Table of Contents





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|------------------------------------------------------------------------------------------
|UNITED STATES                                                                             
|SECURITIES AND EXCHANGE COMMISSION                                                        
|WASHINGTON, DC 20549                                                                      
|                                                                                          
|                                                                                          
|                                                                                          
|FORM 10-Q                                                                                 
|                                                                                          
|                                                                                          
|                                                                                          
|(Mark One)                                                                                
|xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF
1934   
|                                                                                          
|For the quarterly
 period ended March 31, 2009                                            
|                                                                                          
|OR                                                                                        
|                                                                                          
|oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
 OF THE SECURITIES EXCHANGE ACT OF 1934
|                                                                                          
|For the transition
 period from _____ to _____                                            
|                                                                                          
|Commission file number
 000-53203                                                         
|                                                                                          
|                                                                                          
|                                                                                          
|AmREIT MONTHLY INCOME & GROWTH FUND IV, L.P.                                              
|(Exact Name of Registrant as Specified in Its Charter)                                    
|                                                                                          

|                                                 |                                     
|------------------------------------------------ | ------------------------------------
|Delaware                                         | 20-5685431                          
|(State or Other Jurisdiction of Incorporation or | (I.R.S. Employer Identification No.)
|Organization)                                    |                                     
|                                                 |                                     
|8
 Greenway Plaza, Suite 1000                    |                                     
|Houston,
 Texas                                  | 77046                               
|(Address of Principal Executive Offices)         | (Zip Code)                          
|                                                 |                                     

|                                                                                   
|-----------------------------------------------------------------------------------
|713-850-1400                                                                       
|(Registrants Telephone Number, Including Area Code)                               
|                                                                                   
|Not
 applicable                                                                    
|(Former Name, Former Address and Formal Fiscal Year, if Changed Since
 Last Report)
|                                                                                   
|                                                                                   

Indicate
by check mark whether the registrant: (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. YES x NO o

Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files). YES  ̈
NO  ̈

Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of large accelerated filer, accelerated filer and smaller
reporting company in Rule 12b-2 of the Exchange Act. (Check one):

|                                                                                                                                        |  | 
|--------------------------------------------------------------------------------------------------------------------------------------- |  | 
|Large
 accelerated filer  ̈         Accelerated
 filer  ̈              Non-accelerated
 filer  ̈              Smaller
 reporting company x
|(Do not check if smaller reporting company)                                                                                            

Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).  YES  ̈
NO x





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TABLE OF CONTENTS

|                               |           |                                                                                        |  |      | 
|------------------------------ | --------- | -------------------------------------------------------------------------------------- |  | ---- | 
|                               |           |                                                                                        |  | Page
|Part I  Financial Information |           |                                                                                       
|                               | Item 1 -  | Financial Statements and Notes                                                         |  | 1    | 
|                               | Item 2 -  | Managements Discussion and Analysis of Financial Condition and
 Results of Operations |  | 18   | 
|                               | Item 3 -  | Quantitative and Qualitative Disclosures About Market Risk                             |  | 21   | 
|                               | Item 4T - | Controls and Procedures                                                                |  | 21   | 
|                               |           |                                                                                        |  |      | 
|Part II  Other Information    |           |                                                                                        | 
|                               | Item 2 -  | Unregistered Sales of Equity Securities and Use of Proceeds                            |  | 22   | 
|                               | Item 6 -  | Exhibits                                                                               |  | 22   | 
|Signatures                     |           | 23                                                                                     | 
|Exhibit Index                  |           | 24                                                                                     | 

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Table of Contents

|                                                                                            |                      
|------------------------------------------------------------------------------------------- | ---------------------
|PART I
  FINANCIAL INFORMATION                                                            
|                                                                                            |                      
|ITEM 1.                                                                                     | FINANCIAL STATEMENTS.
|                                                                                            |                      
|AmREIT MONTHLY INCOME & GROWTH FUND IV, L.P. AND
 SUBSIDIARIES
 CONSOLIDATED BALANCE SHEETS
|(in thousands)                                                                             

|                                                                                                            |  |                 |        |                    |   |        |  
|----------------------------------------------------------------------------------------------------------- |  | --------------- | ------ | ------------------ | - | ------ | -
|                                                                                                            |  | March 31,
 2009 |        | December 31,
 2008 |  
|                                                                                                            |  | (unaudited)     |        |                    |   |       
|ASSETS                                                                                                      |  |                 |        |                    |   |        |  
|Real estate investments at cost:                                                                            |  |                 |        |                    |   |        |  
|Land                                                                                                        |  | $               | 30,922 |                    | $ | 30,927 |  
|Buildings                                                                                                   |  |                 | 30,908 |                    |   | 30,851 |  
|Tenant improvements                                                                                         |  |                 | 1,280  |                    |   | 1,286  |  
|                                                                                                            |  |                 | 63,110 |                    |   | 63,064 |  
|Less accumulated depreciation and
 amortization                                                             |  |                 | (2,291 | )                  |   | (1,914 | )
|                                                                                                            |  |                 | 60,819 |                    |   | 61,150 |  
|                                                                                                            |  |                 |        |                    |   |        |  
|Investment in non-consolidated entities                                                                     |  |                 | 11,949 |                    |   | 11,680 |  
|Acquired lease intangibles, net                                                                             |  |                 | 2,585  |                    |   | 2,967  |  
|Net real estate investments                                                                                 |  |                 | 75,353 |                    |   | 75,797 |  
|                                                                                                            |  |                 |        |                    |   |        |  
|Cash and cash equivalents                                                                                   |  |                 | 1,804  |                    |   | 1,011  |  
|Escrow deposits                                                                                             |  |                 | 426    |                    |   | 1,659  |  
|Tenant receivables, net                                                                                     |  |                 | 416    |                    |   | 223    |  
|Accounts receivable - related party                                                                         |  |                 | 157    |                    |   | 739    |  
|Deferred costs, net                                                                                         |  |                 | 174    |                    |   | 188    |  
|Other assets                                                                                                |  |                 | 68     |                    |   | 52     |  
|TOTAL ASSETS                                                                                                |  | $               | 78,398 |                    | $ | 79,669 |  
|                                                                                                            |  |                 |        |                    |   |        |  
|LIABILITIES AND CAPITAL                                                                                     |  |                 |        |                    |   |        |  
|Liabilities:                                                                                                |  |                 |        |                    |   |        |  
|Notes payable                                                                                               |  | $               | 30,000 |                    | $ | 30,000 |  
|Accounts payable and other liabilities                                                                      |  |                 | 806    |                    |   | 369    |  
|Accounts payable - related party                                                                            |  |                 | 168    |                    |   | 302    |  
|Derivative liability                                                                                        |  |                 | 1,175  |                    |   | 1,257  |  
|Asset retirement obligations                                                                                |  |                 | 535    |                    |   | 535    |  
|Acquired below-market lease intangibles,
 net                                                               |  |                 | 1,887  |                    |   | 2,004  |  
|Security deposits                                                                                           |  |                 | 114    |                    |   | 122    |  
|TOTAL LIABILITIES                                                                                           |  |                 | 34,685 |                    |   | 34,589 |  
|                                                                                                            |  |                 |        |                    |   |        |  
|Capital:                                                                                                    |  |                 |        |                    |   |        |  
|MIG IV Partners capital:                                                                                   |  |                 |        |                    |   |        |  
|General partner                                                                                             |  |                 |       |                    |   |       |  
|Limited partners, 1,989 and 1,991 units
 outstanding at March 31, 2009 and December 31, 2008,
 respectively |  |                 | 33,419 |                    |   | 34,631 |  
|Accumulated other comprehensive loss                                                                        |  |                 | (760   | )                  |   | (842   | )
|TOTAL MIG IV PARTNERS CAPITAL                                                                              |  |                 | 32,659 |                    |   | 33,789 |  
|                                                                                                            |  |                 |        |                    |   |        |  
|Non-controlling interests                                                                                   |  |                 | 11,054 |                    |   | 11,291 |  
|TOTAL CAPITAL                                                                                               |  |                 | 43,713 |                    |   | 45,080 |  
|                                                                                                            |  |                 |        |                    |   |        |  
|TOTAL LIABILITIES AND CAPITAL                                                                               |  | $               | 78,398 |                    | $ | 79,669 |  

See Notes to Consolidated
Financial Statements.

1

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Table of Contents

|                                                              
|--------------------------------------------------------------
|AmREIT MONTHLY INCOME & GROWTH FUND IV, L.P. AND
 SUBSIDIARIES
|CONSOLIDATED STATEMENTS OF OPERATIONS                         
|(in thousands)                                                
|(unaudited)                                                   

|                                                         |  |                              |       |      |   |      |  
|-------------------------------------------------------- |  | ---------------------------- | ----- | ---- | - | ---- | -
|                                                         |  | Three months ended March 31, |      
|                                                         |  | 2009                         |       | 2008 |  
|                                                         |  |                              |       |      |   |      |  
|Revenues:                                                |  |                              |       |      |   |      |  
|Rental income from operating leases                      |  | $                            | 1,314 |      | $ | 14   |  
|Total revenues                                           |  |                              | 1,314 |      |   | 14   |  
|                                                         |  |                              |       |      |   |      |  
|Expenses:                                                |  |                              |       |      |   |      |  
|General and administrative                               |  |                              | 15    |      |   | 16   |  
|General and administrative - related party               |  |                              | 68    |      |   | 30   |  
|Asset management fees - related party                    |  |                              | 108   |      |   | 105  |  
|Property expense                                         |  |                              | 433   |      |   |     |  
|Property management fees - related party                 |  |                              | 52    |      |   |     |  
|Legal and professional                                   |  |                              | 59    |      |   | 50   |  
|Depreciation and amortization                            |  |                              | 768   |      |   | 12   |  
|Total operating expenses                                 |  |                              | 1,503 |      |   | 213  |  
|                                                         |  |                              |       |      |   |      |  
|Operating
 loss                                          |  |                              | (189  | )    |   | (199 | )
|                                                         |  |                              |       |      |   |      |  
|Other income
 (expense):                                 |  |                              |       |      |   |      |  
|Interest and other income                                |  |                              | 8     |      |   | 154  |  
|Interest expense                                         |  |                              | (443  | )    |   | (6   | )
|Equity in losses from non-consolidated
 entities         |  |                              | (286  | )    |   | (705 | )
|Margin tax expense                                       |  |                              | (7    | )    |   | (1   | )
|Total other income (expense)                             |  |                              | (728  | )    |   | (558 | )
|                                                         |  |                              |       |      |   |      |  
|Net loss                                                 |  |                              | (917  | )    |   | (757 | )
|                                                         |  |                              |       |      |   |      |  
|Add: Net loss attributable to
 non-controlling interests |  |                              | 145   |      |   |     |  
|                                                         |  |                              |       |      |   |      |  
|Net loss
 attributable to MIG IV                         |  | $                            | (772  | )    | $ | (757 | )

See Notes to Consolidated
Financial Statements.

2

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Table of Contents

|                                                              
|--------------------------------------------------------------
|AmREIT MONTHLY INCOME & GROWTH FUND IV, L.P. AND
 SUBSIDIARIES
|CONSOLIDATED STATEMENT OF CAPITAL                             
|For the three months ended March 31, 2009                     
|(in thousands)                                                
|(unaudited)                                                   

|                                           |  |                          |    |                  |   |                                       |   |                            |      |       |   |        |   |   |        |  
|------------------------------------------ |  | ------------------------ | -- | ---------------- | - | ------------------------------------- | - | -------------------------- | ---- | ----- | - | ------ | - | - | ------ | -
|                                           |  | MIG IV Partners Capital |    |                  |   |                                       |   |                            |     
|                                           |  | General Partner          |    | Limited Partners |   | Accumulated Other
 Comprehensive Loss |   | Non-Controlling
 Interests |      | Total |  
|Balance at December 31, 2008               |  | $                        |   |                  | $ | 34,631                                |   | $                          | (842 | )     | $ | 11,291 |   | $ | 45,080 |  
|                                           |  |                          |    |                  |   |                                       |   |                            |      |       |   |        |   |   |        |  
|Redemptions                                |  |                          |   |                  |   | (62                                   | ) |                            |     |       |   |       |   |   | (62    | )
|Net loss (1)                               |  |                          | 4  |                  |   | (776                                  | ) |                            |     |       |   | (145   | ) |   | (917   | )
|Distributions                              |  |                          | (4 | )                |   | (374                                  | ) |                            |     |       |   |       |   |   | (378   | )
|Distributions to non-controlling interests |  |                          |   |                  |   |                                      |   |                            |     |       |   | (92    | ) |   | (92    | )
|Gain on derivative                         |  |                          |   |                  |   |                                      |   |                            | 82   |       |   |       |   |   | 82     |  
|                                           |  |                          |    |                  |   |                                       |   |                            |      |       |   |        |   |   |        |  
|Balance at March 31, 2009                  |  | $                        |   |                  | $ | 33,419                                |   | $                          | (760 | )     | $ | 11,054 |   | $ | 43,713 |  

|                                                 |                                                                                                                                                                                                                                                                                                                                                                           
|------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1)                                              | The
 allocation of net loss includes a curative allocation to increase the General
 Partners capital account by $12 for the three months ended March 31, 2009.
 The cumulative curative allocation since inception of the Partnership is
 $102. The partnership agreement provides that no partner shall be required to
 fund a deficit balance in their capital account.
|                                                 |                                                                                                                                                                                                                                                                                                                                                                           
|See Notes to
 Consolidated Financial Statements.
|                                                 |                                                                                                                                                                                                                                                                                                                                                                           
|3                                               

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|                                                              
|--------------------------------------------------------------
|AmREIT MONTHLY INCOME & GROWTH FUND IV, L.P. AND
 SUBSIDIARIES
|CONSOLIDATED STATEMENTS OF CASH FLOWS                         
|(in thousands)                                                
|(unaudited)                                                   

|                                                                                                                                                                                    |  |                              |       |      |   |        |  
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------- | ----- | ---- | - | ------ | -
|                                                                                                                                                                                    |  | Three months ended March 31, |      
|                                                                                                                                                                                    |  | 2009                         |       | 2008 |  
|Cash flows from operating activities:                                                                                                                                               |  |                              |       |      |   |        |  
|Net loss                                                                                                                                                                            |  | $                            | (772  | )    | $ | (757   | )
|Adjustments to reconcile net loss to net
 cash provided by (used in) operating activities:                                                                                          |  |                              |       |      |   |        |  
|Bad debt expense                                                                                                                                                                    |  |                              | 8     |      |   |       |  
|Loss from non-consolidated entities                                                                                                                                                 |  |                              | 286   |      |   | 705    |  
|Depreciation and amortization                                                                                                                                                       |  |                              | 768   |      |   | 12     |  
|Amortization of above and below market
 leases, net                                                                                                                                 |  |                              | (108  | )    |   | (1     | )
|Amortization of loan acquisition costs                                                                                                                                              |  |                              | 24    |      |   |       |  
|Net loss attributable to non-controlling
 interests                                                                                                                                 |  |                              | (145  | )    |   |       |  
|Increase in escrow deposits                                                                                                                                                         |  |                              | (30   | )    |   | (390   | )
|Increase in tenant receivables                                                                                                                                                      |  |                              | (120  | )    |   |       |  
|Decrease in accounts receivable                                                                                                                                                     |  |                              |      |      |   | 3      |  
|Decrease (increase) in accounts receivable
 - related party                                                                                                                         |  |                              | 432   |      |   | (211   | )
|Increase in deferred costs                                                                                                                                                          |  |                              | (12   | )    |   |       |  
|Increase in other assets                                                                                                                                                            |  |                              | (16   | )    |   | (40    | )
|Increase in accounts payable and other
 liabilities                                                                                                                                 |  |                              | 356   |      |   | 105    |  
|Decrease in accounts payable - related
 party                                                                                                                                       |  |                              | (134  | )    |   | (613   | )
|Increase (decrease) in security deposits                                                                                                                                            |  |                              | (8    | )    |   | 48     |  
|Net cash provided by (used in) operating activities                                                                                                                                 |  |                              | 529   |      |   | (1,139 | )
|                                                                                                                                                                                    |  |                              |       |      |   |        |  
|Cash flows from investing activities:                                                                                                                                               |  |                              |       |      |   |        |  
|Improvements to real estate                                                                                                                                                         |  |                              | (62   | )    |   |       |  
|Acquisition of investment properties                                                                                                                                                |  |                              |      |      |   | (2,954 | )
|Investment in non-consolidated entities                                                                                                                                             |  |                              | (387  | )    |   | (4,818 | )
|Reimbursement of earnest money deposits                                                                                                                                             |  |                              | 1,245 |      |   |       |  
|Net cash provided by (used in) investing
 activities                                                                                                                                |  |                              | 796   |      |   | (7,772 | )
|                                                                                                                                                                                    |  |                              |       |      |   |        |  
|Cash flows from financing activities:                                                                                                                                               |  |                              |       |      |   |        |  
|Contributions                                                                                                                                                                       |  |                              |      |      |   | 4,899  |  
|Limited optional redemptions                                                                                                                                                        |  |                              | (62   | )    |   |       |  
|Issuance costs                                                                                                                                                                      |  |                              |      |      |   | (531   | )
|Loan acquisition costs                                                                                                                                                              |  |                              |      |      |   | (36    | )
|Distributions                                                                                                                                                                       |  |                              | (378  | )    |   | (867   | )
|Distributions to non-controlling interests                                                                                                                                          |  |                              | (92   | )    |   |       |  
|Net cash (used in) provided by financing
 activities                                                                                                                                |  |                              | (532  | )    |   | 3,465  |  
|                                                                                                                                                                                    |  |                              |       |      |   |        |  
|Net
 increase (decrease) in cash and cash equivalents                                                                                                                               |  |                              | 793   |      |   | (5,446 | )
|Cash and cash equivalents, beginning of
 period                                                                                                                                     |  |                              | 1,011 |      |   | 19,349 |  
|Cash and cash equivalents, end of period                                                                                                                                            |  | $                            | 1,804 |      | $ | 13,903 |  
|                                                                                                                                                                                    |  |                              |       |      |   |        |  
|Supplemental schedule of cash flow
 information:                                                                                                                                    |  |                              |       |      |   |        |  
|                                                                                                                                                                                    |  |                              |       |      |   |        |  
|Cash paid during the period for:                                                                                                                                                    |  |                              |       |      |   |        |  
|Interest                                                                                                                                                                            |  | $                            | 411   |      | $ | 7      |  
|                                                                                                                                                                                    |  |                              |       |      |   |        |  
|Supplemental schedule of noncash investing
 and financing activities:                                                                                                               |  |                              |       |      |   |        |  
|                                                                                                                                                                                    |  |                              |       |      |   |        |  
|During 2009, accounts receivable - related party of $168,000 from
 Shadow Creek Ranch was converted to equity, causing an increase in our
 investment in non-consolidated entities.

See Notes to
Consolidated Financial Statements.

4

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Table of Contents

AmREIT MONTHLY INCOME & GROWTH FUND IV,
L.P. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2009(unaudited)

|   |                                                 
|-- | ------------------------------------------------
|1. | DESCRIPTION OF BUSINESS AND NATURE OF OPERATIONS

AmREIT Monthly Income & Growth Fund IV, L.P., a Delaware limited
partnership (hereinafter referred to as the Partnership, MIG IV, we, us
or our), was formed on
October 10, 2006 to acquire, develop and operate, directly or indirectly
through joint venture arrangements, a portfolio of commercial real estate
consisting primarily of multi-tenant shopping centers and mixed-use
developments. The General Partner of the Partnership is AmREIT Monthly
Income & Growth IV Corporation, a Delaware corporation (the General
Partner), which is a subsidiary of AmREIT,
a non-traded Texas real estate investment trust that files reports with the
Securities and Exchange Commission (the SEC). The General Partner maintains
its principal place of business in Houston, Texas.

We commenced
our principal operations on December 8, 2006 when we acquired our first
interest in a property. On January 12, 2007, we accepted subscriptions for the
minimum offering of $1.0 million pursuant to
the terms of our Offering Memorandum dated November 15, 2006 (the Offering Memorandum) and issued the initial 40 limited
partnership units (the Units). We closed the offering on March 31, 2008 when
we had received $49.7 million from the
sale of 1,991 Units. As of March 31, 2009, our investments included a
wholly-owned property comprising 36,000 square feet of gross leasable area, two
properties in which we own controlling interests comprising 288,000 square feet
of gross leasable area and three properties in which we own investment
interests comprising 918,000 square feet of gross leasable area.

Our Units were sold pursuant to exemptions from registration under the
Securities Act of 1933, as amended, and are not currently listed
on a national exchange. These Units will be transferable only if we register them under applicable securities laws
(such registration is not expected) or pursuant to an exemption under the
Securities Act of 1933, as amended, and applicable state securities laws. We do
not anticipate that any public market for the Units will develop.

|   |                                           
|-- | ------------------------------------------
|2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS
OF PRESENTATION

Our financial
records are maintained on the accrual basis of accounting whereby revenues are
recognized when earned and expenses are recorded when incurred. The
consolidated financial statements include our accounts as well as the accounts
of any wholly- or majority-owned subsidiaries in which we have a controlling
financial interest (see Note 10). Investments in joint ventures and
partnerships in which we have the ability to exercise significant influence but
do not exercise financial and operating control are accounted for using the
equity method. As applicable, we consolidate certain joint ventures and
partnerships in which we own less than a 100% equity interest if the entity is
a variable interest entity and we are the primary beneficiary (as defined in
Financial Accounting Standards Board (FASB) Interpretation No. (FIN) 46(R):
Consolidation of Variable Interest Entities,
an Interpretation of ARB No. 51, as revised(FIN 46(R))).
Following consideration under FIN 46(R), if required, we also evaluate
applicable partially-owned entities under Emerging Issues Task Force Issue
No. 04-5: Determining Whether a General
Partner, or the General Partners as a Group, Controls a Limited Partnership or
Similar Entity when the Limited Partners Have Certain Rights, for
consolidation considerations. All significant inter-company accounts and
transactions have been eliminated in consolidation.

The
consolidated financial statements included in this report are unaudited;
however, amounts presented in the consolidated balance sheet as of December 31,
2008 are derived from our audited financial statements as of that date. In our
opinion, all adjustments necessary for a fair presentation of such financial
statements have been included. Such adjustments consisted of normal recurring
items.

5

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Table of Contents

REVENUE
RECOGNITION

We lease space
to tenants under agreements with varying terms. All of the leases are accounted
for as operating leases and, although certain leases of the properties provide
for tenant occupancy during periods for which no rent is due and/or increases
or decreases in the minimum lease payments over the terms of the leases,
revenue is recognized on a straight-line basis over the terms of the individual
leases. In most cases, revenue recognition under a lease begins when the lessee
takes possession of or controls the physical use of the leased asset.
Generally, possession or control occurs on the lease commencement date. In all
cases, we have determined that we are the owner of any tenant improvements that
we fund pursuant to the lease terms. In cases where significant tenant
improvements are made prior to lease commencement, the leased asset is
considered to be finished space, and revenue recognition therefore begins when
the improvements are substantially complete.

Accrued rents
are included in tenant receivables. Revenue from tenant reimbursements of
taxes, maintenance expenses and insurance is recognized in the period the
related expense is recorded. Additionally, certain of the lease agreements contain
provisions that grant additional rents based on tenants sales volumes
(contingent or percentage rent). Percentage rents are recognized when the
tenants achieve the specified targets as defined in their lease agreements. No
percentage rents were recognized during the three months ended March 31, 2009
and 2008. We recognize lease termination fees in the period that the lease is
terminated and collection of the fees is reasonably assured. No lease
termination fees were recognized during the three months ended March 31, 2009
and 2008. We record lease termination income if there is a signed termination
letter agreement, all of the conditions of the agreement have been met and
collectability is certain. Upon early lease termination, we provide for losses
related to unrecovered intangibles and other assets.

REAL ESTATE
INVESTMENTS

Development
Properties  Land, buildings and improvements
are recorded at cost. Expenditures related to the development of real estate
are carried at cost which includes capitalized carrying charges, acquisition
costs and development costs. Carrying charges, primarily interest, real estate
taxes and loan acquisition costs, and direct and indirect development costs
related to buildings under construction, are capitalized as part of construction
in progress. The capitalization of such costs ceases at the earlier of one year
from the date of completion of major construction or when the property, or any
completed portion, becomes available for occupancy.

Acquired Properties and Acquired Lease
Intangibles
 We account for real estate acquisitions pursuant to Statement of
Financial Accounting Standards (SFAS) No. 141 (revised 2007), Business Combinations (SFAS
No. 141R). Accordingly, we allocate the purchase price of the acquired
properties to land, building and improvements, identifiable intangible assets
and acquired liabilities based on their respective fair values. Identifiable
intangibles include amounts allocated to acquired above and below market
leases, the value of in-place leases and customer relationship value, if any.
We determine fair value based on estimated cash flow projections that utilize
appropriate discount and capitalization rates and available market information.
Estimates of future cash flows are based on a number of factors including the
historical operating results, known trends and specific market and economic
conditions that may affect the property. Factors considered by management in
our analysis of determining the as-if-vacant property value include an estimate
of carrying costs during the expected lease-up periods considering market
conditions and costs to execute similar leases. In estimating carrying costs,
management includes real estate taxes, insurance and estimates of lost rentals
at market rates during the expected lease-up periods, tenant demand and other
economic conditions. Management also estimates costs to execute similar leases
including leasing commissions, tenant improvements, legal and other related
expenses. Intangibles related to above market leases and in-place lease value
are recorded as acquired lease intangibles and are amortized as an adjustment
to rental revenue or amortization expense, as appropriate, over the remaining
terms of the underlying leases. Below market leases include fixed-rate renewal
periods. Premiums or discounts on acquired out-of-market debt are amortized to
interest expense over the remaining term of such debt.

We expense acquisition costs as incurred in accordance with SFAS No.
141R. Prior to adoption of SFAS No. 141R, such costs were capitalized and
expensed if and when the
acquisition became no longer probable. During the three months ended March 31, 2009 and 2008,
we expensed acquisition costs of $3,000 and $0, respectively. We did not
capitalize any interest or taxes during the same periods.

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Depreciation  Depreciation is computed using the straight-line
method over an estimated useful life
of up to 36 years for buildings, up to 11 years for site improvements and over
the term of lease for tenant improvements.

Properties Held for Sale  Properties will be classified as
held for sale if we have decided to market the property for immediate sale in its present condition with the belief
that the sale will be completed within one
year. Properties held for sale will be carried at the lower of cost or fair
value less cost to sell. Depreciation
and amortization are suspended during the held for sale period. As of March 31,
2009 and December 31, 2008, we had no properties held for sale.

Impairment  We
review our properties for impairment whenever events or changes in
circumstances indicate that the carrying amount of the assets, including
accrued rental income, may not be recoverable through operations. We determine
whether an impairment in value occurred by comparing the estimated future cash
flows (undiscounted and without interest charges), including the residual value
of the property, with the carrying value of the individual property. If
impairment is indicated, a loss will be recorded for the amount by which the
carrying value of the asset exceeds its fair value. Both the estimated
undiscounted cash flow analysis and fair value determination are based upon
various factors which require complex and subjective judgments to be made by
management. Such assumptions include projecting lease-up periods, holding
periods, cap rates, rental rates, operating expenses, lease terms, tenant
creditworthiness, tenant improvement allowances, terminal sales value and
certain macroeconomic factors among other assumptions to be made for each property.
We have not incurred any impairment losses since our inception.

ENVIRONMENTAL
EXPOSURES

We are subject to numerous environmental laws and regulations as they
apply to real estate, including those addressing chemicals used
by the dry cleaning industry, the existence of asbestos in older shopping
centers, and underground petroleum storage tanks. We believe that the tenants
occupying our properties who currently operate dry cleaning plants or gas stations do so in accordance with current laws
and regulations. We believe that the ultimate disposition of current
known environmental matters will not have a material affect on our financial position, liquidity, or operations (see
Note 11). However, we can give no assurance that existing environmental studies with respect to the
shopping centers have revealed all potential environmental liabilities; that any previous owner, occupant or
tenant did not create any material environmental condition not known to it;
that the current environmental condition of the shopping centers will not be
affected by tenants and occupants, by the condition of nearby
properties, or by unrelated third parties; or that changes in applicable environmental laws and regulations
or their interpretation will not result in additional environmental
liability to the Partnership.

RECEIVABLES AND
ALLOWANCE FOR UNCOLLECTIBLE ACCOUNTS

Tenant Receivables  Included
in tenant receivables are base rents, tenant reimbursements and adjustments
attributable to recording rents on a straight-line basis. An allowance for the
uncollectible portion of accrued rents and
accounts receivable is determined based upon customer credit-worthiness
(including expected recovery of our claim with respect to any tenants in
bankruptcy), historical bad debt levels and current economic trends. Bad debt
expenses and any related recoveries related to tenant receivables are included
in property expense. As of March 31, 2009 and December 31, 2008, our allowance
for uncollectible accounts related to our tenant receivables was $8,000
and $0, respectively.

Accounts
Receivable-Related Party  Included in accounts receivable-related party are
short-term cash advances provided to certain of our affiliated
investment entities primarily for their working capital needs. These cash
advances are due upon demand.

DERIVATIVE
FINANCIAL INSTRUMENTS

We account for
our derivative financial instruments pursuant to SFAS No. 133, Accounting for Derivative Instruments and Hedging
Activities(SFAS No. 133), as amended by SFAS No. 149, Amendment of Statement 133 on Derivative
Instruments
and Hedging Activities. SFAS No. 133 requires that all
derivative instruments, whether designated in hedging relationships or not, be
recorded on the balance sheet at their fair value. Gains or losses resulting
from changes in the values of those derivatives are accounted for depending on
the use of the derivative and whether it qualifies for hedge accounting. Our
use of derivative financial instruments to date has been limited to the use of
interest rate swaps to mitigate our interest rate risk on variable-rate debt.
We have designated these interest rate swaps as cash flow hedges for financial
reporting purposes.

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SFAS
No. 133 requires that changes in fair value of derivatives that qualify as
cash flow hedges be recognized in other comprehensive income (OCI) while the
ineffective portion of the derivatives change in fair value be recognized in
the statement of operations as interest expense. Upon the settlement of a
hedge, gains and losses associated with the transaction are recorded in OCI and
amortized over the underlying term of the hedge transaction. We assess, both at
inception of the hedge and on an ongoing basis, whether the derivatives that
are used in hedging transactions are highly effective in offsetting changes in
the cash flows of the hedged items. In assessing the hedge, we use standard
market conventions and techniques such as discounted cash flow analysis, option
pricing models and termination costs at each balance sheet date. All methods of
assessing fair value result in a general approximation of value, and such value
may never actually be realized. See Note 6 for further discussion.

DEFERRED COSTS

Deferred costs
include deferred leasing costs and loan acquisition costs, net of amortization.
Loan acquisition costs are incurred in obtaining financing and are amortized to
interest expense over the term of the debt agreements. Deferred leasing costs
consist of external commissions associated with leasing our properties and are
amortized to depreciation and amortization expense over the lease term.
Accumulated amortization related to loan acquisition costs totaled $145,000 and
$121,000 as of March 31, 2009 and December 31, 2008, respectively.
Accumulated amortization related to leasing costs totaled $7,000 and $5,000 as
of March 31, 2009 and December 31, 2008, respectively.

INCOME TAXES

Federal  No provision for U.S. federal
income taxes is included in the accompanying consolidated financial statements. As a partnership, we are
not subject to federal income tax, and the federal tax effect of our
activities is passed through to our partners.

State  In
May 2006, the State of Texas adopted House Bill 3, which modified the states
franchise tax structure, replacing
the previous tax based on capital or earned surplus with one based on margin
(often referred to as the Texas
Margin Tax) effective with franchise tax reports filed on or after January 1,
2007. The Texas Margin Tax is
computed by applying the applicable tax rate (1% for the Partnership) to the profit
margin, which, generally, will be determined for us as total revenue less a 30%
standard deduction. Although House Bill 3
states that the Texas Margin Tax is not an income tax, the Partnership believes
that SFAS No. 109, Accounting for Income Taxes, applies to the Texas Margin Tax. We
have recorded a margin tax provision of approximately $7,000 and $1,000 for the
Texas Margin Tax for the three months ended March 31, 2009 and 2008,
respectively.

USE OF ESTIMATES

The preparation of consolidated financial statements in conformity with
U.S. generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities as of the date
of the consolidated financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from
those estimates.

FAIR VALUE OF
FINANCIAL INSTRUMENTS

Our
consolidated financial instruments consist primarily of cash and cash
equivalents, tenant receivables, accounts receivable-related party, accounts
payable and other liabilities, accounts payable-related party, derivative
financial instrument and notes payable. The carrying value of cash and cash equivalents,
tenant receivables, accounts receivable-related party, accounts payable and
other liabilities, and accounts payable-related party are representative of their respective fair values due to the short-term
nature of these instruments. As of March 31, 2009 and December 31, 2008, the
carrying value of our total debt obligations was $30 million, $6.2 million of
which represents a fixed-rate obligation with an estimated fair value of $6.1
million as of March 31, 2009, based on a discounted cash flow analysis
using current market rates of interest. As of March 31, 2009, the estimated
fair value of our $23.8 million variable-rate obligation approximated $23.0
million, based on a discounted cash flow analysis using current market rates of
interest. We recorded our derivative financial instrument at its fair value of
$1,175,000 and $1,257,000 as of March 31,
2009 and December 31, 2008, respectively.

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SFAS No. 157, Fair Value Measurements(SFAS No. 157) defines a
hierarchy of inputs to valuation techniques based upon whether those inputs
reflect assumptions other market participants would use based upon market data
obtained from independent sources (observable inputs). The following summarizes
the fair value hierarchy defined within SFAS 157:

| |   |                                                                                                                                                                                  
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Level 1 Inputs  Quoted market prices (unadjusted) for identical
 assets and liabilities in an active market that the Company has the ability
 to access at the measurement date.
| |   |                                                                                                                                                                                  
| |  | Level 2 Inputs  Inputs, other than the quoted prices in active
 markets, that are observable either directly or indirectly.                                                     
| |   |                                                                                                                                                                                  
| |  | Level 3 Inputs  Inputs based on prices or valuation techniques that
 are both unobservable and significant to the overall fair value measurements.                              

SFAS No. 157 requires the use of observable market data, when
available, in making fair value measurements. Observable inputs are inputs that
the market participants would use in pricing the asset or liability developed
based on market data obtained from sources independent of ours. Unobservable
inputs are inputs that reflect our assumptions about the assumptions market
participants would use in pricing the asset or liability developed based on the
best information available in the circumstances. When inputs used
to measure fair value fall within different levels of the hierarchy, the level
within which the fair value measurement is categorized is based on the lowest
level input that is significant to the fair value measurement.

In determining
the fair value of our derivative instruments, we consider whether credit
valuation adjustments are necessary to appropriately reflect both our own
nonperformance risk and the respective counterpartys nonperformance risk in
the fair value measurements. Although we have determined that the majority of
the inputs used to value our derivatives fall within Level 2 of the fair value
hierarchy, the credit valuation adjustments associated
with its derivatives utilize Level 3 inputs, such as estimates of current
credit spreads to evaluate the likelihood of default by us and our counterparties.
However, as of March 31, 2009, we have assessed the significance of the impact
of the credit valuation adjustments on the overall valuation of our derivative
positions and have determined that the credit valuation adjustments are not
significant to the overall valuation of our derivatives. As a result, we have
determined that our derivative valuations in their entirety are classified in
Level 2 of the fair value hierarchy.

In determining
the value of our debt instruments, we determine the appropriate Treasury Bill
Rate based on the remaining time to maturity for each of the debt instruments.
We then add the appropriate yield spread to the Treasury Bill Rate. The yield
spread is a risk premium estimated by investors to account for credit risk involved
in debt financing. The spread is typically estimated based on the property type
and loan-to-value ratio of the debt instrument. The result is an estimate of
the market interest rate a typical investor would expect to receive given the
underlying subject asset (property type) and remaining time to maturity.

The following table presents our assets and
liabilities and related valuation inputs within the fair value hierarchy
utilized to measure fair value as of March 31, 2009 (in thousands):

|                      |  |         |   |         |   |         |  |   |        | 
|--------------------- |  | ------- | - | ------- | - | ------- |  | - | ------ | 
|                      |  | Level 1 |   | Level 2 |   | Level 3 | 
|Notes
 Payable        |  | $       |  |         | $ |        |  | $ | 29,091 | 
|Derivative
 Liability |  | $       |  |         | $ | 1,175   |  | $ |       | 

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NEW ACCOUNTING
STANDARDS

In September
2006, the FASB issued SFAS No. 157. SFAS No. 157 defines fair value,
establishes a framework for measuring fair value and requires enhanced
disclosures about fair value measurements. SFAS No. 157 requires companies to
disclose the fair value of financial instruments according to a fair value
hierarchy. Additionally, companies are required to provide certain disclosures
regarding instruments within the hierarchy, including a reconciliation of the
beginning and ending balances for each major category of assets and
liabilities. SFAS No. 157 is effective for our fiscal year beginning January 1,
2008, except for non-financial assets and liabilities that are not recognized
or disclosed at fair value on a recurring basis, for which the effective date
is our fiscal year beginning January 1, 2009. We adopted the provisions of SFAS
No. 157 for financial assets and liabilities as of January 1, 2008 and adopted
the provisions of SFAS No. 157 for non-financials assets and liabilities as of
January 1, 2009, and there was no material effect on our results of operations,
cash flows, or financial condition.

In February 2007, the FASB issued SFAS No.
159, The
Fair Value Option for Financial Assets and Financial Liabilities(SFAS
No. 159).
SFAS No. 159 expands opportunities to use fair value measurement in financial
reporting and permits entities to choose to measure many financial instruments
and certain other items at fair value. SFAS No. 159 is effective for fiscal
years beginning after November 15, 2007. We did not elect to measure any
eligible financial assets and liabilities at fair value under the provisions of
SFAS No. 159.

In December 2007, the FASB
issued SFAS No. 141R, which changes the accounting for business combinations.
Under SFAS No. 141R, an acquiring entity is required to recognize all the
assets acquired and liabilities assumed in a transaction at the
acquisition-date fair value with limited exceptions. SFAS No. 141R applies
prospectively to business combinations for which the acquisition date is on or
after the beginning of the first annual reporting period beginning on or after
December 15, 2008. We adopted the
provisions of SFAS No. 141R on January 1, 2009. Such adoption did not have an
impact on our results of operations, cash flows or financial condition as we
did not acquire any properties or entities during the three months ended March
31, 2009.

In December 2007, the FASB issued SFAS
No. 160, Noncontrolling Interests in Consolidated Financial Statementsan
amendment of ARB No. 51 (SFAS No. 160). SFAS No.
160 establishes accounting and reporting standards for the noncontrolling
interest in a subsidiary and for the deconsolidation of a subsidiary. SFAS No.
160 clarifies that a noncontrolling interest in a subsidiary is an ownership
interest in the consolidated entity that should be reported as equity in the
consolidated financial statements. SFAS No. 160 is effective for fiscal
years, and interim periods within those fiscal years, beginning on or after
December 15, 2008. SFAS No. 160 requires retroactive adoption of the
presentation and disclosure requirements for existing minority interests. All
other requirements of SFAS No. 160 shall be applied prospectively. Our
adoption of SFAS No. 160 caused our partners capital to increase as a result
of transferring the minority interest in our consolidated subsidiaries from the
mezzanine section of our balance sheet into equity.

In March 2008, the FASB issued SFAS No. 161, Disclosures
about Derivative Instruments and HedgingActivities 
an amendment of FASB Statement No. 133(SFAS No. 161). This statement
amends SFAS No. 133 to provide additional information about how derivative and
hedging activities affect an entitys financial position, financial performance
and cash flows. The statement requires enhanced disclosures about an entitys
derivatives and hedging activities. SFAS No. 161 will be effective for
financial statements issued for years beginning on or after November 15, 2008.
We adopted the provisions of SFAS No. 161 on January 1, 2009, and there was no
material impact on the results of our operations or financial position.

OFFERING COSTS

The General
Partner funded all of the organization and offering costs on the Partnerships
behalf. As of March 31, 2009, we had fully
reimbursed the General Partner for approximately $651,000 of organization and
offering costs. The offering costs, which include items such as legal and
accounting fees, marketing, and promotional
printing costs, are treated as a reduction of partners capital along with
sales commissions and dealer manager fees of 7.75% and 3.25%,
respectively (see Note 10).

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CASH AND CASH
EQUIVALENTS

We consider all highly-liquid debt instruments purchased with an
original maturity of three months or less to be cash equivalents. Cash and cash
equivalents consist of demand deposits at commercial banks and money market
funds.

INTEREST

Interest is charged to interest expense as it accrues. No interest has
been capitalized since inception of the Partnership.

SEGMENT REPORTING

SFAS No. 131, Disclosures about
Segments of an Enterprise and Related Information, establishes standards for reporting
financial and descriptive information about an enterprises reportable segments. We determined
that we have one reportable segment with activities related to investing in
real estate. Our investments in real estate generate rental revenue and other
income through the leasing of
multi-tenant retail properties, which comprised 100% of our total consolidated revenues
for all periods presented. We evaluate operating performance on an individual
property level. However, as each of our
properties have similar economic characteristics, tenants and products and services,
our properties have been aggregated into one reportable segment.

RECLASSIFICATIONS

Certain prior
period amounts in the consolidated financial statements have been reclassified
to conform to the presentation used in the current period consolidated
financial statements.

|   |                                          
|-- | -----------------------------------------
|3. | INVESTMENTS IN NON-CONSOLIDATED
 ENTITIES

Since inception, we have made the following investments in three
entities through which we own an interest in three properties:

| |   |                                                                                                                                                                                                                                                                                                                                                     
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | In December 2006, we acquired a 50% interest in AmREIT
 Casa Linda, LP which owns Casa Linda Plaza, a multi-tenant retail property
 located in Dallas, Texas with a combined gross leasable area of 325,000
 square feet. The remaining 50% is owned by AmREIT Monthly Income & Growth
 Fund III, Ltd., an affiliated AmREIT entity.                
| |   |                                                                                                                                                                                                                                                                                                                                                     
| |  | In December 2007, we
 acquired a 50% interest in Cambridge & Holcombe, LP which consists of raw
 land that will be developed into a multi-tenant retail property
 located in Houston, Texas. The
 remaining 50% is owned by an unaffiliated third party.                                                                                            
| |   |                                                                                                                                                                                                                                                                                                                                                     
| |  | In February 2008, we acquired a 10% interest in Shadow
 Creek Holding Company LLC which owns Shadow Creek Ranch, a multi-tenant
 retail property located in Pearland, Texas with a combined gross leasable
 area of 593,000 square feet. The remaining 90% is owned by an unaffiliated
 third party and REITPlus, Inc., an affiliated AmREIT entity.

We report our investments in these three entities using the equity
method of accounting due to our ability to exercise significant influence over
them. Combined condensed financial information for the underlying investee
entities (at 100%) is summarized as of and for the three ended March 31, 2009
and 2008 as follows (in thousands):

|                               |  |                              |        |      |   |       |  
|------------------------------ |  | ---------------------------- | ------ | ---- | - | ----- | -
|                               |  | Three months ended March 31, |       
|                               |  | 2009                         |        | 2008 |  
|Revenue                        |  | $                            | 3,044  |      | $ | 1,409 |  
|Depreciation
 and amortization |  |                              | (905   | )    |   | (565  | )
|Interest
 expense              |  |                              | (1,437 | )    |   | (848  | )
|Net loss                       |  |                              | (525   | )    |   | (307  | )

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|   |                           
|-- | --------------------------
|4. | ACQUIRED LEASE INTANGIBLES

In accordance with SFAS No. 141R, we have identified and recorded the
value of acquired lease intangibles at the property acquisition date. Such intangibles
include the value of acquired in-place leases and above and below market
leases. Acquired lease intangible
assets (in-place leases and above-market leases) are amortized over the leases remaining terms, which range from two months to
approximately thirteen years. The amortization of above-market leases is
recorded as a reduction of rental
income, and the amortization of in-place leases is recorded to amortization
expense. The amortization expense
related to in-place leases was approximately $373,000 and $7,000 for the three
months ended March 31, 2009 and 2008,
respectively. We recorded disposals related to in-place leases of $203,000 and $0 for the three months ended March
31, 2009 and 2008, respectively. The
amortization of above-market leases, which was recorded as a reduction of rental
income, was approximately $9,000 and $0 for
the three months ended March 31, 2009 and 2008, respectively. Acquired lease
intangible liabilities (below-market leases) are accreted over the
leases remaining non-cancelable lease term plus any fixed rate renewal
options, if applicable, which range
from two months to approximately thirteen years. Accretion of below-market
leases was approximately $117,000 and
$1,000 for the three months ended March 31, 2009 and 2008, respectively. Such accretion is recorded
as an increase to rental income. We recorded
disposals related to below-market leases of $35,000 and $0 for the three months ended March 31, 2009 and 2008,
respectively.

Acquired in-place lease and above and below market lease values and
their respective accumulated amortization are as follows (in thousands):

|                                                |  |                 |        |                    |   |        |  
|----------------------------------------------- |  | --------------- | ------ | ------------------ | - | ------ | -
|                                                |  | March 31,
 2009 |        | December 31,
 2008 |  
|Acquired
 lease intangible assets:              |  |                 |        |                    |   |        |  
|In-place
 leases                                |  | $               | 4,801  |                    | $ | 5,004  |  
|In-place
 leases  accumulated amortization     |  |                 | (2,330 | )                  |   | (2,160 | )
|Above-market
 leases                            |  |                 | 193    |                    |   | 193    |  
|Above-market
 leases  accumulated amortization |  |                 | (79    | )                  |   | (70    | )
|Acquired leases intangibles, net                |  | $               | 2,585  |                    | $ | 2,967  |  
|                                                |  |                 |        |                    |   |        |  
|Acquired
 lease intangible liabilities:         |  |                 |        |                    |   |        |  
|Below-market
 leases                            |  | $               | 2,605  |                    | $ | 2,640  |  
|Below-market
 leases  accumulated amortization |  |                 | (718   | )                  |   | (636   | )
|Acquired below-market lease intangibles,
 net   |  | $               | 1,887  |                    | $ | 2,004  |  

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|   |              
|-- | -------------
|5. | NOTES PAYABLE

Our outstanding debt at March 31, 2009 consisted
of two loans  a fixed-rate mortgage loan of $6.2 million secured by the Village on the Green property which matures
in April 2017 and a variable-rate mortgage loan of $23.8 million secured by the
Woodlake Square property which matures in September 2010, carries an interest
rate of LIBOR plus 1.35% (1.85% at March 31, 2009) and requires monthly
interest-only payments. We have entered into an interest rate swap agreement
which fixes the interest rate at 5.465% on our $23.8 million variable-rate
mortgage loan.

Interest-only
loans are generally due in full at maturity. Our
mortgage loans are secured by real estate properties and may be prepaid but could be subject to a
yield-maintenance premium or prepayment penalty. As of March 31, 2009, the weighted-average
interest rate on our fixed-rate debt is 5.5%, and the weighted average remaining life of such debt is 8 years.

As of March 31, 2009, scheduled principal repayments on
notes payable were as follows (in thousands):

|                           |            |                                |   |                       |  |                 |        |  |   |        | 
|-------------------------- | ---------- | ------------------------------ | - | --------------------- |  | --------------- | ------ |  | - | ------ | 
|Scheduled Payments by Year |            | Scheduled 
 Principal Payments |   | Term-Loan
 Maturities |  | Total
 Payments |       
|                           | 2009       |                                | $ | 51                    |  | $               |       |  | $ | 51     | 
|                           | 2010       |                                |   | 81                    |  |                 | 23,800 |  |   | 23,881 | 
|                           | 2011       |                                |   | 86                    |  |                 |       |  |   | 86     | 
|                           | 2012       |                                |   | 90                    |  |                 |       |  |   | 90     | 
|                           | 2013       |                                |   | 96                    |  |                 |       |  |   | 96     | 
|                           | Thereafter |                                |   | 353                   |  |                 | 5,443  |  |   | 5,796  | 
|                           | Total      |                                | $ | 757                   |  | $               | 29,243 |  | $ | 30,000 | 

We serve as
the guarantor of debt in the amount of $6.2 million that is the primary
obligation of our wholly-owned subsidiary. Additionally, we serve as the
guarantor of debt in the amount of $68.1 million that is the primary obligation
of our joint ventures.

|   |                                 
|-- | --------------------------------
|6. | DERIVATIVE FINANCIAL INSTRUMENTS

We use derivative instruments primarily to manage exposures to interest
rate risks. In order to manage the volatility relating to interest rate risk,
we may enter into interest rate swaps from time to time. We do not use
derivative financial instruments for trading or speculative purposes. In
December 2007, Woodlake Square entered into an interest rate swap with a
notional amount of $23.8 million and a fixed rate of 5.465% to hedge the
interest rate risk on the $23.8 million variable-rate loan that was placed in
conjunction with the 2007 acquisition of the Woodlake Square shopping
center. The fair value of the swap was a liability of $1,175,000 at March
31, 2009. The swap settles monthly with an amount paid to or received from our
counterparty upon settlement being recorded as an adjustment to interest
expense. For the three months ended March 31, 2009 and 2008, we paid
(received) $189,000 and $(10,000), respectively, related to this swap which is
included in interest expense.

Valuations are
not actual market prices for which an offer would be for unwinding any
transactions but rather are calculated mathematical approximations of market
values derived from proprietary models as of a given date. These valuations are
calculated on a mid-market basis and do not include bid/offered spread that
would be reflected in an actual price quotation; therefore, actual price
quotations for unwinding our transactions would be different. These valuations
and models rely on certain assumptions regarding past, present, and future
market conditions. These valuations, models and assumptions are subject to
change at any time. All methods of assessing fair value result in a general
approximation of value, and such value may never actually be realized.

We have designated our interest
rate swap as a hedge for financial reporting purposes. Accordingly, gains or losses resulting from changes in the
value of our derivates will be recorded as an adjustment to our partners
capital. We could be exposed to losses in
the event of nonperformance by the counterparties.

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|   |               
|-- | --------------
|7. | CONCENTRATIONS

As of March
31, 2009 and December 31, 2008, each of our three consolidated properties
individually comprises greater than 12% of
our consolidated total assets. Consistent with our strategy of investing in
areas that we know well, two of our
three properties are located in the Houston metropolitan area. These Houston
properties represent 78% and 0% of
our rental income for the three
months ended March 31, 2009 and 2008, respectively. Houston is Texas largest
city and the fourth largest city in the United States.

Following are the base rents generated by our top tenants during the three months ended March 31, 2009 and 2008 (in
thousands):

|                           |  |                               |      |  |      |   | 
|-------------------------- |  | ----------------------------- | ---- |  | ---- | - | 
|                           |  | Three
 months ended March 31,
|Tenant                     |  |                               | 2009 |  | 2008
|Borders                    |  | $                             | 209  |  | $    | 
|Walgreens                  |  |                               | 83   |  |      | 
|Randalls                  |  |                               | 61   |  |      | 
|Jos A. Bank                |  |                               | 52   |  |      | 
|Paesanos                  |  |                               | 46   |  |      | 3
|Alamo Heights Pediatrics   |  |                               | 18   |  |      | 1
|Theo & Herb Designer Shoes |  |                               | 12   |  |      | 1
|                           |  | $                             | 481  |  | $    | 5

|   |                                                 
|-- | ------------------------------------------------
|8. | PARTNERS CAPITAL AND NON-CONTROLLING
 INTERESTS

The General Partner invested $800,000 as a limited partner and $1,000
as a general partner in MIG IV. We began raising capital in December 2006. We closed the offering on March
31, 2008 when we had raised approximately $49.7 million. The General Partners $800,000 investment represents
a 1.6% limited partner interest in the Partnership.

Limited Optional
Redemption  Our Units were sold pursuant to exemptions from registration under the Securities Act of
1933, as amended, and are not currently listed on a national exchange or
otherwise traded in an organized securities market. These Units may be transferred only with consent
of the General Partner after delivery of required documents, and in any event,
only if we register the offer and sale of the Units under applicable securities
laws or if an exemption from such registration is available. We do not expect
to register the offer and sale of Units. Moreover, we do not anticipate
that any public market for the Units will develop. In order to provide limited partners with the possibility of liquidity, at
any time after November 15, 2009 and prior to November 15, 2013, limited
partners who have held their Units
for at least three years may receive the benefit of interim liquidity by
presenting all of those Units to the
Partnership for redemption. At that time, we may, at our sole election and
subject to the conditions and limitations described below, redeem the
Units presented for cash to the extent that we have sufficient funds available to us to fund such redemption.
The redemption price to be paid will be 92% of the limited partners
unreturned invested capital. At no time during a 12-month period, however, may
the number of Units redeemed by us exceed
2% of the number of Units outstanding at the beginning of that 12-month
period. We redeemed two Units during the three months ended March 31, 2009 for
$62,000 and zero Units during the three months ended March 31, 2008. These
redemptions were made pursuant to the hardship provisions as outlined in the
Offering Memorandum.

Distributions 
During the operating stage of the Partnership, net cash flow, as defined, will
be distributed 99% to the limited partners and 1% to the General Partner. We
paid a distribution of 7.5% per annum on invested capital through December
2008. Beginning on January 1, 2009, we will distribute 3.0% per annum on
invested capital during the operating stage of the Partnership. All distributions to date have been a return of
capital. During the liquidation stage of the Partnership (commencing in
November 2013, unless extended), net cash flow, as defined, will be distributed
among the limited partners and the General Partner in the following
manner:

| |   |                                                                                                                                                                                                                                                                                                           
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | First  100% to the
 limited partners (in proportion to their unreturned actual invested capital)
 until such time as the limited partners have received cumulative
 distributions from all sources equal to 100% of their actual invested capital
 (calculated using the actual purchase price per unit);

14

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| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Second  100% to the General Partner until it has received cumulative
 distributions from all sources equal to 100% of its actual invested capital of $1,000;                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |  | Third  1% to the
 General Partner and 99% to the limited partners on a per unit basis until
 such time as the limited partners have received cumulative distributions from
 all sources equal to 8.5% per annum, cumulative, uncompounded return
 on their unreturned deemed capital contributions (which will be equal to (i)
 the product of $25,000 per unit (regardless of the purchase price paid for a
 unit) multiplied by the number of units owned by a partner, reduced by (ii)
 the aggregate amount of any distributions received that constitute a return
 of capital contributions);
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |  | Fourth 
 100% to the General Partner until it has received cumulative distributions
 from all sources (other than with respect to the Units it purchased) in an
 amount equal to 40% of the net cash flow paid to date to the limited partners
 in excess of their actual invested capital; and                                                                                                                                                                                                                                                                                                   
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |  | Thereafter  60% to the limited partners on a per unit basis and 40%
 to the General Partner.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

Non-controlling Interests
Non-controlling interests
represent a 40% ownership interest that two of our affiliates have in two real estate partnerships that we
consolidate as a result of our 60% controlling financial interest in
such partnerships.

|   |                            
|-- | ---------------------------
|9. | RELATED PARTY
 TRANSACTIONS

Certain of our affiliates received fees and compensation during the
organizational stage of the Partnership, including securities commissions and
due diligence reimbursements, marketing reimbursements and reimbursement of
organizational and offering expenses. These affiliates also receive fees for
ongoing property management and administrative services. In the
event that these companies are unable to provide us with the respective
services, we would be required to find alternative providers of these services.
The following table summarizes the amount of such compensation paid
to our affiliates during the three months ended March 31, 2009 and 2008 (in
thousands):

|                                                                    |  |   |                                |  |      |     | 
|------------------------------------------------------------------- |  | - | ------------------------------ |  | ---- | --- | 
|                                                                    |  |   | Three months ended 
 March 31,
|Type of
 Service                                                    |  |   | 2009                           |  | 2008
|                                                                    |  |   |                                |  |      |    
|Securities
 Commissions, Due Diligence and Marketing Reimbursements |  | $ |                               |  | $    | 515
|Organizational
 and Offering Cost Reimbursements                    |  |   |                               |  |      | 15 
|Asset
 Management Fees                                              |  |   | 108                            |  |      | 105
|Development
 and Acquisition Fees                                   |  |   |                               |  |      | 264
|Property
 Management Fees and Leasing Costs                         |  |   | 63                             |  |      |   
|Administrative
 Costs Reimbursements                                |  |   | 68                             |  |      | 30 
|                                                                    |  | $ | 239                            |  | $    | 929

In
addition to the above fees paid by us, the non-consolidated entities in which we
have investments paid $130,000 and $52,000 in property management and leasing
fees to one of our affiliated entities for the three months ended March 31, 2009
and 2008, respectively. See also Note 3 regarding investments in
non-consolidated entities.

15

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Table of Contents

|    |                                          
|--- | -----------------------------------------
|10. | REAL ESTATE ACQUISITIONS AND DISPOSITIONS

In March 2008, we acquired Village on the Green, a multi-tenant retail
property located in San Antonio, Texas with a gross leasable area of 36,000
square feet. The acquisition
was accounted for as a purchase and the results of its operations are included
in the accompanying consolidated financial statements from the date of
acquisition.

In November 2007, we acquired a 40% interest in AmREIT Westheimer
Gessner, LP which owns Woodlake Pointe, a multi-tenant retail
property located in Houston, Texas with a combined gross leasable area of
82,120 square feet. In June 2008, we
acquired an additional 20% investment interest in AmREIT Westheimer Gessner, LP
from an affiliated entity at its net book value. Until June 2008, we reported our interest in AmREIT Westheimer Gessner,
LP under the equity method of accounting as we owned a 40% interest in the
partnership. With the additional 20% investment, we own a 60%
majority interest in this partnership, and we began including its financial
position and operations in our
consolidated financial statements beginning with our financial statements for
the quarter ended June 30, 2008 and effective as of January 1, 2008.

On May 30,
2008, we acquired a 60% interest in an additional tract of land adjacent to
AmREIT Westheimer Gessner, LP. The results of operations are included in the
accompanying consolidated financial statements from the date of acquisition.

In August 2007, we acquired a 40% interest in AmREIT Woodlake, LP which
owns Woodlake Square, a multi-tenant retail property located in
Houston, Texas with a combined gross leasable area of 206,000 square feet. In June 2008, we acquired an additional
investment interest of 20% in AmREIT Woodlake, LP from an affiliated entity at
its net book value. Until June 2008,
we reported our interest in AmREIT Woodlake, LP under the equity method of
accounting as we owned a 40% interest in the partnership. With
the additional 20% investment, we own a 60% majority interest in this
partnership, and we began including its financial position and operations in our consolidated financial
statements beginning with our financial statements for the quarter ended June
30, 2008 and effective as of January 1, 2008.

Included in
our results of operations before considering non-controlling interest for the
three months ended March 31, 2009 and 2008 are the following condensed combined
results for AmREIT Westheimer Gessner, LP and AmREIT Woodlake, LP (in
thousands):

|                                   |  |                              |       |   |      |        |   | 
|---------------------------------- |  | ---------------------------- | ----- | - | ---- | ------ | - | 
|                                   |  | Three months ended March 31, |      
|Combined
 Statements of Operations |  |                              | 2009  |   | 2008 |       
|                                   |  |                              |       |   |      |        |  
|Total revenues                     |  | $                            | 1,030 |   | $    | 1,095  |  
|Depreciation and amortization      |  |                              | 628   |   |      | 773    |  
|Operating income (loss)            |  |                              | 2     |   |      | (83    | )
|Interest expense                   |  |                              | 357   |   |      | 347    |  
|Net income (loss)                  |  |                              | (362  | ) |      | (1,399 | )

See Note 3 for a discussion of our investment activity since our
inception with respect to our non-consolidated entities.

|    |                               
|--- | ------------------------------
|11. | COMMITMENTS AND
 CONTINGENCIES

Litigation  In the ordinary course of
business, we may become subject to litigation or claims. There are no material
pending legal proceedings known to be contemplated against us.

Environmental matters  In connection with the ownership
and operation of real estate, we may be potentially
liable for costs and damages related to environmental matters. We have not been
notified by any governmental authority of any non-compliance, liability
or other claim.

16

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Table of Contents

In conjunction
with our acquisition of the Woodlake Square shopping center in August 2007, we
identified environmental exposures caused by businesses that operated on the
property prior to our ownership. We recorded an asset retirement obligation of
$700,000 on the acquisition date related to these exposures. In conjunction
with the acquisition, the seller placed $700,000 in escrow which approximated
the estimated remediation costs on the acquisition date. During 2008, we reassessed
our environmental exposure at the site and now believe that the estimated costs
to remediate the site will be approximately $535,000. Accordingly, we have
reduced the asset retirement obligation by $165,000 and released a
corresponding amount to the seller pursuant to the terms of the escrow
agreement. As of March 31, 2009, we have a remaining asset retirement
obligation related to this matter of $535,000. We believe that these matters
will not have a material adverse effect on our consolidated financial position
or results of operations, and we are aware of no other environmental exposures.

17

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Table of Contents

|        |                                                                                        
|------- | ---------------------------------------------------------------------------------------
|ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
 CONDITION AND RESULTS OF OPERATIONS.

The following discussion and
analysis should be read in conjunction with the accompanying consolidated
financial statements and notes thereto.

Our disclosure
and analysis in this Quarterly Report on Form 10-Q (this Quarterly Report)
contain forward-looking statements based on our current expectations or forecasts
of future events. Words such as believe, anticipate, expect, and intend
and similar expressions may identify forward-looking statements, but the
absence of these words does not necessarily mean that a statement is not
forward-looking. Forward-looking statements are subject to known and unknown
risks and uncertainties and are based on potentially inaccurate assumptions
that could cause actual results to differ materially from those expected or
implied by the forward-looking statements. Our actual results could differ
materially from those anticipated in the forward-looking statements for many
reasons. You should not unduly rely on these forward-looking statements which
speak only as of the date of this Quarterly Report. We undertake no obligation to
publicly revise any forward-looking statement to reflect circumstances or
events after the date of this Quarterly Report or to reflect the occurrence of
unanticipated events, except as may be required by law. You should, however,
review the factors and risks we describe in the reports we file from time to
time with the Securities and Exchange Commission (the SEC) after the date of
this Quarterly Report.

Overview

We are a Delaware limited partnership formed on October 10, 2006 to
acquire, develop and operate, directly or indirectly through joint venture arrangements,
a portfolio of commercial real estate consisting primarily of multi-tenant
shopping centers and mixed-use developments throughout the Southern and
Southwestern United States. Our investment strategy is to (1) sell
approximately 40% of our properties when appropriate and re-invest the net
sales proceeds into additional properties and (2) retain the remaining
properties as income-producing assets during our entire operating period. We focus on properties characterized by high
automobile traffic counts, high populations, high household incomes and limited
opportunities for competition.

We have no employees and are
managed by AmREIT Monthly & Income IV Corporation, our General Partner,
pursuant to our Partnership Agreement. Our General Partner is a wholly owned
subsidiary of AmREIT, a non-traded Texas real estate investment trust that
files reports with the SEC. We qualify as a partnership for federal income tax
purposes.

As of
March 31, 2009, our investments included a wholly-owned property comprising of
36,000 square feet of gross leasable area, two properties in which we own
controlling interests comprising of 288,000 square feet of gross leasable area
and three properties in which we own investment interests comprising of 918,000
square feet of gross leasable area. A majority of our properties
are located in highly-populated, suburban communities in Texas. We
derive a substantial portion of our revenue from rental income from these
properties, primarily from net leasing arrangements, where most of the
operating expenses of the properties are absorbed by our tenants. As a result,
our operating results and cash flows are primarily influenced by rental income
from our properties and interest expense on our property acquisition
indebtedness. Rental income accounted for 100% of our total revenue during the
three months ended March 31, 2009 and 2008. As of March 31, 2009, our
properties had an average occupancy rate of 72%, and the average debt leverage
ratio of the properties in which we have an investment was approximately 57%,
with 83% of such debt carrying a fixed-rate of interest.

Summary of Critical Accounting Policies

The
preparation of the consolidated financial statement information contained herein
requires management to make estimates and assumptions that affect the reported
amounts of assets, liabilities, net sales and expenses and related disclosure
of contingent assets and liabilities. Management bases its estimates on
historical experience and on various other assumptions that are believed to be
reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these
estimates under different assumptions or conditions.

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An accounting
policy is deemed to be critical if it requires an accounting estimate to be
made based on assumptions about matters that are highly uncertain at the time
the estimate is made, and if different estimates that reasonably could have
been used, or changes in the accounting estimates that are reasonably likely to
occur periodically, could materially impact the financial statements.
Information with respect to the Partnerships critical accounting policies that
the Partnership believes could have the most significant effect on the
Partnerships reported results and require subjective or complex judgments by
management is contained in Item 6. Financial Information  Managements
Discussion and Analysis or Plan of Operation of the Partnerships Annual
Report on Form 10-K for the fiscal year ended December 31, 2008. Management
believes that, as of March 31, 2009, there have been no material changes to
this information.

Results of Operations

We commenced
our principal operations on December 8, 2006 when we acquired our first
interest in a property. On January 12, 2007 we accepted subscriptions for the
minimum offering of $1.0 million pursuant to the terms of our Offering
Memorandum and issued the initial 40 Units to investors. During 2007, we made
investments in three joint ventures through which we obtained an ownership
interest in three properties. During 2008, we acquired a direct interest in one
property on March 25, 2008, made an investment in a joint venture through which
we obtained an ownership interest in one property and made additional
investments in two joint ventures through which we obtained additional
ownership interests in two properties. As of
March 31, 2009, our investments included a wholly-owned property comprised of
36,000 square feet of gross leasable area, two properties in which we owned
controlling interests comprised of 288,000 square feet of gross leasable area
and three properties in which we owned investment interests comprised of
918,000 square feet of gross leasable area.

Our direct property acquisition was accounted for as a purchase and the
results of its operations are included in our consolidated financial statements
from the date of acquisition. We report our investments in joint
ventures under the equity method of accounting given our ability to exercise
significant influence over them. Until June
2008, we reported our interest in AmREIT Woodlake, LP and AmREIT Westheimer
Gessner, LP under the equity method of accounting as we owned a 40% interest in
each. With the additional 20% investment that we made in these properties
during the second quarter of 2008, we are now consolidating their financial
position and the results of operations
in the accompanying consolidated financial statements. See
Note 3 to the financial statements included in this Quarterly Report for a
discussion of our investment activity since our inception with respect to our
non-consolidated entities.

Three Months Ended March 31, 2009 versus Three Months Ended
March 31, 2008

Revenue.Revenue
increased approximately $1.3 million to approximately $1.3 million during the
three months ended March 31, 2009 compared to $14,000 for the three months
ended March 31, 2008. This increase was due to rental income earned from
Village on the Green (acquired March 25, 2008), Woodlake Square (acquired
interest in August 2007 and June 2008) and Westheimer Gessner (acquired
interest in November 2007 and June 2008) during the three months ended March
31, 2009.

General & Administrative.General and administrative expenses stayed
relatively constant at approximately $15,000 for the three-month periods ended
March 31, 2009 and March 31, 2008.

General & Administrative  Related Party.General and
administrative  related party expenses paid to our affiliate increased
approximately $38,000 to approximately $68,000 during the three months
ended March 31, 2009 compared to
approximately $30,000 for the three months ended March 31, 2008. This increase was due to an increase in
the allocation of compensation costs during the period to better reflect the
level of effort expended by our affiliates financial personnel in providing
accounting and financial reporting services to us.

Asset Management Fees  Related Party.Asset
management fees  related party paid to our affiliate increased approximately
$3,000 to approximately $108,000 during the three months ended March 31, 2009
compared to approximately $105,000 for the three months ended March 31, 2008.
Asset management fees  related party increased slightly due to the increase in
assets under management as a result of our capital-raising efforts which we
completed in the first quarter of 2008.

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Property Expense. Property expense increased to approximately
$433,000 during the three months ended March 31, 2009 compared to $0 for the
three months ended March 31, 2008. This increase was due to property
expenses incurred by Village on the Green (acquired March 25, 2008), Woodlake
Square (acquired interest in August 2007 and June 2008) and Westheimer Gessner
(acquired interest in November 2007 and June 2008) during the three months
ended March 31, 2009.

Property Management Fees  Related Party. Property management fees  related party
increased to approximately $52,000 during the three months ended March 31, 2009
compared to $0 for the three months ended March 31, 2008. This increase
was due to property management fees incurred by Village on the Green (acquired
March 25, 2008), Woodlake Square (acquired interest in August 2007 and June
2008) and Westheimer Gessner (acquired interest in November 2007 and June 2008)
during the three months ended March 31, 2009.

Legal and Professional Fees.Legal
and professional fees increased approximately $9,000 to approximately $59,000
during the three months ended March 31, 2009 compared to approximately $50,000
for the three months ended March 31, 2008. The additional costs were primarily
attributable to audit fees associated with our filings with the SEC.

Depreciation and Amortization Expense.Depreciation
and amortization expense increased approximately $756,000 to approximately
$768,000 during the three months ended March 31, 2009 compared to $12,000 for
the three months ended March 31, 2008. This increase was due to depreciation
and amortization charges incurred by Village on the Green (acquired March 25,
2008), Woodlake Square (acquired interest in August 2007 and June 2008) and
Westheimer Gessner (acquired interest in November 2007 and June 2008) during
the three months ended March 31, 2009.

Interest and Other Income.
Interest and other income decreased approximately $146,000 to approximately
$8,000 during the three months ended March 31, 2009 compared to approximately
$154,000 for the three months ended March 31, 2008. This decrease was primarily
due to a lower balance of investable funds as these funds were invested in
Woodlake Square, Westheimer Gessner, and Village on the Green. We invest our excess cash in short-term investments or overnight funds
until
properties suitable for acquisition can be identified and acquired.

Interest Expense.Interest
expense increased approximately $437,000 to approximately $443,000 during the
three months ended March 31, 2009 compared to $6,000 for the three months ended
March 31, 2008. Interest expense incurred during the three months ended March
31, 2009 is related to notes payable on Village on the Green (acquired in March
25, 2008) and also to Woodlake Square (acquired interest in August 2007 and
June 2008), which we began consolidating during the second quarter of 2008 as a
result of our additional 20% investment in the property in June 2008. Woodlake
Square is encumbered by a $23.8 million variable-rate note payable. Also
included in interest expense is an expense of $218,000 related to our interest
rate swap for the three months ended March 31, 2009.

Equity in Losses From Non-Consolidated
Entities.Loss from non-consolidated entities
decreased approximately $419,000 to approximately $286,000 for the three months
ended March 31, 2009 compared to approximately $705,000 for the three months
ended March 31, 2008. These amounts represent our ownership portion of our
joint ventures net income or loss for the period. The decreased loss is
primarily attributable to Woodlake Square, which incurred a loss in the 2008
period, our portion of which we recorded under the equity method of accounting
during the three months ended March 31, 2008. We began consolidating Woodlake
Square during the second quarter of 2008 as a result of our additional 20%
investment in the property in June 2008.

Margin Tax Expense.
Margin tax expense increased approximately $6,000 to approximately $7,000
during the three months ended March 31, 2009 compared to $1,000 for the three
months ended March 31, 2008. This increase was due to increased taxable margin
generated by Village on the Green (acquired March 2008), Woodlake Square
(acquired interest in August 2007 and June 2008) and Westheimer Gessner
(acquired interest in November 2007 and June 2008) during the three months
ended March 31, 2009.

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Net Loss Attributable to Non-controlling
Interests. Net loss attributable to non-controlling
interests was approximately $145,000 during the three months ended March 31,
2009 compared to $0 for the three months ended March 31, 2008. This was due to
our consolidation of Woodlake Square and Westheimer Gessner as a result of our
additional 20% investment in each of these entities during the second quarter
of 2008.

Liquidity and Capital Resources

We expect to meet our short-term
liquidity requirements with cash on hand as well as through net cash provided
by property operations. We expect to meet our long-term liquidity requirements
through proceeds from secured or unsecured financings from banks and other
lenders, the selective and strategic sale of properties and net cash flows from
operations. We have no material refinancing obligations over the next twelve
months.

As of March
31, 2009 and December 31, 2008, our cash and cash equivalents totaled
approximately $1.8 million and approximately $1.0 million, respectively. Cash
flows provided by (used in) operating activities, investing activities and
financing activities for the three months ended March 31, 2009 and 2008 are as
follows (in thousands):

|                      |  |                              |      |      |   |        |  
|--------------------- |  | ---------------------------- | ---- | ---- | - | ------ | -
|                      |  | Three months ended March 31, |     
|                      |  | 2009                         |      | 2008 |  
|Operating
 activities |  | $                            | 529  |      | $ | (1,139 | )
|Investing
 activities |  |                              | 796  |      |   | (7,772 | )
|Financing
 activities |  |                              | (532 | )    |   | 3,465  |  

Net cash flows
provided by operating activities increased approximately $1.6 million to
approximately $529,000 for the three months ended March 31, 2009 compared to
net cash flows used in operating activities of approximately $1.1 million for
the three months ended March 31, 2008. This increase in operating cash inflows
was primarily attributable to an increase of $1.6 million in working capital
cash flows which was primarily driven by a net increase in payables of $730,000
coupled with a net decrease in receivables and in escrow deposits of $520,000
and $360,000, respectively.

Net cash flows provided by investing
activities increased approximately $8.6 million to approximately $796,000 for
the three months ended March 31, 2009 compared to net cash flows used in
investing activities of approximately $7.8 million for the three months ended
March 31, 2008. This increase in investing inflows was primarily due to a
decrease in the acquisition of investment properties: we invested $387,000 in
the Casa Linda Plaza property during the three months ended March 31, 2009
compared to investing $3.0 million in Village on the Green and $4.8 million in
Shadow Creek Ranch during the 2008 period. In addition to the reduction of
investing outflows, we received a net reimbursement of $1.2 million in earnest
money deposits during the three months ended March 31, 2009.

Net cash flows
used in financing activities increased approximately $4.0 million to
approximately $532,000 for the three months ended March 31, 2009 compared to
net cash flows provided by financing activities of approximately $3.5 million
for the three months ended March 31, 2008. This decrease in financing inflows
was primarily due to a reduction in contributions received of approximately
$4.4 million, net of issuance costs, as the offering was closed on March 31,
2008. Additionally, we had redemptions of $62,000 and made distributions of
$92,000 to non-controlling interests during the three months ended March 31,
2009. These outflows were partially offset by a decrease in distributions paid
to investors of $489,000, which resulted from the reduction in the distribution
rate from 7.5% to 3.0% per annum.

|        |                                                            
|------- | -----------------------------------------------------------
|ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable.

|         |                         
|-------- | ------------------------
|ITEM 4T. | CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and
Procedures

Under the
supervision and with the participation of our General Partners Chief Executive
Officer (CEO) and Chief Financial Officer (CFO), our General Partners
management has evaluated the effectiveness of the design and operation of our
disclosure controls and procedures (as defined in Rule 13a-15(e) or 15d-15(e)
of the Securities Exchange Act of 1934) as of March 31, 2009. Based on that
evaluation, our General Partners CEO and CFO concluded that, as of March 31,
2009, our disclosure controls and procedures were effective in causing material
information relating to us to be recorded, processed, summarized and reported
by management on a timely basis and to ensure the quality and timeliness of our
public disclosures with SEC disclosure obligations.

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Changes in Internal Controls

There has been
no change to our internal control over financial reporting during the quarter
ended March 31, 2009 that has materially affected, or is reasonably likely to
materially affect, our internal control over financial reporting.

PART II  OTHER INFORMATION

|        |                                                             
|------- | ------------------------------------------------------------
|ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

During the
three months ended March 31, 2009, we redeemed two Units. The following chart
summarizes the redemption of the two Units.

|                     |  |                                                    |  |                                           |        |                                                                                                  |   |                                                                                                                              |  
|-------------------- |  | -------------------------------------------------- |  | ----------------------------------------- | ------ | ------------------------------------------------------------------------------------------------ | - | ---------------------------------------------------------------------------------------------------------------------------- | -
|Period               |  | Total Number
 of Shares (or
 Units)
 Purchased (1) |  | Average
 Price Paid
 Per Share
 (or Unit) |        | Total Number of
 Shares (or Units)
 Purchased as Part
 of Publicly
 Announced Plans
 or Programs |   | Maximum Number (or
 Approximate Dollar
 Value) of Shares (or
 Units) that May Yet
 Be Purchased Under
 the Plans or Programs
|January
 1-31, 2009  |  |                                                   |  | $                                         |       |                                                                                                  |  |                                                                                                                              | 
|February
 1-28, 2009 |  | 2                                                  |  | $                                         | 30,939 |                                                                                                  |  |                                                                                                                              | 
|March 1-31,
 2009    |  |                                                   |  | $                                         |       |                                                                                                  |  |                                                                                                                              | 
|Total                |  | 2                                                  |  | $                                         | 30,939 |                                                                                                  |   |                                                                                                                              |  

(1) Our Agreement of Limited
Partnership contemplates that, at any time after November 15, 2009 and prior to
November 15, 2013, any limited partner who has held Units for at least three
years shall have the right to request that we redeem all of such Units. Despite
this temporal restriction, we redeemed two Units pursuant to the hardship
provisions as outlined in the Offering Memorandum.

|        |          
|------- | ---------
|ITEM 6. | EXHIBITS.

The exhibits listed on the
accompanying Exhibit Index are filed, furnished or incorporated by reference
(as stated therein) as part of this Quarterly Report on Form 10-Q.

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Table of Contents

SIGNATURES

Pursuant to
the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

|                    |                                                                             |                                                                     | 
|------------------- | --------------------------------------------------------------------------- | ------------------------------------------------------------------- | 
|                    | AmREIT
 Monthly Income & Growth Fund IV, L.P.                              
|                    |                                                                            
|                    | By:                                                                         | AmREIT Monthly Income & Growth IV
 Corporation, its General Partner
|                    |                                                                            
|Date: May
 15, 2009 |                                                                            
|                    | By:                                                                         | /s/ H. Kerr Taylor                                                 
|                    |                                                                             |                                                                     | 
|                    | H. Kerr Taylor                                                             
|                    | President, Chief Executive Officer and Director                            
|                    |                                                                            
|                    | By:                                                                         | /s/ Chad C. Braun                                                  
|                    |                                                                             |                                                                     | 
|                    | Chad C. Braun                                                              
|                    | Executive Vice President, Chief Financial Officer, Treasurer and
 Secretary

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Table of Contents

EXHIBIT INDEX

|               |                                                                                                                                                                                                                                                                 
|-------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit 3.1    | Certificate
 of Limited Partnership of AmREIT Monthly Income & Growth Fund IV, L.P.,
 dated October 10, 2006 (incorporated herein by reference from Exhibit 3.1 to
 the Partnerships Registration Statement on Form 10 dated April 29, 2008).                  
|               |                                                                                                                                                                                                                                                                 
|Exhibit 3.2    | Agreement of
 Limited Partnership of AmREIT Monthly & Income Growth Fund IV, L.P.,
 dated October 10, 2006 (incorporated herein by reference from Exhibit 3.2 to
 the Partnerships Registration Statement on Form 10 dated April 29, 2008).                    
|               |                                                                                                                                                                                                                                                                 
|Exhibit
 3.2.1 | Amendment
 No. 1 to Agreement of Limited Partnership of AmREIT Monthly & Income
 Growth Fund IV, L.P., dated December 7, 2006 (incorporated herein by reference
 from Exhibit 3.3 to the Partnerships Registration Statement on Form 10 dated
 April 29, 2008).
|               |                                                                                                                                                                                                                                                                 
|Exhibit 31.1   | Certification
 signed by the Chief Executive Officer of the Partnerships General Partner
 pursuant to Exchange Act Rule 13a-14(a) (filed herewith).                                                                                                            
|               |                                                                                                                                                                                                                                                                 
|Exhibit 31.2   | Certification
 signed by the Chief Financial Officer of the Partnerships General Partner
 pursuant to Exchange Act Rule 13a-14(a) (filed herewith).                                                                                                            
|               |                                                                                                                                                                                                                                                                 
|Exhibit 32.1   | Certification
 Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the
 Sarbanes-Oxley Act of 2002, signed by the Chief Executive Officer of the
 Partnerships General Partner (furnished herewith).                                     
|               |                                                                                                                                                                                                                                                                 
|Exhibit 32.2   | Certification
 Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the
 Sarbanes-Oxley Act of 2002, signed by the Chief Financial Officer of the
 Partnerships General Partner (furnished herewith).                                     

24

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