| Maryland                                                       | 95-2635431                           |
|----------------------------------------------------------------|--------------------------------------|
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
|                                                           |                                 |
| 10050 Bandley Drive, Cupertino, CA                             | 95014                                |
| (Address of principal executive offices)                       | (Zip Code)                           |

|                                    |                                      |
|-----------------------------------------|-------------------------------------------|
| Title of each class                     | Name of each exchange on which registered |
| Common Stock, $.001 par value per share | The Nasdaq Stock Market LLC               |

| Class                                   |   | Outstanding at February 28, 2010 |
|-----------------------------------------|--------|----------------------------------|
| Common Stock, $.001 par value per share |   | 21,877,211 shares                |

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|     | PART I                                                                                                                 | Page No. |
|----------|------------------------------------------------------------------------------------------------------------------------|----------|
| Item 1.  | Business                                                                                                               | 1        |
| Item 1A. | Risk Factors                                                                                                           | 8        |
| Item 1B. | Unresolved Staff Comments                                                                                              | 14       |
| Item 2.  | Properties                                                                                                             | 15       |
| Item 3.  | Legal Proceedings                                                                                                      | 20       |
| Item 4.  | Reserved                                                                                                               | 20       |
|     | PART II                                                                                                                |     |
| Item 5.  | Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 21       |
| Item 6.  | Selected Financial Data                                                                                                | 23       |
| Item 7.  | Management’s Discussion and Analysis of Financial Condition and Results of Operations                            | 25       |
| Item 7A. | Quantitative and Qualitative Disclosures About Market Risk                                                             | 40       |
| Item 8.  | Financial Statements and Supplementary Data                                                                            | 41       |
| Item 9.  | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure                                   | 80       |
| Item 9A. | Controls and Procedures                                                                                                | 80       |
| Item 9B. | Other Information                                                                                                      | 80       |
|     | PART III                                                                                                               |     |
| Item 10. | Directors, Executive Officers and Corporate Governance                                                                 | 81       |
| Item 11. | Executive Compensation                                                                                                 | 81       |
| Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters                         | 81       |
| Item 13. | Certain Relationships and Related Transactions, and Director Independence                                              | 81       |
| Item 14. | Principal Accountant Fees and Services                                                                                 | 81       |
|     | PART IV                                                                                                                |     |
| Item 15. | Exhibits and Financial Statement Schedules                                                                             | 82       |
|     | Signatures                                                                                                             | 83       |
|     | Rule 13a-14(a) Certifications                                                                                          |     |
|     | Section 1350 Certifications                                                                                            |     |

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| ·   | control the operating partnerships; |
|--------------------|-------------------------------------|

| ·   | until December 31, 2010, acquire, subject to approval of the Independent Directors Committee of the Board of Directors, on pre-negotiated terms, all future R&D properties developed by the Berg Group on land currently owned or acquired in the future; and |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | acquire R&D, office and industrial properties identified by the Berg Group in California, Oregon and Washington, subject to approval of the Independent Directors Committee of the Board of Directors. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

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|   |   |
|--------|--------|

| ·   | designate two of five nominees for director to be elected by our stockholders, subject to the Berg Group’s maintenance of certain ownership interests; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | participate in our securities offerings; |
|--------------------|------------------------------------------|

| ·   | exchange their operating partnership interests (“O.P. Units”) for shares of our common stock; |
|--------------------|-----------------------------------------------------------------------------------------------------------|

| ·   | vote on major transactions, subject to maintenance of certain ownership thresholds; and |
|--------------------|-----------------------------------------------------------------------------------------|

| ·   | prevent us from selling properties when the sale will have adverse tax consequences to the Berg Group members. |
|--------------------|----------------------------------------------------------------------------------------------------------------|

| ·   | So long as the Berg Group members and their affiliates own or have the right to acquire shares representing at least 65% of our common stock on a Fully Diluted basis, or until December 31, 2010, whichever occurs first, we have the option to acquire any building developed by any member of the Berg Group on the land subject to the Berg Land Holdings Option Agreement at such time as the building has been leased. Upon our exercise of the option, the option price will equal the sum of the following or a lesser amount as approved by the Independent Directors Committee: |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 1.   | the full construction cost of the building; plus |
|----------------|--------------------------------------------------|

| 2.   | 10% of the full construction cost of the building; plus |
|----------------|---------------------------------------------------------|

| 3.   | interest at LIBOR plus 1.65%, on the amount of the full construction cost of the building for the period from the date funds were disbursed by the developer to the close of escrow; plus |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.   | the original acquisition cost of the parcel on which the improvements will be constructed, which range from $8.50 to $20.00 per square foot for land currently owned or under option; plus |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.   | 10% per annum of the amount of the original acquisition cost of the parcel from the later of January 1, 1998 and the seller’s acquisition date, to the close of escrow; minus |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.   | the aggregate principal amount of all debt encumbering the acquired property. |
|----------------|-------------------------------------------------------------------------------|

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| ·   | The acquisition cost, net of any debt, will be payable in cash, or O.P. Units valued at the average closing price of our common stock over the 30-trading-day period preceding the acquisition or, in cash, at the option of the Berg Group. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | We also must assume all property tax assessments. |
|--------------------|---------------------------------------------------|

| ·   | If we elect not to exercise the option with respect to any property, the Berg Group may hold and lease the property for its own account, or may sell it to a third party. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | All action taken by us under the Berg Land Holdings Option Agreement, including any variations from stated terms outlined above must be approved by a majority of the members of the Independent Directors Committee. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

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

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

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| ·   | External Development Affiliate. Although the Berg Land Holdings Option Agreement expires on December 31, 2010, we anticipate that our relationship with the Berg Group will continue to help us achieve our objectives of long-term sustainable growth as well as maximization of long-term stockholder value. We will still have access to one of the most experienced development teams in the Silicon Valley without the expense of maintaining development personnel. In addition, with the Berg Group’s extensive experience and strong relationship in the Silicon Valley real estate industry, we believe we are well-positioned to take advantage of attractive acquisition and development opportunities. The relationship with the Berg Group helps us maintain and develop long-term relationships with a diverse tenant base and manage operating expenses, capital improvements and tenant improvements through the efficient use of our internal management and leasing function. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Lean Organization, Experienced Team.  In part because of our primary focus on Silicon Valley, our experience with the special real estate requirements of information technology tenants and the long-term triple-net structure of our leases, we are able to conduct and expand our business with a small management team comprised of highly qualified and experienced professionals working within a relatively flat organizational structure.  We believe that the leanness of our organization and our experience will enable us to rapidly assess and respond to market opportunities and tenant needs, control operating expenses and develop and maintain excellent relationships with tenants. We further believe that these advantages translate into significantly lower costs for operations and give us the ability, along with the Berg Group, to compete favorably with other R&D property developers in Silicon Valley, especially for build-to-suit projects subject to competitive bidding.  Furthermore, we believe this lower cost structure allows us to generate better returns from properties whose value can be increased through appropriate remodeling and efficient property management. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Sound Property Management Practices.  For each property, the management team, along with the Berg Group staff, develops a specific marketing and property management program.  We select vendors and subcontractors on a competitive bid basis from a select group of highly qualified firms with whom we maintain ongoing relationships and carefully supervise their work. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the amendment, modification or termination of the operating partnership agreements; |
|--------------------|-------------------------------------------------------------------------------------|

| ·   | a general assignment for the benefit of creditors or the appointment of a custodian, receiver or trustee for any of the assets of the operating partnerships; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the institution of any proceeding for bankruptcy of the operating partnerships; |
|--------------------|---------------------------------------------------------------------------------|

| ·   | the transfer of any general partner interests in the operating partnerships, including, with certain exceptions, transfers attendant to any merger, consolidation or liquidation of our corporation; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the admission of any additional or substitute general partner in the operating partnerships; and |
|--------------------|--------------------------------------------------------------------------------------------------|

| ·   | a change of control of the operating partnerships. |
|--------------------|----------------------------------------------------|

| ·   | the liquidation of the operating partnerships; |
|--------------------|------------------------------------------------|

| ·   | the sale or other transfer of all or substantially all of the assets of the operating partnerships and certain mergers and business combinations resulting in the complete disposition of all O.P. Units; and |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the issuance of limited partnership interests having seniority as to distributions, assets and voting over the O.P. Units. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------|

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| ·   | the amendment, modification or termination of any of the operating partnership agreements; |
|--------------------|--------------------------------------------------------------------------------------------|

| ·   | the transfer of any general partner interest in the operating partnerships, including, with certain exceptions, transfers attendant to any merger, consolidation or liquidation of our corporation; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the admission of any additional or substitute general partners in the operating partnerships; |
|--------------------|-----------------------------------------------------------------------------------------------|

| ·   | any other change of control of the operating partnerships; |
|--------------------|------------------------------------------------------------|

| ·   | a general assignment for the benefit of creditors or the appointment of a custodian, receiver or trustee for any of the assets of the operating partnerships; and |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the institution of any bankruptcy proceeding for any operating partnership. |
|--------------------|-----------------------------------------------------------------------------|

|   |   |
|--------|--------|

| ·   | the sale or other transfer of all or substantially all of the assets of the operating partnerships and certain mergers and business combinations resulting in the complete disposition of all O.P. Units; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the issuance of limited partnership interests senior to the O.P. Units as to distributions, assets and voting; and |
|--------------------|--------------------------------------------------------------------------------------------------------------------|

| ·   | the liquidation of the operating partnerships. |
|--------------------|------------------------------------------------|

|   |   |
|--------|--------|

| ·   | our headquarters are leased from an entity owned by the Berg Group, to whom we pay rent of $10,000 per month; |
|--------------------|---------------------------------------------------------------------------------------------------------------|

| ·   | the Berg Group is permitted to conduct real estate and business activities other than our business; |
|--------------------|-----------------------------------------------------------------------------------------------------|

| ·   | if we decline an opportunity that has been offered to us under the terms of the Berg Land Holdings Option Agreement and the Acquisition Agreement, the Berg Group may pursue it, which would reduce the amount of time that Mr. Berg could devote to our affairs and could result in the Berg Group’s development of properties that compete with our properties for tenants; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | in general, we have agreed to limit the liability of the Berg Group to our corporation and our stockholders arising from the Berg Group’s pursuit of these other opportunities; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | we acquired most of our properties from the Berg Group on terms that were not negotiated at arm’s length and without many customary representations and warranties that we would have sought in an acquisition from an unrelated party; and |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | we have assumed liability for debt to the Berg Group and debt for which the Berg Group was liable. |
|--------------------|----------------------------------------------------------------------------------------------------|

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| ·   | the amount of cash available for distribution; |
|--------------------|------------------------------------------------|

| ·   | availability of financing; |
|--------------------|----------------------------|

| ·   | our financial condition; |
|--------------------|--------------------------|

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

| ·   | our committed and projected capital expenditures; |
|--------------------|---------------------------------------------------|

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

| ·   | the amount of our annual debt service requirements; |
|--------------------|-----------------------------------------------------|

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

| ·   | our projected rental rates and revenues; |
|--------------------|------------------------------------------|

| ·   | our ability to collect rent payments; |
|--------------------|---------------------------------------|

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

| ·   | cash required for re-leasing activities; and |
|--------------------|----------------------------------------------|

| ·   | such other factors as our Board of Directors deem relevant. |
|--------------------|-------------------------------------------------------------|

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| ·   | anticipate trends in the market; |
|--------------------|----------------------------------|

| ·   | identify and concentrate our efforts on the most favorably located sub-markets; |
|--------------------|---------------------------------------------------------------------------------|

| ·   | take advantage of our experience and extensive contacts and relationships with local government agencies, real estate brokers and subcontractors, as well as with tenants and prospective tenants; and |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | identify strong tenants. |
|--------------------|--------------------------|

|      Location               |     No. of Properties |    TotalRentableSq. Ft. |    PercentageOccupied as ofDec. 31, 2009 |     Average 2009 Occupancy |      Major Tenants                      |  Major Tenants RentableSq. Ft. at 12/31/09 |     2009 AnnualBase Rent (1) |
|------------------------------------------------------|-------------------------------------------|----------------------------------------|---------------------------------------------------------|------------------------------------------------|------------------------------------------------------------------|-------------------------------------------------|--------------------------------------------------|
| 5300-5350 Hellyer Avenue (2)                         | 2                                         | 160,000                                | 100%                                                    | 100%                                           | Tyco Electronics Corporation                                     | 160,000                                         | $3,959,614                                       |
|                                                 |                                      |                                   |                                                    |                                           |                                                             |                                            |                                             |
| 10401-10411 Bubb Road (2)                            | 1                                         | 20,330                                 | 78%                                                     | 78%                                            | Aeroflex, Inc.                                                   | 15,830                                          |     246,952                  |
|                                                 |                                      |                                   |                                                    |                                           |                                                             |                                            |                                             |
| 45365 Northport Loop West                            | 1                                         | 64,218                                 | 15%                                                     | 8.6%                                           | Optovue, Inc.                                                    | 9,373                                           | 28,120                                           |
|                                                 |                                      |                                   |                                                    |                                           |                                                             |                                            |                                             |
| 45738 Northport Loop West                            | 1                                         | 44,256                                 | 100%                                                    | 100%                                           | Quicksil, Inc.                                                   | 44,256                                          | 632,861                                          |
|                                                 |                                      |                                   |                                                    |                                           |                                                             |                                            |                                             |
| 4050 Starboard Drive                                 | 1                                         | 52,232                                 | 100%                                                    | 100%                                           | Flash Electronics, Inc.                                          | 52,232                                          | 519,813                                          |
|                                                 |                                      |                                   |                                                    |                                           |                                                             |                                            |                                             |
| 3501 West Warren Avenue &46600 Fremont Boulevard | 1                                         | 67,864                                 | 24%                                                     | 24%                                            | Sunnyvale Fluid System Tech, Inc.                                | 16,524                                          | 145,200                                          |
|                                                 |                                      |                                   |                                                    |                                           |                                                             |                                            |                                             |
| 48800 Milmont Drive                                  | 1                                         | 53,000                                 | 0%                                                      | 0%                                             | Vacant                                                           | -                                               | -                                                |
|                                                 |                                      |                                   |                                                    |                                           |                                                             |                                            |                                             |
| 4750 Patrick Henry Drive                             | 1                                         | 63,105                                 | 100%                                                    | 100%                                           | Infoblox, Inc.                                                   | 63,105                                          | 541,441                                          |
|                                                 |                                      |                                   |                                                    |                                           |                                                             |                                            |                                             |
| Triangle Technology Park (2)                         | 7                                         | 416,927                                | 78%                                                     | 77%                                            | Intevac CorporationXicom Technology, Inc.LSA Cleanpart, LLCSASCO | 169,79572,33628,30025,350                       | 3,405,533                                        |

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|     Location |     No. of Properties |    TotalRentableSq. Ft. |    PercentageOccupied as ofDec. 31, 2009 |     Average 2009 Occupancy |      Major Tenants |  Major Tenants RentableSq. Ft. at 12/31/09 |     2009 AnnualBase Rent (1) |
|----------------------------------|-------------------------------------------|----------------------------------------|---------------------------------------------------------|------------------------------------------------|---------------------------------------------|-------------------------------------------------|--------------------------------------------------|

|                              |   |    |   |   |                                    |         |          |
|-----------------------------------|--------|---------|--------|--------|-----------------------------------------|--------------|---------------|
| 5830-5870 Hellyer Avenue          | 1      | 109,715 | 71%    | 64%    | Shocking Technologies, Inc.MeiVac, Inc. | 51,85926,557 | 689,156       |
|                              |   |    |   |   |                                    |         |          |
| 5750 Hellyer Avenue               | 1      | 73,312  | 100%   | 100%   | NDS Surgical Imaging, LLC               | 73,312       | 712,004       |
|                              |   |    |   |   |                                    |         |          |
| 5500-5550 Hellyer Avenue          | 2      | 196,534 | 67%    | 67%    | CTS CorporationSnap-on, Inc.            | 78,79452,243 | 1,987,264     |
|                              |   |    |   |   |                                    |         |          |
| 5400 Hellyer Avenue               | 1      | 77,184  | 60%    | 53%    | Quantum 3D, Inc.Capella, Inc.           | 24,77721,750 | 545,472       |
|                              |   |    |   |   |                                    |         |          |
| 5325-5345 Hellyer Avenue          | 2      | 256,500 | 100%   | 100%   | Celestica Asia, Inc.                    | 256,500      | 6,150,192     |
|                              |   |    |   |   |                                    |         |          |
| 5905-5965 Silver Creek Valley Rd. | 4      | 346,000 | 0%     | 0%     | Vacant                                  | -            | -             |
|                              |   |    |   |   |                                    |         |          |
| 5845 Hellyer Avenue               | 1      | 98,500  | 0%     | 0%     | Vacant                                  | -            | -             |
|                              |   |    |   |   |                                    |         |          |
| 855 Embedded Way                  | 1      | 67,912  | 100%   | 100%   | Celestica Asia, Inc.Lynuxworks, Inc.    | 39,03928,873 | 1,068,000     |
|                              |   |    |   |   |                                    |         |          |
| 1065-1105 La Avenida Street       | 5      | 515,700 | 100%   | 100%   | Microsoft Corporation                   | 515,700      | 12,873,252    |
|                              |   |    |   |   |                                    |         |          |
| 1875 Charleston Road              | 1      | 42,126  | 100%   | 100%   | Netlogic Microsystems, Inc.             | 42,126       | 893,028       |
|                              |   |    |   |   |                                    |         |          |
| 1750 Automation Parkway           | 1      | 80,641  | 100%   | 100%   | JDS Uniphase Corporation                | 80,641       | 1,514,918     |
|                              |   |    |   |   |                                    |         |          |
| 1756 Automation Parkway           | 1      | 80,640  | 36%    | 36%    | A&D Engineering, Inc.               | 28,739       | 326,883       |
|                              |   |    |   |   |                                    |         |          |
| 1762 Automation Parkway           | 1      | 61,100  | 100%   | 100%   | Hermes Microvision, Inc.                | 61,100       | 730,470       |
|                              |   |    |   |   |                                    |         |          |
| 1768 Automation Parkway           | 1      | 110,592 | 67%    | 67%    | 2Wire, Inc.                             | 74,584       | 930,504       |
|                              |   |    |   |   |                                    |         |          |
| 255 Caspian Drive                 | 1      | 119,756 | 100%   | 100%   | Equinix Operating Company, Inc.         | 119,756      | 2,608,286     |
|                              |   |    |   |   |                                    |         |          |
| 245 Caspian Drive (3)             | 1      | -       | -      | -      | -                                       | -            | -             |
|                              |   |    |   |   |                                    |         |          |
| 5981 Optical Court                | 1      | 110,542 | 100%   | 100%   | SoloPower, Inc.                         | 110,542      | 2,252,400     |
|                              |   |    |   |   |                                    |         |          |
| 5970 Optical Court                | 1      | 128,520 | 100%   | 100%   | Orbotech Ltd.                           | 128,520      | 1,937,961     |
|                              |   |    |   |   |                                    |         |          |
| 5900 Optical Court                | 1      | 165,000 | 100%   | 100%   | Stryker Corporation                     | 165,000      | 3,581,316     |
|                              |   |    |   |   |                                    |         |          |
| 2630 Orchard Parkway              | 1      | 60,633  | 0%     | 0%     | Vacant                                  | -            | -             |
|                              |   |    |   |   |                                    |         |          |
| 2610 Orchard Parkway              | 1      | 54,093  | 0%     | 0%     | Vacant                                  | -            | -             |
|                              |   |    |   |   |                                    |         |          |
| 55 West Trimble Road              | 1      | 91,722  | 0%     | 0%     | Vacant                                  | -            | -             |
|                              |   |    |   |   |                                    |         |          |
| 2001 Walsh Avenue                 | 1      | 80,000  | 100%   | 100%   | Nvidia Corporation                      | 80,000       | 981,415       |
|                              |   |    |   |   |                                    |         |          |
| 2880 Scott Boulevard              | 1      | 200,000 | 100%   | 100%   | NEC Electronics America, Inc.           | 200,000      | 2,720,784     |
|                              |   |    |   |   |                                    |         |          |
| 2890 Scott Boulevard              | 1      | 75,000  | 100%   | 100%   | Nvidia Corporation                      | 75,000       | 1,602,564     |
|                              |   |    |   |   |                                    |         |          |
| 2770-2800 Scott Boulevard         | 1      | 99,800  | 100%   | 100%   | Nvidia Corporation                      | 99,800       | 1,352,794     |
|                              |   |    |   |   |                                    |         |          |
| 2300 Central Expressway           | 1      | 46,338  | 0%     | 16%    | Vacant                                  | 46,338       | 111,192       |
|                              |   |    |   |   |                                    |         |          |
| 2220 Central Expressway           | 1      | 62,522  | 100%   | 100%   | Tellabs, Inc.                           | 62,522       | 766,710       |
|                              |   |    |   |   |                                    |         |          |
| 2330 Central Expressway           | 1      | 62,522  | 100%   | 100%   | Huawei Technologies Company Ltd.        | 62,522       | 850,678       |
|                              |   |    |   |   |                                    |         |          |
| 233 South Hillview Drive          | 2      | 95,690  | 100%   | 100%   | Exar Corporation                        | 95,690       | 1,370,178     |
|                              |   |    |   |   |                                    |         |          |
| 2251 Lawson Lane                  | 1      | 125,000 | 51%    | 51%    | Synaptics, Inc.                         | 64,270       | 1,159,903     |
|                              |   |    |   |   |                                    |         |          |
| 1230 East Arques                  | 1      | 60,000  | 100%   | 100%   | Fujitsu                                 | 60,000       |  349,964 |
|                              |   |    |   |   |                                    |         |          |
| 1250 East Arques                  | 4      | 200,000 | 100%   | 100%   | Fujitsu                                 | 200,000      |  869,311 |

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|     Location |     No. of Properties |    TotalRentableSq. Ft. |    PercentageOccupied as ofDec. 31, 2009 |     Average 2009 Occupancy |      Major Tenants |  Major Tenants RentableSq. Ft. at 12/31/09 |     2009 AnnualBase Rent (1) |
|----------------------------------|-------------------------------------------|----------------------------------------|---------------------------------------------------------|------------------------------------------------|---------------------------------------------|-------------------------------------------------|--------------------------------------------------|

|                                                      |   |                           |   |   |                                                                                 |               |            |
|-----------------------------------------------------------|--------|--------------------------------|--------|--------|--------------------------------------------------------------------------------------|--------------------|-----------------|
| 20400 Mariani Avenue                                      | 1      | 105,000                        | 100%   | 100%   | Apple, Inc.                                                                          | 105,000            |  626,743   |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 10500 De Anza Boulevard                                   | 1      | 211,000                        | 100%   | 100%   | Apple, Inc.                                                                          | 211,000            |  4,192,686 |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 20605-705 Valley Green Drive                              | 2      | 142,000                        | 100%   | 100%   | Apple, Inc.                                                                          | 142,000            |  2,562,475 |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 10300 Bubb Road                                           | 1      | 23,400                         | 100%   | 100%   | Apple, Inc.                                                                          | 23,400             | 285,714         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 10440 Bubb Road                                           | 1      | 19,500                         | 100%   | 100%   | Novare Surgical Systems, Inc.                                                        | 10,833             | 281,776         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 10450-10460 Bubb Road                                     | 1      | 45,460                         | 100%   | 100%   | Ricoh CorporationVMWare, Inc.                                                        | 30,46015,000       | 736,123         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 1135 Kern Avenue                                          | 1      | 18,300                         | 0%     | 0%     | Vacant                                                                               | -                  | -               |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 450 National Avenue                                       | 1      |  36,100                   | 0%     | 0%     | Vacant                                                                               | -                  | -               |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 3301 Olcott Street                                        | 1      |     64,500 | 0%     | 0%     | Vacant                                                                               | -                  | -               |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 2800 Bayview Avenue                                       | 1      | 59,736                         | 0%     | 0%     | Vacant                                                                               | -                  | -               |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 5521 Hellyer Avenue                                       | 1      | 203,800                        | 44%    | 44%    | Nanosolar, Inc.                                                                      | 89,040             | 710,512         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 6850 Santa Teresa Boulevard                               | 1      | 30,000                         | 41%    | 41%    | Bio-Medical Applications of CA                                                       | 12,350             | 125,645         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 6810 Santa Teresa Boulevard &180 Great Oaks Boulevard | 1      | 54,996                         | 87%    | 87%    | ZiLOG, Inc.                                                                          | 40,527             | 634,938         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 140-160 Great Oaks Boulevard &6781 Via Del Oro        | 2      | 105,300                        | 100%   | 88%    | Semiconductor Tooling ServicesInstant Asphalt, Inc.Santa Clara Valley Water District | 53,30026,57125,429 | 796,687         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 6540-6541 Via Del Oro &6385-6387 San Ignacio Avenue   | 2      | 66,600                         | 53%    | 50%    | Modutek Corporation                                                                  | 15,000             | 270,607         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 6311-6351 San Ignacio Avenue                              | 5      | 362,767                        | 52%    | 54%    | Saint GobainStion CorporationTeledex, LLC                                            | 95,95364,43530,000 | 3,215,061       |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 6320-6360 San Ignacio Avenue                              | 1      | 157,292                        | 0%     | 4%     | Vacant                                                                               | -                  | 123,780         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 75 East Trimble Road &2610 North First Street         | 2      | 170,810                        | 59%    | 59%    | Comerica, Inc.                                                                       | 93,984             | 1,197,222       |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 2904 Orchard Parkway                                      | 1      | 75,335                         | 100%   | 100%   | BAE Systems Land & Armaments                                                     | 75,335             | 1,258,095       |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 3236 Scott Boulevard                                      | 1      | 54,672                         | 100%   | 100%   | Mimix Broadband, Inc.                                                                | 54,672             | 759,267         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 1212 Bordeaux Lane                                        | 1      | 71,800                         | 100%   | 100%   | Loral Space & Communications, Inc.                                               | 71,800             | 744,006         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| McCandless Technology Park                                | 14     | 705,958                        | 13%    | 18%    | STATS ChipPAC, Inc.Rorze Automation, Inc.                                            | 33,98411,087       | 835,250         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 1600 Memorex Drive                                        | 1      | 107,500                        | 21%    | 21%    | International Network Services, Inc.                                                 | 22,800             | 231,366         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 1688 Richard Avenue                                       | 1      | 52,800                         | 100%   | 100%   | NWE Technology, Inc.                                                                 | 52,800             | 442,648         |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 1700 Richard Avenue                                       | 1      | 58,783                         | 100%   | 100%   | Silicon Valley Colocation, Inc.                                                      | 58,783             | 1,177,303       |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| Morgan Hill Land (4)                                      | -      | -                              | -      | -      | -                                                                                    | -                  | -               |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 300 Montague Expressway                                   | 1      | 49,457                         | 0%     | 0%     | Vacant                                                                               | -                  | 27,037          |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 337 Trade Zone Boulevard                                  | 1      | 42,912                         | 0%     | 0%     | Vacant                                                                               | -                  | -               |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| 324-368 Montague Expressway                               | 1      | 56,265                         | 0%     | 0%     | Vacant                                                                               | -                  | -               |
|                                                      |   |                           |   |   |                                                                                 |               |            |
| TOTAL                                                     | 111    | 8,047,569                      | 66%    |   |                                                                                 |               | $81,651,074     |

----

| (1)   | Annual cash rents do not include the recognition of rental income on the straight-line method of accounting required by accounting principles generally accepted in the United States of America (“GAAP”) under which contractual rent payment increases are recognized evenly over the lease term. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2)   | Joint venture properties. |
|-----------------|---------------------------|

| (3)   | Property represents a commitment by the Berg Group to construct an approximate 75,000 to 90,000 square foot building on land acquired during 2001. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------|

| (4)   | This property comprises of 55 acres of vacant land, which could support approximately 800,000 rentable square feet of space. The vacant land is currently zoned for industrial use and a portion has the potential to be rezoned for residential use. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   Year of Lease Expiration |  Number of Expiring Leases |  Rentable Square Footage Subject to Expiring Leases (1) |  2010 Annual Base Rent Under Expiring Leases (2) |  Percentage of Total Annual Base Rent Represented By Expiring Leases (3) |
|--------------------------------------|---------------------------------|--------------------------------------------------------------|-------------------------------------------------------|-------------------------------------------------------------------------------|
| 2010                                 | 9                               | 217,003                                                      | $2,155,923                                            | 2.6%                                                                     |
| 2011                                 | 17                              | 844,452                                                      | 13,107,735                                            | 15.7%                                                                    |
| 2012                                 | 14                              | 1,010,825                                                    | 15,486,191                                            | 18.5%                                                                    |
| 2013                                 | 6                               | 397,215                                                      | 5,431,036                                             | 6.5%                                                                     |
| 2014                                 | 17                              | 1,492,430                                                    | 26,537,863                                            | 31.8%                                                                    |
| 2015                                 | 7                               | 613,556                                                      | 9,784,061                                             | 11.7%                                                                    |
| 2016                                 | 3                               | 159,600                                                      | 3,421,710                                             | 4.1%                                                                     |
| 2017                                 | 5                               | 349,949                                                      | 4,888,985                                             | 5.9%                                                                     |
| Thereafter                           | 1                               | 119,756                                                      | 2,695,260                                             | 3.2%                                                                     |
|                                 |  79                        |  5,204,786                                              |  $83,508,764                                     |  100%                                                                    |

| (1)   | Excludes approximately 53,000 rentable square feet which are on month-to-month leases. |
|-----------------|----------------------------------------------------------------------------------------|

| (2)   | The base rent for expiring leases is based on 2010 scheduled cash rent, which is different than annual rent determined in accordance with GAAP. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------|

| (3)   | Based upon 2010 cash rent as discussed in Note (1). |
|-----------------|-----------------------------------------------------|

----

----

----

|        |   | 2009 |   |   | 2008   |   |
|-------------|--------|------|--------|--------|--------|--------|
|        |   | High |   |   | Low    |   |   | High |   |   | Low |   |
| 1st Quarter |   | $    | 7.66   |   |   | $      | 5.60 |   |   | $ | 10.13 |   |   | $ | 8.36 |   |
| 2nd Quarter |   | $    | 7.17   |   |   | $      | 6.21 |   |   | $ | 12.39 |   |   | $ | 9.45 |   |
| 3rd Quarter |   | $    | 7.07   |   |   | $      | 6.40 |   |   | $ | 11.36 |   |   | $ | 8.58 |   |
| 4th Quarter |   | $    | 7.31   |   |   | $      | 6.39 |   |   | $ | 9.27 |   |   | $ | 6.11 |   |

----

|        | 2009              |         |
|-------------|-------------------|--------------|
|        |  Record Date | Payment Date |   | Dividend Per Share |   |
| 1st Quarter | 03/31/09          | 04/09/09     |   | $ | 0.20 |   |
| 2nd Quarter | 06/30/09          | 07/09/09     |   |   | 0.15 |   |
| 3rd Quarter | 09/30/09          | 10/08/09     |   |   | 0.15 |   |
| 4th Quarter | 12/31/09          | 01/07/10     |   |   | 0.15 |   |
| Total       |              |         |   | $ | 0.65 |   |

|        | 2008              |         |
|-------------|-------------------|--------------|
|        |  Record Date | Payment Date |   | Dividend Per Share |   |
| 1st Quarter | 03/31/08          | 04/03/08     |   | $ | 0.20 |   |
| 2nd Quarter | 06/30/08          | 07/03/08     |   |   | 0.20 |   |
| 3rd Quarter | 09/30/08          | 10/09/08     |   |   | 0.20 |   |
| 4th Quarter | 12/31/08          | 01/08/09     |   |   | 0.20 |   |
| Total       |              |         |   | $ | 0.80 |   |

----

|                                                                                  |   | Year Ended December 31,                       |    |
|---------------------------------------------------------------------------------------|--------|-----------------------------------------------|---------|
|                                                                                  |   | 2009                                          |    |   | 2008 |   |   | 2007 |   |   | 2006 |   |   | 2005 |   |
|                                                                                  |   | (dollars in thousands, except per share data) |    |
| OPERATING INFORMATION: (1)                                                            |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating revenues:                                                                   |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |
|    Rental income                                                       |   | $                                             | 82,520  |   |   | $ | 79,075 |   |   | $ | 80,337 |   |   | $ | 91,457 |   |   | $ | 99,082 |   |
|    Above market lease intangible asset amortization                    |   |                                          | -       |   |   |   | - |   |   |   | (4,091 | ) |   |   | (1,888 | ) |   |   | (1,888 | ) |
|    Tenant reimbursements                                               |   |                                          | 18,732  |   |   |   | 16,406 |   |   |   | 13,355 |   |   |   | 13,061 |   |   |   | 14,030 |   |
|    Other income, including lease terminations and settlements          |   |                                          | 3,756   |   |   |   | 4,223 |   |   |   | 61,982 |   |   |   | 18,222 |   |   |   | 4,023 |   |
|      Total operating revenues                                |   |                                          | 105,008 |   |   |   | 99,704 |   |   |   | 151,583 |   |   |   | 120,852 |   |   |   | 115,247 |   |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating expenses:                                                                   |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Property operating, maintenance and real estate taxes               |   |                                          | 27,860  |   |   |   | 23,460 |   |   |   | 20,371 |   |   |   | 18,505 |   |   |   | 18,613 |   |
|    General and administrative                                          |   |                                          | 2,336   |   |   |   | 2,635 |   |   |   | 3,035 |   |   |   | 2,248 |   |   |   | 1,910 |   |
|    Depreciation and amortization                                       |   |                                          | 24,110  |   |   |   | 23,224 |   |   |   | 22,588 |   |   |   | 21,579 |   |   |   | 20,329 |   |
|      Total operating expenses                                |   |                                          | 54,306  |   |   |   | 49,319 |   |   |   | 45,994 |   |   |   | 42,332 |   |   |   | 40,852 |   |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      Operating income                                        |   |                                          | 50,702  |   |   |   | 50,385 |   |   |   | 105,589 |   |   |   | 78,520 |   |   |   | 74,395 |   |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other income (expenses):                                                              |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Equity in earnings of unconsolidated joint venture                  |   |                                          | 309     |   |   |   | 19,617 |   |   |   | 1,408 |   |   |   | 1,985 |   |   |   | 724 |   |
|    Interest and dividend income                                        |   |                                          | 1,309   |   |   |   | 1,735 |   |   |   | 3,086 |   |   |   | 2,344 |   |   |   | 567 |   |
|    Unrealized gain (loss) from investment                              |   |                                          | 5,011   |   |   |   | (278 | ) |   |   | - |   |   |   | - |   |   |   | - |   |
|    Interest expense                                                    |   |                                          | (22,117 | ) |   |   | (19,787 | ) |   |   | (20,131 | ) |   |   | (20,708 | ) |   |   | (21,294 | ) |
|    Interest expense – related parties                            |   |                                          | (765    | ) |   |   | (1,332 | ) |   |   | (724 | ) |   |   | (755 | ) |   |   | (972 | ) |
|      Income from continuing operations                       |   |                                          | 34,449  |   |   |   | 50,340 |   |   |   | 89,228 |   |   |   | 61,386 |   |   |   | 53,420 |   |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Discontinued operations:                                                              |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Net gain on disposal of discontinued operations (2)                 |   |                                          | -       |   |   |   | - |   |   |   | 6,529 |   |   |   | 18,102 |   |   |   | 2,206 |   |
|    Net income attributable to discontinued operations (2)              |   |                                          | -       |   |   |   | - |   |   |   | 91 |   |   |   | 1,500 |   |   |   | 1,925 |   |
|      Income from discontinued operations                     |   |                                          | -       |   |   |   | - |   |   |   | 6,620 |   |   |   | 19,602 |   |   |   | 4,131 |   |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                            |   |                                          | 34,449  |   |   |   | 50,340 |   |   |   | 95,848 |   |   |   | 80,988 |   |   |   | 57,551 |   |
| Net income attributable to noncontrolling interests                                   |   |                                          | (26,058 | ) |   |   | (40,206 | ) |   |   | (76,960 | ) |   |   | (66,358 | ) |   |   | (47,524 | ) |
| Net income available to common stockholders                                           |   | $                                             | 8,391   |   |   | $ | 10,134 |   |   | $ | 18,888 |   |   | $ | 14,630 |   |   | $ | 10,027 |   |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic net income per share from continuing operations                                 |   | $                                             | 0.39    |   |   | $ | 0.51 |   |   | $ | 0.90 |   |   | $ | 0.60 |   |   | $ | 0.51 |   |
| Diluted net income per share from continuing operations                               |   | $                                             | 0.38    |   |   | $ | 0.51 |   |   | $ | 0.89 |   |   | $ | 0.59 |   |   | $ | 0.51 |   |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic net income per share from discontinued operations                               |   |                                          | -       |   |   |   | - |   |   | $ | 0.06 |   |   | $ | 0.17 |   |   | $ | 0.04 |   |
| Diluted net income per share from discontinued operations                             |   |                                          | -       |   |   |   | - |   |   | $ | 0.06 |   |   | $ | 0.17 |   |   | $ | 0.04 |   |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic net income per share to common stockholders                                     |   | $                                             | 0.39    |   |   | $ | 0.51 |   |   | $ | 0.96 |   |   | $ | 0.77 |   |   | $ | 0.55 |   |
| Diluted net income per share to common stockholders                                   |   | $                                             | 0.38    |   |   | $ | 0.51 |   |   | $ | 0.95 |   |   | $ | 0.76 |   |   | $ | 0.55 |   |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| PROPERTY AND OTHER INFORMATION:                                                       |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      Total properties, end of period (3)                     |   |                                          | 111     |   |   |   | 111 |   |   |   | 109 |   |   |   | 107 |   |   |   | 107 |   |
|      Total rentable square feet, end of period (000’s) |   |                                          | 8,048   |   |   |   | 8,048 |   |   |   | 7,862 |   |   |   | 7,701 |   |   |   | 7,780 |   |
|      Average monthly rental income per square foot (4)  |   | $                                             | 1.30    |   |   | $ | 1.25 |   |   | $ | 1.42 |   |   | $ | 1.57 |   |   | $ | 1.58 |   |
|      Occupancy for leased properties, end of period          |   |                                          | 66      | % |   |   | 66 | % |   |   | 62 | % |   |   | 69 | % |   |   | 69 | % |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Dividends per share to common stockholders                                            |   | $                                             | 0.65    |   |   | $ | 0.80 |   |   | $ | 0.64 |   |   | $ | 0.64 |   |   | $ | 0.64 |   |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Funds from operations (5)                                                             |   | $                                             | 60,467  |   |   | $ | 55,334 |   |   | $ | 114,867 |   |   | $ | 86,585 |   |   | $ | 79,152 |   |
| Funds from operations per share (5) (6)                                               |   | $                                             | 0.57    |   |   | $ | 0.52 |   |   | $ | 1.09 |   |   | $ | 0.83 |   |   | $ | 0.76 |   |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| CASH FLOW INFORMATION:                                                                |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      Cash flows provided by operating activities             |   | $                                             | 56,072  |   |   | $ | 76,872 |   |   | $ | 78,814 |   |   | $ | 82,630 |   |   | $ | 69,422 |   |
|      Cash flows used in investing activities                 |   | $                                             | (278    | ) |   | $ | (26,496 | ) |   | $ | (8,548 | ) |   | $ | (5,369 | ) |   | $ | (2,875 | ) |
|      Cash flows (used in) provided by financing activities   |   | $                                             | (54,808 | ) |   | $ | (74,067 | ) |   | $ | (80,360 | ) |   | $ | (74,917 | ) |   | $ | 31,441 |   |
|                                                                                  |   |                                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

|                                                                                                   |   |                   |       |   |   |   |       |   |   |   |       |   |   |   |       |   |   |   |       |   |
|--------------------------------------------------------------------------------------------------------|--------|------------------------|------------|--------|--------|--------|------------|--------|--------|--------|------------|--------|--------|--------|------------|--------|--------|--------|------------|--------|
|                                                                                                   |   |                   |       |   |   |   |       |   |   |   |       |   |   |   |       |   |   |   |       |   |
|                                                                                                   |   | December 31,           |       |
|                                                                                                   |   |                   | 2009       |   |   |   | 2008       |   |   |   | 2007       |   |   |   | 2006       |   |   |   | 2005       |   |
|                                                                                                   |   | (dollars in thousands) |       |
|      BALANCE SHEET INFORMATION:                                               |   |                   |       |   |   |   |       |   |   |   |       |   |   |   |       |   |   |   |       |   |
|      Net investments in properties                                            |   | $                      | 919,647    |   |   | $      | 943,579    |   |   | $      | 922,117    |   |   | $      | 898,889    |   |   | $      | 927,381    |   |
|      Total assets                                                             |   | $                      | 986,389    |   |   | $      | 1,034,285  |   |   | $      | 1,053,885  |   |   | $      | 1,027,487  |   |   | $      | 1,023,377  |   |
|      Mortgage notes payable                                                   |   | $                      | 318,818    |   |   | $      | 330,908    |   |   | $      | 337,520    |   |   | $      | 348,101    |   |   | $      | 357,481    |   |
|      Mortgage note payable – related parties                            |   | $                      | 8,261      |   |   | $      | 8,761      |   |   | $      | 9,224      |   |   | $      | 9,654      |   |   | $      | 10,051     |   |
|      Note payable – related parties                                     |   | $                      | 9,325      |   |   |   | -          |   |   |   | -          |   |   |   | -          |   |   |   | -          |   |
|      Revolving line of credit                                                 |   | $                      | 14,466     |   |   | $      | 13,079     |   |   |   | -          |   |   |   | -          |   |   |   | -          |   |
|      Total liabilities                                                        |   | $                      | 389,260    |   |   | $      | 402,382    |   |   | $      | 388,581    |   |   | $      | 397,327    |   |   | $      | 407,680    |   |
|      Stockholders’ equity attributable to Mission West Properties, Inc. |   | $                      | 144,844    |   |   | $      | 134,418    |   |   | $      | 138,678    |   |   | $      | 128,878    |   |   | $      | 115,015    |   |
|      Noncontrolling interests in operating partnerships                       |   | $                      | 452,285    |   |   | $      | 497,485    |   |   | $      | 526,626    |   |   | $      | 501,282    |   |   | $      | 500,682    |   |
|      Common stock outstanding                                                 |   |                   | 21,870,211 |   |   |   | 19,748,211 |   |   |   | 19,664,087 |   |   |   | 19,443,587 |   |   |   | 18,448,791 |   |
|      O.P. Units issued and outstanding                                        |   |                   | 83,404,965 |   |   |   | 85,526,965 |   |   |   | 85,533,935 |   |   |   | 85,206,199 |   |   |   | 86,088,095 |   |

| (1)   | Certain reclassifications have been made to prior period amounts in order to conform to current period presentation. |
|-----------------|----------------------------------------------------------------------------------------------------------------------|

| (2)   | The operating results of real estate held for sale and sold are reported as discontinued operations for all years presented. Additionally, all gains and losses on the sale of assets classified as held for sale are included in discontinued operations. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3)   | As of December 31, 2009, 2008, 2007, 2006 and 2005, total properties include a property at 245 Caspian in Sunnyvale with no building. In 2001, we paid the Berg Group approximately $7.5 million for their commitment to complete an approximate 75,000 to 90,000 square foot building on the property. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4)   | Average monthly rental income per square foot has been determined by taking the total cash base rent for the period divided by the number of months in the period, and then divided by the average occupied square feet in the period. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (5)   | Funds from Operations (“FFO”) is a non-GAAP financial term used by REITs to measure and compare operating performance. As defined by the National Association of Real Estate Investment Trusts (“NAREIT”), FFO represents net income (loss) (computed in accordance with GAAP), including non-recurring events other than “extraordinary items” under GAAP and excluding gains and losses from sales of discontinued operations or depreciable operating properties, plus real estate related depreciation and amortization (excluding amortization of deferred financing costs and depreciation of non-real estate assets) and after adjustments for unconsolidated partnerships and joint ventures. FFO does include impairment losses for properties held for sale and held for use. Additionally, our 2009, 2008, 2007, 2006 and 2005 FFO calculation includes our portion of the depreciation and amortization of real estate from our unconsolidated joint venture, but excludes the above-market lease intangible asset, which was recorded as a reduction of revenues. Management considers FFO to be an appropriate supplemental measure of our operating and financial performance because when compared year over year, it reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, general and administrative expenses and interest costs, providing a perspective not immediately apparent from net income. In addition, management believes that FFO provides useful information about our financial performance when compared to other REITs because FFO is generally recognized as the industry standard for reporting the operations of REITs. FFO should neither be considered as an alternative for neither net income as a measure of profitability nor is it comparable to cash flows provided by operating activities determined in accordance with GAAP. FFO is not comparable to similarly entitled items reported by other REITs that do not define them exactly as we define FFO. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (6)   | Considering the potential effect of all O.P. Units being exchanged for shares of our common stock. |
|-----------------|----------------------------------------------------------------------------------------------------|

|                                                                    |   | Year Ended December 31,                       |        |
|-------------------------------------------------------------------------|--------|-----------------------------------------------|-------------|
|                                                                    |   | 2009                                          |        |   | 2008 |   |   | 2007 |   |   | 2006 |   |   | 2005 |   |
|                                                                    |   | (dollars in thousands, except per share data) |        |
| Net income                                                              |   | $                                             | 34,449      |   |   | $ | 50,340 |   |   | $ | 95,848 |   |   | $ | 80,988 |   |   | $ | 57,551 |   |
| Add:                                                                    |   |                                          |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Depreciation and amortization (1)               |   |                                          | 26,425      |   |   |   | 25,833 |   |   |   | 26,050 |   |   |   | 24,636 |   |   |   | 24,286 |   |
| Less:                                                                   |   |                                          |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Gain on sales of assets or joint venture assets |   |                                          | -           |   |   |   | (20,471 | ) |   |   | (6,529 | ) |   |   | (18,540 | ) |   |   | (2,206 | ) |
|     Noncontrolling interests of joint ventures      |   |                                          | (407        | ) |   |   | (368 | ) |   |   | (502 | ) |   |   | (499 | ) |   |   | (479 | ) |
| FFO                                                                     |   | $                                             | 60,467      |   |   | $ | 55,334 |   |   | $ | 114,867 |   |   | $ | 86,585 |   |   | $ | 79,152 |   |
|                                                                    |   |                                          |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted average common shares and O.P. Units - diluted                 |   |                                          | 105,461,581 |   |   |   | 105,524,677 |   |   |   | 105,016,651 |   |   |   | 104,809,155 |   |   |   | 104,545,776 |   |
| FFO per common share and O.P. Unit - diluted                            |   | $                                             | 0.57        |   |   | $ | 0.52 |   |   | $ | 1.09 |   |   | $ | 0.83 |   |   | $ | 0.76 |   |

| (1)   | Also includes our portion of depreciation and amortization of real estate from our unconsolidated joint venture totaling approximately $238, $900, $757, $849 and $984 in 2009, 2008, 2007, 2006 and 2005, respectively, and amortization of leasing commissions totaling approximately $2,077, $1,709, $2,558, $1,513 and $1,703 in 2009, 2008, 2007, 2006 and 2005, respectively. Amortization of leasing commissions is included in the property operating, maintenance and real estate taxes line item in our consolidated statements of operations. (dollars in thousands) |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ·   | the current turmoil in the credit markets; |
|--------------------|--------------------------------------------|

| ·   | economic conditions generally and the real estate market specifically; |
|--------------------|------------------------------------------------------------------------|

| ·   | the occupancy rates of the properties; |
|--------------------|----------------------------------------|

| ·   | rental rates on new and renewed leases; |
|--------------------|-----------------------------------------|

| ·   | tenant improvement and leasing costs incurred to obtain and retain tenants; |
|--------------------|-----------------------------------------------------------------------------|

| ·   | operating expenses; |
|--------------------|---------------------|

| ·   | cost and availability of capital; |
|--------------------|-----------------------------------|

| ·   | interest rates; |
|--------------------|-----------------|

| ·   | the extent of acquisitions and sales of real estate; |
|--------------------|------------------------------------------------------|

| ·   | legislative or regulatory provisions (including changes to laws governing the taxation of REITs); |
|--------------------|---------------------------------------------------------------------------------------------------|

| ·   | competition; |
|--------------------|--------------|

| ·   | supply of and demand for R&D, office and industrial properties in our current and proposed market areas; |
|--------------------|--------------------------------------------------------------------------------------------------------------|

| ·   | tenant defaults and bankruptcies; |
|--------------------|-----------------------------------|

| ·   | lease term expirations and renewals; |
|--------------------|--------------------------------------|

| ·   | changes in general accounting principles, policies and guidelines applicable to REITs; and |
|--------------------|--------------------------------------------------------------------------------------------|

| ·   | ability to timely refinance maturing debt obligations and the terms of any such refinancing. |
|--------------------|----------------------------------------------------------------------------------------------|

----

----

| ·   | the agreement has been fully executed and delivered; |
|--------------------|------------------------------------------------------|

| ·   | services have been rendered; |
|--------------------|------------------------------|

| ·   | the amount is fixed and determinable; and |
|--------------------|-------------------------------------------|

| ·   | collectability is reasonably assured. |
|--------------------|---------------------------------------|

----

|                                |   | Year Ended December 31, |   |   |   |   |   |     |   |
|-------------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                                |   | 2009                    |   |   | 2008   |   |   | $ Change |   |   | % Change |   |
|                                |   | (dollars in thousands)  |   |   |   |   |
| Same Property (1)                   |   | $                       | 81,209 |   |   | $      | 77,982 |     |   | $ | 3,227 |   |   |   | 4.1% |   |
| 2008 Acquisitions (2)               |   |                    | 1,311  |   |   |   | 1,093  |     |   |   | 218 |   |   |   | 19.9% |   |
|      Total |   | $                       | 82,520 |   |   | $      | 79,075 |     |   | $ | 3,445 |   |   |   | 4.4% |   |

| (1)   | “Same Property” is defined as properties owned by us prior to 2008 that we still owned as of December 31, 2009. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------|

| (2)   | Operating rental income for 2008 Acquisitions does not reflect a full 12 months of operations in 2008 because these properties were acquired at various times during the year. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|         |   | Year Ended December 31, |   |   |   |   |   |     |   |
|--------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|         |   | 2009                    |   |   | 2008   |   |   | $ Change |   |   | % Change |   |
|         |   | (dollars in thousands)  |   |   |   |   |
| Other income |   | $                       | 3,756  |   |   | $      | 4,223  |     |   | $ | (467 | ) |   |   | (11.1% | ) |

----

|                                |   | Year Ended December 31, |   |   |   |   |   |     |   |
|-------------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                                |   | 2009                    |   |   | 2008   |   |   | $ Change |   |   | % Change |   |
|                                |   | (dollars in thousands)  |   |   |   |   |
| Same Property (1)                   |   | $                       | 27,560 |   |   | $      | 23,285 |     |   | $ | 4,275 |   |   |   | 18.4% |   |
| 2008 Acquisitions (2)               |   |                    | 300    |   |   |   | 175    |     |   |   | 125 |   |   |   | 71.4% |   |
|      Total |   | $                       | 27,860 |   |   | $      | 23,460 |     |   | $ | 4,400 |   |   |   | 18.8% |   |

| (1)   | “Same Property” is defined as properties owned by us prior to 2008 that we still owned as of December 31, 2009. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------|

| (2)   | Operating expenses for 2008 Acquisitions do not reflect a full 12 months of operations in 2008 because these properties were acquired at various times during the year. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                       |   | Year Ended December 31, |   |   |   |   |   |     |   |
|----------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                       |   | 2009                    |   |   | 2008   |   |   | $ Change |   |   | % Change |   |
|                       |   | (dollars in thousands)  |   |   |   |   |
| General and administrative |   | $                       | 2,336  |   |   | $      | 2,635  |     |   | $ | (299 | ) |   |   | (11.3% | ) |

|                          |   | Year Ended December 31, |   |   |   |   |   |     |   |
|-------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                          |   | 2009                    |   |   | 2008   |   |   | $ Change |   |   | % Change |   |
|                          |   | (dollars in thousands)  |   |   |   |   |
| Depreciation and amortization |   | $                       | 24,110 |   |   | $      | 23,224 |     |   | $ | 886 |   |   |   | 3.8% |   |

|                                               |   | Year Ended December 31, |   |   |   |   |   |     |   |
|----------------------------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                                               |   | 2009                    |   |   | 2008   |   |   | $ Change |   |   | % Change |   |
|                                               |   | (dollars in thousands)  |   |   |   |   |
| Equity in earnings of unconsolidated joint venture |   | $                       | 309    |   |   | $      | 19,617 |     |   | $ | (19,308 | ) |   |   | (98.4% | ) |

----

|                         |   | Year Ended December 31, |   |   |   |   |   |     |   |
|------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                         |   | 2009                    |   |   | 2008   |   |   | $ Change |   |   | % Change |   |
|                         |   | (dollars in thousands)  |   |   |   |   |
| Interest and dividend income |   | $                       | 1,309  |   |   | $      | 1,735  |     |   | $ | (426 | ) |   |   | (24.6% | ) |

|                                |   | Year Ended December 31, |   |   |   |   |   |     |   |
|-------------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                                |   | 2009                    |   |   | 2008   |   |   | $ Change |   |   | % Change |   |
|                                |   | (dollars in thousands)  |   |   |   |   |
| Interest                            |   | $                       | 22,117 |   |   | $      | 19,787 |     |   | $ | 2,330 |   |   |   | 11.8% |   |
| Interest (related parties)          |   |                    | 765    |   |   |   | 1,332  |     |   |   | (567 | ) |   |   | (42.6% | ) |
|      Total |   | $                       | 22,882 |   |   | $      | 21,119 |     |   | $ | 1,763 |   |   |   | 8.3% |   |

|                                           |   | Year Ended December 31, |   |   |   |   |   |     |   |
|------------------------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                                           |   | 2009                    |   |   | 2008   |   |   | $ Change |   |   | % Change |   |
|                                           |   | (dollars in thousands)  |   |   |   |   |
| Net income to common stockholders              |   | $                       | 8,391  |   |   | $      | 10,134 |     |   | $ | (1,743 | ) |   |   | (17.2% | ) |
| Net income to noncontrolling interests         |   |                    | 26,058 |   |   |   | 40,206 |     |   |   | (14,148 | ) |   |   | (35.2% | ) |
|      Total net income |   | $                       | 34,449 |   |   | $      | 50,340 |     |   | $ | (15,891 | ) |   |   | (31.6% | ) |

----

|                                |   | Year Ended December 31, |   |   |   |   |   |     |   |
|-------------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                                |   | 2008                    |   |   | 2007   |   |   | $ Change |   |   | % Change |   |
|                                |   | (dollars in thousands)  |   |   |   |   |
| Same Property (1)                   |   | $                       | 75,653 |   |   | $      | 80,282 |     |   | $ | (4,629 | ) |   |   | (5.8% | ) |
| 2007 Acquisitions (2)               |   |                    | 33     |   |   |   | 55     |     |   |   | (22 | ) |   |   | (40% | ) |
| 2008 Acquisitions (3)               |   |                    | 3,389  |   |   |   | -      |     |   |   | 3,389 |   |   |   | 100% |   |
|      Total |   | $                       | 79,075 |   |   | $      | 80,337 |     |   | $ | (1,262 | ) |   |   | (1.6% | ) |

| (1)   | “Same Property” is defined as properties owned by us prior to 2007 that we still owned as of December 31, 2008. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------|

| (2)   | Operating rental income for 2007 Acquisitions does not reflect a full 12 months of operations in 2007 because these properties were acquired at various times during the year. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3)   | Operating rental income for 2008 Acquisitions does not reflect a full 12 months of operations in 2008 because these properties were acquired at various times during the year. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|         |   | Year Ended December 31, |   |   |   |   |   |     |   |
|--------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|         |   | 2008                    |   |   | 2007   |   |   | $ Change |   |   | % Change |   |
|         |   | (dollars in thousands)  |   |   |   |   |
| Other income |   | $                       | 4,223  |   |   | $      | 61,982 |     |   | $ | (57,759 | ) |   |   | (93.2% | ) |

|                                |   | Year Ended December 31, |   |   |   |   |   |     |   |
|-------------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                                |   | 2008                    |   |   | 2007   |   |   | $ Change |   |   | % Change |   |
|                                |   | (dollars in thousands)  |   |   |   |   |
| Same Property (1)                   |   | $                       | 22,657 |   |   | $      | 20,107 |     |   | $ | 2,550 |   |   |   | 12.7% |   |
| 2007 Acquisitions (2)               |   |                    | 403    |   |   |   | 264    |     |   |   | 139 |   |   |   | 52.7% |   |
| 2008 Acquisitions (3)               |   |                    | 400    |   |   |   | -      |     |   |   | 400 |   |   |   | 100% |   |
|      Total |   | $                       | 23,460 |   |   | $      | 20,371 |     |   | $ | 3,089 |   |   |   | 15.2% |   |

| (1)   | “Same Property” is defined as properties owned by us prior to 2007 that we still owned as of December 31, 2008. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------|

| (2)   | Operating expenses for 2007 Acquisitions do not reflect a full 12 months of operations in 2007 because these properties were acquired at various times during the year. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3)   | Operating expenses for 2008 Acquisitions do not reflect a full 12 months of operations in 2008 because these properties were acquired at various times during the year. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                       |   | Year Ended December 31, |   |   |   |   |   |     |   |
|----------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                       |   | 2008                    |   |   | 2007   |   |   | $ Change |   |   | % Change |   |
|                       |   | (dollars in thousands)  |   |   |   |   |
| General and administrative |   | $                       | 2,635  |   |   | $      | 3,035  |     |   | $ | 400 |   |   |   | (13.2% | ) |

|                          |   | Year Ended December 31, |   |   |   |   |   |     |   |
|-------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                          |   | 2008                    |   |   | 2007   |   |   | $ Change |   |   | % Change |   |
|                          |   | (dollars in thousands)  |   |   |   |   |
| Depreciation and amortization |   | $                       | 23,224 |   |   | $      | 22,588 |     |   | $ | 636 |   |   |   | 2.8% |   |

|                                               |   | Year Ended December 31, |   |   |   |   |   |     |   |
|----------------------------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                                               |   | 2008                    |   |   | 2007   |   |   | $ Change |   |   | % Change |   |
|                                               |   | (dollars in thousands)  |   |   |   |   |
| Equity in earnings of unconsolidated joint venture |   | $                       | 19,617 |   |   | $      | 1,408  |     |   | $ | 18,209 |   |   |   | 1,293.3% |   |

|                         |   | Year Ended December 31, |   |   |   |   |   |     |   |
|------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                         |   | 2008                    |   |   | 2007   |   |   | $ Change |   |   | % Change |   |
|                         |   | (dollars in thousands)  |   |   |   |   |
| Interest and dividend income |   | $                       | 1,735  |   |   | $      | 3,086  |     |   | $ | (1,351 | ) |   |   | (43.8% | ) |

----

|                                |   | Year Ended December 31, |   |   |   |   |   |     |   |
|-------------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                                |   | 2008                    |   |   | 2007   |   |   | $ Change |   |   | % Change |   |
|                                |   | (dollars in thousands)  |   |   |   |   |
| Interest                            |   | $                       | 19,787 |   |   | $      | 20,131 |     |   | $ | (344 | ) |   |   | (1.7% | ) |
| Interest (related parties)          |   |                    | 1,332  |   |   |   | 724    |     |   |   | 608 |   |   |   | 84% |   |
|      Total |   | $                       | 21,119 |   |   | $      | 20,855 |     |   | $ | 264 |   |   |   | 1.3% |   |

|                                                              |   | Year Ended December 31, |   |
|-------------------------------------------------------------------|--------|-------------------------|--------|
|                                                              |   | 2008                    |   |   | 2007 |   |
|                                                              |   | (dollars in thousands)  |   |
| Net gain on disposal of discontinued operations                   |   |                    | -      |   |   | $ | 6,529 |   |
| Net income attributable to discontinued operations                |   |                    | -      |   |   |   | 91 |   |
|      Income from discontinued operations |   |                    | -      |   |   | $ | 6,620 |   |

|                                           |   | Year Ended December 31, |   |   |   |   |   |     |   |
|------------------------------------------------|--------|-------------------------|--------|--------|--------|--------|--------|----------|--------|
|                                           |   | 2008                    |   |   | 2007   |   |   | $ Change |   |   | % Change |   |
|                                           |   | (dollars in thousands)  |   |   |   |   |
| Net income to common stockholders              |   | $                       | 10,134 |   |   | $      | 18,888 |     |   | $ | (8,754 | ) |   |   | (46.3% | ) |
| Net income to noncontrolling interests         |   |                    | 40,206 |   |   |   | 76,960 |     |   |   | (36,754 | ) |   |   | (47.8% | ) |
|      Total net income |   | $                       | 50,340 |   |   | $      | 95,848 |     |   | $ | (45,508 | ) |   |   | (47.5% | ) |

----

----

----

|                                     |   | 2010   |   |   | 2011   |   |   | 2012   |   |   | 2013   |   |   | 2014   |   |   | Thereafter |   |   | Total  |   |
|------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|------------|--------|--------|--------|--------|
| Principal payments (1)              |   | $      | 22,653 |   |   | $      | 28,575 |   |   | $      | 14,935 |   |   | $      | 81,269 |   |       | $      | 10,891 |   |   | $ | 192,547 |   |   | $ | 350,870 |   |
| Interest payments-fixed rate debt (2)    |   |   | 18,433 |   |   |   | 17,652 |   |   |   | 16,825 |   |   |   | 12,820 |   |       |   | 11,366 |   |   |   | 62,288 |   |   |   | 139,384 |   |
| Interest payments-variable rate debt (3) |   |   | 809    |   |   |   | -      |   |   |   | -      |   |   |   | -      |   |       |   | -      |   |   |   | - |   |   |   | 809 |   |
| Operating lease obligations (4)     |   |   | 120    |   |   |   | 30     |   |   |   | -      |   |   |   | -      |   |       |   | -      |   |   |   | - |   |   |   | 150 |   |
|    Total                  |   | $      | 42,015 |   |   | $      | 46,257 |   |   | $      | 31,760 |   |   | $      | 94,089 |   |       | $      | 22,257 |   |   | $ | 254,835 |   |   | $ | 491,213 |   |

| (1)   | As of December 31, 2009, 93.2% of our debt was contractually fixed and 6.8% of our debt bore interest at variable rates. Our debt obligations are set forth in detail in the table below. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2)   | The information in the table above reflects our projected interest rate obligations for the fixed-rate payments based on the contractual interest rates, interest payment dates and scheduled maturity dates. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3)   | The information in the table above reflects our projected interest rate obligations for the variable-rate payments based on 4.00% and LIBOR plus a 1.75% spread at December 31, 2009, the scheduled interest payment dates and maturity dates. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4)   | Our operating lease obligations relate to a lease of our corporate office facility from a related party. |
|-----------------|----------------------------------------------------------------------------------------------------------|

|                                       |   | Year Ended December 31, |    |
|--------------------------------------------|--------|-------------------------|---------|
|                                       |   | 2009                    |    |   | 2008 |   |   | 2007 |   |
|                                       |   | (dollars in thousands)  |    |
| Cash flow provided by operating activities |   | $                       | 56,072  |   |   | $ | 76,872 |   |   | $ | 78,814 |   |
| Cash flow used in investing activities     |   | $                       | (278    | ) |   | $ | (26,496 | ) |   | $ | (8,548 | ) |
| Cash flow used in financing activities     |   | $                       | (54,808 | ) |   | $ | (74,067 | ) |   | $ | (80,360 | ) |

----

----

| ·   | so long as the Berg Group members and their affiliates, other than us and the operating partnerships, beneficially own, in the aggregate, at least 15% of the outstanding shares of common stock on a Fully Diluted basis, the approval of a majority of our directors, including Carl E. Berg or his designee as a director, and of the holders of a majority of the O.P. Units is required for us to take title to assets, other than temporarily in connection with an acquisition prior to contributing such assets to the operating partnerships, or to conduct business other than through the operating partnerships, or for us or the operating partnerships to engage in any business other than the ownership, construction, development and operation of real estate properties, or for certain fundamental corporate actions, including amendments to our charter, bylaws or any operating partnership agreement and any merger, consolidation or sale of all or substantially all of our assets or the assets of the operating partnerships; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | changes in certain policies with respect to conflicts of interest must be consistent with legal requirements; |
|--------------------|---------------------------------------------------------------------------------------------------------------|

| ·   | certain policies with respect to competition by and acquisitions from the Berg Group are imposed pursuant to provisions of the acquisition agreement that cannot be amended or waived without the approval of the Independent Directors Committee of our Board of Directors; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | we cannot take any action intended to terminate our qualification as a REIT without the approval of more than 75% of the entire Board of Directors; and |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | we cannot undertake certain other specified transactions, including the issuance of debt securities, and borrowings in excess of specified limits, or the amendment of our charter and bylaws, without the approval of more than 75% of the entire Board of Directors. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|                           | 2010                   | 2011    | 2012    | 2013    | 2014    | Thereafter | Total    | Fair Value |
|--------------------------------|------------------------|---------|---------|---------|---------|------------|----------|------------|
|                           | (dollars in thousands) |
| Fixed Rate Debt:               |                   |    |    |    |    |       |     |       |
| Secured notes payable          | $13,328                | $14,109 | $14,935 | $81,269 | $10,891 | $192,547   | $327,079 | $318,375   |
| Weighted average interest rate | 5.74%                  | 5.74%   | 5.74%   | 5.74%   | 5.74%   | 5.74%      |     |       |
|                           |                   |    |    |    |    |       |     |       |
| Variable Rate Debt:            |                   |    |    |    |    |       |     |       |
| Unsecured debt                 | $9,325                 | -       | -       | -       | -       | -          | $9,325   | $9,325     |
| Weighted average interest rate | 1.98%                  | -       | -       | -       | -       | -          |     |       |
|                           |                   |    |    |    |    |       |     |       |
| Secured debt                   | -                      | $14,466 | -       | -       | -       | -          | $14,466  | $14,466    |
| Weighted average interest rate | -                      | 4.00%   | -       | -       | -       | -          |     |       |

----

|                                                                                                      | PAGE   |
|-----------------------------------------------------------------------------------------------------------|--------|
| Report of Independent Registered Public Accounting Firm                                              | 42     |
| Report of Independent Registered Public Accounting Firm on Internal Control over Financial Reporting | 43     |
| Consolidated Balance Sheets as of December 31, 2009 and 2008                                              | 44     |
| Consolidated Statements of Operations for the years ended December 31, 2009, 2008 and 2007                | 45     |
| Consolidated Statements of Equity for the years ended December 31, 2009, 2008 and 2007                    | 46     |
| Consolidated Statements of Cash Flows for the years ended December 31, 2009, 2008 and 2007                | 47     |
| Notes to Consolidated Financial Statements                                                                | 48     |
| Supplemental Financial Information                                                                        | 71     |
| Report of Independent Registered Public Accounting Firm  on Financial Statement Schedule   | 73     |
| Schedule III: Real Estate and Accumulated Depreciation as of December 31, 2009                            | 75     |
| Schedule III: Real Estate and Accumulated Depreciation as of December 31, 2008                            | 77     |
|                                                                                                      |   |
|                                                                                                      |   |
|                                                                                                      |   |
|                                                                                                      |   |
|                                                                                                      |   |
|                                                                                                      |   |
|                                                                                                      |   |
|                                                                                                      |   |
|                                                                                                      |   |

----

----

----

| ASSETS                                                                                                                         |   |
|--------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                           |   | December 31, |   |
|                                                                                                                           |   | 2009 |   |   | 2008 |   |
| Investments in real estate:                                                                                                    |   |   |   |   |   |   |
|   Land                                                                                                               |   | $ | 320,911 |   |   | $ | 320,911 |   |
|   Buildings and improvements                                                                                         |   |   | 799,649 |   |   |   | 799,471 |   |
|   Real estate related intangible assets                                                                              |   |   | 3,240 |   |   |   | 3,240 |   |
|       Total investments in properties                                                            |   |   | 1,123,800 |   |   |   | 1,123,622 |   |
|   Accumulated depreciation and amortization                                                                          |   |   | (204,153 | ) |   |   | (180,043 | ) |
|       Net investments in properties                                                              |   |   | 919,647 |   |   |   | 943,579 |   |
|   Investment in unconsolidated joint venture                                                                         |   |   | 3,828 |   |   |   | 3,768 |   |
|       Net investments in real estate                                                             |   |   | 923,475 |   |   |   | 947,347 |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |
| Cash and cash equivalents                                                                                                      |   |   | 986 |   |   |   | - |   |
| Restricted cash                                                                                                                |   |   | 197 |   |   |   | 39,478 |   |
| Restricted investment in marketable securities                                                                                 |   |   | 12,069 |   |   |   | - |   |
| Investment in marketable securities                                                                                            |   |   | - |   |   |   | 3,368 |   |
| Deferred rent receivables                                                                                                      |   |   | 18,711 |   |   |   | 17,841 |   |
| Other assets, net                                                                                                              |   |   | 30,951 |   |   |   | 26,251 |   |
|       Total assets                                                                               |   | $ | 986,389 |   |   | $ | 1,034,285 |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |
| LIABILITIES AND EQUITY                                                                                                         |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |
| Liabilities:                                                                                                                   |   |   |   |   |   |   |   |   |
|   Mortgage notes payable                                                                                             |   | $ | 318,818 |   |   | $ | 330,908 |   |
|   Mortgage note payable (related parties)                                                                            |   |   | 8,261 |   |   |   | 8,761 |   |
|   Note payable (related parties)                                                                                     |   |   | 9,325 |   |   |   | - |   |
|   Revolving line of credit                                                                                           |   |   | 14,466 |   |   |   | 13,079 |   |
|   Interest payable                                                                                                   |   |   | 1,573 |   |   |   | 1,596 |   |
|   Security deposits                                                                                                  |   |   | 4,849 |   |   |   | 5,272 |   |
|   Deferred rental income                                                                                             |   |   | 6,539 |   |   |   | 3,964 |   |
|   Dividends and distributions payable                                                                                |   |   | 15,791 |   |   |   | 21,055 |   |
|   Accounts payable and accrued expenses                                                                              |   |   | 9,638 |   |   |   | 17,747 |   |
|       Total liabilities                                                                          |   |   | 389,260 |   |   |   | 402,382 |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |
| Commitments and contingencies (Note 16)                                                                                        |   |   |   |   |   |   |   |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |
| Equity:                                                                                                                        |   |   |   |   |   |   |   |   |
|   Stockholders’ equity attributable to Mission West Properties, Inc.:                                          |   |   |   |   |   |   |   |   |
|     Preferred stock, $.001 par value, 20,000,000 shares authorized,                                        |   |   |   |   |   |   |   |   |
|         none issued or outstanding                                                     |   |   | - |   |   |   | - |   |
|     Common stock, $.001 par value, 200,000,000 shares authorized, 21,870,211                               |   |   |   |   |   |   |   |   |
|         and 19,748,211 shares issued and outstanding at December 31, 2009 and 2008     |   |   | 22 |   |   |   | 20 |   |
|     Additional paid-in capital                                                                             |   |   | 170,606 |   |   |   | 154,412 |   |
|     Distributions in excess of accumulated earnings                                                        |   |   | (25,784 | ) |   |   | (20,014 | ) |
|         Total stockholders’ equity attributable to Mission West Properties, Inc. |   |   | 144,844 |   |   |   | 134,418 |   |
|   Noncontrolling interests in operating partnerships                                                                 |   |   | 452,285 |   |   |   | 497,485 |   |
|       Total equity                                                                               |   |   | 597,129 |   |   |   | 631,903 |   |
|       Total liabilities and equity                                                               |   | $ | 986,389 |   |   | $ | 1,034,285 |   |

----

|                                                                                 |   | Year Ended December 31, |       |
|--------------------------------------------------------------------------------------|--------|-------------------------|------------|
|                                                                                 |   | 2009                    |       |   | 2008 |   |   | 2007 |   |
| Operating revenues:                                                                  |   |                    |       |   |   |   |   |   |   |
|   Rental income                                                            |   | $                       | 82,520     |   |   | $ | 79,075 |   |   | $ | 80,337 |   |
|   Above market lease intangible asset amortization                         |   |                    | -          |   |   |   | - |   |   |   | (4,091 | ) |
|   Tenant reimbursements                                                    |   |                    | 18,732     |   |   |   | 16,406 |   |   |   | 13,355 |   |
|   Other income, including lease terminations and settlements               |   |                    | 3,756      |   |   |   | 4,223 |   |   |   | 61,982 |   |
|        Total operating revenues                   |   |                    | 105,008    |   |   |   | 99,704 |   |   |   | 151,583 |   |
|                                                                                 |   |                    |       |   |   |   |   |   |   |   |   |   |
| Operating expenses:                                                                  |   |                    |       |   |   |   |   |   |   |   |   |   |
|   Property operating, maintenance and real estate taxes                    |   |                    | 27,860     |   |   |   | 23,460 |   |   |   | 20,371 |   |
|   General and administrative                                               |   |                    | 2,336      |   |   |   | 2,635 |   |   |   | 3,035 |   |
|   Depreciation and amortization                                            |   |                    | 24,110     |   |   |   | 23,224 |   |   |   | 22,588 |   |
|        Total operating expenses                   |   |                    | 54,306     |   |   |   | 49,319 |   |   |   | 45,994 |   |
|                                                                                 |   |                    |       |   |   |   |   |   |   |   |   |   |
|        Operating income                           |   |                    | 50,702     |   |   |   | 50,385 |   |   |   | 105,589 |   |
|                                                                                 |   |                    |       |   |   |   |   |   |   |   |   |   |
| Other income (expenses):                                                             |   |                    |       |   |   |   |   |   |   |   |   |   |
|   Equity in earnings of unconsolidated joint venture                       |   |                    | 309        |   |   |   | 19,617 |   |   |   | 1,408 |   |
|   Interest and dividend income                                             |   |                    | 1,309      |   |   |   | 1,735 |   |   |   | 3,086 |   |
|   Unrealized gain (loss) from investment in marketable securities          |   |                    | 5,011      |   |   |   | (278 | ) |   |   | - |   |
|   Interest expense                                                         |   |                    | (22,117    | ) |   |   | (19,787 | ) |   |   | (20,131 | ) |
|   Interest expense – related parties                                 |   |                    | (765       | ) |   |   | (1,332 | ) |   |   | (724 | ) |
|        Income from continuing operations          |   |                    | 34,449     |   |   |   | 50,340 |   |   |   | 89,228 |   |
|                                                                                 |   |                    |       |   |   |   |   |   |   |   |   |   |
| Discontinued operations:                                                             |   |                    |       |   |   |   |   |   |   |   |   |   |
|   Net gain on disposal of properties classified as discontinued operations |   |                    | -          |   |   |   | - |   |   |   | 6,529 |   |
|   Net income attributable to discontinued operations                       |   |                    | -          |   |   |   | - |   |   |   | 91 |   |
|        Income from discontinued operations             |   |                    | -          |   |   |   | - |   |   |   | 6,620 |   |
|                                                                                 |   |                    |       |   |   |   |   |   |   |   |   |   |
| Net income                                                                           |   |                    | 34,449     |   |   |   | 50,340 |   |   |   | 95,848 |   |
| Net income attributable to noncontrolling interests                                  |   |                    | (26,058    | ) |   |   | (40,206 | ) |   |   | (76,960 | ) |
| Net income available to common stockholders                                          |   | $                       | 8,391      |   |   | $ | 10,134 |   |   | $ | 18,888 |   |
|                                                                                 |   |                    |       |   |   |   |   |   |   |   |   |   |
| Net income per share from continuing operations:                                     |   |                    |       |   |   |   |   |   |   |   |   |   |
|   Basic                                                                    |   | $                       | 0.39       |   |   | $ | 0.51 |   |   | $ | 0.90 |   |
|   Diluted                                                                  |   | $                       | 0.38       |   |   | $ | 0.51 |   |   | $ | 0.89 |   |
| Net income per share from discontinued operations:                                   |   |                    |       |   |   |   |   |   |   |   |   |   |
|   Basic                                                                    |   |                    | -          |   |   |   | - |   |   | $ | 0.06 |   |
|   Diluted                                                                  |   |                    | -          |   |   |   | - |   |   | $ | 0.06 |   |
| Net income per share to common stockholders:                                         |   |                    |       |   |   |   |   |   |   |   |   |   |
|   Basic                                                                    |   | $                       | 0.39       |   |   | $ | 0.51 |   |   | $ | 0.96 |   |
|   Diluted                                                                  |   | $                       | 0.38       |   |   | $ | 0.51 |   |   | $ | 0.95 |   |
| Weighted average shares of common stock (basic)                                      |   |                    | 21,736,699 |   |   |   | 19,714,414 |   |   |   | 19,627,234 |   |
| Weighted average shares of common stock (diluted)                                    |   |                    | 21,923,104 |   |   |   | 19,996,349 |   |   |   | 19,854,411 |   |
| Weighted average O.P. units                                                          |   |                    | 83,538,477 |   |   |   | 85,528,329 |   |   |   | 85,162,240 |   |
| Outstanding common stock                                                             |   |                    | 21,870,211 |   |   |   | 19,748,211 |   |   |   | 19,664,087 |   |
| Outstanding O.P. units                                                               |   |                    | 83,404,965 |   |   |   | 85,526,965 |   |   |   | 85,533,935 |   |

----

|                                                                                                                                 |   |                                          |       |   |                                       |   |   |                                               |   |   |                                                              |   |   |                                                                          |    |   |                                                                 |   |    |                                             |   |
|--------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------|------------|--------|--------------------------------------------|--------|--------|----------------------------------------------------|--------|--------|-------------------------------------------------------------------|--------|--------|-------------------------------------------------------------------------------|---------|--------|----------------------------------------------------------------------|--------|---------|--------------------------------------------------|--------|
|                                                                                                                                 |   |                                          |       |   |                                       |   |   |                                               |   |   |                                                              |   |   |                                                                          |    |   |                                                                 |   |    |                                             |   |
|                                                                                                                                 |   | Common Stock                                  |       |   |                                       |   |   |                                               |   |   |                                                              |   |
|                                                                                                                                 |   |      Numberof Shares |       |   |      Common Stock |   |   |     Additional Paid-in Capital |   |   |    Distributions in Excess of Accumulated Earnings |   |   | Total Stockholders’ Equity Attributable toMission West Properties, Inc. |    |   |    Noncontrolling Interests in Operating Partnerships |   |    |       Total Equity |   |
|                                                                                                                                 |   |                                          |       |   |                                       |   |   |                                               |   |   |                                                              |   |   |                                                                          |    |   |                                                                 |   |    |                                             |   |
| Balance, December 31, 2006                                                                                                           |   |                                          | 19,443,587 |   |                                       | $      | 19     |                                               |   | $      | 149,541                                                           |   |   | $                                                                             | (20,682 | )      |                                                                 | $      | 128,878 |                                             |   | $ | 501,282 |   |   | $ | 630,160 |   |
|                                                                                                                                 |   |                                          |       |   |                                       |   |   |                                               |   |   |                                                              |   |   |                                                                          |    |   |                                                                 |   |    |                                             |   |   |   |   |   |   |   |   |
|    Net income                                                                                                         |   |                                          | -          |   |                                       |   | -      |                                               |   |   | -                                                                 |   |   |                                                                          | 18,888  |   |                                                                 |   | 18,888  |                                             |   |   | 76,960 |   |   |   | 95,848 |   |
|    Dividends declared per common share       and O.P. Unit at $0.64 per share/unit |   |                                          | -          |   |                                       |   | -      |                                               |   |   | -                                                                 |   |   |                                                                          | (12,572 | )      |                                                                 |   | (12,572 | )                                                |   |   | (54,580 | ) |   |   | (67,152 | ) |
|    Joint ventures distributions                                                                                       |   |                                          | -          |   |                                       |   | -      |                                               |   |   | -                                                                 |   |   |                                                                          | -       |   |                                                                 |   | -       |                                             |   |   | (785 | ) |   |   | (785 | ) |
|    Issuance of common stock       upon O.P. Unit conversion                        |   |                                          | 220,500    |   |                                       |   | 1      |                                               |   |   | 2,854                                                             |   |   |                                                                          | -       |   |                                                                 |   | 2,855   |                                             |   |   | (2,855 | ) |   |   | - |   |
|    Issuance of O.P. Units – property acquisition                                                                |   |                                          | -          |   |                                       |   | -      |                                               |   |   | -                                                                 |   |   |                                                                          | -       |   |                                                                 |   | -       |                                             |   |   | 6,604 |   |   |   | 6,604 |   |
|    Amortization of stock-based compensation                                                                           |   |                                          | -          |   |                                       |   | -      |                                               |   |   | 629                                                               |   |   |                                                                          | -       |   |                                                                 |   | 629     |                                             |   |   | - |   |   |   | 629 |   |
| Balance, December 31, 2007                                                                                                           |   |                                          | 19,664,087 |   |                                       |   | 20     |                                               |   |   | 153,024                                                           |   |   |                                                                          | (14,366 | )      |                                                                 |   | 138,678 |                                             |   |   | 526,626 |   |   |   | 665,304 |   |
|                                                                                                                                 |   |                                          |       |   |                                       |   |   |                                               |   |   |                                                              |   |   |                                                                          |    |   |                                                                 |   |    |                                             |   |   |   |   |   |   |   |   |
|    Net income                                                                                                         |   |                                          | -          |   |                                       |   | -      |                                               |   |   | -                                                                 |   |   |                                                                          | 10,134  |   |                                                                 |   | 10,134  |                                             |   |   | 40,206 |   |   |   | 50,340 |   |
|    Dividends declared per common share       and O.P. Unit at $0.80 per share/unit |   |                                          | -          |   |                                       |   | -      |                                               |   |   | -                                                                 |   |   |                                                                          | (15,782 | )      |                                                                 |   | (15,782 | )                                                |   |   | (68,423 | ) |   |   | (84,205 | ) |
|    Joint ventures distributions                                                                                       |   |                                          | -          |   |                                       |   | -      |                                               |   |   | -                                                                 |   |   |                                                                          | -       |   |                                                                 |   | -       |                                             |   |   | (858 | ) |   |   | (858 | ) |
|    Issuance of common stock       upon O.P. Unit conversion                        |   |                                          | 6,970      |   |                                       |   | -      |                                               |   |   | 66                                                                |   |   |                                                                          | -       |   |                                                                 |   | 66      |                                             |   |   | (66 | ) |   |   | - |   |
|    Issuance of common stock upon option exercise                                                                      |   |                                          | 77,154     |   |                                       |   | -      |                                               |   |   | 769                                                               |   |   |                                                                          | -       |   |                                                                 |   | 769     |                                             |   |   | - |   |   |   | 769 |   |
|    Amortization of stock-based compensation                                                                           |   |                                          | -          |   |                                       |   | -      |                                               |   |   | 553                                                               |   |   |                                                                          | -       |   |                                                                 |   | 553     |                                             |   |   | - |   |   |   | 553 |   |
| Balance, December 31, 2008                                                                                                           |   |                                          | 19,748,211 |   |                                       |   | 20     |                                               |   |   | 154,412                                                           |   |   |                                                                          | (20,014 | )      |                                                                 |   | 134,418 |                                             |   |   | 497,485 |   |   |   | 631,903 |   |
|                                                                                                                                 |   |                                          |       |   |                                       |   |   |                                               |   |   |                                                              |   |   |                                                                          |    |   |                                                                 |   |    |                                             |   |   |   |   |   |   |   |   |
|    Net income                                                                                                         |   |                                          | -          |   |                                       |   | -      |                                               |   |   | -                                                                 |   |   |                                                                          | 8,391   |   |                                                                 |   | 8,391   |                                             |   |   | 26,058 |   |   |   | 34,449 |   |
|    Dividends declared per common share       and O.P. Unit at $0.65 per share/unit |   |                                          | -          |   |                                       |   | -      |                                               |   |   | -                                                                 |   |   |                                                                          | (14,161 | )      |                                                                 |   | (14,161 | )                                                |   |   | (54,268 | ) |   |   | (68,429 | ) |
|    Joint ventures distributions                                                                                       |   |                                          | -          |   |                                       |   | -      |                                               |   |   | -                                                                 |   |   |                                                                          | -       |   |                                                                 |   | -       |                                             |   |   | (1,146 | ) |   |   | (1,146 | ) |
|    Issuance of common stock       upon O.P. Unit conversion                        |   |                                          | 2,122,000  |   |                                       |   | 2      |                                               |   |   | 15,842                                                            |   |   |                                                                          | -       |   |                                                                 |   | 15,844  |                                             |   |   | (15,844 | ) |   |   | - |   |
|    Amortization of stock-based compensation                                                                           |   |                                          | -          |   |                                       |   | -      |                                               |   |   | 352                                                               |   |   |                                                                          | -       |   |                                                                 |   | 352     |                                             |   |   | - |   |   |   | 352 |   |
| Balance, December 31, 2009                                                                                                           |   |                                          | 21,870,211 |   |                                       | $      | 22     |                                               |   | $      | 170,606                                                           |   |   | $                                                                             | (25,784 | )      |                                                                 | $      | 144,844 |                                             |   | $ | 452,285 |   |   | $ | 597,129 |   |

----

|                                                                                                 |   |                    |    |   |   |   |     |   |   |
|------------------------------------------------------------------------------------------------------|--------|-------------------------|---------|--------|--------|--------|----------|--------|--------|
|                                                                                                 |   | Year Ended December 31, |    |
|                                                                                                 |   | 2009                    |    |   | 2008   |   |     | 2007   |   |
| Cash flows from operating activities:                                                                |   |                    |    |   |   |   |     |   |   |
| Net income                                                                                           |   | $                       | 34,449  |   |   | $      | 50,340   |   |   | $ | 95,848 |   |
| Adjustments to reconcile net income to net cash provided by operating   activities:   |   |                    |    |   |   |   |     |   |   |   |   |   |
|      Depreciation and amortization                                          |   |                    | 24,110  |   |   |   | 23,224   |   |   |   | 22,735 |   |
|      Amortization of above market lease                                     |   |                    | -       |   |   |   | -        |   |   |   | 4,091 |   |
|      Gain from disposal of properties classified as discontinued operations |   |                    | -       |   |   |   | -        |   |   |   | (6,529 | ) |
|      Unrealized (gain) from restricted investment in marketable securities  |   |                    | (5,011  | )      |   |   | 278      |   |   |   | - |   |
|      Dividend income from restricted investment in marketable securities    |   |                    | (726    | )      |   |   | -        |   |   |   | - |   |
|      Equity in earnings of unconsolidated joint venture                     |   |                    | (309    | )      |   |   | (19,617  | )      |   |   | (1,408 | ) |
|      Distributions from unconsolidated joint venture                        |   |                    | 250     |   |   |   | 18,584   |   |   |   | 2,141 |   |
|      Interest earned on restricted cash                                     |   |                    | (94     | )      |   |   | (977     | )      |   |   | (1,631 | ) |
|      Lease termination fee income related to restricted cash                |   |                    | 10,864  |   |   |   | 9,741    |   |   |   | (35,636 | ) |
|      Stock-based compensation expense                                       |   |                    | 352     |   |   |   | 553      |   |   |   | 629 |   |
|      Other                                                                  |   |                    | -       |   |   |   | 123      |   |   |   | 147 |   |
| Change in operating assets and liabilities, net of liabilities assumed:                              |   |                    |    |   |   |   |     |   |   |   |   |   |
|      Proceeds from (purchase of) investment in marketable securities        |   |                    | 3,646   |   |   |   | (3,368   | )      |   |   | - |   |
|      Deferred rent receivables                                              |   |                    | (870    | )      |   |   | (3,008   | )      |   |   | 3,656 |   |
|      Other assets                                                           |   |                    | (4,700  | )      |   |   | (2,575   | )      |   |   | (389 | ) |
|      Interest payable                                                       |   |                    | 68      |   |   |   | 265      |   |   |   | (44 | ) |
|      Security deposits                                                      |   |                    | (423    | )      |   |   | 518      |   |   |   | (2,230 | ) |
|      Deferred rental income                                                 |   |                    | 2,575   |   |   |   | 662      |   |   |   | (3,572 | ) |
|      Accounts payable and accrued expenses                                  |   |                    | (8,109  | )      |   |   | 2,129    |   |   |   | 1,006 |   |
|         Net cash provided by operating activities            |   |                    | 56,072  |   |   |   | 76,872   |   |   |   | 78,814 |   |
|                                                                                                 |   |                    |    |   |   |   |     |   |   |   |   |   |
| Cash flows from investing activities:                                                                |   |                    |    |   |   |   |     |   |   |   |   |   |
| Improvements to investments in real estate                                                           |   |                    | (178    | )      |   |   | (6,468   | )      |   |   | (4,878 | ) |
| Net proceeds from sale of properties                                                                 |   |                    | -       |   |   |   | -        |   |   |   | 15,431 |   |
| Acquisition of properties                                                                            |   |                    | -       |   |   |   | (35,764  | )      |   |   | (47,491 | ) |
| Restricted cash held in escrow                                                                       |   |                    | (100    | )      |   |   | -        |   |   |   | (15,431 | ) |
| Restricted cash released for purchase of properties                                                  |   |                    | -       |   |   |   | 8,082    |   |   |   | 43,191 |   |
| Proceeds from release of restricted cash                                                             |   |                    | -       |   |   |   | 7,654    |   |   |   | 630 |   |
|         Net cash provided by (used in) investing activities  |   |                    | (278    | )      |   |   | (26,496  | )      |   |   | (8,548 | ) |
|                                                                                                 |   |                    |    |   |   |   |     |   |   |   |   |   |
| Cash flows from financing activities:                                                                |   |                    |    |   |   |   |     |   |   |   |   |   |
| Proceeds from mortgage loan payable                                                                  |   |                    | -       |   |   |   | 115,000  |   |   |   | - |   |
| Principal payments on mortgage notes payable                                                         |   |                    | (12,090 | )      |   |   | (121,612 | )      |   |   | (10,581 | ) |
| Principal payments on mortgage notes payable (related parties)                                       |   |                    | (500    | )      |   |   | (463     | )      |   |   | (430 | ) |
| Real estate purchase financing (related parties)                                                     |   |                    | -       |   |   |   | 19,429   |   |   |   | - |   |
| Payment on real estate purchase financing (related parties)                                          |   |                    | -       |   |   |   | (19,429  | )      |   |   | - |   |
| Proceeds from note payable (related parties)                                                         |   |                    | 39,420  |   |   |   | 3,000    |   |   |   | - |   |
| Payment on note payable (related parties)                                                            |   |                    | (39,420 | )      |   |   | (3,000   | )      |   |   | - |   |
| Proceeds from note payable                                                                           |   |                    | 22,000  |   |   |   | -        |   |   |   | - |   |
| Net borrowings on revolving line of credit                                                           |   |                    | 1,387   |   |   |   | 13,079   |   |   |   | - |   |
| Debt issuance costs                                                                                  |   |                    | -       |   |   |   | (1,231   | )      |   |   | - |   |
| Loan escrow refund (deposit)                                                                         |   |                    | -       |   |   |   | 1,500    |   |   |   | (1,500 | ) |
| Net proceeds from exercise of stock options                                                          |   |                    | -       |   |   |   | 768      |   |   |   | - |   |
| Distributions paid to noncontrolling interests                                                       |   |                    | (50,775 | )      |   |   | (66,129  | )      |   |   | (55,313 | ) |
| Dividends paid to common stockholders                                                                |   |                    | (14,830 | )      |   |   | (14,979  | )      |   |   | (12,536 | ) |
|         Net cash used in financing activities                |   |                    | (54,808 | )      |   |   | (74,067  | )      |   |   | (80,360 | ) |
|                                                                                                 |   |                    |    |   |   |   |     |   |   |   |   |   |
|         Net increase (decrease) in cash and cash equivalents |   |                    | 986     |   |   |   | (23,691  | )      |   |   | (10,094 | ) |
| Cash and cash equivalents, beginning of year                                                         |   |                    | -       |   |   |   | 23,691   |   |   |   | 33,785 |   |
|                                                                                                 |   |                    |    |   |   |   |     |   |   |   |   |   |
| Cash and cash equivalents, end of year                                                               |   | $                       | 986     |   |   | $      | -        |   |   | $ | 23,691 |   |

----

| 1.   | ORGANIZATIONS AND FORMATION OF THE COMPANY |
|----------------|--------------------------------------------|

| 2.   | BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
|----------------|----------------------------------------------------------------------|

----

| Building shell and base building improvements of newly acquired properties | - | Weighted average composite life of 40 years                     |
|----------------------------------------------------------------------------|---|-----------------------------------------------------------------|
| Base building improvements made subsequent to initial property acquisition | - | 25 years                                                        |
| Tenant improvements and furniture and fixtures                             | - | Lesser of life of asset, generally 5-10 years, or term of lease |
| Above-market and in-place lease value                                      | - | Term of lease                                                   |

----

----

| ·   | the agreement has been fully executed and delivered; |
|--------------------|------------------------------------------------------|

| ·   | services have been rendered; |
|--------------------|------------------------------|

| ·   | the amount is fixed and determinable; and |
|--------------------|-------------------------------------------|

| ·   | the collectability is reasonably assured. |
|--------------------|-------------------------------------------|

----

----

| ·   | The three non-employee outside directors each received 45,000 DERs, which will remain in effect as long as the individual continues to serve on the Board of Directors; and |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Key employees of the Company received a total of 155,000 DERs, which will remain in effect for each key employee as long as they continue to be employed by the Company. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| 3.   | DEFERRED RENT RECEIVABLE, NET |
|----------------|-------------------------------|

|                         |   | Beginning Balance      |   |   | Provision Against Revenue |   |   | Charge-off |   |   | Ending Balance |   |
|------------------------------|--------|------------------------|--------|--------|---------------------------|--------|--------|------------|--------|--------|----------------|--------|
|                         |   | (dollars in thousands) |   |
| Year ended December 31, 2007 |   | $                      | 2,000  |   |                      | $      | 4,457  |       |   | $      | 2,707          |   |   | $ | 250 |   |
| Year ended December 31, 2008 |   | $                      | 250    |   |                      | $      | 259    |       |   | $      | 259            |   |   | $ | 250 |   |
| Year ended December 31, 2009 |   | $                      | 250    |   |                      | $      | 312    |       |   | $      | 312            |   |   | $ | 250 |   |

| 4.   | STOCK TRANSACTIONS |
|----------------|--------------------|

----

| 5.   | NONCONTROLLING INTERESTS IN OPERATING PARTNERSHIPS |
|----------------|----------------------------------------------------|

| 6.   | REAL ESTATE |
|----------------|-------------|

----

| ·   | The fair value of the tangible assets of an acquired property, which includes land, building and tenant improvements, is determined by valuing the property as if it were vacant, and the “as-if-vacant” value is then allocated to land, building and tenant improvements based on management’s determination of the relative fair values of these assets. Factors considered by management in performing these analyses include certain costs during the lease-up periods considering current market conditions and costs to execute similar leases. These costs include estimates of lost rental income, leasing commissions and tenant improvements. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The capitalized value of above-market and below-market leases and acquired in-place lease values, included in real estate related intangible assets in the accompanying consolidated balance sheets, is amortized to expense as amortization of real estate over the remaining non-cancelable lease term. If a lease were to be terminated prior to its stated expiration, all unamortized amounts relating to that lease would be written off in the period that the lease is terminated. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 7.   | VARIABLE INTEREST ENTITY |
|----------------|--------------------------|

| 1.   | The equity investment at risk is not sufficient to permit the entity to finance its activities without additional subordinated financial support by any parties, including the equity holders. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.   | The equity investors lack one or more of the following essential characteristics of a controlling financial interest: |
|----------------|-----------------------------------------------------------------------------------------------------------------------|

| a.   | the direct or indirect ability to make decisions about the entity’s activities through voting or similar rights; |
|----------------|------------------------------------------------------------------------------------------------------------------------|

| b.   | the obligation to absorb the expected loss of the entity; |
|----------------|-----------------------------------------------------------|

| c.   | the right to receive the expected residual returns of the entity; or |
|----------------|----------------------------------------------------------------------|

| 3.   | The equity investors have voting rights that are not proportionate to their economic interests, and the activities of the entity involve or are conducted on behalf of an investor with a disproportionately small voting interest. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | No equity was contributed by the partners in the formation of M&M. |
|--------------------|------------------------------------------------------------------------|

| ·   | At present, the assigned leases are the only properties under management by M&M. |
|--------------------|--------------------------------------------------------------------------------------|

| ·   | Because M&M does not have an operating history that demonstrates its ability to finance its activities without additional subordinated financial support. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | All revenues, other than interest income, are generated by M&M from the Company in the form of fees or commissions. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------|

----

| 8.   | DEBT |
|----------------|------|

|                                                                                                                                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | Balance atDecember 31, |          |     |          |           |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------|---------------|----------|---------------|----------------|
| Debt Description                                                                                                                                                                  |   | Collateral Properties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                   | Maturity Date |     | Interest Rate |
|                                                                                                                                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | 2009                   |          | 2008     |          |           |   |   |
|                                                                                                                                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | (dollars in thousands) |          |     |          |           |
| Line of Credit:                                                                                                                                                                   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                   |          |     |          |           |   |   |
| Heritage Bank of Commerce (1)                                                                                                                                                     |   | 1600 Memorex Drive, Santa Clara, CA1688 Richard Avenue, Santa Clara, CA1700 Richard Avenue, Santa Clara, CA                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | $14,466                |          | $13,079  |          | September 2011 |   | (1) |
|                                                                                                                                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                   |          |     |          |           |   |   |
| Mortgage Notes Payable (related parties) (2) :                                                                                                                                    |   | 5300-5350 Hellyer Avenue, San Jose, CA                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | 8,261                  |          | 8,761    |          | June 2013      |   | 7.650% |
|                                                                                                                                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                   |          |     |          |           |   |   |
| Note Payable (related parties):                                                                                                                                                   |   | Not Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | 9,325                  |          | -        |          | June 2010      |   | (6) |
|                                                                                                                                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                   |          |     |          |           |   |   |
| Mortgage Notes Payable (2) :                                                                                                                                                      |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                   |          |     |          |           |   |   |
| Hartford Life Insurance Company (3)Hartford Life and Accident Insurance CompanyHartford Life and Annuity Insurance Company(collectively known as the “Hartford Loan”) |   | 5981 Optical Court, San Jose, CA5500 Hellyer Avenue, San Jose, CA5550 Hellyer Avenue, San Jose, CA4050 Starboard Drive, Fremont, CA45738 Northport Loop, Fremont, CA233 South Hillview Drive, Milpitas, CA10300 Bubb Road, Cupertino, CA1230 E. Arques, Sunnyvale, CA1250-1280 E. Arques, Sunnyvale, CA1212 Bordeaux Lane, Sunnyvale, CA2904 Orchard Parkway, San Jose, CA3236 Scott Blvd, Santa Clara, CA6311 San Ignacio Avenue, San Jose, CA6321-6325 San Ignacio Avenue, San Jose, CA6331 San Ignacio Avenue, San Jose, CA6341-6351 San Ignacio Avenue, San Jose, CA3540-3580 Bassett Street, Santa Clara, CA |   | 111,485                |          | 114,513  |          | October 2018   |   | 6.210% |
|                                                                                                                                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                   |          |     |          |           |   |   |
| Northwestern Mutual Life Insurance Co. (4)                                                                                                                                        |   | 1750 Automation Parkway, San Jose, CA1756 Automation Parkway, San Jose, CA1762 Automation Parkway, San Jose, CA6320 San Ignacio Avenue, San Jose, CA6540-6541 Via Del Oro, San Jose, CA6385-6387 San Ignacio Avenue, San Jose, CA20605-20705 Valley Green Drive, Cupertino, CA2001 Walsh Avenue, Santa Clara, CA2220 Central Expressway, Santa Clara, CA2300 Central Expressway, Santa Clara, CA2330 Central Expressway, Santa Clara, CA                                                                                                                                                                          |   | 77,444                 |          | 81,308   |          | January 2013   |   | 5.640% |
|                                                                                                                                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                   |          |     |          |           |   |   |
| Allianz Life Insurance Company (I) (5)                                                                                                                                            |   | 5900 Optical Court, San Jose, CA                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   | 22,146                 |          | 23,009   |          | August 2025    |   | 5.560% |
|                                                                                                                                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                   |          |     |          |           |   |   |
| Allianz Life Insurance Company (II) (5)                                                                                                                                           |   | 5325-5345 Hellyer Avenue, San Jose, CA1768 Automation Parkway, San Jose, CA2880 Scott Boulevard, Santa Clara, CA2890 Scott Boulevard, Santa Clara, CA2800 Scott Boulevard, Santa Clara, CA10450-10460 Bubb Road, Cupertino, CA6800-6810 Santa Teresa Blvd., San Jose, CA6850 Santa Teresa Blvd., San Jose, CA4750 Patrick Henry Drive, Santa Clara, CA                                                                                                                                                                                                                                                            |   | 107,743                |          | 112,078  |          | August 2025    |   | 5.220% |
|                                                                                                                                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                   |          |     |          |           |   |   |
|                                                                                                                                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | 318,818                |          | 330,908  |          |           |   |   |
|                                                                                                                                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                   |          |     |          |           |   |   |
| Total                                                                                                                                                                             |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | $350,870               |          | $352,748 |          |           |   |   |

| (1)   | The Heritage Bank of Commerce (“HBC”) line of credit was obtained in March 2008. In April 2008, the Company entered into a change in terms agreement with HBC that increased the facility from $10 million to $17.5 million. In October 2009, the Company entered into a change in terms agreement with HBC to amend the maturity date to September 15, 2011. The interest rate on the revolving line of credit is the greater of LIBOR plus 1.75% or 4.00% per annum. The interest rate for the HBC line of credit at December 31, 2009 and 2008 was 4.00% and 3.17%, respectively. The Company paid in aggregate approximately $49 in loan and legal fees. The HBC line of credit contains certain financial loan and reporting covenants as defined in the loan agreement. As of December 31, 2009, the Company was in compliance with these loan covenants. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2)   | Mortgage notes payable and mortgage note payable (related parties) generally require monthly installments of interest and principal ranging from approximately $96 to $840 over various terms extending through the year 2025. The weighted average interest rate for the mortgage notes payable was 5.74% and 5.86% at December 31, 2009 and 2008, respectively. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3)   | The Hartford loan is payable in monthly installments of approximately $838, which includes principal (based upon a 20-year amortization) and interest.  Costs and fees incurred with obtaining this loan aggregated approximately $1,058, which were deferred and amortized over the loan period. The Hartford loan contains certain customary covenants as defined in the loan agreement. As of December 31, 2009, the Company was in compliance with these loan covenants. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (4)   | The Northwestern loan is payable in monthly installments of approximately $696, which includes principal (based upon a 20-year amortization) and interest. Costs and fees incurred with obtaining this loan aggregated approximately $664, which were deferred and amortized over the loan period. The Northwestern loan contains certain customary covenants as defined in the loan agreement. As of December 31, 2009, the Company was in compliance with these loan covenants. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (5)   | The Allianz loans are payable in monthly installments of approximately $1,017, which includes principal (based upon a 20-year amortization) and interest. Costs and fees incurred with obtaining these loans aggregated approximately $1,125, which were deferred and amortized over the loan periods. The Allianz loans contain certain customary covenants as defined in the loan agreements. As of December 31, 2009, the Company was in compliance with these loan covenants. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (6)   | The Company issued a short-term note to the Berg Group in connection with the quarterly dividend distributions. The interest rate of the note payable is LIBOR plus 1.75%. The interest rate for the note payable was 1.98% at December 31, 2009. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                |   | Total Debt(Including Related Parties) |    |
|-------------------------------------|--------|---------------------------------------|---------|
| December 31, 2010                   |   | $                                     | 22,653  |   |
| December 31, 2011                   |   |                                  | 28,575  |   |
| December 31, 2012                   |   |                                  | 14,935  |   |
| December 31, 2013                   |   |                                  | 81,269  |   |
| December 31, 2014                   |   |                                  | 10,891  |   |
| Thereafter                          |   |                                  | 192,547 |   |
|      Total |   | $                                     | 350,870 |   |

----

| 9.   | OPERATING PARTNERSHIP AND STOCKHOLDER DISTRIBUTIONS |
|----------------|-----------------------------------------------------|

| 10.   | EQUITY-BASED COMPENSATION AND RETIREMENT INVESTMENT PLANS |
|-----------------|-----------------------------------------------------------|

| ·   | transferred up to 3,991,089 remaining shares available for issuance under the Company’s 1997 Plan and terminated the 1997 Plan for any new grants; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | transferred up to an additional 767,000 shares subject to outstanding options under the 1997 Plan if they expire without being exercised, of which 272,000 shares had been transferred as of December 31, 2008; and |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | includes the ability to grant restricted stock, restricted stock units, performance units, dividend equivalent rights, and other stock-based compensation, including O.P. Units of the Operating Partnerships, as well as incentive and non-statutory stock options. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                     |   | Options     |      |   | Weighted AverageExercise Price |   |
|------------------------------------------|--------|-------------|-----------|--------|--------------------------------|--------|
|                                     |   | Outstanding |      |   | Per Share                      |   |
| Balance, December 31, 2006               |   |        | 1,037,000 |   |                           | $      | 10.48 |   |
| Options granted                          |   |        | 710,000   |   |                           | $      | 12.09 |   |
| Balance, December 31, 2007               |   |        | 1,747,100 |   |                           | $      | 11.13 |   |
| Options granted                          |   |        | 1,782,500 |   |                           | $      | 8.23 |   |
| Options exercised                        |   |        | (77,154   | )      |                           | $      | 9.96 |   |
| Options forfeited                        |   |        | (119,946  | )      |                           | $      | 10.81 |   |
| Balance, December 31, 2008               |   |        | 3,332,500 |   |                           | $      | 9.62 |   |
| Options granted                          |   |        | 500,000   |   |                           | $      | 5.99 |   |
| Options forfeited                        |   |        | (575,000  | )      |                           | $      | 10.70 |   |
| Balance, December 31, 2009               |   |        | 3,257,500 |   |                           | $      | 8.87 |   |
| Available for grant at December 31, 2009 |   |        | 1,255,535 |   |                           |   |   |   |
| Available for grant at December 31, 2008 |   |        | 1,180,535 |   |                           |   |   |   |

|                                             | Options Outstanding             | Options Exercisable                                             | Options Not Exercisable                         |
|--------------------------------------------------|---------------------------------|-----------------------------------------------------------------|-------------------------------------------------|
|     Range of Exercise Prices |     Options |  Weighted AverageRemaining  Contractual Life in Years |  Weighted Average ExercisePrice  |     Options |  Weighted Average ExercisePrice  |     Options |  Weighted Average ExercisePrice  |
| $5.99                                            | 500,000                         | 5.17                                                            | $5.99                                           | 331,250 | $5.99 | 168,750 | $5.99 |
| $6.14                                            | 705,000                         | 4.92                                                            | $6.14                                           | 324,688 | $6.14 | 380,312 | $6.14 |
| $9.51                                            | 760,000                         | 4.00                                                            | $9.51                                           | 364,167 | $9.51 | 395,833 | $9.51 |
| $10.00                                           | 590,000                         | 1.33                                                            | $10.00                                          | 590,000 | $10.00 | - | - |
| $11.36                                           | 52,500                          | 4.58                                                            | $11.36                                          | 18,594 | $11.36 | 33,906 | $11.36 |
| $12.09                                           | 650,000                         | 3.00                                                            | $12.09                                          | 473,958 | $12.09 | 176,042 | $12.09 |
|                                             |                            |                                                            |                                            |   |   |   |   |
| $5.99 to $12.09                                  | 3,257,500                       | 3.70                                                            | $8.87                                           | 2,102,657 | $9.17 | 1,154,843 | $8.33 |

----

| 11.   | NET INCOME PER SHARE |
|-----------------|----------------------|

----

|                                                                                                                                                      |   | Year Ended December 31, 2009                  |       |   | Year Ended December 31, 2008 |   |       | Year Ended December 31, 2007 |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------|------------|--------|------------------------------|--------|------------|------------------------------|--------|
|                                                                                                                                                      |   | (dollars in thousands, except per share data) |       |
| Numerator:                                                                                                                                                |   |                                          |       |   |                         |   |       |                         |   |
|    Income from continuing operations                                                                                                       |   | $                                             | 8,391      |   |                         | $      | 10,134     |                         |   | $ | 17,757 |   |
|    Income from discontinued operations                                                                                                     |   |                                          | -          |   |                         |   | -          |                         |   |   | 1,131 |   |
|       Net income available to common stockholders                                                                           |   | $                                             | 8,391      |   |                         | $      | 10,134     |                         |   | $ | 18,888 |   |
|                                                                                                                                                      |   |                                          |       |   |                         |   |       |                         |   |   |   |   |
| Denominator:                                                                                                                                              |   |                                          |       |   |                         |   |       |                         |   |   |   |   |
|    Weighted average shares of common stock (basic)                                                                                         |   |                                          | 21,736,699 |   |                         |   | 19,714,414 |                         |   |   | 19,627,234 |   |
|    Effect of dilutive securities:                                                                                                          |   |                                          |       |   |                         |   |       |                         |   |   |   |   |
|       Incremental shares from assumed stock options exercise                                                                |   |                                          | 186,405    |   |                         |   | 281,935    |                         |   |   | 227,177 |   |
|          Weighted average shares of common stock (diluted)                                                   |   |                                          | 21,923,104 |   |                         |   | 19,996,349 |                         |   |   | 19,854,411 |   |
|                                                                                                                                                      |   |                                          |       |   |                         |   |       |                         |   |   |   |   |
| Per share data:                                                                                                                                           |   |                                          |       |   |                         |   |       |                         |   |   |   |   |
|    Basic net income per share:                                                                                                             |   |                                          |       |   |                         |   |       |                         |   |   |   |   |
|       Net income to common stockholders before discontinued         operations |   | $                                             | 0.39       |   |                         | $      | 0.51       |                         |   | $ | 0.90 |   |
|       Discontinued operations                                                                                               |   |                                          | -          |   |                         |   | -          |                         |   |   | 0.06 |   |
|             Net income available to common stockholders                                       |   | $                                             | 0.39       |   |                         | $      | 0.51       |                         |   | $ | 0.96 |   |
|    Diluted net income per share:                                                                                                           |   |                                          |       |   |                         |   |       |                         |   |   |   |   |
|       Net income to common stockholders before discontinued         operations |   | $                                             | 0.38       |   |                         | $      | 0.51       |                         |   | $ | 0.89 |   |
|       Discontinued operations                                                                                               |   |                                          | -          |   |                         |   | -          |                         |   |   | 0.06 |   |
|             Net income available to common stockholders                                       |   | $                                             | 0.38       |   |                         | $      | 0.51       |                         |   | $ | 0.95 |   |

| 12.   | OTHER INCOME |
|-----------------|--------------|

| 13.   | RELATED PARTY TRANSACTIONS |
|-----------------|----------------------------|

----

----

----

| 14.   | FUTURE MINIMUM RENTS |
|-----------------|----------------------|

| Year                                |   | Minimum Rent           |    |
|-------------------------------------|--------|------------------------|---------|
|                                |   | (dollars in thousands) |    |
| 2010                                |   | $                      | 83,513  |   |
| 2011                                |   |                   | 78,103  |   |
| 2012                                |   |                   | 62,033  |   |
| 2013                                |   |                   | 52,037  |   |
| 2014                                |   |                   | 40,987  |   |
| Thereafter                          |   |                   | 45,349  |   |
|      Total |   | $                      | 362,022 |   |

| 15.   | SUPPLEMENTAL CASH FLOW INFORMATION |
|-----------------|------------------------------------|

----

| 16.   | COMMITMENTS AND CONTINGENCIES |
|-----------------|-------------------------------|

----

| 17.   | REAL ESTATE ASSET HELD FOR SALE AND DISCONTINUED OPERATIONS |
|-----------------|-------------------------------------------------------------|

----

|                                                                    |   | Year Ended             |   |
|-------------------------------------------------------------------------|--------|------------------------|--------|
|                                                                    |   | December 31, 2007      |   |
|                                                                    |   | (dollars in thousands) |   |
| Revenues:                                                               |   |                   |   |
|    Rental income                                         |   | $                      | 389    |   |
|    Tenant reimbursements                                 |   |                   | 83     |   |
|    Other income                                          |   |                   | 1      |   |
|       Total operating revenues            |   |                   | 473    |   |
|                                                                    |   |                   |   |   |
| Expenses:                                                               |   |                   |   |   |
|    Property operating, maintenance and real estate taxes |   |                   | 233    |   |
|    Depreciation                                          |   |                   | 148    |   |
|      Total operating expenses                  |   |                   | 381    |   |
|                                                                    |   |                   |   |   |
|      Operating income                          |   |                   | 92     |   |
|                                                                    |   |                   |   |   |
| Other income (expenses):                                                |   |                   |   |   |
|    Interest                                              |   |                   | (1     | ) |
| Net income attributable to discontinued operations                      |   |                   | 91     |   |
| Net gain on disposal of discontinued operations                         |   |                   | 6,529  |   |
|      Income from discontinued operations       |   | $                      | 6,620  |   |

| 18.   | ACQUISITION-RELATED INTANGIBLE ASSETS |
|-----------------|---------------------------------------|

| Land                                        |   | $      | 4,704  |   |
|---------------------------------------------|--------|--------|--------|--------|
| Buildings and improvements                  |   |   | 10,871 |   |
| In-place lease                              |   |   | 1,121  |   |
|    Total cash purchase price |   | $      | 16,696 |   |

|                                       |   | December 31,           |   |
|--------------------------------------------|--------|------------------------|--------|
|                                       |   | 2009                   |   |   | 2008 |   |
|                                       |   | (dollars in thousands) |   |
| Amortizable intangible assets:             |   |                   |   |   |   |   |
|    In-place leases          |   | $                      | 3,240  |   |   | $ | 3,240 |   |
|    Accumulated amortization |   |                   | (1,978 | ) |   |   | (1,341 | ) |
| Net real estate related intangible assets  |   | $                      | 1,262  |   |   | $ | 1,899 |   |

| Year   |   | Estimated In-place LeaseAmortization (expense) |   |
|--------|--------|------------------------------------------------|--------|
|   |   | (dollars in thousands)                         |   |
| 2010   |   | $                                              | 637    |   |
| 2011   |   |                                           | 363    |   |
| 2012   |   |                                           | 224    |   |
| 2013   |   |                                           | 38     |   |
| Total  |   | $                                              | 1,262  |   |

----

| 19.   | FAIR VALUE OF RESTRICTED INVESTMENT IN MARKETABLE SECURITIES |
|-----------------|--------------------------------------------------------------|

| 20.   | SUPPLEMENTAL FINANCIAL INFORMATION  (Unaudited) |
|-----------------|-----------------------------------------------------------|

|                                              |   | For the Three Months Ended |       |
|---------------------------------------------------|--------|----------------------------|------------|
|                                              |   | March 31,                  |       |   | June 30, |   |   | September 30, |   |   | December 31, |   |
|                                              |   | (Unaudited)                |       |
| Rental income                                     |   | $                          | 20,655     |   |   | $ | 20,424 |   |   | $ | 20,442 |   |   | $ | 20,999 |   |
| Operating income                                  |   | $                          | 13,348     |   |   | $ | 10,812 |   |   | $ | 11,995 |   |   | $ | 14,547 |   |
| Net income                                        |   | $                          | 5,634      |   |   | $ | 7,189 |   |   | $ | 11,242 |   |   | $ | 10,384 |   |
| Net income available to common stockholders       |   | $                          | 1,432      |   |   | $ | 1,785 |   |   | $ | 2,766 |   |   | $ | 2,409 |   |
| Per share data:                                   |   |                       |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Basic net income per share      |   | $                          | 0.07       |   |   | $ | 0.08 |   |   | $ | 0.13 |   |   | $ | 0.11 |   |
|    Diluted net income per share    |   | $                          | 0.07       |   |   | $ | 0.08 |   |   | $ | 0.13 |   |   | $ | 0.11 |   |
| Weighted average shares of common stock (basic)   |   |                       | 21,614,878 |   |   |   | 21,766,343 |   |   |   | 21,770,211 |   |   |   | 21,793,037 |   |
| Weighted average shares of common stock (diluted) |   |                       | 21,770,489 |   |   |   | 21,899,906 |   |   |   | 21,902,387 |   |   |   | 21,979,442 |   |

|                                              |   | For the Three Months Ended |       |
|---------------------------------------------------|--------|----------------------------|------------|
|                                              |   | March 31,                  |       |   | June 30, |   |   | September 30, |   |   | December 31, |   |
|                                              |   | (Unaudited)                |       |
| Rental income                                     |   | $                          | 18,996     |   |   | $ | 19,359 |   |   | $ | 20,256 |   |   | $ | 20,464 |   |
| Operating income                                  |   | $                          | 13,545     |   |   | $ | 11,452 |   |   | $ | 12,952 |   |   | $ | 12,436 |   |
| Net income                                        |   | $                          | 9,121      |   |   | $ | 6,837 |   |   | $ | 7,939 |   |   | $ | 26,443 |   |
| Net income available to common stockholders       |   | $                          | 1,882      |   |   | $ | 1,359 |   |   | $ | 1,635 |   |   | $ | 5,257 |   |
| Per share data:                                   |   |                       |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Basic net income per share      |   | $                          | 0.10       |   |   | $ | 0.07 |   |   | $ | 0.08 |   |   | $ | 0.27 |   |
|    Diluted net income per share    |   | $                          | 0.10       |   |   | $ | 0.07 |   |   | $ | 0.08 |   |   | $ | 0.26 |   |
| Weighted average shares of common stock (basic)   |   |                       | 19,667,605 |   |   |   | 19,695,988 |   |   |   | 19,745,141 |   |   |   | 19,748,211 |   |
| Weighted average shares of common stock (diluted) |   |                       | 19,667,605 |   |   |   | 19,902,304 |   |   |   | 19,783,507 |   |   |   | 19,889,016 |   |

| (1)   | The summation of the quarterly financial data may not equal the annual number reported on the consolidated statements of operations due to rounding differences. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 21.   | SUBSEQUENT EVENTS |
|-----------------|-------------------|

----

----

----

| MISSION WEST PROPERTIES, INC.                             |
|-----------------------------------------------------------|
| Schedule III                                              |
| Real Estate and Accumulated Depreciation and Amortization |
| December 31, 2009                                         |
| (dollars in thousands)                                    |
|                                                      |   |   |   |   | Initial Cost |   |   | Total Cost |   |   |   |   |   |   |   |
|                                                      |   |   |   |   |   |   |   |   | Cost |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                      |   |   |   |   |   |   | Buildings |   | Subsequent to |   |   |   | Buildings |   |   |   | Accumulated |   |   |   |   |
|                                                      |   |   | December 31,  2009 |   |   |   | and |   | Construction/ |   |   |   | and |   |   |   | Depreciation |   | Date of |   | Depreciable |
| Property Name                                             | City |   | Encumbrances | Land |   | Improvements |   | Acquisition |   | Land |   | Improvements |   | Total |   | & Amortization |   | Acquisition |   | Life |
| 5300-5350 Hellyer Avenue                                  | San Jose | C | $8,261 |   | $5,742 |   | $11,442 |   |   |   | $5,742 |   | $11,442 |   | $17,184 |   | $2,753 |   | 5/00 |   | M |
| 10401-10411 Bubb Road                                     | Cupertino | A |   |   | 633 |   | 3,078 |   |   |   | 633 |   | 3,078 |   | 3,711 |   | 887 |   | 7/98 |   | M |
| 45365 Northport Loop                                      | Fremont |   |   |   | 2,447 |   | 5,711 |   | $11 |   | 2,447 |   | 5,722 |   | 8,169 |   | 1,332 |   | 10/00 |   | M |
| 45738 Northport Loop                                      | Fremont | F |   |   | 891 |   | 4,338 |   | 5 |   | 891 |   | 4,343 |   | 5,234 |   | 1,251 |   | 7/98 |   | M |
| 4050 Starboard Drive                                      | Fremont | F |   |   | 1,329 |   | 6,467 |   | 8 |   | 1,329 |   | 6,475 |   | 7,804 |   | 1,864 |   | 7/98 |   | M |
| 3501 W. Warren Ave/Fremont Blvd                           | Fremont |   |   |   | 1,866 |   | 9,082 |   | 1,382 |   | 1,866 |   | 10,464 |   | 12,330 |   | 3,917 |   | 7/98 |   | M |
| 48800 Milmont Blvd                                        | Fremont |   |   |   | 1,013 |   | 4,932 |   |   |   | 1,013 |   | 4,932 |   | 5,945 |   | 1,419 |   | 7/98 |   | M |
| 4750 Patrick Henry Drive                                  | Santa Clara | H |   |   | 1,604 |   | 7,805 |   | 405 |   | 1,604 |   | 8,210 |   | 9,814 |   | 2,660 |   | 7/98 |   | M |
| 3520 Bassett Street                                       | Santa Clara | D |   |   | 1,104 |   | 5,371 |   |   |   | 1,104 |   | 5,371 |   | 6,475 |   | 1,545 |   | 7/98 |   | M |
| 3530 Bassett Street                                       | Santa Clara | B,D |   |   | 849 |   | 4,133 |   |   |   | 849 |   | 4,133 |   | 4,982 |   | 1,190 |   | 7/98 |   | M |
| 5850-5870 Hellyer Avenue                                  | San Jose |   |   |   | 2,787 |   | 6,502 |   | 131 |   | 2,787 |   | 6,633 |   | 9,420 |   | 1,900 |   | 11/98 |   | M |
| 5750 Hellyer Avenue                                       | San Jose |   |   |   | 3,266 |   | 3,354 |   | 2,798 |   | 3,266 |   | 6,152 |   | 9,418 |   | 1,742 |   | 8/01 |   | M |
| 800 Embedded Way                                          | San Jose | L |   |   | 1,794 |   | - |   |   |   | 1,794 |   | - |   | 1,794 |   | - |   | 3/00 |   | - |
| 5500 Hellyer Avenue                                       | San Jose | F |   |   | 4,735 |   | 12,485 |   | 1,545 |   | 4,735 |   | 14,030 |   | 18,765 |   | 3,024 |   | 2/01 |   | M |
| 5550 Hellyer Avenue                                       | San Jose | F |   |   | 3,261 |   | 3,478 |   | 3,755 |   | 3,261 |   | 7,233 |   | 10,494 |   | 1,812 |   | 6/01 |   | M |
| 5400 Hellyer Avenue                                       | San Jose |   |   |   | 3,238 |   | 5,007 |   | 215 |   | 3,238 |   | 5,222 |   | 8,460 |   | 1,406 |   | 7/00 |   | M |
| 5325 Hellyer Avenue                                       | San Jose | H |   |   | 4,684 |   | 10,230 |   | 40 |   | 4,684 |   | 10,270 |   | 14,954 |   | 2,350 |   | 1/01 |   | M |
| 5345 Hellyer Avenue                                       | San Jose | H |   |   | 4,866 |   | 5,822 |   | 2,529 |   | 4,866 |   | 8,351 |   | 13,217 |   | 1,607 |   | 1/02 |   | M |
| 5905-5965 Silver Creek Valley Road                        | San Jose |   |   |   | 8,437 |   | 17,316 |   | 46 |   | 8,437 |   | 17,362 |   | 25,799 |   | 3,682 |   | 7/01 |   | M |
| 5905-5965 Silver Creek Valley Road                        | San Jose |   |   |   | 3,438 |   | 2,727 |   |   |   | 3,438 |   | 2,727 |   | 6,165 |   | 562 |   | 10/01 |   | M |
| 5845 Hellyer Avenue                                       | San Jose |   |   |   | 6,090 |   | 5,029 |   |   |   | 6,090 |   | 5,029 |   | 11,119 |   | 290 |   | 9/07 |   | M |
| 855 Embedded Way                                          | San Jose |   |   |   | 3,289 |   | 6,521 |   | 60 |   | 3,289 |   | 6,581 |   | 9,870 |   | 1,480 |   | 5/01 |   | M |
| 1065-1105 La Avenida Street                               | Mountain View |   |   |   | 46,832 |   | 109,275 |   | 65 |   | 46,832 |   | 109,340 |   | 156,172 |   | 29,383 |   | 4/99 |   | M |
| 1875 Charleston Road                                      | Mountain View | N |   |   | - |   | 2,615 |   |   |   | - |   | 2,615 |   | 2,615 |   | 707 |   | 4/06 |   | M |
| 1750 Automation Parkway                                   | San Jose | G |   |   | 4,789 |   | 11,174 |   | 315 |   | 4,789 |   | 11,489 |   | 16,278 |   | 3,016 |   | 7/99 |   | M |
| 1756 Automation Parkway                                   | San Jose | G |   |   | 4,378 |   | 10,216 |   | 704 |   | 4,378 |   | 10,920 |   | 15,298 |   | 2,759 |   | 1/00 |   | M |
| 1762 Automation Parkway                                   | San Jose | G |   |   | 4,804 |   | 12,224 |   | 1,332 |   | 4,804 |   | 13,556 |   | 18,360 |   | 3,454 |   | 4/00 |   | M |
| 1768 Automation Parkway                                   | San Jose | H |   |   | 8,195 |   | 19,121 |   | 218 |   | 8,195 |   | 19,339 |   | 27,534 |   | 4,525 |   | 12/00 |   | M |
| 255 Caspian Drive                                         | Sunnyvale |   |   |   | 3,491 |   | 7,160 |   | 1,658 |   | 3,491 |   | 8,818 |   | 12,309 |   | 2,546 |   | 4/00 |   | M |
| 245 Caspian Drive                                         | Sunnyvale |   |   |   | 5,894 |   | - |   |   |   | 5,894 |   | - |   | 5,894 |   | - |   | 4/01 |   | - |
| 5981 Optical Court                                        | San Jose | F |   |   | 4,054 |   | 14,938 |   | 298 |   | 4,054 |   | 15,236 |   | 19,290 |   | 1,754 |   | 1/08 |   | M |
| 5970 Optical Court                                        | San Jose |   |   |   | 2,758 |   | 8,395 |   |   |   | 2,758 |   | 8,395 |   | 11,153 |   | 1,259 |   | 12/03 |   | M |
| 5900 Optical Court                                        | San Jose |   |   |   | 3,634 |   | 12,677 |   | 83 |   | 3,634 |   | 12,760 |   | 16,394 |   | 2,460 |   | 7/02 |   | M |
| 2630 Orchard Parkway                                      | San Jose |   |   |   | 2,932 |   | 5,863 |   | 22 |   | 2,932 |   | 5,885 |   | 8,817 |   | 1,170 |   | 3/02 |   | M |
| 2610 Orchard Parkway                                      | San Jose | K |   |   | 2,615 |   | 5,231 |   |   |   | 2,615 |   | 5,231 |   | 7,846 |   | 1,025 |   | 3/02 |   | M |
| 55 West Trimble Road                                      | San Jose | K |   |   | 4,435 |   | 8,869 |   |   |   | 4,435 |   | 8,869 |   | 13,304 |   | 1,738 |   | 3/02 |   | M |
| 2001 Walsh Avenue                                         | Santa Clara | E,G,J |   |   | 4,610 |   | 3,887 |   |   |   | 4,610 |   | 3,887 |   | 8,497 |   | 661 |   | 4/03 |   | M |
| 2880 Scott Blvd                                           | Santa Clara | E,H,J |   |   | 14,501 |   | 22,555 |   | 471 |   | 14,501 |   | 23,026 |   | 37,527 |   | 3,911 |   | 4/03 |   | M |
| 2890 Scott Blvd                                           | Santa Clara | E,H,J |   |   | 3,081 |   | 9,696 |   | 25 |   | 3,081 |   | 9,721 |   | 12,802 |   | 1,648 |   | 4/03 |   | M |
| 2770-2800 Scott Blvd                                      | Santa Clara | E,H |   |   | 7,138 |   | 7,075 |   | 170 |   | 7,138 |   | 7,245 |   | 14,383 |   | 1,295 |   | 4/03 |   | M |
| 2300 Central Expressway                                   | Santa Clara | E,G,J |   |   | 2,390 |   | 2,459 |   | 50 |   | 2,390 |   | 2,509 |   | 4,899 |   | 423 |   | 4/03 |   | M |
| 2220 Central Expressway                                   | Santa Clara | E,G,J |   |   | 3,305 |   | 3,427 |   | 816 |   | 3,305 |   | 4,243 |   | 7,548 |   | 1,040 |   | 4/03 |   | M |
| 2330 Central Expressway                                   | Santa Clara | E,G |   |   | 3,673 |   | 3,932 |   | 692 |   | 3,673 |   | 4,624 |   | 8,297 |   | 1,340 |   | 4/03 |   | M |
| 233 South Hillview Drive                                  | Milpitas | F,O |   |   | 3,335 |   | 10,076 |   |   |   | 3,335 |   | 10,076 |   | 13,411 |   | 1,869 |   | 3/06 |   | M |
| 2251 Lawson Lane                                          | Santa Clara |   |   |   | 1,952 |   | 9,498 |   | 622 |   | 1,952 |   | 10,120 |   | 12,072 |   | 2,865 |   | 7/98 |   | M |
| 1230 East Arques                                          | Sunnyvale | F |   |   | 540 |   | 2,628 |   | 39 |   | 540 |   | 2,667 |   | 3,207 |   | 799 |   | 7/98 |   | M |
| 1250 East Arques                                          | Sunnyvale | F |   |   | 1,335 |   | 6,499 |   |   |   | 1,335 |   | 6,499 |   | 7,834 |   | 1,869 |   | 7/98 |   | M |
| 20400 Mariani Avenue                                      | Cupertino |   |   |   | 1,670 |   | 8,125 |   | 946 |   | 1,670 |   | 9,071 |   | 10,741 |   | 2,790 |   | 7/98 |   | M |
| 10500 De Anza Blvd                                        | Cupertino |   |   |   | 7,666 |   | 37,304 |   |   |   | 7,666 |   | 37,304 |   | 44,970 |   | 10,729 |   | 7/98 |   | M |
| 20605-20705 Valley Green Drive                            | Cupertino | G |   |   | 3,490 |   | 16,984 |   |   |   | 3,490 |   | 16,984 |   | 20,474 |   | 4,886 |   | 7/98 |   | M |
| 10300 Bubb Road                                           | Cupertino | F |   |   | 635 |   | 3,090 |   |   |   | 635 |   | 3,090 |   | 3,725 |   | 890 |   | 7/98 |   | M |
| 10440 Bubb Road                                           | Cupertino |   |   |   | 434 |   | 2,112 |   | 114 |   | 434 |   | 2,226 |   | 2,660 |   | 715 |   | 7/98 |   | M |
| 10460 Bubb Road                                           | Cupertino | H |   |   | 994 |   | 4,838 |   | 1,279 |   | 994 |   | 6,117 |   | 7,111 |   | 1,899 |   | 7/98 |   | M |
| 1135 Kern Avenue                                          | Sunnyvale |   |   |   | 407 |   | 1,982 |   |   |   | 407 |   | 1,982 |   | 2,389 |   | 573 |   | 7/98 |   | M |
| 450 National Avenue                                       | Mountain View |   |   |   | 611 |   | 2,973 |   | 72 |   | 611 |   | 3,045 |   | 3,656 |   | 910 |   | 7/98 |   | M |
| 3301 Olcott Street                                        | Santa Clara |   |   |   | 1,846 |   | 8,984 |   | 37 |   | 1,846 |   | 9,021 |   | 10,867 |   | 2,608 |   | 7/98 |   | M |
| 2800 Bayview Avenue                                       | Fremont |   |   |   | 1,070 |   | 5,205 |   | 60 |   | 1,070 |   | 5,265 |   | 6,335 |   | 1,558 |   | 7/98 |   | M |
| 5521 Hellyer Avenue                                       | San Jose |   |   |   | 4,534 |   | 9,650 |   |   |   | 4,534 |   | 9,650 |   | 14,184 |   | 1,465 |   | 2/05 |   | M |
| 6850 Santa Teresa Blvd                                    | San Jose | H |   |   | 377 |   | 1,836 |   | 819 |   | 377 |   | 2,655 |   | 3,032 |   | 1,004 |   | 7/98 |   | M |
| 6810 Santa Teresa Blvd                                    | San Jose | H |   |   | 2,567 |   | 5,991 |   | 772 |   | 2,567 |   | 6,763 |   | 9,330 |   | 2,067 |   | 3/99 |   | M |
| 140-160 Great Oaks Blvd                                   | San Jose |   |   |   | 1,402 |   | 6,822 |   | 754 |   | 1,402 |   | 7,576 |   | 8,978 |   | 2,437 |   | 7/98 |   | M |
| 6541 Via del Oro/6385 San Ignacio                         | San Jose | G |   |   | 1,039 |   | 5,057 |   | 81 |   | 1,039 |   | 5,138 |   | 6,177 |   | 1,520 |   | 7/98 |   | M |
| 6311-6351 San Ignacio Avenue                              | San Jose | F |   |   | 6,246 |   | 30,396 |   | 170 |   | 6,246 |   | 30,566 |   | 36,812 |   | 8,910 |   | 7/98 |   | M |
| 6320-6360 San Ignacio Avenue                              | San Jose | G |   |   | 2,616 |   | 12,732 |   | 439 |   | 2,616 |   | 13,171 |   | 15,787 |   | 3,887 |   | 7/98 |   | M |
| 75 E. Trimble Road/2610 N. First St                       | San Jose |   |   |   | 3,477 |   | 16,919 |   | 85 |   | 3,477 |   | 17,004 |   | 20,481 |   | 4,955 |   | 7/98 |   | M |
| 2904 Orchard Parkway                                      | San Jose | F,P |   |   | 4,704 |   | 11,992 |   |   |   | 4,704 |   | 11,992 |   | 16,696 |   | 909 |   | 2/08 |   | M |
| 3236 Scott Blvd                                           | Santa Clara | F |   |   | 1,234 |   | 6,005 |   |   |   | 1,234 |   | 6,005 |   | 7,239 |   | 1,728 |   | 7/98 |   | M |
| 1212 Bordeaux Lane                                        | Sunnyvale | F |   |   | 2,250 |   | 10,948 |   |   |   | 2,250 |   | 10,948 |   | 13,198 |   | 3,150 |   | 7/98 |   | M |
| 1325-1810 McCandless Drive                                | Milpitas |   |   |   | 13,994 |   | 66,213 |   | 1,455 |   | 13,994 |   | 67,668 |   | 81,662 |   | 19,988 |   | 7/98 |   | M |
| 1600 Memorex Drive                                        | Santa Clara | I |   |   | 1,221 |   | 5,940 |   | 11 |   | 1,221 |   | 5,951 |   | 7,172 |   | 1,696 |   | 7/98 |   | M |
| 1688 Richard Avenue                                       | Santa Clara | I |   |   | 1,248 |   | 2,913 |   | 6 |   | 1,248 |   | 2,919 |   | 4,167 |   | 843 |   | 9/98 |   | M |
| 1700 Richard Avenue                                       | Santa Clara | I |   |   | 1,727 |   | 4,030 |   |   |   | 1,727 |   | 4,030 |   | 5,757 |   | 1,053 |   | 8/99 |   | M |
| Morgan Hill Land                                          | Morgan Hill |   |   |   | 25,543 |   | - |   |   |   | 25,543 |   | - |   | 25,543 |   | - |   | 3/07 |   | - |
| Morgan Hill Land                                          | Morgan Hill |   |   |   | 2,297 |   | - |   |   |   | 2,297 |   | - |   | 2,297 |   | - |   | 4/07 |   | - |
| 300 Montague Expressway                                   | Milpitas |   |   |   | 2,609 |   | 2,499 |   |   |   | 2,609 |   | 2,499 |   | 5,108 |   | 167 |   | 4/07 |   | M |
| 337 Trade Zone Blvd                                       | Milpitas |   |   |   | 2,264 |   | 2,168 |   |   |   | 2,264 |   | 2,168 |   | 4,432 |   | 145 |   | 4/07 |   | M |
| 324-368 Montague Expressway                               | Milpitas |   |   |   | 2,968 |   | 2,843 |   |   |   | 2,968 |   | 2,843 |   | 5,811 |   | 190 |   | 4/07 |   | M |
| 3506-3510 Bassett Street                                  | Santa Clara | D |   |   | 943 |   | 4,591 |   | 182 |   | 943 |   | 4,773 |   | 5,716 |   | 1,450 |   | 7/98 |   | M |
| 3540-3544 Bassett Street                                  | Santa Clara | F,D |   |   | 1,565 |   | 7,616 |   | 261 |   | 1,565 |   | 7,877 |   | 9,442 |   | 2,274 |   | 7/98 |   | M |
| 3550 Bassett Street                                       | Santa Clara | F,D |   |   | 1,079 |   | 5,251 |   | 33 |   | 1,079 |   | 5,284 |   | 6,363 |   | 1,546 |   | 7/98 |   | M |
| 3560 Bassett Street                                       | Santa Clara | F,D |   |   | 1,075 |   | 5,233 |   | 8 |   | 1,075 |   | 5,241 |   | 6,316 |   | 1,515 |   | 7/98 |   | M |
| 3570-3580 Bassett Street                                  | Santa Clara | F,D |   |   | 1,075 |   | 5,233 |   |   |   | 1,075 |   | 5,233 |   | 6,308 |   | 1,507 |   | 7/98 |   | M |
| Hartford Loan                                             | F | 111,485 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Northwestern Mutual Life Insurance Company                | G | 77,444 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allianz Life Insurance Company                            | H | 129,889 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Heritage Bank of Commerce Line of Credit                  |   | 14,466 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                      |   |   | $341,545 |   | $320,911 |   | $774,795 |   | $28,094 |   | $320,911 |   | $802,889 |   | $1,123,800 |   | $204,153 |   |   |   |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| (A) 16.67% of this property’s ownership is held by unaffiliated parties outside the operating partnerships of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |
| (B) 25% of this property’s ownership is held by unaffiliated parties outside the operating partnerships of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| (C) 50% of this property’s ownership is held by an affiliated party since September 2000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |
| (D) Part of the property group referred to as the Triangle Technology Park.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| (E) Part of the property group referred to as the San Tomas Technology Park.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |
| (F) Encumbered by the $111,485 Hartford loan - full amount of loan shown at the bottom of the schedule.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |
| (G) Encumbered by the $77,444 Northwestern Mutual Life Insurance Company loan - full amount of loan shown at the bottom of the schedule.                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |   |   |   |   |   |   |   |
| (H) Encumbered by the $129,889 Allianz Life Insurance Company loan - full amount of loan shown at the bottom of the schedule.                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |
| (I) Encumbered by the $14,466 Heritage Bank of Commerce Line of Credit loan - full amount of loan shown at the bottom of the schedule.                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |
| (J) Purchase price allocated to real estate related intangible assets amounted to $18,284. Approximately $17,410 and $874 was fully amortized in 2007 and 2005, respectively, and the asset cost and its related accumulated amortization was removed from the accounts.                                                                                                                                                                                                                                                                                                                              |   |   |   |   |   |   |   |   |
| (K) Purchase price allocated to real estate related intangible assets amounted to $1,367. The amount was fully amortized in 2004 and the asset cost and its related accumulated amortization was removed from the accounts.                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |
| (L) This property was sold in October 2005. The Company retained 32.5%, or approximately 7.9 acres, of raw land.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |
| (M) Depreciation is computed based on the following estimated lives:      1. Building shell and base building tenant improvements of newly acquired properties are being depreciated on a weighted average composite useful life of 40 years.      2. Real estate intangible assets allocated are being amortized over the remaining life of the underlying leases.      3. Tenant improvements, furniture and fixtures are being depreciated over their estimated useful lives ranging from 5 to 10 years. |   |   |   |   |
| (N) Purchase price allocated to real estate related intangible assets amounted to $745.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |
| (O) Purchase price allocated to real estate related intangible assets amounted to $1,374.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |
| (P) Purchase price allocated to real estate related intangible assets amounted to $1,121.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |   |   |

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| MISSION WEST PROPERTIES, INC.                             |
|-----------------------------------------------------------|
| Schedule III                                              |
| Real Estate and Accumulated Depreciation and Amortization |
| December 31, 2008                                         |
| (dollars in thousands)                                    |
|                                                      |   |   |   |   | Initial Cost |   |   | Total Cost |   |   |   |   |   |   |   |
|                                                      |   |   |   |   |   |   |   |   | Cost |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                      |   |   |   |   |   |   | Buildings |   | Subsequent to |   |   |   | Buildings |   |   |   | Accumulated |   |   |   |   |
|                                                      |   |   | December 31, 2008 |   |   |   | and |   | Construction/ |   |   |   | and |   |   |   | Depreciation |   | Date of |   | Depreciable |
| Property Name                                             | City |   | Encumbrances |   | Land |   | Improvements |   | Acquisition |   | Land |   | Improvements |   | Total |   | & Amortization |   | Acquisition |   | Life |
| 5300-5350 Hellyer Avenue                                  | San Jose | C | $8,761 |   | $5,742 |   | $11,442 |   |   |   | $5,742 |   | $11,442 |   | $17,184 |   | $2,467 |   | 5/00 |   | L |
| 10401-10411 Bubb Road                                     | Cupertino | A |   |   | 633 |   | 3,078 |   |   |   | 633 |   | 3,078 |   | 3,711 |   | 810 |   | 7/98 |   | L |
| 45365 Northport Loop                                      | Fremont |   |   |   | 2,447 |   | 5,711 |   | $11 |   | 2,447 |   | 5,722 |   | 8,169 |   | 1,189 |   | 10/00 |   | L |
| 45738 Northport Loop                                      | Fremont | F |   |   | 891 |   | 4,338 |   | 5 |   | 891 |   | 4,343 |   | 5,234 |   | 1,143 |   | 7/98 |   | L |
| 4050 Starboard Drive                                      | Fremont | F |   |   | 1,329 |   | 6,467 |   | 8 |   | 1,329 |   | 6,475 |   | 7,804 |   | 1,702 |   | 7/98 |   | L |
| 3501 W. Warren Ave/Fremont Blvd                           | Fremont |   |   |   | 1,866 |   | 9,082 |   | 1,382 |   | 1,866 |   | 10,464 |   | 12,330 |   | 3,656 |   | 7/98 |   | L |
| 48800 Milmont Blvd                                        | Fremont |   |   |   | 1,013 |   | 4,932 |   |   |   | 1,013 |   | 4,932 |   | 5,945 |   | 1,296 |   | 7/98 |   | L |
| 4750 Patrick Henry Drive                                  | Santa Clara | H |   |   | 1,604 |   | 7,805 |   | 405 |   | 1,604 |   | 8,210 |   | 9,814 |   | 2,390 |   | 7/98 |   | L |
| 3520 Bassett Street                                       | Santa Clara | D |   |   | 1,104 |   | 5,371 |   |   |   | 1,104 |   | 5,371 |   | 6,475 |   | 1,411 |   | 7/98 |   | L |
| 3530 Bassett Street                                       | Santa Clara | B,D |   |   | 849 |   | 4,133 |   |   |   | 849 |   | 4,133 |   | 4,982 |   | 1,086 |   | 7/98 |   | L |
| 5850-5870 Hellyer Avenue                                  | San Jose |   |   |   | 2,787 |   | 6,502 |   | 131 |   | 2,787 |   | 6,633 |   | 9,420 |   | 1,715 |   | 11/98 |   | L |
| 5750 Hellyer Avenue                                       | San Jose |   |   |   | 3,266 |   | 3,354 |   | 2,798 |   | 3,266 |   | 6,152 |   | 9,418 |   | 1,312 |   | 8/01 |   | L |
| 800 Embedded Way                                          | San Jose | K |   |   | 1,794 |   | - |   |   |   | 1,794 |   | - |   | 1,794 |   | - |   | 3/00 |   | - |
| 5500 Hellyer Avenue                                       | San Jose | F |   |   | 4,735 |   | 12,485 |   | 1,575 |   | 4,735 |   | 14,060 |   | 18,795 |   | 2,515 |   | 2/01 |   | L |
| 5550 Hellyer Avenue                                       | San Jose | F |   |   | 3,261 |   | 3,478 |   | 3,755 |   | 3,261 |   | 7,233 |   | 10,494 |   | 966 |   | 6/01 |   | L |
| 5400 Hellyer Avenue                                       | San Jose |   |   |   | 3,238 |   | 5,007 |   | 215 |   | 3,238 |   | 5,222 |   | 8,460 |   | 1,281 |   | 7/00 |   | L |
| 5325 Hellyer Avenue                                       | San Jose | H |   |   | 4,684 |   | 10,230 |   | 40 |   | 4,684 |   | 10,270 |   | 14,954 |   | 2,093 |   | 1/01 |   | L |
| 5345 Hellyer Avenue                                       | San Jose | H |   |   | 4,866 |   | 5,822 |   | 2,529 |   | 4,866 |   | 8,351 |   | 13,217 |   | 1,145 |   | 1/02 |   | L |
| 5905-5965 Silver Creek Valley Road                        | San Jose |   |   |   | 8,437 |   | 17,316 |   |   |   | 8,437 |   | 17,316 |   | 25,753 |   | 3,247 |   | 7/01 |   | L |
| 5905-5965 Silver Creek Valley Road                        | San Jose |   |   |   | 3,438 |   | 2,727 |   |   |   | 3,438 |   | 2,727 |   | 6,165 |   | 494 |   | 10/01 |   | L |
| 5845 Hellyer Avenue                                       | San Jose |   |   |   | 6,090 |   | 5,029 |   |   |   | 6,090 |   | 5,029 |   | 11,119 |   | 161 |   | 9/07 |   | L |
| 855 Embedded Way                                          | San Jose |   |   |   | 3,289 |   | 6,521 |   | 150 |   | 3,289 |   | 6,671 |   | 9,960 |   | 1,320 |   | 5/01 |   | L |
| 1065-1105 La Avenida Street                               | Mountain View |   |   |   | 46,832 |   | 109,275 |   | 65 |   | 46,832 |   | 109,340 |   | 156,172 |   | 26,649 |   | 4/99 |   | L |
| 1875 Charleston Road                                      | Mountain View | M |   |   | - |   | 2,615 |   |   |   | - |   | 2,615 |   | 2,615 |   | 519 |   | 4/06 |   | L |
| 1750 Automation Parkway                                   | San Jose | G |   |   | 4,789 |   | 11,174 |   | 315 |   | 4,789 |   | 11,489 |   | 16,278 |   | 2,729 |   | 7/99 |   | L |
| 1756 Automation Parkway                                   | San Jose | G |   |   | 4,378 |   | 10,216 |   | 704 |   | 4,378 |   | 10,920 |   | 15,298 |   | 2,434 |   | 1/00 |   | L |
| 1762 Automation Parkway                                   | San Jose | G |   |   | 4,804 |   | 12,224 |   | 1,332 |   | 4,804 |   | 13,556 |   | 18,360 |   | 2,961 |   | 4/00 |   | L |
| 1768 Automation Parkway                                   | San Jose | H |   |   | 8,195 |   | 19,121 |   | 218 |   | 8,195 |   | 19,339 |   | 27,534 |   | 3,977 |   | 12/00 |   | L |
| 255 Caspian Drive                                         | Sunnyvale |   |   |   | 3,491 |   | 7,160 |   | 1,658 |   | 3,491 |   | 8,818 |   | 12,309 |   | 2,243 |   | 4/00 |   | L |
| 245 Caspian Drive                                         | Sunnyvale |   |   |   | 5,894 |   | - |   |   |   | 5,894 |   | - |   | 5,894 |   | - |   | 4/01 |   | - |
| 5981 Optical Court                                        | San Jose | F |   |   | 4,054 |   | 14,938 |   | 298 |   | 4,054 |   | 15,236 |   | 19,290 |   | 874 |   | 1/08 |   | L |
| 5970 Optical Court                                        | San Jose |   |   |   | 2,758 |   | 8,395 |   |   |   | 2,758 |   | 8,395 |   | 11,153 |   | 1,049 |   | 12/03 |   | L |
| 5900 Optical Court                                        | San Jose |   |   |   | 3,634 |   | 12,677 |   | 83 |   | 3,634 |   | 12,760 |   | 16,394 |   | 2,133 |   | 7/02 |   | L |
| 2630 Orchard Parkway                                      | San Jose |   |   |   | 2,932 |   | 5,863 |   | 22 |   | 2,932 |   | 5,885 |   | 8,817 |   | 1,024 |   | 3/02 |   | L |
| 2610 Orchard Parkway                                      | San Jose | J |   |   | 2,615 |   | 5,231 |   |   |   | 2,615 |   | 5,231 |   | 7,846 |   | 894 |   | 3/02 |   | L |
| 55 West Trimble Road                                      | San Jose | J |   |   | 4,435 |   | 8,869 |   |   |   | 4,435 |   | 8,869 |   | 13,304 |   | 1,516 |   | 3/02 |   | L |
| 2001 Walsh Avenue                                         | Santa Clara | E,G,I |   |   | 4,610 |   | 3,887 |   |   |   | 4,610 |   | 3,887 |   | 8,497 |   | 564 |   | 4/03 |   | L |
| 2880 Scott Blvd                                           | Santa Clara | E,H,I |   |   | 14,501 |   | 22,555 |   | 471 |   | 14,501 |   | 23,026 |   | 37,527 |   | 3,300 |   | 4/03 |   | L |
| 2890 Scott Blvd                                           | Santa Clara | E,H,I |   |   | 3,081 |   | 9,696 |   | 25 |   | 3,081 |   | 9,721 |   | 12,802 |   | 1,402 |   | 4/03 |   | L |
| 2770-2800 Scott Blvd                                      | Santa Clara | E,H |   |   | 7,138 |   | 7,075 |   | 170 |   | 7,138 |   | 7,245 |   | 14,383 |   | 1,089 |   | 4/03 |   | L |
| 2300 Central Expressway                                   | Santa Clara | E,G,I |   |   | 2,390 |   | 2,459 |   |   |   | 2,390 |   | 2,459 |   | 4,849 |   | 356 |   | 4/03 |   | L |
| 2220 Central Expressway                                   | Santa Clara | E,G,I |   |   | 3,305 |   | 3,427 |   | 816 |   | 3,305 |   | 4,243 |   | 7,548 |   | 838 |   | 4/03 |   | L |
| 2330 Central Expressway                                   | Santa Clara | E,G |   |   | 3,673 |   | 3,932 |   | 677 |   | 3,673 |   | 4,609 |   | 8,282 |   | 799 |   | 4/03 |   | L |
| 233 South Hillview Drive                                  | Milpitas | F,N |   |   | 3,335 |   | 10,076 |   |   |   | 3,335 |   | 10,076 |   | 13,411 |   | 1,381 |   | 3/06 |   | L |
| 2251 Lawson Lane                                          | Santa Clara |   |   |   | 1,952 |   | 9,498 |   | 501 |   | 1,952 |   | 9,999 |   | 11,951 |   | 2,503 |   | 7/98 |   | L |
| 1230 East Arques                                          | Sunnyvale | F |   |   | 540 |   | 2,628 |   | 39 |   | 540 |   | 2,667 |   | 3,207 |   | 733 |   | 7/98 |   | L |
| 1250 East Arques                                          | Sunnyvale | F |   |   | 1,335 |   | 6,499 |   |   |   | 1,335 |   | 6,499 |   | 7,834 |   | 1,707 |   | 7/98 |   | L |
| 20400 Mariani Avenue                                      | Cupertino |   |   |   | 1,670 |   | 8,125 |   | 946 |   | 1,670 |   | 9,071 |   | 10,741 |   | 2,403 |   | 7/98 |   | L |
| 10500 De Anza Blvd                                        | Cupertino |   |   |   | 7,666 |   | 37,304 |   |   |   | 7,666 |   | 37,304 |   | 44,970 |   | 9,796 |   | 7/98 |   | L |
| 20605-20705 Valley Green Drive                            | Cupertino | G |   |   | 3,490 |   | 16,984 |   |   |   | 3,490 |   | 16,984 |   | 20,474 |   | 4,462 |   | 7/98 |   | L |
| 10300 Bubb Road                                           | Cupertino | F |   |   | 635 |   | 3,090 |   |   |   | 635 |   | 3,090 |   | 3,725 |   | 813 |   | 7/98 |   | L |
| 10440 Bubb Road                                           | Cupertino |   |   |   | 434 |   | 2,112 |   | 114 |   | 434 |   | 2,226 |   | 2,660 |   | 650 |   | 7/98 |   | L |
| 10460 Bubb Road                                           | Cupertino | H |   |   | 994 |   | 4,838 |   | 1,279 |   | 994 |   | 6,117 |   | 7,111 |   | 1,748 |   | 7/98 |   | L |
| 1135 Kern Avenue                                          | Sunnyvale |   |   |   | 407 |   | 1,982 |   |   |   | 407 |   | 1,982 |   | 2,389 |   | 524 |   | 7/98 |   | L |
| 450 National Avenue                                       | Mountain View |   |   |   | 611 |   | 2,973 |   | 72 |   | 611 |   | 3,045 |   | 3,656 |   | 821 |   | 7/98 |   | L |
| 3301 Olcott Street                                        | Santa Clara |   |   |   | 1,846 |   | 8,984 |   | 37 |   | 1,846 |   | 9,021 |   | 10,867 |   | 2,376 |   | 7/98 |   | L |
| 2800 Bayview Avenue                                       | Fremont |   |   |   | 1,070 |   | 5,205 |   | 60 |   | 1,070 |   | 5,265 |   | 6,335 |   | 1,428 |   | 7/98 |   | L |
| 5521 Hellyer Avenue                                       | San Jose |   |   |   | 4,534 |   | 9,650 |   |   |   | 4,534 |   | 9,650 |   | 14,184 |   | 1,162 |   | 2/05 |   | L |
| 6850 Santa Teresa Blvd                                    | San Jose | H |   |   | 377 |   | 1,836 |   | 819 |   | 377 |   | 2,655 |   | 3,032 |   | 934 |   | 7/98 |   | L |
| 6810 Santa Teresa Blvd                                    | San Jose | H |   |   | 2,567 |   | 5,991 |   | 772 |   | 2,567 |   | 6,763 |   | 9,330 |   | 1,772 |   | 3/99 |   | L |
| 140-160 Great Oaks Blvd                                   | San Jose |   |   |   | 1,402 |   | 6,822 |   | 754 |   | 1,402 |   | 7,576 |   | 8,978 |   | 2,206 |   | 7/98 |   | L |
| 6541 Via del Oro/6385 San Ignacio                         | San Jose | G |   |   | 1,039 |   | 5,057 |   | 81 |   | 1,039 |   | 5,138 |   | 6,177 |   | 1,380 |   | 7/98 |   | L |
| 6311-6351 San Ignacio Avenue                              | San Jose | F |   |   | 6,246 |   | 30,396 |   | 170 |   | 6,246 |   | 30,566 |   | 36,812 |   | 8,143 |   | 7/98 |   | L |
| 6320-6360 San Ignacio Avenue                              | San Jose | G |   |   | 2,616 |   | 12,732 |   | 439 |   | 2,616 |   | 13,171 |   | 15,787 |   | 3,548 |   | 7/98 |   | L |
| 75 E. Trimble Road/2610 N. First St                       | San Jose |   |   |   | 3,477 |   | 16,919 |   | 85 |   | 3,477 |   | 17,004 |   | 20,481 |   | 4,532 |   | 7/98 |   | L |
| 2904 Orchard Parkway                                      | San Jose | F,O |   |   | 4,704 |   | 11,992 |   |   |   | 4,704 |   | 11,992 |   | 16,696 |   | 413 |   | 2/08 |   | L |
| 3236 Scott Blvd                                           | Santa Clara | F |   |   | 1,234 |   | 6,005 |   |   |   | 1,234 |   | 6,005 |   | 7,239 |   | 1,578 |   | 7/98 |   | L |
| 1212 Bordeaux Lane                                        | Sunnyvale | F |   |   | 2,250 |   | 10,948 |   |   |   | 2,250 |   | 10,948 |   | 13,198 |   | 2,877 |   | 7/98 |   | L |
| 1325-1810 McCandless Drive                                | Milpitas |   |   |   | 13,994 |   | 66,213 |   | 1,455 |   | 13,994 |   | 67,668 |   | 81,662 |   | 18,258 |   | 7/98 |   | L |
| 1600 Memorex Drive                                        | Santa Clara |   |   |   | 1,221 |   | 5,940 |   | 11 |   | 1,221 |   | 5,951 |   | 7,172 |   | 1,547 |   | 7/98 |   | L |
| 1688 Richard Avenue                                       | Santa Clara |   |   |   | 1,248 |   | 2,913 |   | 6 |   | 1,248 |   | 2,919 |   | 4,167 |   | 770 |   | 9/98 |   | L |
| 1700 Richard Avenue                                       | Santa Clara |   |   |   | 1,727 |   | 4,030 |   |   |   | 1,727 |   | 4,030 |   | 5,757 |   | 952 |   | 8/99 |   | L |
| Morgan Hill Land                                          | Morgan Hill |   |   |   | 25,543 |   | - |   |   |   | 25,543 |   | - |   | 25,543 |   | - |   | 3/07 |   | - |
| Morgan Hill Land                                          | Morgan Hill |   |   |   | 2,297 |   | - |   |   |   | 2,297 |   | - |   | 2,297 |   | - |   | 4/07 |   | - |
| 300 Montague Expressway                                   | Milpitas |   |   |   | 2,609 |   | 2,499 |   |   |   | 2,609 |   | 2,499 |   | 5,108 |   | 104 |   | 4/07 |   | L |
| 337 Trade Zone Blvd                                       | Milpitas |   |   |   | 2,264 |   | 2,168 |   |   |   | 2,264 |   | 2,168 |   | 4,432 |   | 90 |   | 4/07 |   | L |
| 324-368 Montague Expressway                               | Milpitas |   |   |   | 2,968 |   | 2,843 |   |   |   | 2,968 |   | 2,843 |   | 5,811 |   | 118 |   | 4/07 |   | L |
| 3506-3510 Bassett Street                                  | Santa Clara | D |   |   | 943 |   | 4,591 |   | 182 |   | 943 |   | 4,773 |   | 5,716 |   | 1,320 |   | 7/98 |   | L |
| 3540-3544 Bassett Street                                  | Santa Clara | F,D |   |   | 1,565 |   | 7,616 |   | 195 |   | 1,565 |   | 7,811 |   | 9,376 |   | 2,070 |   | 7/98 |   | L |
| 3550 Bassett Street                                       | Santa Clara | F,D |   |   | 1,079 |   | 5,251 |   | 33 |   | 1,079 |   | 5,284 |   | 6,363 |   | 1,415 |   | 7/98 |   | L |
| 3560 Bassett Street                                       | Santa Clara | F,D |   |   | 1,075 |   | 5,233 |   | 8 |   | 1,075 |   | 5,241 |   | 6,316 |   | 1,384 |   | 7/98 |   | L |
| 3570-3580 Bassett Street                                  | Santa Clara | F,D |   |   | 1,075 |   | 5,233 |   |   |   | 1,075 |   | 5,233 |   | 6,308 |   | 1,376 |   | 7/98 |   | L |
| Hartford Loan                                             | F | 114,513 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Northwestern Mutual Life Insurance Company                | G | 81,308 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allianz Life Insurance Company                            | H | 135,087 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                      |   |   | $339,669 |   | $320,911 |   | $774,795 |   | $27,916 |   | $320,911 |   | $802,711 |   | $1,123,622 |   | $180,043 |   |   |   |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| (A) 16.67% of this property’s ownership is held by unaffiliated parties outside the operating partnerships of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |
| (B) 25% of this property’s ownership is held by unaffiliated parties outside the operating partnerships of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| (C) 50% of this property’s ownership is held by an affiliated party since September 2000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |
| (D) Part of the property group referred to as the Triangle Technology Park.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| (E) Part of the property group referred to as the San Tomas Technology Park.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |
| (F) Encumbered by the $114,513 Hartford loan - full amount of loan shown at the bottom of the schedule.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |
| (G) Encumbered by the $81,308 Northwestern Mutual Life Insurance Company loan - full amount of loan shown at the bottom of the schedule.                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |   |   |   |   |   |   |   |
| (H) Encumbered by the $135,087 Allianz Life Insurance Company loan - full amount of loan shown at the bottom of the schedule.                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |
| (I) Purchase price allocated to real estate related intangible assets amounted to $18,284. Approximately $17,410 and $874 was fully amortized in 2007 and 2005, respectively, and the asset cost and its related accumulated amortization was removed from the accounts.                                                                                                                                                                                                                                                                                                                              |   |   |   |   |   |   |   |   |
| (J) Purchase price allocated to real estate related intangible assets amounted to $1,367. The amount was fully amortized in 2004 and the asset cost and its related accumulated amortization was removed from the accounts.                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |
| (K) This property was sold in October 2005. The Company retained 32.5%, or approximately 7.9 acres, of raw land.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |
| (L) Depreciation is computed based on the following estimated lives:      1. Building shell and base building tenant improvements of newly acquired properties are being depreciated on a weighted average composite useful life of 40 years.      2. Real estate intangible assets allocated are being amortized over the remaining life of the underlying leases.      3. Tenant improvements, furniture and fixtures are being depreciated over their estimated useful lives ranging from 5 to 10 years. |   |   |   |   |
| (M) Purchase price allocated to real estate related intangible assets amounted to $745.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |
| (N) Purchase price allocated to real estate related intangible assets amounted to $1,374.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |
| (O) Purchase price allocated to real estate related intangible assets amounted to $1,121.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |   |   |

----

| MISSION WEST PROPERTIES, INC.                                                   |   |
|---------------------------------------------------------------------------------|--------|
| NOTE TO SCHEDULE III                                                            |   |
| December 31, 2009, 2008 and 2007                                                |   |
| (dollars in thousands)                                                          |   |
|                                                                            |   |   |   |   |   |   |   |   |   |
| 1. Reconciliation of real estate and accumulated depreciation and amortization: |   |   |   |   |
|                                                                            |   |   |   |   |   |   |   |   |   |
|                                                                            |   | 2009 |   |   | 2008 |   |   | 2007 |   |
| Investments in properties:                                                      |   |   |   |   |   |   |   |   |   |
|    Balance at beginning of year                                  |   | $ | 1,123,622 |   |   | $ | 1,078,936 |   |   | $ | 1,048,348 |   |
|    Additions                                                     |   |   | 178 |   |   |   | 42,157 |   |   |   | 58,972 |   |
|    Dispositions                                                  |   |   | - |   |   |   | - |   |   |   | (10,974 | ) |
|    Reclassification                                              |   |   | - |   |   |   | 2,529 |   |   |   | (17,410 | ) |
|    Balance at end of year                                        |   | $ | 1,123,800 |   |   | $ | 1,123,622 |   |   | $ | 1,078,936 |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Accumulated depreciation and amortization:                                      |   |   |   |   |   |   |   |   |   |   |   |   |
|    Balance at beginning of year                                  |   | $ | 180,043 |   |   | $ | 156,819 |   |   | $ | 149,459 |   |
|    Additions                                                     |   |   | 24,110 |   |   |   | 23,224 |   |   |   | 26,826 |   |
|    Dispositions                                                  |   |   | - |   |   |   | - |   |   |   | (2,056 | ) |
|    Reclassification                                              |   |   | - |   |   |   | - |   |   |   | (17,410 | ) |
|    Balance at end of year                                        |   | $ | 204,153 |   |   | $ | 180,043 |   |   | $ | 156,819 |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Net investments in properties                                                   |   | $ | 919,647 |   |   | $ | 943,579 |   |   | $ | 922,117 |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |

----

| (a)   | Evaluation of Disclosure Controls and Procedures |
|-----------------|--------------------------------------------------|

| (b)   | Management’s Report on Internal Control over Financial Reporting |
|-----------------|------------------------------------------------------------------------|

| (c)   | Changes in Internal Control over Financial Reporting |
|-----------------|------------------------------------------------------|

----

----

| (a)   | The following documents are filed as part of this report: |
|-----------------|-----------------------------------------------------------|

| 1.   | The consolidated financial statements are set forth in Item 8 of this Annual Report on Form 10-K. |
|----------------|---------------------------------------------------------------------------------------------------|

| 2.   | Schedule III - Real Estate and Accumulated Depreciation and Amortization as of December 31, 2009 and 2008, which can be found on pages 75 and 77, respectively. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.   | The exhibits listed on the Exhibit Index either are filed with this Annual Report on Form 10-K or have been filed previously with the SEC and are incorporated by reference to those prior filings. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)   | The exhibits required by Item 601 of Regulation S-K, including each management contract or compensatory plan or arrangement required to be filed as an exhibit to this form are listed under Item 15(a)(3). |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Date: March 16, 2010                                                                   | By: /s/ Carl E. Berg                                                    |
|----------------------------------------------------------------------------------------|-------------------------------------------------------------------------|
|        Carl E. Berg                                 |
|        Chief Executive Officer                      |
|                                                                                   |        (Principal Executive Officer) |
|                                                                                   |                                                                    |
|                                                                                   |                                                                    |
| Date: March 16, 2010                                                                   | By: /s/ Wayne N. Pham                                                   |
|        Wayne N. Pham                                |
|        Vice President of Finance and Controller     |
|        (Principal Financial and Accounting Officer) |

| Signature                                               | Title                                                                           | Date                                    |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   /s/  Carl E. Berg                                     Carl E. Berg             |    Chairman of the Board, Chief Executive Officer and Director                                                                                                                                                                                                                                                                                                                                                                                     |    March 16, 2010                                                                                                                                                                                       |
|   /s/  William A. Hasler                           William A. Hasler                                                               |    Director                                                                                                                                                                                                                                                                                                                                                                                                                                        |    March 16, 2010                                                                                                                                                                                       |
|   /s/  Lawrence B. Helzel                         Lawrence B. Helzel                                                                         |    Director                                                                                                                                                                                                                                                                                                                                                                                                                                        |    March 16, 2010                                                                                                                                                                                       |
|   /s/  Raymond V. Marino                       Raymond V. Marino                                                                                            |    President, Chief Operating Officer and Director                                                                                                                                                                                                                                                                                                                                                                                                 |    March 16, 2010                                                                                                                                                                                       |
|   /s/  Martin S. Roher                              Martin S. Roher                                                 |    Director                                                                                                                                                                                                                                                                                                                                                                                                                                        |    March 16, 2010                                                                                                                                                                                       |
|                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                                                                   |

----

| 3.2.1    |   | Articles of Amendment and Restatement of Mission West Properties, Inc. (1)                                                                                                                                      |
|----------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.2.2    |   | Amended and Restated Bylaws of Mission West Properties, Inc. as of December 18, 2007 (1a)                                                                                                                       |
| 4.1      |   | Description of Capital Stock (2)                                                                                                                                                                                |
| 4.1.1    |   | Specimen Common Stock certificate (2)                                                                                                                                                                           |
| 10.1.1   |   | Amended and Restated Agreement of Limited Partnership of Mission West Properties, L.P. (2b)                                                                                                                     |
| 10.1.2   |   | Amended and Restated Agreement of Limited Partnership of Mission West Properties, L.P. I (2b)                                                                                                                   |
| 10.1.3   |   | Amended and Restated Agreement of Limited Partnership of Mission West Properties, L.P. II (2b)                                                                                                                  |
| 10.1.4   |   | Amended and Restated Agreement of Limited Partnership of Mission West Properties, L.P. III (2b)                                                                                                                 |
| 10.2     |   | Exchange Rights Agreement between Mission West Properties and the Limited Partners(2b)                                                                                                                          |
| 10.3.1   |   | Not in use                                                                                                                                                                                                      |
| 10.3.2   |   | Not in use                                                                                                                                                                                                      |
| 10.3.3   |   | Not in use                                                                                                                                                                                                      |
| 10.3.4   |   | Not in use                                                                                                                                                                                                      |
| 10.4.1   |   | Acquisition Agreement, dated as of May 14, 1998, among Mission West Properties, certain partnerships and the Berg Group (as defined therein) (1)                                                                |
| 10.4.2   |   | Amendment of Acquisition Agreement, dated as of July 1, 1998 (1)                                                                                                                                                |
| 10.4.3   |   | Form of Partnership Interest Purchase Demand Note (1)                                                                                                                                                           |
| 10.5.1   |   | Stock Purchase Agreement dated as of May 4, 1998, between Mission West Properties and the purchasers of Common Stock in a private placement of 5,800,000 shares and Subscription Agreement relating to same (1) |
| 10.5.2   |   | Stock Purchase Agreement dated as of May 4, 1998 between Mission West Properties and the purchasers of Common Stock in a private placement of 695,058 shares and Subscription Agreement relating tosame (1)     |
| 10.5.3   |   | Form of Registration Rights Agreement for purchasers, who acquired shares of Common Stock under the May 4, 1998 Stock Purchase Agreements (3)                                                                   |
| 10.6     |   | Pending Projects Acquisition Agreement among Mission West Properties, the Operating Partnership and the Berg Group (2b)                                                                                         |
| 10.7     |   | Berg Land Holdings Option Agreement between Mission West Properties and certain members of the Berg Group (2b)                                                                                                  |
| 10.8     |   | Berg & Berg Enterprises, Inc. Sublease Agreement (1)                                                                                                                                                        |
| 10.9     |   | Not in use                                                                                                                                                                                                      |
| 10.10    |   | Not in use                                                                                                                                                                                                      |
| 10.11    |   | Not in use                                                                                                                                                                                                      |
| 10.12    |   | Lease Agreement with Apple Computer, Inc. (4a)                                                                                                                                                                  |
| 10.13    |   | Not in use                                                                                                                                                                                                      |
| 10.14    |   | Lease Agreement with Amdahl Corporation (4b)                                                                                                                                                                    |
| 10.15    |   | Hartford Fixed Rate Term Loan Agreement (5)                                                                                                                                                                     |
| 10.15.1  |   | Hartford Life Insurance Company Promissory Note (5)                                                                                                                                                             |
| 10.15.2  |   | Hartford Life and Annuity Insurance Company Promissory Note (5)                                                                                                                                                 |
| 10.15.3  |   | Hartford Life and Accident Insurance Company Promissory Note (5)                                                                                                                                                |
| 10.15.4  |   | Hartford-Mission West Properties, L.P. (Santa Clara) Deed of Trust, Security Agreement and Fixture Filing (5)                                                                                                   |
| 10.15.5  |   | Hartford-Mission West Properties, L.P. (Alameda) Deed of Trust, Security Agreement and Fixture Filing(5)                                                                                                        |
| 10.15.6  |   | Hartford-Mission West Properties, L.P. I Deed of Trust, Security Agreement and Fixture Filing (5)                                                                                                               |
| 10.15.7  |   | Hartford-Mission West Properties, L.P. II Deed of Trust, Security Agreement and Fixture Filing (5)                                                                                                              |
| 10.15.8  |   | Hartford-Mission West Properties, L.P. III Deed of Trust, Security Agreement and Fixture Filing (5)                                                                                                             |
| 10.15.9  |   | Hartford Carveout Indemnity Agreement (5)                                                                                                                                                                       |
| 10.15.10 |   | Hartford Environmental Indemnity Agreement (5)                                                                                                                                                                  |
| 10.19    |   | Waiver Agreement (6)                                                                                                                                                                                            |
| 10.20    |   | Ownership Limit Exemption Agreement dated December 29, 1998 between Mission West Properties and Dan and Paul McCarthy (7)                                                                                       |
| 10.21    |   | Lease Agreement with Microsoft Corporation, dated July 25, 1998 (8)                                                                                                                                             |
| 10.21.1  |   | Lease Agreement with Microsoft Corporation, dated December 23, 2004 (8a)                                                                                                                                        |
| 10.22    |   | Contribution Agreement (8)                                                                                                                                                                                      |

----

| 10.23   |   | Not in use                                                                                                             |
|---------|--------|------------------------------------------------------------------------------------------------------------------------|
| 10.24   |   | Not in use                                                                                                             |
| 10.25   |   | Not in use                                                                                                             |
| 10.26   |   | Supplemental Agreement among Mission West Properties, Inc., Carl E. Berg and Clyde J. Berg (9)                         |
| 10.27   |   | Berg Group Revolving Credit – $100,000,000 Secured Promissory Note (10) (Terminated)                             |
| 10.27.1 |   | Third Amendment to Berg Group $100,000,000 Revolving Line of Credit (11) (Terminated)                                  |
| 10.28   |   | Berg Group Deed of Trust Securing Revolving Promissory Note (12)                                                       |
| 10.29   |   | Berg Group Promissory Note, dated October 8, 2009 (20)                                                                 |
| 10.30   |   | Mission West Properties, LP Continuing Guaranty (13)                                                                   |
| 10.31   |   | Mission West Properties, LP II Continuing Guaranty (13)                                                                |
| 10.32   |   | Mission West Properties, L.P. Promissory Note to Northwestern Mutual Life Insurance Company (13)                       |
| 10.32.1 |   | Mission West Properties, L.P. First Amendment to Promissory Note to Northwestern Mutual Life Insurance Company (18)    |
| 10.33   |   | Mission West Properties, L.P. I Promissory Note to Northwestern Mutual Life Insurance Company (13)                     |
| 10.33.1 |   | Mission West Properties, L.P. I First Amendment to Promissory Note to Northwestern Mutual Life Insurance Company (18)  |
| 10.34   |   | Mission West Properties, L.P. II Promissory Note to Northwestern Mutual Life Insurance Company (13)                    |
| 10.34.1 |   | Mission West Properties, L.P. II First Amendment to Promissory Note to Northwestern Mutual Life Insurance Company (18) |
| 10.35   |   | Mission West Properties, L.P. Deed of Trust and Security Agreement (First Priority) (13)                               |
| 10.36   |   | Mission West Properties, L.P. Deed of Trust and Security Agreement (Second Priority) (13)                              |
| 10.36.1 |   | Mission West Properties, L.P. First Amendment to Deed of Trust and Security Agreement (18)                             |
| 10.37   |   | Mission West Properties, L.P. I Deed of Trust and Security Agreement (First Priority) (13)                             |
| 10.38   |   | Mission West Properties, L.P. I Deed of Trust and Security Agreement (Second Priority) (13)                            |
| 10.38.1 |   | Mission West Properties, L.P. I First Amendment to Deed of Trust and Security Agreement (18)                           |
| 10.39   |   | Mission West Properties, L.P. II Deed of Trust and Security Agreement (First Priority) (13)                            |
| 10.40   |   | Mission West Properties, L.P. II Deed of Trust and Security Agreement (Second Priority) (13)                           |
| 10.40.1 |   | Mission West Properties, L.P. II First Amendment to Deed of Trust and Security Agreement (18)                          |
| 10.41   |   | Mission West Properties, L.P. Absolute Assignment of Leases and Rents (First Priority) (13)                            |
| 10.42   |   | Mission West Properties, L.P. I Absolute Assignment of Leases and Rents (First Priority) (13)                          |
| 10.43   |   | Mission West Properties, L.P. II Absolute Assignment of Leases and Rents (First Priority) (13)                         |
| 10.44   |   | Mission West Properties L.P., L.P. I and L.P. II First Amendment to Contribution and Reimbursement Agreement (18)      |
| 10.45   |   | Not in use                                                                                                             |
| 10.46*  |   | 2004 Equity Incentive Plan (14)                                                                                        |
| 10.47   |   | Allianz Loan Secured Installment Note (15)                                                                             |
| 10.48   |   | Allianz Loan Deed of Trust, Security Agreement, Fixture Filing with Absolute Assignment of Rents(15)                   |
| 10.49   |   | Allianz Loan Limited Guaranty (15)                                                                                     |
| 10.50*  |   | Form of Non-statutory Stock Option Agreement with Dividend Rights under 2004 Equity IncentivePlan (15)                 |
| 10.51   |   | Allianz Loan II Secured Installment Note (16)                                                                          |
| 10.52   |   | Allianz Loan II Deed of Trust, Security Agreement, Fixture Filing with Absolute Assignment ofRents (16)                |
| 10.53   |   | Allianz Loan II Limited Guaranty (16)                                                                                  |
| 10.54   |   | Allianz Loan II Loan Modification Agreement (16)                                                                       |
| 10.55   |   | Allianz Loan II Loan Modification Agreement and Amendment of Deed of Trust (18)                                        |
| 10.56   |   | Heritage Bank of Commerce Revolving Credit Loan Agreement (19)                                                         |
| 10.56.1 |   | Heritage Bank of Commerce Revolving Credit Loan Change in Terms Agreement, dated April 17, 2008 (19)                   |
| 10.56.2 |   | Heritage Bank of Commerce Revolving Credit Loan Change in Terms Agreement, dated June 5, 2009 (19)                     |
| 10.56.3 |   | Heritage Bank of Commerce Revolving Credit Loan Change in Terms Agreement, dated August 20, 2009 (20)                  |
| 10.56.4 |   | Heritage Bank of Commerce Revolving Credit Loan Change in Terms Agreement, dated October 13, 2009 (20)                 |
| 10.57   |   | M&M Real Estate Control & Restructuring, LLC Promissory Note, dated April 14, 2009 (19)                        |
| 10.58   |   | M&M Real Estate Control & Restructuring, LLC Promissory Note, dated April 21, 2009 (19)                        |
| 10.59   |   | M&M Real Estate Control & Restructuring, LLC Promissory Note, dated July 1, 2009 (19)                          |

----

| 10.60                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | M&M Real Estate Control & Restructuring, LLC Promissory Note, dated October 2, 2009 (20)  |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------|
| 10.61                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | M&M Real Estate Control & Restructuring, LLC Promissory Note, dated October 23, 2009 (20) |
| 21.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | Subsidiaries of the Registrant (17)                                                               |
| 23.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | Consent of Independent Registered Public Accounting Firm                                          |
| 24.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | Powers of Attorney (included on the signature page hereto)                                        |
| 31.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | Certification of Chief Executive Officer pursuant to Rule 13a-14(a)                               |
| 31.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | Certification of Chief Operating Officer pursuant to Rule 13a-14(a)                               |
| 31.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | Certification of Chief Financial Officer pursuant to Rule 13a-14(a)                               |
| 32.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | Certificate Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                             |
|  *Management contract or compensatory plan or arrangement (1)         Incorporated herein by reference to the same-numbered exhibit to the Company’s Registration Statement on Form S-4/A filed on July 20, 1998 and declared effective on November 23, 1998 (Commission File No. 333-52835-99).(1a)        Incorporated herein by reference to Exhibit 3.2 to the current report on Form 8-K filed on December 20, 2007 (Commission File No. 000-25235).(2)         Incorporated herein by reference to the registration statement on Form 8-A/A filed on March 21, 2008 (Commission File No. 001-34000).(2a)       Incorporated herein by reference to the same numbered exhibit to the registration statement on Form 8-A/A filed on March 21, 2008 (Commission File No. 001-34000).(2b)       Incorporated herein by reference to the same-numbered exhibit to the Company’s Post-effective Amendment No. 1 to Registration Statement on Form S-4 filed on Form S-3 on February 11, 1999 (Commission File No. 333-52835-99).(3)       Incorporated herein by reference to Exhibit 10.8 to the Company’s Post-effective Amendment No. 1 to Registration Statement on Form S-4 filed on Form S-3 on February 11, 1999 (Commission File No. 333-52835-99).(4a)       Incorporated herein by reference to Exhibit 10.15 to the Company’s Registration Statement on Form S-4/A filed on June 17, 1998 and declared effective on November 23, 1998 (Commission File No. 333-52835).(4b)       Incorporated herein by reference to Exhibit 10.17 to the Company’s Registration Statement on Form S-4/A filed on June 17, 1998 and declared effective on November 23, 1998 (Commission File No. 333-52835).(5)         Incorporated herein by reference to the same-numbered exhibit to current report on Form 8-K filed on October 7, 2008 (Commission File No. 001-34000).(6)         Incorporated herein by reference to the same-numbered exhibit to the Registration Statement on Form S-4/A filed on November 16, 1998 and declared effective on November 23, 1998 (Commission File No. 333-52835-99).(7)         Incorporated herein by reference to the same numbered exhibit to the annual report on Form 10-K for 1998 filed on March 31, 1999 (Commission File No. 000-25235).(8)         Incorporated herein by reference to the same-numbered exhibit to current report on Form 8-K filed on May 14, 1999 (Commission File No. 000-25235).(8a)       Incorporated herein by reference to the same-numbered exhibit to the quarterly report on Form 10-Q filed on May 10, 2005 (Commission File No. 000-25235).(9)         Incorporated herein by reference to the same-numbered exhibit to the Registration Statement on Form S-11/A filed on June 15, 1999 (Commission File No. 333-80203).(10)       Incorporated herein by reference to the same-numbered exhibit to the quarterly report on Form 10-Q filed on November 13, 2001 (Commission File No. 000-25235).(11)       Incorporated herein by reference to the same-numbered exhibit to the quarterly report on Form 10-Q filed on August 12, 2003 (Commission File No. 000-25235).(12)       Incorporated herein by reference to the same numbered exhibit to the annual report on Form 10-K for 1999 filed on March 30, 2000 (Commission File No. 000-25235).(13)       Incorporated herein by reference to the same-numbered exhibit to the annual report on Form 10-K for 2002 filed on March 27, 2003 (Commission File No. 000-25235).(14)       Incorporated herein by reference to Appendix II to the Company’s Schedule 14A Proxy Statement filed with the Securities and Exchange Commission on October 22, 2004 (Commission File No. 000-25235).(15)       Incorporated herein by reference to the same-numbered exhibit to the quarterly report on Form 10-Q filed on May 10, 2005 (Commission File No. 000-25235).(16)       Incorporated herein by reference to the same-numbered exhibit to the quarterly report on Form 10-Q filed on August 9, 2005 (Commission File No. 000-25235).(17)       Incorporated herein by reference to the same-numbered exhibit to the annual report on Form 10-K for 1998 filed on March 31, 1999 (Commission File No. 000-25235).(18)       Incorporated herein by reference to the same-numbered exhibit to the annual report on Form 10-K for 2008 filed on March 16, 2009 (Commission File No. 000-25235).(19)       Incorporated herein by reference to the same-numbered exhibit to the quarterly report on Form 10-Q filed on August 7, 2009 (Commission File No. 000-25235).(20)       Incorporated herein by reference to the same-numbered exhibit to the quarterly report on Form 10-Q filed on November 9, 2009 (Commission File No. 000-25235). |   |
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                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  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