##### Table of Contents









UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549





FORM 10-Q


|           |  |                                                                                             
|---------- |  | --------------------------------------------------------------------------------------------
|(Mark One) |  |                                                                                             
|þ          |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934 
|           |  | For the quarterly period ended June 30, 2005                                                
|           |  | or                                                                                          
|o          |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
|           |  | For the transition period
    from           to                                             

Commission File Number: 1-13625


EOP OPERATING LIMITED PARTNERSHIP


(Exact name of registrant as specified in its charter)


|                                                                                                     |  |                                         
|---------------------------------------------------------------------------------------------------- |  | ----------------------------------------
|Delaware                                                                                             |  | 36-4156801                              
|(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)                         

(312) 466-3300


Registrants telephone number, including area code


þ o


þ o












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TABLE OF CONTENTS



|                                                                               |                                                                                                |  |  |  |  |  |  | 
|------------------------------------------------------------------------------ | ---------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I -- FINANCIAL INFORMATION                                               
|                                                                               | Item 1. Financial Statements.                                                                 
|                                                                               | Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
|                                                                               | Item 3. Quantitative and Qualitative Disclosures About Market Risk.                           
|                                                                               | Item 4. Controls and Procedures.                                                              
|Part II -- OTHER INFORMATION                                                  
|                                                                               | Item 1. Legal Proceedings.                                                                    
|                                                                               | Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.                          
|                                                                               | Item 6. Exhibits.                                                                             
|SIGNATURES                                                                    
|EXHIBIT INDEX                                                                 
|Fifth Amendment to Third Amended and Restated Agreement of Limited Partnership
|Schedule of Medium-Term InterNotes (Fixed Rate)                               
|Revolving Credit Agreement                                                    
|Statement of Computation of Ratio of Earnings to Fixed Charges                
|Certification of Chief Executive Officer                                      
|Certification of Chief Financial Officer                                      
|Certification of CEO and CFO Pursuant to Section 906                          



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##### Table of Contents






PART I  FINANCIAL INFORMATION







|        |                      
|------- | ---------------------
|Item 1. | Financial Statements.

EOP OPERATING LIMITED PARTNERSHIP


CONSOLIDATED BALANCE SHEETS


|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |         |            |            |            |         |            | 
|-------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------- | ------------ | ------- | ---------- | ---------- | ---------- | ------- | ---------- | 
|                                                                                                   |                                                                                                                                                                                 | June 30,                                                                                                      |                                                                                                                                        |                                                                                                         | December 31, |        
|(Dollars in thousands, except per unit amounts)                                                    |                                                                                                                                                                                 | 2005                                                                                                          |                                                                                                                                        |                                                                                                         | 2004         |        
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |        
|                                                                                                   |                                                                                                                                                                                 | (Unaudited)                                                                                                   |                                                                                                                                        |                                                                                                         |             
|Assets:                                                                                            |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |         |            |           
|                                                                                                   | Investments in real estate                                                                                                                                                      |                                                                                                               | $                                                                                                                                      | 23,350,900                                                                                              |              |         | $          | 24,876,625 |           
|                                                                                                   | Developments in process                                                                                                                                                         |                                                                                                               |                                                                                                                                        | 18,780                                                                                                  |              |         |            | 40,492     |           
|                                                                                                   | Land available for development                                                                                                                                                  |                                                                                                               |                                                                                                                                        | 239,220                                                                                                 |              |         |            | 252,524    |           
|                                                                                                   | Investments in real estate held for sale, net of accumulated
    depreciation                                                                                                   |                                                                                                               |                                                                                                                                        | 55,875                                                                                                  |              |         |            | 118,672    |           
|                                                                                                   | Accumulated depreciation                                                                                                                                                        |                                                                                                               |                                                                                                                                        | (3,146,426                                                                                              | )            |         |            | (3,148,137 | )         
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |        
|                                                                                                   |                                                                                                                                                                                 | Investments in real estate, net of accumulated depreciation                                                   |                                                                                                                                        |                                                                                                         | 20,518,349   |         |            |            | 22,140,176 |        
|                                                                                                   | Cash and cash equivalents                                                                                                                                                       |                                                                                                               |                                                                                                                                        | 615,997                                                                                                 |              |         |            | 107,126    |           
|                                                                                                   | Tenant and other receivables (net of allowance for doubtful
    accounts of $6,709 and $6,908, respectively)                                                                    |                                                                                                               |                                                                                                                                        | 74,092                                                                                                  |              |         |            | 75,775     |           
|                                                                                                   | Deferred rent receivable                                                                                                                                                        |                                                                                                               |                                                                                                                                        | 486,238                                                                                                 |              |         |            | 478,184    |           
|                                                                                                   | Escrow deposits and restricted cash                                                                                                                                             |                                                                                                               |                                                                                                                                        | 129,571                                                                                                 |              |         |            | 48,784     |           
|                                                                                                   | Investments in unconsolidated joint ventures                                                                                                                                    |                                                                                                               |                                                                                                                                        | 1,068,969                                                                                               |              |         |            | 1,117,143  |           
|                                                                                                   | Deferred financing costs (net of accumulated amortization of
    $54,612 and $59,748, respectively)                                                                             |                                                                                                               |                                                                                                                                        | 55,266                                                                                                  |              |         |            | 61,734     |           
|                                                                                                   | Deferred leasing costs and other related intangibles (net of
    accumulated amortization of $217,499 and $193,348, respectively)                                               |                                                                                                               |                                                                                                                                        | 460,566                                                                                                 |              |         |            | 450,625    |           
|                                                                                                   | Prepaid expenses and other assets                                                                                                                                               |                                                                                                               |                                                                                                                                        | 228,435                                                                                                 |              |         |            | 191,992    |           
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |        
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        | Total Assets                                                                                            |              | $       | 23,637,483 |            |            | $       | 24,671,539 | 
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |        
|                                                                                                  
|Liabilities, Minority Interests, Mandatorily Redeemable
    Preferred Units and Partners Capital:
|Liabilities:                                                                                       |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |         |            |           
|                                                                                                   | Mortgage debt (net of (discounts) of $(12,306) and
    $(13,683), respectively)                                                                                                 |                                                                                                               | $                                                                                                                                      | 2,286,662                                                                                               |              |         | $          | 2,609,067  |           
|                                                                                                   | Unsecured notes (net of (discounts) of $(15,236) and
    $(38,362), respectively)                                                                                               |                                                                                                               |                                                                                                                                        | 9,179,054                                                                                               |              |         |            | 9,652,392  |           
|                                                                                                   | Lines of credit                                                                                                                                                                 |                                                                                                               |                                                                                                                                        | 693,000                                                                                                 |              |         |            | 548,000    |           
|                                                                                                   | Accounts payable and accrued expenses                                                                                                                                           |                                                                                                               |                                                                                                                                        | 490,840                                                                                                 |              |         |            | 556,851    |           
|                                                                                                   | Distribution payable                                                                                                                                                            |                                                                                                               |                                                                                                                                        | 230,008                                                                                                 |              |         |            | 2,652      |           
|                                                                                                   | Other liabilities (net of (discounts) of $(27,067) and
    $(28,536), respectively)                                                                                             |                                                                                                               |                                                                                                                                        | 436,337                                                                                                 |              |         |            | 484,378    |           
|                                                                                                   | Commitments and contingencies                                                                                                                                                   |                                                                                                               |                                                                                                                                        |                                                                                                        |              |         |            |           |           
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |        
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        | Total Liabilities                                                                                       |              |         | 13,315,901 |            |            |         | 13,853,340 | 
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |        
|Minority interests  partially owned properties                                                    |                                                                                                                                                                                 |                                                                                                               | 173,884                                                                                                                                |                                                                                                         |              |         | 182,041    |           
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |        
|Mandatorily Redeemable Preferred Units:                                                            |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |         |            |           
|                                                                                                   | 5.25% Series B Convertible, Cumulative Redeemable Preferred
    Units, liquidation preference $50.00 per unit, 5,989,930
    and 5,990,000 issued and outstanding, respectively |                                                                                                               |                                                                                                                                        | 299,497                                                                                                 |              |         |            | 299,500    |           
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |        
|Partners Capital:                                                                                 |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |         |            |           
|                                                                                                   | Preferred Units, 100,000,000 authorized:                                                                                                                                        |                                                                                                               |                                                                                                                                        |                                                                                                         |              |         |            |            |           
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               | 7.75% Series G Cumulative Redeemable Preferred Units,
    liquidation preference $25.00 per unit, 8,500,000 issued
    and outstanding |                                                                                                         |              | 212,500 |            |            |            | 212,500 |           
|                                                                                                   | Other Partners Capital:                                                                                                                                                        |                                                                                                               |                                                                                                                                        |                                                                                                         |              |         |            |            |           
|                                                                                                   |                                                                                                                                                                                 | General Partner Capital                                                                                       |                                                                                                                                        |                                                                                                         | 71,877       |         |            |            | 76,973     |        
|                                                                                                   |                                                                                                                                                                                 | Limited Partners Capital                                                                                     |                                                                                                                                        |                                                                                                         | 9,624,519    |         |            |            | 10,112,024 |        
|                                                                                                   |                                                                                                                                                                                 | Deferred compensation                                                                                         |                                                                                                                                        |                                                                                                         | (1,114       | )       |            |            | (1,916     | )      
|                                                                                                   |                                                                                                                                                                                 | Accumulated other comprehensive loss (net of accumulated
    amortization of $8,541 and $5,133, respectively) |                                                                                                                                        |                                                                                                         | (59,581      | )       |            |            | (62,923    | )      
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |        
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        | Total Partners Capital                                                                                 |              |         | 9,848,201  |            |            |         | 10,336,658 | 
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |        
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        | Total Liabilities, Minority Interests, Mandatorily Redeemable
    Preferred Units and Partners Capital |              | $       | 23,637,483 |            |            | $       | 24,671,539 | 
|                                                                                                   |                                                                                                                                                                                 |                                                                                                               |                                                                                                                                        |                                                                                                         |              |        



2



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


CONSOLIDATED STATEMENTS OF OPERATIONS


(Unaudited)


|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |             |           |          |         |             |           |          |  
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------- | ---------------------------------------------------------------- | ---------------------------- | ----------- | ------------------------ | -------- | ------- | ----------- | -------- | -------- | -------- | ----------- | --------- | -------- | ------- | ----------- | --------- | -------- | -
|                                                                                                                                                                                                |                                                                                  | For the three months ended                                       |                              |             | For the six months ended |         
|                                                                                                                                                                                                |                                                                                  | June 30,                                                         |                              |             | June 30,                 |         
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |         
|(Dollars in thousands, except per unit amounts)                                                                                                                                                 |                                                                                  | 2005                                                             |                              |             | 2004                     |          |         | 2005        |          |          | 2004     |            
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|Revenues:                                                                                                                                                                                       |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |             |           |          |         |            
|                                                                                                                                                                                                | Rental                                                                           |                                                                  | $                            | 610,323     |                          |          | $       | 601,163     |          |          | $        | 1,213,978   |           |          | $       | 1,193,156   |          
|                                                                                                                                                                                                | Tenant reimbursements                                                            |                                                                  |                              | 94,992      |                          |          |         | 103,817     |          |          |          | 191,003     |           |          |         | 200,238     |          
|                                                                                                                                                                                                | Parking                                                                          |                                                                  |                              | 29,134      |                          |          |         | 27,427      |          |          |          | 57,272      |           |          |         | 54,867      |          
|                                                                                                                                                                                                | Other                                                                            |                                                                  |                              | 18,947      |                          |          |         | 12,674      |          |          |          | 77,718      |           |          |         | 37,630      |          
|                                                                                                                                                                                                | Fee income                                                                       |                                                                  |                              | 3,697       |                          |          |         | 3,849       |          |          |          | 8,474       |           |          |         | 6,909       |          
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|                                                                                                                                                                                                |                                                                                  | Total revenues                                                   |                              |             | 757,093                  |          |         |             | 748,930  |          |          |             | 1,548,445 |          |         |             | 1,492,800 |         
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|Expenses:                                                                                                                                                                                       |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |             |           |          |         |            
|                                                                                                                                                                                                | Depreciation                                                                     |                                                                  |                              | 171,582     |                          |          |         | 157,375     |          |          |          | 337,666     |           |          |         | 312,276     |          
|                                                                                                                                                                                                | Amortization                                                                     |                                                                  |                              | 22,788      |                          |          |         | 17,288      |          |          |          | 45,146      |           |          |         | 33,831      |          
|                                                                                                                                                                                                | Real estate taxes                                                                |                                                                  |                              | 88,904      |                          |          |         | 94,579      |          |          |          | 176,673     |           |          |         | 172,174     |          
|                                                                                                                                                                                                | Insurance                                                                        |                                                                  |                              | 8,038       |                          |          |         | 7,404       |          |          |          | 14,743      |           |          |         | 16,039      |          
|                                                                                                                                                                                                | Repairs and maintenance                                                          |                                                                  |                              | 82,031      |                          |          |         | 77,917      |          |          |          | 158,003     |           |          |         | 152,095     |          
|                                                                                                                                                                                                | Property operating                                                               |                                                                  |                              | 104,595     |                          |          |         | 96,901      |          |          |          | 208,687     |           |          |         | 197,460     |          
|                                                                                                                                                                                                | Ground rent                                                                      |                                                                  |                              | 5,262       |                          |          |         | 5,034       |          |          |          | 10,572      |           |          |         | 10,365      |          
|                                                                                                                                                                                                | Corporate general and administrative                                             |                                                                  |                              | 15,218      |                          |          |         | 13,709      |          |          |          | 32,391      |           |          |         | 25,018      |          
|                                                                                                                                                                                                | Impairment                                                                       |                                                                  |                              | 180,856     |                          |          |         |            |          |          |          | 180,856     |           |          |         |            |          
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|                                                                                                                                                                                                |                                                                                  | Total expenses                                                   |                              |             | 679,274                  |          |         |             | 470,207  |          |          |             | 1,164,737 |          |         |             | 919,258   |         
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|                                                                                                                                                                                                |                                                                                  | Operating income                                                 |                              |             | 77,819                   |          |         |             | 278,723  |          |          |             | 383,708   |          |         |             | 573,542   |         
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|Other income (expense):                                                                                                                                                                         |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |             |           |          |         |            
|                                                                                                                                                                                                | Interest and dividend income                                                     |                                                                  |                              | 3,646       |                          |          |         | 2,405       |          |          |          | 6,862       |           |          |         | 3,721       |          
|                                                                                                                                                                                                | Realized gain on settlement of derivatives and sale of
    marketable securities |                                                                  |                              |            |                          |          |         | 24,016      |          |          |          | 3           |           |          |         | 24,016      |          
|                                                                                                                                                                                                | Interest:                                                                        |                                                                  |                              |             |                          |          |         |             |          |          |          |             |           |          |         |             |          
|                                                                                                                                                                                                |                                                                                  | Expense incurred                                                 |                              |             | (207,932                 | )        |         |             | (208,684 | )        |          |             | (420,704  | )        |         |             | (412,819  | )       
|                                                                                                                                                                                                |                                                                                  | Amortization of deferred financing costs and prepayment expenses |                              |             | (2,597                   | )        |         |             | (2,175   | )        |          |             | (5,396    | )        |         |             | (4,312    | )       
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|                                                                                                                                                                                                |                                                                                  |                                                                  | Total other income (expense) |             |                          | (206,883 | )       |             |          | (184,438 | )        |             |           | (419,235 | )       |             |           | (389,394 | )
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|(Loss) income before income taxes, allocation to minority
    interests and income from investments in unconsolidated joint
    ventures                                                        |                                                                                  |                                                                  | (129,064                     | )           |                          |          | 94,285  |             |          |          | (35,527  | )           |           |          | 184,148 |            
|Income taxes                                                                                                                                                                                    |                                                                                  |                                                                  | (438                         | )           |                          |          | (1,333  | )           |          |          | (901     | )           |           |          | (1,069  | )          
|Minority interests  partially owned properties                                                                                                                                                 |                                                                                  |                                                                  | (2,503                       | )           |                          |          | (2,647  | )           |          |          | (5,527   | )           |           |          | (5,536  | )          
|Income from investments in unconsolidated joint ventures
    (including gain on sales of real estate of $17,376, $0, $17,376
    and $0, respectively)                                          |                                                                                  |                                                                  | 28,681                       |             |                          |          | 12,554  |             |          |          | 38,199   |             |           |          | 24,967  |            
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|(Loss) income from continuing operations                                                                                                                                                        |                                                                                  |                                                                  | (103,324                     | )           |                          |          | 102,859 |             |          |          | (3,756   | )           |           |          | 202,510 |            
|Discontinued operations (including net (loss) gain on sales of
    real estate and provision for loss on properties held for sale
    of $(94,220), $1,927, $(83,513) and $4,122, respectively) |                                                                                  |                                                                  | (117,094                     | )           |                          |          | 18,759  |             |          |          | (95,337  | )           |           |          | 38,793  |            
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|(Loss) income before cumulative effect of a change in accounting
    principle                                                                                                                  |                                                                                  |                                                                  | (220,418                     | )           |                          |          | 121,618 |             |          |          | (99,093  | )           |           |          | 241,303 |            
|Cumulative effect of a change in accounting principle                                                                                                                                           |                                                                                  |                                                                  |                             |             |                          |          |        |             |          |          |         |             |           |          | (33,697 | )          
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|Net (loss) income                                                                                                                                                                               |                                                                                  |                                                                  | (220,418                     | )           |                          |          | 121,618 |             |          |          | (99,093  | )           |           |          | 207,606 |            
|Preferred distributions                                                                                                                                                                         |                                                                                  |                                                                  | (8,701                       | )           |                          |          | (8,944  | )           |          |          | (17,402  | )           |           |          | (21,692 | )          
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|Net (loss) income available to unitholders                                                                                                                                                      |                                                                                  | $                                                                | (229,119                     | )           |                          | $        | 112,674 |             |          | $        | (116,495 | )           |           | $        | 185,914 |            
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|(Loss) earnings per unit  basic:                                                                                                                                                               |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |             |           |          |         |            
|                                                                                                                                                                                                | (Loss) income from continuing operations per unit                                |                                                                  | $                            | (0.25       | )                        |          | $       | 0.21        |          |          | $        | (0.05       | )         |          | $       | 0.40        |          
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|                                                                                                                                                                                                | Net (loss) income available to unitholders per unit                              |                                                                  | $                            | (0.51       | )                        |          | $       | 0.25        |          |          | $        | (0.26       | )         |          | $       | 0.41        |          
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|                                                                                                                                                                                                | Weighted average Units outstanding                                               |                                                                  |                              | 451,728,242 |                          |          |         | 449,245,505 |          |          |          | 450,881,385 |           |          |         | 448,902,096 |          
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|(Loss) earnings per unit  diluted:                                                                                                                                                             |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |             |           |          |         |            
|                                                                                                                                                                                                | (Loss) income from continuing operations per unit                                |                                                                  | $                            | (0.25       | )                        |          | $       | 0.21        |          |          | $        | (0.05       | )         |          | $       | 0.40        |          
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|                                                                                                                                                                                                | Net (loss) income available to unitholders per unit                              |                                                                  | $                            | (0.51       | )                        |          | $       | 0.25        |          |          | $        | (0.26       | )         |          | $       | 0.41        |          
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|                                                                                                                                                                                                | Weighted average Units outstanding and dilutive potential units                  |                                                                  |                              | 451,728,242 |                          |          |         | 450,533,841 |          |          |          | 450,881,385 |           |          |         | 450,840,364 |          
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|Distributions declared per Unit outstanding                                                                                                                                                     |                                                                                  | $                                                                | 0.50                         |             |                          | $        | 0.50    |             |          | $        | 1.00     |             |           | $        | 1.00    |            
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|Allocation of net income available to unitholders:                                                                                                                                              |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |             |           |          |         |            
|                                                                                                                                                                                                | General Partner                                                                  |                                                                  | $                            | (2,291      | )                        |          | $       | 1,127       |          |          | $        | (1,165      | )         |          | $       | 1,859       |          
|                                                                                                                                                                                                | Limited Partners                                                                 |                                                                  |                              | (226,828    | )                        |          |         | 111,547     |          |          |          | (115,330    | )         |          |         | 184,055     |          
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            
|                                                                                                                                                                                                | Net income available to unitholders                                              |                                                                  | $                            | (229,119    | )                        |          | $       | 112,674     |          |          | $        | (116,495    | )         |          | $       | 185,914     |          
|                                                                                                                                                                                                |                                                                                  |                                                                  |                              |             |                          |          |         |             |          |          |          |            



3



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


CONSOLIDATED STATEMENTS OF NET COMPREHENSIVE (LOSS) INCOME


(Unaudited)


|                                   |                                                                                                                                          |                      |          |       |                          |   |         |         |   |   |         |       |   |   |         |         |  
|---------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------- | -------------------- | -------- | ----- | ------------------------ | - | ------- | ------- | - | - | ------- | ----- | - | - | ------- | ------- | -
|                                   |                                                                                                                                          | For the three months |          |       | For the six months ended |  
|                                   |                                                                                                                                          | ended June 30,       |          |       | June 30,                 |  
|                                   |                                                                                                                                          |                      |          |       |                          |  
|(Dollars in thousands)             |                                                                                                                                          | 2005                 |          |       | 2004                     |   |         | 2005    |   |   | 2004    |      
|                                   |                                                                                                                                          |                      |          |       |                          |   |         |         |   |   |         |      
|Net (loss) income                  |                                                                                                                                          | $                    | (220,418 | )     |                          | $ | 121,618 |         |   | $ | (99,093 | )     |   | $ | 207,606 |        
|Other comprehensive income (loss): |                                                                                                                                          |                      |          |       |                          |   |         |         |   |   |         |       |   |   |         |        
|                                   | Unrealized holding gains (losses) on $1.3 billion notional
    amount forward starting interest rate swaps                               |                      |          |      |                          |   |         | 35,531  |   |   |         |      |   |   |         | (34,666 | )
|                                   | Reversal of unrealized holding (gains) losses on settlement
    of $1.3 billion notional amount forward starting interest
    rate swaps |                      |          |      |                          |   |         | (24,016 | ) |   |         |      |   |   |         | 45,114  |  
|                                   | (Payments) in settlement of $800 million notional amount
    forward starting interest rate swaps                                        |                      |          |      |                          |   |         |        |   |   |         |      |   |   |         | (69,130 | )
|                                   | Reclassification of ineffective portion of swap settlement
    payment to net income                                                     |                      |          |      |                          |   |         |        |   |   |         |      |   |   |         | 212     |  
|                                   | Amortization of net payments in settlement of forward starting
    interest rate swaps                                                   |                      |          | 1,704 |                          |   |         | 1,703   |   |   |         | 3,408 |   |   |         | 1,799   |  
|                                   | Unrealized holding (losses) from investments arising during the
    period                                                               |                      |          | (26   | )                        |   |         | (160    | ) |   |         | (65   | ) |   |         | (24     | )
|                                   |                                                                                                                                          |                      |          |       |                          |   |         |         |   |   |         |      
|Net comprehensive (loss) income    |                                                                                                                                          | $                    | (218,740 | )     |                          | $ | 134,676 |         |   | $ | (95,750 | )     |   | $ | 150,911 |        
|                                   |                                                                                                                                          |                      |          |       |                          |   |         |         |   |   |         |      



4



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


CONSOLIDATED STATEMENTS OF CASH FLOWS


(Unaudited)


|                       |                                                                                              |                                                                                                  |                                                              |                                           |                          |         |         |          |         |         |         |           |         |         |         |          |          |         |         | 
|---------------------- | -------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------ | ------------------------------------------------------------ | ----------------------------------------- | ------------------------ | ------- | ------- | -------- | ------- | ------- | ------- | --------- | ------- | ------- | ------- | -------- | -------- | ------- | ------- | 
|                       |                                                                                              | For the three months ended                                                                       |                                                              |                                           | For the six months ended |        
|                       |                                                                                              | June 30,                                                                                         |                                                              |                                           | June 30,                 |        
|                       |                                                                                              |                                                                                                  |                                                              |                                           |                          |        
|(Dollars in thousands) |                                                                                              | 2005                                                                                             |                                                              |                                           | 2004                     |         |         | 2005     |         |         | 2004    |          
|                       |                                                                                              |                                                                                                  |                                                              |                                           |                          |         |         |          |         |         |         |          
|Operating Activities:  |                                                                                              |                                                                                                  |                                                              |                                           |                          |         |         |          |         |         |         |           |         |         |         |         
|                       | Net (loss) income                                                                            |                                                                                                  | $                                                            | (220,418                                  | )                        |         | $       | 121,618  |         |         | $       | (99,093   | )       |         | $       | 207,606  |         
|                       | Adjustments to reconcile net (loss) income to net cash provided
    by operating activities: |                                                                                                  |                                                              |                                           |                          |         |         |          |         |         |         |           |         |         |         |          |         
|                       |                                                                                              | Depreciation and amortization (including discontinued operations)                                |                                                              |                                           | 208,077                  |         |         |          | 193,039 |         |         |           | 414,513 |         |         |          | 380,998  |        
|                       |                                                                                              | Ineffective portion of swap settlement payment included in
    interest expense                  |                                                              |                                           |                         |         |         |          |        |         |         |           |        |         |         |          | 212      |        
|                       |                                                                                              | Compensation expense related to restricted shares and stock
    options                          |                                                              |                                           | 5,917                    |         |         |          | 4,812   |         |         |           | 13,322  |         |         |          | 10,245   |        
|                       |                                                                                              | Prepayment penalty on early extinguishment of debt in connection
    with a property disposition |                                                              |                                           |                         |         |         |          |        |         |         |           | 448     |         |         |          |         |        
|                       |                                                                                              | Income from investments in unconsolidated joint ventures                                         |                                                              |                                           | (28,681                  | )       |         |          | (12,554 | )       |         |           | (38,199 | )       |         |          | (24,967  | )      
|                       |                                                                                              | Net distributions from unconsolidated joint ventures                                             |                                                              |                                           | 17,506                   |         |         |          | 16,967  |         |         |           | 23,610  |         |         |          | 25,016   |        
|                       |                                                                                              | Net loss (gain) on sales of real estate and provision for
    loss on properties held for sale   |                                                              |                                           | 94,220                   |         |         |          | (1,927  | )       |         |           | 83,513  |         |         |          | (4,122   | )      
|                       |                                                                                              | Impairment                                                                                       |                                                              |                                           | 180,856                  |         |         |          |        |         |         |           | 180,856 |         |         |          |         |        
|                       |                                                                                              | Cumulative effect of a change in accounting principle                                            |                                                              |                                           |                         |         |         |          |        |         |         |           |        |         |         |          | 33,697   |        
|                       |                                                                                              | Provision for doubtful accounts                                                                  |                                                              |                                           | 1,114                    |         |         |          | 1,543   |         |         |           | 3,529   |         |         |          | 739      |        
|                       |                                                                                              | Income allocated to minority interests (including discontinued
    operations)                   |                                                              |                                           | 32,486                   |         |         |          | 2,915   |         |         |           | 35,967  |         |         |          | 6,131    |        
|                       |                                                                                              | Changes in assets and liabilities:                                                               |                                                              |                                           |                          |         |         |          |         |         |         |           |         |         |         |          |          |        
|                       |                                                                                              |                                                                                                  | Decrease in rent receivable                                  |                                           |                          | 344     |         |          |         | 10,547  |         |           |         | 509     |         |          |          | 10,508  |        
|                       |                                                                                              |                                                                                                  | (Increase) in deferred rent receivable                       |                                           |                          | (19,193 | )       |          |         | (23,925 | )       |           |         | (36,675 | )       |          |          | (52,386 | )      
|                       |                                                                                              |                                                                                                  | Decrease (increase) in prepaid expenses and other assets     |                                           |                          | 17,202  |         |          |         | (6,531  | )       |           |         | (23,502 | )       |          |          | 51,072  |        
|                       |                                                                                              |                                                                                                  | Increase (decrease) in accounts payable and accrued expenses |                                           |                          | 33,254  |         |          |         | 58,115  |         |           |         | (59,768 | )       |          |          | (58,004 | )      
|                       |                                                                                              |                                                                                                  | (Decrease) in other liabilities                              |                                           |                          | (23,531 | )       |          |         | (21,611 | )       |           |         | (30,702 | )       |          |          | (20,014 | )      
|                       |                                                                                              |                                                                                                  |                                                              |                                           |                          |         |         |          |         |         |         |          
|                       |                                                                                              |                                                                                                  |                                                              | Net cash provided by operating activities |                          |         | 299,153 |          |         |         | 343,008 |           |         |         | 468,328 |          |          |         | 566,731 | 
|                       |                                                                                              |                                                                                                  |                                                              |                                           |                          |         |         |          |         |         |         |          
|Investing Activities:  |                                                                                              |                                                                                                  |                                                              |                                           |                          |         |         |          |         |         |         |           |         |         |         |         
|                       | Deposits made for future property acquisitions                                               |                                                                                                  |                                                              | (59,747                                   | )                        |         |         | (2,500   | )       |         |         | (63,756   | )       |         |         | (2,500   | )       
|                       | Property acquisitions                                                                        |                                                                                                  |                                                              | (234,331                                  | )                        |         |         | (54,204  | )       |         |         | (301,030  | )       |         |         | (116,981 | )       
|                       | Deposits received for future property dispositions                                           |                                                                                                  |                                                              | 2,000                                     |                          |         |         |         |         |         |         | 4,000     |         |         |         |         |         
|                       | Property dispositions                                                                        |                                                                                                  |                                                              | 1,167,669                                 |                          |         |         | 215,280  |         |         |         | 1,304,778 |         |         |         | 233,469  |         
|                       | Distributions from unconsolidated joint ventures                                             |                                                                                                  |                                                              | 62,301                                    |                          |         |         |         |         |         |         | 62,301    |         |         |         |         |         
|                       | Capital and tenant improvements                                                              |                                                                                                  |                                                              | (74,557                                   | )                        |         |         | (122,160 | )       |         |         | (150,963  | )       |         |         | (243,549 | )       
|                       | Lease commissions and other costs                                                            |                                                                                                  |                                                              | (29,381                                   | )                        |         |         | (29,051  | )       |         |         | (53,750   | )       |         |         | (60,875  | )       
|                       | Decrease in escrow deposits and restricted cash                                              |                                                                                                  |                                                              | 2,696                                     |                          |         |         | 15,144   |         |         |         | 133,630   |         |         |         | 47,211   |         
|                       |                                                                                              |                                                                                                  |                                                              |                                           |                          |         |         |          |         |         |         |          
|                       |                                                                                              | Net cash provided by (used for) investing activities                                             |                                                              |                                           | 836,650                  |         |         |          | 22,509  |         |         |           | 935,210 |         |         |          | (143,225 | )      
|                       |                                                                                              |                                                                                                  |                                                              |                                           |                          |         |         |          |         |         |         |          





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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


CONSOLIDATED STATEMENTS OF CASH
FLOWS  (Continued)


(Unaudited)


|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |            |          |   |   |            |          |          |  
|-------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------- | ---------- | ------------------------ | - | - | ---------- | -------- | - | ---- | ---------- | -------- | - | - | ---------- | -------- | -------- | -
|                                             |                                                                                                                                                        | For the three months ended                                                                                                                    |                                                         |            | For the six months ended |  
|                                             |                                                                                                                                                        | June 30,                                                                                                                                      |                                                         |            | June 30,                 |  
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |  
|(Dollars in thousands)                       |                                                                                                                                                        | 2005                                                                                                                                          |                                                         |            | 2004                     |   |   | 2005       |          |   | 2004 |           
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           
|Financing Activities:                        |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |            |          |   |   |           
|                                             | Proceeds from mortgage debt                                                                                                                            |                                                                                                                                               |                                                         | 150        |                          |   |   |           |          |   |      | 150        |          |   |   |           |         
|                                             | Principal payments on mortgage debt                                                                                                                    |                                                                                                                                               |                                                         | (251,764   | )                        |   |   | (36,950    | )        |   |      | (355,521   | )        |   |   | (209,239   | )       
|                                             | Proceeds from unsecured notes                                                                                                                          |                                                                                                                                               |                                                         | 14,025     |                          |   |   | 49,035     |          |   |      | 28,369     |          |   |   | 1,040,275  |         
|                                             | Repayment of unsecured notes                                                                                                                           |                                                                                                                                               |                                                         |           |                          |   |   | (450,000   | )        |   |      | (525,000   | )        |   |   | (850,000   | )       
|                                             | Proceeds from lines of credit                                                                                                                          |                                                                                                                                               |                                                         | 1,877,600  |                          |   |   | 1,437,400  |          |   |      | 4,000,600  |          |   |   | 2,886,000  |         
|                                             | Repayment of lines of credit                                                                                                                           |                                                                                                                                               |                                                         | (2,053,600 | )                        |   |   | (1,066,900 | )        |   |      | (3,855,600 | )        |   |   | (2,843,700 | )       
|                                             | Payments of loan costs and offering costs                                                                                                              |                                                                                                                                               |                                                         | 6          |                          |   |   | (223       | )        |   |      | (59        | )        |   |   | (1,548     | )       
|                                             | Settlement of interest rate swap agreements                                                                                                            |                                                                                                                                               |                                                         |           |                          |   |   |           |          |   |      |           |          |   |   | (69,130    | )       
|                                             | Distributions to minority interests in partially owned properties                                                                                      |                                                                                                                                               |                                                         | (2,158     | )                        |   |   | (14,007    | )        |   |      | (7,860     | )        |   |   | (16,111    | )       
|                                             | Proceeds from exercise of stock options                                                                                                                |                                                                                                                                               |                                                         | 78,282     |                          |   |   | 747        |          |   |      | 121,542    |          |   |   | 39,803     |         
|                                             | Distributions to unitholders                                                                                                                           |                                                                                                                                               |                                                         | (226,758   | )                        |   |   | (224,408   | )        |   |      | (226,758   | )        |   |   | (225,244   | )       
|                                             | Repurchase of Units through Equity Offices common share
    repurchase program                                                                        |                                                                                                                                               |                                                         | (5,029     | )                        |   |   | (32,808    | )        |   |      | (7,758     | )        |   |   | (36,583    | )       
|                                             | Redemption of Units                                                                                                                                    |                                                                                                                                               |                                                         | (44,810    | )                        |   |   | (1,071     | )        |   |      | (50,676    | )        |   |   | (1,866     | )       
|                                             | Repurchase of preferred units                                                                                                                          |                                                                                                                                               |                                                         |           |                          |   |   |           |          |   |      |           |          |   |   | (114,073   | )       
|                                             | Payment of preferred distributions                                                                                                                     |                                                                                                                                               |                                                         | (8,048     | )                        |   |   | (8,049     | )        |   |      | (16,096    | )        |   |   | (16,671    | )       
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           
|                                             |                                                                                                                                                        | Net cash (used for) financing activities                                                                                                      |                                                         |            | (622,104                 | ) |   |            | (347,234 | ) |      |            | (894,667 | ) |   |            | (418,087 | )       
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           
|                                             | Net increase in cash and cash equivalents                                                                                                              |                                                                                                                                               |                                                         | 513,699    |                          |   |   | 18,283     |          |   |      | 508,871    |          |   |   | 5,419      |         
|                                             | Cash and cash equivalents at the beginning of the period                                                                                               |                                                                                                                                               |                                                         | 102,298    |                          |   |   | 56,534     |          |   |      | 107,126    |          |   |   | 69,398     |         
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           
|                                             | Cash and cash equivalents at the end of the period                                                                                                     |                                                                                                                                               | $                                                       | 615,997    |                          |   | $ | 74,817     |          |   | $    | 615,997    |          |   | $ | 74,817     |         
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           
|Supplemental Information:                    |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |            |          |   |   |           
|                                             | Interest paid during the period, including a reduction of
    interest expense for capitalized interest of $4, $1,633, $4 and
    $3,663, respectively |                                                                                                                                               | $                                                       | 158,689    |                          |   | $ | 166,486    |          |   | $    | 429,109    |          |   | $ | 414,971    |         
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           
|Non-Cash Investing and Financing Activities: |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |            |          |   |   |           
|                                             | Investing Activities:                                                                                                                                  |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |            |          |   |   |            |         
|                                             |                                                                                                                                                        | Escrow deposits related to property dispositions                                                                                              |                                                         | $          | (8,811                   | ) |   | $          | (30,616  | ) |      | $          | (150,324 | ) |   | $          | (30,616  | )       
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           
|                                             |                                                                                                                                                        | Mortgage loan repayment as a result of a property disposition
    (including prepayment expense of $375 in 2004)                              |                                                         | $          |                         |   |   | $          | (5,830   | ) |      | $          | (13,386  | ) |   | $          | (5,830   | )       
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           
|                                             |                                                                                                                                                        | Units issued in connection with a property acquisition                                                                                        |                                                         | $          | 3,339                    |   |   | $          | 50       |   |      | $          | 3,339    |   |   | $          | 50       |         
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           
|                                             |                                                                                                                                                        | Mortgage loan assumed upon acquisition of property                                                                                            |                                                         | $          | 44,975                   |   |   | $          |         |   |      | $          | 44,975   |   |   | $          | 82,970   |         
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           
|                                             |                                                                                                                                                        | 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   |  
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           
|                                             | Financing Activities:                                                                                                                                  |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |            |          |   |   |            |         
|                                             |                                                                                                                                                        | Mortgage loan repayment as a result of a property disposition
    (including prepayment expense of $375 in 2004)                              |                                                         | $          |                         |   |   | $          | 5,830    |   |      | $          | 13,386   |   |   | $          | 5,830    |         
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           
|                                             |                                                                                                                                                        | Mortgage loan assumed upon acquisition of property                                                                                            |                                                         | $          | (44,975                  | ) |   | $          |         |   |      | $          | (44,975  | ) |   | $          | (82,970  | )       
|                                             |                                                                                                                                                        |                                                                                                                                               |                                                         |            |                          |   |   |            |          |   |      |           





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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(Unaudited)






|         |                            
|-------- | ---------------------------
|NOTE 1  | BUSINESS OF EOP PARTNERSHIP





|                              |       |           |     |                        |             |  |                            |             |  |  |             |             |  |             |            |             |  |  |            |            | 
|----------------------------- | ----- | --------- | --- | ---------------------- | ----------- |  | -------------------------- | ----------- |  |  | ----------- | ----------- |  | ----------- | ---------- | ----------- |  |  | ---------- | ---------- | 
|                              |       |           |     | Total Office Portfolio |             |  | Effective Office Portfolio |            
|                              |       |           |     |                        |             |  |                            |            
|                              |       | Number of |     |                        |             |  | Occupied                   |             |  |  |             | Occupied    | 
|                              |       | Buildings |     |                        | Square Feet |  |                            | Square Feet |  |  | Square Feet |             |  | Square Feet |           
|                              |       |           |     |                        |             |  |                            |             |  |  |             |             |  |             |           
|Wholly-Owned Properties       |       |           | 580 |                        |             |  | 90,512,718                 |             |  |  | 79,482,919  |             |  |             | 90,512,718 |             |  |  | 79,482,919 |           
|Consolidated Joint Ventures   |       |           | 25  |                        |             |  | 12,705,286                 |             |  |  | 11,943,806  |             |  |             | 11,545,255 |             |  |  | 10,887,192 |           
|Unconsolidated Joint Ventures |       |           | 38  |                        |             |  | 14,699,401                 |             |  |  | 12,849,165  |             |  |             | 5,862,488  |             |  |  | 5,004,172  |           
|                              |       |           |     |                        |             |  |                            |             |  |  |             |             |  |             |           
|                              | Total |           |     | 643                    |             |  |                            | 117,917,405 |  |  |             | 104,275,890 |  |             |            | 107,920,461 |  |  |            | 95,374,283 | 
|                              |       |           |     |                        |             |  |                            |             |  |  |             |             |  |             |           
|Weighted Average Occupancy    |       |           |     |                        |             |  |                            |             |  |  | 88.4        | %           |  |             |            |             |  |  | 88.4       | %         
|                              |       |           |     |                        |             |  |                            |             |  |  |             |             |  |             |           
|Weighted Average Leased       |       |           |     |                        |             |  |                            |             |  |  | 90.6        | %           |  |             |            |             |  |  | 90.5       | %         
|                              |       |           |     |                        |             |  |                            |             |  |  |             |             |  |             |           



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



| |                      
| | ---------------------
| | Basis of Presentation



7



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)


Consolidation of Variable Interest Entities


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




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





| |                             
| | ----------------------------
| | Unaudited Interim Statements





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





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

Accounting for
Stock Based Compensation


8



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)


Accounting for Stock Issued to Employees


|                                                                                                                      |                                                                |                    |          |       |                  |   |         |      |  |   |          |       |   |   |         |      | 
|--------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------- | ------------------ | -------- | ----- | ---------------- | - | ------- | ---- |  | - | -------- | ----- | - | - | ------- | ---- | 
|                                                                                                                      |                                                                | For the            |          |       | For the          |  
|                                                                                                                      |                                                                | three months ended |          |       | six months ended |  
|                                                                                                                      |                                                                | June 30,           |          |       | June 30,         |  
|                                                                                                                      |                                                                |                    |          |       |                  |  
|(Dollars in thousands, except per unit amounts)                                                                       |                                                                | 2005               |          |       | 2004             |   |         | 2005 |  |   | 2004     |      
|                                                                                                                      |                                                                |                    |          |       |                  |   |         |      |  |   |          |      
|Historical net (loss) income available to unitholders                                                                 |                                                                | $                  | (229,119 | )     |                  | $ | 112,674 |      |  | $ | (116,495 | )     |   | $ | 185,914 |     
|Add back compensation expense for share options included in
    historical net (loss) income available to unitholders |                                                                |                    | 1,710    |       |                  |   | 1,257   |      |  |   | 3,337    |       |   |   | 2,862   |     
|Deduct compensation expense for share options determined under
    fair value based method                            |                                                                |                    | (1,726   | )     |                  |   | (2,284  | )    |  |   | (3,833   | )     |   |   | (5,177  | )   
|                                                                                                                      |                                                                |                    |          |       |                  |   |         |      |  |   |          |      
|Pro forma net (loss) income available to unitholders                                                                  |                                                                | $                  | (229,135 | )     |                  | $ | 111,647 |      |  | $ | (116,991 | )     |   | $ | 183,599 |     
|                                                                                                                      |                                                                |                    |          |       |                  |   |         |      |  |   |          |      
|(Loss) earnings per unit  basic:                                                                                     |                                                                |                    |          |       |                  |   |         |      |  |   |          |       |   |   |         |     
|                                                                                                                      | Historical net (loss) income available to unitholders per unit |                    | $        | (0.51 | )                |   | $       | 0.25 |  |   | $        | (0.26 | ) |   | $       | 0.41 | 
|                                                                                                                      |                                                                |                    |          |       |                  |   |         |      |  |   |          |      
|                                                                                                                      | Pro forma net (loss) income available to unitholders per unit  |                    | $        | (0.51 | )                |   | $       | 0.25 |  |   | $        | (0.26 | ) |   | $       | 0.41 | 
|                                                                                                                      |                                                                |                    |          |       |                  |   |         |      |  |   |          |      
|(Loss) earnings per unit  diluted:                                                                                   |                                                                |                    |          |       |                  |   |         |      |  |   |          |       |   |   |         |     
|                                                                                                                      | Historical net (loss) income available to unitholders per unit |                    | $        | (0.51 | )                |   | $       | 0.25 |  |   | $        | (0.26 | ) |   | $       | 0.41 | 
|                                                                                                                      |                                                                |                    |          |       |                  |   |         |      |  |   |          |      
|                                                                                                                      | Pro forma net (loss) income available to unitholders per unit  |                    | $        | (0.51 | )                |   | $       | 0.25 |  |   | $        | (0.26 | ) |   | $       | 0.41 | 
|                                                                                                                      |                                                                |                    |          |       |                  |   |         |      |  |   |          |      

Share-Based
Payment




| |                                    
| | -----------------------------------
| | Impact of a New Accounting Standard

Determining Whether a General Partner, or the
General Partners as a Group, Controls a Limited Partnership or
Similar Entity When the Limited Partners Have Certain Rights


9



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)






|         |             
|-------- | ------------
|NOTE 3  | ACQUISITIONS



|                                  |                                                |                                   |                  |             |    |            |           |                                      |           |                        |  |   |                |         |  |  |   |        | 
|--------------------------------- | ---------------------------------------------- | --------------------------------- | ---------------- | ----------- | -- | ---------- | --------- | ------------------------------------ | --------- | ---------------------- |  | - | -------------- | ------- |  |  | - | ------ | 
|                                  |                                                |                                   |                  |             |    |            |           | Total Office Portfolio and Effective |          
|                                  |                                                |                                   |                  |             |    |            |           | Office Portfolio                     |          
|                                  |                                                |                                   |                  | Acquisition |    |            | Number of |                                      |           |                        | 
|Property                          |                                                | Location                          |                  | Date        |    |            | Buildings |                                      |           | Square Feet            |  |   | Purchase Price |        
|                                  |                                                |                                   |                  |             |    |            |           |                                      |           |                        |  |   |                |        
|                                  |                                                |                                   |                  |             |    |            |           |                                      |           | (Dollars in thousands) | 
|First Quarter 2005 Acquisitions:  |                                                |                                   |                  |             |    |            |           |                                      |           |                        |  |   |                |         |  |  |   |       
|Office properties:                |                                                |                                   |                  |             |    |            |           |                                      |           |                        |  |   |                |         |  |  |   |       
|                                  | Summit at Douglas Ridge I                      |                                   | Roseville, CA    |             |    | 01/21/2005 |           |                                      |           | 1                      |  |   |                | 92,941  |  |  | $ | 25,000 | 
|                                  | Park 22                                        |                                   | Austin, TX       |             |    | 03/22/2005 |           |                                      |           | 3                      |  |   |                | 203,716 |  |  |   | 35,650 | 
|Vacant land:                      |                                                |                                   |                  |             |    |            |           |                                      |           |                        |  |   |                |         |  |  |   |       
|                                  | Two Main Place                                 |                                   | Portland, OR     |             |    | 03/14/2005 |           |                                      |           |                       |  |   |                |        |  |  |   | 7,600  | 
|                                  |                                                |                                   |                  |             |    |            |           |                                      |           |                        |  |   |                |        
|                                  |                                                | Total First Quarter Acquisitions  |                  |             | 4  |            |           |                                      | 296,657   |                        |  |   | 68,250         |        
|                                  |                                                |                                   |                  |             |    |            |           |                                      |           |                        | 
|Second Quarter 2005 Acquisitions: |                                                |                                   |                  |             |    |            |           |                                      |           |                        |  |   |                |         |  |  |   |       
|Office properties:                |                                                |                                   |                  |             |    |            |           |                                      |           |                        |  |   |                |         |  |  |   |       
|                                  | 11111 Sunset Hills Road (a/k/a XO Building)(a) |                                   | Reston, VA       |             |    | 05/04/2005 |           |                                      |           | 1                      |  |   |                | 216,469 |  |  |   | 50,700 | 
|                                  | Summit at Douglas Ridge II(b)                  |                                   | Roseville, CA    |             |    | 05/20/2005 |           |                                      |           |                       |  |   |                |        |  |  |   | 18,650 | 
|                                  | Shorebreeze I & II(c)                          |                                   | Redwood City, CA |             |    | 06/09/2005 |           |                                      |           | 2                      |  |   |                | 230,853 |  |  |   | 56,500 | 
|                                  | Austin Research Park I & II                    |                                   | Austin, TX       |             |    | 06/16/2005 |           |                                      |           | 2                      |  |   |                | 271,882 |  |  |   | 55,000 | 
|                                  | Golden Gate Plaza                              |                                   | Novato, CA       |             |    | 06/30/2005 |           |                                      |           | 2                      |  |   |                | 114,364 |  |  |   | 24,499 | 
|                                  | Woodside Office Center                         |                                   | Novato, CA       |             |    | 06/30/2005 |           |                                      |           | 1                      |  |   |                | 89,031  |  |  |   | 23,950 | 
|                                  | McDowell Corporate Campus                      |                                   | Petaluma, CA     |             |    | 06/30/2005 |           |                                      |           | 1                      |  |   |                | 53,846  |  |  |   | 9,200  | 
|                                  | Parkway Plaza (a/k/a 3850 & 3880 Brickway)     |                                   | Santa Rosa, CA   |             |    | 06/30/2005 |           |                                      |           | 2                      |  |   |                | 126,585 |  |  |   | 23,734 | 
|                                  | Oak Valley Business Center                     |                                   | Santa Rosa, CA   |             |    | 06/30/2005 |           |                                      |           | 3                      |  |   |                | 129,523 |  |  |   | 24,450 | 
|                                  |                                                |                                   |                  |             |    |            |           |                                      |           |                        |  |   |                |        
|                                  |                                                | Total Second Quarter Acquisitions |                  |             | 14 |            |           |                                      | 1,232,553 |                        |  |   | 286,683        |        
|                                  |                                                |                                   |                  |             |    |            |           |                                      |           |                        | 
|                                  |                                                | Total                             |                  |             | 18 |            |           |                                      | 1,529,210 |                        |  | $ | 354,933        |        
|                                  |                                                |                                   |                  |             |    |            |           |                                      |           |                        | 






|    |                                                                                                                                                                                                                                                             
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | The purchase price for 11111 Sunset Hills Road includes the
    assumption of approximately $22.5 million of mortgage debt
    at a fixed coupon rate of 6.12% maturing in July 2008. The
    all-in effective interest rate of this mortgage debt is 4.97%.



|    |  |                                                                                                                                                                                                                                                          
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(b) |  | Summit at Douglas Ridge II, which consists of one building
    comprising approximately 93,349 square feet, is currently a
    development property and, therefore, not included in the total
    number of buildings or total square footage statistics.

10



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




|    |  |                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(c) |  | The purchase price for Shorebreeze I & II includes
    the assumption of approximately $22.4 million of mortgage
    debt at a fixed coupon rate of 4.19% and the issuance of 108,190
    partnership units in EOP Partnership (Units) valued
    at approximately $3.3 million. The mortgage debt assumed
    matures in March 2007 and has an all-in effective interest rate
    of 5.43%.



|         |                                                                                
|-------- | -------------------------------------------------------------------------------
|NOTE 4  | IMPAIRMENTS, GAINS/ LOSSES ON SALES OF REAL ESTATE AND ASSETS
    HELD FOR SALE

Accounting for the
Impairment or Disposal of Long Lived Assets






|                                          |                                                                                                                             |                                                                                              |                                        |          |          |          |  
|----------------------------------------- | --------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------- | -------------------------------------- | -------- | -------- | -------- | -
|(Dollars in thousands)                    |                                                                                                                             |                                                                                             
|                                          |                                                                                                                             |                                                                                             
|For the three months ended March 31, 2005 |                                                                                                                             |                                                                                              |                                        |         
|                                          | Provision for loss on properties held for sale as of
    March 31, 2005 and subsequently sold                               |                                                                                              | $                                      | (13,538  | )       
|                                          |                                                                                                                             |                                                                                              |                                       
|For the three months ended June 30, 2005  |                                                                                                                             |                                                                                              |                                        |         
|                                          | Impairment on properties anticipated to be sold after
    June 30, 2005 deducted from Income from Continuing
    Operations |                                                                                              |                                        | (180,856 | )       
|                                          | Discontinued Operations:                                                                                                    |                                                                                              |                                        |          |         
|                                          |                                                                                                                             | Loss on sales of real estate for assets sold during the three
    months ended June 30, 2005 |                                        |          | (165,927 | )       
|                                          |                                                                                                                             | Provision for loss on properties held for sale as of
    June 30, 2005 and subsequently sold |                                        |          | (20,264  | )       
|                                          |                                                                                                                             |                                                                                              |                                       
|                                          |                                                                                                                             | For the three months ended June 30, 2005                                                     |                                        |          | (367,047 | )       
|                                          |                                                                                                                             |                                                                                              |                                       
|                                          |                                                                                                                             |                                                                                              | For the six months ended June 30, 2005 |          | $        | (380,585 | )
|                                          |                                                                                                                             |                                                                                              |                                       

11



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




|                                                                 |                                                                                                                                                                                   |                                        |        |         |         | 
|---------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------- | ------ | ------- | ------- | 
|(Dollars in thousands)                                           |                                                                                                                                                                                   |                                       
|                                                                 |                                                                                                                                                                                   |                                       
|For the three months ended March 31, 2005:                       |                                                                                                                                                                                   |                                        |        |        
|                                                                 | Gain on sales of real estate included in Discontinued Operations                                                                                                                  |                                        | $      | 24,245  |        
|                                                                 |                                                                                                                                                                                   |                                        |       
|For the three months ended June 30, 2005:                        |                                                                                                                                                                                   |                                        |        |        
|Gain on sales of real estate included in Discontinued Operations |                                                                                                                                                                                   |                                        | 91,971 |        
|                                                                 | Minority interests share in gains on sales of real estate
    included in allocation to minority interests in partially owned
    properties included in Discontinued Operations |                                        |        | (29,699 | )      
|                                                                 | Our share of gains on sales of real estate classified as income
    from unconsolidated joint ventures included in Income from
    Continuing Operations                          |                                        |        | 17,376  |        
|                                                                 |                                                                                                                                                                                   |                                        |       
|                                                                 | Our share of the gains on sales of real estate                                                                                                                                    |                                        |        | 79,648  |        
|                                                                 |                                                                                                                                                                                   |                                        |       
|                                                                 |                                                                                                                                                                                   | For the six months ended June 30, 2005 |        | $       | 103,893 | 
|                                                                 |                                                                                                                                                                                   |                                        |       



| |                     
| | --------------------
| | Sales of Real Estate



|                                 |                                                                                                                                                     |          |                                  |                           |      |    |           |                        |  |             |                            |   |  |             |             |         |             |           |         |             |  |         |         |         |  |  |         |        | 
|-------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | -------------------------------- | ------------------------- | ---- | -- | --------- | ---------------------- |  | ----------- | -------------------------- | - |  | ----------- | ----------- | ------- | ----------- | --------- | ------- | ----------- |  | ------- | ------- | ------- |  |  | ------- | ------ | 
|                                 |                                                                                                                                                     |          |                                  |                           |      |    |           | Total Office Portfolio |  |             | Effective Office Portfolio |  
|                                 |                                                                                                                                                     |          |                                  | Disposition               |      |    | Number of |                        |  |             |                            |   |  |            
|Property                         |                                                                                                                                                     | Location |                                  |                           | Date |    |           | Buildings              |  |             | Square Feet                |   |  | Sales Price |             |         | Square Feet |           |         | Sales Price | 
|                                 |                                                                                                                                                     |          |                                  |                           |      |    |           |                        |  |             |                            |   |  |             |             |         |             |           |         |             | 
|                                 |                                                                                                                                                     |          |                                  |                           |      |    |           |                        |  | (Dollars in |                            |   |  |             | (Dollars in |        
|                                 |                                                                                                                                                     |          |                                  |                           |      |    |           |                        |  | thousands)  |                            |   |  |             | thousands)  |        
|First Quarter 2005 Dispositions: |                                                                                                                                                     |          |                                  |                           |      |    |           |                        |  |             |                            |   |  |             |             |         |             |           |         |             |  |         |         |         |  |  |         |       
|                                 | Northland Plaza(a)                                                                                                                                  |          |                                  | Bloomington, MN           |      |    |           | 1/04/2005              |  |             |                            | 1 |  |             |             | 296,967 |             |           | $       | 43,000      |  |         |         | 296,967 |  |  | $       | 43,000 | 
|                                 | Meier Central North 
    Buildings 13 and 14(b)                                                                                                    |          |                                  | Santa Clara, CA           |      |    |           | 1/20/2005              |  |             |                            |  |  |             |             |        |             |           |         | 1,986       |  |         |         |        |  |  |         | 1,986  | 
|                                 | Waters Edge(c)                                                                                                                                     |          |                                  | Playa Vista, CA           |      |    |           | 2/01/2005              |  |             |                            | 2 |  |             |             | 243,433 |             |           |         | 97,714      |  |         |         | 213,004 |  |  |         | 85,500 | 
|                                 | One Devon Square, Two Devon Square and Three Devon Square                                                                                           |          |                                  | Wayne, PA                 |      |    |           | 2/11/2005              |  |             |                            | 3 |  |             |             | 142,493 |             |           |         | 23,000      |  |         |         | 142,493 |  |  |         | 23,000 | 
|                                 | Meier Central South 
    Building 12(b)                                                                                                            |          |                                  | Santa Clara, CA           |      |    |           | 2/22/2005              |  |             |                            |  |  |             |             |        |             |           |         | 2,867       |  |         |         |        |  |  |         | 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(d) |          |                                  | Suburban Philadelphia, PA |      |    | 3/02/2005 |                        |  |             | 8                          |   |  |             | 863,124     |         |             |           | 136,000 |             |  |         | 863,124 |         |  |  | 136,000 |       
|                                 | Oak Creek I(b)                                                                                                                                      |          |                                  | Milpitas, CA              |      |    |           | 3/15/2005              |  |             |                            |  |  |             |             |        |             |           |         | 2,850       |  |         |         |        |  |  |         | 2,850  | 
|                                 | Meier Central North  Building 15(b)                                                                                                                |          |                                  | Santa Clara, CA           |      |    |           | 3/24/2005              |  |             |                            |  |  |             |             |        |             |           |         | 2,350       |  |         |         |        |  |  |         | 2,350  | 
|                                 |                                                                                                                                                     |          |                                  |                           |      |    |           |                        |  |             |                            |   |  |             |             |         |             |           |         |             | 
|                                 |                                                                                                                                                     |          | Total First Quarter Dispositions |                           |      | 14 |           |                        |  | 1,546,017   |                            |   |  | 309,767     |             |         |             | 1,515,588 |         |             |  | 297,553 |        
|                                 |                                                                                                                                                     |          |                                  |                           |      |    |           |                        |  |             |                            |   |  |             |             |         |            

12



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)


|                                  |                                                                      |          |                                   |                       |      |    |           |                        |  |             |                            |    |   |             |             |           |             |           |  |             |   |           |  |           |  |  |  |         | 
|--------------------------------- | -------------------------------------------------------------------- | -------- | --------------------------------- | --------------------- | ---- | -- | --------- | ---------------------- |  | ----------- | -------------------------- | -- | - | ----------- | ----------- | --------- | ----------- | --------- |  | ----------- | - | --------- |  | --------- |  |  |  | ------- | 
|                                  |                                                                      |          |                                   |                       |      |    |           | Total Office Portfolio |  |             | Effective Office Portfolio |   
|                                  |                                                                      |          |                                   | Disposition           |      |    | Number of |                        |  |             |                            |    |   |            
|Property                          |                                                                      | Location |                                   |                       | Date |    |           | Buildings              |  |             | Square Feet                |    |   | Sales Price |             |           | Square Feet |           |  | Sales Price |  
|                                  |                                                                      |          |                                   |                       |      |    |           |                        |  |             |                            |    |   |             |             |           |             |           |  |             |  
|                                  |                                                                      |          |                                   |                       |      |    |           |                        |  | (Dollars in |                            |    |   |             | (Dollars in |          
|                                  |                                                                      |          |                                   |                       |      |    |           |                        |  | thousands)  |                            |    |   |             | thousands)  |          
|Second Quarter 2005 Dispositions: |                                                                      |          |                                   |                       |      |    |           |                        |  |             |                            |    |   |             |             |           |             |           |  |             |   |           |  |           |  |  |  |        
|                                  | 545 E. John Carpenter Freeway and 909 Lake Carolyn
    Parkway       |          |                                   | Irving, TX            |      |    |           | 4/01/2005              |  |             |                            | 2  |   |             |             | 729,949   |             |           |  | 68,500      |   |           |  | 729,949   |  |  |  | 68,500  | 
|                                  | 70-76 Perimeter Center                                               |          |                                   | Atlanta, GA           |      |    |           | 4/05/2005              |  |             |                            | 4  |   |             |             | 62,102    |             |           |  | 11,055      |   |           |  | 62,102    |  |  |  | 11,055  | 
|                                  | Meier Central South  Building 11                                    |          |                                   | Santa Clara, CA       |      |    |           | 4/18/2005              |  |             |                            | 1  |   |             |             | 33,672    |             |           |  | 4,400       |   |           |  | 33,672    |  |  |  | 4,400   | 
|                                  | Colonnade I, II & III                                                |          |                                   | Dallas, TX            |      |    |           | 4/26/2005              |  |             |                            | 3  |   |             |             | 984,254   |             |           |  | 153,500     |   |           |  | 984,254   |  |  |  | 153,500 | 
|                                  | LL&E Tower                                                           |          |                                   | New Orleans, LA       |      |    |           | 5/04/2005              |  |             |                            | 1  |   |             |             | 545,157   |             |           |  | 45,000      |   |           |  | 545,157   |  |  |  | 45,000  | 
|                                  | Preston Commons and Sterling Plaza(e)                                |          |                                   | Dallas, TX            |      |    |           | 5/20/2005              |  |             |                            | 4  |   |             |             | 721,351   |             |           |  | 138,381     |   |           |  | 360,676   |  |  |  | 69,190  | 
|                                  | Oak Creek II(b)                                                      |          |                                   | Milpitas, CA          |      |    |           | 5/25/2005              |  |             |                            |   |   |             |             |          |             |           |  | 3,575       |   |           |  |          |  |  |  | 3,575   | 
|                                  | Concar                                                               |          |                                   | San Mateo, CA         |      |    |           | 5/26/2005              |  |             |                            | 2  |   |             |             | 218,985   |             |           |  | 111,555     |   |           |  | 175,100   |  |  |  | 78,156  | 
|                                  | The Solarium                                                         |          |                                   | Greenwood Village, CO |      |    |           | 5/27/2005              |  |             |                            | 1  |   |             |             | 162,817   |             |           |  | 15,800      |   |           |  | 162,817   |  |  |  | 15,800  | 
|                                  | Point West I  Response Road and Point
    West III  River Park Dr. |          |                                   | Sacramento, CA        |      |    |           | 6/13/2005              |  |             |                            | 2  |   |             |             | 118,973   |             |           |  | 16,200      |   |           |  | 118,973   |  |  |  | 16,200  | 
|                                  | Sierra Point                                                         |          |                                   | Brisbane, CA          |      |    |           | 6/15/2005              |  |             |                            | 1  |   |             |             | 99,150    |             |           |  | 15,000      |   |           |  | 99,150    |  |  |  | 15,000  | 
|                                  | BP Tower and garage                                                  |          |                                   | Cleveland, OH         |      |    |           | 6/24/2005              |  |             |                            | 1  |   |             |             | 1,277,488 |             |           |  | 141,250     |   |           |  | 1,277,488 |  |  |  | 141,250 | 
|                                  | 301 Howard Street (includes 195 Beale land)                          |          |                                   | San Francisco, CA     |      |    |           | 6/24/2005              |  |             |                            | 1  |   |             |             | 307,396   |             |           |  | 70,000      |   |           |  | 307,396   |  |  |  | 70,000  | 
|                                  | Foundry Square II                                                    |          |                                   | San Francisco, CA     |      |    |           | 6/24/2005              |  |             |                            | 1  |   |             |             | 502,424   |             |           |  | 133,000     |   |           |  | 502,424   |  |  |  | 133,000 | 
|                                  | Parkside Towers                                                      |          |                                   | Foster City, CA       |      |    |           | 6/24/2005              |  |             |                            | 2  |   |             |             | 398,460   |             |           |  | 73,000      |   |           |  | 398,460   |  |  |  | 73,000  | 
|                                  | San Rafael Corporate Center                                          |          |                                   | San Rafael, CA        |      |    |           | 6/24/2005              |  |             |                            | 2  |   |             |             | 155,318   |             |           |  | 43,000      |   |           |  | 155,318   |  |  |  | 43,000  | 
|                                  | San Rafael Land                                                      |          |                                   | San Rafael, CA        |      |    |           | 6/24/2005              |  |             |                            |   |   |             |             |          |             |           |  | 10,000      |   |           |  |          |  |  |  | 10,000  | 
|                                  | Shoreline Technology Park                                            |          |                                   | Mountain View, CA     |      |    |           | 6/28/2005              |  |             |                            | 12 |   |             |             | 726,508   |             |           |  | 199,500     |   |           |  | 726,508   |  |  |  | 199,500 | 
|                                  | Seaport Centre                                                       |          |                                   | Redwood City, CA      |      |    |           | 6/28/2005              |  |             |                            | 13 |   |             |             | 465,955   |             |           |  | 74,000      |   |           |  | 465,955   |  |  |  | 74,000  | 
|                                  | Seaport Plaza                                                        |          |                                   | Redwood City, CA      |      |    |           | 6/28/2005              |  |             |                            | 2  |   |             |             | 159,350   |             |           |  | 32,000      |   |           |  | 159,350   |  |  |  | 32,000  | 
|                                  | 1871 The Alameda                                                     |          |                                   | San Jose, CA          |      |    |           | 6/28/2005              |  |             |                            | 1  |   |             |             | 44,287    |             |           |  | 9,250       |   |           |  | 44,287    |  |  |  | 9,250   | 
|                                  | 5813 Shellmound/5855 Christie                                        |          |                                   | Emeryville, CA        |      |    |           | 6/28/2005              |  |             |                            | 2  |   |             |             | 56,898    |             |           |  | 7,100       |   |           |  | 56,898    |  |  |  | 7,100   | 
|                                  | Baybridge Office Plaza                                               |          |                                   | Emeryville, CA        |      |    |           | 6/28/2005              |  |             |                            | 1  |   |             |             | 79,358    |             |           |  | 5,900       |   |           |  | 79,358    |  |  |  | 5,900   | 
|                                  |                                                                      |          |                                   |                       |      |    |           |                        |  |             |                            |    |   |             |             |           |             |           |  |             |  
|                                  |                                                                      |          | Total Second Quarter Dispositions |                       |      | 59 |           |                        |  | 7,849,852   |                            |    |   | 1,380,966   |             |           |             | 7,445,292 |  |             |   | 1,278,376 | 
|                                  |                                                                      |          |                                   |                       |      |    |           |                        |  |             |                            |    |   |             |             |           |            
|                                  |                                                                      |          | Total                             |                       |      | 73 |           |                        |  | 9,395,869   |                            |    | $ | 1,690,733   |             |           |             | 8,960,880 |  |             | $ | 1,575,929 | 
|                                  |                                                                      |          |                                   |                       |      |    |           |                        |  |             |                            |    |   |             |             |           |            






|    |  |                                                                                                                                                                                                                               
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(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.                        
|   
|(b) |  | These properties, which consists of six office buildings
    comprising approximately 149,131 square feet, were
    previously taken out of service and were no longer included in
    building and square footage statistics.
|   
|(c) |  | We disposed of our 87.5% interest in this property.                                                                                                                                                                           
|   
|(d) |  | In connection with the sale of the Walnut Hill Plaza office
    property, we repaid approximately $13.4 million of mortgage
    debt that encumbered the property.                                                            

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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




|    |  |                                                                                                                                                    
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------
|(e) |  | We disposed of our 50% ownership interest in these properties.
    We accounted for our 50% interest in the properties under the
    equity method.



| |                         
| | ------------------------
| | Properties Held for Sale



|                                      |       |          |                   |             |      |  |           |                        |  |  |                            |   |  |             |         |         |             |   |         |             |  |  |         |           |  |   |         |         | 
|------------------------------------- | ----- | -------- | ----------------- | ----------- | ---- |  | --------- | ---------------------- |  |  | -------------------------- | - |  | ----------- | ------- | ------- | ----------- | - | ------- | ----------- |  |  | ------- | --------- |  | - | ------- | ------- | 
|                                      |       |          |                   |             |      |  |           | Total Office Portfolio |  |  | Effective Office Portfolio |  
|                                      |       |          |                   | Disposition |      |  | Number of |                        |  |  |                            |   |  |            
|Property                              |       | Location |                   |             | Date |  |           | Buildings              |  |  | Square Feet                |   |  | Sales Price |         |         | Square Feet |   |         | Sales Price | 
|                                      |       |          |                   |             |      |  |           |                        |  |  |                            |   |  |             |         |         |             |   |         |             | 
|                                      |       |          |                   |             |      |  |           | (Dollars in thousands) | 
|201 Mission Street/ 580 California(f) |       |          | San Francisco, CA |             |      |  | 7/06/2005 |                        |  |  |                           |   |  |             |        |         |             | $ | 217,000 |             |  |  | 597,226 |           |  | $ | 162,750 |        
|The Orchard                           |       |          | Sacramento, CA    |             |      |  | 7/14/2005 |                        |  |  | 1                          |   |  |             | 65,392  |         |             |   | 10,700  |             |  |  | 65,392  |           |  |   | 10,700  |        
|Texaco Center/601 Garage              |       |          | New Orleans, LA   |             |      |  | 7/25/2005 |                        |  |  | 1                          |   |  |             | 629,428 |         |             |   | 49,000  |             |  |  | 629,428 |           |  |   | 49,000  |        
|                                      |       |          |                   |             |      |  |           |                        |  |  |                            |   |  |             |         |         |             |   |         |             | 
|                                      | Total |          |                   |             |      |  |           |                        |  |  |                            | 2 |  |             |         | 694,820 |             |   | $       | 276,700     |  |  |         | 1,292,046 |  |   | $       | 222,450 | 
|                                      |       |          |                   |             |      |  |           |                        |  |  |                            |   |  |             |         |         |             |   |         |             | 






|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(f) |  | At June 30, 2005, 75% of our interest in these two office
    properties comprising 796,301 square feet was deemed held
    for sale. Following disposition, we retained a 25% ownership
    interest in these properties. These two buildings will remain in
    our building count for the Total Office Portfolio and the
    Effective Office Portfolio. The total square feet of these
    buildings will remain in our Total Office Portfolio statistics;
    however, the square feet included in the Effective Office
    Portfolio will be reduced to reflect our 25% ownership interest.

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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




|                                                                                                                                                                       |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |        |        |        |         |        |        |        | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------- | ---------------------------- | ---------------- | ------ | ---------------- | ----- | ------ | ------ | ------ | ------ | -------- | ------ | ------ | ------ | ------- | ------ | ------ | ------ | 
|                                                                                                                                                                       |                                                                                           | For the                      |                  |        | For the          |      
|                                                                                                                                                                       |                                                                                           | three months ended           |                  |        | six months ended |      
|                                                                                                                                                                       |                                                                                           | June 30,                     |                  |        | June 30,         |      
|                                                                                                                                                                       |                                                                                           |                              |                  |        |                  |      
|(Dollars in thousands)                                                                                                                                                 |                                                                                           | 2005                         |                  |        | 2004             |       |        | 2005   |        |        | 2004     |       
|                                                                                                                                                                       |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |       
|Property operating revenues                                                                                                                                            |                                                                                           | $                            | 28,097           |        |                  | $     | 56,056 |        |        | $      | 71,023   |        |        | $      | 114,385 |       
|                                                                                                                                                                       |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |       
|Expenses:                                                                                                                                                              |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |        |        |        |         |       
|                                                                                                                                                                       | Depreciation and amortization                                                             |                              |                  | 8,610  |                  |       |        | 16,632 |        |        |          | 22,072 |        |        |         | 33,400 |       
|                                                                                                                                                                       | Property operating                                                                        |                              |                  | 11,411 |                  |       |        | 20,448 |        |        |          | 27,664 |        |        |         | 41,524 |       
|                                                                                                                                                                       | Ground rent                                                                               |                              |                  | 960    |                  |       |        | 1,081  |        |        |          | 2,040  |        |        |         | 1,975  |       
|                                                                                                                                                                       |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |       
|                                                                                                                                                                       |                                                                                           | Total expenses               |                  |        | 20,981           |       |        |        | 38,161 |        |          |        | 51,776 |        |         |        | 76,899 |       
|                                                                                                                                                                       |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |       
|                                                                                                                                                                       |                                                                                           |                              | Operating income |        |                  | 7,116 |        |        |        | 17,895 |          |        |        | 19,247 |         |        |        | 37,486 | 
|                                                                                                                                                                       |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |       
|Other income (expense):                                                                                                                                                |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |        |        |        |         |       
|                                                                                                                                                                       | Interest and dividend income                                                              |                              |                  | 18     |                  |       |        | 5      |        |        |          | 34     |        |        |         | 12     |       
|                                                                                                                                                                       | Interest expense and amortization of deferred financing costs
    and prepayment expenses |                              |                  | (2     | )                |       |        | (767   | )      |        |          | (611   | )      |        |         | (2,204 | )     
|                                                                                                                                                                       |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |       
|                                                                                                                                                                       |                                                                                           | Total other income (expense) |                  |        | 16               |       |        |        | (762   | )      |          |        | (577   | )      |         |        | (2,192 | )     
|                                                                                                                                                                       |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |       
|Income before income taxes, allocations to minority interests,
    gain and (loss) on sales of real estate and provision for (loss)
    on properties held for sale    |                                                                                           |                              | 7,132            |        |                  |       | 17,133 |        |        |        | 18,670   |        |        |        | 35,294  |       
|Income taxes                                                                                                                                                           |                                                                                           |                              | (23              | )      |                  |       | (33    | )      |        |        | (54      | )      |        |        | (28     | )     
|Income allocated to minority interests  partially
    owned properties (including gains on sales of real estate of
    $29,699, $214, $29,699 and $214, respectively) |                                                                                           |                              | (29,983          | )      |                  |       | (268   | )      |        |        | (30,440  | )      |        |        | (595    | )     
|Gain on sales of real estate                                                                                                                                           |                                                                                           |                              | 91,971           |        |                  |       | 9,533  |        |        |        | 116,216  |        |        |        | 11,839  |       
|(Loss) on sales of real estate                                                                                                                                         |                                                                                           |                              | (165,927         | )      |                  |       | (7,606 | )      |        |        | (179,465 | )      |        |        | (7,717  | )     
|Provision for (loss) on properties held for sale                                                                                                                       |                                                                                           |                              | (20,264          | )      |                  |       |       |        |        |        | (20,264  | )      |        |        |        |       
|                                                                                                                                                                       |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |       
|Net (loss) income                                                                                                                                                      |                                                                                           | $                            | (117,094         | )      |                  | $     | 18,759 |        |        | $      | (95,337  | )      |        | $      | 38,793  |       
|                                                                                                                                                                       |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |       
|Property net operating income from discontinued operations                                                                                                             |                                                                                           | $                            | 16,686           |        |                  | $     | 35,608 |        |        | $      | 43,359   |        |        | $      | 72,861  |       
|                                                                                                                                                                       |                                                                                           |                              |                  |        |                  |       |        |        |        |        |          |       

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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




|         |                                             
|-------- | --------------------------------------------
|NOTE 5  | INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES



|                                                                                                                                                                  |                                                         |                                                              |           |           |              |   |           |           |           | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------- | ------------------------------------------------------------ | --------- | --------- | ------------ | - | --------- | --------- | --------- | 
|                                                                                                                                                                  |                                                         | June 30,                                                     |           |           | December 31, |  
|(Dollars in thousands)                                                                                                                                            |                                                         | 2005                                                         |           |           | 2004         |  
|                                                                                                                                                                  |                                                         |                                                              |           |           |              |  
|Balance Sheets:                                                                                                                                                   |                                                         |                                                              |           |           |              |   |           |          
|                                                                                                                                                                  | Assets:                                                 |                                                              |           |           |              |   |           |           |          
|                                                                                                                                                                  | Real estate, net of accumulated depreciation            |                                                              | $         | 2,975,954 |              |   | $         | 3,068,975 |          
|                                                                                                                                                                  | Other assets                                            |                                                              |           | 319,909   |              |   |           | 343,075   |          
|                                                                                                                                                                  |                                                         |                                                              |           |           |              |  
|                                                                                                                                                                  |                                                         | Total Assets                                                 |           | $         | 3,295,863    |   |           | $         | 3,412,050 | 
|                                                                                                                                                                  |                                                         |                                                              |           |           |              |  
|                                                                                                                                                                  | Liabilities and Partners and Shareholders
    Equity: |                                                              |           |           |              |   |           |           |          
|                                                                                                                                                                  | Mortgage debt                                           |                                                              | $         | 929,426   |              |   | $         | 931,976   |          
|                                                                                                                                                                  | Other liabilities                                       |                                                              |           | 131,031   |              |   |           | 138,010   |          
|                                                                                                                                                                  | Partners and shareholders equity                      |                                                              |           | 2,235,406 |              |   |           | 2,342,064 |          
|                                                                                                                                                                  |                                                         |                                                              |           |           |              |  
|                                                                                                                                                                  |                                                         | Total Liabilities and Partners and Shareholders
    Equity |           | $         | 3,295,863    |   |           | $         | 3,412,050 | 
|                                                                                                                                                                  |                                                         |                                                              |           |           |              |  
|Our share of historical partners and shareholders
    equity                                                                                                    |                                                         | $                                                            | 987,150   |           |              | $ | 1,032,664 |          
|Net excess of cost of investments over the net book value of
    underlying net assets (net of accumulated depreciation of
    $22,617 and $22,797, respectively) |                                                         |                                                              | 81,819    |           |              |   | 84,479    |          
|                                                                                                                                                                  |                                                         |                                                              |           |           |              |  
|Carrying value of investments in unconsolidated joint ventures                                                                                                    |                                                         | $                                                            | 1,068,969 |           |              | $ | 1,117,143 |          
|                                                                                                                                                                  |                                                         |                                                              |           |           |              |  
|Our share of unconsolidated non-recourse mortgage debt                                                                                                            |                                                         | $                                                            | 359,732   |           |              | $ | 361,032   |          
|                                                                                                                                                                  |                                                         |                                                              |           |           |              |  

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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)


|                          |                                                     |                                                                             |                |         |                  |         |   |         |        |        |      |         |         |         |   |         |        |         | 
|------------------------- | --------------------------------------------------- | --------------------------------------------------------------------------- | -------------- | ------- | ---------------- | ------- | - | ------- | ------ | ------ | ---- | ------- | ------- | ------- | - | ------- | ------ | ------- | 
|                          |                                                     | For the                                                                     |                |         | For the          |        
|                          |                                                     | three months ended                                                          |                |         | six months ended |        
|                          |                                                     | June 30,                                                                    |                |         | June 30,         |        
|                          |                                                     |                                                                             |                |         |                  |        
|(Dollars in thousands)    |                                                     | 2005                                                                        |                |         | 2004             |         |   | 2005    |        |        | 2004 |        
|                          |                                                     |                                                                             |                |         |                  |         |   |         |        |        |      |        
|Statements of Operations: |                                                     |                                                                             |                |         |                  |         |   |         |        |        |      |         |         |         |   |        
|                          | Revenues                                            |                                                                             | $              | 132,430 |                  |         | $ | 104,961 |        |        | $    | 256,750 |         |         | $ | 222,001 |       
|                          |                                                     |                                                                             |                |         |                  |         |   |         |        |        |      |        
|                          | Expenses:                                           |                                                                             |                |         |                  |         |   |         |        |        |      |         |         |         |   |         |       
|                          |                                                     | Interest expense and loan cost amortization                                 |                |         | 13,146           |         |   |         | 8,842  |        |      |         | 25,645  |         |   |         | 22,189 |        
|                          |                                                     | Depreciation and amortization                                               |                |         | 32,637           |         |   |         | 24,574 |        |      |         | 62,898  |         |   |         | 53,076 |        
|                          |                                                     | Operating expenses, ground rent and general and administrative
    expenses |                |         | 59,904           |         |   |         | 42,855 |        |      |         | 119,117 |         |   |         | 90,445 |        
|                          |                                                     |                                                                             |                |         |                  |         |   |         |        |        |      |        
|                          |                                                     |                                                                             | Total expenses |         |                  | 105,687 |   |         |        | 76,271 |      |         |         | 207,660 |   |         |        | 165,710 | 
|                          |                                                     |                                                                             |                |         |                  |         |   |         |        |        |      |        
|                          | Net income before gain on sale of real estate       |                                                                             |                | 26,743  |                  |         |   | 28,690  |        |        |      | 49,090  |         |         |   | 56,291  |       
|                          | Gain on sale of real estate                         |                                                                             |                | 39,545  |                  |         |   |        |        |        |      | 39,545  |         |         |   |        |       
|                          |                                                     |                                                                             |                |         |                  |         |   |         |        |        |      |        
|                          | Net income                                          |                                                                             | $              | 66,288  |                  |         | $ | 28,690  |        |        | $    | 88,635  |         |         | $ | 56,291  |       
|                          |                                                     |                                                                             |                |         |                  |         |   |         |        |        |      |        
|Our share of:             |                                                     |                                                                             |                |         |                  |         |   |         |        |        |      |         |         |         |   |        
|                          | Net income                                          |                                                                             | $              | 28,681  |                  |         | $ | 12,554  |        |        | $    | 38,199  |         |         | $ | 24,967  |       
|                          |                                                     |                                                                             |                |         |                  |         |   |         |        |        |      |        
|                          | Interest expense and loan cost amortization         |                                                                             | $              | 5,008   |                  |         | $ | 4,192   |        |        | $    | 9,903   |         |         | $ | 12,294  |       
|                          |                                                     |                                                                             |                |         |                  |         |   |         |        |        |      |        
|                          | Depreciation and amortization (real estate related) |                                                                             | $              | 12,506  |                  |         | $ | 9,119   |        |        | $    | 24,768  |         |         | $ | 20,807  |       
|                          |                                                     |                                                                             |                |         |                  |         |   |         |        |        |      |        



|         |                  
|-------- | -----------------
|NOTE 6  | LEASE TERMINATION



17



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




|         |              
|-------- | -------------
|NOTE 7  | MORTGAGE DEBT



|                                |                                                         |                         |           |         |          |  
|------------------------------- | ------------------------------------------------------- | ----------------------- | --------- | ------- | -------- | -
|                                |                                                         | (Dollars in thousands)  |          
|                                |                                                         |                         |          
|Balance at December 31, 2004(a) |                                                         | $                       | 2,622,750 |        
|                                | Scheduled principal amortization prior to maturity      |                         |           | (9,963  | )       
|                                | Repayment of debt encumbering the following properties: |                         |           |         |         
|                                |                                                         | Sixty State Street      |           |         | (71,962  | )
|                                |                                                         | Island Corporate Center |           |         | (12,312  | )
|                                |                                                         | San Mateo BayCenter II  |           |         | (9,520   | )
|                                | Repaid upon sale of property (see Note 4)               |                         |           | (13,386 | )       
|                                |                                                         |                         |          
|Balance at March 31, 2005(a)    |                                                         |                         | 2,505,607 |        
|                                | Scheduled principal amortization prior to maturity      |                         |           | (9,361  | )       
|                                | Repayment of debt encumbering the following properties: |                         |           |         |         
|                                |                                                         | 1740 Technology         |           |         | (15,684  | )
|                                |                                                         | One Market              |           |         | (171,689 | )
|                                |                                                         | Central Park            |           |         | (55,030  | )
|                                | Assumed through property acquisitions (see Note 3)      |                         |           | 44,975  |         
|                                | Washington Mutual Tower refinancing(b)                  |                         |           | 150     |         
|                                |                                                         |                         |          
|Balance at June 30, 2005(a)     |                                                         | $                       | 2,298,968 |        
|                                |                                                         |                         |          






|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Excludes net discounts on mortgage debt.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   
|(b) |  | We refinanced the mortgage debt encumbering the Washington
    Mutual Tower office property. The new mortgage has a principal
    balance of approximately $79.25 million, bears interest at
    a fixed coupon rate of 4.55% and matures in June 2010. The prior
    mortgage had a principal balance of approximately
    $79.1 million, bore interest at a fixed coupon rate of
    7.53% and was scheduled to mature in November 2005. The
    effective interest rate on the new debt is 4.56% as compared to
    7.77% on the prior mortgage.



|         |                                       
|-------- | --------------------------------------
|NOTE 8  | UNSECURED NOTES AND TERM LOAN FACILITY





| |                          
| | -------------------------
| | Unsecured Notes  Issued:

|                   |  |                     |  |                        |        |   |             |  |               |                   |  |  |                  |  |  |  |             | 
|------------------ |  | ------------------- |  | ---------------------- | ------ | - | ----------- |  | ------------- | ----------------- |  |  | ---------------- |  |  |  | ----------- | 
|Original Term      |  | Month of Issuance   |  | Amount                 |        |   | Coupon Rate |  |               | Effective Rate(a) |  |  | Year of Maturity | 
|                   |  |                     |  |                        |        |   |             |  |               |                   |  |  |                  | 
|                   |  |                     |  | (Dollars in thousands) |        |   |             |  |               |                   | 
|2 Years to 4 Years |  | January             |  | $                      | 6,221  |   |             |  | 3.45% - 4.15% |                   |  |  | 3.76% - 4.39%    |  |  |  | 2007 - 2009 | 
|2 Years to 4 Years |  | February            |  |                        | 3,220  |   |             |  | 3.70% - 4.15% |                   |  |  | 4.01% - 4.39%    |  |  |  | 2007 - 2009 | 
|3 Years to 5 Years |  | March               |  |                        | 4,997  |   |             |  | 4.05% - 4.75% |                   |  |  | 4.33% - 5.00%    |  |  |  | 2008 - 2010 | 
|2 Years to 4 Years |  | April               |  |                        | 7,672  |   |             |  | 4.30% - 4.80% |                   |  |  | 4.61% - 5.04%    |  |  |  | 2007 - 2009 | 
|2 Years to 6 Years |  | June                |  |                        | 6,426  |   |             |  | 4.10% - 4.63% |                   |  |  | 4.41% - 4.87%    |  |  |  | 2007 - 2011 | 
|                   |  | Less issuance costs |  |                        | (167   | ) |             |  |               |                   |  |  |                  |  |  |  |             | 
|                   |  |                     |  |                        |        |   |             |  |               |                   |  |  |                  | 
|                   |  | Net Proceeds        |  | $                      | 28,369 |   |             |  |               |                   |  |  |                  |  |  |  |             | 
|                   |  |                     |  |                        |        |   |             |  |               |                   |  |  |                  | 

18



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




| |                          
| | -------------------------
| | Unsecured Notes  Repaid:

|             |       |                        |         |         |             |  |      |                   |  |  |      |   | 
|------------ | ----- | ---------------------- | ------- | ------- | ----------- |  | ---- | ----------------- |  |  | ---- | - | 
|Month Repaid |       | Amount                 |         |         | Coupon Rate |  |      | Effective Rate(a) | 
|             |       |                        |         |         |             |  |      |                   | 
|             |       | (Dollars in thousands) |         |         |             |  |     
|February     |       | $                      | 125,000 |         |             |  | 6.88 | %                 |  |  | 6.40 | %
|February     |       |                        | 400,000 |         |             |  | 6.63 | %                 |  |  | 4.99 | %
|             |       |                        |         |         |             |  |      |                   | 
|             | Total |                        | $       | 525,000 |             |  |      |                   |  |  |      |   | 
|             |       |                        |         |         |             |  |      |                   | 






|    |  |                                                                                                                                                              
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Includes the effect of settled interest rate protection and
    interest rate swap agreements, offering and transaction costs
    and premiums and discounts.



| |                   
| | ------------------
| | Term Loan Facility





|         |                                                                 
|-------- | ----------------------------------------------------------------
|NOTE 9  | PARTNERS CAPITAL AND MANDATORILY REDEEMABLE PREFERRED
    UNITS



| |      
| | -----
| | Units



|                                 |                                                                                       |  |             |            |  
|-------------------------------- | ------------------------------------------------------------------------------------- |  | ----------- | ---------- | -
|Outstanding at December 31, 2004 |                                                                                       |  | 451,337,142 |           
|                                 | Repurchased and retired(a)                                                            |  |             | (86,505    | )
|                                 | Repurchased in 2004, but retired in 2005                                              |  |             | (25,728    | )
|                                 | Issued to Equity Office upon exercise of share options                                |  |             | 1,618,882  |  
|                                 | Issued to Equity Office related to restricted shares issued, net
    of cancellations |  |             | 819,515    |  
|                                 | Units redeemed for cash                                                               |  |             | (203,396   | )
|                                 | Issued to Equity Office upon conversion of 70 Series B
    Preferred Units            |  |             | 98         |  
|                                 |                                                                                       |  |            
|Outstanding at March 31, 2005    |                                                                                       |  | 453,460,008 |           
|                                 | Repurchased and retired (at an average purchase price of
    $31.63 per unit)         |  |             | (158,771   | )
|                                 | Repurchased in the first quarter 2005, but retired in the second
    quarter 2005     |  |             | (4,000     | )
|                                 | Issued to Equity Office upon exercise of share options                                |  |             | 2,904,887  |  
|                                 | Restricted share cancellations, net of restricted shares issued
    to Equity Office  |  |             | (37,948    | )
|                                 | Units redeemed for cash                                                               |  |             | (1,453,702 | )
|                                 | Units issued as compensation for Equity Offices Board of
    Trustees fees           |  |             | 4,687      |  
|                                 | Units issued in connection with a property acquisition (see
    Note 3)               |  |             | 108,190    |  
|                                 |                                                                                       |  |            
|Outstanding at June 30, 2005     |                                                                                       |  | 454,823,351 |           
|                                 |                                                                                       |  |            






|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | During the three months ended March 31, 2005, 90,505 Equity
    Office common shares of beneficial interest (Common
    Shares) were repurchased at an average purchase price of
    $30.15 for approximately $2.7 million. Of these 90,505
    Common Shares, 4,000 were not yet retired as of March 31,
    2005. In connection with these repurchases, we retired a
    corresponding number of Units for an aggregate purchase price
    equal to the aggregate purchase price for all Common Share
    repurchases.

19



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




| |              
| | -------------
| | Distributions



|                         |  |              |          |  |           |               |             |              
|------------------------ |  | ------------ | -------- |  | --------- | ------------- | ----------- | -------------
|                         |  | Distribution |          |  |           |               | Unitholder 
|                         |  | Per Unit     |          |  | Date Paid |               | Record Date
|                         |  |              |          |  |           |               |            
|Units                    |  | $            | 0.50     |  |           | July 15, 2005 |             | June 30, 2005
|Series B Preferred Units |  | $            | 0.65625  |  |           | May 16, 2005  |             | May 2, 2005  
|Series G Preferred Units |  | $            | 0.484375 |  |           | June 15, 2005 |             | June 1, 2005 



|          |                         
|--------- | ------------------------
|NOTE 10  | (LOSS) EARNINGS PER UNIT



|                                                |                                                                                                                                                                                                 |                                                                                          |   |             |                          |  |   |             |           |  |      |             |   |  |   |             |           | 
|----------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------- | - | ----------- | ------------------------ |  | - | ----------- | --------- |  | ---- | ----------- | - |  | - | ----------- | --------- | 
|                                                |                                                                                                                                                                                                 | For the three months ended                                                               |   |             | For the six months ended | 
|                                                |                                                                                                                                                                                                 | June 30,                                                                                 |   |             | June 30,                 | 
|                                                |                                                                                                                                                                                                 |                                                                                          |   |             |                          | 
|(Dollars in thousands, except per unit amounts) |                                                                                                                                                                                                 | 2005                                                                                     |   |             | 2004                     |  |   | 2005        |           |  | 2004 |            
|                                                |                                                                                                                                                                                                 |                                                                                          |   |             |                          |  |   |             |           |  |      |            
|Numerator:                                      |                                                                                                                                                                                                 |                                                                                          |   |             |                          |  |   |             |           |  |      |             |   |  |   |            
|                                                | (Loss) income from continuing operations                                                                                                                                                        |                                                                                          | $ | (103,324    | )                        |  | $ | 102,859     |           |  | $    | (3,756      | ) |  | $ | 202,510     |          
|                                                | Preferred distributions                                                                                                                                                                         |                                                                                          |   | (8,701      | )                        |  |   | (8,944      | )         |  |      | (17,402     | ) |  |   | (21,692     | )        
|                                                |                                                                                                                                                                                                 |                                                                                          |   |             |                          |  |   |             |           |  |      |            
|                                                | (Loss) income from continuing operations available to unitholders                                                                                                                               |                                                                                          |   | (112,025    | )                        |  |   | 93,915      |           |  |      | (21,158     | ) |  |   | 180,818     |          
|                                                | Discontinued operations (including net (loss) gain on sales of
    real estate and provision for loss on properties held for sale
    of $(94,220), $1,927, $(83,513) and $4,122, respectively) |                                                                                          |   | (117,094    | )                        |  |   | 18,759      |           |  |      | (95,337     | ) |  |   | 38,793      |          
|                                                | Cumulative effect of a change in accounting principle                                                                                                                                           |                                                                                          |   |            |                          |  |   |            |           |  |      |            |   |  |   | (33,697     | )        
|                                                |                                                                                                                                                                                                 |                                                                                          |   |             |                          |  |   |             |           |  |      |            
|                                                | Numerator for basic and diluted (loss) earnings per
    unit  net (loss) income available to unitholders                                                                                       |                                                                                          | $ | (229,119    | )                        |  | $ | 112,674     |           |  | $    | (116,495    | ) |  | $ | 185,914     |          
|                                                |                                                                                                                                                                                                 |                                                                                          |   |             |                          |  |   |             |           |  |      |            
|Denominator:                                    |                                                                                                                                                                                                 |                                                                                          |   |             |                          |  |   |             |           |  |      |             |   |  |   |            
|                                                | Denominator for basic (loss) earnings per unit 
    weighted average Units outstanding                                                                                                         |                                                                                          |   | 451,728,242 |                          |  |   | 449,245,505 |           |  |      | 450,881,385 |   |  |   | 448,902,096 |          
|                                                | Effect of dilutive potential units:                                                                                                                                                             |                                                                                          |   |             |                          |  |   |             |           |  |      |             |   |  |   |             |          
|                                                |                                                                                                                                                                                                 | Units issuable upon exercise of Equity Office share options and
    restricted shares(a) |   |             |                         |  |   |             | 1,288,336 |  |      |             |  |  |   |             | 1,938,268 | 
|                                                |                                                                                                                                                                                                 |                                                                                          |   |             |                          |  |   |             |           |  |      |            
|                                                | Denominator for diluted (loss) earnings per unit 
    weighted average Units outstanding and dilutive potential units                                                                          |                                                                                          |   | 451,728,242 |                          |  |   | 450,533,841 |           |  |      | 450,881,385 |   |  |   | 450,840,364 |          
|                                                |                                                                                                                                                                                                 |                                                                                          |   |             |                          |  |   |             |           |  |      |            

20



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)


|                                                |                                                                   |                            |   |       |                          |  |   |      |  |  |      |       |   |  |   |       |  
|----------------------------------------------- | ----------------------------------------------------------------- | -------------------------- | - | ----- | ------------------------ |  | - | ---- |  |  | ---- | ----- | - |  | - | ----- | -
|                                                |                                                                   | For the three months ended |   |       | For the six months ended | 
|                                                |                                                                   | June 30,                   |   |       | June 30,                 | 
|                                                |                                                                   |                            |   |       |                          | 
|(Dollars in thousands, except per unit amounts) |                                                                   | 2005                       |   |       | 2004                     |  |   | 2005 |  |  | 2004 |      
|                                                |                                                                   |                            |   |       |                          |  |   |      |  |  |      |      
|(Loss) earnings per unit  basic:               |                                                                   |                            |   |       |                          |  |   |      |  |  |      |       |   |  |   |      
|                                                | (Loss) income from continuing operations available to unitholders |                            | $ | (0.25 | )                        |  | $ | 0.21 |  |  | $    | (0.05 | ) |  | $ | 0.40  |  
|                                                | Discontinued operations                                           |                            |   | (0.26 | )                        |  |   | 0.04 |  |  |      | (0.21 | ) |  |   | 0.09  |  
|                                                | Cumulative effect of a change in accounting principle             |                            |   |      |                          |  |   |     |  |  |      |      |   |  |   | (0.08 | )
|                                                |                                                                   |                            |   |       |                          |  |   |      |  |  |      |      
|                                                | Net (loss) income available to unitholders(b)                     |                            | $ | (0.51 | )                        |  | $ | 0.25 |  |  | $    | (0.26 | ) |  | $ | 0.41  |  
|                                                |                                                                   |                            |   |       |                          |  |   |      |  |  |      |      
|(Loss) earnings per unit  diluted:             |                                                                   |                            |   |       |                          |  |   |      |  |  |      |       |   |  |   |      
|                                                | (Loss) income from continuing operations available to unitholders |                            | $ | (0.25 | )                        |  | $ | 0.21 |  |  | $    | (0.05 | ) |  | $ | 0.40  |  
|                                                | Discontinued operations                                           |                            |   | (0.26 | )                        |  |   | 0.04 |  |  |      | (0.21 | ) |  |   | 0.09  |  
|                                                | Cumulative effect of a change in accounting principle             |                            |   |      |                          |  |   |     |  |  |      |      |   |  |   | (0.07 | )
|                                                |                                                                   |                            |   |       |                          |  |   |      |  |  |      |      
|                                                | Net (loss) income available to unitholders(b)                     |                            | $ | (0.51 | )                        |  | $ | 0.25 |  |  | $    | (0.26 | ) |  | $ | 0.41  |  
|                                                |                                                                   |                            |   |       |                          |  |   |      |  |  |      |      






|    |  |                                                                                                                                                                                                                                             
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Share options and restricted shares are not dilutive to earnings
    per unit for the three months and six months ended June 30,
    2005 but are dilutive to earnings per unit for the three months
    and six months ended June 30, 2004.
|   
|(b) |  | Net (loss) income available to unitholders per unit may not
    total the sum of the per unit components due to rounding.                                                                                                                   



|                            |       |                  |       |                            |      |  |                          |            |  |  |            |            |  |      |            |            |  |  |            |            | 
|--------------------------- | ----- | ---------------- | ----- | -------------------------- | ---- |  | ------------------------ | ---------- |  |  | ---------- | ---------- |  | ---- | ---------- | ---------- |  |  | ---------- | ---------- | 
|                            |       |                  |       | For the three months ended |      |  | For the six months ended |           
|                            |       |                  |       | June 30,                   |      |  | June 30,                 |           
|                            |       | Weighted Average |       |                            |      |  |                          |            | 
|Antidilutive Securities     |       | Exercise Price   |       |                            | 2005 |  |                          | 2004       |  |  | 2005       |            |  | 2004 |           
|                            |       |                  |       |                            |      |  |                          |            |  |  |            |            |  |      |           
|Share options               |       | $                | 28.14 |                            |      |  | 21,927,500               |            |  |  |           |            |  |      |           |            |  |  |           |           
|Share options               |       | $                | 29.09 |                            |      |  |                         |            |  |  | 16,203,300 |            |  |      |           |            |  |  |           |           
|Share options               |       | $                | 27.98 |                            |      |  |                         |            |  |  |           |            |  |      | 22,011,811 |            |  |  |           |           
|Share options               |       | $                | 29.12 |                            |      |  |                         |            |  |  |           |            |  |      |           |            |  |  | 14,896,855 |           
|Series B Preferred Units(c) |       | $                | 35.70 |                            |      |  | 8,389,256                |            |  |  | 8,389,354  |            |  |      | 8,389,273  |            |  |  | 8,389,354  |           
|Restricted Shares           |       | $                | 28.19 |                            |      |  | 2,272,592                |            |  |  |           |            |  |      |           |            |  |  |           |           
|Restricted Shares           |       | $                | 27.94 |                            |      |  |                         |            |  |  |           |            |  |      | 2,148,480  |            |  |  |           |           
|                            |       |                  |       |                            |      |  |                          |            |  |  |            |            |  |      |           
|                            | Total |                  |       |                            |      |  |                          | 32,589,348 |  |  |            | 24,592,654 |  |      |            | 32,549,564 |  |  |            | 23,286,209 | 
|                            |       |                  |       |                            |      |  |                          |            |  |  |            |            |  |      |           






|    |  |                                                                 
|--- |  | ----------------------------------------------------------------
|(c) |  | The amounts shown represent the resulting Units upon conversion.

21



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)


NOTE 11  SEGMENT INFORMATION




|                                                        |                         |                                                          |      |         |                          |  |      |         |         |  |      |           |           |  |      |           |           | 
|------------------------------------------------------- | ----------------------- | -------------------------------------------------------- | ---- | ------- | ------------------------ |  | ---- | ------- | ------- |  | ---- | --------- | --------- |  | ---- | --------- | --------- | 
|                                                        |                         | For the three months ended                               |      |         | For the six months ended | 
|                                                        |                         | June 30,                                                 |      |         | June 30,                 | 
|                                                        |                         |                                                          |      |         |                          | 
|(Dollars in thousands)                                  |                         | 2005                                                     |      |         | 2004                     |  |      | 2005    |         |  | 2004 |          
|                                                        |                         |                                                          |      |         |                          |  |      |         |         |  |      |          
|Property Operating Revenues:                            |                         |                                                          |      |         |                          |  |      |         |         |  |      |           |           |  |      |          
|                                                        | Rental                  |                                                          | $    | 610,323 |                          |  | $    | 601,163 |         |  | $    | 1,213,978 |           |  | $    | 1,193,156 |          
|                                                        | Tenant reimbursements   |                                                          |      | 94,992  |                          |  |      | 103,817 |         |  |      | 191,003   |           |  |      | 200,238   |          
|                                                        | Parking                 |                                                          |      | 29,134  |                          |  |      | 27,427  |         |  |      | 57,272    |           |  |      | 54,867    |          
|                                                        | Other(a)                |                                                          |      | 18,947  |                          |  |      | 12,674  |         |  |      | 77,718    |           |  |      | 37,630    |          
|                                                        |                         |                                                          |      |         |                          |  |      |         |         |  |      |          
|                                                        |                         | Total Property Operating Revenues                        |      |         | 753,396                  |  |      |         | 745,081 |  |      |           | 1,539,971 |  |      |           | 1,485,891 | 
|                                                        |                         |                                                          |      |         |                          |  |      |         |         |  |      |          
|Property Operating Expenses:                            |                         |                                                          |      |         |                          |  |      |         |         |  |      |           |           |  |      |          
|                                                        | Real estate taxes       |                                                          |      | 88,904  |                          |  |      | 94,579  |         |  |      | 176,673   |           |  |      | 172,174   |          
|                                                        | Insurance               |                                                          |      | 8,038   |                          |  |      | 7,404   |         |  |      | 14,743    |           |  |      | 16,039    |          
|                                                        | Repairs and maintenance |                                                          |      | 82,031  |                          |  |      | 77,917  |         |  |      | 158,003   |           |  |      | 152,095   |          
|                                                        | Property operating      |                                                          |      | 104,595 |                          |  |      | 96,901  |         |  |      | 208,687   |           |  |      | 197,460   |          
|                                                        |                         |                                                          |      |         |                          |  |      |         |         |  |      |          
|                                                        |                         | Total Property Operating Expenses                        |      |         | 283,568                  |  |      |         | 276,801 |  |      |           | 558,106   |  |      |           | 537,768   | 
|                                                        |                         |                                                          |      |         |                          |  |      |         |         |  |      |          
|                                                        |                         | Property Net Operating Income from Continuing Operations |      | $       | 469,828                  |  |      | $       | 468,280 |  |      | $         | 981,865   |  |      | $         | 948,123   | 
|                                                        |                         |                                                          |      |         |                          |  |      |         |         |  |      |          
|Property Operating Margin from Continuing Operations(b) |                         |                                                          | 62.4 | %       |                          |  | 62.8 | %       |         |  | 63.8 | %         |           |  | 63.8 | %        
|                                                        |                         |                                                          |      |         |                          |  |      |         |         |  |      |          

22



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)


|                                                                                                                                |                                                                                                                                                        |                            |          |          |                          |   |         |          |   |   |         |          |   |   |         |          |  
|------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------ | -------------------------- | -------- | -------- | ------------------------ | - | ------- | -------- | - | - | ------- | -------- | - | - | ------- | -------- | -
|                                                                                                                                |                                                                                                                                                        | For the three months ended |          |          | For the six months ended |  
|                                                                                                                                |                                                                                                                                                        | June 30,                   |          |          | June 30,                 |  
|                                                                                                                                |                                                                                                                                                        |                            |          |          |                          |  
|(Dollars in thousands)                                                                                                          |                                                                                                                                                        | 2005                       |          |          | 2004                     |   |         | 2005     |   |   | 2004    |         
|                                                                                                                                |                                                                                                                                                        |                            |          |          |                          |   |         |          |   |   |         |         
|Reconciliation of Property Net Operating Income from
    Continuing Operations to (Loss) Income from Continuing
    Operations: |                                                                                                                                                        |                            |          |          |                          |   |         |          |   |   |         |          |   |   |         |         
|Property Net Operating Income from Continuing Operations                                                                        |                                                                                                                                                        | $                          | 469,828  |          |                          | $ | 468,280 |          |   | $ | 981,865 |          |   | $ | 948,123 |         
|Add: Fee income                                                                                                                 |                                                                                                                                                        |                            | 3,697    |          |                          |   | 3,849   |          |   |   | 8,474   |          |   |   | 6,909   |         
|Less:                                                                                                                           |                                                                                                                                                        |                            |          |          |                          |   |         |          |   |   |         |          |   |   |         |         
|                                                                                                                                | Depreciation                                                                                                                                           |                            |          | (171,582 | )                        |   |         | (157,375 | ) |   |         | (337,666 | ) |   |         | (312,276 | )
|                                                                                                                                | Amortization                                                                                                                                           |                            |          | (22,788  | )                        |   |         | (17,288  | ) |   |         | (45,146  | ) |   |         | (33,831  | )
|                                                                                                                                | Ground rent                                                                                                                                            |                            |          | (5,262   | )                        |   |         | (5,034   | ) |   |         | (10,572  | ) |   |         | (10,365  | )
|                                                                                                                                | Corporate general and administrative                                                                                                                   |                            |          | (15,218  | )                        |   |         | (13,709  | ) |   |         | (32,391  | ) |   |         | (25,018  | )
|                                                                                                                                | Impairment                                                                                                                                             |                            |          | (180,856 | )                        |   |         |         |   |   |         | (180,856 | ) |   |         |         |  
|                                                                                                                                |                                                                                                                                                        |                            |          |          |                          |   |         |          |   |   |         |         
|Operating Income                                                                                                                |                                                                                                                                                        |                            | 77,819   |          |                          |   | 278,723 |          |   |   | 383,708 |          |   |   | 573,542 |         
|Less:                                                                                                                           |                                                                                                                                                        |                            |          |          |                          |   |         |          |   |   |         |          |   |   |         |         
|                                                                                                                                | Other expenses                                                                                                                                         |                            |          | (206,883 | )                        |   |         | (184,438 | ) |   |         | (419,235 | ) |   |         | (389,394 | )
|                                                                                                                                | Income taxes                                                                                                                                           |                            |          | (438     | )                        |   |         | (1,333   | ) |   |         | (901     | ) |   |         | (1,069   | )
|                                                                                                                                | Minority interests  partially owned properties                                                                                                        |                            |          | (2,503   | )                        |   |         | (2,647   | ) |   |         | (5,527   | ) |   |         | (5,536   | )
|Add:                                                                                                                            |                                                                                                                                                        |                            |          |          |                          |   |         |          |   |   |         |          |   |   |         |         
|                                                                                                                                | Income from investments in unconsolidated joint ventures
    (including gain on sales of real estate of $17,376, $0, $17,376
    and $0, respectively) |                            |          | 28,681   |                          |   |         | 12,554   |   |   |         | 38,199   |   |   |         | 24,967   |  
|                                                                                                                                |                                                                                                                                                        |                            |          |          |                          |   |         |          |   |   |         |         
|(Loss) Income from Continuing Operations                                                                                        |                                                                                                                                                        | $                          | (103,324 | )        |                          | $ | 102,859 |          |   | $ | (3,756  | )        |   | $ | 202,510 |         
|                                                                                                                                |                                                                                                                                                        |                            |          |          |                          |   |         |          |   |   |         |         






|    |  |                                                                                                                      
|--- |  | ---------------------------------------------------------------------------------------------------------------------
|(a) |  | Other income consists primarily of lease termination income and
    ancillary income from tenants.                   
|   
|(b) |  | Defined as Property Net Operating Income from Continuing
    Operations divided by Total Property Operating Revenues.

NOTE 12  COMMITMENTS AND CONTINGENCIES




| |                             
| | ----------------------------
| | Concentration of Credit Risk





| |              
| | -------------
| | Environmental



23



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




| |           
| | ----------
| | Litigation





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







| |                      
| | ---------------------
| | Property Acquisitions







| |              
| | -------------
| | Contingencies

Accounting for
Contingencies,


24



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)








| |          
| | ---------
| | Insurance

Property Damage, Business Interruption, Earthquake and
Terrorism:


25



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




|                                             |  |                                                                                                                                                                                                  |  |                                           
|-------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ------------------------------------------
|                                             |  | EOP Partnership                                                                                                                                                                                  |  | Third-Party                               
|Type of Insurance Coverage                   |  | Loss Exposure/Deductible                                                                                                                                                                         |  | Coverage 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)                         |  | $4.3 million per occurrence deductible (plus 10% of each
    and every loss with a maximum per occurrence exposure of
    $36.8 million which includes the $4.3 million
    deductible)          |  | $825 million per occurrence (e)           






|    |                                                                                                                                                                                                                                                                                                               
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | We retain up to $75 million annual aggregate loss
    throughout the portfolio. In the event of a loss in excess of
    the per occurrence or annual aggregate amount, the third-party
    insurance carriers would be obligated to cover the losses up to
    the stated coverage amounts in the table above.



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(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 actual
    losses suffered in the event of an earthquake would not exceed
    the amount of such insurance coverage.                                                                                         
|   
|(c) |  | These amounts include our loss exposure/deductible amount.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   
|(d) |  | This coverage includes nuclear, chemical and biological events
    under the Terrorism Insurance Act of 2002 (TRIA).
    TRIA will expire December 31, 2005 and there is a risk it
    will not be extended past that date or extended on its current
    terms. Should the act not be extended or not extended on its
    current terms, the structure, terms or conditions (including
    premiums and coverage) of our terrorism insurance program would
    likely be affected for future periods. We may be unable to
    secure replacement coverage on comparable terms and conditions.



| |                                                                                                                                                                                                                                                                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | This coverage does not apply to non-TRIA 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.



|    |  |                                                    
|--- |  | ---------------------------------------------------
|(e) |  | This amount is in excess of our deductible amounts.

Pollution:


Workers Compensation, Automobile Liability and General
Liability:


26



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




|          |                  
|--------- | -----------------
|NOTE 13  | SUBSEQUENT EVENTS





|                       |  |          |                  |             |      |  |           |                            |         |                        |      |   |         |                |         |  |  |   |        | 
|---------------------- |  | -------- | ---------------- | ----------- | ---- |  | --------- | -------------------------- | ------- | ---------------------- | ---- | - | ------- | -------------- | ------- |  |  | - | ------ | 
|                       |  |          |                  |             |      |  |           | Total Office Portfolio and |        
|                       |  |          |                  |             |      |  |           | Effective Office Portfolio |        
|                       |  |          |                  |             |      |  |           |                            |        
|                       |  |          |                  | Acquisition |      |  | Number of |                            |         | Square                 |      |   |        
|Property               |  | Location |                  |             | Date |  |           | Buildings                  |         |                        | Feet |   |         | Purchase Price |        
|                       |  |          |                  |             |      |  |           |                            |         |                        |      |   |         |                |        
|                       |  |          |                  |             |      |  |           |                            |         | (Dollars in thousands) |     
|25 Mall Road           |  |          | Burlington, MA   |             |      |  | 7/07/2005 |                            |         |                        | 1    |   |         |                | 277,647 |  |  | $ | 54,750 | 
|The Lakes              |  |          | Santa Rosa, CA   |             |      |  | 7/19/2005 |                            |         |                        | 5    |   |         |                | 135,332 |  |  |   | 21,505 | 
|333 Twin Dolphin Plaza |  |          | Redwood City, CA |             |      |  | 7/28/2005 |                            |         |                        | 1    |   |         |                | 185,285 |  |  |   | 52,700 | 
|                       |  |          |                  |             |      |  |           |                            |         |                        |      |   |         |                |        
|                       |  | Total    |                  |             | 7    |  |           |                            | 598,264 |                        |      | $ | 128,955 |               
|                       |  |          |                  |             |      |  |           |                            |         |                        |     

27



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##### Table of Contents



EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




|                   |                                                                                          |          |       |                   |      |    |           |                        |  |             |                            |          |   |         |             |           |      |           |   |         |   |         |  |           |  |  |   |         | 
|------------------ | ---------------------------------------------------------------------------------------- | -------- | ----- | ----------------- | ---- | -- | --------- | ---------------------- |  | ----------- | -------------------------- | -------- | - | ------- | ----------- | --------- | ---- | --------- | - | ------- | - | ------- |  | --------- |  |  | - | ------- | 
|                   |                                                                                          |          |       |                   |      |    |           | Total Office Portfolio |  |             | Effective Office Portfolio |         
|                   |                                                                                          |          |       |                   |      |    |           |                        |  |             |                            |         
|                   |                                                                                          |          |       | Disposition       |      |    | Number of |                        |  |             |                            | Purchase |   |         | Square      |           |      | Purchase  |  
|Property           |                                                                                          | Location |       |                   | Date |    |           | Buildings              |  |             | Square Feet                |          |   | Price   |             |           | Feet |           |   | Price   |  
|                   |                                                                                          |          |       |                   |      |    |           |                        |  |             |                            |          |   |         |             |           |      |           |   |         |  
|                   |                                                                                          |          |       |                   |      |    |           |                        |  | (Dollars in |                            |          |   |         | (Dollars in |          
|                   |                                                                                          |          |       |                   |      |    |           |                        |  | thousands)  |                            |          |   |         | thousands)  |          
|Office properties: |                                                                                          |          |       |                   |      |    |           |                        |  |             |                            |          |   |         |             |           |      |           |   |         |   |         |  |           |  |  |   |        
|                   | 201 Mission Street/ 580 California(a)(b)                                                 |          |       | San Francisco, CA |      |    |           | 7/06/2005              |  |             |                            |         |   |         |             |          |      |           | $ | 217,000 |   |         |  | 597,226   |  |  | $ | 162,750 | 
|                   | The Orchard(b)                                                                           |          |       | Sacramento, CA    |      |    |           | 7/14/2005              |  |             |                            | 1        |   |         |             | 65,392    |      |           |   | 10,700  |   |         |  | 65,392    |  |  |   | 10,700  | 
|                   | Texaco Center/ 601 Garage(b)                                                             |          |       | New Orleans, LA   |      |    |           | 7/25/2005              |  |             |                            | 1        |   |         |             | 629,428   |      |           |   | 49,000  |   |         |  | 629,428   |  |  |   | 49,000  | 
|                   | Meier Mountain View Buildings 5-10, 17 and 20(c)                                         |          |       | Mountain View, CA |      |    |           | 7/27/2005              |  |             |                            | 7        |   |         |             | 242,658   |      |           |   | 34,200  |   |         |  | 242,658   |  |  |   | 34,200  | 
|                   | Ravendale at Central                                                                     |          |       | Mountain View, CA |      |    |           | 7/27/2005              |  |             |                            | 2        |   |         |             | 80,450    |      |           |   | 10,100  |   |         |  | 80,450    |  |  |   | 10,100  | 
|                   | Bayside Corporate Center                                                                 |          |       | Foster City, CA   |      |    |           | 7/27/2005              |  |             |                            | 2        |   |         |             | 84,925    |      |           |   | 7,000   |   |         |  | 84,925    |  |  |   | 7,000   | 
|                   | Ridder Park                                                                              |          |       | San Jose, CA      |      |    |           | 7/27/2005              |  |             |                            | 1        |   |         |             | 83,841    |      |           |   | 19,600  |   |         |  | 83,841    |  |  |   | 19,600  | 
|                   | Vintage Park Industrial and Vintage Park Office Building III                             |          |       | Foster City, CA   |      |    |           | 7/27/2005              |  |             |                            | 6        |   |         |             | 162,094   |      |           |   | 25,200  |   |         |  | 162,094   |  |  |   | 25,200  | 
|                   | Creekside I and II                                                                       |          |       | San Jose, CA      |      |    |           | 7/27/2005              |  |             |                            | 4        |   |         |             | 241,019   |      |           |   | 38,988  |   |         |  | 241,019   |  |  |   | 38,988  | 
|                   | Aspect Telecommunications                                                                |          |       | San Jose, CA      |      |    |           | 7/27/2005              |  |             |                            | 1        |   |         |             | 76,806    |      |           |   | 5,612   |   |         |  | 76,806    |  |  |   | 5,612   | 
|                   | Redwood Shores                                                                           |          |       | Redwood City, CA  |      |    |           | 7/27/2005              |  |             |                            | 1        |   |         |             | 78,022    |      |           |   | 8,600   |   |         |  | 78,022    |  |  |   | 8,600   | 
|                   | 2500 City West, Brookhollow Central, Intercontinental Center and
    San Felipe Plaza(d) |          |       | Houston, TX       |      |    |           | 8/04/2005              |  |             |                            | 6        |   |         |             | 2,526,454 |      |           |   | 280,500 |   |         |  | 2,526,454 |  |  |   | 280,500 | 
|Vacant land:       |                                                                                          |          |       |                   |      |    |           |                        |  |             |                            |          |   |         |             |           |      |           |   |         |   |         |  |           |  |  |   |        
|                   | Stadium Towers Land                                                                      |          |       | Anaheim, CA       |      |    |           | 7/18/2005              |  |             |                            |         |   |         |             |          |      |           |   | 3,000   |   |         |  |          |  |  |   | 3,000   | 
|                   |                                                                                          |          |       |                   |      |    |           |                        |  |             |                            |          |   |         |             |           |      |           |   |         |  
|                   |                                                                                          |          | Total |                   |      | 32 |           |                        |  | 4,271,089   |                            |          | $ | 709,500 |             |           |      | 4,868,315 |   |         | $ | 655,250 | 
|                   |                                                                                          |          |       |                   |      |    |           |                        |  |             |                            |          |   |         |             |           |     






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | At June 30, 2005, 75% of our interest in these two office
    properties comprising 796,301 square feet was deemed held
    for sale. Following disposition, we retained a 25% ownership
    interest in these properties. These two buildings will remain in
    our building count for the Total Office Portfolio and the
    Effective Office Portfolio. The total square feet of these
    buildings will remain in our Total Office Portfolio statistics;
    however, the square feet included in the Effective Office
    Portfolio will be reduced to reflect our 25% ownership interest.



|    |  |                                                                                                                                                                                                                       
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(b) |  | These properties, or a portion thereof, were classified as held
    for sale at June 30, 2005.                                                                                                                        
|   
|(c) |  | Meier Mountain View Building 17, which consists of one
    building and 27,790 square feet, was previously taken out
    of service and is not included in the seven buildings and
    242,658 square feet statistics.

28



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EOP OPERATING LIMITED PARTNERSHIP


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


(Unaudited)




|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(d) |  | We owned San Felipe Plaza in a partnership with an
    affiliate of Mr. Sam Zell, the Chairman of Equity
    Offices Board of Trustees. In accordance with the
    agreements governing the ownership of this property, we agreed
    to pay any capital gains tax incurred by the affiliate if the
    property was sold. As a result of the sale of this property on
    August 4, 2005, we are obligated to pay approximately
    $0.7 million to this affiliate to cover its capital gains
    tax liability.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Prior to the sale, San Felipe Plaza was encumbered by a
    5.81% mortgage note scheduled to mature in 2013 and having an
    outstanding principal balance of approximately
    $47.9 million as of June 30, 2005. In order to avoid
    incurring a prepayment penalty of approximately
    $4.9 million the lender agreed to substitute the 1300 North
    17th Street
    office property, located in Arlington, Virginia, as replacement
    collateral. The terms of the mortgage note were otherwise
    unchanged as a result of this transaction.



|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3. | We entered into a $1.25 billion revolving line of credit
    facility bearing interest at LIBOR plus 47.5 basis points
    plus an annual facility fee of 15 basis points. This line
    of credit facility matures in August 2009 and has an increased
    number of participating lenders over our prior revolving line of
    credit facility. We have one option to extend the maturity date
    for an additional 12-month period. The extension fee is equal to
    15 basis points on $1.25 billion, or $1.875 million.
    The existing $1.0 billion line of credit scheduled to
    mature in May 2006 terminated in August 2005 effective with the
    first funding of the new $1.25 billion line of credit.
|  
|4. | We repaid approximately $526.3 million of mortgage debt
    that encumbered the 1301 Avenue of the Americas office property
    located in New York, NY.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|  
|5. | We repaid and terminated our $250 million term loan
    facility.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|  
|6. | We repaid $100 million of 8.0% unsecured notes upon
    maturity.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

29



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##### Table of Contents








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

Forward-Looking Statements






Overview






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



| |                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------
| | Period-to-period comparison of our results of operations for
    the three and six months ended June 30, 2005 and 2004.



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



| |                                                                                                                                                                                                                                                                                                                           
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | A discussion of our liquidity and capital resources,
    including distributions to our unitholders, contractual
    obligations, debt financing, equity securities, market risk,
    capital improvements, tenant improvements, leasing costs,
    developments, inflation, cash flows and additional items for
    2005.



| |   |                              
| | - | -----------------------------
| |  | Funds From Operations (FFO)



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

Executive Summary




30



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##### Table of Contents











| |   |                                               
| | - | ----------------------------------------------
| |  | Economic Environment and Office Job Growth    
|
| |  | Acquisition and Disposition Activity          
|
| |  | Leasing Results for the Total Office Portfolio
|
| |  | Cash Requirements                             



| |                                           
| | ------------------------------------------
| | Economic Environment and Office Job Growth











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



31



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##### Table of Contents











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









32



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##### Table of Contents





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





| |                                                                         
| | ------------------------------------------------------------------------
| | Key Transactions Completed During the Six Months Ended
    June 30, 2005



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



| |   |                                                                                                                                                                                                                                                                     
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We disposed of approximately $1.6 billion in assets,
    consisting of 79 office properties (including six properties
    comprising approximately 149,131 square feet previously
    taken out of service) comprising approximately 9.1 million
    square feet and
|
| |  | acquired $354.9 million in assets, consisting of 18 office
    properties comprising approximately 1.5 million square
    feet, one development property comprising approximately
    0.1 million square feet and a vacant land parcel.                             



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



| |   |                                                                                                                                                                 
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We obtained a $250 million unsecured term loan facility,
    which bore interest at LIBOR plus 35 basis points and was
    scheduled to mature in February 2006,
|
| |  | repaid $525 million of unsecured notes and approximately
    $349.6 million of mortgage debt and                                                                
|
| |  | terminated a $250 million interest rate swap at no cost
    that previously converted certain fixed rate unsecured notes to
    a floating rate.                



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



| |   |                                                                                                                                                                        
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We recorded $79.6 million of gains on asset sales and
    recorded non-cash charges of approximately $380.6 million
    on assets sold and assets we intend to sell and
|
| |  | recorded approximately $44.4 million of income from a
    single lease termination.                                                                                    

33



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##### Table of Contents



Results of Operations




| |                                                                        
| | -----------------------------------------------------------------------
| | Trends in Occupancy and Rental Rates for the Total Office
    Portfolio



|                        |                                                                                                            |                            |  |           |                          |  |  |           |       |  |      |            |       |  |  |            |       | 
|----------------------- | ---------------------------------------------------------------------------------------------------------- | -------------------------- |  | --------- | ------------------------ |  |  | --------- | ----- |  | ---- | ---------- | ----- |  |  | ---------- | ----- | 
|                        |                                                                                                            | For the three months ended |  |           | For the six months ended | 
|                        |                                                                                                            | June 30,                   |  |           | June 30,                 | 
|                        |                                                                                                            |                            |  |           |                          | 
|Office Property Data:   |                                                                                                            | 2005                       |  |           | 2004                     |  |  | 2005      |       |  | 2004 |           
|                        |                                                                                                            |                            |  |           |                          |  |  |           |       |  |      |           
|10 Largest Markets:     |                                                                                                            |                            |  |           |                          |  |  |           |       |  |      |            |       |  |  |           
|                        | Portion of Total Office Portfolio based on square feet at end of
    period                                |                            |  | 72.2      | %                        |  |  | 69.8      | %     |  |      | 72.2       | %     |  |  | 69.8       | %    
|                        | Occupancy at end of period                                                                                 |                            |  | 88.5      | %                        |  |  | 86.1      | %     |  |      | 88.5       | %     |  |  | 86.1       | %    
|                        | Gross square footage for tenants whose lease term commenced
    during the period                          |                            |  | 3,563,111 |                          |  |  | 3,659,585 |       |  |      | 7,591,296  |       |  |  | 7,320,405  |      
|                        | Weighted average annual rent per square foot for tenants whose
    lease term commenced during the period: |                            |  |           |                          |  |  |           |       |  |      |            |       |  |  |            |      
|                        |                                                                                                            | GAAP basis(a)(b)           |  | $         | 30.82                    |  |  | $         | 26.79 |  |      | $          | 29.74 |  |  | $          | 26.76 | 
|                        |                                                                                                            | Cash basis(b)(c)           |  | $         | 30.05                    |  |  | $         | 25.70 |  |      | $          | 28.34 |  |  | $          | 25.87 | 
|                        | Gross square footage for expiring and terminated leases during
    the period                              |                            |  | 3,454,464 |                          |  |  | 3,729,685 |       |  |      | 7,445,498  |       |  |  | 7,466,587  |      
|                        | Weighted average annual rent per square foot for expiring and
    terminated leases during the period:     |                            |  |           |                          |  |  |           |       |  |      |            |       |  |  |            |      
|                        |                                                                                                            | GAAP basis(b)              |  |           | 32.58                    |  |  | $         | 31.05 |  |      |            | 31.96 |  |  | $          | 30.37 | 
|                        |                                                                                                            | Cash basis(c)              |  |           | 33.48                    |  |  | $         | 32.31 |  |      |            | 32.83 |  |  | $          | 31.45 | 
|Total Office Portfolio: |                                                                                                            |                            |  |           |                          |  |  |           |       |  |      |            |       |  |  |           
|                        | Occupancy at end of period                                                                                 |                            |  | 88.4      | %                        |  |  | 86.3      | %     |  |      | 88.4       | %     |  |  | 86.3       | %    
|                        | Gross square footage for tenants whose lease term commenced
    during the period                          |                            |  | 4,692,085 |                          |  |  | 6,242,599 |       |  |      | 10,699,742 |       |  |  | 11,657,011 |      
|                        | Weighted average annual rent per square foot for tenants whose
    lease term commenced during the period: |                            |  |           |                          |  |  |           |       |  |      |            |       |  |  |            |      
|                        |                                                                                                            | GAAP basis(a)(b)           |  | $         | 28.60                    |  |  | $         | 23.25 |  |      | $          | 27.19 |  |  | $          | 23.84 | 
|                        |                                                                                                            | Cash basis(b)(c)           |  | $         | 27.83                    |  |  | $         | 22.57 |  |      | $          | 26.11 |  |  | $          | 23.16 | 
|                        | Gross square footage for expiring and terminated leases during
    the period                              |                            |  | 4,445,114 |                          |  |  | 6,153,544 |       |  |      | 10,621,890 |       |  |  | 11,758,555 |      
|                        | Weighted average annual rent per square foot for expiring and
    terminated leases during the period:     |                            |  |           |                          |  |  |           |       |  |      |            |       |  |  |            |      
|                        |                                                                                                            | GAAP basis(b)              |  | $         | 30.07                    |  |  | $         | 27.15 |  |      | $          | 29.10 |  |  | $          | 26.96 | 
|                        |                                                                                                            | Cash basis(c)              |  | $         | 30.94                    |  |  | $         | 28.03 |  |      | $          | 29.89 |  |  | $          | 27.82 | 






|    |  |                                                                                                                                   
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------
|(a) |  | Based on the average annual base rent per square foot over the
    lease term and current estimated tenant reimbursements, if any.

34



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|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(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) |  | Based on the monthly contractual rent when the lease commenced,
    expired or terminated multiplied by 12 months. 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 abatements or contractual increases
    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



|                        |                   |                                     |                         |     |             |     |   |             |           |            |  
|----------------------- | ----------------- | ----------------------------------- | ----------------------- | --- | ----------- | --- | - | ----------- | --------- | ---------- | -
|                        |                   | Total Office Portfolio              |                        
|                        |                   |                                     |                        
|                        |                   | Buildings                           |                         |     | Square Feet |    
|                        |                   |                                     |                         |     |             |    
|Properties Owned as of: |                   |                                     |                         |     |             |     |   |            
|                        | December 31, 2003 |                                     |                         | 684 |             |     |   | 122,254,925 |          
|                        |                   | Consolidation of Sun America Center |                         |     | 1           |     |   |             | 780,063   |           
|                        |                   | Acquisitions                        |                         |     | 27          |     |   |             | 3,315,232 |           
|                        |                   | Developments placed in service      |                         |     | 2           |     |   |             | 298,689   |           
|                        |                   | Dispositions(a)                     |                         |     | (5          | )   |   |             | (567,765  | )         
|                        |                   | Properties taken out of service(b)  |                         |     | (11         | )   |   |             | (469,771  | )         
|                        |                   | Building remeasurements             |                         |     |            |     |   |             | 101,872   |           
|                        |                   |                                     |                         |     |             |    
|                        | December 31, 2004 |                                     |                         | 698 |             |     |   | 125,713,245 |          
|                        |                   |                                     | Acquisitions            |     |             | 4   |   |             |           | 296,657    |  
|                        |                   |                                     | Dispositions            |     |             | (14 | ) |             |           | (1,546,017 | )
|                        |                   |                                     | Building remeasurements |     |             |    |   |             |           | 28,384     |  
|                        |                   |                                     |                         |     |             |    
|                        | March 31, 2005    |                                     |                         | 688 |             |     |   | 124,492,269 |          
|                        |                   |                                     | Acquisitions            |     |             | 14  |   |             |           | 1,232,553  |  
|                        |                   |                                     | Dispositions            |     |             | (59 | ) |             |           | (7,849,852 | )
|                        |                   |                                     | Building Remeasurements |     |             |    |   |             |           | 42,435     |  
|                        |                   |                                     |                         |     |             |    
|                        | June 30, 2005     |                                     |                         | 643 |             |     |   | 117,917,405 |          
|                        |                   |                                     |                         |     |             |    






|    |                                                                                                                     
|--- | --------------------------------------------------------------------------------------------------------------------
|(a) | Excludes any partial sales of real estate because the properties
    are still included in our portfolio statistics.



|    |  |                                                                                                      
|--- |  | -----------------------------------------------------------------------------------------------------
|(b) |  | Properties taken out of service represent office properties we
    are no longer attempting to lease.



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





35



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| |                                                                                               
| | ----------------------------------------------------------------------------------------------
| | Comparison of the three months ended June 30, 2005 to
    the three months ended June 30, 2004



|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |         |         |         |          |         |         |          |       |       |       |       |  
|---------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------- | ---------------------------- | ---------------- | -------- | -------------------- | ------ | ------- | -------- | -------- | ------- | -------- | ------- | ------- | -------- | ------ | ------ | ---- | ----- | ------ | ------- | ------- | ------- | ------- | ------- | ------- | ------- | -------- | ------- | ------- | -------- | ----- | ----- | ----- | ----- | -
|                                                                                                                                         |                                                                                  | Total Company                |                  |          | Same Store Portfolio |       
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |       
|                                                                                                                                         |                                                                                  |                              |                  | Change   |                      |        |         |          | Change   |        
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |        
|(Dollars in thousands)                                                                                                                   |                                                                                  | 2005                         |                  |          | 2004                 |        |         | $        |          |         | %        |         |         | 2005     |        |        | 2004 |       |        | $       |         |         | %       |        
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |        
|Revenues:                                                                                                                                |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |         |         |         |          |         |         |          |       |      
|                                                                                                                                         | Property operating revenues                                                      |                              | $                | 753,396  |                      |        | $       | 745,081  |          |         | $        | 8,315   |         |          |        | 1.1    | %    |       | $      | 731,691 |         |         | $       | 733,049 |         |         | $        | (1,358  | )       |          |       | (0.2  | )%   
|                                                                                                                                         | Fee income                                                                       |                              |                  | 3,697    |                      |        |         | 3,849    |          |         |          | (152    | )       |          |        | (3.9   | )    |       |        |        |         |         |         |        |         |         |          |        |         |          |       |      |      
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |        
|                                                                                                                                         |                                                                                  | Total revenues               |                  |          | 757,093              |        |         |          | 748,930  |         |          |         | 8,163   |          |        |        | 1.1  |       |        |         | 731,691 |         |         |         | 733,049 |         |          |         | (1,358  | )        |       |       | (0.2  | )    
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |        
|Expenses:                                                                                                                                |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |         |         |         |          |         |         |          |       |      
|                                                                                                                                         | Depreciation and amortization                                                    |                              |                  | 194,370  |                      |        |         | 174,663  |          |         |          | 19,707  |         |          |        | 11.3   |      |       |        | 179,706 |         |         |         | 167,319 |         |         |          | 12,387  |         |          |       | 7.4   |      
|                                                                                                                                         | Real estate taxes                                                                |                              |                  | 88,904   |                      |        |         | 94,579   |          |         |          | (5,675  | )       |          |        | (6.0   | )    |       |        | 85,166  |         |         |         | 92,698  |         |         |          | (7,532  | )       |          |       | (8.1  | )    
|                                                                                                                                         | Property operating expenses                                                      |                              |                  | 194,664  |                      |        |         | 182,222  |          |         |          | 12,442  |         |          |        | 6.8    |      |       |        | 189,031 |         |         |         | 178,395 |         |         |          | 10,636  |         |          |       | 6.0   |      
|                                                                                                                                         | Ground rent                                                                      |                              |                  | 5,262    |                      |        |         | 5,034    |          |         |          | 228     |         |          |        | 4.5    |      |       |        | 5,071   |         |         |         | 4,966   |         |         |          | 105     |         |          |       | 2.1   |      
|                                                                                                                                         | General and administrative(a)                                                    |                              |                  | 15,218   |                      |        |         | 13,709   |          |         |          | 1,509   |         |          |        | 11.0   |      |       |        |        |         |         |         |        |         |         |          |        |         |          |       |      |      
|                                                                                                                                         | Impairment                                                                       |                              |                  | 180,856  |                      |        |         |         |          |         |          | 180,856 |         |          |        |       |      |       |        | 159,912 |         |         |         |        |         |         |          | 159,912 |         |          |       |      |      
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |        
|                                                                                                                                         |                                                                                  | Total expenses               |                  |          | 679,274              |        |         |          | 470,207  |         |          |         | 209,067 |          |        |        | 44.5 |       |        |         | 618,886 |         |         |         | 443,378 |         |          |         | 175,508 |          |       |       | 39.6  |      
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |        
|                                                                                                                                         |                                                                                  |                              | Operating income |          |                      | 77,819 |         |          |          | 278,723 |          |         |         | (200,904 | )      |        |      | (72.1 | )      |         |         | 112,805 |         |         |         | 289,671 |          |         |         | (176,866 | )     |       |       | (61.1 | )
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |        
|Other income (expense):                                                                                                                  |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |         |         |         |          |         |         |          |       |      
|                                                                                                                                         | Interest and dividend income                                                     |                              |                  | 3,646    |                      |        |         | 2,405    |          |         |          | 1,241   |         |          |        | 51.6   |      |       |        | 2,199   |         |         |         | 723     |         |         |          | 1,476   |         |          |       | 204.1 |      
|                                                                                                                                         | Realized gain on settlement of derivatives and sale of
    marketable securities |                              |                  |         |                      |        |         | 24,016   |          |         |          | (24,016 | )       |          |        | (100.0 | )    |       |        |        |         |         |         |        |         |         |          |        |         |          |       |      |      
|                                                                                                                                         | Interest expense(b)                                                              |                              |                  | (210,529 | )                    |        |         | (210,859 | )        |         |          | 330     |         |          |        | (0.2   | )    |       |        | (47,822 | )       |         |         | (56,525 | )       |         |          | 8,703   |         |          |       | (15.4 | )    
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |        
|                                                                                                                                         |                                                                                  | Total other income (expense) |                  |          | (206,883             | )      |         |          | (184,438 | )       |          |         | (22,445 | )        |        |        | 12.2 |       |        |         | (45,623 | )       |         |         | (55,802 | )       |          |         | 10,179  |          |       |       | (18.2 | )    
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |        
|(Loss) income before income taxes, allocation to minority
    interests and income from investments in unconsolidated joint
    ventures |                                                                                  |                              | (129,064         | )        |                      |        | 94,285  |          |          |         | (223,349 | )       |         |          | (236.9 | )      |      |       | 67,182 |         |         |         | 233,869 |         |         |         | (166,687 | )       |         |          | (71.3 | )    
|Income taxes                                                                                                                             |                                                                                  |                              | (438             | )        |                      |        | (1,333  | )        |          |         | 895      |         |         |          | (67.1  | )      |      |       | (72    | )       |         |         | (333    | )       |         |         | 261      |         |         |          | (78.4 | )    
|Minority Interests:                                                                                                                      |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |         |         |         |          |         |         |          |       |      
|                                                                                                                                         | Partially owned properties                                                       |                              |                  | (2,503   | )                    |        |         | (2,647   | )        |         |          | 144     |         |          |        | (5.4   | )    |       |        | (2,499  | )       |         |         | (2,647  | )       |         |          | 148     |         |          |       | (5.6  | )    
|Income from investments in unconsolidated joint ventures                                                                                 |                                                                                  |                              | 28,681           |          |                      |        | 12,554  |          |          |         | 16,127   |         |         |          | 128.5  |        |      |       | 9,009  |         |         |         | 11,362  |         |         |         | (2,353   | )       |         |          | (20.7 | )    
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |        
|(Loss) income from continuing operations                                                                                                 |                                                                                  |                              | (103,324         | )        |                      |        | 102,859 |          |          |         | (206,183 | )       |         |          | (200.5 | )      |      |       | 73,620 |         |         |         | 242,251 |         |         |         | (168,631 | )       |         |          | (69.6 | )    
|Discontinued operations                                                                                                                  |                                                                                  |                              | (117,094         | )        |                      |        | 18,759  |          |          |         | (135,853 | )       |         |          | (724.2 | )      |      |       |       |         |         |         |        |         |         |         |         |         |         |          |      |      
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |        
|Net (loss) income                                                                                                                        |                                                                                  | $                            | (220,418         | )        |                      | $      | 121,618 |          |          | $       | (342,036 | )       |         |          | (281.2 | )%     |      | $     | 73,620 |         |         | $       | 242,251 |         |         | $       | (168,631 | )       |         |          | (69.6 | )%   
|                                                                                                                                         |                                                                                  |                              |                  |          |                      |        |         |          |          |         |          |         |         |          |        |        |      |       |        |         |         |         |         |        

36



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|                                           |                                  |               |   |         |                      |  |   |         |        |  |   |        |   |      |  |       |      |  |   |         |  |  |   |         |  |  |   |        |   |  |  |       |   
|------------------------------------------ | -------------------------------- | ------------- | - | ------- | -------------------- |  | - | ------- | ------ |  | - | ------ | - | ---- |  | ----- | ---- |  | - | ------- |  |  | - | ------- |  |  | - | ------ | - |  |  | ----- | --
|                                           |                                  | Total Company |   |         | Same Store Portfolio | 
|                                           |                                  |               |   |         |                      | 
|                                           |                                  |               |   | Change  |                      |  |   |         | Change | 
|                                           |                                  |               |   |         |                      |  |   |         |        | 
|(Dollars in thousands)                     |                                  | 2005          |   |         | 2004                 |  |   | $       |        |  | % |        |   | 2005 |  |       | 2004 |  |   | $       |  |  | % |        
|                                           |                                  |               |   |         |                      |  |   |         |        |  |   |        |   |      |  |       |      |  |   |         |  |  |   |        
|Selected Items from Continuing Operations: |                                  |               |   |         |                      |  |   |         |        |  |   |        |   |      |  |       |      |  |   |         |  |  |   |         |  |  |   |        |   |  |  |      
|                                           | Property net operating income(c) |               | $ | 469,828 |                      |  | $ | 468,280 |        |  | $ | 1,548  |   |      |  | 0.3   | %    |  | $ | 457,494 |  |  | $ | 461,956 |  |  | $ | (4,462 | ) |  |  | (1.0  | )%
|                                           |                                  |               |   |         |                      |  |   |         |        |  |   |        |   |      |  |       |      |  |   |         |  |  |   |        
|                                           | Deferred rental revenue          |               | $ | 15,417  |                      |  | $ | 22,075  |        |  | $ | (6,658 | ) |      |  | (30.2 | )%   |  | $ | 13,761  |  |  | $ | 20,847  |  |  | $ | (7,086 | ) |  |  | (34.0 | )%
|                                           |                                  |               |   |         |                      |  |   |         |        |  |   |        |   |      |  |       |      |  |   |         |  |  |   |        
|                                           | Lease termination fees           |               | $ | 10,538  |                      |  | $ | 7,611   |        |  | $ | 2,927  |   |      |  | 38.5  | %    |  | $ | 10,538  |  |  | $ | 7,656   |  |  | $ | 2,882  |   |  |  | 37.6  | % 
|                                           |                                  |               |   |         |                      |  |   |         |        |  |   |        |   |      |  |       |      |  |   |         |  |  |   |        






|    |                                                                                                                                                                                             
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(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 Note 11 to the financial
    statements for more information.                                                                                                                                                                                                  



| |                            
| | ---------------------------
| | Property Operating Revenues







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







| |                  
| | -----------------
| | Real Estate Taxes





37



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##### Table of Contents





| |                            
| | ---------------------------
| | Property Operating Expenses







| |                                    
| | -----------------------------------
| | General and Administrative Expenses





| |           
| | ----------
| | Impairment



Realized Gain on Settlement of
Derivatives and Sale of Marketable Securities






| |                 
| | ----------------
| | Interest Expense





| |                                                         
| | --------------------------------------------------------
| | Income from Investments in Unconsolidated Joint Ventures



38



---



##### Table of Contents





| |                        
| | -----------------------
| | Discontinued Operations





| |                                                                                           
| | ------------------------------------------------------------------------------------------
| | Comparison of the six months ended June 30, 2005 to
    the six months ended June 30, 2004



|                       |                               |                |                  |           |                      |         |   |           |           |         |   |         |         |          |   |      |      |       |   |           |           |         |   |           |           |         |   |         |         |          |   |      |      |       |  
|---------------------- | ----------------------------- | -------------- | ---------------- | --------- | -------------------- | ------- | - | --------- | --------- | ------- | - | ------- | ------- | -------- | - | ---- | ---- | ----- | - | --------- | --------- | ------- | - | --------- | --------- | ------- | - | ------- | ------- | -------- | - | ---- | ---- | ----- | -
|                       |                               | Total Company  |                  |           | Same Store Portfolio |        
|                       |                               |                |                  |           |                      |        
|                       |                               |                |                  | Change    |                      |         |   |           | Change    |        
|                       |                               |                |                  |           |                      |         |   |           |           |        
|(Dollars in thousands) |                               | 2005           |                  |           | 2004                 |         |   | $         |           |         | % |         |         | 2005     |   |      | 2004 |       |   | $         |           |         | % |          
|                       |                               |                |                  |           |                      |         |   |           |           |         |   |         |         |          |   |      |      |       |   |           |           |         |   |          
|Revenues:              |                               |                |                  |           |                      |         |   |           |           |         |   |         |         |          |   |      |      |       |   |           |           |         |   |           |           |         |   |         |         |          |   |     
|                       | Property operating revenues   |                | $                | 1,539,971 |                      |         | $ | 1,485,891 |           |         | $ | 54,080  |         |          |   | 3.6  | %    |       | $ | 1,397,868 |           |         | $ | 1,411,585 |           |         | $ | (13,717 | )       |          |   | (1.0 | )%  
|                       | Fee income                    |                |                  | 8,474     |                      |         |   | 6,909     |           |         |   | 1,565   |         |          |   | 22.7 |      |       |   |          |           |         |   |          |           |         |   |        |         |          |   |     |     
|                       |                               |                |                  |           |                      |         |   |           |           |         |   |         |         |          |   |      |      |       |   |           |           |         |   |          
|                       |                               | Total revenues |                  |           | 1,548,445            |         |   |           | 1,492,800 |         |   |         | 55,645  |          |   |      | 3.7  |       |   |           | 1,397,868 |         |   |           | 1,411,585 |         |   |         | (13,717 | )        |   |      | (1.0 | )    
|                       |                               |                |                  |           |                      |         |   |           |           |         |   |         |         |          |   |      |      |       |   |           |           |         |   |          
|Expenses:              |                               |                |                  |           |                      |         |   |           |           |         |   |         |         |          |   |      |      |       |   |           |           |         |   |           |           |         |   |         |         |          |   |     
|                       | Depreciation and amortization |                |                  | 382,812   |                      |         |   | 346,107   |           |         |   | 36,705  |         |          |   | 10.6 |      |       |   | 347,667   |           |         |   | 325,583   |           |         |   | 22,084  |         |          |   | 6.8  |     
|                       | Real estate taxes             |                |                  | 176,673   |                      |         |   | 172,174   |           |         |   | 4,499   |         |          |   | 2.6  |      |       |   | 157,578   |           |         |   | 161,179   |           |         |   | (3,601  | )       |          |   | (2.2 | )   
|                       | Property operating expenses   |                |                  | 381,433   |                      |         |   | 365,594   |           |         |   | 15,839  |         |          |   | 4.3  |      |       |   | 361,973   |           |         |   | 350,937   |           |         |   | 11,036  |         |          |   | 3.1  |     
|                       | Ground rent                   |                |                  | 10,572    |                      |         |   | 10,365    |           |         |   | 207     |         |          |   | 2.0  |      |       |   | 10,239    |           |         |   | 10,227    |           |         |   | 12      |         |          |   | 0.1  |     
|                       | General and administrative(a) |                |                  | 32,391    |                      |         |   | 25,018    |           |         |   | 7,373   |         |          |   | 29.5 |      |       |   |          |           |         |   |          |           |         |   |        |         |          |   |     |     
|                       | Impairment                    |                |                  | 180,856   |                      |         |   |          |           |         |   | 180,856 |         |          |   |     |      |       |   | 159,912   |           |         |   |          |           |         |   | 159,912 |         |          |   |     |     
|                       |                               |                |                  |           |                      |         |   |           |           |         |   |         |         |          |   |      |      |       |   |           |           |         |   |          
|                       |                               | Total expenses |                  |           | 1,164,737            |         |   |           | 919,258   |         |   |         | 245,479 |          |   |      | 26.7 |       |   |           | 1,037,369 |         |   |           | 847,926   |         |   |         | 189,443 |          |   |      | 22.3 |      
|                       |                               |                |                  |           |                      |         |   |           |           |         |   |         |         |          |   |      |      |       |   |           |           |         |   |          
|                       |                               |                | Operating income |           |                      | 383,708 |   |           |           | 573,542 |   |         |         | (189,834 | ) |      |      | (33.1 | ) |           |           | 360,499 |   |           |           | 563,659 |   |         |         | (203,160 | ) |      |      | (36.0 | )
|                       |                               |                |                  |           |                      |         |   |           |           |         |   |         |         |          |   |      |      |       |   |           |           |         |   |          

39



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|                                                                                                                                         |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |         |         |   |          |         |        |  |        |       |       |  
|---------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------- | ---------------------------- | ------- | -------- | -------------------- | - | ------- | -------- | -------- | - | -------- | ------- | ------- | ---- | ------ | ------ | ---- | - | ------- | ------- | ------- | - | ------- | ------- | ------- | - | -------- | ------- | ------ |  | ------ | ----- | ----- | -
|                                                                                                                                         |                                                                                  | Total Company                |         |          | Same Store Portfolio |  
|                                                                                                                                         |                                                                                  |                              |         |          |                      |  
|                                                                                                                                         |                                                                                  |                              |         | Change   |                      |   |         |          | Change   |  
|                                                                                                                                         |                                                                                  |                              |         |          |                      |   |         |          |          |  
|(Dollars in thousands)                                                                                                                   |                                                                                  | 2005                         |         |          | 2004                 |   |         | $        |          |   | %        |         |         | 2005 |        |        | 2004 |   |         | $       |         |   | %       |        
|                                                                                                                                         |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |        
|Other income (expense):                                                                                                                  |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |         |         |   |          |         |        |  |        |      
|                                                                                                                                         | Interest and dividend income                                                     |                              |         | 6,862    |                      |   |         | 3,721    |          |   |          | 3,141   |         |      |        | 84.4   |      |   |         | 3,052   |         |   |         | 1,693   |         |   |          | 1,359   |        |  |        | 80.3  |      
|                                                                                                                                         | Realized gain on settlement of derivatives and sale of
    marketable securities |                              |         | 3        |                      |   |         | 24,016   |          |   |          | (24,013 | )       |      |        | (100.0 | )    |   |         |        |         |   |         |        |         |   |          |        |        |  |        |      |      
|                                                                                                                                         | Interest expense(b)                                                              |                              |         | (426,100 | )                    |   |         | (417,131 | )        |   |          | (8,969  | )       |      |        | 2.2    |      |   |         | (81,556 | )       |   |         | (94,303 | )       |   |          | 12,747  |        |  |        | (13.5 | )    
|                                                                                                                                         |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |        
|                                                                                                                                         |                                                                                  | Total other income (expense) |         |          | (419,235             | ) |         |          | (389,394 | ) |          |         | (29,841 | )    |        |        | 7.7  |   |         |         | (78,504 | ) |         |         | (92,610 | ) |          |         | 14,106 |  |        |       | (15.2 | )
|                                                                                                                                         |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |        
|(Loss) income before income taxes, allocation to minority
    interests and income from investments in unconsolidated joint
    ventures |                                                                                  |                              | (35,527 | )        |                      |   | 184,148 |          |          |   | (219,675 | )       |         |      | (119.3 | )      |      |   | 281,995 |         |         |   | 471,049 |         |         |   | (189,054 | )       |        |  | (40.1  | )    
|Income taxes                                                                                                                             |                                                                                  |                              | (901    | )        |                      |   | (1,069  | )        |          |   | 168      |         |         |      | (15.7  | )      |      |   | (377    | )       |         |   | (326    | )       |         |   | (51      | )       |        |  | 15.6   |      
|Minority Interests:                                                                                                                      |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |         |         |   |          |         |        |  |        |      
|                                                                                                                                         | Partially owned properties                                                       |                              |         | (5,527   | )                    |   |         | (5,536   | )        |   |          | 9       |         |      |        | (0.2   | )    |   |         | (5,527  | )       |   |         | (5,536  | )       |   |          | 9       |        |  |        | (0.2  | )    
|Income from investments in unconsolidated joint ventures                                                                                 |                                                                                  |                              | 38,199  |          |                      |   | 24,967  |          |          |   | 13,232   |         |         |      | 53.0   |        |      |   | 15,703  |         |         |   | 22,171  |         |         |   | (6,468   | )       |        |  | (29.2  | )    
|                                                                                                                                         |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |        
|(Loss) income from continuing operations                                                                                                 |                                                                                  |                              | (3,756  | )        |                      |   | 202,510 |          |          |   | (206,266 | )       |         |      | (101.9 | )      |      |   | 291,794 |         |         |   | 487,358 |         |         |   | (195,564 | )       |        |  | (40.1  | )    
|Discontinued operations                                                                                                                  |                                                                                  |                              | (95,337 | )        |                      |   | 38,793  |          |          |   | (134,130 | )       |         |      | (345.8 | )      |      |   |        |         |         |   |        |         |         |   |         |         |        |  |       |      
|                                                                                                                                         |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |        
|(Loss) income before cumulative effect of a change in accounting
    principle                                                           |                                                                                  |                              | (99,093 | )        |                      |   | 241,303 |          |          |   | (340,396 | )       |         |      | (141.1 | )      |      |   | 291,794 |         |         |   | 487,358 |         |         |   | (195,564 | )       |        |  | (40.1  | )    
|Cumulative effect of a change in accounting principle                                                                                    |                                                                                  |                              |        |          |                      |   | (33,697 | )        |          |   | 33,697   |         |         |      | (100.0 | )      |      |   |        |         |         |   | (33,697 | )       |         |   | 33,697   |         |        |  | (100.0 | )    
|                                                                                                                                         |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |        
|Net (loss) income                                                                                                                        |                                                                                  | $                            | (99,093 | )        |                      | $ | 207,606 |          |          | $ | (306,699 | )       |         |      | (147.7 | )%     |      | $ | 291,794 |         |         | $ | 453,661 |         |         | $ | (161,867 | )       |        |  | (35.7  | )%   
|                                                                                                                                         |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |        
|Selected Items from Continuing Operations:                                                                                               |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |         |         |   |          |         |        |  |        |      
|                                                                                                                                         | Property net operating income(c)                                                 |                              | $       | 981,865  |                      |   | $       | 948,123  |          |   | $        | 33,742  |         |      |        | 3.6    | %    |   | $       | 878,317 |         |   | $       | 899,469 |         |   | $        | (21,152 | )      |  |        | (2.4  | )%   
|                                                                                                                                         |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |        
|                                                                                                                                         | Deferred rental revenue                                                          |                              | $       | 32,578   |                      |   | $       | 42,770   |          |   | $        | (10,192 | )       |      |        | (23.8  | )%   |   | $       | 21,720  |         |   | $       | 39,489  |         |   | $        | (17,769 | )      |  |        | (45.0 | )%   
|                                                                                                                                         |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |        
|                                                                                                                                         | Lease termination fees                                                           |                              |         | 62,791   |                      |   | $       | 26,694   |          |   | $        | 36,097  |         |      |        | 135.2  | %    |   | $       | 14,097  |         |   | $       | 21,705  |         |   | $        | (7,608  | )      |  |        | (35.1 | )%   
|                                                                                                                                         |                                                                                  |                              |         |          |                      |   |         |          |          |   |          |         |         |      |        |        |      |   |         |         |         |   |         |        






|    |                                                                                                                                                                                             
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(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 Note 11 to the financial
    statements for more information.                                                                                                                                                                                                  



| |                            
| | ---------------------------
| | Property Operating Revenues





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







| |                  
| | -----------------
| | Real Estate Taxes







| |                            
| | ---------------------------
| | Property Operating Expenses







| |                                    
| | -----------------------------------
| | General and Administrative Expenses



41



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| |           
| | ----------
| | Impairment





| |                                                                                 
| | --------------------------------------------------------------------------------
| | Realized Gain on Settlement of Derivatives and Sale of
    Marketable Securities





| |                 
| | ----------------
| | Interest Expense





| |                                                         
| | --------------------------------------------------------
| | Income from Investments in Unconsolidated Joint Ventures





| |                        
| | -----------------------
| | Discontinued Operations





| |                                                      
| | -----------------------------------------------------
| | Cumulative Effect of a Change in Accounting Principle



Liquidity and Capital Resources




| |          
| | ---------
| | Liquidity



42



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43



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| |              
| | -------------
| | Distributions



|                         |  |              |          |  |              |                        |        |          |             |   |          |  |  |   |       | 
|------------------------ |  | ------------ | -------- |  | ------------ | ---------------------- | ------ | -------- | ----------- | - | -------- |  |  | - | ----- | 
|                         |  |              |          |  |              | Distributions          |       
|                         |  |              |          |  |              |                        |       
|                         |  |              |          |  |              | For the                |        |          |            
|                         |  |              |          |  |              | Three                  |        |          | For the Six |  
|                         |  |              |          |  |              | Months                 |        |          | Months      |  
|                         |  | Quarterly    |          |  | Annualized   |                        |        | Ended    |             |   | Ended    | 
|                         |  | Distribution |          |  | Distribution |                        |        | June 30, |             |   | June 30, | 
|Security                 |  | Per Unit     |          |  | Per Unit     |                        |        | 2005     |             |   | 2005     | 
|                         |  |              |          |  |              |                        |        |          |             |   |          | 
|                         |  |              |          |  |              | (Dollars in thousands) |       
|Series B Preferred Units |  | $            | 0.65625  |  |              | $                      | 2.625  |          |             | $ | 3,931    |  |  | $ | 7,862 | 
|Series G Preferred Units |  | $            | 0.484375 |  |              | $                      | 1.9375 |          |             | $ | 4,117    |  |  | $ | 8,234 | 





| |                        
| | -----------------------
| | Contractual Obligations



|                                                        |  |                        |            |              |      |   |         |      |  |   |           |  |  |      |           |  |      |   |         |            |  |   |           |  |  |   |           | 
|------------------------------------------------------- |  | ---------------------- | ---------- | ------------ | ---- | - | ------- | ---- |  | - | --------- |  |  | ---- | --------- |  | ---- | - | ------- | ---------- |  | - | --------- |  |  | - | --------- | 
|                                                        |  | Payments Due by Period |           
|                                                        |  |                        |           
|                                                        |  |                        |            | Remainder of |      |   |        
|(Dollars in thousands)                                  |  | Total                  |            |              | 2005 |   |         | 2006 |  |   | 2007      |  |  | 2008 |           |  | 2009 |   |         | Thereafter | 
|                                                        |  |                        |            |              |      |   |         |      |  |   |           |  |  |      |           |  |      |   |         |            | 
|Mortgage debt(a)                                        |  | $                      | 2,298,968  |              |      | $ | 652,078 |      |  | $ | 287,003   |  |  | $    | 261,635   |  |      | $ | 156,712 |            |  | $ | 563,319   |  |  | $ | 378,221   | 
|Unsecured notes(a)                                      |  |                        | 9,194,290  |              |      |   | 150,000 |      |  |   | 652,924   |  |  |      | 988,543   |  |      |   | 482,971 |            |  |   | 858,609   |  |  |   | 6,061,243 | 
|Lines of Credit(b)                                      |  |                        | 693,000    |              |      |   |        |      |  |   | 693,000   |  |  |      |          |  |      |   |        |            |  |   |          |  |  |   |          | 
|Series B Preferred Units                                |  |                        | 299,497    |              |      |   |        |      |  |   |          |  |  |      |          |  |      |   | 299,497 |            |  |   |          |  |  |   |          | 
|Share of mortgage debt of unconsolidated joint ventures |  |                        | 359,732    |              |      |   | 30,415  |      |  |   | 52,227    |  |  |      | 4,010     |  |      |   | 18,622  |            |  |   | 11,658    |  |  |   | 242,800   | 
|Operating lease obligations                             |  |                        | 1,304,791  |              |      |   | 10,887  |      |  |   | 21,631    |  |  |      | 21,471    |  |      |   | 21,582  |            |  |   | 21,638    |  |  |   | 1,207,582 | 
|Share of ground leases of unconsolidated joint ventures |  |                        | 34,136     |              |      |   | 282     |      |  |   | 564       |  |  |      | 564       |  |      |   | 564     |            |  |   | 564       |  |  |   | 31,598    | 
|                                                        |  |                        |            |              |      |   |         |      |  |   |           |  |  |      |           |  |      |   |         |            | 
|Total Contractual Obligations                           |  | $                      | 14,184,414 |              |      | $ | 843,662 |      |  | $ | 1,707,349 |  |  | $    | 1,276,223 |  |      | $ | 979,948 |            |  | $ | 1,455,788 |  |  | $ | 7,921,444 | 
|                                                        |  |                        |            |              |      |   |         |      |  |   |           |  |  |      |           |  |      |   |         |            | 

44



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|    |                                             
|--- | --------------------------------------------
|(a) | Balance excludes net discounts and premiums.



|    |  |                                                                                                                                                                                                                                                                       
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(b) |  | In August 2005, we entered into a new $1.25 billion line of
    credit that matures in August 2009. The new line of credit
    replaces the line of credit that was scheduled to mature in
    2006. See Note 13 to the financial statements for more
    information.



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





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





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





| |                      
| | ---------------------
| | Property Acquisitions





45



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Debt Financing




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



|                                           |                  |                                        |                          |       |              |            |            |      |           |            |            |  
|------------------------------------------ | ---------------- | -------------------------------------- | ------------------------ | ----- | ------------ | ---------- | ---------- | ---- | --------- | ---------- | ---------- | -
|                                           |                  | June 30,                               |                          |       | December 31, |           
|(Dollars in thousands)                     |                  | 2005                                   |                          |       | 2004         |           
|                                           |                  |                                        |                          |       |              |           
|Balance (includes discounts and premiums): |                  |                                        |                          |       |              |            |            |     
|                                           | Fixed rate:      |                                        |                          |       |              |            |            |      |          
|                                           |                  | Mortgage debt                          |                          | $     | 2,181,008    |            |            | $    | 2,502,871 |           
|                                           |                  | Unsecured notes                        |                          |       | 8,187,714    |            |            |      | 8,439,016 |           
|                                           |                  |                                        |                          |       |              |           
|                                           |                  |                                        | Total fixed rate debt    |       |              | 10,368,722 |            |      |           | 10,941,887 |           
|                                           |                  |                                        |                          |       |              |           
|                                           | Variable rate:   |                                        |                          |       |              |            |            |      |          
|                                           |                  | Mortgage debt                          |                          |       | 105,654      |            |            |      | 106,196   |           
|                                           |                  | Unsecured notes and lines of credit(a) |                          |       | 1,684,340    |            |            |      | 1,761,376 |           
|                                           |                  |                                        |                          |       |              |           
|                                           |                  |                                        | Total variable rate debt |       |              | 1,789,994  |            |      |           | 1,867,572  |           
|                                           |                  |                                        |                          |       |              |           
|                                           |                  |                                        |                          | Total |              | $          | 12,158,716 |      |           | $          | 12,809,459 |  
|                                           |                  |                                        |                          |       |              |           
|Percent of total debt:                     |                  |                                        |                          |       |              |            |            |     
|                                           | Fixed rate       |                                        |                          | 85.3  | %            |            |            | 85.4 | %        
|                                           | Variable rate(a) |                                        |                          | 14.7  | %            |            |            | 14.6 | %        
|                                           |                  |                                        |                          |       |              |           
|                                           |                  | Total                                  |                          |       | 100.0        | %          |            |      | 100.0     | %         
|                                           |                  |                                        |                          |       |              |           
|Effective interest rate at end of period:  |                  |                                        |                          |       |              |            |            |     
|                                           | Fixed rate:      |                                        |                          |       |              |            |            |      |          
|                                           |                  | Mortgage debt                          |                          |       | 7.62         | %          |            |      | 7.80      | %         
|                                           |                  | Unsecured notes                        |                          |       | 6.92         | %          |            |      | 6.87      | %         
|                                           |                  |                                        |                          |       |              |           
|                                           |                  |                                        | Effective interest rate  |       |              | 7.07       | %          |      |           | 7.09       | %         
|                                           |                  |                                        |                          |       |              |           
|                                           | Variable rate:   |                                        |                          |       |              |            |            |      |          
|                                           |                  | Mortgage debt                          |                          |       | 6.36         | %          |            |      | 5.53      | %         
|                                           |                  | Unsecured notes and lines of credit    |                          |       | 4.27         | %          |            |      | 3.75      | %         
|                                           |                  |                                        |                          |       |              |           
|                                           |                  |                                        | Effective interest rate  |       |              | 4.40       | %          |      |           | 3.85       | %         
|                                           |                  |                                        |                          |       |              |           
|                                           |                  |                                        |                          | Total |              |            | 6.68       | %    |           |            | 6.61       | %
|                                           |                  |                                        |                          |       |              |           






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                        
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | The variable rate debt as of June 30, 2005 and
    December 31, 2004 includes $750 million and
    $1.0 billion of fixed rate unsecured notes, respectively,
    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.

46



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##### Table of Contents





| |              
| | -------------
| | Mortgage Debt



|                                |                                                                                    |                        |           |         |          |  
|------------------------------- | ---------------------------------------------------------------------------------- | ---------------------- | --------- | ------- | -------- | -
|                                |                                                                                    | (Dollars in thousands) |          
|                                |                                                                                    |                        |          
|Balance at December 31, 2004(a) |                                                                                    | $                      | 2,622,750 |        
|                                | Scheduled principal amortization prior to maturity                                 |                        |           | (9,963  | )       
|                                | Repayment of debt encumbering the following properties:                            |                        |           |         |         
|                                | Sixty State Street                                                                 |                        |           | (71,962 | )       
|                                | Island Corporate Center                                                            |                        |           | (12,312 | )       
|                                | San Mateo BayCenter II                                                             |                        |           | (9,520  | )       
|                                | Repaid upon sale of property (see Note 4 to the financial
    statements)          |                        |           | (13,386 | )       
|                                |                                                                                    |                        |          
|Balance at March 31, 2005(a)    |                                                                                    |                        | 2,505,607 |        
|                                | Scheduled principal amortization prior to maturity                                 |                        |           | (9,361  | )       
|                                | Repayment of debt encumbering the following properties:                            |                        |           |         |         
|                                |                                                                                    | 1740 Technology        |           |         | (15,684  | )
|                                |                                                                                    | One Market             |           |         | (171,689 | )
|                                |                                                                                    | Central Park           |           |         | (55,030  | )
|                                | Assumed through property acquisitions (see Note 3 to the
    financial statements) |                        |           | 44,975  |         
|                                | Washington Mutual Tower refinancing(b)                                             |                        |           | 150     |         
|                                |                                                                                    |                        |          
|Balance at June 30, 2005(a)     |                                                                                    | $                      | 2,298,968 |        
|                                |                                                                                    |                        |          






|    |                                         
|--- | ----------------------------------------
|(a) | Excludes net discounts on mortgage debt.



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(b) |  | We refinanced the mortgage debt encumbering the Washington
    Mutual Tower office property. The new mortgage has a principal
    balance of approximately $79.25 million, bears interest at
    a fixed coupon rate of 4.55% and matures in June 2010. The prior
    mortgage had a principal balance of approximately
    $79.1 million, bore interest at a fixed coupon rate of
    7.53% and was scheduled to mature in November 2005. The
    effective interest rate on the new debt is 4.56% as compared to
    7.77% on the prior mortgage.





| |                
| | ---------------
| | Lines of Credit



| |                                       
| | --------------------------------------
| | $1.0 Billion Revolving Credit Facility





47



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##### Table of Contents







| |                   
| | ------------------
| | Term Loan Facility





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



48



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##### Table of Contents





|                        |                                                        |              |      |      |           |                        |      |           |   |   |               |           |           |   |                  |  |  | 
|----------------------- | ------------------------------------------------------ | ------------ | ---- | ---- | --------- | ---------------------- | ---- | --------- | - | - | ------------- | --------- | --------- | - | ---------------- |  |  | 
|                        |                                                        | Coupon       |      |      | Effective |                        |      | Principal |   |   |              
|Original Term           |                                                        | Rate         |      |      | Rate(a)   |                        |      | Balance   |   |   | Maturity Date |          
|                        |                                                        |              |      |      |           |                        |      |           |   |   |               |          
|                        |                                                        |              |      |      |           | (Dollars in thousands) |      |           |  
|Fixed interest rate:    |                                                        |              |      |      |           |                        |      |           |   |   |               |           |           |   |                  | 
|7 Years                 |                                                        |              | 8.00 | %    |           |                        | 6.49 | %         |   | $ | 100,000       |           |           |   | 7/19/05          | 
|8 Years                 |                                                        |              | 7.36 | %    |           |                        | 7.69 | %         |   |   | 50,000        |           |           |   | 9/01/05          | 
|6 Years                 |                                                        |              | 8.38 | %    |           |                        | 7.65 | %         |   |   | 500,000       |           |           |   | 3/15/06          | 
|9 Years                 |                                                        |              | 7.44 | %    |           |                        | 7.74 | %         |   |   | 50,000        |           |           |   | 9/01/06          | 
|10 Years                |                                                        |              | 7.13 | %    |           |                        | 6.74 | %         |   |   | 100,000       |           |           |   | 12/01/06         | 
|9 Years                 |                                                        |              | 7.00 | %    |           |                        | 6.80 | %         |   |   | 1,500         |           |           |   | 2/02/07          | 
|9 Years                 |                                                        |              | 6.88 | %    |           |                        | 6.83 | %         |   |   | 25,000        |           |           |   | 4/30/07          | 
|9 Years                 |                                                        |              | 6.76 | %    |           |                        | 6.76 | %         |   |   | 300,000       |           |           |   | 6/15/07          | 
|10 Years                |                                                        |              | 7.41 | %    |           |                        | 7.70 | %         |   |   | 50,000        |           |           |   | 9/01/07          | 
|7 Years                 |                                                        |              | 7.75 | %    |           |                        | 7.91 | %         |   |   | 600,000       |           |           |   | 11/15/07         | 
|10 Years                |                                                        |              | 6.75 | %    |           |                        | 6.97 | %         |   |   | 150,000       |           |           |   | 1/15/08          | 
|10 Years                |                                                        |              | 6.75 | %    |           |                        | 7.01 | %         |   |   | 300,000       |           |           |   | 2/15/08          | 
|10 Years                |                                                        |              | 6.80 | %    |           |                        | 6.94 | %         |   |   | 500,000       |           |           |   | 1/15/09          | 
|10 Years                |                                                        |              | 7.25 | %    |           |                        | 7.14 | %         |   |   | 200,000       |           |           |   | 5/01/09          | 
|11 Years                |                                                        |              | 7.13 | %    |           |                        | 6.97 | %         |   |   | 150,000       |           |           |   | 7/01/09          | 
|10 Years                |                                                        |              | 8.10 | %    |           |                        | 8.22 | %         |   |   | 360,000       |           |           |   | 8/01/10          | 
|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     |           |           |   | 7/15/11          | 
|10 Years                |                                                        |              | 6.75 | %    |           |                        | 7.02 | %         |   |   | 500,000       |           |           |   | 2/15/12          | 
|10 Years                |                                                        |              | 5.88 | %    |           |                        | 5.98 | %         |   |   | 500,000       |           |           |   | 1/15/13          | 
|10 Years(b)             |                                                        |              | 4.75 | %    |           |                        | 5.54 | %         |   |   | 250,000       |           |           |   | 3/15/14          | 
|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       |           |           |   | 2/15/18          | 
|30 Years                |                                                        |              | 7.50 | %    |           |                        | 8.24 | %         |   |   | 150,000       |           |           |   | 10/01/27         | 
|30 Years                |                                                        |              | 7.25 | %    |           |                        | 7.31 | %         |   |   | 225,000       |           |           |   | 6/15/28          | 
|30 Years                |                                                        |              | 7.50 | %    |           |                        | 7.55 | %         |   |   | 200,000       |           |           |   | 4/19/29          | 
|30 Years                |                                                        |              | 7.88 | %    |           |                        | 7.94 | %         |   |   | 300,000       |           |           |   | 7/15/31          | 
|EOP InterNotes(c)       |                                                        |              | 4.25 | %    |           |                        | 4.51 | %         |   |   | 62,790        |           |           |   | 11/15/06-6/15/11 | 
|                        |                                                        |              |      |      |           |                        |      |           |   |   |               |          
|                        | Total/ Weighted Average Unsecured Fixed Rate
    Notes |              |      | 6.87 | %         |                        |      | 6.92      | % |   |               | 8,199,290 |           |   |                  |  | 
|                        |                                                        |              |      |      |           |                        |      |           |   |   |               |          
|Variable interest rate: |                                                        |              |      |      |           |                        |      |           |   |   |               |           |           |   |                  | 
|6 Years                 |                                                        |              | 3.70 | %    |           |                        | 3.83 | %         |   |   | 200,000       |           |           |   | 10/01/10         | 
|10 Years(d)             |                                                        |              | 4.75 | %    |           |                        | 4.70 | %         |   |   | 750,000       |           |           |   | 3/15/14          | 
|10 Years                |                                                        |              | 4.09 | %    |           |                        | 4.19 | %         |   |   | 45,000        |           |           |   | 5/27/14          | 
|                        |                                                        |              |      |      |           |                        |      |           |   |   |               |          
|                        | Total/ Weighted Average Unsecured Variable Rate Notes  |              |      | 4.51 | %         |                        |      | 4.50      | % |   |               | 995,000   |           |   |                  |  | 
|                        |                                                        |              |      |      |           |                        |      |           |   |   |               |          
|                        | Total/ Weighted Average                                |              |      | 6.62 | %         |                        |      | 6.66      | % |   |               | 9,194,290 |           |   |                  |  | 
|                        |                                                        |              |      |      |           |                        |      |           |   |   |               |          
|                        |                                                        | Net discount |      |      |           |                        |      |           |   |   |               |           | (15,236   | ) |                  |  |  | 
|                        |                                                        |              |      |      |           |                        |      |           |   |   |               |          
|                        |                                                        | Total        |      |      |           |                        |      |           |   |   |               | $         | 9,179,054 |   |                  |  |  | 
|                        |                                                        |              |      |      |           |                        |      |           |   |   |               |          






|    |  |                                                                                                                                                                                                                          
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(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) |  | In March 2004, we entered into an interest rate swap agreement
    with a notional amount of $250 million that effectively
    converted these notes to a variable interest rate based on the
    6-month LIBOR rate. The

49



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| |                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------
| | interest rate swap was terminated during June 2005 at no cost,
    which effectively converted these notes back to a fixed interest
    rate.



|    |  |                                                                                                                                                                                                                                   
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(c) |  | 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%.   
|   
|(d) |  | In March 2004, we entered into three interest rate swap
    agreements with a combined notional amount of $750 million
    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%                                            |  |                    | 10  | %
|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)                                 |  |                    | 207 | %






|    |  |                                                                                                                                                                                                       
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The unsecured notes we assumed in the merger with Spieker
    Partnership, of which approximately $1.3 billion are still
    outstanding at June 30, 2005, are subject to a minimum
    ratio of 165%.

50



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##### Table of Contents





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



|                                 |                                                                                                   |               |             |           |       |  |            |            |   |  |             |            |  
|-------------------------------- | ------------------------------------------------------------------------------------------------- | ------------- | ----------- | --------- | ----- |  | ---------- | ---------- | - |  | ----------- | ---------- | -
|                                 |                                                                                                   | Common Shares |             |           | Units |  |            | Total      |  
|                                 |                                                                                                   |               |             |           |       |  |            |            |  
|Outstanding at December 31, 2004 |                                                                                                   |               | 403,842,441 |           |       |  | 47,494,701 |            |   |  | 451,337,142 |           
|                                 | Issued upon exercise of share options                                                             |               |             | 1,618,882 |       |  |            |           |   |  |             | 1,618,882  |  
|                                 | Repurchased and retired(a)                                                                        |               |             | (86,505   | )     |  |            |           |   |  |             | (86,505    | )
|                                 | Repurchased in the prior period, but retired in the current
    period                            |               |             | (25,728   | )     |  |            |           |   |  |             | (25,728    | )
|                                 | Units redeemed for Common Shares                                                                  |               |             | 446,459   |       |  |            | (446,459   | ) |  |             |           |  
|                                 | Units converted to cash                                                                           |               |             |          |       |  |            | (203,396   | ) |  |             | (203,396   | )
|                                 | Restricted shares issued, net of cancellations                                                    |               |             | 819,515   |       |  |            |           |   |  |             | 819,515    |  
|                                 | Issued upon conversion of 70 Series B Preferred Shares                                            |               |             | 98        |       |  |            |           |   |  |             | 98         |  
|                                 |                                                                                                   |               |             |           |       |  |            |            |  
|Outstanding at March 31, 2005    |                                                                                                   |               | 406,615,162 |           |       |  | 46,844,846 |            |   |  | 453,460,008 |           
|                                 | Issued upon exercise of share options                                                             |               |             | 2,904,887 |       |  |            |           |   |  |             | 2,904,887  |  
|                                 | Repurchased and retired                                                                           |               |             | (158,771  | )     |  |            |           |   |  |             | (158,771   | )
|                                 | Repurchased in the prior period, but retired in the current
    period                            |               |             | (4,000    | )     |  |            |           |   |  |             | (4,000     | )
|                                 | Units redeemed for Common Shares                                                                  |               |             | 717,066   |       |  |            | (717,066   | ) |  |             |           |  
|                                 | Units converted to cash                                                                           |               |             |          |       |  |            | (1,453,702 | ) |  |             | (1,453,702 | )
|                                 | Restricted shares issued, net of cancellations                                                    |               |             | (37,948   | )     |  |            |           |   |  |             | (37,948    | )
|                                 | Units issued in connection with property acquisition (see
    Note 3 to the financial statements) |               |             |          |       |  |            | 108,190    |   |  |             | 108,190    |  
|                                 | Common Shares issued for Board of Trustees fees                                                   |               |             | 4,687     |       |  |            |           |   |  |             | 4,687      |  
|                                 |                                                                                                   |               |             |           |       |  |            |            |  
|Outstanding at June 30, 2005     |                                                                                                   |               | 410,041,083 |           |       |  | 44,782,268 |            |   |  | 454,823,351 |           
|                                 |                                                                                                   |               |             |           |       |  |            |            |  






|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | During the three months ended March 31, 2005, 90,505 Equity
    Office common shares of beneficial interest (Common
    Shares) were repurchased at an average purchase price of
    $30.15 for approximately $2.7 million. Of these 90,505
    Common Shares, 4,000 were not yet retired as of March 31,
    2005. In connection with these repurchases, we retired a
    corresponding number of Units for an aggregate purchase price
    equal to the aggregate purchase price for all Common Share
    repurchases.

Market Risk




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 costs, capitalized
    interest and operating costs                                                       

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| |  |                                                                                                                   
| |  | ------------------------------------------------------------------------------------------------------------------
| |  | incurred during completion of the property and incurred while
    the property is made ready for its intended use.



|                       |                      |                                     |   |                |             |  |   |              |                |  |             |        |        |  |   |       |       | 
|---------------------- | -------------------- | ----------------------------------- | - | -------------- | ----------- |  | - | ------------ | -------------- |  | ----------- | ------ | ------ |  | - | ----- | ----- | 
|                       |                      | For the three months ended June 30, |  
|                       |                      |                                     |  
|                       |                      | 2005                                |   |                | 2004        | 
|                       |                      |                                     |   |                |             | 
|                       |                      |                                     |   | Unconsolidated |             |  |   |              | Unconsolidated | 
|                       |                      | Consolidated                        |   |                | Properties  |  |   | Consolidated |                |  | Properties  |       
|(Dollars in thousands) |                      | Properties                          |   |                | (our share) |  |   | Properties   |                |  | (our share) |       
|                       |                      |                                     |   |                |             |  |   |              |                |  |             |       
|Capital Improvements:  |                      |                                     |   |                |             |  |   |              |                |  |             |        |        |  |   |      
|                       | Capital improvements |                                     | $ | 11,402         |             |  | $ | 1,285        |                |  | $           | 16,217 |        |  | $ | 1,188 |      
|                       | Development costs    |                                     |   | 3,610          |             |  |   |             |                |  |             | 22,598 |        |  |   |      |      
|                       |                      |                                     |   |                |             |  |   |              |                |  |             |       
|                       |                      | Total capital improvements          |   | $              | 15,012      |  |   | $            | 1,285          |  |             | $      | 38,815 |  |   | $     | 1,188 | 
|                       |                      |                                     |   |                |             |  |   |              |                |  |             |       

|                       |                      |                                   |   |                |             |  |   |              |                |  |             |        |        |  |   |       |       | 
|---------------------- | -------------------- | --------------------------------- | - | -------------- | ----------- |  | - | ------------ | -------------- |  | ----------- | ------ | ------ |  | - | ----- | ----- | 
|                       |                      | For the six months ended June 30, |  
|                       |                      |                                   |  
|                       |                      | 2005                              |   |                | 2004        | 
|                       |                      |                                   |   |                |             | 
|                       |                      |                                   |   | Unconsolidated |             |  |   |              | Unconsolidated | 
|                       |                      | Consolidated                      |   |                | Properties  |  |   | Consolidated |                |  | Properties  |       
|(Dollars in thousands) |                      | Properties                        |   |                | (our share) |  |   | Properties   |                |  | (our share) |       
|                       |                      |                                   |   |                |             |  |   |              |                |  |             |       
|Capital Improvements:  |                      |                                   |   |                |             |  |   |              |                |  |             |        |        |  |   |      
|                       | Capital improvements |                                   | $ | 15,965         |             |  | $ | 2,087        |                |  | $           | 21,489 |        |  | $ | 1,777 |      
|                       | Development costs    |                                   |   | 4,695          |             |  |   |             |                |  |             | 42,725 |        |  |   |      |      
|                       | Redevelopment costs  |                                   |   |               |             |  |   |             |                |  |             | 356    |        |  |   |      |      
|                       |                      |                                   |   |                |             |  |   |              |                |  |             |       
|                       |                      | Total capital improvements        |   | $              | 20,660      |  |   | $            | 2,087          |  |             | $      | 64,570 |  |   | $     | 1,777 | 
|                       |                      |                                   |   |                |             |  |   |              |                |  |             |       



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





|                               |            |                                     |   |                |                    |     |   |             |                |  |                    |        |        |     |   |       |       | 
|------------------------------ | ---------- | ----------------------------------- | - | -------------- | ------------------ | --- | - | ----------- | -------------- |  | ------------------ | ------ | ------ | --- | - | ----- | ----- | 
|                               |            | For the three months ended June 30, |  
|                               |            |                                     |  
|                               |            | 2005                                |   |                | 2004               |    
|                               |            |                                     |   |                |                    |    
|                               |            |                                     |   | Total Cost Per |                    |     |   |             | Total Cost per | 
|(Dollars in thousands)         |            | Total Costs                         |   |                | Square Foot Leased |     |   | Total Costs |                |  | Square Foot Leased |       
|                               |            |                                     |   |                |                    |     |   |             |                |  |                    |       
|Consolidated Properties:       |            |                                     |   |                |                    |     |   |             |                |  |                    |        |        |     |   |      
|Office Properties:             |            |                                     |   |                |                    |     |   |             |                |  |                    |        |        |     |   |      
|                               | Renewals   |                                     | $ | 38,512         |                    |     | $ | 19.70       |                |  | $                  | 29,272 |        |     | $ | 10.09 |      
|                               | Retenanted |                                     |   | 51,470         |                    |     |   | 22.35       |                |  |                    | 63,128 |        |     |   | 23.14 |      
|                               |            |                                     |   |                |                    |     |   |             |                |  |                    |       
|                               |            | Total/ Weighted Average             |   |                | 89,982             |     |   |             | 21.13          |  |                    |        | 92,400 |     |   |       | 16.41 | 
|                               |            |                                     |   |                |                    |     |   |             |                |  |                    |       
|Unconsolidated Joint Ventures: |            |                                     |   |                |                    |     |   |             |                |  |                    |        |        |     |   |      
|                               | Renewals   |                                     |   | 517            | (a)                |     |   | 12.41       |                |  |                    | 1,479  | (a)    |     |   | 11.95 |      
|                               | Retenanted |                                     |   | 5,895          | (a)                |     |   | 41.20       |                |  |                    | 2,910  | (a)    |     |   | 27.33 |      
|                               |            |                                     |   |                |                    |     |   |             |                |  |                    |       
|                               |            | Total/ Weighted Average             |   |                | 6,412              | (a) |   |             | 34.71          |  |                    |        | 4,389  | (a) |   |       | 19.06 | 
|                               |            |                                     |   |                |                    |     |   |             |                |  |                    |       
|                               |            | Total/ Weighted Average             |   | $              | 96,394             |     |   | $           | 21.70          |  |                    | $      | 96,789 |     |   | $     | 16.52 | 
|                               |            |                                     |   |                |                    |     |   |             |                |  |                    |       

52



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|                               |            |                                   |   |                |                    |     |   |             |                |  |                    |         |         |     |   |       |       | 
|------------------------------ | ---------- | --------------------------------- | - | -------------- | ------------------ | --- | - | ----------- | -------------- |  | ------------------ | ------- | ------- | --- | - | ----- | ----- | 
|                               |            | For the six months ended June 30, |  
|                               |            |                                   |  
|                               |            | 2005                              |   |                | 2004               |    
|                               |            |                                   |   |                |                    |    
|                               |            |                                   |   | Total Cost Per |                    |     |   |             | Total Cost per | 
|(Dollars in thousands)         |            | Total Costs                       |   |                | Square Foot Leased |     |   | Total Costs |                |  | Square Foot Leased |        
|                               |            |                                   |   |                |                    |     |   |             |                |  |                    |        
|Consolidated Properties:       |            |                                   |   |                |                    |     |   |             |                |  |                    |         |         |     |   |      
|Office Properties:             |            |                                   |   |                |                    |     |   |             |                |  |                    |         |         |     |   |      
|                               | Renewals   |                                   | $ | 69,830         |                    |     | $ | 14.47       |                |  | $                  | 46,223  |         |     | $ | 9.64  |      
|                               | Retenanted |                                   |   | 105,785        |                    |     |   | 22.07       |                |  |                    | 118,906 |         |     |   | 22.51 |      
|                               |            |                                   |   |                |                    |     |   |             |                |  |                    |        
|                               |            | Total/ Weighted Average           |   |                | 175,615            |     |   |             | 18.26          |  |                    |         | 165,129 |     |   |       | 16.39 | 
|                               |            |                                   |   |                |                    |     |   |             |                |  |                    |        
|Unconsolidated Joint Ventures: |            |                                   |   |                |                    |     |   |             |                |  |                    |         |         |     |   |      
|                               | Renewals   |                                   |   | 1,126          | (a)                |     |   | 10.18       |                |  |                    | 8,698   | (a)     |     |   | 20.59 |      
|                               | Retenanted |                                   |   | 16,095         | (a)                |     |   | 41.87       |                |  |                    | 6,506   | (a)     |     |   | 27.58 |      
|                               |            |                                   |   |                |                    |     |   |             |                |  |                    |        
|                               |            | Total/ Weighted Average           |   |                | 17,221             | (a) |   |             | 34.79          |  |                    |         | 15,204  | (a) |   |       | 23.09 | 
|                               |            |                                   |   |                |                    |     |   |             |                |  |                    |        
|                               |            | Total/ Weighted Average           |   | $              | 192,836            |     |   | $           | 19.07          |  |                    | $       | 180,333 |     |   | $     | 16.80 | 
|                               |            |                                   |   |                |                    |     |   |             |                |  |                    |        






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



|                                                                                                             |                                                                   |                            |        |         |         |   |        |         |         | 
|------------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------- | -------------------------- | ------ | ------- | ------- | - | ------ | ------- | ------- | 
|                                                                                                             |                                                                   | For the three months ended |       
|                                                                                                             |                                                                   | June 30,                   |       
|                                                                                                             |                                                                   |                            |       
|(Dollars in thousands)                                                                                       |                                                                   | 2005                       |        |         | 2004    |  
|                                                                                                             |                                                                   |                            |        |         |         |  
|Capital improvements                                                                                         |                                                                   | $                          | 11,402 |         |         | $ | 16,217 |        
|Tenant improvements and leasing costs:                                                                       |                                                                   |                            |        |         |         |   |        |        
|                                                                                                             | Office properties                                                 |                            |        | 89,982  |         |   |        | 92,400  |        
|                                                                                                             | Industrial properties                                             |                            |        |        |         |   |        | 749     |        
|Expenditures for corporate furniture, fixtures and equipment,
    software, leasehold improvements and other |                                                                   |                            | 5,047  |         |         |   | 273    |        
|                                                                                                             |                                                                   |                            |        |         |         |  
|                                                                                                             | Subtotal                                                          |                            |        | 106,431 |         |   |        | 109,639 |        
|Development costs                                                                                            |                                                                   |                            | 3,610  |         |         |   | 22,598 |        
|Redevelopment costs                                                                                          |                                                                   |                            |       |         |         |   |       |        
|Timing differences                                                                                           |                                                                   |                            | (6,103 | )       |         |   | 18,974 |        
|                                                                                                             |                                                                   |                            |        |         |         |  
|                                                                                                             | Total capital improvements, tenant improvements and leasing costs |                            | $      | 103,938 |         |   | $      | 151,211 |        
|                                                                                                             |                                                                   |                            |        |         |         |  
|Selected items from the consolidated statements of cash
    flows:                                           |                                                                   |                            |        |         |         |   |        |        
|                                                                                                             | Capital and tenant improvements                                   |                            | $      | 74,557  |         |   | $      | 122,160 |        
|                                                                                                             | Lease commissions and other costs                                 |                            |        | 29,381  |         |   |        | 29,051  |        
|                                                                                                             |                                                                   |                            |        |         |         |  
|                                                                                                             |                                                                   | Total                      |        | $       | 103,938 |   |        | $       | 151,211 | 
|                                                                                                             |                                                                   |                            |        |         |         |  

53



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|                                                                                                             |                                                                   |                          |        |         |         |   |        |         |         | 
|------------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------- | ------------------------ | ------ | ------- | ------- | - | ------ | ------- | ------- | 
|                                                                                                             |                                                                   | For the six months ended |       
|                                                                                                             |                                                                   | June 30,                 |       
|                                                                                                             |                                                                   |                          |       
|(Dollars in thousands)                                                                                       |                                                                   | 2005                     |        |         | 2004    |  
|                                                                                                             |                                                                   |                          |        |         |         |  
|Capital improvements                                                                                         |                                                                   | $                        | 15,965 |         |         | $ | 21,489 |        
|Tenant improvements and leasing costs:                                                                       |                                                                   |                          |        |         |         |   |        |        
|                                                                                                             | Office properties                                                 |                          |        | 175,615 |         |   |        | 165,129 |        
|                                                                                                             | Industrial properties                                             |                          |        |        |         |   |        | 2,938   |        
|Expenditures for corporate furniture, fixtures and equipment,
    software, leasehold improvements and other |                                                                   |                          | 7,983  |         |         |   | 5,552  |        
|                                                                                                             |                                                                   |                          |        |         |         |  
|                                                                                                             | Subtotal                                                          |                          |        | 199,563 |         |   |        | 195,108 |        
|Development costs                                                                                            |                                                                   |                          | 4,695  |         |         |   | 42,725 |        
|Redevelopment costs                                                                                          |                                                                   |                          |       |         |         |   | 356    |        
|Timing differences                                                                                           |                                                                   |                          | 455    |         |         |   | 66,235 |        
|                                                                                                             |                                                                   |                          |        |         |         |  
|                                                                                                             | Total capital improvements, tenant improvements and leasing costs |                          | $      | 204,713 |         |   | $      | 304,424 |        
|                                                                                                             |                                                                   |                          |        |         |         |  
|Selected items from the consolidated statements of cash
    flows:                                           |                                                                   |                          |        |         |         |   |        |        
|                                                                                                             | Capital and tenant improvements                                   |                          | $      | 150,963 |         |   | $      | 243,549 |        
|                                                                                                             | Lease commissions and other costs                                 |                          |        | 53,750  |         |   |        | 60,875  |        
|                                                                                                             |                                                                   |                          |        |         |         |  
|                                                                                                             |                                                                   | Total                    |        | $       | 204,713 |   |        | $       | 304,424 | 
|                                                                                                             |                                                                   |                          |        |         |         |  

Developments




|                           |  |           |         |  |          |  |               |           |  |        |       |  |          |         |        |           |          |   |            |        |  |   |        |  |  |  |    | 
|-------------------------- |  | --------- | ------- |  | -------- |  | ------------- | --------- |  | ------ | ----- |  | -------- | ------- | ------ | --------- | -------- | - | ---------- | ------ |  | - | ------ |  |  |  | -- | 
|                           |  | Placed in |         |  |          |  |               |           |  |        | Costs |  |          | Total   |        |           | Current  |  
|                           |  | Service   |         |  |          |  | Number of     |           |  | Square |       |  | Incurred |         |        | Estimated |          |   | Percentage |       
|(Dollars in thousands)     |  | Date(a)   |         |  | Location |  |               | Buildings |  |        | Feet  |  |          | To Date |        |           | Costs(b) |   |            | Leased | 
|                           |  |           |         |  |          |  |               |           |  |        |       |  |          |         |        |           |          |   |            |        | 
|Summit at Douglas Ridge II |  |           | Q2 2005 |  |          |  | Roseville, CA |           |  |        | 1     |  |          |         | 93,349 |           |          | $ | 18,780     |        |  | $ | 22,995 |  |  |  | 7% | 






|    |  |                                                                                                                                                                                                                                                                                                                         
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The Placed in Service Date represents the date the certificate
    of occupancy was obtained. The property is currently in 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.





Inflation




54



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Cash Flows




|                                                         |                                                      |                            |         |          |                          |   |        |          |   |   |         |          |   |   |        |          |  
|-------------------------------------------------------- | ---------------------------------------------------- | -------------------------- | ------- | -------- | ------------------------ | - | ------ | -------- | - | - | ------- | -------- | - | - | ------ | -------- | -
|                                                         |                                                      | For the three months ended |         |          | For the six months ended |  
|                                                         |                                                      | June 30,                   |         |          | June 30,                 |  
|                                                         |                                                      |                            |         |          |                          |  
|(Dollars in thousands)                                   |                                                      | 2005                       |         |          | 2004                     |   |        | 2005     |   |   | 2004    |         
|                                                         |                                                      |                            |         |          |                          |   |        |          |   |   |         |         
|Cash and cash equivalents at the beginning of the period |                                                      | $                          | 102,298 |          |                          | $ | 56,534 |          |   | $ | 107,126 |          |   | $ | 69,398 |         
|                                                         | Net cash provided by operating activities            |                            |         | 299,153  |                          |   |        | 343,008  |   |   |         | 468,328  |   |   |        | 566,731  |  
|                                                         | Net cash provided by (used for) investing activities |                            |         | 836,650  |                          |   |        | 22,509   |   |   |         | 935,210  |   |   |        | (143,225 | )
|                                                         | Net cash (used for) financing activities             |                            |         | (622,104 | )                        |   |        | (347,234 | ) |   |         | (894,667 | ) |   |        | (418,087 | )
|                                                         |                                                      |                            |         |          |                          |   |        |          |   |   |         |         
|Cash and cash equivalents at the end of the period       |                                                      | $                          | 615,997 |          |                          | $ | 74,817 |          |   | $ | 615,997 |          |   | $ | 74,817 |         
|                                                         |                                                      |                            |         |          |                          |   |        |          |   |   |         |         



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





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





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



Additional Items for 2005




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





| |                      
| | ---------------------
| | Distributions Payable



55



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Critical Accounting Policies and Estimates




Subsequent Events




Funds From Operations (FFO)






|                                                                                                                                                                                                                                                                |  |                                     |          |              |         |   |       |         |              |   |         |   |  |   |       |  
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------------- | -------- | ------------ | ------- | - | ----- | ------- | ------------ | - | ------- | - |  | - | ----- | -
|                                                                                                                                                                                                                                                                |  | For the three months ended June 30, |         
|                                                                                                                                                                                                                                                                |  |                                     |         
|                                                                                                                                                                                                                                                                |  | 2005                                |          |              | 2004    |  
|                                                                                                                                                                                                                                                                |  |                                     |          |              |         |  
|                                                                                                                                                                                                                                                                |  |                                     |          | Per Weighted |         |   |       |         | Per Weighted |  
|                                                                                                                                                                                                                                                                |  |                                     |          | Average      |         |   |       |         | Average      |  
|(Dollars in thousands, except per unit amounts)                                                                                                                                                                                                                 |  | Dollars                             |          |              | Unit(b) |   |       | Dollars |              |   | Unit(b) |  
|                                                                                                                                                                                                                                                                |  |                                     |          |              |         |   |       |         |              |   |         |  
|Reconciliation of net (loss) income to FFO(a):                                                                                                                                                                                                                  |  |                                     |          |              |         |   |       |         |              |   |         |   |  |   |       |  
|Net (loss) income                                                                                                                                                                                                                                               |  | $                                   | (220,418 | )            |         | $ | (0.49 | )       |              | $ | 121,618 |   |  | $ | 0.27  |  
|Plus real estate related depreciation and amortization less gain
    and losses 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 |  |                                     | 131,110  |              |         |   | 0.29  |         |              |   | 192,325 |   |  |   | 0.43  |  
|                                                                                                                                                                                                                                                                |  |                                     |          |              |         |   |       |         |              |   |         |  
|FFO                                                                                                                                                                                                                                                             |  |                                     | (89,308  | )            |         |   | (0.20 | )       |              |   | 313,943 |   |  |   | 0.70  |  
|Preferred distributions                                                                                                                                                                                                                                         |  |                                     | (8,701   | )            |         |   | (0.02 | )       |              |   | (8,944  | ) |  |   | (0.02 | )
|                                                                                                                                                                                                                                                                |  |                                     |          |              |         |   |       |         |              |   |         |  
|FFO available to unitholders  basic                                                                                                                                                                                                                            |  | $                                   | (98,009  | )            |         | $ | (0.22 | )(d)    |              | $ | 304,999 |   |  | $ | 0.68  |  
|                                                                                                                                                                                                                                                                |  |                                     |          |              |         |   |       |         |              |   |         |  

|                                                                                                            |  |            |             |   |     |   |             |            |  |   |             |   |  |   |             |  
|----------------------------------------------------------------------------------------------------------- |  | ---------- | ----------- | - | --- | - | ----------- | ---------- |  | - | ----------- | - |  | - | ----------- | -
|Adjustments to arrive at FFO available to                                                                   |  | Net Income |             |   | FFO |   |             | Net Income |  |   | FFO         |  
|unitholders plus assumed conversions:                                                                       |  |            |             |   |     |   |             |            |  |   |             |  
|Net (loss) income and FFO                                                                                   |  | $          | (220,418    | ) |     | $ | (89,308     | )          |  | $ | 121,618     |   |  | $ | 313,943     |  
|Preferred distributions                                                                                     |  |            | (8,701      | ) |     |   | (8,701      | )          |  |   | (8,944      | ) |  |   | (8,944      | )
|                                                                                                            |  |            |             |   |     |   |             |            |  |   |             |  
|Net (loss) income and FFO available to unitholders                                                          |  |            | (229,119    | ) |     |   | (98,009     | )          |  |   | 112,674     |   |  |   | 304,999     |  
|Preferred distributions on Series B preferred units, of
    which are assumed to be converted into Units(c) |  |            |            |   |     |   |            |            |  |   |            |   |  |   | 5,236       |  
|                                                                                                            |  |            |             |   |     |   |             |            |  |   |             |  
|Net (loss) income and FFO available to unitholders plus assumed
    conversions                             |  | $          | (229,119    | ) |     | $ | (98,009     | )          |  | $ | 112,674     |   |  | $ | 310,235     |  
|                                                                                                            |  |            |             |   |     |   |             |            |  |   |             |  
|Weighted average Units, dilutive potential units plus assumed
    conversions outstanding                   |  |            | 451,728,242 |   |     |   | 451,728,242 |            |  |   | 450,533,841 |   |  |   | 458,923,195 |  
|                                                                                                            |  |            |             |   |     |   |             |            |  |   |             |  
|Net (loss) income and FFO available to unitholders plus assumed
    conversions per unit                    |  | $          | (0.51       | ) |     | $ | (0.22       | )(d)       |  | $ | 0.25        |   |  | $ | 0.68        |  
|                                                                                                            |  |            |             |   |     |   |             |            |  |   |             |  

56



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|                                                                                                                                                                    |  |  |  |                            |  |  |             |  |  |  |  |  |  |  |             | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  |  | -------------------------- |  |  | ----------- |  |  |  |  |  |  |  | ----------- | 
|                                                                                                                                                                    |  |  |  | Units and unit equivalents | 
|                                                                                                                                                                    |  |  |  |                            | 
|Weighted average Units outstanding (used for both net (loss)
    income and FFO basic per unit calculation)                                                         |  |  |  |                            |  |  | 451,728,242 |  |  |  |  |  |  |  | 449,245,505 | 
|Impact of share options and restricted shares which are dilutive
    to both net income and FFO                                                                     |  |  |  |                            |  |  |            |  |  |  |  |  |  |  | 1,288,336   | 
|                                                                                                                                                                    |  |  |  |                            |  |  |             |  |  |  |  | 
|Weighted average Units and dilutive potential units used for net
    (loss) income available to unitholders                                                         |  |  |  |                            |  |  | 451,728,242 |  |  |  |  |  |  |  | 450,533,841 | 
|Impact of conversion of Series B preferred units(c)                                                                                                                 |  |  |  |                            |  |  |            |  |  |  |  |  |  |  | 8,389,354   | 
|                                                                                                                                                                    |  |  |  |                            |  |  |             |  |  |  |  | 
|Weighted average Units, dilutive potential units plus assumed
    conversions used for the calculation of FFO available to
    unitholders plus assumed conversions |  |  |  |                            |  |  | 451,728,242 |  |  |  |  |  |  |  | 458,923,195 | 
|                                                                                                                                                                    |  |  |  |                            |  |  |             |  |  |  |  | 






|    |  |                                                                                                                                                                                                                                                                                                                
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | FFO is a non-GAAP financial measure. The most directly
    comparable GAAP measure is net (loss) income, to which it is
    reconciled. See definition below.                                                                                                                                                  
|   
|(b) |  | FFO per unit may not total the sum of the per unit components in
    the reconciliation due to rounding.                                                                                                                                                                                                       
|   
|(c) |  | The Series B preferred units are not dilutive to earnings
    per unit for each quarter presented or FFO per unit for the
    three months ended June 30, 2005, but are dilutive to FFO
    per unit for the three months ended June 30, 2004.                                                                 
|   
|(d) |  | FFO for the three months ended June 30, 2005 includes
    approximately $367.0 million of non-cash charges relating
    to properties sold or properties we intend to sell, which is
    equivalent to $0.81 per unit on a diluted basis. This
    charge is not added back to net income when calculating FFO.

|                                                                                                                                                                                                                                                                |  |                                   |         |              |                 |   |       |         |              |   |                 |   |  |   |       |  
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------- | ------- | ------------ | --------------- | - | ----- | ------- | ------------ | - | --------------- | - |  | - | ----- | -
|                                                                                                                                                                                                                                                                |  | For the six months ended June 30, |        
|                                                                                                                                                                                                                                                                |  |                                   |        
|                                                                                                                                                                                                                                                                |  | 2005                              |         |              | 2004            |  
|                                                                                                                                                                                                                                                                |  |                                   |         |              |                 |  
|                                                                                                                                                                                                                                                                |  |                                   |         | Per Weighted |                 |   |       |         | Per Weighted |  
|(Dollars in thousands, except per unit amounts)                                                                                                                                                                                                                 |  | Dollars                           |         |              | Average Unit(b) |   |       | Dollars |              |   | Average Unit(b) |  
|                                                                                                                                                                                                                                                                |  |                                   |         |              |                 |   |       |         |              |   |                 |  
|Reconciliation of net (loss) income to FFO(a):                                                                                                                                                                                                                  |  |                                   |         |              |                 |   |       |         |              |   |                 |   |  |   |       |  
|Net (loss) income                                                                                                                                                                                                                                               |  | $                                 | (99,093 | )            |                 | $ | (0.22 | )       |              | $ | 207,606         |   |  | $ | 0.46  |  
|Plus real estate related depreciation and amortization less gain
    and losses 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 |  |                                   | 316,038 |              |                 |   | 0.70  |         |              |   | 383,892         |   |  |   | 0.86  |  
|Plus cumulative effect of a change in accounting principle                                                                                                                                                                                                      |  |                                   |        |              |                 |   |      |         |              |   | 33,697          |   |  |   | 0.08  |  
|                                                                                                                                                                                                                                                                |  |                                   |         |              |                 |   |       |         |              |   |                 |  
|FFO                                                                                                                                                                                                                                                             |  |                                   | 216,945 |              |                 |   | 0.48  |         |              |   | 625,195         |   |  |   | 1.39  |  
|Preferred distributions                                                                                                                                                                                                                                         |  |                                   | (17,402 | )            |                 |   | (0.04 | )       |              |   | (21,692         | ) |  |   | (0.05 | )
|                                                                                                                                                                                                                                                                |  |                                   |         |              |                 |   |       |         |              |   |                 |  
|FFO available to unitholders  basic                                                                                                                                                                                                                            |  |                                   | 199,543 |              |                 | $ | 0.44  | (d)     |              | $ | 603,503         |   |  | $ | 1.34  |  
|                                                                                                                                                                                                                                                                |  |                                   |         |              |                 |   |       |         |              |   |                 |  

57



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|                                                                                                            |  |                                   |             |   |      |   |             |            |  |   |             |   |  |   |             |  
|----------------------------------------------------------------------------------------------------------- |  | --------------------------------- | ----------- | - | ---- | - | ----------- | ---------- |  | - | ----------- | - |  | - | ----------- | -
|                                                                                                            |  | For the six months ended June 30, |            
|                                                                                                            |  |                                   |            
|                                                                                                            |  | 2005                              |             |   | 2004 |  
|                                                                                                            |  |                                   |             |   |      |  
|(Dollars in thousands, except per unit amounts)                                                             |  | Net Income                        |             |   | FFO  |   |             | Net Income |  |   | FFO         |  
|                                                                                                            |  |                                   |             |   |      |   |             |            |  |   |             |  
|Adjustments to arrive at FFO available to
    unitholders plus assumed conversions:                         |  |                                   |             |   |      |   |             |            |  |   |             |   |  |   |             |  
|Net (loss) income and FFO                                                                                   |  | $                                 | (99,093     | ) |      | $ | 216,945     |            |  | $ | 207,606     |   |  | $ | 625,195     |  
|Preferred distributions                                                                                     |  |                                   | (17,402     | ) |      |   | (17,402     | )          |  |   | (21,692     | ) |  |   | (21,692     | )
|                                                                                                            |  |                                   |             |   |      |   |             |            |  |   |             |  
|Net (loss) income and FFO available to unitholders                                                          |  |                                   | (116,495    | ) |      |   | 199,543     |            |  |   | 185,914     |   |  |   | 603,503     |  
|Preferred distributions on Series B preferred units, of
    which are assumed to be converted into Units(c) |  |                                   |            |   |      |   |            |            |  |   |            |   |  |   | 9,167       |  
|                                                                                                            |  |                                   |             |   |      |   |             |            |  |   |             |  
|Net (loss) income and FFO available to unitholders plus assumed
    conversions                             |  | $                                 | (116,495    | ) |      | $ | 199,543     |            |  | $ | 185,914     |   |  | $ | 612,670     |  
|                                                                                                            |  |                                   |             |   |      |   |             |            |  |   |             |  
|Weighted average Units, dilutive potential units plus assumed
    conversions outstanding                   |  |                                   | 450,881,385 |   |      |   | 454,101,167 |            |  |   | 450,840,364 |   |  |   | 459,229,718 |  
|                                                                                                            |  |                                   |             |   |      |   |             |            |  |   |             |  
|Net (loss) income and FFO available to unitholders plus assumed
    conversions per unit                    |  | $                                 | (0.26       | ) |      | $ | 0.44        | (d)        |  | $ | 0.41        |   |  | $ | 1.33        |  
|                                                                                                            |  |                                   |             |   |      |   |             |            |  |   |             |  

|                                                                                                                                                                    |  |  |  |                            |  |  |             |  |  |  |  |  |  |  |             | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  |  | -------------------------- |  |  | ----------- |  |  |  |  |  |  |  | ----------- | 
|                                                                                                                                                                    |  |  |  | Units and unit equivalents | 
|                                                                                                                                                                    |  |  |  |                            | 
|Weighted average Units outstanding (used for both net (loss)
    income and FFO basic per unit calculation)                                                         |  |  |  |                            |  |  | 450,881,385 |  |  |  |  |  |  |  | 448,902,096 | 
|Impact of share options and restricted shares which are dilutive
    to both net income and FFO                                                                     |  |  |  |                            |  |  |            |  |  |  |  |  |  |  | 1,938,268   | 
|                                                                                                                                                                    |  |  |  |                            |  |  |             |  |  |  |  | 
|Weighted average Units and dilutive potential units used for net
    (loss) income available to unitholders                                                         |  |  |  |                            |  |  | 450,881,385 |  |  |  |  |  |  |  | 450,840,364 | 
|Impact of conversion of Series B preferred units(c)                                                                                                                 |  |  |  |                            |  |  |            |  |  |  |  |  |  |  | 8,389,354   | 
|Impact of share options and restricted shares which are dilutive
    to FFO but not dilutive to net (loss)                                                          |  |  |  |                            |  |  | 3,219,782   |  |  |  |  |  |  |  |            | 
|                                                                                                                                                                    |  |  |  |                            |  |  |             |  |  |  |  | 
|Weighted average Units, dilutive potential units plus assumed
    conversions used for the calculation of FFO available to
    unitholders plus assumed conversions |  |  |  |                            |  |  | 454,101,167 |  |  |  |  |  |  |  | 459,229,718 | 
|                                                                                                                                                                    |  |  |  |                            |  |  |             |  |  |  |  | 






|    |  |                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | FFO is a non-GAAP financial measure. The most directly
    comparable GAAP measure is net (loss) income, to which it is
    reconciled. See definition below.                                                                                                                                                 
|   
|(b) |  | FFO per unit may not total the sum of the per unit components in
    the reconciliation due to rounding.                                                                                                                                                                                                      
|   
|(c) |  | The Series B preferred units are not dilutive to earnings
    per unit for each period presented or FFO per unit for the six
    months ended June 30, 2005 but are dilutive to FFO per unit
    for the six months ended June 30, 2004.                                                                      
|   
|(d) |  | FFO for the six months ended June 30, 2005 includes
    approximately $380.6 million of non-cash charges relating
    to properties sold and properties we intend to sell, which is
    equivalent to $0.84 per unit on a diluted basis. This
    charge is not added back to net income when calculating FFO.

FFO Definition:




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








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



| |                                                 
| | ------------------------------------------------
| | Evaluation of Disclosure Controls and Procedures





| |                                                         
| | --------------------------------------------------------
| | Changes in Internal Control over Financial
    Reporting





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##### Table of Contents






Part II  OTHER INFORMATION







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








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



|             |                     |                    |           |           |                    |                    |       |                 |                       |  |              |   |  |  |   |   | 
|------------ | ------------------- | ------------------ | --------- | --------- | ------------------ | ------------------ | ----- | --------------- | --------------------- |  | ------------ | - |  |  | - | - | 
|             |                     |                    |           |           |                    | Total Number of    |       |                 | Dollar Value of Units | 
|             |                     |                    |           |           |                    | Units Purchased as |       |                 | that May Yet be       | 
|             |                     |                    |           |           |                    | Part of Publicly   |       |                 | Purchased Under       | 
|             |                     | Total Number of    |           |           | Average Price Paid |                    |       | Announced Plans |                       |  | the Plans or |  
|Period       |                     | Units Purchased(a) |           |           | per Unit           |                    |       | or Programs     |                       |  | Programs     |  
|             |                     |                    |           |           |                    |                    |       |                 |                       |  |              |  
|April 1  30 |                     |                    | 55,461    |           |                    | $                  | 30.40 |                 |                       |  |             |   |  |  |  |  
|May 1  31   |                     |                    | 1,556,575 |           |                    |                    | 30.90 |                 |                       |  |             |   |  |  |  |  
|June 1  30  |                     |                    | 38,158    |           |                    |                    | 33.08 |                 |                       |  |             |   |  |  |  |  
|             |                     |                    |           |           |                    |                    |       |                 |                       |  |              |  
|             | Second quarter 2005 |                    |           | 1,650,194 |                    |                    | $     | 30.93           |                       |  |              |  |  |  |   |  | 
|             |                     |                    |           |           |                    |                    |       |                 |                       |  |              |  






|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | The number of Units purchased is comprised of the redemption of
    Units held by our limited partners, excluding Equity Office.
    Units redeemed in exchange for Common Shares which are not
    considered a repurchase and are, therefore, excluded from the
    table above. At any time on or after the first anniversary of
    the date of issuance, our limited partners have the right to
    require EOP Partnership to redeem their Units, subject to
    certain limitations. Equity Office, on behalf of and as the
    general partner of EOP Partnership, has the right to cause the
    redemption obligation to be satisfied by issuance of an
    equivalent number of Common Shares, or by a cash payment equal
    to the value of such Common Shares. Also included in the total
    number of Units purchased are Units redeemed in response to
    repurchases made by Equity Office, including repurchases of
    Equity Office Common Shares in the open market (a) as part
    of its Common Share Repurchase Program, (b) as part of its
    Supplemental Retirement Savings Plan, (c) to fund shares
    purchased under its 1997 Employee Share Purchase Plan and
    (d) to fund fees paid in Equity Office Common Shares to
    each of its nonemployee trustees, except Mr. Zell, as well
    as Equity Office Common Shares surrendered to Equity Office to
    satisfy withholding obligations in connection with the vesting
    of restricted stock issued to employees.








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



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##### Table of Contents






SIGNATURES




|                     |  |                                                                                                                                                         
|-------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------
|                     |  | EOP OPERATING LIMITED PARTNERSHIP                                                                                                                       
|                    
|                     |  | By: EQUITY OFFICE PROPERTIES TRUST
    its general partner                                                                                              
|                    
|Date: August 9, 2005 |  | /s/ RICHARD D. KINCAID                                                                                                                                  
|                     |  |                                                                                                                                                         
|                     |  | Richard D. Kincaid                                                                                                                                      
|                     |  | President and Chief Executive Officer
    of Equity Office Properties Trust, the general
    partner of EOP Operating Limited Partnership               
|                    
|Date: August 9, 2005 |  | /s/ MARSHA C. WILLIAMS                                                                                                                                  
|                     |  |                                                                                                                                                         
|                     |  | Marsha C. Williams                                                                                                                                      
|                     |  | Executive Vice President and Chief Financial Officer
    of Equity Office Properties Trust, the general
    partner of EOP Operating Limited Partnership

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##### Table of Contents






EXHIBIT INDEX


|        |      |  |             |                                                                                                                                                                                                                      |          |                                                                                                                                                                
|------- | ---- |  | ----------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |      |  |             |                                                                                                                                                                                                                      |         
|No.     |      |  | Description |                                                                                                                                                                                                                      | Location
|        |      |  |             |                                                                                                                                                                                                                      |         
|        | 3.1  |  |             | Fifth Amendment to Third Amended and Restated Agreement of
    Limited Partnership of EOP Operating Limited Partnership                                                                                              |          | Filed herewith                                                                                                                                                 
|       
|        | 4.1  |  |             | Indenture, dated August 29, 2000, by and between EOP
    Operating Limited 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 Operating
    Limited Partnerships Registration Statement on
    Form S-3, as amended (SEC File No. 333-43530)
|       
|        | 4.2  |  |             | First Supplemental Indenture, dated June 18, 2001, among
    EOP Operating Limited 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)                    
|       
|        | 4.3  |  |             | New Trustee Appointment Agreement, dated June 10, 2004,
    among EOP Operating Limited 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 Operating Limited Partnership
    filed with the SEC on June 15, 2004    
|       
|        | 4.4  |  |             | 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 Operating Limited Partnership
    filed with the SEC on June 15, 2004    
|       
|        | 4.5  |  |             | Schedule of Medium-Term InterNotes (Fixed Rate) issued from
    April 1, 2005 to June 30, 2005                                                                                                                       |          | Filed herewith                                                                                                                                                 
|       
|        | 10.1 |  |             | Revolving Credit Agreement for $1,250,000,000 Revolving Credit
    Facility dated as of August 4, 2005 among EOP Operating
    Limited Partnership and the Banks listed therein, and related
    Guaranty of Payment |          | Filed herewith                                                                                                                                                 
|       
|        | 12.1 |  |             | Statement of Computation of Ratio of Earnings to Fixed Charges                                                                                                                                                       |          | Filed herewith                                                                                                                                                 
|       
|        | 31.1 |  |             | Certification of Chief Executive Officer pursuant to
    Rule 13a-14(a) and Rule 15d-14(a) of the Securities
    Exchange Act, as amended                                                                            |          | Filed herewith                                                                                                                                                 
|       
|        | 31.2 |  |             | Certification of Chief Financial Officer pursuant to
    Rule 13a-14(a) and Rule 15d-14(a) of the Securities
    Exchange Act, as amended                                                                            |          | Filed herewith                                                                                                                                                 
|       
|        | 32.1 |  |             | Certification of Chief Executive Officer and Chief Financial
    Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002                                        |          | Filed herewith                                                                                                                                                 

62