|Waters Edge(b)                                                                                                                                  |  | Playa Vista, CA           |  |             | 2  |  |             |  | 243,433   |                        |  |   | 85,500  | 
|One Devon Square, Two Devon Square and Three Devon Square                                                                                        |  | Wayne, PA                 |  |             | 3  |  |             |  | 142,493   |                        |  |   | 23,000  | 
|Meier Central South  Building 12                                                                                                                |  | Santa Clara, CA           |  |             | 1  |  |             |  | 31,500    |                        |  |   | 2,867   | 
|One Valley Square, Two Valley Square, Three Valley Square, Four
    and Five Valley Square, Oak Hill Plaza, Walnut Hill Plaza and
    Four Falls |  | Suburban Philadelphia, PA |  |             | 8  |  |             |  | 863,124   |                        |  |   | 136,000 | 
|                                                                                                                                                 |  |                           |  |             |    |  |             |  |           |                        | 
|                                                                                                                                                 |  | Total                     |  |             | 17 |  |             |  | 1,606,717 |                        |  | $ | 292,353 | 
|                                                                                                                                                 |  |                           |  |             |    |  |             |  |           |                        | 






| |     |                                                                                                                                                                                                       
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) | This property was classified as held for sale at
    December 31, 2004 and written down to its estimated fair
    value less costs to sell, which approximated the fair value at
    the time of sale.





| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 3. | We repaid $125 million of 6.88% unsecured notes and
    $400 million of 6.63% unsecured notes that matured in
    February 2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| | 4. | We repaid the mortgage debt that encumbered the Island Corporate
    Center and San Mateo Bay Center II office properties
    for a total of approximately $21.8 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| | 5. | We obtained a $250 million unsecured term loan facility,
    which bears interest at LIBOR plus 35 basis points (the
    spread is subject to change based on our credit rating) and
    matures in February 2006. Amounts borrowed under this facility
    are required to be repaid with net proceeds from the issuance of
    unsecured notes, and at our option, with certain proceeds from
    future asset sales. We have the option through August 2005 to
    increase the facility up to $600 million. Upon exercise of
    the option, the interest rate will increase to 65 basis
    points (this spread is subject to change based on our credit
    rating). This term loan facility is subject to the same
    financial covenants as our existing $1 billion line of
    credit.

103



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (continued)




NOTE 24  SUBSEQUENT
EVENTS  (continued)




| |    |                                                                                                                                                                                                                                                                                                                                                                                                             
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 6. | Effective January 4, 2005, we signed an amendment to a
    lease that reduced a tenants space at 1301 Avenue of the
    Americas, New York, NY, from approximately 564,000 square
    feet to approximately 250,000 square feet. In connection
    with this agreement, we recognized a lease termination fee of
    approximately $44.4 million, net of outstanding deferred
    rent receivable balances.

104



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##### Table of Contents








|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|Item 9. | Changes in and Disagreements With Accountants on Accounting
    and Financial Disclosure.








|         |                         
|-------- | ------------------------
|Item 9A. | Controls and Procedures.

Evaluation of Disclosure Controls and Procedures




Managements Report on Internal Control over Financial
Reporting






Changes in Internal Control over Financial Reporting









|         |                   
|-------- | ------------------
|Item 9B. | Other Information.



105



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##### Table of Contents






PART III







|         |                                                    
|-------- | ---------------------------------------------------
|Item 10. | Directors and Executive Officers of the Registrant.












|         |                        
|-------- | -----------------------
|Item 11. | Executive Compensation.








|         |                                                                                                    
|-------- | ---------------------------------------------------------------------------------------------------
|Item 12. | Security Ownership of Certain Beneficial Owners and
    Management and Related Stockholder Matters.








|         |                                                
|-------- | -----------------------------------------------
|Item 13. | Certain Relationships and Related Transactions.








|         |                                        
|-------- | ---------------------------------------
|Item 14. | Principal Accountant Fees and Services.



106



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##### Table of Contents






PART IV







|         |                                            
|-------- | -------------------------------------------
|Item 15. | Exhibits and Financial Statement Schedules.







| |                                                             
| | ------------------------------------------------------------
| | Consolidated Balance Sheets as of December 31, 2004 and 2003



| |                                                                                                                    
| | -------------------------------------------------------------------------------------------------------------------
| | Consolidated Statements of Operations for the years ended
    December 31, 2004, 2003 and 2002                     
|
| | Consolidated Statements of Changes in Shareholders Equity
    for the years ended December 31, 2004, 2003 and 2002
|
| | Consolidated Statements of Net Comprehensive Income for the
    years ended December 31, 2004, 2003 and 2002       
|
| | Consolidated Statements of Cash Flows for the years ended
    December 31, 2004, 2003 and 2002                     













| |                                                                                           
| | ------------------------------------------------------------------------------------------
| | The exhibits required by this item are set forth on the
    Exhibit Index attached hereto.





| |                         
| | ------------------------
| | See Item 15(a)(3) above.





107



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##### Table of Contents



SIGNATURES






| |                                   
| | ----------------------------------
| | Equity Office Properties
    Trust



| |     |                           
| | --- | --------------------------
| | By: | /s/ Richard D.
    Kincaid

| |                                      
| | -------------------------------------
| |                                      
| | Richard D. Kincaid                   
| | President and Chief Executive Officer
|
| | Date: March 16, 2005                 



| |                                                                                                                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Pursuant to the requirements of the Securities Exchange Act of
    1934, this report has been signed below by the following persons
    on behalf of the registrant in the capacities indicated as of
    March 16, 2005.

|                                                       |  |                                                                                        |  | 
|------------------------------------------------------ |  | -------------------------------------------------------------------------------------- |  | 
|Signature                                              |  | Title                                                                                 
|                                                       |  |                                                                                       
|                                                      
|/s/ Richard D. KincaidRichard
    D. Kincaid           |  | President, Chief Executive Officer and Trustee
    (principal executive officer)      
|                                                      
|/s/ Marsha C. WilliamsMarsha
    C. Williams           |  | Executive Vice President and Chief Financial Officer (principal
    financial officer)
|                                                      
|/s/ Virginia L.
    SeggermanVirginia
    L. Seggerman |  | Senior Vice President and Chief Accounting Officer (principal
    accounting officer) 
|                                                      
|/s/ Samuel ZellSamuel
    Zell                         |  | Chairman of the Board of Trustees                                                     
|                                                      
|/s/ Marilyn A.
    AlexanderMarilyn
    A. Alexander   |  | Trustee                                                                               
|                                                      
|/s/ Thomas E. DobrowskiThomas
    E. Dobrowski         |  | Trustee                                                                               
|                                                      
|/s/ William M. GoodyearWilliam
    M. Goodyear         |  | Trustee                                                                               
|                                                      
|/s/ James D. Harper,
    Jr.James
    D. Harper, Jr.   |  | Trustee                                                                               
|                                                      
|/s/ David K. McKownDavid
    K. McKown                 |  | Trustee                                                                               
|                                                      
|/s/ Sheli Z. RosenbergSheli
    Z. Rosenberg           |  | Trustee                                                                               

108



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|                                                             |  |         |  | 
|------------------------------------------------------------ |  | ------- |  | 
|Signature                                                    |  | Title  
|                                                             |  |        
|                                                            
|Stephen
    I. Sadove                                        |  | Trustee
|                                                            
|Edwin
    N. Sidman                                          |  | Trustee
|                                                            
|Sally
    Susman                                             |  | Trustee
|                                                            
|/s/ Jan H.W.R. van der
    VlistJan
    H.W.R. van der Vlist |  | Trustee

109



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##### Table of Contents



EXHIBIT INDEX


|            |     |  |             |                                                                                                                                                                                                                                                                                                               |          |                                                                                                              
|----------- | --- |  | ----------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | -------------------------------------------------------------------------------------------------------------
|Exhibit No. |     |  | Description |                                                                                                                                                                                                                                                                                                               | Location
|            |     |  |             |                                                                                                                                                                                                                                                                                                               |         
|            | 3.1 |  |             | Restated Declaration of Trust                                                                                                                                                                                                                                                                                 |          | Incorporated by reference to Exhibit 3.2 to Equity
    Offices 2003 Third Quarter Form 10-Q                 
|           
|            | 3.2 |  |             | Third Amended and Restated Bylaws                                                                                                                                                                                                                                                                             |          | Incorporated by reference to Exhibit 3.1 to Equity
    Offices 2003 First Quarter Form 10-Q                 
|           
|            | 4.1 |  |             | Indenture, dated as of September 2, 1997, between EOP
    Partnership and State Street Bank and Trust Company                                                                                                                                                                                                 |          | Incorporated by reference to Exhibit 4.1 to Equity
    Offices 1997 Annual Report on Form 10-K, as amended  
|           
|            | 4.2 |  |             | First Supplemental Indenture, dated as of February  9,
    1998, between EOP Partnership and State Street Bank and
    Trust Company                                                                                                                                                                          |          | Incorporated by reference to Exhibit 4.2 to Equity
    Offices 1997 Annual Report on Form 10-K, as amended  
|           
|            | 4.3 |  |             | $200,000,000 6.625% Note due 2005. Another $200,000,000
    6.625% Note due 2005, identical in all material respects to
    the Note filed as Exhibit 4.4 to Equity Offices 1997
    Annual Report on Form  10-K, as amended, has not been
    filed                                                         |          | Incorporated by reference to Exhibit 4.4 to Equity
    Offices 1997 Annual Report on Form 10-K, as amended  
|           
|            | 4.4 |  |             | $200,000,000 6.750% Note due 2008. A $100,000,000
    6.750% Note due 2008, identical in all material respects
    other than principal amount to the Note filed as
    Exhibit 4.5 to Equity Offices 1997 Annual Report on
    Form 10-K, as amended, has not been filed                                    |          | Incorporated by reference to Exhibit 4.5 to Equity
    Offices 1997 Annual Report on Form 10-K, as amended  
|           
|            | 4.5 |  |             | $200,000,000 7.250% Note due 2018. A $50,000,000
    7.250% Note due 2018, identical in all material respects
    other than principal amount to the Note filed as
    Exhibit 4.6 to Equity Offices Annual Report on
    Form 10-K for the year ended December 31, 1997, as
    amended, has not been filed |          | Incorporated by reference to Exhibit 4.6 to Equity
    Offices 1997 Annual Report on Form 10-K, as amended  
|           
|            | 4.6 |  |             | $30,000,000 7.24% Senior Note due 2004                                                                                                                                                                                                                                                                        |          | Incorporated by reference to Exhibit 4.8 to Equity
    Offices 1997 Annual Report on Form 10-K, as amended  
|           
|            | 4.7 |  |             | $50,000,000 7.36% Senior Note due 2005                                                                                                                                                                                                                                                                        |          | Incorporated by reference to Exhibit 4.9 to Equity
    Offices 1997 Annual Report on Form 10-K, as amended  
|           
|            | 4.8 |  |             | $50,000,000 7.44% Senior Note due 2006                                                                                                                                                                                                                                                                        |          | Incorporated by reference to Exhibit 4.10 to Equity
    Offices 1997 Annual Report on Form 10-K, as amended 
|           
|            | 4.9 |  |             | $50,000,000 7.41% Senior Note due 2007                                                                                                                                                                                                                                                                        |          | Incorporated by reference to Exhibit 4.11 to Equity
    Offices 1997 Annual Report on Form 10-K, as amended)



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##### Table of Contents



|            |      |  |             |                                                                                                                                                                      |          |                                                                                                                                              
|----------- | ---- |  | ----------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | ---------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |      |  | Description |                                                                                                                                                                      | Location
|            |      |  |             |                                                                                                                                                                      |         
|           
|            | 4.10 |  |             | $250,000,000 6.50% Notes due 2004                                                                                                                                    |          | Incorporated by reference to Exhibit 4.12 to Equity
    Offices 2000 Annual Report on Form 10-K, as amended                                 
|           
|            | 4.11 |  |             | $300,000,000 6.763% Notes due 2007                                                                                                                                   |          | Incorporated by reference to Exhibit 4.13 to Equity
    Offices 2000 Annual Report on Form 10-K, as amended                                 
|           
|            | 4.12 |  |             | $225,000,000 7.25% Notes due 2028                                                                                                                                    |          | Incorporated by reference to Exhibit 4.14 to Equity
    Offices 2000 Annual Report on Form 10-K, as amended                                 
|           
|            | 4.13 |  |             | $300,000,000 6.5% Notes due 2004                                                                                                                                     |          | Incorporated by reference to Exhibit 4.16 to Equity
    Offices 2000 Annual Report on Form 10-K, as amended                                 
|           
|            | 4.14 |  |             | $500,000,000 6.8% Notes due 2009                                                                                                                                     |          | Incorporated by reference to Exhibit 4.17 to Equity
    Offices 2000 Annual Report on Form 10-K, as amended                                 
|           
|            | 4.15 |  |             | $200,000,000 7.5% Notes due April 19, 2029                                                                                                                           |          | Incorporated by reference to Exhibit 4.23 to EOP
    Partnerships Current Report on Form 8-K filed with
    the SEC on April 19, 1999       
|           
|            | 4.16 |  |             | $400,000,000 8.375% Note due March 15, 2006                                                                                                                          |          | Incorporated by reference to Exhibit 4.24 to EOP
    Partnerships Current Report on Form 8-K filed with
    the SEC on March 24, 2000       
|           
|            | 4.17 |  |             | $100,000,000 8.375% Note due March 15, 2006                                                                                                                          |          | Incorporated by reference to Exhibit 4.25 to EOP
    Partnerships Current Report on Form 8-K filed with
    the SEC on March 24, 2000       
|           
|            | 4.18 |  |             | $360,000,000 8.10% Note due August 1, 2010 of EOP
    Partnership                                                                                                    |          | Incorporated by reference to Exhibit 4.1 to EOP
    Partnerships Current Report on Form 8-K filed with
    the SEC on August 8, 2000        
|           
|            | 4.19 |  |             | Indenture, dated August 23, 2000, by and among EOP
    Partnership, Equity Office and State Street Bank and
    Trust Company                                        |          | Incorporated by reference to Exhibit 4.1 to Equity
    Offices Registration Statement on Form S-3 (SEC File
    No. 333-47754)              
|           
|            | 4.20 |  |             | $300,000,000 (or applicable lesser amount) Senior Exchangeable
    Note due November 15, 2008, and related Guarantee                                                 |          | Incorporated by reference to Exhibit 4.23 to Equity
    Offices 2001 Annual Report on Form 10-K, as amended                                 
|           
|            | 4.21 |  |             | $25,000,000 (or applicable lesser amount) Senior Exchangeable
    Note due November 15, 2008, and related Guarantee                                                  |          | Incorporated by reference to Exhibit 4.24 to Equity
    Offices 2001 Annual Report on Form 10-K, as amended                                 
|           
|            | 4.22 |  |             | $325,000,000 (or applicable lesser amount) Senior Exchangeable
    Notes due November 15, 2008, and related Guarantee                                                |          | Incorporated by reference to Exhibit 4.25 to Equity
    Offices 2001 Annual Report on Form 10-K, as amended                                 
|           
|            | 4.23 |  |             | Indenture, dated August 29, 2000, by and between EOP
    Partnership and U.S. Bank National Association (formerly
    known as U.S. Bank Trust National Association) |          | Incorporated by reference to Exhibit 4.1 to EOP
    Partnerships Registration Statement on Form S-3, as
    amended (SEC File No. 333-43530)



---



##### Table of Contents



|            |      |  |             |                                                                                                                                                                                                 |          |                                                                                                                                            
|----------- | ---- |  | ----------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | -------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |      |  | Description |                                                                                                                                                                                                 | Location
|            |      |  |             |                                                                                                                                                                                                 |         
|           
|            | 4.24 |  |             | First Supplemental Indenture, dated June 18, 2001, among
    EOP Partnership, Equity Office and U.S. Bank National
    Association (formerly known as U.S. Bank
    Trust National Association) |          | Incorporated by reference to Exhibit 4.2 to Equity
    Offices Registration Statement on Form S-3, as
    amended (SEC File No. 333-58976)
|           
|            | 4.25 |  |             | $400,000,000
    73/4% Note
    due 2007                                                                                                                                                        |          | Incorporated by reference to Exhibit 4.5 to EOP
    Partnerships Current Report on Form 8-K filed with
    the SEC on November 20, 2000   
|           
|            | 4.26 |  |             | $200,000,000
    73/4% Note
    due 2007                                                                                                                                                        |          | Incorporated by reference to Exhibit 4.6 to EOP
    Partnerships Current Report on Form 8-K filed with
    the SEC on November 20, 2000   
|           
|            | 4.27 |  |             | $500,000,000 7.000% Note due July 15, 2011, and
    related Guarantee                                                                                                                           |          | Incorporated by reference to Exhibit 4.4 to EOP
    Partnerships Current Report on Form 8-K filed with
    the SEC on July 18, 2001       
|            | 4.28 |  |             | $500,000,000 7.000% Note due July 15, 2011, and
    related Guarantee                                                                                                                           |          | Incorporated by reference to Exhibit 4.5 to EOP
    Partnerships Current Report on Form 8-K filed with
    the SEC on July 18, 2001       
|           
|            | 4.29 |  |             | $100,000,000 7.000% Note due July 15, 2011, and
    related Guarantee                                                                                                                           |          | Incorporated by reference to Exhibit 4.6 to EOP
    Partnerships Current Report on Form 8-K filed with
    the SEC on July 18, 2001       
|           
|            | 4.30 |  |             | $300,000,000 7.875% Note due July 15, 2031, and
    related Guarantee                                                                                                                           |          | Incorporated by reference to Exhibit 4.7 to EOP
    Partnerships Current Report on Form 8-K filed with
    the SEC on July 18, 2001       
|           
|            | 4.31 |  |             | $400,000,000
    63/4% Note
    due February 15, 2012, and related Guarantee                                                                                                                    |          | Incorporated by reference to Exhibit 4.1 to EOP
    Partnerships Current Report on Form 8-K filed with
    the SEC on February 15, 2002   
|           
|            | 4.32 |  |             | $100,000,000
    63/4% Note
    due February 15, 2012, and related Guarantee                                                                                                                    |          | Incorporated by reference to Exhibit 4.2 to EOP
    Partnerships Current Report on Form 8-K filed with
    the SEC on February 15, 2002   
|           
|            | 4.33 |  |             | Indenture, dated as of December 6, 1995, among Spieker and
    State Street Bank and Trust, as Trustee                                                                                          |          | Incorporated by reference to Exhibit 99.17.1 to Equity
    Offices Current Report on Form 8-K filed with the SEC
    on July 5, 2001      
|           
|            | 4.34 |  |             | Fourth Supplemental Indenture, dated as of
    January  24, 1996, among Spieker, Spieker Partnership
    and State Street                                                                       |          | Incorporated by reference to Exhibit 99.17.7 to Equity
    Offices Current Report on Form 8-K filed with the SEC
    on July 5, 2001      
|           
|            | 4.35 |  |             | $100,000,000 6.90% Note due January 15, 2004                                                                                                                                                    |          | Incorporated by reference to Exhibit 99.17.8 to Equity
    Offices Current Report on Form 8-K filed with the SEC
    on July 5, 2001      



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##### Table of Contents



|            |      |  |             |                                                                                                                                                                            |          |                                                                                                                                       
|----------- | ---- |  | ----------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |      |  | Description |                                                                                                                                                                            | Location
|            |      |  |             |                                                                                                                                                                            |         
|           
|            | 4.36 |  |             | Fifth Supplemental Indenture, dated as of June 20, 1996,
    among Spieker, Spieker Partnership and State Street                                                           |          | Incorporated by reference to Exhibit 99.17.9 to Equity
    Offices Current Report on Form 8-K filed with the SEC
    on July 5, 2001 
|           
|            | 4.37 |  |             | $100,000,000 Medium-Term Notes due nine months or more from
    July 19, 1996                                                                                              |          | Incorporated by reference to Exhibit 99.17.10 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.38 |  |             | Sixth Supplemental Indenture, dated as of
    December  10, 1996, among Spieker, Spieker Partnership
    and State Street                                                  |          | Incorporated by reference to Exhibit 99.17.12 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.39 |  |             | $100,000,000 7.125% Note due December 1, 2006                                                                                                                              |          | Incorporated by reference to Exhibit 99.17.13 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.40 |  |             | Seventh Supplemental Indenture, dated as of December 10,
    1996, among Spieker, Spieker Partnership and State Street                                                     |          | Incorporated by reference to Exhibit 99.17.14 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.41 |  |             | $25,000,000 7.875% Note due December 1, 2016                                                                                                                               |          | Incorporated by reference to Exhibit 99.17.15 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.42 |  |             | Eighth Supplemental Indenture, dated as of July  14,
    1997, among Spieker, Spieker Partnership and State Street                                                         |          | Incorporated by reference to Exhibit 99.17.16 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.43 |  |             | $150,000,000 7.125% Note due July 1, 2009                                                                                                                                  |          | Incorporated by reference to Exhibit 99.17.17 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.44 |  |             | Ninth Supplemental Indenture, dated as of September 29,
    1997, among Spieker, Spieker Partnership, First Trust of
    California, National Association and State Street |          | Incorporated by reference to Exhibit 99.17.18 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.45 |  |             | $150,000,000 7.50% Debenture due October 1, 2027                                                                                                                           |          | Incorporated by reference to Exhibit 99.17.19 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.46 |  |             | Tenth Supplemental Indenture, dated as of December  8,
    1997, among Spieker, Spieker Partnership and First Trust of
    California, National Association                |          | Incorporated by reference to Exhibit 99.17.20 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.47 |  |             | $200,000,000 7.35% Debenture due December 1, 2017                                                                                                                          |          | Incorporated by reference to Exhibit 99.17.21 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001



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##### Table of Contents



|            |      |  |             |                                                                                                                                                                                                           |          |                                                                                                                                       
|----------- | ---- |  | ----------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |      |  | Description |                                                                                                                                                                                                           | Location
|            |      |  |             |                                                                                                                                                                                                           |         
|           
|            | 4.48 |  |             | Eleventh Supplemental Indenture, dated as of January 27,
    1998, among Spieker, Spieker Partnership and First Trust of
    California, National Association                                             |          | Incorporated by reference to Exhibit 99.17.22 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.49 |  |             | $150,000,000 6.75% Note due January 15, 2008                                                                                                                                                              |          | Incorporated by reference to Exhibit 99.17.23 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.50 |  |             | Twelfth Supplemental Indenture, dated as of February 2,
    1998, among Spieker, Spieker Partnership and First Trust of
    California, National Association                                              |          | Incorporated by reference to Exhibit 99.17.24 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.51 |  |             | $125,000,000 6.875% Note due February 1, 2005                                                                                                                                                             |          | Incorporated by reference to Exhibit 99.17.25 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.52 |  |             | Thirteenth Supplemental Indenture, dated as of February 2,
    1998, among Spieker, Spieker Partnership and First Trust of
    California, National Association                                           |          | Incorporated by reference to Exhibit 99.17.26 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.53 |  |             | $1,500,000 7.0% Note due February 1, 2007                                                                                                                                                                 |          | Incorporated by reference to Exhibit 99.17.27 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.54 |  |             | Fourteenth Supplemental Indenture, dated as of April 29,
    1998, among Spieker, Spieker Partnership and U.S. Bank
    National Association (formerly known as U.S. Bank
    Trust National Association) |          | Incorporated by reference to Exhibit 99.17.28 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.55 |  |             | $25,000,000 6.88% Note due April 30, 2007                                                                                                                                                                 |          | Incorporated by reference to Exhibit 99.17.29 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.56 |  |             | Fifteenth Supplemental Indenture, dated as of May  11,
    1999, among Spieker, Spieker Partnership and U.S. Bank
    National Association (formerly known as U.S. Bank
    Trust National Association)   |          | Incorporated by reference to Exhibit 99.17.30 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.57 |  |             | $200,000,000 6.8% Note due May 1, 2004                                                                                                                                                                    |          | Incorporated by reference to Exhibit 99.17.31 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001
|           
|            | 4.58 |  |             | $200,000,000 7.25% Note due May 1, 2009                                                                                                                                                                   |          | Incorporated by reference to Exhibit 99.17.32 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001



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##### Table of Contents



|            |      |  |             |                                                                                                                                                                                                                                                                                                                                                                                                                   |          |                                                                                                                                             
|----------- | ---- |  | ----------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |      |  | Description |                                                                                                                                                                                                                                                                                                                                                                                                                   | Location
|            |      |  |             |                                                                                                                                                                                                                                                                                                                                                                                                                   |         
|           
|            | 4.59 |  |             | Sixteenth Supplemental Indenture, dated as of December 11,
    2000, among Spieker, Spieker Partnership and U.S. Bank
    National Association (formerly known as U.S. Bank
    Trust National Association)                                                                                                                                                                                                       |          | Incorporated by reference to Exhibit 99.17.33 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001      
|           
|            | 4.60 |  |             | $200,000,000 7.65% Note due December 15, 2010                                                                                                                                                                                                                                                                                                                                                                     |          | Incorporated by reference to Exhibit 99.17.34 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001      
|           
|            | 4.61 |  |             | Seventeenth Supplemental Indenture relating to the substitution
    of Equity Office and EOP Partnership as successor entities for
    Spieker and Spieker Partnership, respectively                                                                                                                                                                                                                              |          | Incorporated by reference to Exhibit 99.17.35 to Equity
    Offices Current Report on Form 8-K filed with the SEC on
    July 5, 2001      
|           
|            | 4.62 |  |             | $400,000,000 5.875% Note due January 15, 2013, and
    related Guarantee                                                                                                                                                                                                                                                                                                                                          |          | Incorporated by reference to Exhibit 4.1 to the Current
    Report on Form 8-K of EOP Partnership filed with the SEC on
    January 15, 2003
|           
|            | 4.63 |  |             | $100,000,000 5.875% Note due January 15, 2013, and
    related Guarantee                                                                                                                                                                                                                                                                                                                                          |          | Incorporated by reference to Exhibit 4.2 to the Current
    Report on Form 8-K of EOP Partnership filed with the SEC on
    January 15, 2003
|           
|            | 4.64 |  |             | $500,000,000 4.75% Note due March 15, 2014 and related
    Guarantee (another $500,000,000 4.75% Note due
    March 15, 2014 and related Guarantee, identical in all
    material respects to the Note filed as Exhibit 4.3 to the
    Current Report on Form  8-K of EOP Partnership filed
    with the SEC on March  26, 2004, has not been filed)                                                              |          | Incorporated by reference to Exhibit 4.3 to the Current
    Report on Form 8-K of EOP Partnership filed with the SEC on
    March 26, 2004  
|           
|            | 4.65 |  |             | $45,000,000 Floating Rate Note due May 27, 2014 and related
    Guarantee                                                                                                                                                                                                                                                                                                                                         |          | Incorporated by reference to Exhibit 4.3 to the Current
    Report on Form 8-K of EOP Partnership filed with the SEC on
    May 26, 2004    
|           
|            | 4.66 |  |             | $500,000,000 4.65% Fixed Rate Note due October 1, 2010 and
    related Guarantee (another $300,000,000 4.65% Fixed Rate Note
    due October 1, 2010 and related Guarantee, identical in all
    material respects, other than the principal amount, to the Note
    filed as Exhibit 4.3 to the Current Report on Form 8-K
    of EOP Partnership filed with the SEC on October 7, 2004,
    has not been filed) |          | Incorporated by reference to Exhibit 4.3 to the Current
    Report on Form 8-K of EOP Partnership filed with the SEC on
    October 7, 2004 
|            | 4.67 |  |             | $200,000,000 Floating Rate Note due October 1, 2010 and
    related Guarantee                                                                                                                                                                                                                                                                                                                                     |          | Incorporated by reference to Exhibit 4.4 to the Current
    Report on Form 8-K of EOP Partnership filed with the SEC on
    October 7, 2004 



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##### Table of Contents



|            |      |  |             |                                                                                                                                    |          |                                                                                                                                          
|----------- | ---- |  | ----------- | ---------------------------------------------------------------------------------------------------------------------------------- | -------- | -----------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |      |  | Description |                                                                                                                                    | Location
|            |      |  |             |                                                                                                                                    |         
|           
|            | 4.68 |  |             | Form of Medium-Term InterNote (Fixed Rate) and related Guarantee                                                                   |          | Incorporated by reference to Exhibit 4.3 to the Current
    Report on Form 8-K of EOP Partnership filed with the SEC on
    June 15, 2004
|           
|            | 4.69 |  |             | Form of Medium-Term InterNote (Floating Rate) and related
    Guarantee                                                            |          | Incorporated by reference to Exhibit 4.4 to the Current
    Report on Form 8-K of EOP Partnership filed with the SEC on
    June 15, 2004
|           
|            | 4.70 |  |             | New Trustee Appointment Agreement, dated June 10, 2004,
    among EOP Partnership, Equity Office and BNY Midwest
    Trust Company |          | Incorporated by reference to Exhibit 4.5 to the Current
    Report on Form 8-K of EOP Partnership filed with the SEC on
    June 15, 2004
|           
|            | 4.71 |  |             | Schedule of Medium-Term InterNotes (Fixed Rate) issued as of
    June 30, 2004                                                     |          | Incorporated by reference to Exhibit 4.5 to EOP
    Partnerships 2004 Second Quarter 10-Q                                               
|           
|            | 4.72 |  |             | Schedule of Medium-Term InterNotes (Fixed Rate) issued from
    July 1, 2004 to September 30, 2004                                 |          | Incorporated by reference to Exhibit 4.6 to EOP
    Partnerships 2004 Third Quarter 10-Q                                                
|           
|            | 4.73 |  |             | Schedule of Medium-Term InterNotes (Fixed Rate) issued from
    October 1, 2004 to December 31, 2004                               |          | Incorporated by reference to Exhibit 4.73 to EOP
    Partnerships 2004 Form 10-K                                                        
|           
|            | 10.1 |  |             | Third Amended and Restated Agreement of Limited Partnership of
    EOP Partnership                                                 |          | Incorporated by reference to Exhibit 99.8 to Equity
    Offices Current Report on Form 8-K filed with the SEC
    on July 5, 2001       
|           
|            | 10.2 |  |             | First Amendment to Third Amended and Restated Agreement of
    Limited Partnership of EOP Partnership                              |          | Incorporated by reference to Exhibit 4.1 to EOP
    Partnerships 2002 Third Quarter Form 10-Q                                           
|           
|            | 10.3 |  |             | Second Amendment to the Third Amended and Restated Agreement of
    Limited Partnership of EOP Partnership                         |          | Incorporated by reference to Exhibit 10.1 to Equity
    Offices 2003 Second Quarter Form 10-Q                                           
|           
|            | 10.4 |  |             | Third Amendment to the Third Amended and Restated Agreement of
    Limited Partnership of EOP Partnership                          |          | Incorporated by reference to Exhibit 10.4 to Equity
    Offices 2004 Annual Report on Form 10-K                                         
|           
|            | 10.5 |  |             | Fourth Amendment to the Third Amended and Restated Agreement of
    Limited Partnership of EOP Partnership                         |          | Incorporated by reference to Exhibit 3.1 to EOP
    Partnerships 2004 Second Quarter Form 10-Q                                          
|           
|            | 10.6 |  |             | Registration Rights Agreement, dated as of July  11,
    1997                                                                      |          | Incorporated by reference to Exhibit 10.2 to Equity
    Offices 1997 Annual Report on Form 10-K, as amended                             
|           
|            | 10.7 |  |             | Noncompetition Agreement between Equity Office and Samuel Zell                                                                     |          | Incorporated by reference to Exhibit 10.3 to Equity
    Offices 1997 Annual Report on Form 10-K, as amended                             
|           
|            | 10.8 |  |             | Amended and Restated Operating Agreement No. 1 of Wilson/
    Equity Office, LLC                                                   |          | Incorporated by reference to Exhibit 10.13 to Equity
    Offices 2000 Annual Report on Form 10-K, as amended                            



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##### Table of Contents



|            |        |  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                          |          |                                                                                                                                         
|----------- | ------ |  | ----------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | ----------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |        |  | Description |                                                                                                                                                                                                                                                                                                                                                                                                                                          | Location
|            |        |  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                          |         
|           
|            | 10.9   |  |             | Construction Loan Agreement, dated as of April 30, 2002,
    between Foundry Square Associates IV, LLC, a California limited
    liability company, as Borrower and Riverside Finance Company,
    L.L.C., a Delaware limited liability company, as Lender                                                                                                                                                                               |          | Incorporated by reference to Exhibit 10.6 to Equity
    Offices 2002 Second Quarter Form 10-Q                                          
|           
|            | 10.10  |  |             | Separation Agreement dated as of December 24, 2002, by and
    between Wilson/ Equity Office, LLC, Wilson Investors 
    California, LLC, EOP Investor, L.L.C., EOP  Concar
    Investor, L.L.C., Equity Office Properties Management Corp., EOP
    Partnership, Equity Office, William Wilson III, Thomas P.
    Sullivan, Jacqueline U. Moore, A. Robert Paratte, H. Lee Van
    Boven, Terry Reagan, Scott Stephens and Jon Knorpp |          | Incorporated by reference to Exhibit 10.8 to Equity
    Offices 2002 Annual Report on Form 10-K                                        
|           
|            | 10.11 |  |             | First Amended and Restated 1997 Share Option and Share
    Award Plan                                                                                                                                                                                                                                                                                                                                                                    |          | Incorporated by reference to Exhibit 10.2 to Equity
    Offices 2003 Second Quarter Form 10-Q                                          
|           
|            | 10.12 |  |             | First Amendment to First Amended and Restated 1997 Share
    Option and Share Award Plan                                                                                                                                                                                                                                                                                                                                                 |          | Incorporated by reference to Exhibit 10.1 to Equity
    Offices 2003 Third Quarter Form 10-Q                                           
|           
|            | 10.13 |  |             | Second Amendment to First Amended and Restated 1997 Share
    Option and Share Award Plan                                                                                                                                                                                                                                                                                                                                                |          | Incorporated by reference to Exhibit 10.2 to Equity
    Offices 2004 Second Quarter Form 10-Q                                          
|           
|            | 10.14 |  |             | Form of Share Appreciation Rights Agreement between Equity
    Office and Jan H. W. R. van der Vlist                                                                                                                                                                                                                                                                                                                                     |          | Incorporated by reference to Exhibit 10.1 to Equity
    Offices 2002 First Quarter Form 10-Q                                           
|           
|            | 10.15 |  |             | Share Appreciation Rights Agreement dated September 20,
    2004 between Equity Office and Jan H. W. R. van der Vlist (for
    SARs expiring June  15, 2013)                                                                                                                                                                                                                                                                             |          | Incorporated by reference to Exhibit 10.1 to Equity
    Offices Current Report on Form 8-K filed with the SEC
    on September 23, 2004
|           
|            | 10.16 |  |             | Share Appreciation Rights Agreement dated September 20,
    2004 between Equity Office and Jan H. W. R. van der Vlist (for
    SARs expiring June  15, 2014)                                                                                                                                                                                                                                                                             |          | Incorporated by reference to Exhibit 10.2 to Equity
    Offices Current Report on Form 8-K filed with the SEC
    on September 23, 2004
|           
|            | 10.17 |  |             | 2003 Share Option and Share Incentive Plan                                                                                                                                                                                                                                                                                                                                                                                               |          | Incorporated by reference to Exhibit 10.3 to Equity
    Offices 2003 Second Quarter Form 10-Q                                          
|           
|            | 10.18 |  |             | First Amendment to 2003 Share Option and Share Incentive
    Plan                                                                                                                                                                                                                                                                                                                                                                        |          | Incorporated by reference to Exhibit 10.2 to Equity
    Offices 2003 Third Quarter Form 10-Q                                           
|           
|            | 10.19 |  |             | Third Amended and Restated Supplemental Retirement Savings Plan,
    as amended and restated effective October 5, 2004                                                                                                                                                                                                                                                                                                                   |          | Filed herewith                                                                                                                          
|           
|            | 10.20 |  |             | Second Amended and Restated 1997 Non- Qualified Employee Share
    Purchase Plan, effective as of October 5, 2004                                                                                                                                                                                                                                                                                                                        |          | Filed herewith                                                                                                                          



---



##### Table of Contents



|            |        |  |             |                                                                                                                                                                                 |          |                                                                                                     
|----------- | ------ |  | ----------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | ----------------------------------------------------------------------------------------------------
|Exhibit No. |        |  | Description |                                                                                                                                                                                 | Location
|            |        |  |             |                                                                                                                                                                                 |         
|           
|            | 10.21 |  |             | First Amendment to the Second Amended and Restated 1997
    Non-Qualified Employee Share Purchase Plan (effective as of
    December 7, 2004)                                   |          | Filed herewith                                                                                      
|           
|            | 10.22 |  |             | First Amendment to Amended and Restated 1997 Non-Qualified Share
    Purchase Plan                                                                                              |          | Incorporated by reference to Exhibit 10.18 to Equity
    Offices 2003 Annual Report on Form 10-K   
|           
|            | 10.23 |  |             | Second Amendment to Second Amended and Restated 1997
    Non-Qualified Share Purchase Plan                                                                                      |          | Incorporated by reference to Exhibit 10.5 to Equity
    Offices 2003 Third Quarter Form 10-Q       
|           
|            | 10.24 |  |             | Third Amendment to Second Amended and Restated 1997
    Non-Qualified Share Purchase Plan                                                                                       |          | Incorporated by reference to Exhibit 10.6 to Equity
    Offices 2003 Third Quarter Form 10-Q       
|           
|            | 10.25 |  |             | Change in Control Agreement by and between Equity Office
    Management L.L.C., Equity Office and Richard D. Kincaid                                                            |          | Incorporated by reference to Exhibit 10.7 to Equity
    Offices 2003 Third Quarter Form 10-Q       
|           
|            | 10.26 |  |             | Change in Control Agreement by and between Equity Office
    Properties Management Corp., Equity Office and Peter H. Adams                                                      |          | Incorporated by reference to Exhibit 10.3 to Equity
    Offices 2001 Third Quarter Form 10-Q       
|           
|            | 10.27 |  |             | Assumption and Amendment to Change in Control Agreement by and
    between Equity Office Properties Management Corp., Equity
    Office, EOP Partnership and Peter H. Adams     |          | Incorporated by reference to Exhibit 10.2 to Equity
    Offices 2002 Third Quarter Form 10-Q       
|           
|            | 10.28 |  |             | Change in Control Agreement by and between Equity Office
    Properties Management Corp., Equity Office and Stanley M. Stevens                                                  |          | Incorporated herein by reference to Exhibit 10.8 to Equity
    Offices 2001 Third Quarter Form 10-Q
|           
|            | 10.29 |  |             | Assumption and Amendment to Change in Control Agreement by and
    between Equity Office Properties Management Corp., Equity
    Office, EOP Partnership and Stanley M. Stevens |          | Incorporated by reference to Exhibit 10.4 to Equity
    Offices 2002 Third Quarter Form 10-Q       
|           
|            | 10.30 |  |             | Second Assumption and Amendment to Change in Control Agreement
    by and between Equity Office Management L.L.C., Equity Office,
    EOP Partnership and Stanley M. Stevens    |          | Incorporated by reference to Exhibit 10.26 to Equity
    Offices 2003 Annual Report on Form 10-K   
|           
|            | 10.31 |  |             | Change in Control Agreement by and between EOP Partnership,
    Equity Office and Marsha C. Williams                                                                            |          | Incorporated herein by reference to Exhibit 10.1 to Equity
    Offices 2004 First Quarter Form 10-Q
|           
|            | 10.32 |  |             | Assumption to Change in Control Agreement by and between Equity
    Office Management L.L.C., Equity Office, EOP Partnership and
    Marsha C. Williams                         |          | Incorporated herein by reference to Exhibit 10.2 to Equity
    Offices 2004 First Quarter Form 10-Q
|           
|            | 10.33 |  |             | Change in Control Agreement by and between Equity Office
    Management L.L.C., Equity Office and Jeffrey L. Johnson                                                            |          | Incorporated herein by reference to Exhibit 10.3 to Equity
    Offices 2004 First Quarter Form 10-Q



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##### Table of Contents



|            |        |  |             |                                                                                                                                                                                                                       |          |                                                                                                                                        
|----------- | ------ |  | ----------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | ---------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |        |  | Description |                                                                                                                                                                                                                       | Location
|            |        |  |             |                                                                                                                                                                                                                       |         
|           
|            | 10.34 |  |             | Trustee Compensation Agreement between Sam Zell and Equity
    Office, as amended                                                                                                                                     |          | Incorporated by reference to Exhibit 10.28 to Equity
    Offices 2003 Annual Report on Form 10-K                                      
|           
|            | 10.35 |  |             | Form of Non-Qualified Share Option Agreement for Members of the
    Board of Trustees                                                                                                                                 |          | Incorporated by reference to Exhibit 10.1 to Equity
    Offices Current Report on Form 8-K filed with the SEC
    on February 23, 2005
|           
|            | 10.36 |  |             | Form of Participant Summary and Restricted Share Agreement for
    Trustees                                                                                                                                           |          | Incorporated by reference to Exhibit 10.2 to Equity
    Offices Current Report on Form 8-K filed with the SEC
    on February 23, 2005
|           
|            | 10.37 |  |             | Form of Non-Qualified Share Option Agreement for Employees                                                                                                                                                            |          | Incorporated by reference to Exhibit 10.3 to Equity
    Offices Current Report on Form 8-K filed with the SEC
    on February 23, 2005
|           
|            | 10.38 |  |             | Form of Participant Summary and Restricted Share Agreement for
    Employees                                                                                                                                          |          | Incorporated by reference to Exhibit 10.4 to Equity
    Offices Current Report on Form 8-K filed with the SEC
    on February 23, 2005
|           
|            | 10.39  |  |             | Revolving Credit Agreement for $1,000,000,000 Revolving Credit
    Facility dated as of May 9, 2003 among EOP Operating
    Limited Partnership and the Banks listed therein                                          |          | Incorporated by reference to Exhibit 4.1 to Equity
    Offices 2003 First Quarter Form 10-Q                                           
|           
|            | 10.40  |  |             | Guaranty of Payment  No. 1 dated as of
    May 9, 2003                                                                                                                                                               |          | Incorporated by reference to Exhibit 4.2 to Equity
    Offices 2003 First Form 10-Q                                                   
|           
|            | 10.41  |  |             | Guaranty of Payment  No. 2 dated as of
    May 9, 2003                                                                                                                                                               |          | Incorporated by reference to Exhibit 4.3 to Equity
    Offices 2003 First Quarter Form 10-Q                                           
|           
|            | 10.42  |  |             | Amendment dated December 14, 2004 to Revolving Credit
    Agreement for $1,000,000,000 Revolving Credit Facility dated as
    of May 9, 2003 among EOP Operating Limited Partnership and
    the Banks listed therein |          | Incorporated by reference to Exhibit 10.1 to Equity
    Offices Current Report on Form 8-K filed with the SEC
    on December 20, 2004
|           
|            | 10.43  |  |             | Revolving Credit Agreement for $1,000,000,000 Revolving Credit
    Facility dated as of December 17, 2003 among EOP Operating
    Limited Partnership and the Banks listed therein                                    |          | Incorporated by reference to Exhibit 10.32 to Equity
    Offices 2003 Annual Report on Form 10-K                                      
|           
|            | 10.44  |  |             | Guaranty of Payment dated as of December 17, 2003                                                                                                                                                                     |          | Incorporated by reference to Exhibit 10.33 to Equity
    Offices 2003 Annual Report on Form 10-K                                      
|           
|            | 10.45  |  |             | Revolving Credit Agreement for $500,000,000 Bridge Revolving
    Credit Facility dated as of July 29, 2004, and related
    Guaranty of Payment                                                                       |          | Incorporated herein by reference to Exhibit 10.1 to EOP
    Partnerships 2004 Third Quarter Form 10-Q                                 



---



##### Table of Contents



|            |       |  |             |                                                                                                                                                                                                                                           |          |                                                                                                  
|----------- | ----- |  | ----------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | -------------------------------------------------------------------------------------------------
|Exhibit No. |       |  | Description |                                                                                                                                                                                                                                           | Location
|            |       |  |             |                                                                                                                                                                                                                                           |         
|           
|            | 10.46 |  |             | Credit Agreement for $250,000,000 Credit Facility dated as of
    February 10, 2005, and related Guaranty of Payment                                                                                                                      |          | Filed herewith                                                                                   
|           
|            | 10.47 |  |             | Construction Loan Agreement, dated as of November 21, 2002,
    by and between WEO- Concar LLC, a California limited liability
    company, as Borrower and Riverside Finance L.L.C., a Delaware
    limited liability company, as Lender |          | Incorporated by reference to Exhibit 10.17 to Equity
    Offices 2002 Annual Report on Form 10-K
|           
|            | 12.1  |  |             | Statement of Earnings to Fixed Charges                                                                                                                                                                                                    |          | Filed herewith                                                                                   
|           
|            | 21.1  |  |             | List of Subsidiaries                                                                                                                                                                                                                      |          | Incorporated by reference to Exhibit 21.1 to Equity
    Offices 2002 Annual Report on Form 10-K 
|           
|            | 23.1  |  |             | Consent of Independent Registered Public Accounting Firm                                                                                                                                                                                  |          | Filed herewith                                                                                   
|           
|            | 31.1  |  |             | Rule 13a-14(a)/15d-14(a) Certifications                                                                                                                                                                                                   |          | Filed herewith                                                                                   
|           
|            | 32.1  |  |             | Section 1350 Certifications                                                                                                                                                                                                               |          | Filed herewith                                                                                   
|           
|            | 99.1  |  |             | 1997 Non-Qualified Employee Share Purchase Plan Financial
    Statements as of December 31, 2004 and 2003 and for each of
    the three years in the period ended December 31, 2004                                                       |          | Filed herewith                                                                                   




|  |                                                                                    
|- | -----------------------------------------------------------------------------------
| | Represents a management contract or compensatory plan, contract
    or arrangement.



---



##### Table of Contents



Schedule III  Real Estate and Accumulated
Depreciation as of December 31, 2004


| |  |                                       |  |       |         |  |          |              |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |   |      |  |           |              |        |   |               |   |        |              |             |   |            |  |          |   |          |  |  |   |         |   |  |                |  |          |  |  |    | 
| |  | ------------------------------------- |  | ----- | ------- |  | -------- | ------------ | ------- | ------------ | -- | ------------ | --------- | ------------- | ------------ | ----------------- | --------------- | ------------ | ----------------------- | ------------ | ------- | - | ------- | ------------ | ------------ | - | ---- |  | --------- | ------------ | ------ | - | ------------- | - | ------ | ------------ | ----------- | - | ---------- |  | -------- | - | -------- |  |  | - | ------- | - |  | -------------- |  | -------- |  |  | -- | 
| |  |                                       |  |       |         |  |          |              |         |              |    |              |           |               |              | Costs Capitalized |                 |              | Gross Amount Carried at |              |         |   |         |              |              |   |      |  |           |             
| |  |                                       |  |       |         |  |          |              |         |              |    |              |           | Subsequent to |              |                   | Close of Period |              |                         |              |         |   |         |              |              |   |      | 
| |  |                                       |  |       |         |  |          |              |         |              |    | Initial Cost |           |               | Acquisition  |                   |                 | 12/31/2004   |                         |              |         |   |         |              |              |   |      |  |          
| |  |                                       |  |       |         |  |          |              |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              | Date of      |   |      |  |          
| |  |                                       |  |       |         |  |          |              |         | Encumbrances |    |              |           |               | Building and |                   |                 |              |                         | Building and |         |   |         |              | Building and |   |      |  |           | Accumulated  |        |   | Construction/ |   | Date   |              | Depreciable |  
| |  | Description                           |  | Notes |         |  | Location |              | State   |              |    | at 12/31/04  |           |               | Land         |                   |                 | Improvements |                         |              | Land    |   |         | Improvements |              |   | Land |  |           | Improvements |        |   | Total(1)      |   |        | Depreciation |             |   | Renovation |  | Acquired |   | Lives(2) | 
| |  |                                       |  |       |         |  |          |              |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |   |      |  |           |              |        |   |               |   |        |              |             |   |            |  |          |   |          | 
| |  | Office Properties:                    |  |       |         |  |          |              |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |   |      |  |           |              |        |   |               |   |        |              |             |   |            |  |          |   |          |  |  |   |         |   |  |                |  |          |  |  |    | 
| |  | Atlanta Region                        |  |       |         |  |          |              |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |   |      |  |           |              |        |   |               |   |        |              |             |   |            |  |          |   |          |  |  |   |         |   |  |                |  |          |  |  |    | 
| |  | 200 Galleria                          |  |       |         |  |          | Atlanta      |         |              | GA |              |           | $             |             |                   |                 | $            | 10,282                  |              |         | $ | 58,266  |              |              | $ |     |  |           | $            | 4,917  |   |               | $ | 10,282 |              |             | $ | 63,183     |  |          | $ | 73,465   |  |  | $ | (7,917  | ) |  | 1985           |  | 06/19/00 |  |  | 40 | 
| |  | One Ninety One Peachtree Tower        |  |       |         |  |          | Atlanta      |         |              | GA |              |           |               |             |                   |                 |              | 46,500                  |              |         |   | 263,500 |              |              |   |     |  |           |              | 705    |   |               |   | 46,500 |              |             |   | 264,205    |  |          |   | 310,705  |  |  |   | (30,291 | ) |  | 1991           |  | 06/19/00 |  |  | 40 | 
| |  | Central Park                          |  |       |         |  |          | Atlanta      |         |              | GA |              |           |               | 55,036       |                   |                 |              | 9,163                   |              |         |   | 82,463  |              |              |   |     |  |           |              | 6,361  |   |               |   | 9,163  |              |             |   | 88,824     |  |          |   | 97,987   |  |  |   | (17,938 | ) |  | 1986           |  | 10/17/95 |  |  | 40 | 
| |  | Lakeside Office Park                  |  |       |         |  |          | Atlanta      |         |              | GA |              |           |               |             |                   |                 |              | 4,792                   |              |         |   | 43,132  |              |              |   |     |  |           |              | 3,362  |   |               |   | 4,792  |              |             |   | 46,494     |  |          |   | 51,286   |  |  |   | (8,690  | ) |  | 1972-1978      |  | 12/19/97 |  |  | 40 | 
| |  | Paces West                            |  |       |         |  |          | Atlanta      |         |              | GA |              |           |               |             |                   |                 |              | 8,336                   |              |         |   | 75,025  |              |              |   |     |  |           |              | 8,588  |   |               |   | 8,336  |              |             |   | 83,613     |  |          |   | 91,949   |  |  |   | (16,402 | ) |  | 1988           |  | 10/31/94 |  |  | 40 | 
| |  | Perimeter Center                      |  |       |         |  |          | Atlanta      |         |              | GA |              |           |               | 185,228      |                   |                 |              | 46,817                  |              |         |   | 402,107 |              |              |   | 280  |  |           |              | 34,970 |   |               |   | 47,097 |              |             |   | 437,077    |  |          |   | 484,174  |  |  |   | (84,392 | ) |  | 1970/1989      |  | 12/19/97 |  |  | 40 | 
| |  |                                       |  |       |         |  |          |              |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |   |      |  |           |              |        |   |               |   |        |              |             |   |            |  |          |   |          | 
|
| |  | Atlanta Region Totals                 |  |       | 240,264 |  |          |              | 125,890 |              |    |              | 924,493   |               |              |                   | 280             |              |                         |              | 58,903  |   |         |              | 126,170      |   |      |  | 983,396   |              |        |   | 1,109,566     |   |        |              | (165,630    | ) |            |  |          |   |          |  |  |  
| |  |                                       |  |       |         |  |          |              |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |   |      |  |           |              |        |   |               |   |        |             
|
| |  | Boston Region                         |  |       |         |  |          |              |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |   |      |  |           |              |        |   |               |   |        |              |             |   |            |  |          |   |          |  |  |   |         |   |  |                |  |          |  |  |    | 
| |  | Crosby Corporate Center               |  |       |         |  |          | Bedford      |         |              | MA |              |           |               |             |                   |                 |              | 5,958                   |              |         |   | 53,620  |              |              |   | 115  |  |           |              | 2,540  |   |               |   | 6,073  |              |             |   | 56,160     |  |          |   | 62,233   |  |  |   | (10,042 | ) |  | 1996           |  | 12/19/97 |  |  | 40 | 
| |  | Crosby Corporate Center II            |  |       |         |  |          | Bedford      |         |              | MA |              |           |               |             |                   |                 |              | 9,385                   |              |         |   | 27,584  |              |              |   | 8    |  |           |              | 4,545  |   |               |   | 9,393  |              |             |   | 32,129     |  |          |   | 41,522   |  |  |   | (7,160  | ) |  | 1998           |  | 12/19/97 |  |  | 40 | 
| |  | 125 Summer Street                     |  |       |         |  |          | Boston       |         |              | MA |              |           |               | 68,663       |                   |                 |              | 18,000                  |              |         |   | 102,000 |              |              |   |     |  |           |              | 11,740 |   |               |   | 18,000 |              |             |   | 113,740    |  |          |   | 131,740  |  |  |   | (13,885 | ) |  | 1989           |  | 06/19/00 |  |  | 40 | 
| |  | 222 Berkley Street                    |  |       |         |  |          | Boston       |         |              | MA |              |           |               |             |                   |                 |              | 25,593                  |              |         |   | 145,029 |              |              |   |     |  |           |              | 5,583  |   |               |   | 25,593 |              |             |   | 150,612    |  |          |   | 176,205  |  |  |   | (18,085 | ) |  | 1991           |  | 06/19/00 |  |  | 40 | 
| |  | 500 Boylston Street                   |  |       |         |  |          | Boston       |         |              | MA |              |           |               |             |                   |                 |              | 39,000                  |              |         |   | 221,000 |              |              |   |     |  |           |              | 2,036  |   |               |   | 39,000 |              |             |   | 223,036    |  |          |   | 262,036  |  |  |   | (25,215 | ) |  | 1988           |  | 06/19/00 |  |  | 40 | 
| |  | Sixty State Street                    |  |       |         |  |          | Boston       |         |              | MA |              |           |               | 72,353       |                   |                 |              |                        |              |         |   | 256,000 |              |              |   |     |  |           |              | 8,300  |   |               |   |       |              |             |   | 264,300    |  |          |   | 264,300  |  |  |   | (29,970 | ) |  | 1979           |  | 06/19/00 |  |  | 40 | 
| |  | 100 Summer Street                     |  |       |         |  |          | Boston       |         |              | MA |              |           |               |             |                   |                 |              | 22,271                  |              |         |   | 200,439 |              |              |   |     |  |           |              | 66,570 |   |               |   | 22,271 |              |             |   | 267,009    |  |          |   | 289,280  |  |  |   | (44,062 | ) |  | 1974/1990      |  | 03/18/98 |  |  | 40 | 
| |  | 150 Federal Street                    |  |       |         |  |          | Boston       |         |              | MA |              |           |               |             |                   |                 |              | 14,131                  |              |         |   | 127,182 |              |              |   |     |  |           |              | 17,859 |   |               |   | 14,131 |              |             |   | 145,041    |  |          |   | 159,172  |  |  |   | (30,141 | ) |  | 1988           |  | 12/19/97 |  |  | 40 | 
| |  | 175 Federal Street                    |  |       |         |  |          | Boston       |         |              | MA |              |           |               |             |                   |                 |              | 4,894                   |              |         |   | 44,045  |              |              |   |     |  |           |              | 5,011  |   |               |   | 4,894  |              |             |   | 49,056     |  |          |   | 53,950   |  |  |   | (9,221  | ) |  | 1977           |  | 12/19/97 |  |  | 40 | 
| |  | 2 Oliver Street- 147 Milk Street      |  |       |         |  |          | Boston       |         |              | MA |              |           |               |             |                   |                 |              | 5,017                   |              |         |   | 45,157  |              |              |   |     |  |           |              | 1,936  |   |               |   | 5,017  |              |             |   | 47,093     |  |          |   | 52,110   |  |  |   | (8,903  | ) |  | 1988           |  | 12/19/97 |  |  | 40 | 
| |  | 225 Franklin Street                   |  |       |         |  |          | Boston       |         |              | MA |              |           |               |             |                   |                 |              | 34,608                  |              |         |   | 311,471 |              |              |   |     |  |           |              | 12,975 |   |               |   | 34,608 |              |             |   | 324,446    |  |          |   | 359,054  |  |  |   | (58,745 | ) |  | 1966/1996      |  | 12/19/97 |  |  | 40 | 
| |  | 28 State Street                       |  |       |         |  |          | Boston       |         |              | MA |              |           |               |             |                   |                 |              | 9,513                   |              |         |   | 85,623  |              |              |   |     |  |           |              | 42,835 |   |               |   | 9,513  |              |             |   | 128,458    |  |          |   | 137,971  |  |  |   | (35,642 | ) |  | 1968/1997      |  | 01/23/95 |  |  | 40 | 
| |  | Center Plaza                          |  |       |         |  |          | Boston       |         |              | MA |              |           |               |             |                   |                 |              | 18,942                  |              |         |   | 170,480 |              |              |   |     |  |           |              | 11,499 |   |               |   | 18,942 |              |             |   | 181,979    |  |          |   | 200,921  |  |  |   | (33,441 | ) |  | 1969           |  | 12/19/97 |  |  | 40 | 
| |  | Russia Wharf                          |  |       |         |  |          | Boston       |         |              | MA |              |           |               |             |                   |                 |              | 3,891                   |              |         |   | 35,023  |              |              |   |     |  |           |              | 2,909  |   |               |   | 3,891  |              |             |   | 37,932     |  |          |   | 41,823   |  |  |   | (7,887  | ) |  | 1978-1982      |  | 12/19/97 |  |  | 40 | 
| |  | South Station                         |  |       |         |  |          | Boston       |         |              | MA |              |           |               |             |                   |                 |              |                        |              |         |   | 31,074  |              |              |   |     |  |           |              | 2,128  |   |               |   |       |              |             |   | 33,202     |  |          |   | 33,202   |  |  |   | (5,917  | ) |  | 1988           |  | 12/19/97 |  |  | 40 | 
| |  | New England Executive Park            |  |       |         |  |          | Burlington   |         |              | MA |              |           |               |             |                   |                 |              | 14,733                  |              |         |   | 132,594 |              |              |   | 194  |  |           |              | 15,173 |   |               |   | 14,927 |              |             |   | 147,767    |  |          |   | 162,694  |  |  |   | (28,826 | ) |  | 1970/1985      |  | 12/19/97 |  |  | 40 | 
| |  | New England Executive Park 17         |  |       |         |  |          | Burlington   |         |              | MA |              |           |               |             |                   |                 |              | 904                     |              |         |   | 8,135   |              |              |   | 8    |  |           |              | 950    |   |               |   | 912    |              |             |   | 9,085      |  |          |   | 9,997    |  |  |   | (1,854  | ) |  | 1970/1985      |  | 12/19/97 |  |  | 40 | 
| |  | The Tower at N.E.E.P.                 |  |       |         |  |          | Burlington   |         |              | MA |              |           |               |             |                   |                 |              | 2,793                   |              |         |   | 31,462  |              |              |   | 5    |  |           |              | 10,120 |   |               |   | 2,798  |              |             |   | 41,582     |  |          |   | 44,380   |  |  |   | (7,595  | ) |  | 1971/1999      |  | 03/31/98 |  |  | 40 | 
| |  | One Memorial Drive                    |  |       |         |  |          | Cambridge    |         |              | MA |              |           |               | 55,754       |                   |                 |              | 14,862                  |              |         |   | 88,216  |              |              |   |     |  |           |              | 3,930  |   |               |   | 14,862 |              |             |   | 92,146     |  |          |   | 107,008  |  |  |   | (10,653 | ) |  | 1985           |  | 06/19/00 |  |  | 40 | 
| |  | One Canal Park                        |  |       |         |  |          | Cambridge    |         |              | MA |              |           |               |             |                   |                 |              | 2,006                   |              |         |   | 18,054  |              |              |   |     |  |           |              | 2,396  |   |               |   | 2,006  |              |             |   | 20,450     |  |          |   | 22,456   |  |  |   | (3,892  | ) |  | 1987           |  | 12/19/97 |  |  | 40 | 
| |  | 245 First Street (a/k/a Riverview II) |  |       |         |  |          | Cambridge    |         |              | MA |              |           |               |             |                   |                 |              | 3,978                   |              |         |   | 35,804  |              |              |   | 6    |  |           |              | 2,946  |   |               |   | 3,984  |              |             |   | 38,750     |  |          |   | 42,734   |  |  |   | (6,834  | ) |  | 1985-1986      |  | 12/19/97 |  |  | 40 | 
| |  | Ten Canal Park                        |  |       |         |  |          | Cambridge    |         |              | MA |              |           |               |             |                   |                 |              | 2,383                   |              |         |   | 21,448  |              |              |   |     |  |           |              | 176    |   |               |   | 2,383  |              |             |   | 21,624     |  |          |   | 24,007   |  |  |   | (3,801  | ) |  | 1987           |  | 12/19/97 |  |  | 40 | 
| |  | Riverside Center                      |  |       |         |  |          | Newton       |         |              | MA |              |           |               |             |                   |                 |              | 24,000                  |              |         |   | 69,849  |              |              |   |     |  |           |              | 19,909 |   |               |   | 24,000 |              |             |   | 89,758     |  |          |   | 113,758  |  |  |   | (14,770 | ) |  | 2000           |  | 12/19/97 |  |  | 40 | 
| |  | 175 Wyman Street                      |  |       |         |  |          | Walthan      |         |              | MA |              |           |               |             |                   |                 |              | 14,600                  |              |         |   | 5,400   |              |              |   | 3    |  |           |              | 1,503  |   |               |   | 14,603 |              |             |   | 6,903      |  |          |   | 21,506   |  |  |   | (6,826  | ) |  | 1999           |  | 12/19/97 |  |  | 40 | 
| |  | Wellesley Office Park 1-4             |  |       |         |  |          | Wellesley    |         |              | MA |              |           |               |             |                   |                 |              | 5,518                   |              |         |   | 49,662  |              |              |   | 6    |  |           |              | 5,610  |   |               |   | 5,524  |              |             |   | 55,272     |  |          |   | 60,796   |  |  |   | (10,219 | ) |  | 1963/1984      |  | 12/19/97 |  |  | 40 | 
| |  | Wellesley 5-7                         |  |       |         |  |          | Wellesley    |         |              | MA |              |           |               |             |                   |                 |              | 9,335                   |              |         |   | 84,018  |              |              |   | 13   |  |           |              | 5,297  |   |               |   | 9,348  |              |             |   | 89,315     |  |          |   | 98,663   |  |  |   | (16,229 | ) |  | 1963/1984      |  | 12/19/97 |  |  | 40 | 
| |  | Wellesley 8                           |  |       |         |  |          | Wellesley    |         |              | MA |              |           |               |             |                   |                 |              | 1,639                   |              |         |   | 14,754  |              |              |   | 2    |  |           |              | 286    |   |               |   | 1,641  |              |             |   | 15,040     |  |          |   | 16,681   |  |  |   | (2,631  | ) |  | 1963/1984      |  | 12/19/97 |  |  | 40 | 
| |  |                                       |  |       |         |  |          |              |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |   |      |  |           |              |        |   |               |   |        |              |             |   |            |  |          |   |          | 
|
| |  | Boston Region Totals                  |  |       | 196,770 |  |          |              | 307,954 |              |    |              | 2,415,123 |               |              |                   | 360             |              |                         |              | 266,762 |   |         |              | 308,314      |   |      |  | 2,681,885 |              |        |   | 2,990,199     |   |        |              | (452,446    | ) |            |  |          |   |          |  |  |  
| |  |                                       |  |       |         |  |          |              |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |   |      |  |           |              |        |   |               |   |        |             
|
| |  | Chicago Region                        |  |       |         |  |          |              |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |   |      |  |           |              |        |   |               |   |        |              |             |   |            |  |          |   |          |  |  |   |         |   |  |                |  |          |  |  |    | 
| |  | 101 North Wacker                      |  |       |         |  |          | Chicago      |         |              | IL |              |           |               |             |                   |                 |              | 10,035                  |              |         |   | 90,319  |              |              |   |     |  |           |              | 5,451  |   |               |   | 10,035 |              |             |   | 95,770     |  |          |   | 105,805  |  |  |   | (18,218 | ) |  | 1980/1990      |  | 12/19/97 |  |  | 40 | 
| |  | 200 West Adams                        |  |       |         |  |          | Chicago      |         |              | IL |              |           |               |             |                   |                 |              | 11,654                  |              |         |   | 104,887 |              |              |   |     |  |           |              | 8,270  |   |               |   | 11,654 |              |             |   | 113,157    |  |          |   | 124,811  |  |  |   | (22,989 | ) |  | 1985/1996      |  | 12/19/97 |  |  | 40 | 
| |  | 30 North LaSalle                      |  |       |         |  |          | Chicago      |         |              | IL |              |           |               |             |                   |                 |              | 12,489                  |              |         |   | 112,401 |              |              |   |     |  |           |              | 7,690  |   |               |   | 12,489 |              |             |   | 120,091    |  |          |   | 132,580  |  |  |   | (24,639 | ) |  | 1974/1990      |  | 06/13/97 |  |  | 40 | 
| |  | Civic Opera House                     |  |       |         |  |          | Chicago      |         |              | IL |              |           |               |             |                   |                 |              | 12,771                  |              |         |   | 114,942 |              |              |   |     |  |           |              | 8,808  |   |               |   | 12,771 |              |             |   | 123,750    |  |          |   | 136,521  |  |  |   | (23,691 | ) |  | 1929/1996      |  | 12/19/97 |  |  | 40 | 
| |  | One North Franklin                    |  |       |         |  |          | Chicago      |         |              | IL |              |           |               |             |                   |                 |              | 9,830                   |              |         |   | 88,474  |              |              |   |     |  |           |              | 7,727  |   |               |   | 9,830  |              |             |   | 96,201     |  |          |   | 106,031  |  |  |   | (18,317 | ) |  | 1991           |  | 12/31/92 |  |  | 40 | 
| |  | Presidents Plaza                      |  |       |         |  |          | Chicago      |         |              | IL |              |           |               |             |                   |                 |              | 13,435                  |              |         |   | 120,919 |              |              |   |     |  |           |              | 11,103 |   |               |   | 13,435 |              |             |   | 132,022    |  |          |   | 145,457  |  |  |   | (24,121 | ) |  | 1980-1982      |  | 12/19/97 |  |  | 40 | 
| |  | BP Tower                              |  |       |         |  |          | Cleveland    |         |              | OH |              |           |               |             |                   |                 |              | 17,403                  |              |         |   | 157,260 |              |              |   |     |  |           |              | 11,843 |   |               |   | 17,403 |              |             |   | 169,103    |  |          |   | 186,506  |  |  |   | (33,069 | ) |  | 1985           |  | 09/04/96 |  |  | 40 | 
| |  | Community Corporate Center            |  |       |         |  |          | Columbus     |         |              | OH |              |           |               |             |                   |                 |              | 3,019                   |              |         |   | 27,170  |              |              |   |     |  |           |              | 3,570  |   |               |   | 3,019  |              |             |   | 30,740     |  |          |   | 33,759   |  |  |   | (6,894  | ) |  | 1987           |  | 06/14/90 |  |  | 40 | 
| |  | One Crosswoods                        |  |       | (3)     |  |          | Columbus     |         |              | OH |              |           |               |             |                   |                 |              | 1,059                   |              |         |   | 9,530   |              |              |   |     |  |           |              | (3,382 | ) |               |   | 1,059  |              |             |   | 6,148      |  |          |   | 7,207    |  |  |   | (818    | ) |  | 1984           |  | 11/12/93 |  |  | 40 | 
| |  | Corporate 500 Centre                  |  |       |         |  |          | Deerfield    |         |              | IL |              |           |               | 75,460       |                   |                 |              | 20,100                  |              |         |   | 113,900 |              |              |   |     |  |           |              | 8,235  |   |               |   | 20,100 |              |             |   | 122,135    |  |          |   | 142,235  |  |  |   | (14,939 | ) |  | 1986/1990      |  | 06/19/00 |  |  | 40 | 
| |  | 1700 Higgins Centre                   |  |       |         |  |          | Des Plaines  |         |              | IL |              |           |               |             |                   |                 |              | 1,323                   |              |         |   | 11,908  |              |              |   | 64   |  |           |              | 1,104  |   |               |   | 1,387  |              |             |   | 13,012     |  |          |   | 14,399   |  |  |   | (2,608  | ) |  | 1986           |  | 11/12/93 |  |  | 40 | 
| |  | Tri-State International               |  |       |         |  |          | Lincolnshire |         |              | IL |              |           |               |             |                   |                 |              | 10,925                  |              |         |   | 98,327  |              |              |   | 291  |  |           |              | 5,643  |   |               |   | 11,216 |              |             |   | 103,970    |  |          |   | 115,186  |  |  |   | (19,227 | ) |  | 1986           |  | 12/19/97 |  |  | 40 | 
| |  | 1111 West 22nd Street                 |  |       |         |  |          | Oakbrook     |         |              | IL |              |           |               |             |                   |                 |              | 4,834                   |              |         |   | 43,508  |              |              |   | 48   |  |           |              | 2,289  |   |               |   | 4,882  |              |             |   | 45,797     |  |          |   | 50,679   |  |  |   | (8,622  | ) |  | 1984           |  | 12/19/97 |  |  | 40 | 
| |  | Commerce Plaza                        |  |       | (11)    |  |          | Oakbrook     |         |              | IL |              |           |               |             |                   |                 |              | 18,000                  |              |         |   | 76,149  |              |              |   |     |  |           |              | 181    |   |               |   | 18,000 |              |             |   | 76,330     |  |          |   | 94,330   |  |  |   | (1,682  | ) |  | 1972-1974/1988 |  | 09/23/04 |  |  | 35 | 
| |  | One Lincoln Centre                    |  |       |         |  |          | Oakbrook     |         |              | IL |              |           |               |             |                   |                 |              | 7,350                   |              |         |   | 41,650  |              |              |   |     |  |           |              | 3,595  |   |               |   | 7,350  |              |             |   | 45,245     |  |          |   | 52,595   |  |  |   | (5,773  | ) |  | 1986           |  | 06/19/00 |  |  | 40 | 



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##### Table of Contents



| |  |                                  |  |       |         |  |          |                  |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          |  |  |  |         |   |  |                  |  |          |  |  |    | 
| |  | -------------------------------- |  | ----- | ------- |  | -------- | ---------------- | ------- | ------------ | -- | ------------ | --------- | ------------- | ------------ | ----------------- | --------------- | ------------ | ----------------------- | ------------ | ------- |  | ------- | ------------ | ------------ |  | ---- |  | --------- | ------------ | ------- | - | ------------- |  | ------ | ------------ | ----------- | - | ---------- |  | -------- |  | -------- |  |  |  | ------- | - |  | ---------------- |  | -------- |  |  | -- | 
| |  |                                  |  |       |         |  |          |                  |         |              |    |              |           |               |              | Costs Capitalized |                 |              | Gross Amount Carried at |              |         |  |         |              |              |  |      |  |           |             
| |  |                                  |  |       |         |  |          |                  |         |              |    |              |           | Subsequent to |              |                   | Close of Period |              |                         |              |         |  |         |              |              |  |      | 
| |  |                                  |  |       |         |  |          |                  |         |              |    | Initial Cost |           |               | Acquisition  |                   |                 | 12/31/2004   |                         |              |         |  |         |              |              |  |      |  |          
| |  |                                  |  |       |         |  |          |                  |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              | Date of      |  |      |  |          
| |  |                                  |  |       |         |  |          |                  |         | Encumbrances |    |              |           |               | Building and |                   |                 |              |                         | Building and |         |  |         |              | Building and |  |      |  |           | Accumulated  |         |   | Construction/ |  | Date   |              | Depreciable |  
| |  | Description                      |  | Notes |         |  | Location |                  | State   |              |    | at 12/31/04  |           |               | Land         |                   |                 | Improvements |                         |              | Land    |  |         | Improvements |              |  | Land |  |           | Improvements |         |   | Total(1)      |  |        | Depreciation |             |   | Renovation |  | Acquired |  | Lives(2) | 
| |  |                                  |  |       |         |  |          |                  |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          | 
| |  | Oakbrook Terrace Tower           |  |       |         |  |          | Oakbrook Terrace |         |              | IL |              |           |               |             |                   |                 |              | 11,950                  |              |         |  | 107,552 |              |              |  | 486  |  |           |              | 6,731   |   |               |  | 12,436 |              |             |   | 114,283    |  |          |  | 126,719  |  |  |  | (23,077 | ) |  | 1988             |  | 04/16/97 |  |  | 40 | 
| |  | Westbrook Corporate Center       |  |       |         |  |          | Westchester      |         |              | IL |              |           |               | 95,071       |                   |                 |              | 24,875                  |              |         |  | 223,874 |              |              |  | 30   |  |           |              | 24,734  |   |               |  | 24,905 |              |             |   | 248,608    |  |          |  | 273,513  |  |  |  | (46,558 | ) |  | 1985/1996        |  | 12/19/97 |  |  | 40 | 
| |  |                                  |  |       |         |  |          |                  |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          | 
|
| |  | Chicago Region Totals            |  |       | 170,531 |  |          |                  | 191,052 |              |    |              | 1,542,770 |               |              |                   | 919             |              |                         |              | 113,592 |  |         |              | 191,971      |  |      |  | 1,656,362 |              |         |   | 1,848,333     |  |        |              | (295,242    | ) |            |  |          |  |          |  |  | 
| |  |                                  |  |       |         |  |          |                  |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |         |   |               |  |        |             
|
| |  | Denver Region                    |  |       |         |  |          |                  |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          |  |  |  |         |   |  |                  |  |          |  |  |    | 
| |  | 410 17th Street                  |  |       |         |  |          | Denver           |         |              | CO |              |           |               |             |                   |                 |              | 4,474                   |              |         |  | 40,264  |              |              |  |     |  |           |              | 8,700   |   |               |  | 4,474  |              |             |   | 48,964     |  |          |  | 53,438   |  |  |  | (9,030  | ) |  | 1978             |  | 04/30/98 |  |  | 40 | 
| |  | 4949 South Syracuse              |  |       |         |  |          | Denver           |         |              | CO |              |           |               |             |                   |                 |              | 822                     |              |         |  | 7,401   |              |              |  | 23   |  |           |              | 1,352   |   |               |  | 845    |              |             |   | 8,753      |  |          |  | 9,598    |  |  |  | (1,693  | ) |  | 1982             |  | 07/15/98 |  |  | 40 | 
| |  | Denver Corporate Center II & III |  |       |         |  |          | Denver           |         |              | CO |              |           |               |             |                   |                 |              | 6,059                   |              |         |  | 36,534  |              |              |  | 4    |  |           |              | 6,697   |   |               |  | 6,063  |              |             |   | 43,231     |  |          |  | 49,294   |  |  |  | (9,018  | ) |  | 1981/1993-1997   |  | 12/20/90 |  |  | 40 | 
| |  | Denver Post Tower                |  |       |         |  |          | Denver           |         |              | CO |              |           |               |             |                   |                 |              |                        |              |         |  | 52,937  |              |              |  |     |  |           |              | 7,221   |   |               |  |       |              |             |   | 60,158     |  |          |  | 60,158   |  |  |  | (12,491 | ) |  | 1984             |  | 04/21/98 |  |  | 40 | 
| |  | Dominion Plaza                   |  |       |         |  |          | Denver           |         |              | CO |              |           |               |             |                   |                 |              | 5,990                   |              |         |  | 53,911  |              |              |  |     |  |           |              | 7,192   |   |               |  | 5,990  |              |             |   | 61,103     |  |          |  | 67,093   |  |  |  | (12,210 | ) |  | 1983             |  | 05/14/98 |  |  | 40 | 
| |  | Metropoint I                     |  |       |         |  |          | Denver           |         |              | CO |              |           |               |             |                   |                 |              | 6,375                   |              |         |  | 39,375  |              |              |  |     |  |           |              | 4,693   |   |               |  | 6,375  |              |             |   | 44,068     |  |          |  | 50,443   |  |  |  | (7,858  | ) |  | 1987             |  | 07/15/98 |  |  | 40 | 
| |  | Metropoint II                    |  |       |         |  |          | Denver           |         |              | CO |              |           |               |             |                   |                 |              | 1,777                   |              |         |  | 17,865  |              |              |  |     |  |           |              | 3,209   |   |               |  | 1,777  |              |             |   | 21,074     |  |          |  | 22,851   |  |  |  | (4,908  | ) |  | 1999             |  | 04/10/00 |  |  | 40 | 
| |  | U.S. Bank Tower                  |  |       | (11)    |  |          | Denver           |         |              | CO |              |           |               |             |                   |                 |              | 6,301                   |              |         |  | 72,274  |              |              |  |     |  |           |              | 2,585   |   |               |  | 6,301  |              |             |   | 74,859     |  |          |  | 81,160   |  |  |  | (5,244  | ) |  | 1974/2001        |  | 08/12/03 |  |  | 35 | 
| |  | Tabor Center                     |  |       |         |  |          | Denver           |         |              | CO |              |           |               |             |                   |                 |              | 12,948                  |              |         |  | 116,536 |              |              |  |     |  |           |              | 39,295  |   |               |  | 12,948 |              |             |   | 155,831    |  |          |  | 168,779  |  |  |  | (24,346 | ) |  | 1985             |  | 04/30/98 |  |  | 40 | 
| |  | Trinity Place                    |  |       |         |  |          | Denver           |         |              | CO |              |           |               |             |                   |                 |              | 1,898                   |              |         |  | 17,085  |              |              |  |     |  |           |              | 3,051   |   |               |  | 1,898  |              |             |   | 20,136     |  |          |  | 22,034   |  |  |  | (4,197  | ) |  | 1983             |  | 04/30/98 |  |  | 40 | 
| |  | Millennium Plaza                 |  |       |         |  |          | Englewood        |         |              | CO |              |           |               |             |                   |                 |              | 7,757                   |              |         |  | 38,314  |              |              |  |     |  |           |              | 578     |   |               |  | 7,757  |              |             |   | 38,892     |  |          |  | 46,649   |  |  |  | (6,430  | ) |  | 1982             |  | 05/19/98 |  |  | 40 | 
| |  | Terrace Building                 |  |       |         |  |          | Englewood        |         |              | CO |              |           |               |             |                   |                 |              | 1,546                   |              |         |  | 13,865  |              |              |  | 30   |  |           |              | 1,739   |   |               |  | 1,576  |              |             |   | 15,604     |  |          |  | 17,180   |  |  |  | (2,583  | ) |  | 1982             |  | 07/15/98 |  |  | 40 | 
| |  | The Quadrant                     |  |       |         |  |          | Englewood        |         |              | CO |              |           |               |             |                   |                 |              | 4,357                   |              |         |  | 39,215  |              |              |  |     |  |           |              | 4,455   |   |               |  | 4,357  |              |             |   | 43,670     |  |          |  | 48,027   |  |  |  | (8,919  | ) |  | 1985             |  | 12/01/92 |  |  | 40 | 
| |  | The Solarium                     |  |       |         |  |          | Englewood        |         |              | CO |              |           |               |             |                   |                 |              | 1,951                   |              |         |  | 17,560  |              |              |  |     |  |           |              | 2,603   |   |               |  | 1,951  |              |             |   | 20,163     |  |          |  | 22,114   |  |  |  | (3,768  | ) |  | 1982             |  | 07/15/98 |  |  | 40 | 
| |  | Wells Fargo Center               |  |       |         |  |          | Minneapolis      |         |              | MN |              |           |               | 110,831      |                   |                 |              | 39,045                  |              |         |  | 221,255 |              |              |  |     |  |           |              | 1,952   |   |               |  | 39,045 |              |             |   | 223,207    |  |          |  | 262,252  |  |  |  | (25,384 | ) |  | 1988             |  | 06/19/00 |  |  | 40 | 
| |  | LaSalle Plaza                    |  |       |         |  |          | Minneapolis      |         |              | MN |              |           |               |             |                   |                 |              | 9,681                   |              |         |  | 87,127  |              |              |  |     |  |           |              | 5,006   |   |               |  | 9,681  |              |             |   | 92,133     |  |          |  | 101,814  |  |  |  | (17,582 | ) |  | 1991             |  | 11/25/97 |  |  | 40 | 
| |  | 49 E. Thomas Road                |  |       |         |  |          | Phoenix          |         |              | AZ |              |           |               |             |                   |                 |              | 65                      |              |         |  | 588     |              |              |  |     |  |           |              | 91      |   |               |  | 65     |              |             |   | 679        |  |          |  | 744      |  |  |  | (139    | ) |  | 1974/1993        |  | 12/11/96 |  |  | 40 | 
| |  | One Phoenix Plaza                |  |       |         |  |          | Phoenix          |         |              | AZ |              |           |               |             |                   |                 |              | 6,192                   |              |         |  | 55,727  |              |              |  |     |  |           |              |        |   |               |  | 6,192  |              |             |   | 55,727     |  |          |  | 61,919   |  |  |  | (10,388 | ) |  | 1989             |  | 12/04/96 |  |  | 40 | 
| |  |                                  |  |       |         |  |          |                  |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          | 
|
| |  | Denver Region Totals             |  |       | 110,831 |  |          |                  | 117,238 |              |    |              | 927,833   |               |              |                   | 57              |              |                         |              | 100,419 |  |         |              | 117,295      |  |      |  | 1,028,252 |              |         |   | 1,145,547     |  |        |              | (166,188    | ) |            |  |          |  |          |  |  | 
| |  |                                  |  |       |         |  |          |                  |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |         |   |               |  |        |             
|
| |  | Houston Region                   |  |       |         |  |          |                  |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          |  |  |  |         |   |  |                  |  |          |  |  |    | 
| |  | One American Center              |  |       |         |  |          | Austin           |         |              | TX |              |           |               |             |                   |                 |              |                        |              |         |  | 70,812  |              |              |  |     |  |           |              | 11,668  |   |               |  |       |              |             |   | 82,480     |  |          |  | 82,480   |  |  |  | (16,013 | ) |  | 1984             |  | 11/01/95 |  |  | 40 | 
| |  | One Congress Plaza               |  |       |         |  |          | Austin           |         |              | TX |              |           |               |             |                   |                 |              | 6,502                   |              |         |  | 58,521  |              |              |  |     |  |           |              | 7,894   |   |               |  | 6,502  |              |             |   | 66,415     |  |          |  | 72,917   |  |  |  | (13,181 | ) |  | 1987             |  | 11/12/93 |  |  | 40 | 
| |  | San Jacinto Center               |  |       |         |  |          | Austin           |         |              | TX |              |           |               |             |                   |                 |              | 5,075                   |              |         |  | 45,671  |              |              |  |     |  |           |              | 7,488   |   |               |  | 5,075  |              |             |   | 53,159     |  |          |  | 58,234   |  |  |  | (10,407 | ) |  | 1987             |  | 12/13/91 |  |  | 40 | 
| |  | Westech                          |  |       | (11)    |  |          | Austin           |         |              | TX |              |           |               |             |                   |                 |              | 2,680                   |              |         |  | 25,961  |              |              |  |     |  |           |              | 74      |   |               |  | 2,680  |              |             |   | 26,035     |  |          |  | 28,715   |  |  |  | (67     | ) |  | 1986             |  | 11/19/04 |  |  | 33 | 
| |  | 9400 NCX                         |  |       |         |  |          | Dallas           |         |              | TX |              |           |               |             |                   |                 |              | 3,570                   |              |         |  | 32,130  |              |              |  |     |  |           |              | 6,645   |   |               |  | 3,570  |              |             |   | 38,775     |  |          |  | 42,345   |  |  |  | (9,358  | ) |  | 1981/1995        |  | 06/24/94 |  |  | 40 | 
| |  | Colonnade I & II                 |  |       |         |  |          | Dallas           |         |              | TX |              |           |               |             |                   |                 |              | 9,044                   |              |         |  | 81,394  |              |              |  |     |  |           |              | 7,656   |   |               |  | 9,044  |              |             |   | 89,050     |  |          |  | 98,094   |  |  |  | (16,295 | ) |  | 1983-1985        |  | 09/30/98 |  |  | 40 | 
| |  | Colonnade III                    |  |       |         |  |          | Dallas           |         |              | TX |              |           |               |             |                   |                 |              | 6,152                   |              |         |  | 56,634  |              |              |  |     |  |           |              | 6,084   |   |               |  | 6,152  |              |             |   | 62,718     |  |          |  | 68,870   |  |  |  | (10,874 | ) |  | 1998             |  | 09/30/98 |  |  | 40 | 
| |  | Eighty Eighty Central            |  |       |         |  |          | Dallas           |         |              | TX |              |           |               |             |                   |                 |              | 3,760                   |              |         |  | 33,854  |              |              |  |     |  |           |              | 4,519   |   |               |  | 3,760  |              |             |   | 38,373     |  |          |  | 42,133   |  |  |  | (7,901  | ) |  | 1984             |  | 10/01/97 |  |  | 40 | 
| |  | Four Forest Plaza                |  |       |         |  |          | Dallas           |         |              | TX |              |           |               |             |                   |                 |              | 4,768                   |              |         |  | 42,911  |              |              |  |     |  |           |              | 7,984   |   |               |  | 4,768  |              |             |   | 50,895     |  |          |  | 55,663   |  |  |  | (10,523 | ) |  | 1985             |  | 06/29/89 |  |  | 40 | 
| |  | Lakeside Square                  |  |       |         |  |          | Dallas           |         |              | TX |              |           |               |             |                   |                 |              | 5,262                   |              |         |  | 47,369  |              |              |  | 24   |  |           |              | 6,338   |   |               |  | 5,286  |              |             |   | 53,707     |  |          |  | 58,993   |  |  |  | (9,774  | ) |  | 1987             |  | 11/24/97 |  |  | 40 | 
| |  | North Central Plaza Three        |  |       |         |  |          | Dallas           |         |              | TX |              |           |               |             |                   |                 |              | 3,612                   |              |         |  | 32,689  |              |              |  |     |  |           |              | 5,374   |   |               |  | 3,612  |              |             |   | 38,063     |  |          |  | 41,675   |  |  |  | (7,864  | ) |  | 1986/1994        |  | 04/21/92 |  |  | 40 | 
| |  | 2500 CityWest                    |  |       |         |  |          | Houston          |         |              | TX |              |           |               |             |                   |                 |              | 8,089                   |              |         |  | 72,811  |              |              |  |     |  |           |              | 6,511   |   |               |  | 8,089  |              |             |   | 79,322     |  |          |  | 87,411   |  |  |  | (14,938 | ) |  | 1983             |  | 10/01/97 |  |  | 40 | 
| |  | Brookhollow Central              |  |       |         |  |          | Houston          |         |              | TX |              |           |               |             |                   |                 |              | 7,226                   |              |         |  | 65,053  |              |              |  |     |  |           |              | 9,945   |   |               |  | 7,226  |              |             |   | 74,998     |  |          |  | 82,224   |  |  |  | (15,091 | ) |  | 1979, 1981, 1995 |  | 10/01/97 |  |  | 40 | 
| |  | Intercontinental Center          |  |       |         |  |          | Houston          |         |              | TX |              |           |               |             |                   |                 |              | 1,752                   |              |         |  | 14,420  |              |              |  | 70   |  |           |              | 3,028   |   |               |  | 1,822  |              |             |   | 17,448     |  |          |  | 19,270   |  |  |  | (3,961  | ) |  | 1983/1991        |  | 06/28/89 |  |  | 40 | 
| |  | Northborough Tower               |  |       |         |  |          | Houston          |         |              | TX |              |           |               |             |                   |                 |              | 1,705                   |              |         |  | 12,199  |              |              |  | 37   |  |           |              | 6,188   |   |               |  | 1,742  |              |             |   | 18,387     |  |          |  | 20,129   |  |  |  | (3,696  | ) |  | 1983/1990        |  | 08/03/89 |  |  | 40 | 
| |  | San Felipe Plaza                 |  |       |         |  |          | Houston          |         |              | TX |              |           |               | 48,260       |                   |                 |              | 13,471                  |              |         |  | 117,984 |              |              |  | 20   |  |           |              | 11,760  |   |               |  | 13,491 |              |             |   | 129,744    |  |          |  | 143,235  |  |  |  | (27,257 | ) |  | 1984             |  | 09/29/87 |  |  | 40 | 
| |  | 909 Lake Carolyn Parkway         |  |       | (3)     |  |          | Irving           |         |              | TX |              |           |               |             |                   |                 |              | 5,129                   |              |         |  | 46,164  |              |              |  | 13   |  |           |              | (24,730 | ) |               |  | 5,142  |              |             |   | 21,434     |  |          |  | 26,576   |  |  |  | (941    | ) |  | 1988             |  | 01/07/99 |  |  | 40 | 
| |  | 545 E. John Carpenter Freeway    |  |       | (3)     |  |          | Irving           |         |              | TX |              |           |               |             |                   |                 |              | 5,525                   |              |         |  | 49,728  |              |              |  |     |  |           |              | (25,279 | ) |               |  | 5,525  |              |             |   | 24,449     |  |          |  | 29,974   |  |  |  | (1,100  | ) |  | 1985             |  | 01/07/99 |  |  | 40 | 
| |  | One Lakeway Center               |  |       |         |  |          | Metairie         |         |              | LA |              |           |               |             |                   |                 |              | 2,804                   |              |         |  | 25,235  |              |              |  |     |  |           |              | 4,081   |   |               |  | 2,804  |              |             |   | 29,316     |  |          |  | 32,120   |  |  |  | (6,590  | ) |  | 1981/1996        |  | 11/12/93 |  |  | 40 | 
| |  | Two Lakeway Center               |  |       |         |  |          | Metairie         |         |              | LA |              |           |               |             |                   |                 |              | 4,644                   |              |         |  | 41,792  |              |              |  | 49   |  |           |              | 4,632   |   |               |  | 4,693  |              |             |   | 46,424     |  |          |  | 51,117   |  |  |  | (9,836  | ) |  | 1984/1996        |  | 11/12/93 |  |  | 40 | 
| |  | Three Lakeway Center             |  |       |         |  |          | Metairie         |         |              | LA |              |           |               |             |                   |                 |              | 4,695                   |              |         |  | 43,661  |              |              |  | 59   |  |           |              | 4,359   |   |               |  | 4,754  |              |             |   | 48,020     |  |          |  | 52,774   |  |  |  | (9,873  | ) |  | 1987/1996        |  | 11/12/93 |  |  | 40 | 
| |  | 601 Tchoupitoulas Garage         |  |       |         |  |          | New Orleans      |         |              | LA |              |           |               |             |                   |                 |              | 1,180                   |              |         |  | 10,620  |              |              |  |     |  |           |              | 297     |   |               |  | 1,180  |              |             |   | 10,917     |  |          |  | 12,097   |  |  |  | (2,052  | ) |  | 1982             |  | 09/03/97 |  |  | 40 | 
| |  | LL&E Tower                       |  |       |         |  |          | New Orleans      |         |              | LA |              |           |               |             |                   |                 |              | 6,186                   |              |         |  | 55,672  |              |              |  | 46   |  |           |              | 8,293   |   |               |  | 6,232  |              |             |   | 63,965     |  |          |  | 70,197   |  |  |  | (13,543 | ) |  | 1987             |  | 09/03/97 |  |  | 40 | 
| |  | Texaco Center                    |  |       |         |  |          | New Orleans      |         |              | LA |              |           |               |             |                   |                 |              | 6,686                   |              |         |  | 60,177  |              |              |  | 10   |  |           |              | 6,023   |   |               |  | 6,696  |              |             |   | 66,200     |  |          |  | 72,896   |  |  |  | (13,633 | ) |  | 1984             |  | 09/03/97 |  |  | 40 | 
| |  |                                  |  |       |         |  |          |                  |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          | 
|
| |  | Houston Region Totals            |  |       | 48,260  |  |          |                  | 119,517 |              |    |              | 1,143,462 |               |              |                   | 328             |              |                         |              | 86,832  |  |         |              | 119,845      |  |      |  | 1,230,294 |              |         |   | 1,350,139     |  |        |              | (234,768    | ) |            |  |          |  |          |  |  | 
| |  |                                  |  |       |         |  |          |                  |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |         |   |               |  |        |             
|
| |  | Los Angeles Region               |  |       |         |  |          |                  |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          |  |  |  |         |   |  |                  |  |          |  |  |    | 
| |  | Stadium Towers                   |  |       |         |  |          | Anaheim          |         |              | CA |              |           |               |             |                   |                 |              | 6,683                   |              |         |  | 37,868  |              |              |  |     |  |           |              | 1,604   |   |               |  | 6,683  |              |             |   | 39,472     |  |          |  | 46,155   |  |  |  | (3,739  | ) |  | 1988             |  | 07/02/01 |  |  | 40 | 
| |  | Brea Corporate Place             |  |       |         |  |          | Brea             |         |              | CA |              |           |               |             |                   |                 |              |                        |              |         |  | 35,129  |              |              |  |     |  |           |              | 1,523   |   |               |  |       |              |             |   | 36,652     |  |          |  | 36,652   |  |  |  | (3,418  | ) |  | 1987             |  | 07/02/01 |  |  | 40 | 
| |  | Brea Corporate Plaza             |  |       |         |  |          | Brea             |         |              | CA |              |           |               |             |                   |                 |              | 1,902                   |              |         |  | 10,776  |              |              |  |     |  |           |              | 708     |   |               |  | 1,902  |              |             |   | 11,484     |  |          |  | 13,386   |  |  |  | (1,297  | ) |  | 1982             |  | 07/02/01 |  |  | 40 | 
| |  | Brea Financial Commons           |  |       |         |  |          | Brea             |         |              | CA |              |           |               |             |                   |                 |              | 2,640                   |              |         |  | 14,960  |              |              |  |     |  |           |              | 648     |   |               |  | 2,640  |              |             |   | 15,608     |  |          |  | 18,248   |  |  |  | (1,437  | ) |  | 1982/1989        |  | 07/02/01 |  |  | 40 | 
| |  | Brea Park Centre                 |  |       |         |  |          | Brea             |         |              | CA |              |           |               |             |                   |                 |              | 2,682                   |              |         |  | 15,198  |              |              |  |     |  |           |              | 2,000   |   |               |  | 2,682  |              |             |   | 17,198     |  |          |  | 19,880   |  |  |  | (1,997  | ) |  | 1979-1982,1990   |  | 07/02/01 |  |  | 40 | 
| |  | SunAmerica Center                |  |       | (12)    |  |          | Century City     |         |              | CA |              |           |               | 200,667      |                   |                 |              | 47,863                  |              |         |  | 271,223 |              |              |  |     |  |           |              | 14,754  |   |               |  | 47,863 |              |             |   | 285,977    |  |          |  | 333,840  |  |  |  | (39,267 | ) |  | 1990             |  | 09/07/99 |  |  | 40 | 



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##### Table of Contents



| |  |                                       |  |       |         |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |        |  |               |  |         |              |             |   |            |  |          |  |          |  |  |  |         |   |  |                  |  |          |  |  |    | 
| |  | ------------------------------------- |  | ----- | ------- |  | -------- | ------------- | ------- | ------------ | -- | ------------ | --------- | ------------- | ------------ | ----------------- | --------------- | ------------ | ----------------------- | ------------ | ------- |  | ------- | ------------ | ------------ |  | ---- |  | --------- | ------------ | ------ |  | ------------- |  | ------- | ------------ | ----------- | - | ---------- |  | -------- |  | -------- |  |  |  | ------- | - |  | ---------------- |  | -------- |  |  | -- | 
| |  |                                       |  |       |         |  |          |               |         |              |    |              |           |               |              | Costs Capitalized |                 |              | Gross Amount Carried at |              |         |  |         |              |              |  |      |  |           |             
| |  |                                       |  |       |         |  |          |               |         |              |    |              |           | Subsequent to |              |                   | Close of Period |              |                         |              |         |  |         |              |              |  |      | 
| |  |                                       |  |       |         |  |          |               |         |              |    | Initial Cost |           |               | Acquisition  |                   |                 | 12/31/2004   |                         |              |         |  |         |              |              |  |      |  |          
| |  |                                       |  |       |         |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              | Date of      |  |      |  |          
| |  |                                       |  |       |         |  |          |               |         | Encumbrances |    |              |           |               | Building and |                   |                 |              |                         | Building and |         |  |         |              | Building and |  |      |  |           | Accumulated  |        |  | Construction/ |  | Date    |              | Depreciable |  
| |  | Description                           |  | Notes |         |  | Location |               | State   |              |    | at 12/31/04  |           |               | Land         |                   |                 | Improvements |                         |              | Land    |  |         | Improvements |              |  | Land |  |           | Improvements |        |  | Total(1)      |  |         | Depreciation |             |   | Renovation |  | Acquired |  | Lives(2) | 
| |  |                                       |  |       |         |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |        |  |               |  |         |              |             |   |            |  |          |  |          | 
| |  | Cerritos Towne Center                 |  |       |         |  |          | Cerritos      |         |              | CA |              |           |               |             |                   |                 |              |                        |              |         |  | 60,368  |              |              |  |     |  |           |              | 3,017  |  |               |  |        |              |             |   | 63,385     |  |          |  | 63,385   |  |  |  | (5,882  | ) |  | 1989/1998        |  | 07/02/01 |  |  | 40 | 
| |  | 700 North Brand                       |  |       |         |  |          | Glendale      |         |              | CA |              |           |               | 23,794       |                   |                 |              | 5,970                   |              |         |  | 33,828  |              |              |  |     |  |           |              | 2,501  |  |               |  | 5,970   |              |             |   | 36,329     |  |          |  | 42,299   |  |  |  | (4,853  | ) |  | 1981             |  | 06/19/00 |  |  | 40 | 
| |  | 18301 Von Karman
    (Apple Building) |  |       |         |  |          | Irvine        |         |              | CA |              |           |               |             |                   |                 |              | 6,027                   |              |         |  | 34,152  |              |              |  |     |  |           |              | 1,883  |  |               |  | 6,027   |              |             |   | 36,035     |  |          |  | 42,062   |  |  |  | (4,656  | ) |  | 1991             |  | 06/19/00 |  |  | 40 | 
| |  | 18581 Teller                          |  |       |         |  |          | Irvine        |         |              | CA |              |           |               |             |                   |                 |              | 1,485                   |              |         |  | 8,415   |              |              |  |     |  |           |              | 2,422  |  |               |  | 1,485   |              |             |   | 10,837     |  |          |  | 12,322   |  |  |  | (1,201  | ) |  | 1983             |  | 07/02/01 |  |  | 40 | 
| |  | 2600 Michelson                        |  |       |         |  |          | Irvine        |         |              | CA |              |           |               |             |                   |                 |              | 11,291                  |              |         |  | 63,984  |              |              |  |     |  |           |              | 4,649  |  |               |  | 11,291  |              |             |   | 68,633     |  |          |  | 79,924   |  |  |  | (6,255  | ) |  | 1986             |  | 07/02/01 |  |  | 40 | 
| |  | Fairchild Corporate Center            |  |       |         |  |          | Irvine        |         |              | CA |              |           |               |             |                   |                 |              | 2,363                   |              |         |  | 13,388  |              |              |  |     |  |           |              | 713    |  |               |  | 2,363   |              |             |   | 14,101     |  |          |  | 16,464   |  |  |  | (1,402  | ) |  | 1979             |  | 07/02/01 |  |  | 40 | 
| |  | Inwood Park                           |  |       |         |  |          | Irvine        |         |              | CA |              |           |               |             |                   |                 |              | 3,543                   |              |         |  | 20,079  |              |              |  |     |  |           |              | 926    |  |               |  | 3,543   |              |             |   | 21,005     |  |          |  | 24,548   |  |  |  | (1,971  | ) |  | 1985/1996        |  | 07/02/01 |  |  | 40 | 
| |  | Tower 17                              |  |       |         |  |          | Irvine        |         |              | CA |              |           |               |             |                   |                 |              | 7,562                   |              |         |  | 42,849  |              |              |  |     |  |           |              | 1,787  |  |               |  | 7,562   |              |             |   | 44,636     |  |          |  | 52,198   |  |  |  | (4,183  | ) |  | 1987             |  | 07/02/01 |  |  | 40 | 
| |  | 1920 Main Plaza                       |  |       |         |  |          | Irvine        |         |              | CA |              |           |               |             |                   |                 |              | 5,481                   |              |         |  | 47,526  |              |              |  |     |  |           |              | 3,381  |  |               |  | 5,481   |              |             |   | 50,907     |  |          |  | 56,388   |  |  |  | (11,120 | ) |  | 1988             |  | 09/29/94 |  |  | 40 | 
| |  | 2010 Main Plaza                       |  |       |         |  |          | Irvine        |         |              | CA |              |           |               |             |                   |                 |              | 5,197                   |              |         |  | 46,774  |              |              |  |     |  |           |              | 4,586  |  |               |  | 5,197   |              |             |   | 51,360     |  |          |  | 56,557   |  |  |  | (10,301 | ) |  | 1988             |  | 12/13/94 |  |  | 40 | 
| |  | The Tower in Westwood                 |  |       |         |  |          | Los Angeles   |         |              | CA |              |           |               |             |                   |                 |              | 10,041                  |              |         |  | 56,899  |              |              |  |     |  |           |              | 1,239  |  |               |  | 10,041  |              |             |   | 58,138     |  |          |  | 68,179   |  |  |  | (5,288  | ) |  | 1989             |  | 07/02/01 |  |  | 40 | 
| |  | 10880 Wilshire Boulevard              |  |       |         |  |          | Los Angeles   |         |              | CA |              |           |               |             |                   |                 |              | 28,009                  |              |         |  | 149,841 |              |              |  |     |  |           |              | 10,005 |  |               |  | 28,009  |              |             |   | 159,846    |  |          |  | 187,855  |  |  |  | (30,105 | ) |  | 1970/1992        |  | 12/19/97 |  |  | 40 | 
| |  | 10960 Wilshire Boulevard              |  |       |         |  |          | Los Angeles   |         |              | CA |              |           |               |             |                   |                 |              | 16,841                  |              |         |  | 151,574 |              |              |  |     |  |           |              | 3,874  |  |               |  | 16,841  |              |             |   | 155,448    |  |          |  | 172,289  |  |  |  | (28,000 | ) |  | 1971/1992        |  | 12/19/97 |  |  | 40 | 
| |  | 550 South Hope Street                 |  |       |         |  |          | Los Angeles   |         |              | CA |              |           |               |             |                   |                 |              | 10,016                  |              |         |  | 90,146  |              |              |  |     |  |           |              | 11,166 |  |               |  | 10,016  |              |             |   | 101,312    |  |          |  | 111,328  |  |  |  | (19,135 | ) |  | 1991             |  | 10/06/97 |  |  | 40 | 
| |  | Two California Plaza                  |  |       |         |  |          | Los Angeles   |         |              | CA |              |           |               |             |                   |                 |              |                        |              |         |  | 156,197 |              |              |  |     |  |           |              | 50,717 |  |               |  |        |              |             |   | 206,914    |  |          |  | 206,914  |  |  |  | (51,654 | ) |  | 1992             |  | 08/23/96 |  |  | 40 | 
| |  | Waters Edge                          |  |       |         |  |          | Los Angeles   |         |              | CA |              |           |               |             |                   |                 |              | 16,697                  |              |         |  | 42,853  |              |              |  |     |  |           |              | 10,951 |  |               |  | 16,697  |              |             |   | 53,804     |  |          |  | 70,501   |  |  |  | (2,747  | ) |  | 2002             |  | 06/27/01 |  |  | 40 | 
| |  | 1201 Dove Street                      |  |       |         |  |          | Newport Beach |         |              | CA |              |           |               |             |                   |                 |              | 1,998                   |              |         |  | 11,320  |              |              |  |     |  |           |              | 485    |  |               |  | 1,998   |              |             |   | 11,805     |  |          |  | 13,803   |  |  |  | (1,105  | ) |  | 1975/1989        |  | 07/02/01 |  |  | 40 | 
| |  | Redstone Plaza                        |  |       | (11)    |  |          | Newport Beach |         |              | CA |              |           |               |             |                   |                 |              | 7,000                   |              |         |  | 29,054  |              |              |  |     |  |           |              | 146    |  |               |  | 7,000   |              |             |   | 29,200     |  |          |  | 36,200   |  |  |  | (577    | ) |  | 1976/1995        |  | 09/23/04 |  |  | 35 | 
| |  | The City  3800 Chapman               |  |       |         |  |          | Orange        |         |              | CA |              |           |               |             |                   |                 |              | 3,019                   |              |         |  | 17,107  |              |              |  |     |  |           |              | 239    |  |               |  | 3,019   |              |             |   | 17,346     |  |          |  | 20,365   |  |  |  | (1,513  | ) |  | 1984             |  | 07/02/01 |  |  | 40 | 
| |  | 500 Orange Tower                      |  |       |         |  |          | Orange        |         |              | CA |              |           |               |             |                   |                 |              | 2,943                   |              |         |  | 32,610  |              |              |  |     |  |           |              | 3,430  |  |               |  | 2,943   |              |             |   | 36,040     |  |          |  | 38,983   |  |  |  | (7,205  | ) |  | 1988             |  | 01/01/01 |  |  | 40 | 
| |  | 500-600 City Parkway                  |  |       |         |  |          | Orange        |         |              | CA |              |           |               |             |                   |                 |              | 7,296                   |              |         |  | 41,342  |              |              |  |     |  |           |              | 16,762 |  |               |  | 7,296   |              |             |   | 58,104     |  |          |  | 65,400   |  |  |  | (7,237  | ) |  | 1974, 1978, 1998 |  | 07/02/01 |  |  | 40 | 
| |  | City Plaza                            |  |       |         |  |          | Orange        |         |              | CA |              |           |               |             |                   |                 |              | 6,809                   |              |         |  | 38,584  |              |              |  |     |  |           |              | 4,716  |  |               |  | 6,809   |              |             |   | 43,300     |  |          |  | 50,109   |  |  |  | (4,610  | ) |  | 1970             |  | 07/02/01 |  |  | 40 | 
| |  | City Tower                            |  |       |         |  |          | Orange        |         |              | CA |              |           |               |             |                   |                 |              | 10,440                  |              |         |  | 59,160  |              |              |  |     |  |           |              | 3,695  |  |               |  | 10,440  |              |             |   | 62,855     |  |          |  | 73,295   |  |  |  | (5,836  | ) |  | 1988             |  | 07/02/01 |  |  | 40 | 
| |  | 1100 Executive Tower                  |  |       |         |  |          | Orange        |         |              | CA |              |           |               |             |                   |                 |              | 4,622                   |              |         |  | 41,599  |              |              |  |     |  |           |              | 2,294  |  |               |  | 4,622   |              |             |   | 43,893     |  |          |  | 48,515   |  |  |  | (8,994  | ) |  | 1987             |  | 12/15/94 |  |  | 40 | 
| |  | 3280 E. Foothill Boulevard            |  |       |         |  |          | Pasadena      |         |              | CA |              |           |               |             |                   |                 |              | 3,396                   |              |         |  | 19,246  |              |              |  |     |  |           |              | 1,662  |  |               |  | 3,396   |              |             |   | 20,908     |  |          |  | 24,304   |  |  |  | (2,030  | ) |  | 1982             |  | 07/02/01 |  |  | 40 | 
| |  | 790 Colorado                          |  |       |         |  |          | Pasadena      |         |              | CA |              |           |               |             |                   |                 |              | 2,355                   |              |         |  | 13,343  |              |              |  |     |  |           |              | 2,555  |  |               |  | 2,355   |              |             |   | 15,898     |  |          |  | 18,253   |  |  |  | (1,635  | ) |  | 1981             |  | 07/02/01 |  |  | 40 | 
| |  | Century Square                        |  |       |         |  |          | Pasadena      |         |              | CA |              |           |               |             |                   |                 |              | 6,787                   |              |         |  | 38,457  |              |              |  |     |  |           |              | 342    |  |               |  | 6,787   |              |             |   | 38,799     |  |          |  | 45,586   |  |  |  | (3,344  | ) |  | 1984             |  | 07/02/01 |  |  | 40 | 
| |  | Pasadena Financial                    |  |       |         |  |          | Pasadena      |         |              | CA |              |           |               |             |                   |                 |              | 4,779                   |              |         |  | 27,084  |              |              |  |     |  |           |              | 419    |  |               |  | 4,779   |              |             |   | 27,503     |  |          |  | 32,282   |  |  |  | (2,506  | ) |  | 1984/1996        |  | 07/02/01 |  |  | 40 | 
| |  | Centerside II                         |  |       |         |  |          | San Diego     |         |              | CA |              |           |               | 21,601       |                   |                 |              | 5,777                   |              |         |  | 32,737  |              |              |  |     |  |           |              | 3,019  |  |               |  | 5,777   |              |             |   | 35,756     |  |          |  | 41,533   |  |  |  | (4,306  | ) |  | 1987             |  | 06/19/00 |  |  | 40 | 
| |  | La Jolla Centre I & II                |  |       |         |  |          | San Diego     |         |              | CA |              |           |               |             |                   |                 |              | 12,904                  |              |         |  | 73,122  |              |              |  |     |  |           |              | 3,256  |  |               |  | 12,904  |              |             |   | 76,378     |  |          |  | 89,282   |  |  |  | (7,593  | ) |  | 1986-1989        |  | 07/02/01 |  |  | 40 | 
| |  | La Jolla Executive Tower              |  |       | (11)    |  |          | San Diego     |         |              | CA |              |           |               |             |                   |                 |              | 10,200                  |              |         |  | 60,376  |              |              |  |     |  |           |              |       |  |               |  | 10,200  |              |             |   | 60,376     |  |          |  | 70,576   |  |  |  | (162    | ) |  | 1990             |  | 11/17/04 |  |  | 39 | 
| |  | Nobel Corporate Plaza                 |  |       |         |  |          | San Diego     |         |              | CA |              |           |               |             |                   |                 |              | 3,697                   |              |         |  | 20,948  |              |              |  |     |  |           |              | 846    |  |               |  | 3,697   |              |             |   | 21,794     |  |          |  | 25,491   |  |  |  | (2,015  | ) |  | 1985             |  | 07/02/01 |  |  | 40 | 
| |  | One Pacific Heights                   |  |       |         |  |          | San Diego     |         |              | CA |              |           |               |             |                   |                 |              | 3,072                   |              |         |  | 17,408  |              |              |  |     |  |           |              | 845    |  |               |  | 3,072   |              |             |   | 18,253     |  |          |  | 21,325   |  |  |  | (1,698  | ) |  | 1989             |  | 07/02/01 |  |  | 40 | 
| |  | Pacific Corporate Plaza               |  |       |         |  |          | San Diego     |         |              | CA |              |           |               |             |                   |                 |              | 2,100                   |              |         |  | 11,900  |              |              |  |     |  |           |              | 150    |  |               |  | 2,100   |              |             |   | 12,050     |  |          |  | 14,150   |  |  |  | (1,042  | ) |  | 1988             |  | 07/02/01 |  |  | 40 | 
| |  | Park Plaza                            |  |       |         |  |          | San Diego     |         |              | CA |              |           |               |             |                   |                 |              | 2,203                   |              |         |  | 12,484  |              |              |  |     |  |           |              | 612    |  |               |  | 2,203   |              |             |   | 13,096     |  |          |  | 15,299   |  |  |  | (1,129  | ) |  | 1982             |  | 07/02/01 |  |  | 40 | 
| |  | Westridge                             |  |       |         |  |          | San Diego     |         |              | CA |              |           |               |             |                   |                 |              | 1,500                   |              |         |  | 8,500   |              |              |  |     |  |           |              |       |  |               |  | 1,500   |              |             |   | 8,500      |  |          |  | 10,000   |  |  |  | (735    | ) |  | 1980             |  | 07/02/01 |  |  | 40 | 
| |  | Smith Barney Tower                    |  |       |         |  |          | San Diego     |         |              | CA |              |           |               |             |                   |                 |              | 2,658                   |              |         |  | 23,919  |              |              |  |     |  |           |              | 3,951  |  |               |  | 2,658   |              |             |   | 27,870     |  |          |  | 30,528   |  |  |  | (6,523  | ) |  | 1987             |  | 04/28/97 |  |  | 40 | 
| |  | The Plaza at LaJolla Village          |  |       |         |  |          | San Diego     |         |              | CA |              |           |               | 76,718       |                   |                 |              | 11,839                  |              |         |  | 98,243  |              |              |  | 19   |  |           |              | 4,347  |  |               |  | 11,858  |              |             |   | 102,590    |  |          |  | 114,448  |  |  |  | (20,909 | ) |  | 1987-1990        |  | 03/10/94 |  |  | 40 | 
| |  | Griffin Towers                        |  |       |         |  |          | Santa Ana     |         |              | CA |              |           |               |             |                   |                 |              | 14,317                  |              |         |  | 81,127  |              |              |  |     |  |           |              | 5,038  |  |               |  | 14,317  |              |             |   | 86,165     |  |          |  | 100,482  |  |  |  | (5,783  | ) |  | 1987             |  | 07/02/01 |  |  | 40 | 
| |  | Lincoln Town Center                   |  |       |         |  |          | Santa Ana     |         |              | CA |              |           |               |             |                   |                 |              | 4,403                   |              |         |  | 24,950  |              |              |  |     |  |           |              | 1,972  |  |               |  | 4,403   |              |             |   | 26,922     |  |          |  | 31,325   |  |  |  | (3,337  | ) |  | 1987             |  | 06/19/00 |  |  | 40 | 
| |  | 2951 28th Street                      |  |       |         |  |          | Santa Monica  |         |              | CA |              |           |               |             |                   |                 |              | 3,612                   |              |         |  | 20,465  |              |              |  |     |  |           |              | 2,849  |  |               |  | 3,612   |              |             |   | 23,314     |  |          |  | 26,926   |  |  |  | (2,091  | ) |  | 1971             |  | 07/02/01 |  |  | 40 | 
| |  | 429 Santa Monica                      |  |       |         |  |          | Santa Monica  |         |              | CA |              |           |               |             |                   |                 |              | 2,523                   |              |         |  | 14,298  |              |              |  |     |  |           |              | 1,173  |  |               |  | 2,523   |              |             |   | 15,471     |  |          |  | 17,994   |  |  |  | (1,815  | ) |  | 1982             |  | 06/19/00 |  |  | 40 | 
| |  | Arboretum Courtyard                   |  |       |         |  |          | Santa Monica  |         |              | CA |              |           |               |             |                   |                 |              | 6,573                   |              |         |  | 37,245  |              |              |  |     |  |           |              | 1,438  |  |               |  | 6,573   |              |             |   | 38,683     |  |          |  | 45,256   |  |  |  | (3,530  | ) |  | 1999             |  | 07/02/01 |  |  | 40 | 
| |  | Santa Monica Business Park            |  |       |         |  |          | Santa Monica  |         |              | CA |              |           |               | 7,422        |                   |                 |              |                        |              |         |  | 242,155 |              |              |  |     |  |           |              | 9,559  |  |               |  |        |              |             |   | 251,714    |  |          |  | 251,714  |  |  |  | (22,257 | ) |  | 1979-1981        |  | 07/02/01 |  |  | 40 | 
| |  | Searise Office Tower                  |  |       |         |  |          | Santa Monica  |         |              | CA |              |           |               |             |                   |                 |              | 4,380                   |              |         |  | 24,818  |              |              |  |     |  |           |              | 1,318  |  |               |  | 4,380   |              |             |   | 26,136     |  |          |  | 30,516   |  |  |  | (3,125  | ) |  | 1975             |  | 06/19/00 |  |  | 40 | 
| |  | Wilshire Palisades                    |  |       |         |  |          | Santa Monica  |         |              | CA |              |           |               | 38,900       |                   |                 |              | 9,763                   |              |         |  | 55,323  |              |              |  |     |  |           |              | 2,271  |  |               |  | 9,763   |              |             |   | 57,594     |  |          |  | 67,357   |  |  |  | (6,768  | ) |  | 1981             |  | 06/19/00 |  |  | 40 | 
| |  | Bixby Ranch                           |  |       |         |  |          | Seal Beach    |         |              | CA |              |           |               | 25,535       |                   |                 |              | 6,450                   |              |         |  | 36,550  |              |              |  |     |  |           |              | 2,584  |  |               |  | 6,450   |              |             |   | 39,134     |  |          |  | 45,584   |  |  |  | (4,958  | ) |  | 1987             |  | 06/19/00 |  |  | 40 | 
| |  |                                       |  |       |         |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |        |  |               |  |         |              |             |   |            |  |          |  |          | 
|
| |  | Los Angeles Region Totals             |  |       | 394,637 |  |          |               | 361,708 |              |    |              | 2,669,501 |               |              |                   | 19              |              |                         |              | 217,027 |  |         |              | 361,727      |  |      |  | 2,886,528 |              |        |  | 3,248,255     |  |         |              | (386,276    | ) |            |  |          |  |          |  |  | 
| |  |                                       |  |       |         |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |        |  |               |  |         |             
|
| |  | New York Region                       |  |       |         |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |  |           |              |        |  |               |  |         |              |             |   |            |  |          |  |          |  |  |  |         |   |  |                  |  |          |  |  |    | 
| |  | 1301 Avenue of Americas               |  |       | (13)    |  |          | New York      |         |              | NY |              |           |               | 529,430      |                   |                 |              | 151,285                 |              |         |  | 605,788 |              |              |  |     |  |           |              | 16,434 |  |               |  | 151,285 |              |             |   | 622,222    |  |          |  | 773,507  |  |  |  | (66,133 | ) |  | 1963/1989        |  | 08/03/00 |  |  | 40 | 
| |  | 527 Madison Avenue                    |  |       |         |  |          | New York      |         |              | NY |              |           |               |             |                   |                 |              | 9,155                   |              |         |  | 51,877  |              |              |  |     |  |           |              | 5,932  |  |               |  | 9,155   |              |             |   | 57,809     |  |          |  | 66,964   |  |  |  | (6,766  | ) |  | 1986             |  | 06/19/00 |  |  | 40 | 
| |  | 717 Fifth Avenue                      |  |       | (7)(11) |  |          | New York      |         |              | NY |              |           |               |             |                   |                 |              | 47,000                  |              |         |  | 114,999 |              |              |  |     |  |           |              | 437    |  |               |  | 47,000  |              |             |   | 115,436    |  |          |  | 162,436  |  |  |  | (1,648  | ) |  | 1959             |  | 09/08/04 |  |  | 45 | 
| |  | 850 Third Avenue                      |  |       | (5)     |  |          | New York      |         |              | NY |              |           |               | 2,587        |                   |                 |              | 9,606                   |              |         |  | 86,453  |              |              |  | 30   |  |           |              | 8,815  |  |               |  | 9,636   |              |             |   | 95,268     |  |          |  | 104,904  |  |  |  | (17,837 | ) |  | 1960/1996        |  | 03/20/95 |  |  | 40 | 
| |  | Park Avenue Tower                     |  |       | (5)     |  |          | New York      |         |              | NY |              |           |               | 180,000      |                   |                 |              | 48,976                  |              |         |  | 196,566 |              |              |  | 719  |  |           |              | 12,292 |  |               |  | 49,695  |              |             |   | 208,858    |  |          |  | 258,553  |  |  |  | (34,889 | ) |  | 1986             |  | 07/15/98 |  |  | 40 | 
| |  | Tower 56                              |  |       |         |  |          | New York      |         |              | NY |              |           |               | 22,089       |                   |                 |              | 6,853                   |              |         |  | 38,832  |              |              |  |     |  |           |              | 3,685  |  |               |  | 6,853   |              |             |   | 42,517     |  |          |  | 49,370   |  |  |  | (4,980  | ) |  | 1983             |  | 06/19/00 |  |  | 40 | 
| |  | WorldWide Plaza                       |  |       |         |  |          | New York      |         |              | NY |              |           |               |             |                   |                 |              | 124,919                 |              |         |  | 496,665 |              |              |  |     |  |           |              | 10,288 |  |               |  | 124,919 |              |             |   | 506,953    |  |          |  | 631,872  |  |  |  | (78,221 | ) |  | 1989             |  | 10/01/98 |  |  | 40 | 
| |  | 177 Broad Street                      |  |       |         |  |          | Stamford      |         |              | CT |              |           |               |             |                   |                 |              | 2,562                   |              |         |  | 23,056  |              |              |  |     |  |           |              | 1,524  |  |               |  | 2,562   |              |             |   | 24,580     |  |          |  | 27,142   |  |  |  | (4,850  | ) |  | 1989             |  | 01/29/97 |  |  | 40 | 



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##### Table of Contents



| |  |                                      |  |       |         |  |          |                |         |              |    |              |           |               |              |                   |                 |              |                         |              |        |  |         |              |              |  |      |  |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          |  |  |  |         |   |  |                 |  |          |  |  |    | 
| |  | ------------------------------------ |  | ----- | ------- |  | -------- | -------------- | ------- | ------------ | -- | ------------ | --------- | ------------- | ------------ | ----------------- | --------------- | ------------ | ----------------------- | ------------ | ------ |  | ------- | ------------ | ------------ |  | ---- |  | --------- | ------------ | ------- | - | ------------- |  | ------ | ------------ | ----------- | - | ---------- |  | -------- |  | -------- |  |  |  | ------- | - |  | --------------- |  | -------- |  |  | -- | 
| |  |                                      |  |       |         |  |          |                |         |              |    |              |           |               |              | Costs Capitalized |                 |              | Gross Amount Carried at |              |        |  |         |              |              |  |      |  |           |             
| |  |                                      |  |       |         |  |          |                |         |              |    |              |           | Subsequent to |              |                   | Close of Period |              |                         |              |        |  |         |              |              |  |      | 
| |  |                                      |  |       |         |  |          |                |         |              |    | Initial Cost |           |               | Acquisition  |                   |                 | 12/31/2004   |                         |              |        |  |         |              |              |  |      |  |          
| |  |                                      |  |       |         |  |          |                |         |              |    |              |           |               |              |                   |                 |              |                         |              |        |  |         |              | Date of      |  |      |  |          
| |  |                                      |  |       |         |  |          |                |         | Encumbrances |    |              |           |               | Building and |                   |                 |              |                         | Building and |        |  |         |              | Building and |  |      |  |           | Accumulated  |         |   | Construction/ |  | Date   |              | Depreciable |  
| |  | Description                          |  | Notes |         |  | Location |                | State   |              |    | at 12/31/04  |           |               | Land         |                   |                 | Improvements |                         |              | Land   |  |         | Improvements |              |  | Land |  |           | Improvements |         |   | Total(1)      |  |        | Depreciation |             |   | Renovation |  | Acquired |  | Lives(2) | 
| |  |                                      |  |       |         |  |          |                |         |              |    |              |           |               |              |                   |                 |              |                         |              |        |  |         |              |              |  |      |  |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          | 
| |  | 300 Atlantic Street                  |  |       |         |  |          | Stamford       |         |              | CT |              |           |               |             |                   |                 |              | 4,632                   |              |        |  | 41,691  |              |              |  |     |  |           |              | 3,510   |   |               |  | 4,632  |              |             |   | 45,201     |  |          |  | 49,833   |  |  |  | (8,996  | ) |  | 1987/1996       |  | 03/30/93 |  |  | 40 | 
| |  | Canterbury Green                     |  |       | (4)     |  |          | Stamford       |         |              | CT |              |           |               |             |                   |                 |              |                        |              |        |  | 41,987  |              |              |  | 92   |  |           |              | 1,872   |   |               |  | 92     |              |             |   | 43,859     |  |          |  | 43,951   |  |  |  | (8,941  | ) |  | 1987            |  | 12/15/92 |  |  | 40 | 
| |  | Four Stamford Plaza                  |  |       |         |  |          | Stamford       |         |              | CT |              |           |               |             |                   |                 |              | 4,471                   |              |        |  | 40,238  |              |              |  | 24   |  |           |              | 966     |   |               |  | 4,495  |              |             |   | 41,204     |  |          |  | 45,699   |  |  |  | (7,828  | ) |  | 1979/1994       |  | 08/31/94 |  |  | 40 | 
| |  | One and Two Stamford Plaza           |  |       |         |  |          | Stamford       |         |              | CT |              |           |               |             |                   |                 |              | 8,268                   |              |        |  | 74,409  |              |              |  |     |  |           |              | 6,940   |   |               |  | 8,268  |              |             |   | 81,349     |  |          |  | 89,617   |  |  |  | (17,207 | ) |  | 1986/1994       |  | 03/30/93 |  |  | 40 | 
| |  | Three Stamford Plaza                 |  |       |         |  |          | Stamford       |         |              | CT |              |           |               |             |                   |                 |              | 3,957                   |              |        |  | 35,610  |              |              |  |     |  |           |              | 2,866   |   |               |  | 3,957  |              |             |   | 38,476     |  |          |  | 42,433   |  |  |  | (7,030  | ) |  | 1980/1994       |  | 12/15/92 |  |  | 40 | 
| |  |                                      |  |       |         |  |          |                |         |              |    |              |           |               |              |                   |                 |              |                         |              |        |  |         |              |              |  |      |  |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          | 
|
| |  | New York Region Totals               |  |       | 734,106 |  |          |                | 421,684 |              |    |              | 1,848,171 |               |              |                   | 865             |              |                         |              | 75,561 |  |         |              | 422,549      |  |      |  | 1,923,732 |              |         |   | 2,346,281     |  |        |              | (265,326    | ) |            |  |          |  |          |  |  | 
| |  |                                      |  |       |         |  |          |                |         |              |    |              |           |               |              |                   |                 |              |                         |              |        |  |         |              |              |  |      |  |           |              |         |   |               |  |        |             
|
| |  | San Francisco Region                 |  |       |         |  |          |                |         |              |    |              |           |               |              |                   |                 |              |                         |              |        |  |         |              |              |  |      |  |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          |  |  |  |         |   |  |                 |  |          |  |  |    | 
| |  | Golden Bear Center                   |  |       |         |  |          | Berkeley       |         |              | CA |              |           |               | 18,237       |                   |                 |              | 4,500                   |              |        |  | 25,500  |              |              |  |     |  |           |              | 1,443   |   |               |  | 4,500  |              |             |   | 26,943     |  |          |  | 31,443   |  |  |  | (3,229  | ) |  | 1986            |  | 06/19/00 |  |  | 40 | 
| |  | Sierra Point                         |  |       | (3)     |  |          | Brisbane       |         |              | CA |              |           |               |             |                   |                 |              | 3,198                   |              |        |  | 18,120  |              |              |  |     |  |           |              | (11,108 | ) |               |  | 3,198  |              |             |   | 7,012      |  |          |  | 10,210   |  |  |  | (194    | ) |  | 1979/1983       |  | 07/02/01 |  |  | 40 | 
| |  | Bay Park Plaza I & II                |  |       |         |  |          | Burlingame     |         |              | CA |              |           |               |             |                   |                 |              | 12,906                  |              |        |  | 73,133  |              |              |  |     |  |           |              | 1,983   |   |               |  | 12,906 |              |             |   | 75,116     |  |          |  | 88,022   |  |  |  | (8,705  | ) |  | 1985/1998       |  | 06/19/00 |  |  | 40 | 
| |  | One Bay Plaza                        |  |       |         |  |          | Burlingame     |         |              | CA |              |           |               |             |                   |                 |              | 8,642                   |              |        |  | 48,973  |              |              |  |     |  |           |              | 2,609   |   |               |  | 8,642  |              |             |   | 51,582     |  |          |  | 60,224   |  |  |  | (6,179  | ) |  | 1979            |  | 06/19/00 |  |  | 40 | 
| |  | One & Two Corporate Center           |  |       |         |  |          | Concord        |         |              | CA |              |           |               |             |                   |                 |              | 6,379                   |              |        |  | 36,146  |              |              |  |     |  |           |              | 2,522   |   |               |  | 6,379  |              |             |   | 38,668     |  |          |  | 45,047   |  |  |  | (4,945  | ) |  | 1985-1987       |  | 06/19/00 |  |  | 40 | 
| |  | 5813 Shellmound Street/5855 Christie |  |       |         |  |          | Emeryville     |         |              | CA |              |           |               |             |                   |                 |              | 870                     |              |        |  | 4,930   |              |              |  |     |  |           |              |        |   |               |  | 870    |              |             |   | 4,930      |  |          |  | 5,800    |  |  |  | (426    | ) |  | 1970-1971       |  | 07/02/01 |  |  | 40 | 
| |  | Watergate Office Towers              |  |       |         |  |          | Emeryville     |         |              | CA |              |           |               |             |                   |                 |              | 46,568                  |              |        |  | 263,885 |              |              |  |     |  |           |              | 2,149   |   |               |  | 46,568 |              |             |   | 266,034    |  |          |  | 312,602  |  |  |  | (23,902 | ) |  | 1973/2001       |  | 07/02/01 |  |  | 40 | 
| |  | Bayside Corporate Center             |  |       |         |  |          | Foster City    |         |              | CA |              |           |               |             |                   |                 |              | 2,836                   |              |        |  | 16,069  |              |              |  |     |  |           |              | 960     |   |               |  | 2,836  |              |             |   | 17,029     |  |          |  | 19,865   |  |  |  | (1,616  | ) |  | 1986-1987       |  | 07/02/01 |  |  | 40 | 
| |  | Metro Center                         |  |       |         |  |          | Foster City    |         |              | CA |              |           |               |             |                   |                 |              |                        |              |        |  | 282,329 |              |              |  |     |  |           |              | 6,549   |   |               |  |       |              |             |   | 288,878    |  |          |  | 288,878  |  |  |  | (25,525 | ) |  | 1985-1988       |  | 07/02/01 |  |  | 40 | 
| |  | Parkside Towers                      |  |       |         |  |          | Foster City    |         |              | CA |              |           |               |             |                   |                 |              | 36,000                  |              |        |  | 63,965  |              |              |  |     |  |           |              | 11,725  |   |               |  | 36,000 |              |             |   | 75,690     |  |          |  | 111,690  |  |  |  | (5,323  | ) |  | 2001            |  | 07/02/01 |  |  | 40 | 
| |  | Vintage Industrial Park              |  |       |         |  |          | Foster City    |         |              | CA |              |           |               |             |                   |                 |              | 5,102                   |              |        |  | 28,914  |              |              |  |     |  |           |              | 1,044   |   |               |  | 5,102  |              |             |   | 29,958     |  |          |  | 35,060   |  |  |  | (2,580  | ) |  | 1985-1990       |  | 07/02/01 |  |  | 40 | 
| |  | Vintage Park Office                  |  |       |         |  |          | Foster City    |         |              | CA |              |           |               |             |                   |                 |              | 1,608                   |              |        |  | 9,111   |              |              |  |     |  |           |              | 267     |   |               |  | 1,608  |              |             |   | 9,378      |  |          |  | 10,986   |  |  |  | (1,004  | ) |  | 1985-1990       |  | 07/02/01 |  |  | 40 | 
| |  | Drakes Landing                      |  |       |         |  |          | Larkspur       |         |              | CA |              |           |               |             |                   |                 |              | 5,735                   |              |        |  | 32,499  |              |              |  |     |  |           |              | 1,768   |   |               |  | 5,735  |              |             |   | 34,267     |  |          |  | 40,002   |  |  |  | (3,301  | ) |  | 1986            |  | 07/02/01 |  |  | 40 | 
| |  | Larkspur Landing Office Park         |  |       |         |  |          | Larkspur       |         |              | CA |              |           |               |             |                   |                 |              | 8,316                   |              |        |  | 47,126  |              |              |  |     |  |           |              | 2,835   |   |               |  | 8,316  |              |             |   | 49,961     |  |          |  | 58,277   |  |  |  | (4,718  | ) |  | 1981-1982       |  | 07/02/01 |  |  | 40 | 
| |  | Wood Island Office Complex           |  |       |         |  |          | Larkspur       |         |              | CA |              |           |               |             |                   |                 |              | 3,735                   |              |        |  | 21,163  |              |              |  |     |  |           |              | 408     |   |               |  | 3,735  |              |             |   | 21,571     |  |          |  | 25,306   |  |  |  | (1,911  | ) |  | 1978            |  | 07/02/01 |  |  | 40 | 
| |  | Shoreline Office Center              |  |       | (11)    |  |          | Mill Valley    |         |              | CA |              |           |               |             |                   |                 |              |                        |              |        |  | 19,218  |              |              |  |     |  |           |              | 17      |   |               |  |       |              |             |   | 19,235     |  |          |  | 19,235   |  |  |  | (24     | ) |  | 1985            |  | 12/14/04 |  |  | 40 | 
| |  | Hacienda Terrace                     |  |       |         |  |          | Pleasanton     |         |              | CA |              |           |               |             |                   |                 |              | 7,039                   |              |        |  | 39,887  |              |              |  |     |  |           |              | 6,724   |   |               |  | 7,039  |              |             |   | 46,611     |  |          |  | 53,650   |  |  |  | (5,532  | ) |  | 1984            |  | 06/19/00 |  |  | 40 | 
| |  | Redwood Shores                       |  |       | (3)     |  |          | Redwood City   |         |              | CA |              |           |               |             |                   |                 |              | 4,166                   |              |        |  | 23,608  |              |              |  |     |  |           |              | (16,112 | ) |               |  | 4,166  |              |             |   | 7,496      |  |          |  | 11,662   |  |  |  | (117    | ) |  | 1986            |  | 07/02/01 |  |  | 40 | 
| |  | Seaport Centre                       |  |       |         |  |          | Redwood City   |         |              | CA |              |           |               |             |                   |                 |              | 24,000                  |              |        |  | 136,000 |              |              |  |     |  |           |              | 2,529   |   |               |  | 24,000 |              |             |   | 138,529    |  |          |  | 162,529  |  |  |  | (15,780 | ) |  | 1988            |  | 06/19/00 |  |  | 40 | 
| |  | Seaport Plaza                        |  |       |         |  |          | Redwood City   |         |              | CA |              |           |               |             |                   |                 |              | 10,132                  |              |        |  | 26,108  |              |              |  |     |  |           |              | 3,773   |   |               |  | 10,132 |              |             |   | 29,881     |  |          |  | 40,013   |  |  |  | (2,914  | ) |  | 2000            |  | 06/19/00 |  |  | 40 | 
| |  | Towers@Shore Center                  |  |       |         |  |          | Redwood City   |         |              | CA |              |           |               |             |                   |                 |              | 35,578                  |              |        |  | 69,054  |              |              |  |     |  |           |              | 10,970  |   |               |  | 35,578 |              |             |   | 80,024     |  |          |  | 115,602  |  |  |  | (6,647  | ) |  | 2002            |  | 07/02/01 |  |  | 40 | 
| |  | 555 Twin Dolphin Plaza               |  |       |         |  |          | Redwood Shores |         |              | CA |              |           |               |             |                   |                 |              | 11,790                  |              |        |  | 66,810  |              |              |  |     |  |           |              | 3,181   |   |               |  | 11,790 |              |             |   | 69,991     |  |          |  | 81,781   |  |  |  | (6,530  | ) |  | 1989            |  | 07/02/01 |  |  | 40 | 
| |  | Douglas Corporate Center             |  |       |         |  |          | Roseville      |         |              | CA |              |           |               |             |                   |                 |              | 2,391                   |              |        |  | 13,550  |              |              |  |     |  |           |              | 355     |   |               |  | 2,391  |              |             |   | 13,905     |  |          |  | 16,296   |  |  |  | (1,205  | ) |  | 1990            |  | 07/02/01 |  |  | 40 | 
| |  | Douglas Corporate Center II          |  |       | (6)     |  |          | Roseville      |         |              | CA |              |           |               |             |                   |                 |              | 1,700                   |              |        |  | 10,962  |              |              |  |     |  |           |              | 3,688   |   |               |  | 1,700  |              |             |   | 14,650     |  |          |  | 16,350   |  |  |  | (472    | ) |  | 2004            |  | 07/02/01 |  |  | 40 | 
| |  | Johnson Ranch Corp Centre I & II     |  |       |         |  |          | Roseville      |         |              | CA |              |           |               |             |                   |                 |              | 4,380                   |              |        |  | 24,819  |              |              |  |     |  |           |              | 367     |   |               |  | 4,380  |              |             |   | 25,186     |  |          |  | 29,566   |  |  |  | (2,235  | ) |  | 1990-1998       |  | 07/02/01 |  |  | 40 | 
| |  | Olympus Corporate Centre             |  |       | (11)    |  |          | Roseville      |         |              | CA |              |           |               |             |                   |                 |              | 7,510                   |              |        |  | 30,456  |              |              |  |     |  |           |              | 1       |   |               |  | 7,510  |              |             |   | 30,457     |  |          |  | 37,967   |  |  |  | (488    | ) |  | 1992-1996       |  | 09/22/04 |  |  | 40 | 
| |  | Roseville Corporate Center           |  |       |         |  |          | Roseville      |         |              | CA |              |           |               |             |                   |                 |              | 3,008                   |              |        |  | 17,046  |              |              |  |     |  |           |              | 64      |   |               |  | 3,008  |              |             |   | 17,110     |  |          |  | 20,118   |  |  |  | (1,476  | ) |  | 1999            |  | 07/02/01 |  |  | 40 | 
| |  | 3600-3620 American River Drive       |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 2,209                   |              |        |  | 12,518  |              |              |  |     |  |           |              | 1,242   |   |               |  | 2,209  |              |             |   | 13,760     |  |          |  | 15,969   |  |  |  | (1,236  | ) |  | 1977-1979/ 1997 |  | 07/02/01 |  |  | 40 | 
| |  | 455 University Avenue                |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 465                     |              |        |  | 2,634   |              |              |  |     |  |           |              | 197     |   |               |  | 465    |              |             |   | 2,831      |  |          |  | 3,296    |  |  |  | (286    | ) |  | 1973            |  | 07/02/01 |  |  | 40 | 
| |  | 555 University Avenue                |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 939                     |              |        |  | 5,323   |              |              |  |     |  |           |              | 324     |   |               |  | 939    |              |             |   | 5,647      |  |          |  | 6,586    |  |  |  | (495    | ) |  | 1974            |  | 07/02/01 |  |  | 40 | 
| |  | 575 & 601 University Avenue          |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 1,159                   |              |        |  | 6,569   |              |              |  |     |  |           |              | 762     |   |               |  | 1,159  |              |             |   | 7,331      |  |          |  | 8,490    |  |  |  | (660    | ) |  | 1977            |  | 07/02/01 |  |  | 40 | 
| |  | 655 University Avenue                |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 672                     |              |        |  | 3,806   |              |              |  |     |  |           |              | 544     |   |               |  | 672    |              |             |   | 4,350      |  |          |  | 5,022    |  |  |  | (409    | ) |  | 1979            |  | 07/02/01 |  |  | 40 | 
| |  | 701 University Avenue                |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 934                     |              |        |  | 5,294   |              |              |  |     |  |           |              | 242     |   |               |  | 934    |              |             |   | 5,536      |  |          |  | 6,470    |  |  |  | (520    | ) |  | 1990            |  | 07/02/01 |  |  | 40 | 
| |  | 740 University Avenue                |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 212                     |              |        |  | 1,199   |              |              |  |     |  |           |              | 59      |   |               |  | 212    |              |             |   | 1,258      |  |          |  | 1,470    |  |  |  | (116    | ) |  | 1973            |  | 07/02/01 |  |  | 40 | 
| |  | Exposition Centre                    |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 1,200                   |              |        |  | 7,800   |              |              |  |     |  |           |              | 506     |   |               |  | 1,200  |              |             |   | 8,306      |  |          |  | 9,506    |  |  |  | (1,057  | ) |  | 1984            |  | 06/19/00 |  |  | 40 | 
| |  | Gateway Oaks I                       |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 2,391                   |              |        |  | 13,546  |              |              |  |     |  |           |              | 609     |   |               |  | 2,391  |              |             |   | 14,155     |  |          |  | 16,546   |  |  |  | (1,277  | ) |  | 1990            |  | 07/02/01 |  |  | 40 | 
| |  | Gateway Oaks II                      |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 1,341                   |              |        |  | 7,600   |              |              |  |     |  |           |              | 348     |   |               |  | 1,341  |              |             |   | 7,948      |  |          |  | 9,289    |  |  |  | (783    | ) |  | 1992            |  | 07/02/01 |  |  | 40 | 
| |  | Gateway Oaks III                     |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 936                     |              |        |  | 5,305   |              |              |  |     |  |           |              | 169     |   |               |  | 936    |              |             |   | 5,474      |  |          |  | 6,410    |  |  |  | (532    | ) |  | 1996            |  | 07/02/01 |  |  | 40 | 
| |  | Gateway Oaks IV                      |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 1,658                   |              |        |  | 9,395   |              |              |  |     |  |           |              | 409     |   |               |  | 1,658  |              |             |   | 9,804      |  |          |  | 11,462   |  |  |  | (849    | ) |  | 1998            |  | 07/02/01 |  |  | 40 | 
| |  | Point West Commercentre              |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 2,321                   |              |        |  | 13,154  |              |              |  |     |  |           |              | 1,121   |   |               |  | 2,321  |              |             |   | 14,275     |  |          |  | 16,596   |  |  |  | (1,437  | ) |  | 1983            |  | 07/02/01 |  |  | 40 | 
| |  | Point West Corporate Center I & II   |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 3,653                   |              |        |  | 14,779  |              |              |  |     |  |           |              | 1,106   |   |               |  | 3,653  |              |             |   | 15,885     |  |          |  | 19,538   |  |  |  | (1,482  | ) |  | 1984            |  | 07/02/01 |  |  | 40 | 
| |  | Point West I  Response Road         |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 774                     |              |        |  | 4,384   |              |              |  |     |  |           |              | 467     |   |               |  | 774    |              |             |   | 4,851      |  |          |  | 5,625    |  |  |  | (462    | ) |  | 1976            |  | 07/02/01 |  |  | 40 | 
| |  | Point West III  River Park Dr.      |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 1,141                   |              |        |  | 6,467   |              |              |  |     |  |           |              | 897     |   |               |  | 1,141  |              |             |   | 7,364      |  |          |  | 8,505    |  |  |  | (802    | ) |  | 1978            |  | 07/02/01 |  |  | 40 | 
| |  | The Orchard                          |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 1,226                   |              |        |  | 6,948   |              |              |  |     |  |           |              | 625     |   |               |  | 1,226  |              |             |   | 7,573      |  |          |  | 8,799    |  |  |  | (689    | ) |  | 1987            |  | 07/02/01 |  |  | 40 | 
| |  | Wells Fargo Center                   |  |       |         |  |          | Sacramento     |         |              | CA |              |           |               |             |                   |                 |              | 17,819                  |              |        |  | 100,975 |              |              |  |     |  |           |              | 3,757   |   |               |  | 17,819 |              |             |   | 104,732    |  |          |  | 122,551  |  |  |  | (12,171 | ) |  | 1987            |  | 06/19/00 |  |  | 40 | 
| |  | Bayhill Office Center                |  |       |         |  |          | San Bruno      |         |              | CA |              |           |               | 87,331       |                   |                 |              | 24,010                  |              |        |  | 136,055 |              |              |  |     |  |           |              | 5,795   |   |               |  | 24,010 |              |             |   | 141,850    |  |          |  | 165,860  |  |  |  | (16,316 | ) |  | 1982/1987       |  | 06/19/00 |  |  | 40 | 
| |  | Skyway Landing I & II                |  |       |         |  |          | San Carlos     |         |              | CA |              |           |               |             |                   |                 |              | 15,535                  |              |        |  | 35,994  |              |              |  |     |  |           |              | 18,658  |   |               |  | 15,535 |              |             |   | 54,652     |  |          |  | 70,187   |  |  |  | (5,069  | ) |  | 2000            |  | 07/02/01 |  |  | 40 | 
| |  | 120 Montgomery                       |  |       |         |  |          | San Francisco  |         |              | CA |              |           |               |             |                   |                 |              | 17,564                  |              |        |  | 99,532  |              |              |  |     |  |           |              | 4,048   |   |               |  | 17,564 |              |             |   | 103,580    |  |          |  | 121,144  |  |  |  | (12,008 | ) |  | 1956            |  | 06/19/00 |  |  | 40 | 
| |  | 150 California                       |  |       |         |  |          | San Francisco  |         |              | CA |              |           |               |             |                   |                 |              | 12,567                  |              |        |  | 46,184  |              |              |  |     |  |           |              | 6,475   |   |               |  | 12,567 |              |             |   | 52,659     |  |          |  | 65,226   |  |  |  | (7,300  | ) |  | 2000            |  | 12/19/97 |  |  | 40 | 
| |  | 201 California                       |  |       |         |  |          | San Francisco  |         |              | CA |              |           |               | 38,984       |                   |                 |              | 10,520                  |              |        |  | 59,611  |              |              |  |     |  |           |              | 5,864   |   |               |  | 10,520 |              |             |   | 65,475     |  |          |  | 75,995   |  |  |  | (7,480  | ) |  | 1980            |  | 06/19/00 |  |  | 40 | 
| |  | 188 Embarcadero                      |  |       |         |  |          | San Francisco  |         |              | CA |              |           |               | 13,970       |                   |                 |              | 4,108                   |              |        |  | 23,280  |              |              |  |     |  |           |              | 1,763   |   |               |  | 4,108  |              |             |   | 25,043     |  |          |  | 29,151   |  |  |  | (2,951  | ) |  | 1985            |  | 06/19/00 |  |  | 40 | 



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##### Table of Contents



| |  |                             |  |       |         |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |   |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          |  |  |  |         |   |  |           |  |          |  |  |    | 
| |  | --------------------------- |  | ----- | ------- |  | -------- | ------------- | ------- | ------------ | -- | ------------ | --------- | ------------- | ------------ | ----------------- | --------------- | ------------ | ----------------------- | ------------ | ------- |  | ------- | ------------ | ------------ |  | ---- | - | --------- | ------------ | ------- | - | ------------- |  | ------ | ------------ | ----------- | - | ---------- |  | -------- |  | -------- |  |  |  | ------- | - |  | --------- |  | -------- |  |  | -- | 
| |  |                             |  |       |         |  |          |               |         |              |    |              |           |               |              | Costs Capitalized |                 |              | Gross Amount Carried at |              |         |  |         |              |              |  |      |   |           |             
| |  |                             |  |       |         |  |          |               |         |              |    |              |           | Subsequent to |              |                   | Close of Period |              |                         |              |         |  |         |              |              |  |      |  
| |  |                             |  |       |         |  |          |               |         |              |    | Initial Cost |           |               | Acquisition  |                   |                 | 12/31/2004   |                         |              |         |  |         |              |              |  |      |   |          
| |  |                             |  |       |         |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              | Date of      |  |      |   |          
| |  |                             |  |       |         |  |          |               |         | Encumbrances |    |              |           |               | Building and |                   |                 |              |                         | Building and |         |  |         |              | Building and |  |      |   |           | Accumulated  |         |   | Construction/ |  | Date   |              | Depreciable |  
| |  | Description                 |  | Notes |         |  | Location |               | State   |              |    | at 12/31/04  |           |               | Land         |                   |                 | Improvements |                         |              | Land    |  |         | Improvements |              |  | Land |   |           | Improvements |         |   | Total(1)      |  |        | Depreciation |             |   | Renovation |  | Acquired |  | Lives(2) | 
| |  |                             |  |       |         |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |   |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          | 
| |  | 201 Mission Street          |  |       |         |  |          | San Francisco |         |              | CA |              |           |               |             |                   |                 |              | 8,871                   |              |         |  | 79,837  |              |              |  |     |   |           |              | 6,409   |   |               |  | 8,871  |              |             |   | 86,246     |  |          |  | 95,117   |  |  |  | (16,373 | ) |  | 1981      |  | 04/30/97 |  |  | 40 | 
| |  | 301 Howard Street           |  |       |         |  |          | San Francisco |         |              | CA |              |           |               |             |                   |                 |              | 7,051                   |              |         |  | 58,920  |              |              |  |     |   |           |              | 5,392   |   |               |  | 7,051  |              |             |   | 64,312     |  |          |  | 71,363   |  |  |  | (11,843 | ) |  | 1988      |  | 04/29/98 |  |  | 40 | 
| |  | 580 California              |  |       |         |  |          | San Francisco |         |              | CA |              |           |               |             |                   |                 |              | 7,491                   |              |         |  | 67,421  |              |              |  | 9    |   |           |              | 4,409   |   |               |  | 7,500  |              |             |   | 71,830     |  |          |  | 79,330   |  |  |  | (14,631 | ) |  | 1984      |  | 12/21/95 |  |  | 40 | 
| |  | 60 Spear Street             |  |       |         |  |          | San Francisco |         |              | CA |              |           |               |             |                   |                 |              | 2,125                   |              |         |  | 19,126  |              |              |  | 15   |   |           |              | 4,042   |   |               |  | 2,140  |              |             |   | 23,168     |  |          |  | 25,308   |  |  |  | (4,409  | ) |  | 1967/1987 |  | 09/29/87 |  |  | 40 | 
| |  | Maritime Plaza              |  |       |         |  |          | San Francisco |         |              | CA |              |           |               |             |                   |                 |              | 11,531                  |              |         |  | 103,776 |              |              |  |     |   |           |              | 21,490  |   |               |  | 11,531 |              |             |   | 125,266    |  |          |  | 136,797  |  |  |  | (23,682 | ) |  | 1967/1990 |  | 04/21/97 |  |  | 40 | 
| |  | One Market                  |  |       |         |  |          | San Francisco |         |              | CA |              |           |               | 173,544      |                   |                 |              | 34,814                  |              |         |  | 313,330 |              |              |  |     |   |           |              | 46,311  |   |               |  | 34,814 |              |             |   | 359,641    |  |          |  | 394,455  |  |  |  | (78,341 | ) |  | 1976/1995 |  | 11/22/94 |  |  | 40 | 
| |  | Ferry Building              |  |       |         |  |          | San Francisco |         |              | CA |              |           |               |             |                   |                 |              |                        |              |         |  | 94,652  |              |              |  |     |   |           |              | 16,994  |   |               |  |       |              |             |   | 111,646    |  |          |  | 111,646  |  |  |  | (5,668  | ) |  | 1898/2002 |  | 06/19/00 |  |  | 40 | 
| |  | Foundry Square II           |  |       |         |  |          | San Francisco |         |              | CA |              |           |               |             |                   |                 |              | 14,391                  |              |         |  | 122,575 |              |              |  |     |   |           |              | 18,305  |   |               |  | 14,391 |              |             |   | 140,880    |  |          |  | 155,271  |  |  |  | (6,745  | ) |  | 2002      |  | 06/19/00 |  |  | 40 | 
| |  | Concar                      |  |       | (14)    |  |          | San Mateo     |         |              | CA |              |           |               |             |                   |                 |              |                        |              |         |  | 53,330  |              |              |  |     |   |           |              | 59      |   |               |  |       |              |             |   | 53,389     |  |          |  | 53,389   |  |  |  | (2,615  | ) |  | 2002      |  | 06/19/00 |  |  | 40 | 
| |  | Peninsula Office Park       |  |       |         |  |          | San Mateo     |         |              | CA |              |           |               | 78,174       |                   |                 |              | 27,275                  |              |         |  | 154,561 |              |              |  |     |   |           |              | 4,126   |   |               |  | 27,275 |              |             |   | 158,687    |  |          |  | 185,962  |  |  |  | (18,374 | ) |  | 1971/1998 |  | 06/19/00 |  |  | 40 | 
| |  | San Mateo BayCenter I       |  |       |         |  |          | San Mateo     |         |              | CA |              |           |               |             |                   |                 |              | 5,382                   |              |         |  | 30,498  |              |              |  |     |   |           |              | 1,044   |   |               |  | 5,382  |              |             |   | 31,542     |  |          |  | 36,924   |  |  |  | (2,888  | ) |  | 1984      |  | 07/02/01 |  |  | 40 | 
| |  | San Mateo BayCenter II      |  |       |         |  |          | San Mateo     |         |              | CA |              |           |               | 9,601        |                   |                 |              | 6,245                   |              |         |  | 35,389  |              |              |  |     |   |           |              | 1,883   |   |               |  | 6,245  |              |             |   | 37,272     |  |          |  | 43,517   |  |  |  | (3,325  | ) |  | 1984      |  | 07/02/01 |  |  | 40 | 
| |  | San Mateo BayCenter III     |  |       |         |  |          | San Mateo     |         |              | CA |              |           |               |             |                   |                 |              | 3,357                   |              |         |  | 19,023  |              |              |  |     |   |           |              | 307     |   |               |  | 3,357  |              |             |   | 19,330     |  |          |  | 22,687   |  |  |  | (1,708  | ) |  | 1987      |  | 07/02/01 |  |  | 40 | 
| |  | San Rafael Corporate Center |  |       |         |  |          | San Rafael    |         |              | CA |              |           |               |             |                   |                 |              | 18,002                  |              |         |  | 27,029  |              |              |  |     |   |           |              | 2,828   |   |               |  | 18,002 |              |             |   | 29,857     |  |          |  | 47,859   |  |  |  | (2,344  | ) |  | 2002      |  | 07/02/01 |  |  | 40 | 
| |  | Norris Tech Center          |  |       |         |  |          | San Ramon     |         |              | CA |              |           |               |             |                   |                 |              | 5,700                   |              |         |  | 32,300  |              |              |  |     |   |           |              | 2,518   |   |               |  | 5,700  |              |             |   | 34,818     |  |          |  | 40,518   |  |  |  | (4,553  | ) |  | 1984/1990 |  | 06/19/00 |  |  | 40 | 
| |  | The Plaza at San Ramon      |  |       |         |  |          | San Ramon     |         |              | CA |              |           |               |             |                   |                 |              | 7,460                   |              |         |  | 42,273  |              |              |  |     |   |           |              | 6,289   |   |               |  | 7,460  |              |             |   | 48,562     |  |          |  | 56,022   |  |  |  | (5,822  | ) |  | 1987-1989 |  | 06/19/00 |  |  | 40 | 
| |  | Fountaingrove Center        |  |       |         |  |          | Santa Rosa    |         |              | CA |              |           |               |             |                   |                 |              | 2,898                   |              |         |  | 16,424  |              |              |  |     |   |           |              | 2,374   |   |               |  | 2,898  |              |             |   | 18,798     |  |          |  | 21,696   |  |  |  | (1,641  | ) |  | 1986/1991 |  | 07/02/01 |  |  | 40 | 
| |  |                             |  |       |         |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |   |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          | 
|
| |  | San Francisco Region Totals |  |       | 419,841 |  |          |               | 546,036 |              |    |              | 3,348,197 |               |              |                   | 24              |              |                         |              | 241,478 |  |         |              | 546,060      |  |      |   | 3,589,675 |              |         |   | 4,135,735     |  |        |              | (418,327    | ) |            |  |          |  |          |  |  | 
| |  |                             |  |       |         |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |   |           |              |         |   |               |  |        |             
|
| |  | San Jose Region             |  |       |         |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |  |         |              |              |  |      |   |           |              |         |   |               |  |        |              |             |   |            |  |          |  |          |  |  |  |         |   |  |           |  |          |  |  |    | 
| |  | Pruneyard Office Towers     |  |       |         |  |          | Campbell      |         |              | CA |              |           |               |             |                   |                 |              | 16,502                  |              |         |  | 154,783 |              |              |  |     |   |           |              | 8,369   |   |               |  | 16,502 |              |             |   | 163,152    |  |          |  | 179,654  |  |  |  | (19,029 | ) |  | 1971/1999 |  | 06/19/00 |  |  | 40 | 
| |  | Cupertino Business Center   |  |       | (3)     |  |          | Cupertino     |         |              | CA |              |           |               |             |                   |                 |              | 2,910                   |              |         |  | 16,490  |              |              |  | (28  | ) |           |              | (9,991  | ) |               |  | 2,882  |              |             |   | 6,499      |  |          |  | 9,381    |  |  |  | (266    | ) |  | 1974-1975 |  | 07/02/01 |  |  | 40 | 
| |  | 1900 McCarthy               |  |       |         |  |          | Milpitas      |         |              | CA |              |           |               |             |                   |                 |              | 1,998                   |              |         |  | 11,319  |              |              |  |     |   |           |              | 641     |   |               |  | 1,998  |              |             |   | 11,960     |  |          |  | 13,958   |  |  |  | (1,076  | ) |  | 1984      |  | 07/02/01 |  |  | 40 | 
| |  | California Circle II        |  |       |         |  |          | Milpitas      |         |              | CA |              |           |               |             |                   |                 |              | 1,764                   |              |         |  | 9,997   |              |              |  |     |   |           |              | 477     |   |               |  | 1,764  |              |             |   | 10,474     |  |          |  | 12,238   |  |  |  | (1,044  | ) |  | 1984      |  | 07/02/01 |  |  | 40 | 
| |  | Oak Creek I & II            |  |       | (3)     |  |          | Milpitas      |         |              | CA |              |           |               |             |                   |                 |              | 1,309                   |              |         |  | 7,417   |              |              |  |     |   |           |              | (3,034  | ) |               |  | 1,309  |              |             |   | 4,383      |  |          |  | 5,692    |  |  |  | (76     | ) |  | 1982      |  | 07/02/01 |  |  | 40 | 
| |  | Shoreline Technology Park   |  |       |         |  |          | Mountain View |         |              | CA |              |           |               |             |                   |                 |              | 31,575                  |              |         |  | 190,894 |              |              |  | 69   |   |           |              | 13,637  |   |               |  | 31,644 |              |             |   | 204,531    |  |          |  | 236,175  |  |  |  | (34,785 | ) |  | 1985/1991 |  | 12/19/97 |  |  | 40 | 
| |  | Meier Mountain View         |  |       | (3)     |  |          | Mountain View |         |              | CA |              |           |               |             |                   |                 |              | 13,950                  |              |         |  | 79,050  |              |              |  |     |   |           |              | (52,260 | ) |               |  | 13,950 |              |             |   | 26,790     |  |          |  | 40,740   |  |  |  | (494    | ) |  | 1972/1980 |  | 07/02/01 |  |  | 40 | 
| |  | Ravendale at Central        |  |       | (3)     |  |          | Mountain View |         |              | CA |              |           |               |             |                   |                 |              | 2,550                   |              |         |  | 14,450  |              |              |  |     |   |           |              | (4,772  | ) |               |  | 2,550  |              |             |   | 9,678      |  |          |  | 12,228   |  |  |  | (186    | ) |  | 1980      |  | 07/02/01 |  |  | 40 | 
| |  | 2180 Sand Hill Road         |  |       |         |  |          | Menlo Park    |         |              | CA |              |           |               |             |                   |                 |              | 3,408                   |              |         |  | 19,314  |              |              |  |     |   |           |              | 1,693   |   |               |  | 3,408  |              |             |   | 21,007     |  |          |  | 24,415   |  |  |  | (1,969  | ) |  | 1976      |  | 07/02/01 |  |  | 40 | 
| |  | Embarcadero Place           |  |       |         |  |          | Palo Alto     |         |              | CA |              |           |               | 33,847       |                   |                 |              | 10,500                  |              |         |  | 59,500  |              |              |  |     |   |           |              | 2,552   |   |               |  | 10,500 |              |             |   | 62,052     |  |          |  | 72,552   |  |  |  | (6,994  | ) |  | 1984      |  | 06/19/00 |  |  | 40 | 
| |  | Palo Alto Square            |  |       |         |  |          | Palo Alto     |         |              | CA |              |           |               |             |                   |                 |              |                        |              |         |  | 78,143  |              |              |  | 161  |   |           |              | 4,656   |   |               |  | 161    |              |             |   | 82,799     |  |          |  | 82,960   |  |  |  | (16,732 | ) |  | 1971/1985 |  | 10/01/99 |  |  | 23 | 
| |  | Xerox Campus                |  |       |         |  |          | Palo Alto     |         |              | CA |              |           |               |             |                   |                 |              |                        |              |         |  | 132,810 |              |              |  |     |   |           |              |        |   |               |  |       |              |             |   | 132,810    |  |          |  | 132,810  |  |  |  | (11,777 | ) |  | 1991      |  | 07/02/01 |  |  | 40 | 
| |  | Foothill Research Center    |  |       |         |  |          | Palo Alto     |         |              | CA |              |           |               |             |                   |                 |              |                        |              |         |  | 104,894 |              |              |  |     |   |           |              | 53      |   |               |  |       |              |             |   | 104,947    |  |          |  | 104,947  |  |  |  | (9,548  | ) |  | 1991      |  | 07/02/01 |  |  | 40 | 
| |  | Lockheed                    |  |       |         |  |          | Palo Alto     |         |              | CA |              |           |               |             |                   |                 |              |                        |              |         |  | 27,712  |              |              |  |     |   |           |              | 70      |   |               |  |       |              |             |   | 27,782     |  |          |  | 27,782   |  |  |  | (2,471  | ) |  | 1991      |  | 07/02/01 |  |  | 40 | 
| |  | 10 Almaden                  |  |       |         |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 12,583                  |              |         |  | 71,303  |              |              |  |     |   |           |              | 2,090   |   |               |  | 12,583 |              |             |   | 73,393     |  |          |  | 85,976   |  |  |  | (8,371  | ) |  | 1989      |  | 06/19/00 |  |  | 40 | 
| |  | 1740 Technology             |  |       |         |  |          | San Jose      |         |              | CA |              |           |               | 15,980       |                   |                 |              | 8,766                   |              |         |  | 49,673  |              |              |  |     |   |           |              | 2,161   |   |               |  | 8,766  |              |             |   | 51,834     |  |          |  | 60,600   |  |  |  | (4,732  | ) |  | 1986/1994 |  | 07/02/01 |  |  | 40 | 
| |  | 2290 North First Street     |  |       | (3)     |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 2,431                   |              |         |  | 13,776  |              |              |  |     |   |           |              | (7,411  | ) |               |  | 2,431  |              |             |   | 6,365      |  |          |  | 8,796    |  |  |  | (384    | ) |  | 1984      |  | 07/02/01 |  |  | 40 | 
| |  | Aspect Telecommunications   |  |       | (3)     |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 2,925                   |              |         |  | 16,575  |              |              |  |     |   |           |              | (5,196  | ) |               |  | 2,925  |              |             |   | 11,379     |  |          |  | 14,304   |  |  |  | (203    | ) |  | 1989      |  | 07/02/01 |  |  | 40 | 
| |  | Central Park Plaza          |  |       |         |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 11,181                  |              |         |  | 63,358  |              |              |  | 23   |   |           |              | 2,937   |   |               |  | 11,204 |              |             |   | 66,295     |  |          |  | 77,499   |  |  |  | (6,535  | ) |  | 1984-1985 |  | 07/02/01 |  |  | 40 | 
| |  | Metro Plaza                 |  |       |         |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 18,029                  |              |         |  | 102,164 |              |              |  |     |   |           |              | 5,439   |   |               |  | 18,029 |              |             |   | 107,603    |  |          |  | 125,632  |  |  |  | (9,485  | ) |  | 1986-1987 |  | 07/02/01 |  |  | 40 | 
| |  | Ridder Park                 |  |       |         |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 2,012                   |              |         |  | 11,402  |              |              |  |     |   |           |              |        |   |               |  | 2,012  |              |             |   | 11,402     |  |          |  | 13,414   |  |  |  | (986    | ) |  | 1966      |  | 07/02/01 |  |  | 40 | 
| |  | Skyport East and West       |  |       |         |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 6,779                   |              |         |  | 87,193  |              |              |  |     |   |           |              | 26,368  |   |               |  | 6,779  |              |             |   | 113,561    |  |          |  | 120,340  |  |  |  | (12,471 | ) |  | 2001      |  | 07/02/01 |  |  | 40 | 
| |  | Concourse                   |  |       |         |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 49,279                  |              |         |  | 279,248 |              |              |  | (50  | ) |           |              | 5,795   |   |               |  | 49,229 |              |             |   | 285,043    |  |          |  | 334,272  |  |  |  | (25,183 | ) |  | 1980/2000 |  | 07/02/01 |  |  | 40 | 
| |  | Creekside                   |  |       | (3)     |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 9,631                   |              |         |  | 54,576  |              |              |  |     |   |           |              | (20,749 | ) |               |  | 9,631  |              |             |   | 33,827     |  |          |  | 43,458   |  |  |  | (703    | ) |  | 1986      |  | 07/02/01 |  |  | 40 | 
| |  | San Jose Gateway Office II  |  |       |         |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 16,286                  |              |         |  | 92,288  |              |              |  |     |   |           |              | 3,332   |   |               |  | 16,286 |              |             |   | 95,620     |  |          |  | 111,906  |  |  |  | (8,313  | ) |  | 1983-1984 |  | 07/02/01 |  |  | 40 | 
| |  | San Jose Gateway Office III |  |       |         |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 6,409                   |              |         |  | 36,315  |              |              |  |     |   |           |              | 335     |   |               |  | 6,409  |              |             |   | 36,650     |  |          |  | 43,059   |  |  |  | (3,162  | ) |  | 1998      |  | 07/02/01 |  |  | 40 | 
| |  | North First Office Center   |  |       |         |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 6,395                   |              |         |  | 36,239  |              |              |  |     |   |           |              | 331     |   |               |  | 6,395  |              |             |   | 36,570     |  |          |  | 42,965   |  |  |  | (3,156  | ) |  | 1985-1986 |  | 07/02/01 |  |  | 40 | 
| |  | San Jose Gateway            |  |       |         |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 7,873                   |              |         |  | 44,616  |              |              |  |     |   |           |              | 3,693   |   |               |  | 7,873  |              |             |   | 48,309     |  |          |  | 56,182   |  |  |  | (4,309  | ) |  | 1981      |  | 07/02/01 |  |  | 40 | 
| |  | 225 West Santa Clara Street |  |       | (11)    |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 8,600                   |              |         |  | 94,035  |              |              |  |     |   |           |              | 626     |   |               |  | 8,600  |              |             |   | 94,661     |  |          |  | 103,261  |  |  |  | (4,741  | ) |  | 2001      |  | 12/31/03 |  |  | 43 | 
| |  | 1871 The Alameda            |  |       | (3)     |  |          | San Jose      |         |              | CA |              |           |               |             |                   |                 |              | 1,129                   |              |         |  | 6,399   |              |              |  |     |   |           |              | (2,784  | ) |               |  | 1,129  |              |             |   | 3,615      |  |          |  | 4,744    |  |  |  | (113    | ) |  | 1972      |  | 07/02/01 |  |  | 40 | 
| |  | 2727 Augustine              |  |       | (3)     |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 3,000                   |              |         |  | 17,000  |              |              |  |     |   |           |              | (11,636 | ) |               |  | 3,000  |              |             |   | 5,364      |  |          |  | 8,364    |  |  |  | (77     | ) |  | 1975      |  | 07/02/01 |  |  | 40 | 
| |  | 3001 Stender Way            |  |       | (3)     |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 2,263                   |              |         |  | 12,823  |              |              |  |     |   |           |              | (8,930  | ) |               |  | 2,263  |              |             |   | 3,893      |  |          |  | 6,156    |  |  |  | (55     | ) |  | 1978      |  | 07/02/01 |  |  | 40 | 
| |  | 3045 Stender Way            |  |       | (3)     |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 1,050                   |              |         |  | 5,950   |              |              |  |     |   |           |              | (4,310  | ) |               |  | 1,050  |              |             |   | 1,640      |  |          |  | 2,690    |  |  |  | (23     | ) |  | 1975      |  | 07/02/01 |  |  | 40 | 
| |  | 3281-3285 Scott Boulevard   |  |       | (3)     |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 1,275                   |              |         |  | 7,225   |              |              |  |     |   |           |              | (3,405  | ) |               |  | 1,275  |              |             |   | 3,820      |  |          |  | 5,095    |  |  |  | (157    | ) |  | 1981      |  | 07/02/01 |  |  | 40 | 
| |  | Applied Materials I & II    |  |       | (3)     |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 5,100                   |              |         |  | 28,900  |              |              |  |     |   |           |              | (15,875 | ) |               |  | 5,100  |              |             |   | 13,025     |  |          |  | 18,125   |  |  |  | (213    | ) |  | 1979      |  | 07/02/01 |  |  | 40 | 
| |  | Meier Central North         |  |       | (3)     |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 2,880                   |              |         |  | 16,320  |              |              |  |     |   |           |              | (5,613  | ) |               |  | 2,880  |              |             |   | 10,707     |  |          |  | 13,587   |  |  |  | (186    | ) |  | 1972/1980 |  | 07/02/01 |  |  | 40 | 
| |  | Meier Central South         |  |       | (3)     |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 5,265                   |              |         |  | 29,835  |              |              |  |     |   |           |              | (18,021 | ) |               |  | 5,265  |              |             |   | 11,814     |  |          |  | 17,079   |  |  |  | (190    | ) |  | 1972/1980 |  | 07/02/01 |  |  | 40 | 
| |  | Patrick Henry Drive         |  |       |         |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 2,475                   |              |         |  | 14,025  |              |              |  |     |   |           |              | 4       |   |               |  | 2,475  |              |             |   | 14,029     |  |          |  | 16,504   |  |  |  | (1,213  | ) |  | 1981      |  | 07/02/01 |  |  | 40 | 
| |  | Santa Clara Office Center I |  |       |         |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 2,010                   |              |         |  | 11,391  |              |              |  |     |   |           |              | 380     |   |               |  | 2,010  |              |             |   | 11,771     |  |          |  | 13,781   |  |  |  | (1,058  | ) |  | 1981      |  | 07/02/01 |  |  | 40 | 



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##### Table of Contents



| |  |                                   |  |       |        |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |  |      |   |           |              |        |   |               |  |        |              |             |   |            |  |          |  |          |  |  |  |         |   |  |                     |  |          |  |  |    | 
| |  | --------------------------------- |  | ----- | ------ |  | -------- | ------------- | ------- | ------------ | -- | ------------ | --------- | ------------- | ------------ | ----------------- | --------------- | ------------ | ----------------------- | ------------ | ------- | - | ------- | ------------ | ------------ |  | ---- | - | --------- | ------------ | ------ | - | ------------- |  | ------ | ------------ | ----------- | - | ---------- |  | -------- |  | -------- |  |  |  | ------- | - |  | ------------------- |  | -------- |  |  | -- | 
| |  |                                   |  |       |        |  |          |               |         |              |    |              |           |               |              | Costs Capitalized |                 |              | Gross Amount Carried at |              |         |   |         |              |              |  |      |   |           |             
| |  |                                   |  |       |        |  |          |               |         |              |    |              |           | Subsequent to |              |                   | Close of Period |              |                         |              |         |   |         |              |              |  |      |  
| |  |                                   |  |       |        |  |          |               |         |              |    | Initial Cost |           |               | Acquisition  |                   |                 | 12/31/2004   |                         |              |         |   |         |              |              |  |      |   |          
| |  |                                   |  |       |        |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              | Date of      |  |      |   |          
| |  |                                   |  |       |        |  |          |               |         | Encumbrances |    |              |           |               | Building and |                   |                 |              |                         | Building and |         |   |         |              | Building and |  |      |   |           | Accumulated  |        |   | Construction/ |  | Date   |              | Depreciable |  
| |  | Description                       |  | Notes |        |  | Location |               | State   |              |    | at 12/31/04  |           |               | Land         |                   |                 | Improvements |                         |              | Land    |   |         | Improvements |              |  | Land |   |           | Improvements |        |   | Total(1)      |  |        | Depreciation |             |   | Renovation |  | Acquired |  | Lives(2) | 
| |  |                                   |  |       |        |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |  |      |   |           |              |        |   |               |  |        |              |             |   |            |  |          |  |          | 
| |  | Santa Clara Office Center II      |  |       |        |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 2,870                   |              |         |   | 16,261  |              |              |  |     |   |           |              | 512    |   |               |  | 2,870  |              |             |   | 16,773     |  |          |  | 19,643   |  |  |  | (1,486  | ) |  | 1978                |  | 07/02/01 |  |  | 40 | 
| |  | Santa Clara Office Center III     |  |       |        |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 2,031                   |              |         |   | 11,509  |              |              |  |     |   |           |              | 390    |   |               |  | 2,031  |              |             |   | 11,899     |  |          |  | 13,930   |  |  |  | (1,086  | ) |  | 1980                |  | 07/02/01 |  |  | 40 | 
| |  | Santa Clara Office Center IV      |  |       |        |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 186                     |              |         |   | 1,057   |              |              |  |     |   |           |              |       |   |               |  | 186    |              |             |   | 1,057      |  |          |  | 1,243    |  |  |  | (91     | ) |  | 1979                |  | 07/02/01 |  |  | 40 | 
| |  | Lake Marriott Business Park       |  |       |        |  |          | Santa Clara   |         |              | CA |              |           |               |             |                   |                 |              | 9,091                   |              |         |   | 84,967  |              |              |  | 297  |   |           |              | 3,452  |   |               |  | 9,388  |              |             |   | 88,419     |  |          |  | 97,807   |  |  |  | (16,282 | ) |  | 1981                |  | 12/19/97 |  |  | 40 | 
| |  | Sunnyvale Business Center         |  |       |        |  |          | Sunnyvale     |         |              | CA |              |           |               |             |                   |                 |              | 4,890                   |              |         |   | 44,010  |              |              |  |     |   |           |              | 44     |   |               |  | 4,890  |              |             |   | 44,054     |  |          |  | 48,944   |  |  |  | (7,754  | ) |  | 1990                |  | 12/19/97 |  |  | 40 | 
| |  | Borregas Avenue                   |  |       | (3)    |  |          | Sunnyvale     |         |              | CA |              |           |               |             |                   |                 |              | 1,095                   |              |         |   | 6,205   |              |              |  |     |   |           |              | (2,444 | ) |               |  | 1,095  |              |             |   | 3,761      |  |          |  | 4,856    |  |  |  | (104    | ) |  | 1978                |  | 07/02/01 |  |  | 40 | 
| |  | Meier Sunnyvale                   |  |       | (3)    |  |          | Sunnyvale     |         |              | CA |              |           |               |             |                   |                 |              | 495                     |              |         |   | 2,805   |              |              |  |     |   |           |              | (1,052 | ) |               |  | 495    |              |             |   | 1,753      |  |          |  | 2,248    |  |  |  | (31     | ) |  | 1979                |  | 07/02/01 |  |  | 40 | 
| |  |                                   |  |       |        |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |  |      |   |           |              |        |   |               |  |        |              |             |   |            |  |          |  |          | 
|
| |  | San Jose Region Totals            |  |       | 49,827 |  |          |               | 302,750 |              |    |              | 2,276,216 |               |              |                   | 472             |              |                         |              | (87,446 | ) |         |              | 303,222      |  |      |   | 2,188,770 |              |        |   | 2,491,992     |  |        |              | (229,300    | ) |            |  |          |  |          |  |  | 
| |  |                                   |  |       |        |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |  |      |   |           |              |        |   |               |  |        |             
|
| |  | Seattle Region                    |  |       |        |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |  |      |   |           |              |        |   |               |  |        |              |             |   |            |  |          |  |          |  |  |  |         |   |  |                     |  |          |  |  |    | 
| |  | 10700 Building                    |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              |                        |              |         |   | 15,958  |              |              |  |     |   |           |              | 102    |   |               |  |       |              |             |   | 16,060     |  |          |  | 16,060   |  |  |  | (1,388  | ) |  | 1981                |  | 07/02/01 |  |  | 40 | 
| |  | 110 Atrium Place                  |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 6,333                   |              |         |   | 35,888  |              |              |  |     |   |           |              | 2,441  |   |               |  | 6,333  |              |             |   | 38,329     |  |          |  | 44,662   |  |  |  | (4,496  | ) |  | 1981                |  | 06/19/00 |  |  | 40 | 
| |  | Bellefield Office Park            |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 12,232                  |              |         |   | 69,312  |              |              |  | (1   | ) |           |              | 4,175  |   |               |  | 12,231 |              |             |   | 73,487     |  |          |  | 85,718   |  |  |  | (6,894  | ) |  | 1980                |  | 07/02/01 |  |  | 40 | 
| |  | Bellevue Gateway I                |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 3,593                   |              |         |   | 20,360  |              |              |  |     |   |           |              | 1,955  |   |               |  | 3,593  |              |             |   | 22,315     |  |          |  | 25,908   |  |  |  | (2,260  | ) |  | 1985                |  | 07/02/01 |  |  | 40 | 
| |  | Bellevue Gateway II               |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 2,016                   |              |         |   | 11,423  |              |              |  |     |   |           |              | 588    |   |               |  | 2,016  |              |             |   | 12,011     |  |          |  | 14,027   |  |  |  | (1,175  | ) |  | 1988                |  | 07/02/01 |  |  | 40 | 
| |  | Eastgate Office Park              |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 6,468                   |              |         |   | 36,650  |              |              |  | 3    |   |           |              | 5,087  |   |               |  | 6,471  |              |             |   | 41,737     |  |          |  | 48,208   |  |  |  | (3,850  | ) |  | 1985                |  | 07/02/01 |  |  | 40 | 
| |  | Gateway 405 Building              |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 1,011                   |              |         |   | 5,727   |              |              |  |     |   |           |              | 419    |   |               |  | 1,011  |              |             |   | 6,146      |  |          |  | 7,157    |  |  |  | (568    | ) |  | 1986                |  | 07/02/01 |  |  | 40 | 
| |  | I-90 Bellevue                     |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 3,725                   |              |         |   | 21,108  |              |              |  |     |   |           |              | 238    |   |               |  | 3,725  |              |             |   | 21,346     |  |          |  | 25,071   |  |  |  | (1,843  | ) |  | 1986                |  | 07/02/01 |  |  | 40 | 
| |  | Lincoln Executive Center          |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 3,235                   |              |         |   | 18,329  |              |              |  |     |   |           |              | 1,543  |   |               |  | 3,235  |              |             |   | 19,872     |  |          |  | 23,107   |  |  |  | (2,013  | ) |  | 1983-1985           |  | 07/02/01 |  |  | 40 | 
| |  | Lincoln Executive Center II & III |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 4,918                   |              |         |   | 27,868  |              |              |  |     |   |           |              | 3,473  |   |               |  | 4,918  |              |             |   | 31,341     |  |          |  | 36,259   |  |  |  | (2,658  | ) |  | 1983-1985           |  | 07/02/01 |  |  | 40 | 
| |  | Main Street Building              |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 1,398                   |              |         |   | 7,922   |              |              |  |     |   |           |              | 320    |   |               |  | 1,398  |              |             |   | 8,242      |  |          |  | 9,640    |  |  |  | (750    | ) |  | 1980                |  | 07/02/01 |  |  | 40 | 
| |  | Plaza Center                      |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 16,680                  |              |         |   | 94,521  |              |              |  |     |   |           |              | 2,384  |   |               |  | 16,680 |              |             |   | 96,905     |  |          |  | 113,585  |  |  |  | (8,571  | ) |  | 1978/1983           |  | 07/02/01 |  |  | 40 | 
| |  | Plaza East                        |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 4,687                   |              |         |   | 26,561  |              |              |  |     |   |           |              | 1,862  |   |               |  | 4,687  |              |             |   | 28,423     |  |          |  | 33,110   |  |  |  | (2,572  | ) |  | 1988                |  | 07/02/01 |  |  | 40 | 
| |  | Sunset North Corporate Campus     |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 17,031                  |              |         |   | 79,249  |              |              |  |     |   |           |              | 13,250 |   |               |  | 17,031 |              |             |   | 92,499     |  |          |  | 109,530  |  |  |  | (14,525 | ) |  | 1999                |  | 06/30/00 |  |  | 40 | 
| |  | City Center Bellevue              |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              | 10,349                  |              |         |   | 93,142  |              |              |  |     |   |           |              | 9,256  |   |               |  | 10,349 |              |             |   | 102,398    |  |          |  | 112,747  |  |  |  | (15,876 | ) |  | 1987                |  | 01/28/99 |  |  | 40 | 
| |  | One Bellevue Center               |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              |                        |              |         |   | 56,223  |              |              |  |     |   |           |              | 6,196  |   |               |  |       |              |             |   | 62,419     |  |          |  | 62,419   |  |  |  | (11,099 | ) |  | 1983                |  | 12/17/97 |  |  | 40 | 
| |  | Rainier Plaza                     |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              |                        |              |         |   | 79,928  |              |              |  |     |   |           |              | 5,639  |   |               |  |       |              |             |   | 85,567     |  |          |  | 85,567   |  |  |  | (15,418 | ) |  | 1986                |  | 12/17/97 |  |  | 40 | 
| |  | Key Center                        |  |       |        |  |          | Bellevue      |         |              | WA |              |           |               |             |                   |                 |              |                        |              |         |   | 78,447  |              |              |  |     |   |           |              | 6,552  |   |               |  |       |              |             |   | 84,999     |  |          |  | 84,999   |  |  |  | (4,970  | ) |  | 2000                |  | 06/19/00 |  |  | 40 | 
| |  | 4000 Kruse Way Place              |  |       |        |  |          | Lake Oswego   |         |              | OR |              |           |               |             |                   |                 |              | 4,475                   |              |         |   | 25,360  |              |              |  |     |   |           |              | 1,996  |   |               |  | 4,475  |              |             |   | 27,356     |  |          |  | 31,831   |  |  |  | (2,850  | ) |  | 1981/1986           |  | 07/02/01 |  |  | 40 | 
| |  | 4004 Kruse Way Place              |  |       |        |  |          | Lake Oswego   |         |              | OR |              |           |               |             |                   |                 |              | 1,888                   |              |         |   | 10,698  |              |              |  |     |   |           |              | 816    |   |               |  | 1,888  |              |             |   | 11,514     |  |          |  | 13,402   |  |  |  | (1,187  | ) |  | 1996                |  | 07/02/01 |  |  | 40 | 
| |  | 4800 Meadows                      |  |       |        |  |          | Lake Oswego   |         |              | OR |              |           |               |             |                   |                 |              |                        |              |         |   | 17,448  |              |              |  |     |   |           |              | 888    |   |               |  |       |              |             |   | 18,336     |  |          |  | 18,336   |  |  |  | (1,675  | ) |  | 1998                |  | 07/02/01 |  |  | 40 | 
| |  | 4900-5000 Meadows                 |  |       |        |  |          | Lake Oswego   |         |              | OR |              |           |               |             |                   |                 |              |                        |              |         |   | 30,528  |              |              |  |     |   |           |              | 1,343  |   |               |  |       |              |             |   | 31,871     |  |          |  | 31,871   |  |  |  | (3,146  | ) |  | 1990                |  | 07/02/01 |  |  | 40 | 
| |  | 4949 Meadows                      |  |       |        |  |          | Lake Oswego   |         |              | OR |              |           |               |             |                   |                 |              |                        |              |         |   | 26,941  |              |              |  |     |   |           |              | 1,360  |   |               |  |       |              |             |   | 28,301     |  |          |  | 28,301   |  |  |  | (2,667  | ) |  | 1997                |  | 07/02/01 |  |  | 40 | 
| |  | 5800 & 6000 Meadows               |  |       | (11)   |  |          | Lake Oswego   |         |              | OR |              |           |               |             |                   |                 |              | 4,810                   |              |         |   | 44,222  |              |              |  |     |   |           |              | 3      |   |               |  | 4,810  |              |             |   | 44,225     |  |          |  | 49,035   |  |  |  | (701    | ) |  | 1999; 2001          |  | 09/30/04 |  |  | 42 | 
| |  | Kruse Oaks I                      |  |       |        |  |          | Lake Oswego   |         |              | OR |              |           |               |             |                   |                 |              |                        |              |         |   | 14,648  |              |              |  |     |   |           |              | 4,513  |   |               |  |       |              |             |   | 19,161     |  |          |  | 19,161   |  |  |  | (2,184  | ) |  | 2001                |  | 07/02/01 |  |  | 40 | 
| |  | Kruse Way Plaza I & II            |  |       |        |  |          | Lake Oswego   |         |              | OR |              |           |               |             |                   |                 |              | 2,866                   |              |         |   | 16,239  |              |              |  |     |   |           |              | 1,211  |   |               |  | 2,866  |              |             |   | 17,450     |  |          |  | 20,316   |  |  |  | (1,764  | ) |  | 1984-1986           |  | 07/02/01 |  |  | 40 | 
| |  | Kruse Woods                       |  |       |        |  |          | Lake Oswego   |         |              | OR |              |           |               |             |                   |                 |              | 10,812                  |              |         |   | 80,977  |              |              |  |     |   |           |              | 3,517  |   |               |  | 10,812 |              |             |   | 84,494     |  |          |  | 95,306   |  |  |  | (8,063  | ) |  | 1986-1988           |  | 07/02/01 |  |  | 40 | 
| |  | Kruse Woods V                     |  |       | (6)    |  |          | Lake Oswego   |         |              | OR |              |           |               |             |                   |                 |              | 5,478                   |              |         |   | 21,244  |              |              |  |     |   |           |              | 4,364  |   |               |  | 5,478  |              |             |   | 25,608     |  |          |  | 31,086   |  |  |  | (664    | ) |  | 2004                |  | 07/02/01 |  |  | 40 | 
| |  | Island Corporate Center           |  |       |        |  |          | Mercer Island |         |              | WA |              |           |               | 12,288       |                   |                 |              | 2,700                   |              |         |   | 15,300  |              |              |  |     |   |           |              | 1,242  |   |               |  | 2,700  |              |             |   | 16,542     |  |          |  | 19,242   |  |  |  | (2,037  | ) |  | 1987                |  | 06/19/00 |  |  | 40 | 
| |  | 5550 Macadam Building             |  |       |        |  |          | Portland      |         |              | OR |              |           |               |             |                   |                 |              | 870                     |              |         |   | 4,929   |              |              |  |     |   |           |              | 489    |   |               |  | 870    |              |             |   | 5,418      |  |          |  | 6,288    |  |  |  | (568    | ) |  | 1980                |  | 07/02/01 |  |  | 40 | 
| |  | Benjamin Franklin Plaza           |  |       |        |  |          | Portland      |         |              | OR |              |           |               |             |                   |                 |              | 7,505                   |              |         |   | 42,529  |              |              |  |     |   |           |              | 3,162  |   |               |  | 7,505  |              |             |   | 45,691     |  |          |  | 53,196   |  |  |  | (4,569  | ) |  | 1974/1994           |  | 07/02/01 |  |  | 40 | 
| |  | Lincoln Center                    |  |       |        |  |          | Portland      |         |              | OR |              |           |               |             |                   |                 |              | 18,760                  |              |         |   | 106,307 |              |              |  |     |   |           |              | 8,503  |   |               |  | 18,760 |              |             |   | 114,810    |  |          |  | 133,570  |  |  |  | (10,777 | ) |  | 1980/1989           |  | 07/02/01 |  |  | 40 | 
| |  | One Pacific Square                |  |       |        |  |          | Portland      |         |              | OR |              |           |               |             |                   |                 |              | 4,451                   |              |         |   | 25,221  |              |              |  |     |   |           |              | 4,523  |   |               |  | 4,451  |              |             |   | 29,744     |  |          |  | 34,195   |  |  |  | (2,563  | ) |  | 1983                |  | 07/02/01 |  |  | 40 | 
| |  | River Forum I & II                |  |       |        |  |          | Portland      |         |              | OR |              |           |               |             |                   |                 |              | 4,038                   |              |         |   | 22,881  |              |              |  |     |   |           |              | 3,864  |   |               |  | 4,038  |              |             |   | 26,745     |  |          |  | 30,783   |  |  |  | (2,966  | ) |  | 1985                |  | 07/02/01 |  |  | 40 | 
| |  | RiverSide Centre (Oregon)         |  |       |        |  |          | Portland      |         |              | OR |              |           |               |             |                   |                 |              | 2,537                   |              |         |   | 12,353  |              |              |  |     |   |           |              | 810    |   |               |  | 2,537  |              |             |   | 13,163     |  |          |  | 15,700   |  |  |  | (2,166  | ) |  | 1947/1979           |  | 07/02/01 |  |  | 40 | 
| |  | Congress Center                   |  |       |        |  |          | Portland      |         |              | OR |              |           |               |             |                   |                 |              | 5,383                   |              |         |   | 48,634  |              |              |  |     |   |           |              | 10,307 |   |               |  | 5,383  |              |             |   | 58,941     |  |          |  | 64,324   |  |  |  | (11,306 | ) |  | 1980                |  | 12/17/97 |  |  | 40 | 
| |  | Southgate Office Plaza I & II     |  |       |        |  |          | Renton        |         |              | WA |              |           |               |             |                   |                 |              | 4,794                   |              |         |   | 27,163  |              |              |  |     |   |           |              | 4,469  |   |               |  | 4,794  |              |             |   | 31,632     |  |          |  | 36,426   |  |  |  | (3,305  | ) |  | 1987/1991           |  | 07/02/01 |  |  | 40 | 
| |  | Washington Mutual Tower           |  |       |        |  |          | Seattle       |         |              | WA |              |           |               | 78,943       |                   |                 |              | 51,000                  |              |         |   | 289,000 |              |              |  |     |   |           |              | 2,466  |   |               |  | 51,000 |              |             |   | 291,466    |  |          |  | 342,466  |  |  |  | (35,049 | ) |  | 1988                |  | 06/19/00 |  |  | 40 | 
| |  | 1111 Third Avenue                 |  |       |        |  |          | Seattle       |         |              | WA |              |           |               |             |                   |                 |              | 9,900                   |              |         |   | 89,571  |              |              |  |     |   |           |              | 4,800  |   |               |  | 9,900  |              |             |   | 94,371     |  |          |  | 104,271  |  |  |  | (18,736 | ) |  | 1980                |  | 12/17/97 |  |  | 40 | 
| |  | 10833-10845 NE 8th Street         |  |       |        |  |          | Seattle       |         |              | WA |              |           |               |             |                   |                 |              |                        |              |         |   | 2,000   |              |              |  |     |   |           |              | 28     |   |               |  |       |              |             |   | 2,028      |  |          |  | 2,028    |  |  |  | (24     | ) |  | 1962,1978,1982,1987 |  | 07/02/01 |  |  | 40 | 
| |  | Nordstrom Medical Tower           |  |       |        |  |          | Seattle       |         |              | WA |              |           |               |             |                   |                 |              | 1,700                   |              |         |   | 15,450  |              |              |  |     |   |           |              | 946    |   |               |  | 1,700  |              |             |   | 16,396     |  |          |  | 18,096   |  |  |  | (3,055  | ) |  | 1986                |  | 12/17/97 |  |  | 40 | 
| |  | Second and Seneca                 |  |       |        |  |          | Seattle       |         |              | WA |              |           |               |             |                   |                 |              | 10,922                  |              |         |   | 98,927  |              |              |  |     |   |           |              | 3,713  |   |               |  | 10,922 |              |             |   | 102,640    |  |          |  | 113,562  |  |  |  | (18,886 | ) |  | 1991                |  | 12/17/97 |  |  | 40 | 
| |  | Second and Spring Building        |  |       |        |  |          | Seattle       |         |              | WA |              |           |               |             |                   |                 |              | 1,968                   |              |         |   | 17,716  |              |              |  |     |   |           |              | 2,858  |   |               |  | 1,968  |              |             |   | 20,574     |  |          |  | 22,542   |  |  |  | (3,792  | ) |  | 1906/1989           |  | 07/29/98 |  |  | 40 | 
| |  | Wells Fargo Center                |  |       |        |  |          | Seattle       |         |              | WA |              |           |               |             |                   |                 |              | 21,361                  |              |         |   | 193,529 |              |              |  |     |   |           |              | 11,053 |   |               |  | 21,361 |              |             |   | 204,582    |  |          |  | 225,943  |  |  |  | (36,861 | ) |  | 1983                |  | 12/17/97 |  |  | 40 | 
| |  | Nimbus Corporate Center           |  |       |        |  |          | Tigard        |         |              | OR |              |           |               |             |                   |                 |              | 12,934                  |              |         |   | 73,291  |              |              |  |     |   |           |              | 9,869  |   |               |  | 12,934 |              |             |   | 83,160     |  |          |  | 96,094   |  |  |  | (8,105  | ) |  | 1991                |  | 07/02/01 |  |  | 40 | 
| |  |                                   |  |       |        |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |  |      |   |           |              |        |   |               |  |        |              |             |   |            |  |          |  |          | 
|
| |  | Seattle Region Totals             |  |       | 91,231 |  |          |               | 284,828 |              |    |              | 2,151,722 |               |              |                   | 2               |              |                         |              | 158,593 |   |         |              | 284,830      |  |      |   | 2,310,315 |              |        |   | 2,595,145     |  |        |              | (290,592    | ) |            |  |          |  |          |  |  | 
| |  |                                   |  |       |        |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |  |      |   |           |              |        |   |               |  |        |             
|
| |  | Washington D.C. Region            |  |       |        |  |          |               |         |              |    |              |           |               |              |                   |                 |              |                         |              |         |   |         |              |              |  |      |   |           |              |        |   |               |  |        |              |             |   |            |  |          |  |          |  |  |  |         |   |  |                     |  |          |  |  |    | 
| |  | Polk and Taylor Buildings         |  |       |        |  |          | Arlington     |         |              | VA |              |           |               |             |                   |                 |              | 16,943                  |              |         |   | 152,483 |              |              |  |     |   |           |              | 35,779 |   |               |  | 16,943 |              |             |   | 188,262    |  |          |  | 205,205  |  |  |  | (30,431 | ) |  | 1970                |  | 05/22/98 |  |  | 40 | 



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##### Table of Contents



| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            |  |  |   |            |   |  |           |  |          |  |  |      | 
| |  | ------------------------------- |  | ----- | --------- |  | -------- | --------------- | --------- | ------------ | ---- | ------------ | ---------- | ------------- | ------------ | ----------------- | --------------- | ------------ | ----------------------- | ------------ | --------- | - | ---------- | ------------ | ------------ | - | ----- | - | ---------- | ------------ | --------- |  | ------------- | - | --------- | ------------ | ----------- | - | ---------- |  | -------- | - | ---------- |  |  | - | ---------- | - |  | --------- |  | -------- |  |  | ---- | 
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              | Costs Capitalized |                 |              | Gross Amount Carried at |              |           |   |            |              |              |   |       |   |            |             
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            | Subsequent to |              |                   | Close of Period |              |                         |              |           |   |            |              |              |   |       |  
| |  |                                 |  |       |           |  |          |                 |           |              |      | Initial Cost |            |               | Acquisition  |                   |                 | 12/31/2004   |                         |              |           |   |            |              |              |   |       |   |           
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              | Date of      |   |       |   |           
| |  |                                 |  |       |           |  |          |                 |           | Encumbrances |      |              |            |               | Building and |                   |                 |              |                         | Building and |           |   |            |              | Building and |   |       |   |            | Accumulated  |           |  | Construction/ |   | Date      |              | Depreciable |  
| |  | Description                     |  | Notes |           |  | Location |                 | State     |              |      | at 12/31/04  |            |               | Land         |                   |                 | Improvements |                         |              | Land      |   |            | Improvements |              |   | Land  |   |            | Improvements |           |  | Total(1)      |   |           | Depreciation |             |   | Renovation |  | Acquired |   | Lives(2)   | 
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            | 
| |  | One Valley Square               |  |       |           |  |          | Blue Bell       |           |              | PA   |              |            |               |             |                   |                 |              | 717                     |              |           |   | 6,457      |              |              |   |      |   |            |              | 1,131     |  |               |   | 717       |              |             |   | 7,588      |  |          |   | 8,305      |  |  |   | (1,700     | ) |  | 1982      |  | 11/21/97 |  |  | 40   | 
| |  | Two Valley Square               |  |       |           |  |          | Blue Bell       |           |              | PA   |              |            |               |             |                   |                 |              | 879                     |              |           |   | 7,913      |              |              |   |      |   |            |              | 717       |  |               |   | 879       |              |             |   | 8,630      |  |          |   | 9,509      |  |  |   | (1,686     | ) |  | 1990      |  | 10/07/97 |  |  | 40   | 
| |  | Three Valley Square             |  |       |           |  |          | Blue Bell       |           |              | PA   |              |            |               |             |                   |                 |              | 1,012                   |              |           |   | 9,111      |              |              |   |      |   |            |              | 2,398     |  |               |   | 1,012     |              |             |   | 11,509     |  |          |   | 12,521     |  |  |   | (2,621     | ) |  | 1984      |  | 11/21/97 |  |  | 40   | 
| |  | Four & Five Valley Square       |  |       |           |  |          | Blue Bell       |           |              | PA   |              |            |               |             |                   |                 |              | 866                     |              |           |   | 7,793      |              |              |   | (1    | ) |            |              | 1,898     |  |               |   | 865       |              |             |   | 9,691      |  |          |   | 10,556     |  |  |   | (2,043     | ) |  | 1988      |  | 10/07/97 |  |  | 40   | 
| |  | Four Falls                      |  |       |           |  |          | Conshohocken    |           |              | PA   |              |            |               |             |                   |                 |              | 4,939                   |              |           |   | 44,458     |              |              |   | 55    |   |            |              | 3,574     |  |               |   | 4,994     |              |             |   | 48,032     |  |          |   | 53,026     |  |  |   | (9,410     | ) |  | 1988      |  | 10/07/97 |  |  | 40   | 
| |  | Centerpointe I & II             |  |       |           |  |          | Fairfax         |           |              | VA   |              |            |               |             |                   |                 |              | 8,838                   |              |           |   | 79,540     |              |              |   | 367   |   |            |              | 1,915     |  |               |   | 9,205     |              |             |   | 81,455     |  |          |   | 90,660     |  |  |   | (14,951    | ) |  | 1990/1998 |  | 12/19/97 |  |  | 40   | 
| |  | Fair Oaks Plaza                 |  |       |           |  |          | Fairfax         |           |              | VA   |              |            |               |             |                   |                 |              | 2,412                   |              |           |   | 21,712     |              |              |   | 35    |   |            |              | 1,996     |  |               |   | 2,447     |              |             |   | 23,708     |  |          |   | 26,155     |  |  |   | (4,682     | ) |  | 1986      |  | 11/24/97 |  |  | 40   | 
| |  | Northridge I                    |  |       | (8)       |  |          | Herndon         |           |              | VA   |              |            |               | 12,536       |                   |                 |              | 3,225                   |              |           |   | 29,024     |              |              |   |      |   |            |              | 552       |  |               |   | 3,225     |              |             |   | 29,576     |  |          |   | 32,801     |  |  |   | (5,223     | ) |  | 1988      |  | 12/19/97 |  |  | 40   | 
| |  | Oak Hill Plaza                  |  |       |           |  |          | King of Prussia |           |              | PA   |              |            |               |             |                   |                 |              | 2,208                   |              |           |   | 19,879     |              |              |   |      |   |            |              | 2,335     |  |               |   | 2,208     |              |             |   | 22,214     |  |          |   | 24,422     |  |  |   | (4,159     | ) |  | 1982      |  | 10/07/97 |  |  | 40   | 
| |  | Walnut Hill Plaza               |  |       |           |  |          | King of Prussia |           |              | PA   |              |            |               | 13,425       |                   |                 |              | 2,045                   |              |           |   | 18,410     |              |              |   |      |   |            |              | 1,616     |  |               |   | 2,045     |              |             |   | 20,026     |  |          |   | 22,071     |  |  |   | (3,944     | ) |  | 1985      |  | 10/07/97 |  |  | 40   | 
| |  | American Center                 |  |       | (11)      |  |          | McLean          |           |              | VA   |              |            |               |             |                   |                 |              | 15,000                  |              |           |   | 42,272     |              |              |   |      |   |            |              | 5,098     |  |               |   | 15,000    |              |             |   | 47,370     |  |          |   | 62,370     |  |  |   | (2,485     | ) |  | 1985      |  | 05/25/04 |  |  | 35   | 
| |  | John Marshall I                 |  |       |           |  |          | McLean          |           |              | VA   |              |            |               |             |                   |                 |              | 5,216                   |              |           |   | 46,814     |              |              |   | 24    |   |            |              | 576       |  |               |   | 5,240     |              |             |   | 47,390     |  |          |   | 52,630     |  |  |   | (8,376     | ) |  | 1981      |  | 12/19/97 |  |  | 40   | 
| |  | John Marshall III               |  |       |           |  |          | McLean          |           |              | VA   |              |            |               |             |                   |                 |              | 9,950                   |              |           |   | 29,863     |              |              |   |      |   |            |              | 3,736     |  |               |   | 9,950     |              |             |   | 33,599     |  |          |   | 43,549     |  |  |   | (5,266     | ) |  | 2000      |  | 12/19/97 |  |  | 40   | 
| |  | E.J. Randolph                   |  |       | (8)       |  |          | McLean          |           |              | VA   |              |            |               | 13,819       |                   |                 |              | 3,937                   |              |           |   | 35,429     |              |              |   | 7     |   |            |              | 3,061     |  |               |   | 3,944     |              |             |   | 38,490     |  |          |   | 42,434     |  |  |   | (7,227     | ) |  | 1983      |  | 12/19/97 |  |  | 40   | 
| |  | E.J. Randolph II                |  |       |           |  |          | McLean          |           |              | VA   |              |            |               |             |                   |                 |              | 5,770                   |              |           |   | 24,587     |              |              |   |      |   |            |              | 4,006     |  |               |   | 5,770     |              |             |   | 28,593     |  |          |   | 34,363     |  |  |   | (2,289     | ) |  | 2002      |  | 12/19/97 |  |  | 40   | 
| |  | Reston Town Center              |  |       |           |  |          | Reston          |           |              | VA   |              |            |               | 112,987      |                   |                 |              | 18,175                  |              |           |   | 154,576    |              |              |   | 83    |   |            |              | 17,033    |  |               |   | 18,258    |              |             |   | 171,609    |  |          |   | 189,867    |  |  |   | (31,505    | ) |  | 1990      |  | 10/22/96 |  |  | 40   | 
| |  | Reston Town Center Garage       |  |       |           |  |          | Reston          |           |              | VA   |              |            |               |             |                   |                 |              | 1,943                   |              |           |   | 9,792      |              |              |   |      |   |            |              | 1,821     |  |               |   | 1,943     |              |             |   | 11,613     |  |          |   | 13,556     |  |  |   | (2,012     | ) |  | 1999      |  | 10/22/96 |  |  | 40   | 
| |  | 1300 North 17th Street          |  |       |           |  |          | Rosslyn         |           |              | VA   |              |            |               |             |                   |                 |              | 9,811                   |              |           |   | 88,296     |              |              |   |      |   |            |              | 9,076     |  |               |   | 9,811     |              |             |   | 97,372     |  |          |   | 107,183    |  |  |   | (16,689    | ) |  | 1980      |  | 12/19/97 |  |  | 40   | 
| |  | 1616 North Fort Myer Drive      |  |       |           |  |          | Rosslyn         |           |              | VA   |              |            |               |             |                   |                 |              | 6,961                   |              |           |   | 62,646     |              |              |   |      |   |            |              | 7,926     |  |               |   | 6,961     |              |             |   | 70,572     |  |          |   | 77,533     |  |  |   | (12,228    | ) |  | 1974      |  | 12/19/97 |  |  | 40   | 
| |  | Army and Navy Club Building     |  |       |           |  |          | Washington      |           |              | D.C. |              |            |               |             |                   |                 |              | 3,773                   |              |           |   | 33,954     |              |              |   |      |   |            |              | 177       |  |               |   | 3,773     |              |             |   | 34,131     |  |          |   | 37,904     |  |  |   | (2,254     | ) |  | 1986      |  | 05/24/02 |  |  | 40   | 
| |  | Market Square                   |  |       |           |  |          | Washington      |           |              | D.C. |              |            |               |             |                   |                 |              | 33,077                  |              |           |   | 187,437    |              |              |   |      |   |            |              | 5,012     |  |               |   | 33,077    |              |             |   | 192,449    |  |          |   | 225,526    |  |  |   | (21,806    | ) |  | 1990      |  | 06/19/00 |  |  | 40   | 
| |  | One Lafayette Centre            |  |       |           |  |          | Washington      |           |              | D.C. |              |            |               |             |                   |                 |              | 8,262                   |              |           |   | 74,362     |              |              |   |      |   |            |              | 3,021     |  |               |   | 8,262     |              |             |   | 77,383     |  |          |   | 85,645     |  |  |   | (14,560    | ) |  | 1980/1993 |  | 10/17/97 |  |  | 40   | 
| |  | Two Lafayette Centre            |  |       |           |  |          | Washington      |           |              | D.C. |              |            |               |             |                   |                 |              | 2,642                   |              |           |   | 26,676     |              |              |   |      |   |            |              | 1,461     |  |               |   | 2,642     |              |             |   | 28,137     |  |          |   | 30,779     |  |  |   | (3,333     | ) |  | 1985      |  | 07/11/00 |  |  | 40   | 
| |  | Three Lafayette Centre          |  |       |           |  |          | Washington      |           |              | D.C. |              |            |               |             |                   |                 |              | 6,871                   |              |           |   | 61,841     |              |              |   |      |   |            |              | 6,987     |  |               |   | 6,871     |              |             |   | 68,828     |  |          |   | 75,699     |  |  |   | (5,623     | ) |  | 1986      |  | 10/17/01 |  |  | 40   | 
| |  | Liberty Place                   |  |       |           |  |          | Washington      |           |              | D.C. |              |            |               |             |                   |                 |              | 5,625                   |              |           |   | 50,625     |              |              |   |      |   |            |              | 1,861     |  |               |   | 5,625     |              |             |   | 52,486     |  |          |   | 58,111     |  |  |   | (2,955     | ) |  | 1991      |  | 09/17/02 |  |  | 40   | 
| |  | One Devon Square                |  |       |           |  |          | Wayne           |           |              | PA   |              |            |               |             |                   |                 |              | 1,025                   |              |           |   | 9,227      |              |              |   |      |   |            |              | 1,437     |  |               |   | 1,025     |              |             |   | 10,664     |  |          |   | 11,689     |  |  |   | (2,324     | ) |  | 1984      |  | 10/07/97 |  |  | 40   | 
| |  | Two Devon Square                |  |       |           |  |          | Wayne           |           |              | PA   |              |            |               |             |                   |                 |              | 659                     |              |           |   | 5,935      |              |              |   |      |   |            |              | 565       |  |               |   | 659       |              |             |   | 6,500      |  |          |   | 7,159      |  |  |   | (1,216     | ) |  | 1985      |  | 10/07/97 |  |  | 40   | 
| |  | Three Devon Square              |  |       |           |  |          | Wayne           |           |              | PA   |              |            |               |             |                   |                 |              | 413                     |              |           |   | 3,713      |              |              |   |      |   |            |              | 23        |  |               |   | 413       |              |             |   | 3,736      |  |          |   | 4,149      |  |  |   | (671       | ) |  | 1985      |  | 10/07/97 |  |  | 40   | 
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            | 
|
| |  | Washington D.C. Region Totals   |  |       | 152,767   |  |          |                 | 183,194   |              |      |              | 1,344,825  |               |              |                   | 570             |              |                         |              | 126,788   |   |            |              | 183,764      |   |       |   | 1,471,613  |              |           |  | 1,655,377     |   |           |              | (223,669    | ) |            |  |          |   |            |  |  |  
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |             
|
| |  | Subtotal Office Properties      |  |       | 2,609,065 |  |          |                 | 2,961,851 |              |      |              | 20,592,313 |               |              |                   | 3,896           |              |                         |              | 1,358,509 |   |            |              | 2,965,747    |   |       |   | 21,950,822 |              |           |  | 24,916,569    |   |           |              | (3,127,764  | ) |            |  |          |   |            |  |  |  
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |             
|
| |  | Development Property:           |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            |  |  |   |            |   |  |           |  |          |  |  |      | 
| |  | Cambridge Science Center        |  |       | (9)       |  |          | Cambridge       |           |              | MA   |              |            |               |             |                   |                 |              | 1,959                   |              |           |   | 17,635     |              |              |   |      |   |            |              | 20,898    |  |               |   | 1,959     |              |             |   | 38,533     |  |          |   | 40,492     |  |  |   | (2,305     | ) |  | 2004      |  | 12/19/97 |  |  | 40   | 
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            | 
|
| |  | Subtotal Development Property   |  |       |          |  |          |                 | 1,959     |              |      |              | 17,635     |               |              |                   |                |              |                         |              | 20,898    |   |            |              | 1,959        |   |       |   | 38,533     |              |           |  | 40,492        |   |           |              | (2,305      | ) |            |  |          |   |            |  |  |  
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |             
|
| |  | Property Held for Sale:         |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            |  |  |   |            |   |  |           |  |          |  |  |      | 
| |  | Northland Plaza                 |  |       | (15)      |  |          | Bloomington     |           |              | MN   |              |            |               |             |                   |                 |              | 4,705                   |              |           |   | 40,223     |              |              |   |      |   |            |              | 5,031     |  |               |   | 4,705     |              |             |   | 45,254     |  |          |   | 49,959     |  |  |   | (8,705     | ) |  | 1985      |  | 07/02/98 |  |  | 40   | 
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            | 
|
| |  | Subtotal Property Held for Sale |  |       | -         |  |          |                 | 4,705     |              |      |              | 40,223     |               |              |                   |                |              |                         |              | 5,031     |   |            |              | 4,705        |   |       |   | 45,254     |              |           |  | 49,959        |   |           |              | (8,705      | ) |            |  |          |   |            |  |  |  
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |             
|
| |  | Industrial Properties:          |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            |  |  |   |            |   |  |           |  |          |  |  |      | 
| |  | San Francisco Region            |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            |  |  |   |            |   |  |           |  |          |  |  |      | 
| |  | Benicia Ind II & III            |  |       |           |  |          | Benicia         |           |              | CA   |              |            |               |             |                   |                 |              | 2,250                   |              |           |   | 12,750     |              |              |   |      |   |            |              | 295       |  |               |   | 2,250     |              |             |   | 13,045     |  |          |   | 15,295     |  |  |   | (1,165     | ) |  | 1996      |  | 07/02/01 |  |  | 40   | 
| |  | Independent Road Warehouse      |  |       |           |  |          | Oakland         |           |              | CA   |              |            |               |             |                   |                 |              | 900                     |              |           |   | 5,100      |              |              |   |      |   |            |              |          |  |               |   | 900       |              |             |   | 5,100      |  |          |   | 6,000      |  |  |   | (441       | ) |  | 1972      |  | 07/02/01 |  |  | 40   | 
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            | 
|
| |  | San Francisco Region Totals     |  |       |          |  |          |                 | 3,150     |              |      |              | 17,850     |               |              |                   |                |              |                         |              | 295       |   |            |              | 3,150        |   |       |   | 18,145     |              |           |  | 21,295        |   |           |              | (1,606      | ) |            |  |          |   |            |  |  |  
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |             
|
| |  | Subtotal Industrial Properties  |  |       |           |  |          |                 | 3,150     |              |      |              | 17,850     |               |              |                   |                |              |                         |              | 295       |   |            |              | 3,150        |   |       |   | 18,145     |              |           |  | 21,295        |   |           |              | (1,606      | ) |            |  |          |   |            |  |  |  
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |             
|
| |  | Land Available for Development  |  |       |           |  |          | Various         |           |              |      |              |            |               |             |                   |                 |              | 252,524                 |              |           |   |           |              |              |   |      |   |            |              | 3,832     |  |               |   | 252,524   |              |             |   | 3,832      |  |          |   | 256,356    |  |  |   | (4         | ) |  |           |  | Various  |  |  | N/A  | 
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            | 
|
| |  | Management Business             |  |       |           |  |          |                 |           |              |      |              |            |               |             |                   |                 |              | 17                      |              |           |   | (150       | )            |              |   | 84    |   |            |              | 136,053   |  |               |   | 101       |              |             |   | 135,903    |  |          |   | 136,004    |  |  |   | (40,323    | ) |  |           |  | Various  |  |  | 3-40 | 
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            | 
|
| |  | Investment in Real Estate       |  |       | (10)      |  |          |                 |           |              |      |              |            | $             | 2,609,065    |                   |                 | $            | 3,224,206               |              |           | $ | 20,667,871 |              |              | $ | 3,980 |   |            | $            | 1,524,618 |  |               | $ | 3,228,186 |              |             | $ | 22,192,489 |  |          | $ | 25,420,675 |  |  | $ | (3,180,707 | ) |  |           |  |          |  |  |      | 
| |  |                                 |  |       |           |  |          |                 |           |              |      |              |            |               |              |                   |                 |              |                         |              |           |   |            |              |              |   |       |   |            |              |           |  |               |   |           |              |             |   |            |  |          |   |            | 






|    |                                                                                                                                                                                                                                                                                                                               
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The aggregate cost for Federal Income Tax purposes as of
    December 31, 2004 was approximately $13.9 billion.                                                                                                                                                                                                               
|   
|(2) | The life to compute depreciation on building is
    23-45 years, except for Palo Alto which is subject to a
    ground lease that terminates in 2023. Therefore, the building is
    depreciated over the remaining term of the ground lease. The
    life to compute depreciation on building improvements is
    3-40 years.
|   
|(3) | During 2004 a non-cash impairment charge of $228.3 million
    was recorded for these properties.                                                                                                                                                                                                                             
|   
|(4) | This Property contains 106 residential units in addition to
    226,197 square feet of office space.                                                                                                                                                                                                                          



---



##### Table of Contents





|    |                                                                                                                                                                                                              
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(5) | A mortgage note encumbering these properties has cross default
    and collateralization provisions.                                                                                                         
|   
|(6) | These properties were previously under development and have been
    placed into service during 2004.                                                                                                        
|   
|(7) | Equity Office and an unaffiliated party own this property as
    tenants-in-common.                                                                                                                          
|   
|(8) | These loans are subject to cross default and collateralization
    provisions.                                                                                                                               
|   
|(9) | This property is in development. During the development period
    certain operating costs, including real estate taxes together
    with interest incurred during the development stages is
    capitalized.



|     |                                                                                                                                                                                   
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(10) | The encumbrances at December 31, 2004 include a net
    discount of approximately $13.7 million.                                                                                  
|    
|(11) | The initial cost of acquisition recorded for these properties
    includes intangible assets that are classified in deferred
    lease costs on the consolidated balance sheets.
|    
|(12) | Our interest in this Office Property is attributed to our
    ownership of indebtedness and was consolidated in 2004 under
    FIN 46(R).                                         
|    
|(13) | During 2004, we consolidated this property in connection with
    the acquisition of one of our partners economic interest.                                                      
|    
|(14) | This property was consolidated in 2004 under FIN 46(R).                                                                                                                           
|    
|(15) | This property was held for sale as of December 31, 2004,
    pursuant to FAS 144.                                                                                                 



---



##### Table of Contents



A summary of activity of investment in real estate and
accumulated depreciation is as follows:




|                                 |                           |                                                                                                                                               |            |  |                   |   |            |                   |            |   |            |  |          |  
|-------------------------------- | ------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------- | ---------- |  | ----------------- | - | ---------- | ----------------- | ---------- | - | ---------- |  | -------- | -
|                                 |                           | December 31, 2004                                                                                                                             |            |  | December 31, 2003 |   |            | December 31, 2002 |           
|                                 |                           |                                                                                                                                               |            |  |                   |   |            |                   |           
|Balance, beginning of the period |                           | $                                                                                                                                             | 24,334,162 |  |                   | $ | 25,163,516 |                   |            | $ | 24,816,351 | 
|                                 | Additions during period:  |                                                                                                                                               |            |  |                   |   |            |                   |            |   |            |  |         
|                                 |                           | Acquisitions                                                                                                                                  |            |  | 484,566           |   |            |                   | 163,511    |   |            |  | 121,986  |  
|                                 |                           | Consolidation of properties previously accounted for under the
    equity method                                                              |            |  | 819,569           |   |            |                   | 85,870     |   |            |  | 377,532  |  
|                                 |                           | Consolidation of SunAmerica Center                                                                                                            |            |  | 330,787           |   |            |                   |           |   |            |  |         |  
|                                 |                           | Improvements                                                                                                                                  |            |  | 430,570           |   |            |                   | 471,638    |   |            |  | 328,930  |  
|                                 | Deductions during period: |                                                                                                                                               |            |  |                   |   |            |                   |            |   |            |  |         
|                                 |                           | Properties disposed of                                                                                                                        |            |  | (709,033          | ) |            |                   | (1,545,598 | ) |            |  | (457,077 | )
|                                 |                           | Impairment on property held for sale                                                                                                          |            |  | (2,123            | ) |            |                   |           |   |            |  |         |  
|                                 |                           | Impairment                                                                                                                                    |            |  | (275,350          | ) |            |                   | (7,667     | ) |            |  |         |  
|                                 |                           | Write-off of fully depreciated assets which are no longer in
    service                                                                      |            |  | (77,816           | ) |            |                   | (19,048    | ) |            |  | (24,206  | )
|                                 |                           |                                                                                                                                               |            |  |                   |   |            |                   |           
|                                 |                           |                                                                                                                                               | 25,335,332 |  |                   |   | 24,312,222 |                   |            |   | 25,163,516 | 
|                                 |                           | Initial cost of acquisition recorded as intangible assets and
    classified in deferred lease costs on the
    consolidated balance sheets |            |  | 85,343            |   |            |                   | 21,940     |   |            |  |         |  
|                                 |                           |                                                                                                                                               |            |  |                   |   |            |                   |           
|Balance, end of period           |                           | $                                                                                                                                             | 25,420,675 |  |                   | $ | 24,334,162 |                   |            | $ | 25,163,516 | 
|                                 |                           |                                                                                                                                               |            |  |                   |   |            |                   |           



|                                 |                           |                                                                                                                                                                           |            |            |                   |   |            |                   |          |   |            |            |          |  
|-------------------------------- | ------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------- | ---------- | ----------------- | - | ---------- | ----------------- | -------- | - | ---------- | ---------- | -------- | -
|                                 |                           | December 31, 2004                                                                                                                                                         |            |            | December 31, 2003 |   |            | December 31, 2002 |         
|                                 |                           |                                                                                                                                                                           |            |            |                   |   |            |                   |         
|Balance, beginning of the period |                           | $                                                                                                                                                                         | (2,578,361 | )          |                   | $ | (2,077,613 | )                 |          | $ | (1,494,301 | )         
|                                 | Additions during period:  |                                                                                                                                                                           |            |            |                   |   |            |                   |          |   |            |            |         
|                                 |                           | Depreciation                                                                                                                                                              |            |            | (709,924          | ) |            |                   | (663,935 | ) |            |            | (637,633 | )
|                                 |                           | Consolidation of properties previously accounted for under the
    equity method                                                                                          |            |            | (53,110           | ) |            |                   |         |   |            |            | (617     | )
|                                 |                           | Consolidation of SunAmerica Center                                                                                                                                        |            |            | (31,219           | ) |            |                   |         |   |            |            |         |  
|                                 | Deductions during period: |                                                                                                                                                                           |            |            |                   |   |            |                   |          |   |            |            |         
|                                 |                           | Properties disposed of                                                                                                                                                    |            |            | 75,123            |   |            |                   | 144,251  |   |            |            | 30,732   |  
|                                 |                           | Impairment                                                                                                                                                                |            |            | 46,180            |   |            |                   | 167      |   |            |            |         |  
|                                 |                           | Write-off of fully depreciated assets which are no longer in
    service                                                                                                  |            |            | 77,816            |   |            |                   | 19,048   |   |            |            | 24,206   |  
|                                 |                           |                                                                                                                                                                           |            |            |                   |   |            |                   |         
|                                 |                           |                                                                                                                                                                           | (3,173,495 | )          |                   |   | (2,578,082 | )                 |          |   | (2,077,613 | )         
|                                 |                           | Accumulated amortization of initial cost of acquisition recorded
    as intangible assets and classified in deferred lease
    costs on the consolidated balance sheets |            |            | (7,212            | ) |            |                   | (279     | ) |            |            |         |  
|                                 |                           |                                                                                                                                                                           |            |            |                   |   |            |                   |         
|                                 | Balance, end of period    |                                                                                                                                                                           | $          | (3,180,707 | )                 |   | $          | (2,578,361        | )        |   | $          | (2,077,613 | )       
|                                 |                           |                                                                                                                                                                           |            |            |                   |   |            |                   |