----

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|   | Maryland                                                      | 001-13100               | 56-1871668                             |   |
|--------|---------------------------------------------------------------|-------------------------|----------------------------------------|--------|
|   | (State or other jurisdictionof incorporation or organization) | (CommissionFile Number) | (I.R.S. EmployerIdentification Number) |   |

|   | North Carolina                                                | 000-21731               | 56-1869557                             |   |
|--------|---------------------------------------------------------------|-------------------------|----------------------------------------|--------|
|   | (State or other jurisdictionof incorporation or organization) | (CommissionFile Number) | (I.R.S. EmployerIdentification Number) |   |

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| PART I – FINANCIAL INFORMATION                                                                                       |     |
|----------------------------------------------------------------------------------------------------------------------------|----------|
|                                                                                                                       |     |
| ITEM 1.    FINANCIAL STATEMENTS                                                                        | 2        |
|                                                                                                                       |     |
| HIGHWOODS PROPERTIES, INC.:                                                                                                |     |
|                                                                                                                       |     |
| Consolidated Balance Sheets as of June 30, 2011 and December 31, 2010                                       | 3        |
|                                                                                                                       |     |
| Consolidated Statements of Income for the three and six months ended June 30, 2011 and 2010                      | 4        |
|                                                                                                                       |     |
| Consolidated Statements of Equity for the six months ended June 30, 2011 and 2010                                | 5        |
|                                                                                                                       |     |
| Consolidated Statements of Cash Flows for the six months ended June 30, 2011 and 2010                            | 6        |
|                                                                                                                       |     |
| Notes to Consolidated Financial Statements                                                                                 | 8        |
|                                                                                                                       |     |
| HIGHWOODS REALTY LIMITED PARTNERSHIP:                                                                                      |     |
|                                                                                                                       |     |
| Consolidated Balance Sheets as of June 30, 2011 and December 31, 2010                                       | 24       |
|                                                                                                                       |     |
| Consolidated Statements of Income for the three and six months ended June 30, 2011 and 2010                      | 25       |
|                                                                                                                       |     |
| Consolidated Statements of Equity for the six months ended June 30, 2011 and 2010                                | 26       |
|                                                                                                                       |     |
| Consolidated Statements of Cash Flows for the six months ended June 30, 2011 and 2010                            | 27       |
|                                                                                                                       |     |
| Notes to Consolidated Financial Statements                                                                                 | 29       |
|                                                                                                                       |     |
| ITEM 2.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 43       |
|                                                                                                                       |     |
| Disclosure Regarding Forward-Looking Statements                                                                            | 43       |
|                                                                                                                       |     |
| Executive Summary                                                                                                          | 44       |
|                                                                                                                       |     |
| Results of Operations                                                                                                      | 45       |
|                                                                                                                       |     |
| Liquidity and Capital Resources                                                                                            | 48       |
|                                                                                                                       |     |
| Critical Accounting Estimates                                                                                              | 51       |
|                                                                                                                       |     |
| Non-GAAP Information                                                                                                       | 51       |
|                                                                                                                       |     |
| ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                  | 55       |
|                                                                                                                       |     |
| ITEM 4.    CONTROLS AND PROCEDURES                                                                     | 55       |
|                                                                                                                       |     |
| PART II – OTHER INFORMATION                                                                                          |     |
|                                                                                                                       |     |
| ITEM 1A.  RISK FACTORS                                                                                           | 56       |
|                                                                                                                       |     |
| ITEM 2.    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS                                 | 63       |
|                                                                                                                       |     |
| ITEM 5.    OTHER EVENTS                                                                                |  63 |
|                                                                                                                       |     |
| ITEM 6.    EXHIBITS                                                                                    | 63       |

----

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|                                                                                                                                                            |   | June 30,2011 |      | December 31,2010 |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|-----------|-----------------------|--------|
| Assets:                                                                                                                                                         |   |              |      |                  |   |   |
| Real estate assets, at cost:                                                                                                                                    |   |              |      |                  |   |   |   |
| Land                                                                                                                                                            |   | $                 | 345,791   |                  | $      | 345,088 |   |
| Buildings and tenant improvements                                                                                                                               |   |              | 2,886,871 |                  |   | 2,883,092 |   |
| Development in process                                                                                                                                          |   |              | 13,317    |                  |   | 4,524 |   |
| Land held for development                                                                                                                                       |   |              | 106,871   |                  |   | 107,101 |   |
|                                                                                                                                                            |   |              | 3,352,850 |                  |   | 3,339,805 |   |
| Less-accumulated depreciation                                                                                                                                   |   |              | (863,730  | )                     |   | (830,153 | ) |
| Net real estate assets                                                                                                                                          |   |              | 2,489,120 |                  |   | 2,509,652 |   |
| For-sale residential condominiums                                                                                                                               |   |              | 5,840     |                  |   | 8,225 |   |
| Real estate and other assets, net, held for sale                                                                                                                |   |              | 11,609    |                  |   | 13,607 |   |
| Cash and cash equivalents                                                                                                                                       |   |              | 9,239     |                  |   | 14,206 |   |
| Restricted cash                                                                                                                                                 |   |              | 7,619     |                  |   | 4,399 |   |
| Accounts receivable, net of allowance of $3,470 and $3,595, respectively                                                                                        |   |              | 22,952    |                  |   | 20,716 |   |
| Mortgages and notes receivable, net of allowance of $617 and $868, respectively                                                                                 |   |              | 18,809    |                  |   | 19,044 |   |
| Accrued straight-line rents receivable, net of allowance of $1,360 and $2,209, respectively                                                                     |   |              | 99,466    |                  |   | 93,178 |   |
| Investment in and advances to unconsolidated affiliates                                                                                                         |   |              | 103,025   |                  |   | 63,607 |   |
| Deferred financing and leasing costs, net of accumulated amortization of $62,542 and $59,360, respectively                                                      |   |              | 85,168    |                  |   | 85,001 |   |
| Prepaid expenses and other assets                                                                                                                               |   |              | 36,633    |                  |   | 40,200 |   |
| Total Assets                                                                                                                                                    |   | $                 | 2,889,480 |                  | $      | 2,871,835 |   |
|                                                                                                                                                            |   |              |      |                  |   |   |   |
| Liabilities, Noncontrolling Interests in the Operating Partnership and Equity:                                                                                  |   |              |      |                  |   |   |   |
| Mortgages and notes payable                                                                                                                                     |   | $                 | 1,615,068 |                  | $      | 1,522,945 |   |
| Accounts payable, accrued expenses and other liabilities                                                                                                        |   |              | 106,105   |                  |   | 106,716 |   |
| Financing obligations                                                                                                                                           |   |              | 32,869    |                  |   | 33,114 |   |
| Total Liabilities                                                                                                                                               |   |              | 1,754,042 |                  |   | 1,662,775 |   |
| Commitments and contingencies                                                                                                                                   |   |              |      |                  |   |   |   |
| Noncontrolling interests in the Operating Partnership                                                                                                           |   |              | 125,075   |                  |   | 120,838 |   |
| Equity:                                                                                                                                                         |   |              |      |                  |   |   |   |
| Preferred Stock, $.01 par value, 50,000,000 authorized shares;                                                                                                  |   |              |      |                  |   |   |   |
| 8.625% Series A Cumulative Redeemable Preferred Shares (liquidation preference $1,000 per share), 29,087 and 29,092 shares issued and outstanding, respectively |   |              | 29,087    |                  |   | 29,092 |   |
| 8.000% Series B Cumulative Redeemable Preferred Shares (liquidation preference $25 per share), 0 and 2,100,000 shares issued and outstanding, respectively      |   |              | —   |                  |   | 52,500 |   |
| Common Stock, $.01 par value, 200,000,000 authorized shares;                                                                                                    |   |              |      |                  |   |   |   |
| 72,399,428 and 71,690,487 shares issued and outstanding, respectively                                                                                           |   |              | 724       |                  |   | 717 |   |
| Additional paid-in capital                                                                                                                                      |   |              | 1,782,889 |                  |   | 1,766,886 |   |
| Distributions in excess of net income available for common stockholders                                                                                         |   |              | (802,606  | )                     |   | (761,785 | ) |
| Accumulated other comprehensive loss                                                                                                                            |   |              | (4,177    | )                     |   | (3,648 | ) |
| Total Stockholders’ Equity                                                                                                                                |   |              | 1,005,917 |                  |   | 1,083,762 |   |
| Noncontrolling interests in consolidated affiliates                                                                                                             |   |              | 4,446     |                  |   | 4,460 |   |
| Total Equity                                                                                                                                                    |   |              | 1,010,363 |                  |   | 1,088,222 |   |
| Total Liabilities, Noncontrolling Interests in the Operating Partnership and Equity                                                                             |   | $                 | 2,889,480 |                  | $      | 2,871,835 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Rental and other revenues                                                                                        |   | $                               | 117,057 |                          | $      | 113,765 |   | $ | 232,036 |   | $ | 228,268 |   |
| Operating expenses:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Rental property and other expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | 41,143  |                          |   | 38,143 |   |   | 82,341 |   |   | 79,647 |   |
| Depreciation and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 33,430  |                          |   | 33,260 |   |   | 67,147 |   |   | 65,898 |   |
| General and administrative                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                            | 7,978   |                          |   | 6,980 |   |   | 15,771 |   |   | 15,487 |   |
| Total operating expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 82,551  |                          |   | 78,383 |   |   | 165,259 |   |   | 161,032 |   |
| Interest expense:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Contractual                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            | 22,940  |                          |   | 21,705 |   |   | 45,371 |   |   | 43,507 |   |
| Amortization of deferred financing costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 821     |                          |   | 835 |   |   | 1,642 |   |   | 1,670 |   |
| Financing obligations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                            | 146     |                          |   | 394 |   |   | 437 |   |   | 870 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 23,907  |                          |   | 22,934 |   |   | 47,450 |   |   | 46,047 |   |
| Other income:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Interest and other income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                            | 1,899   |                          |   | 965 |   |   | 3,772 |   |   | 2,665 |   |
| Loss on debt extinguishment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            | (24     | )                             |   | — |   |   | (24 | ) |   | — |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 1,875   |                          |   | 965 |   |   | 3,748 |   |   | 2,665 |   |
| Income from continuing operations before disposition of property, condominiums and investment in unconsolidated affiliates and equity in earnings of unconsolidated affiliates                                                                                                                                                                                                                                                                                                                                              |   |                            | 12,474  |                          |   | 13,413 |   |   | 23,075 |   |   | 23,854 |   |
| Gains on disposition of property                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                            | 200     |                          |   | 17 |   |   | 200 |   |   | 36 |   |
| Gains on disposition of for-sale residential condominiums                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                            | 116     |                          |   | 163 |   |   | 154 |   |   | 353 |   |
| Gains on disposition of investment in unconsolidated affiliates                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | — |                          |   | 25,330 |   |   | — |   |   | 25,330 |   |
| Equity in earnings of unconsolidated affiliates                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 1,353   |                          |   | 888 |   |   | 2,820 |   |   | 1,683 |   |
| Income from continuing operations                                                                                |   |                            | 14,143  |                          |   | 39,811 |   |   | 26,249 |   |   | 51,256 |   |
| Discontinued operations:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            | 291     |                          |   | 498 |   |   | 628 |   |   | 961 |   |
| Net losses on disposition of discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | — |                          |   | (260 | ) |   | — |   |   | (86 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 291     |                          |   | 238 |   |   | 628 |   |   | 875 |   |
| Net income                                                                                                       |   |                            | 14,434  |                          |   | 40,049 |   |   | 26,877 |   |   | 52,131 |   |
| Net (income) attributable to noncontrolling interests in the Operating Partnership                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | (623    | )                             |   | (1,933 | ) |   | (1,130 | ) |   | (2,453 | ) |
| Net (income) attributable to noncontrolling interests in consolidated affiliates                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                            | (182    | )                             |   | (215 | ) |   | (305 | ) |   | (429 | ) |
| Dividends on Preferred Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                            | (1,622  | )                             |   | (1,677 | ) |   | (3,299 | ) |   | (3,354 | ) |
| Excess of Preferred Stock redemption/repurchase cost over carrying value                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | (1,895  | )                             |   | — |   |   | (1,895 | ) |   | — |   |
| Net income available for common stockholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | $                               | 10,112  |                          | $      | 36,224 |   | $ | 20,248 |   | $ | 45,895 |   |
| Earnings per Common Share - basic:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations available for common stockholders                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | $                               | 0.14    |                          | $      | 0.51 |   | $ | 0.27 |   | $ | 0.63 |   |
| Income from discontinued operations available for common stockholders                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                            | — |                          |   | — |   |   | 0.01 |   |   | 0.01 |   |
| Net income available for common stockholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | $                               | 0.14    |                          | $      | 0.51 |   | $ | 0.28 |   | $ | 0.64 |   |
| Weighted average Common Shares outstanding - basic                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | 72,211  |                          |   | 71,601 |   |   | 72,015 |   |   | 71,508 |   |
| Earnings per Common Share - diluted:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations available for common stockholders                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | $                               | 0.14    |                          | $      | 0.50 |   | $ | 0.27 |   | $ | 0.63 |   |
| Income from discontinued operations available for common stockholders                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                            | — |                          |   | — |   |   | 0.01 |   |   | 0.01 |   |
| Net income available for common stockholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | $                               | 0.14    |                          | $      | 0.50 |   | $ | 0.28 |   | $ | 0.64 |   |
| Weighted average Common Shares outstanding - diluted                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 76,197  |                          |   | 75,607 |   |   | 75,987 |   |   | 75,504 |   |
| Dividends declared per Common Share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | $                               | 0.425   |                          | $      | 0.425 |   | $ | 0.850 |   | $ | 0.850 |   |
| Net income available for common stockholders:                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations available for common stockholders                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | $                               | 9,836   |                          | $      | 35,998 |   | $ | 19,652 |   | $ | 45,064 |   |
| Income from discontinued operations available for common stockholders                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                            | 276     |                          |   | 226 |   |   | 596 |   |   | 831 |   |
| Net income available for common stockholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | $                               | 10,112  |                          | $      | 36,224 |   | $ | 20,248 |   | $ | 45,895 |   |

----

|                                                                               |   | Number of Common Shares |   | Common Stock |    | Series A Cumulative Redeemable Preferred Shares |   | Series B Cumulative Redeemable Preferred Shares |   | Additional Paid-In Capital |    | Accumulated Other ComprehensiveLoss |   | Non-Controlling Interests inConsolidated Affiliates |   | Distributions in Excess of Net Income Available for Common Stockholders |    | Total  |   |
|------------------------------------------------------------------------------------|--------|------------------------------|--------|--------------|---------|-------------------------------------------------|--------|-------------------------------------------------|--------|----------------------------|---------|-------------------------------------|--------|-----------------------------------------------------|--------|-------------------------------------------------------------------------|---------|--------|--------|
| Balance at December 31, 2010                                             |   | 71,690,487                   |   | $            | 717     |                                            | $      | 29,092                                          |   | $                          | 52,500  |                                | $      | 1,766,886                                           |   | $                                                                       | (3,648  | )      | $      | 4,460 |   | $ | (761,785 | ) | $ | 1,088,222 |   |
| Issuances of Common Stock, net                                                     |   | 556,652                      |   |         | 6       |                                            |   | —                                         |   |                       | — |                                |   | 16,978                                              |   |                                                                    | — |   |   | — |   |   | — |   |   | 16,984 |   |
| Conversion of Common Units to Common Stock                                         |   | 18,737                       |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | 635                                                 |   |                                                                    | — |   |   | — |   |   | — |   |   | 635 |   |
| Dividends on Common Stock                                                          |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | — |   |   | (61,069 | ) |   | (61,069 | ) |
| Dividends on Preferred Stock                                                       |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | — |   |   | (3,299 | ) |   | (3,299 | ) |
| Adjustment of noncontrolling interestsin the Operating Partnership to fair value   |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | (6,957                                              | )      |                                                                    | — |   |   | — |   |   | — |   |   | (6,957 | ) |
| Distributions to noncontrolling interests in consolidated affiliates               |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | (319 | ) |   | — |   |   | (319 | ) |
| Issuances of restricted stock, net                                                 |   | 133,552                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | — |   |   | — |   |   | — |   |
| Redemptions/repurchases of Preferred Stock                                         |   | —                      |   |         | — |                                            |   | (5                                              | )      |                       | (52,500 | )                                   |   | 1,895                                               |   |                                                                    | — |   |   | — |   |   | (1,895 | ) |   | (52,505 | ) |
| Share-based compensation expense                                                   |   | —                      |   |         | 1       |                                            |   | —                                         |   |                       | — |                                |   | 3,452                                               |   |                                                                    | — |   |   | — |   |   | — |   |   | 3,453 |   |
| Net (income) attributable to noncontrolling interests in the Operating Partnership |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | — |   |   | (1,130 | ) |   | (1,130 | ) |
| Net (income) attributable to noncontrolling interests in consolidated affiliates   |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | 305 |   |   | (305 | ) |   | — |   |
| Comprehensive income:                                                              |   |                         |   |         |    |                                            |   |                                            |   |                       |    |                                |   |                                                |   |                                                                    |    |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                         |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | — |   |   | 26,877 |   |   | 26,877 |   |
| Other comprehensive loss                                                           |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | (529    | )      |   | — |   |   | — |   |   | (529 | ) |
| Total comprehensive income                                                         |   |                         |   |         |    |                                            |   |                                            |   |                       |    |                                |   |                                                |   |                                                                    |    |   |   |   |   |   |   |   |   | 26,348 |   |
| Balance at June 30, 2011                                                 |   | 72,399,428                   |   | $            | 724     |                                            | $      | 29,087                                          |   | $                          | — |                                | $      | 1,782,889                                           |   | $                                                                       | (4,177  | )      | $      | 4,446 |   | $ | (802,606 | ) | $ | 1,010,363 |   |

|                                                                               |   | Number of Common Shares |   | Common Stock |    | Series A Cumulative Redeemable Preferred Shares |   | Series B Cumulative Redeemable Preferred Shares |   | Additional Paid-In Capital |    | Accumulated Other ComprehensiveLoss |   | Non-Controlling Interests inConsolidated Affiliates |   | Distributions in Excess of Net Income Available for Common Stockholders |    | Total  |   |
|------------------------------------------------------------------------------------|--------|------------------------------|--------|--------------|---------|-------------------------------------------------|--------|-------------------------------------------------|--------|----------------------------|---------|-------------------------------------|--------|-----------------------------------------------------|--------|-------------------------------------------------------------------------|---------|--------|--------|
| Balance at December 31, 2009                                             |   | 71,285,303                   |   | $            | 713     |                                            | $      | 29,092                                          |   | $                          | 52,500  |                                | $      | 1,751,398                                           |   | $                                                                       | (3,811  | )      | $      | 5,183 |   | $ | (701,932 | ) | $ | 1,133,143 |   |
| Issuances of Common Stock, net                                                     |   | 71,568                       |   |         | 1       |                                            |   | —                                         |   |                       | — |                                |   | 1,061                                               |   |                                                                    | — |   |   | — |   |   | — |   |   | 1,062 |   |
| Conversion of Common Units to Common Stock                                         |   | 93,971                       |   |         | 1       |                                            |   | —                                         |   |                       | — |                                |   | 2,957                                               |   |                                                                    | — |   |   | — |   |   | — |   |   | 2,958 |   |
| Dividends on Common Stock                                                          |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | — |   |   | (60,753 | ) |   | (60,753 | ) |
| Dividends on Preferred Stock                                                       |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | — |   |   | (3,354 | ) |   | (3,354 | ) |
| Adjustment of noncontrolling interestsin the Operating Partnership to fair value   |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | 20,612                                              |   |                                                                    | — |   |   | — |   |   | — |   |   | 20,612 |   |
| Distributions to noncontrolling interests in consolidated affiliates               |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | (324 | ) |   | — |   |   | (324 | ) |
| Issuances of restricted stock, net                                                 |   | 164,143                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | — |   |   | — |   |   | — |   |
| Share-based compensation expense                                                   |   | —                      |   |         | 1       |                                            |   | —                                         |   |                       | — |                                |   | 3,496                                               |   |                                                                    | — |   |   | — |   |   | — |   |   | 3,497 |   |
| Net (income) attributable to noncontrolling interests in the Operating Partnership |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | — |   |   | (2,453 | ) |   | (2,453 | ) |
| Net (income) attributable to noncontrolling interests in consolidated affiliates   |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | 429 |   |   | (429 | ) |   | — |   |
| Comprehensive income:                                                              |   |                         |   |         |    |                                            |   |                                            |   |                       |    |                                |   |                                                |   |                                                                    |    |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                         |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | — |   |   | — |   |   | 52,131 |   |   | 52,131 |   |
| Other comprehensive income                                                         |   | —                      |   |         | — |                                            |   | —                                         |   |                       | — |                                |   | —                                             |   |                                                                    | 536     |   |   | — |   |   | — |   |   | 536 |   |
| Total comprehensive income                                                         |   |                         |   |         |    |                                            |   |                                            |   |                       |    |                                |   |                                                |   |                                                                    |    |   |   |   |   |   |   |   |   | 52,667 |   |
| Balance at June 30, 2010                                                 |   | 71,614,985                   |   | $            | 716     |                                            | $      | 29,092                                          |   | $                          | 52,500  |                                | $      | 1,779,524                                           |   | $                                                                       | (3,275  | )      | $      | 5,288 |   | $ | (716,790 | ) | $ | 1,147,055 |   |

----

|                                                                                       |   | Six Months EndedJune 30, |     |
|--------------------------------------------------------------------------------------------|--------|-------------------------------|----------|
|                                                                                       |   | 2011                          |     | 2010 |   |
| Operating activities:                                                                      |   |                          |     |   |   |   |   |
| Net income                                                                                 |   | $                             | 26,877   |   | $ | 52,131 |   |
| Adjustments to reconcile net income to net cash provided by operating activities:          |   |                          |     |   |   |   |   |
| Depreciation and amortization                                                              |   |                          | 67,274   |   |   | 66,447 |   |
| Amortization of lease incentives and acquisition-related intangible assets and liabilities |   |                          | 968      |   |   | 537 |   |
| Share-based compensation expense                                                           |   |                          | 3,453    |   |   | 3,497 |   |
| Allowance for losses on accounts and accrued straight-line rents receivable                |   |                          | 1,029    |   |   | 2,636 |   |
| Amortization of deferred financing costs                                                   |   |                          | 1,642    |   |   | 1,670 |   |
| Amortization of settled cash-flow hedges                                                   |   |                          | (58      | ) |   | 287 |   |
| Loss on debt extinguishment                                                                |   |                          | 24       |   |   | — |   |
| Net (gains)/losses on disposition of property                                              |   |                          | (200     | ) |   | 50 |   |
| Gains on disposition of for-sale residential condominiums                                  |   |                          | (154     | ) |   | (353 | ) |
| Gains on disposition of investment in unconsolidated affiliates                            |   |                          | —  |   |   | (25,330 | ) |
| Equity in earnings of unconsolidated affiliates                                            |   |                          | (2,820   | ) |   | (1,683 | ) |
| Changes in financing obligations                                                           |   |                          | (245     | ) |   | 81 |   |
| Distributions of earnings from unconsolidated affiliates                                   |   |                          | 2,162    |   |   | 1,717 |   |
| Changes in operating assets and liabilities:                                               |   |                          |     |   |   |   |   |
| Accounts receivable                                                                        |   |                          | (1,821   | ) |   | (1,430 | ) |
| Prepaid expenses and other assets                                                          |   |                          | (644     | ) |   | 1,734 |   |
| Accrued straight-line rents receivable                                                     |   |                          | (6,098   | ) |   | (5,296 | ) |
| Accounts payable, accrued expenses and other liabilities                                   |   |                          | (3,794   | ) |   | 3,352 |   |
| Net cash provided by operating activities                                                  |   |                          | 87,595   |   |   | 100,047 |   |
| Investing activities:                                                                      |   |                          |     |   |   |   |   |
| Additions to real estate assets and deferred leasing costs                                 |   |                          | (44,447  | ) |   | (38,292 | ) |
| Net proceeds from disposition of real estate assets                                        |   |                          | 2,063    |   |   | 6,801 |   |
| Net proceeds from disposition of for-sale residential condominiums                         |   |                          | 2,401    |   |   | 3,186 |   |
| Proceeds from disposition of investment in unconsolidated affiliates                       |   |                          | —  |   |   | 15,000 |   |
| Distributions of capital from unconsolidated affiliates                                    |   |                          | 632      |   |   | 1,106 |   |
| Repayments of mortgages and notes receivable                                               |   |                          | 235      |   |   | 29 |   |
| Investment in and advances to unconsolidated affiliates                                    |   |                          | (39,402  | ) |   | (303 | ) |
| Changes in restricted cash and other investing activities                                  |   |                          | (395     | ) |   | (3,178 | ) |
| Net cash used in investing activities                                                      |   |                          | (78,913  | ) |   | (15,651 | ) |
| Financing activities:                                                                      |   |                          |     |   |   |   |   |
| Dividends on Common Stock                                                                  |   |                          | (61,069  | ) |   | (60,753 | ) |
| Redemptions/repurchases of Preferred Stock                                                 |   |                          | (52,505  | ) |   | — |   |
| Dividends on Preferred Stock                                                               |   |                          | (3,299   | ) |   | (3,354 | ) |
| Distributions to noncontrolling interests in the Operating Partnership                     |   |                          | (3,215   | ) |   | (3,243 | ) |
| Distributions to noncontrolling interests in consolidated affiliates                       |   |                          | (319     | ) |   | (324 | ) |
| Net proceeds from the issuance of Common Stock                                             |   |                          | 16,984   |   |   | 1,062 |   |
| Borrowings on revolving credit facility                                                    |   |                          | 124,700  |   |   | 4,000 |   |
| Repayments of revolving credit facility                                                    |   |                          | (79,300  | ) |   | (4,000 | ) |
| Borrowings on mortgages and notes payable                                                  |   |                          | 200,000  |   |   | — |   |
| Repayments of mortgages and notes payable                                                  |   |                          | (153,522 | ) |   | (5,452 | ) |
| Additions to deferred financing costs and other financing activities                       |   |                          | (2,104   | ) |   | (188 | ) |
| Net cash used in financing activities                                                      |   |                          | (13,649  | ) |   | (72,252 | ) |
| Net increase/(decrease) in cash and cash equivalents                                       |   |                          | (4,967   | ) |   | 12,144 |   |
| Cash and cash equivalents at beginning of the period                                       |   |                          | 14,206   |   |   | 23,699 |   |
| Cash and cash equivalents at end of the period                                             |   | $                             | 9,239    |   | $ | 35,843 |   |

----

|                                               |   | Six Months EndedJune 30, |   |
|----------------------------------------------------|--------|-------------------------------|--------|
|                                               |   | 2011                          |   | 2010 |   |
| Cash paid for interest, net of amounts capitalized |   | $                             | 44,948 |   | $ | 43,204 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | Six Months EndedJune 30, |    |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|---------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | 2011                          |    | 2010 |   |
| Conversion of Common Units to Common Stock                                                                                                                                 |   | $                             | 635     |   | $ | 2,958 |   |
| Change in accrued capital expenditures                                                                                                                                     |   | $                             | 1,525   |   | $ | (2,294 | ) |
| Write-off of fully depreciated real estate assets                                                                                                                          |   | $                             | 23,352  |   | $ | 24,273 |   |
| Write-off of fully amortized deferred financing and leasing costs                                                                                                          |   | $                             | 8,247   |   | $ | 7,963 |   |
| Unrealized gains on marketable securities of non-qualified deferred compensation plan                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | $                             | 210     |   | $ | 174 |   |
| Settlement of financing obligation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | $                             | — |   | $ | 4,184 |   |
| Adjustment of noncontrolling interests in the Operating Partnership to fair value                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | $                             | 6,957   |   | $ | (20,612 | ) |
| Unrealized gain/(loss) on tax increment financing bond                                                                                                                     |   | $                             | (471    | ) | $ | 146 |   |
| Mortgages receivable from seller financing                                                                                                                                 |   | $                             | — |   | $ | 17,030 |   |

----

----

|                                |   | June 30,2011 |    | December 31,2010 |   |
|-------------------------------------|--------|-------------------|---------|------------------|--------|
| Seller financing (first mortgages)  |   | $                 | 17,180  |             | $      | 17,180 |   |
| Less allowance                      |   |              | — |             |   | — |   |
|                                |   |              | 17,180  |             |   | 17,180 |   |
| Promissory notes                    |   |              | 2,246   |             |   | 2,732 |   |
| Less allowance                      |   |              | (617    | )                |   | (868 | ) |
|                                |   |              | 1,629   |             |   | 1,864 |   |
| Mortgages and notes receivable, net |   | $                 | 18,809  |             | $      | 19,044 |   |

----

|                                 |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|--------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                 |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Beginning notes receivable allowance |   | $                               | 497     |                          | $      | 732 |   | $ | 868 |   | $ | 698 |   |
| Bad debt expense                     |   |                            | 162     |                          |   | 25 |   |   | 184 |   |   | 88 |   |
| Write-offs                           |   |                            | — |                          |   | (5 | ) |   | (364 | ) |   | (5 | ) |
| Recoveries/other                     |   |                            | (42     | )                             |   | 19 |   |   | (71 | ) |   | (10 | ) |
| Total notes receivable allowance     |   | $                               | 617     |                          | $      | 771 |   | $ | 617 |   | $ | 771 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | Three Months EndedJune 30, |   | Six Months EndedJune 30, |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|--------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | 2011                            |   | 2010                          |   | 2011 |   | 2010 |   |
| Income Statements:                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                            |   |                          |   |   |   |   |   |   |   |   |   |
| Revenues                                                                       |   | $                               | 24,779 |                          | $      | 31,714 |   | $ | 49,996 |   | $ | 67,302 |   |
| Expenses:                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            |   |                          |   |   |   |   |   |   |   |   |   |
| Rental property and other expenses                                                                                                                                                                                                                                                                                                                                                                                                           |   |                            | 10,774 |                          |   | 15,632 |   |   | 22,771 |   |   | 32,799 |   |
| Depreciation and amortization                                                                                                                                                                                                                                                                                                                                                                                                                |   |                            | 6,295  |                          |   | 7,778 |   |   | 12,911 |   |   | 17,378 |   |
| Interest expense                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 5,858  |                          |   | 7,233 |   |   | 11,865 |   |   | 15,798 |   |
| Total expenses                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 22,927 |                          |   | 30,643 |   |   | 47,547 |   |   | 65,975 |   |
| Net income                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | $                               | 1,852  |                          | $      | 1,071 |   | $ | 2,449 |   | $ | 1,327 |   |
| Our share of:                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                            |   |                          |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization of real estate assets                                                                                                                                                                                                                                                                                                                                                                                          |   | $                               | 2,033  |                          | $      | 2,737 |   | $ | 4,126 |   | $ | 6,078 |   |
| Interest expense                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $                               | 2,033  |                          | $      | 2,755 |   | $ | 4,194 |   | $ | 6,178 |   |
| Net income                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | $                               | 749    |                          | $      | 308 |   | $ | 1,670 |   | $ | 520 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            |   |                          |   |   |   |   |   |   |   |   |   |
| Our share of net income                                                                                                                                                                                                                                                                                                                                                                                                                      |   | $                               | 749    |                          | $      | 308 |   | $ | 1,670 |   | $ | 520 |   |
| Purchase accounting and management, leasing and other fees adjustments                                                                                                                                                                                                                                                                                                                                                                       |   |                            | 604    |                          |   | 580 |   |   | 1,150 |   |   | 1,163 |   |
| Equity in earnings of unconsolidated affiliates                                                                                                                                                                                                                                                                                                                                                                                              |   | $                               | 1,353  |                          | $      | 888 |   | $ | 2,820 |   | $ | 1,683 |   |

----

|                                                                                          |   | June 30,2011 |    | December 31,2010 |   |
|-----------------------------------------------------------------------------------------------|--------|-------------------|---------|------------------|--------|
| Assets:                                                                                       |   |              |    |             |   |   |   |
| Deferred financing costs                                                                      |   | $                 | 17,295  |             | $      | 16,412 |   |
| Less accumulated amortization                                                                 |   |              | (7,996  | )                |   | (7,054 | ) |
|                                                                                          |   |              | 9,299   |             |   | 9,358 |   |
| Deferred leasing costs (including lease incentives and acquisition-related intangible assets) |   |              | 130,415 |             |   | 127,949 |   |
| Less accumulated amortization                                                                 |   |              | (54,546 | )                |   | (52,306 | ) |
|                                                                                          |   |              | 75,869  |             |   | 75,643 |   |
| Deferred financing and leasing costs, net                                                     |   | $                 | 85,168  |             | $      | 85,001 |   |
|                                                                                          |   |              |    |             |   |   |   |
| Liabilities (in accounts payable, accrued expenses and other liabilities):                    |   |              |    |             |   |   |   |
| Acquisition-related intangible liabilities                                                    |   | $                 | 720     |             | $      | 658 |   |
| Less accumulated amortization                                                                 |   |              | (226    | )                |   | (125 | ) |
|                                                                                          |   | $                 | 494     |             | $      | 533 |   |

|                                                                                                                |   | Three Months EndedJune 30, |   | Six Months EndedJune 30, |   |
|---------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|--------|-------------------------------|--------|
|                                                                                                                |   | 2011                            |   | 2010                          |   | 2011 |   | 2010 |   |
| Amortization of deferred financing costs                                                                            |   | $                               | 821    |                          | $      | 835 |   | $ | 1,642 |   | $ | 1,670 |   |
| Amortization of deferred leasing costs and acquisition-related intangible assets (in depreciation and amortization) |   | $                               | 4,401  |                          | $      | 3,817 |   | $ | 8,757 |   | $ | 7,583 |   |
| Amortization of lease incentives (in rental and other revenues)                                                     |   | $                               | 303    |                          | $      | 276 |   | $ | 641 |   | $ | 537 |   |
| Amortization of acquisition-related intangible assets and liabilities (in rental and other revenues)                |   | $                               | 166    |                          | $      | 36 |   | $ | 327 |   | $ | 76 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                     |   | Amortization of Deferred Financing Costs |   | Amortization of Deferred Leasing Costs and Acquisition-Related Intangible Assets (in Depreciation and Amortization) |   | Amortization of Lease Incentives (in Rental and Other Revenues) |   | Amortization of Acquisition-Related Intangible Assets and Liabilities (in Rental and Other Revenues) |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------|--------|
| July 1, 2011 through December 31, 2011                                                                                                                                                                                                                                                                                                                               |   | $                                        | 1,724  |                                                                                                                | $      | 8,653                                                           |   | $                                                                                                    | 613    |   | $ | 320 |   |
| 2012                                                                    |   |                                     | 3,093  |                                                                                                                |   | 15,087                                                          |   |                                                                                                 | 1,141  |   |   | 561 |   |
| 2013                                                                    |   |                                     | 1,486  |                                                                                                                |   | 12,106                                                          |   |                                                                                                 | 983    |   |   | 390 |   |
| 2014                                                                    |   |                                     | 1,098  |                                                                                                                |   | 9,398                                                           |   |                                                                                                 | 819    |   |   | 298 |   |
| 2015                                                                    |   |                                     | 1,098  |                                                                                                                |   | 6,966                                                           |   |                                                                                                 | 603    |   |   | 188 |   |
| Thereafter                                                              |   |                                     | 800    |                                                                                                                |   | 14,690                                                          |   |                                                                                                 | 2,088  |   |   | 471 |   |
|                                                                                                                                                                                                                                                                                                                                                                                     |   | $                                        | 9,299  |                                                                                                                | $      | 66,900                                                          |   | $                                                                                                    | 6,247  |   | $ | 2,228 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | June 30,2011 |      | December 31,2010 |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|-----------|------------------|--------|
| Secured indebtedness                                                                                                         |   | $                 | 748,563   |             | $      | 754,399 |   |
| Unsecured indebtedness                                                                                                       |   |              | 866,505   |             |   | 768,546 |   |
| Total mortgages and notes payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   | $                 | 1,615,068 |             | $      | 1,522,945 |   |

----

|                                                                               |   | Six Months EndedJune 30, |    |
|------------------------------------------------------------------------------------|--------|-------------------------------|---------|
|                                                                               |   | 2011                          |    | 2010 |   |
| Beginning noncontrolling interests in the Operating Partnership                    |   | $                             | 120,838 |   | $ | 129,769 |   |
| Adjustments of noncontrolling interests in the Operating Partnership to fair value |   |                          | 6,957   |   |   | (20,612 | ) |
| Conversion of Common Units to Common Stock                                         |   |                          | (635    | ) |   | (2,958 | ) |
| Net income attributable to noncontrolling interests in the Operating Partnership   |   |                          | 1,130   |   |   | 2,453 |   |
| Distributions to noncontrolling interests in the Operating Partnership             |   |                          | (3,215  | ) |   | (3,243 | ) |
| Total noncontrolling interests in the Operating Partnership                        |   | $                             | 125,075 |   | $ | 105,409 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | Three Months EndedJune 30, |   | Six Months EndedJune 30, |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|--------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | 2011                            |   | 2010                          |   | 2011 |   | 2010 |   |
| Net income available for common stockholders                                                                                |   | $                               | 10,112 |                          | $      | 36,224 |   | $ | 20,248 |   | $ | 45,895 |   |
| Increase in additional paid in capital from conversion of Common Units to Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            | 449    |                          |   | 33 |   |   | 635 |   |   | 2,957 |   |
| Change in equity from net income available for common stockholders and conversion of Common Units to Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                      |   | $                               | 10,561 |                          | $      | 36,257 |   | $ | 20,883 |   | $ | 48,852 |   |

----

|                                                                                                         |   | June 30,2011 |    | Level 1 |   | Level 3 |   |
|--------------------------------------------------------------------------------------------------------------|--------|-------------------|---------|---------|--------|---------|--------|
| Assets:                                                                                                      |   |              |    |    |   |    |   |   |   |   |
| Marketable securities of non-qualified deferred compensation plan (in prepaid expenses and other assets)     |   | $                 | 3,876   |    | $      | 3,876   |   | $ | — |   |
| Tax increment financing bond (in prepaid expenses and other assets)                                          |   |              | 15,228  |    |   | — |   |   | 15,228 |   |
| Total Assets                                                                                                 |   | $                 | 19,104  |    | $      | 3,876   |   | $ | 15,228 |   |
|                                                                                                         |   |              |    |    |   |    |   |   |   |   |
| Noncontrolling Interests in the Operating Partnership                                                        |   | $                 | 125,075 |    | $      | 125,075 |   | $ | — |   |
|                                                                                                         |   |              |    |    |   |    |   |   |   |   |
| Liability:                                                                                                   |   |              |    |    |   |    |   |   |   |   |
| Non-qualified deferred compensation obligation (in accounts payable, accrued expenses and other liabilities) |   | $                 | 3,876   |    | $      | 3,876   |   | $ | — |   |

|                                                                                                         |   | December 31,2010 |    | Level 1 |   | Level 3 |   |
|--------------------------------------------------------------------------------------------------------------|--------|-----------------------|---------|---------|--------|---------|--------|
| Assets:                                                                                                      |   |                  |    |    |   |    |   |   |   |   |
| Marketable securities of non-qualified deferred compensation plan (in prepaid expenses and other assets)     |   | $                     | 3,479   |    | $      | 3,479   |   | $ | — |   |
| Tax increment financing bond (in prepaid expenses and other assets)                                          |   |                  | 15,699  |    |   | — |   |   | 15,699 |   |
| Total Assets                                                                                                 |   | $                     | 19,178  |    | $      | 3,479   |   | $ | 15,699 |   |
|                                                                                                         |   |                  |    |    |   |    |   |   |   |   |
| Noncontrolling Interests in the Operating Partnership                                                        |   | $                     | 120,838 |    | $      | 120,838 |   | $ | — |   |
|                                                                                                         |   |                  |    |    |   |    |   |   |   |   |
| Liability:                                                                                                   |   |                  |    |    |   |    |   |   |   |   |
| Non-qualified deferred compensation obligation (in accounts payable, accrued expenses and other liabilities) |   | $                     | 4,091   |    | $      | 4,091   |   | $ | — |   |

----

|                             |   | Three Months EndedJune 30, |   | Six Months EndedJune 30, |   |
|----------------------------------|--------|---------------------------------|--------|-------------------------------|--------|
|                             |   | 2011                            |   | 2010                          |   | 2011 |   | 2010 |   |
| Asset:                           |   |                            |   |                          |   |   |   |   |   |   |   |   |   |
| Tax Increment Financing Bond     |   |                            |   |                          |   |   |   |   |   |   |   |   |   |
| Beginning balance                |   | $                               | 15,564 |                          | $      | 17,090 |   | $ | 15,699 |   | $ | 16,871 |   |
| Unrealized gain/(loss) (in AOCL) |   |                            | (336   | )                             |   | (73 | ) |   | (471 | ) |   | 146 |   |
| Ending balance                   |   | $                               | 15,228 |                          | $      | 17,017 |   | $ | 15,228 |   | $ | 17,017 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   | CarryingAmount |      | Fair Value |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------|-----------|------------|--------|
| June 30, 2011                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |           |      |       |   |   |   |
| Mortgages and notes receivable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | $              | 18,809    |       | $      | 19,141 |   |
| Mortgages and notes payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $              | 1,615,068 |       | $      | 1,725,186 |   |
| Financing obligations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   | $              | 32,869    |       | $      | 20,852 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |           |      |       |   |   |   |
| December 31, 2010                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |           |      |       |   |   |   |
| Mortgages and notes receivable                                                                                                 |   | $              | 19,044    |       | $      | 19,093 |   |
| Mortgages and notes payable                                                                                                    |   | $              | 1,522,945 |       | $      | 1,581,518 |   |
| Financing obligations                                                                                                          |   | $              | 33,114    |       | $      | 23,880 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Net income                                                                              |   | $                               | 14,434  |                          | $      | 40,049 |   | $ | 26,877 |   | $ | 52,131 |   |
| Other comprehensive income/(loss):                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Unrealized gain/(loss) on tax increment financing bond                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                            | (336    | )                             |   | (73 | ) |   | (471 | ) |   | 146 |   |
| Amortization of settled cash-flow hedges                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            | (29     | )                             |   | 48 |   |   | (58 | ) |   | 287 |   |
| Sale of cash-flow hedge related to disposition of investmentin unconsolidated affiliate                                                                                                                                                                                                                                                                                                                                                                                                  |   |                            | — |                          |   | 103 |   |   | — |   |   | 103 |   |
| Total other comprehensive income/(loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                            | (365    | )                             |   | 78 |   |   | (529 | ) |   | 536 |   |
| Total comprehensive income                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | $                               | 14,069  |                          | $      | 40,127 |   | $ | 26,348 |   | $ | 52,667 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | June 30,2011 |   | December 31,2010 |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|--------|------------------|--------|
| Tax increment financing bond                                                                                                       |   | $                 | 3,013  |             | $      | 2,543 |   |
| Settled cash-flow hedges                                                                                                           |   |              | 1,164  |             |   | 1,105 |   |
| Total accumulated other comprehensive loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | $                 | 4,177  |             | $      | 3,648 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Rental and other revenues                                                                                          |   | $                               | 500     |                          | $      | 1,227 |   | $ | 1,113 |   | $ | 2,557 |   |
| Operating expenses:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Rental property and other expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | 178     |                          |   | 455 |   |   | 359 |   |   | 1,048 |   |
| Depreciation and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 32      |                          |   | 275 |   |   | 127 |   |   | 549 |   |
| Total operating expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 210     |                          |   | 730 |   |   | 486 |   |   | 1,597 |   |
| Other income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                            | 1       |                          |   | 1 |   |   | 1 |   |   | 1 |   |
| Income from discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            | 291     |                          |   | 498 |   |   | 628 |   |   | 961 |   |
| Net losses on disposition of discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | — |                          |   | (260 | ) |   | — |   |   | (86 | ) |
| Total discontinued operations                                                                                      |   | $                               | 291     |                          | $      | 238 |   | $ | 628 |   | $ | 875 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | June 30,2011 |    | December 31,2010 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|---------|------------------|--------|
| Assets:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |              |    |             |   |   |   |
| Land                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | $                 | 2,788   |             | $      | 2,788 |   |
| Buildings and tenant improvements                                                                                                                                                             |   |              | 12,663  |             |   | 12,707 |   |
| Land held for development                                                                                                                                                                     |   |              | 967     |             |   | 2,766 |   |
| Total real estate assets                                                                                                                                                                                               |   |              | 16,418  |             |   | 18,261 |   |
| Less accumulated depreciation                                                                                                                                                                 |   |              | (5,113  | )                |   | (5,012 | ) |
| Net real estate assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |              | 11,305  |             |   | 13,249 |   |
| Deferred leasing costs, net                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |              | 55      |             |   | 58 |   |
| Accrued straight line rents receivable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |              | 249     |             |   | 257 |   |
| Prepaid expenses and other assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |              | — |             |   | 43 |   |
| Real estate and other assets, net, held for sale                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | $                 | 11,609  |             | $      | 13,607 |   |
| Tenant security deposits, deferred rents and accrued costs (1)                                                                                                       |   | $                 | 123     |             | $      | 11 |   |

| (1) | Included in accounts payable, accrued expenses and other liabilities. |
|-----|-----------------------------------------------------------------------|

----

|                                                                                                                                                          |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                          |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Earnings per Common Share - basic:                                                                                                                            |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Numerator:                                                                                                                                                    |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations                                                                                                                             |   | $                               | 14,143  |                          | $      | 39,811 |   | $ | 26,249 |   | $ | 51,256 |   |
| Net (income) attributable to noncontrolling  interests in the Operating Partnership from continuing operations                                      |   |                            | (608    | )                             |   | (1,921 | ) |   | (1,098 | ) |   | (2,409 | ) |
| Net (income) attributable to noncontrolling interests in consolidated affiliates from continuing operations                                                   |   |                            | (182    | )                             |   | (215 | ) |   | (305 | ) |   | (429 | ) |
| Dividends on Preferred Stock                                                                                                                                  |   |                            | (1,622  | )                             |   | (1,677 | ) |   | (3,299 | ) |   | (3,354 | ) |
| Excess of Preferred Stock redemption/repurchase cost over carrying value                                                                                      |   |                            | (1,895  | )                             |   | — |   |   | (1,895 | ) |   | — |   |
| Income from continuing operations available for common stockholders                                                                                           |   |                            | 9,836   |                          |   | 35,998 |   |   | 19,652 |   |   | 45,064 |   |
| Income from discontinued operations                                                                                                                           |   |                            | 291     |                          |   | 238 |   |   | 628 |   |   | 875 |   |
| Net (income) attributable to noncontrolling interests in the Operating Partnership from discontinued operations                                               |   |                            | (15     | )                             |   | (12 | ) |   | (32 | ) |   | (44 | ) |
| Income from discontinued operations available for common stockholders                                                                                         |   |                            | 276     |                          |   | 226 |   |   | 596 |   |   | 831 |   |
| Net income available for common stockholders                                                                                                                  |   | $                               | 10,112  |                          | $      | 36,224 |   | $ | 20,248 |   | $ | 45,895 |   |
| Denominator:                                                                                                                                                  |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Denominator for basic earnings per Common Share – weighted averageshares                                                                                |   |                            | 72,211  |                          |   | 71,601 |   |   | 72,015 |   |   | 71,508 |   |
| Earnings per Common Share – basic:                                                                                                                      |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations available for common stockholders                                                                                           |   | $                               | 0.14    |                          | $      | 0.51 |   | $ | 0.27 |   | $ | 0.63 |   |
| Income from discontinued operations available for common stockholders                                                                                         |   |                            | — |                          |   | — |   |   | 0.01 |   |   | 0.01 |   |
| Net income available for common stockholders                                                                                                                  |   | $                               | 0.14    |                          | $      | 0.51 |   | $ | 0.28 |   | $ | 0.64 |   |
| Earnings per Common Share - diluted:                                                                                                                          |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Numerator:                                                                                                                                                    |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations                                                                                                                             |   | $                               | 14,143  |                          | $      | 39,811 |   | $ | 26,249 |   | $ | 51,256 |   |
| Net (income) attributable to noncontrolling interests in consolidated affiliates from continuing operations                                                   |   |                            | (182    | )                             |   | (215 | ) |   | (305 | ) |   | (429 | ) |
| Dividends on Preferred Stock                                                                                                                                  |   |                            | (1,622  | )                             |   | (1,677 | ) |   | (3,299 | ) |   | (3,354 | ) |
| Excess of Preferred Stock redemption/repurchase cost over carrying value                                                                                      |   |                            | (1,895  | )                             |   | — |   |   | (1,895 | ) |   | — |   |
| Income from continuing operations available for common stockholders before net (income) attributable to noncontrolling interests in the Operating Partnership |   |                            | 10,444  |                          |   | 37,919 |   |   | 20,750 |   |   | 47,473 |   |
| Income from discontinued operations available for common stockholders                                                                                         |   |                            | 291     |                          |   | 238 |   |   | 628 |   |   | 875 |   |
| Net income available for common stockholders before net (income) attributable to noncontrolling interests in the Operating Partnership                        |   | $                               | 10,735  |                          | $      | 38,157 |   | $ | 21,378 |   | $ | 48,348 |   |
| Denominator:                                                                                                                                                  |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Denominator for basic earnings per Common Share –weighted averageshares                                                                                 |   |                            | 72,211  |                          |   | 71,601 |   |   | 72,015 |   |   | 71,508 |   |
| Add:                                                                                                                                                          |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Stock options using the treasury method                                                                                                                       |   |                            | 202     |                          |   | 209 |   |   | 185 |   |   | 188 |   |
| Noncontrolling interests partnership units                                                                                                                    |   |                            | 3,784   |                          |   | 3,797 |   |   | 3,787 |   |   | 3,808 |   |
| Denominator for diluted earnings per Common Share – adjusted weighted average shares and assumed conversions (1)                                        |   |                            | 76,197  |                          |   | 75,607 |   |   | 75,987 |   |   | 75,504 |   |
| Earnings per Common Share – diluted:                                                                                                                    |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations available for common stockholders                                                                                           |   | $                               | 0.14    |                          |   | 0.50 |   |   | 0.27 |   |   | 0.63 |   |
| Income from discontinued operations available for common stockholders                                                                                         |   |                            | — |                          |   | — |   |   | 0.01 |   |   | 0.01 |   |
| Net income available for common stockholders                                                                                                                  |   | $                               | 0.14    |                          |   | 0.50 |   |   | 0.28 |   |   | 0.64 |   |

----

| (1) | There were 0.3 million and 0.6 million options outstanding during the three and six months ended June 30, 2011 and 2010, respectively, that were not included in the computation of diluted earnings per share because the impact of including such options would be anti-dilutive. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Rental and Other Revenues: (1)                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Office:                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Atlanta, GA                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $                               | 12,341  |                          | $      | 12,065 |   | $ | 24,245 |   | $ | 24,198 |   |
| Greenville, SC                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | 3,437   |                          |   | 3,451 |   |   | 6,943 |   |   | 7,127 |   |
| Kansas City, MO                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            | 3,586   |                          |   | 3,663 |   |   | 7,243 |   |   | 7,371 |   |
| Memphis, TN                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 10,077  |                          |   | 7,328 |   |   | 20,180 |   |   | 15,196 |   |
| Nashville, TN                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                            | 15,362  |                          |   | 14,851 |   |   | 29,977 |   |   | 29,964 |   |
| Orlando, FL                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 2,619   |                          |   | 3,059 |   |   | 4,937 |   |   | 6,064 |   |
| Piedmont Triad, NC                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                            | 5,273   |                          |   | 5,367 |   |   | 10,637 |   |   | 10,764 |   |
| Raleigh, NC                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 20,103  |                          |   | 18,523 |   |   | 39,423 |   |   | 37,328 |   |
| Richmond, VA                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                            | 11,668  |                          |   | 11,483 |   |   | 23,047 |   |   | 23,276 |   |
| Tampa, FL                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 17,458  |                          |   | 18,037 |   |   | 34,250 |   |   | 35,979 |   |
| Total Office Segment                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 101,924 |                          |   | 97,827 |   |   | 200,882 |   |   | 197,267 |   |
| Industrial:                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Atlanta, GA                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 4,028   |                          |   | 3,842 |   |   | 7,962 |   |   | 7,817 |   |
| Piedmont Triad, NC                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                            | 2,825   |                          |   | 3,044 |   |   | 5,803 |   |   | 6,065 |   |
| Total Industrial Segment                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                            | 6,853   |                          |   | 6,886 |   |   | 13,765 |   |   | 13,882 |   |
| Retail:                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Kansas City, MO                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            | 8,203   |                          |   | 8,749 |   |   | 17,104 |   |   | 16,437 |   |
| Total Retail Segment                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 8,203   |                          |   | 8,749 |   |   | 17,104 |   |   | 16,437 |   |
| Residential:                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Kansas City, MO                                                                                                                                            |   |                            | 77      |                          |   | 303 |   |   | 285 |   |   | 682 |   |
| Total Residential Segment                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 77      |                          |   | 303 |   |   | 285 |   |   | 682 |   |
| Total Rental and Other Revenues                                                                     |   | $                               | 117,057 |                          | $      | 113,765 |   | $ | 232,036 |   | $ | 228,268 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Net Operating Income: (1)                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Office:                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Atlanta, GA                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | $                               | 7,973   |                          | $      | 7,828 |   | $ | 15,467 |   | $ | 15,461 |   |
| Greenville, SC                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                            | 2,067   |                          |   | 2,168 |   |   | 4,143 |   |   | 4,449 |   |
| Kansas City, MO                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 2,113   |                          |   | 2,327 |   |   | 4,228 |   |   | 4,540 |   |
| Memphis, TN                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 5,462   |                          |   | 4,223 |   |   | 11,224 |   |   | 9,507 |   |
| Nashville, TN                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                            | 10,329  |                          |   | 10,065 |   |   | 19,981 |   |   | 19,934 |   |
| Orlando, FL                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 1,285   |                          |   | 1,723 |   |   | 2,451 |   |   | 3,336 |   |
| Piedmont Triad, NC                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            | 3,452   |                          |   | 3,791 |   |   | 7,055 |   |   | 7,091 |   |
| Raleigh, NC                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 14,270  |                          |   | 13,046 |   |   | 27,473 |   |   | 25,675 |   |
| Richmond, VA                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                            | 8,232   |                          |   | 8,405 |   |   | 16,092 |   |   | 16,355 |   |
| Tampa, FL                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | 10,802  |                          |   | 10,991 |   |   | 21,192 |   |   | 21,811 |   |
| Total Office Segment                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 65,985  |                          |   | 64,567 |   |   | 129,306 |   |   | 128,159 |   |
| Industrial:                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Atlanta, GA                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 3,001   |                          |   | 2,793 |   |   | 5,841 |   |   | 5,563 |   |
| Piedmont Triad, NC                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            | 2,107   |                          |   | 2,328 |   |   | 4,332 |   |   | 4,375 |   |
| Total Industrial Segment                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                            | 5,108   |                          |   | 5,121 |   |   | 10,173 |   |   | 9,938 |   |
| Retail:                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Kansas City, MO                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 4,832   |                          |   | 5,746 |   |   | 10,123 |   |   | 10,098 |   |
| Total Retail Segment                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 4,832   |                          |   | 5,746 |   |   | 10,123 |   |   | 10,098 |   |
| Residential:                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Kansas City, MO                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | (11     | )                             |   | 188 |   |   | 93 |   |   | 426 |   |
| Total Residential Segment                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | (11     | )                             |   | 188 |   |   | 93 |   |   | 426 |   |
| Total Net Operating Income                                                                     |   |                            | 75,914  |                          |   | 75,622 |   |   | 149,695 |   |   | 148,621 |   |
| Reconciliation to income from continuing operations before disposition of property, condominiums and investment in unconsolidated affiliates and equity in earnings of unconsolidated affiliates:                                                                                                                                                                                                                                                  |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                            | (33,430 | )                             |   | (33,260 | ) |   | (67,147 | ) |   | (65,898 | ) |
| General and administrative expense                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            | (7,978  | )                             |   | (6,980 | ) |   | (15,771 | ) |   | (15,487 | ) |
| Interest expense                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                            | (23,907 | )                             |   | (22,934 | ) |   | (47,450 | ) |   | (46,047 | ) |
| Interest and other income                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | 1,875   |                          |   | 965 |   |   | 3,748 |   |   | 2,665 |   |
| Income from continuing operations before disposition of property, condominiums and investment in unconsolidated affiliates and equity in earnings of unconsolidated affiliates                                                                                                                                                                                                                                                                     |   | $                               | 12,474  |                          | $      | 13,413 |   | $ | 23,075 |   | $ | 23,854 |   |

| (1) | Net of discontinued operations. |
|-----|---------------------------------|

----

----

----

|                                                                                                                             |   | June 30,2011 |      | December 31,2010 |   |
|----------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|-----------|-----------------------|--------|
| Assets:                                                                                                                          |   |              |      |                  |   |   |
| Real estate assets, at cost:                                                                                                     |   |              |      |                  |   |   |   |
| Land                                                                                                                             |   | $                 | 345,791   |                  | $      | 345,088 |   |
| Buildings and tenant improvements                                                                                                |   |              | 2,886,871 |                  |   | 2,883,092 |   |
| Development in process                                                                                                           |   |              | 13,317    |                  |   | 4,524 |   |
| Land held for development                                                                                                        |   |              | 106,871   |                  |   | 107,101 |   |
|                                                                                                                             |   |              | 3,352,850 |                  |   | 3,339,805 |   |
| Less-accumulated depreciation                                                                                                    |   |              | (863,730  | )                     |   | (830,153 | ) |
| Net real estate assets                                                                                                           |   |              | 2,489,120 |                  |   | 2,509,652 |   |
| For-sale residential condominiums                                                                                                |   |              | 5,840     |                  |   | 8,225 |   |
| Real estate and other assets, net, held for sale                                                                                 |   |              | 11,609    |                  |   | 13,607 |   |
| Cash and cash equivalents                                                                                                        |   |              | 9,087     |                  |   | 14,198 |   |
| Restricted cash                                                                                                                  |   |              | 7,619     |                  |   | 4,399 |   |
| Accounts receivable, net of allowance of $3,470 and $3,595, respectively                                                         |   |              | 22,952    |                  |   | 20,716 |   |
| Mortgages and notes receivable, net of allowance of $617 and $868, respectively                                                  |   |              | 18,809    |                  |   | 19,044 |   |
| Accrued straight-line rents receivable, net of allowance of $1,360 and $2,209, respectively                                      |   |              | 99,466    |                  |   | 93,178 |   |
| Investment in and advances to unconsolidated affiliates                                                                          |   |              | 101,893   |                  |   | 62,451 |   |
| Deferred financing and leasing costs, net of accumulated amortization of $62,542 and $59,360, respectively                       |   |              | 85,168    |                  |   | 85,001 |   |
| Prepaid expenses and other assets                                                                                                |   |              | 36,533    |                  |   | 40,200 |   |
| Total Assets                                                                                                                     |   | $                 | 2,888,096 |                  | $      | 2,870,671 |   |
|                                                                                                                             |   |              |      |                  |   |   |   |
| Liabilities, Redeemable Operating Partnership Units and Equity:                                                                  |   |              |      |                  |   |   |   |
| Mortgages and notes payable                                                                                                      |   | $                 | 1,615,068 |                  | $      | 1,522,945 |   |
| Accounts payable, accrued expenses and other liabilities                                                                         |   |              | 106,105   |                  |   | 106,716 |   |
| Financing obligations                                                                                                            |   |              | 32,869    |                  |   | 33,114 |   |
| Total Liabilities                                                                                                                |   |              | 1,754,042 |                  |   | 1,662,775 |   |
| Commitments and Contingencies                                                                                                    |   |              |      |                  |   |   |   |
| Redeemable Operating Partnership Units:                                                                                          |   |              |      |                  |   |   |   |
| Common Units, 3,775,250 and 3,793,987 outstanding, respectively                                                                  |   |              | 125,075   |                  |   | 120,838 |   |
| Series A Preferred Units (liquidation preference $1,000 per unit), 29,087 and 29,092 shares issued and outstanding, respectively |   |              | 29,087    |                  |   | 29,092 |   |
| Series B Preferred Units (liquidation preference $25 per unit), 0 and 2,100,000 shares issued and outstanding, respectively      |   |              | —   |                  |   | 52,500 |   |
| Total Redeemable Operating Partnership Units                                                                                     |   |              | 154,162   |                  |   | 202,430 |   |
| Equity:                                                                                                                          |   |              |      |                  |   |   |   |
| Common Units:                                                                                                                    |   |              |      |                  |   |   |   |
| General partner Common Units, 757,659 and 750,757 outstanding, respectively                                                      |   |              | 9,794     |                  |   | 10,044 |   |
| Limited partner Common Units, 71,232,960 and 70,530,921 outstanding, respectively                                                |   |              | 969,829   |                  |   | 994,610 |   |
| Accumulated other comprehensive loss                                                                                             |   |              | (4,177    | )                     |   | (3,648 | ) |
| Noncontrolling interests in consolidated affiliates                                                                              |   |              | 4,446     |                  |   | 4,460 |   |
| Total Equity                                                                                                                     |   |              | 979,892   |                  |   | 1,005,466 |   |
| Total Liabilities, Redeemable Operating Partnership Units and Equity                                                             |   | $                 | 2,888,096 |                  | $      | 2,870,671 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Rental and other revenues                                                                                                  |   | $                               | 117,057 |                          | $      | 113,765 |   | $ | 232,036 |   | $ | 228,268 |   |
| Operating expenses:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Rental property and other expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 41,080  |                          |   | 38,253 |   |   | 82,427 |   |   | 79,437 |   |
| Depreciation and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            | 33,430  |                          |   | 33,260 |   |   | 67,147 |   |   | 65,898 |   |
| General and administrative                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                            | 8,041   |                          |   | 6,870 |   |   | 15,685 |   |   | 15,697 |   |
| Total operating expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                            | 82,551  |                          |   | 78,383 |   |   | 165,259 |   |   | 161,032 |   |
| Interest expense:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Contractual                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                            | 22,940  |                          |   | 21,705 |   |   | 45,371 |   |   | 43,507 |   |
| Amortization of deferred financing costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                            | 821     |                          |   | 835 |   |   | 1,642 |   |   | 1,670 |   |
| Financing obligations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            | 146     |                          |   | 394 |   |   | 437 |   |   | 870 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                            | 23,907  |                          |   | 22,934 |   |   | 47,450 |   |   | 46,047 |   |
| Other income:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Interest and other income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 1,899   |                          |   | 965 |   |   | 3,772 |   |   | 2,665 |   |
| Loss on debt extinguishment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                            | (24     | )                             |   | — |   |   | (24 | ) |   | — |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                            | 1,875   |                          |   | 965 |   |   | 3,748 |   |   | 2,665 |   |
| Income from continuing operations before disposition of property, condominiums and investment in unconsolidated affiliates and equity in earnings of unconsolidated affiliates                                                                                                                                                                                                                                                                                                                                                        |   |                            | 12,474  |                          |   | 13,413 |   |   | 23,075 |   |   | 23,854 |   |
| Gains on disposition of property                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                            | 200     |                          |   | 17 |   |   | 200 |   |   | 36 |   |
| Gains on disposition of for-sale residential condominiums                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 116     |                          |   | 163 |   |   | 154 |   |   | 353 |   |
| Gains on disposition of investment in unconsolidated affiliates                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                            | — |                          |   | 25,330 |   |   | — |   |   | 25,330 |   |
| Equity in earnings of unconsolidated affiliates                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                            | 1,357   |                          |   | 871 |   |   | 2,832 |   |   | 1,672 |   |
| Income from continuing operations                                                                                          |   |                            | 14,147  |                          |   | 39,794 |   |   | 26,261 |   |   | 51,245 |   |
| Discontinued operations:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                            | 291     |                          |   | 498 |   |   | 628 |   |   | 961 |   |
| Net losses on disposition of discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                            | — |                          |   | (260 | ) |   | — |   |   | (86 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                            | 291     |                          |   | 238 |   |   | 628 |   |   | 875 |   |
| Net income                                                                                                                 |   |                            | 14,438  |                          |   | 40,032 |   |   | 26,889 |   |   | 52,120 |   |
| Net (income) attributable to noncontrolling interests in consolidated affiliates                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                            | (182    | )                             |   | (215 | ) |   | (305 | ) |   | (429 | ) |
| Distributions on Preferred Units                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                            | (1,622  | )                             |   | (1,677 | ) |   | (3,299 | ) |   | (3,354 | ) |
| Excess of preferred unit redemption/repurchase cost over carrying value                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | (1,895  | )                             |   | — |   |   | (1,895 | ) |   | — |   |
| Net income available for common unitholders                                                                                |   | $                               | 10,739  |                          | $      | 38,140 |   | $ | 21,390 |   | $ | 48,337 |   |
| Earnings per Common Unit - basic:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations available for common unitholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                               | 0.14    |                          | $      | 0.51 |   | $ | 0.27 |   | $ | 0.64 |   |
| Income from discontinued operations available for common unitholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                            | — |                          |   | — |   |   | 0.01 |   |   | 0.01 |   |
| Net income available for common unitholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   | $                               | 0.14    |                          | $      | 0.51 |   | $ | 0.28 |   | $ | 0.65 |   |
| Weighted average Common Units outstanding - basic                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                            | 75,586  |                          |   | 74,989 |   |   | 75,393 |   |   | 74,907 |   |
| Earnings per Common Unit - diluted:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations available for common unitholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                               | 0.14    |                          | $      | 0.51 |   | $ | 0.27 |   | $ | 0.64 |   |
| Income from discontinued operations available for common unitholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                            | — |                          |   | — |   |   | 0.01 |   |   | — |   |
| Net income available for common unitholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   | $                               | 0.14    |                          | $      | 0.51 |   | $ | 0.28 |   | $ | 0.64 |   |
| Weighted average Common Units outstanding - diluted                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                            | 75,788  |                          |   | 75,198 |   |   | 75,578 |   |   | 75,095 |   |
| Distributions declared per Common Unit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | $                               | 0.425   |                          | $      | 0.425 |   | $ | 0.850 |   | $ | 0.850 |   |
| Net income available for common unitholders:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations available for common unitholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                               | 10,448  |                          | $      | 37,902 |   | $ | 20,762 |   | $ | 47,462 |   |
| Income from discontinued operations available for common unitholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                            | 291     |                          |   | 238 |   |   | 628 |   |   | 875 |   |
| Net income available for common unitholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   | $                               | 10,739  |                          | $      | 38,140 |   | $ | 21,390 |   | $ | 48,337 |   |

----

|                                                                                                            |   | Common Units   |    |           |   |                              |   |                                             |    |   |
|-----------------------------------------------------------------------------------------------------------------|--------|----------------|---------|----------------|--------|-----------------------------------|--------|--------------------------------------------------|---------|--------|
|                                                                                                            |   | GeneralPartner |    | LimitedPartner |   | AccumulatedOtherComprehensiveLoss |   | NoncontrollingInterests inConsolidatedAffiliates |    | Total  |   |
| Balance at December 31, 2010                                                                          |   | $              | 10,044  |           | $      | 994,610                           |   | $                                                | (3,648  | )      | $ | 4,460 |   | $ | 1,005,466 |   |
| Issuance of Common Units, net                                                                                   |   |           | 170     |           |   | 16,814                            |   |                                             | — |   |   | — |   |   | 16,984 |   |
| Distributions on Common Units                                                                                   |   |           | (640    | )              |   | (63,296                           | )      |                                             | — |   |   | — |   |   | (63,936 | ) |
| Distributions on Preferred Units                                                                                |   |           | (33     | )              |   | (3,266                            | )      |                                             | — |   |   | — |   |   | (3,299 | ) |
| Share-based compensation expense                                                                                |   |           | 35      |           |   | 3,418                             |   |                                             | — |   |   | — |   |   | 3,453 |   |
| Distribution to noncontrolling interests in consolidated affiliates                                             |   |           | — |           |   | —                           |   |                                             | — |   |   | (319 | ) |   | (319 | ) |
| Adjustment of Redeemable Common Units to fair value and contributions/distributions from/to the General Partner |   |           | (48     | )              |   | (4,769                            | )      |                                             | — |   |   | — |   |   | (4,817 | ) |
| Net (income) attributable to noncontrolling interests in consolidated affiliates                                |   |           | (3      | )              |   | (302                              | )      |                                             | — |   |   | 305 |   |   | — |   |
| Comprehensive income:                                                                                           |   |           |    |           |   |                              |   |                                             |    |   |   |   |   |   |   |   |
| Net income                                                                                                      |   |           | 269     |           |   | 26,620                            |   |                                             | — |   |   | — |   |   | 26,889 |   |
| Other comprehensive loss                                                                                        |   |           | — |           |   | —                           |   |                                             | (529    | )      |   | — |   |   | (529 | ) |
| Total comprehensive income                                                                                      |   |           |    |           |   |                              |   |                                             |    |   |   |   |   |   | 26,360 |   |
| Balance at June 30, 2011                                                                              |   | $              | 9,794   |           | $      | 969,829                           |   | $                                                | (4,177  | )      | $ | 4,446 |   | $ | 979,892 |   |

|                                                                                                            |   | Common Units   |    |           |   |                              |   |                                             |    |         |
|-----------------------------------------------------------------------------------------------------------------|--------|----------------|---------|----------------|--------|-----------------------------------|--------|--------------------------------------------------|---------|--------------|
|                                                                                                            |   | GeneralPartner |    | LimitedPartner |   | AccumulatedOtherComprehensiveLoss |   | NoncontrollingInterests inConsolidatedAffiliates |    | TotalCapital |   |
| Balance at December 31, 2009                                                                                    |   | $              | 10,485  |           | $      | 1,038,328                         |   | $                                                | (3,811  | )            | $ | 5,183 |   | $ | 1,050,185 |   |
| Issuance of Common Units, net                                                                                   |   |           | 11      |           |   | 1,051                             |   |                                             | — |         |   | — |   |   | 1,062 |   |
| Distributions on Common Units                                                                                   |   |           | (637    | )              |   | (63,011                           | )      |                                             | — |         |   | — |   |   | (63,648 | ) |
| Distributions on Preferred Units                                                                                |   |           | (34     | )              |   | (3,320                            | )      |                                             | — |         |   | — |   |   | (3,354 | ) |
| Share-based compensation expense                                                                                |   |           | 35      |           |   | 3,462                             |   |                                             | — |         |   | — |   |   | 3,497 |   |
| Distribution to noncontrolling interests in consolidated affiliates                                             |   |           | — |           |   | —                           |   |                                             | — |         |   | (324 | ) |   | (324 | ) |
| Adjustment of Redeemable Common Units to fair value and contributions/distributions from/to the General Partner |   |           | 243     |           |   | 24,039                            |   |                                             | — |         |   | — |   |   | 24,282 |   |
| Net (income) attributable to noncontrolling interests in consolidated affiliates                                |   |           | (4      | )              |   | (425                              | )      |                                             | — |         |   | 429 |   |   | — |   |
| Comprehensive income:                                                                                           |   |           |    |           |   |                              |   |                                             |    |         |   |   |   |   |   |   |
| Net income                                                                                                      |   |           | 521     |           |   | 51,599                            |   |                                             | — |         |   | — |   |   | 52,120 |   |
| Other comprehensive income                                                                                      |   |           | — |           |   | —                           |   |                                             | 536     |         |   | — |   |   | 536 |   |
| Total comprehensive income                                                                                      |   |           |    |           |   |                              |   |                                             |    |         |   |   |   |   | 52,656 |   |
| Balance at June 30, 2010                                                                              |   | $              | 10,620  |           | $      | 1,051,723                         |   | $                                                | (3,275  | )            | $ | 5,288 |   | $ | 1,064,356 |   |

----

|                                                                                       |   | Six Months EndedJune 30, |     |
|--------------------------------------------------------------------------------------------|--------|-------------------------------|----------|
|                                                                                       |   | 2011                          |     | 2010 |   |
| Operating activities:                                                                      |   |                          |     |   |   |   |   |
| Net income                                                                                 |   | $                             | 26,889   |   | $ | 52,120 |   |
| Adjustments to reconcile net income to net cash provided by operating activities:          |   |                          |     |   |   |   |   |
| Depreciation and amortization                                                              |   |                          | 67,274   |   |   | 66,447 |   |
| Amortization of lease incentives and acquisition-related intangible assets and liabilities |   |                          | 968      |   |   | 537 |   |
| Share-based compensation expense                                                           |   |                          | 3,453    |   |   | 3,497 |   |
| Allowance for losses on accounts and accrued straight-line rents receivable                |   |                          | 1,029    |   |   | 2,636 |   |
| Amortization of deferred financing costs                                                   |   |                          | 1,642    |   |   | 1,670 |   |
| Amortization of settled cash-flow hedges                                                   |   |                          | (58      | ) |   | 287 |   |
| Loss on debt extinguishment                                                                |   |                          | 24       |   |   | — |   |
| Net (gains)/losses on disposition of property                                              |   |                          | (200     | ) |   | 50 |   |
| Gains on disposition of for-sale residential condominiums                                  |   |                          | (154     | ) |   | (353 | ) |
| Gains on disposition of investment in unconsolidated affiliates                            |   |                          | —  |   |   | (25,330 | ) |
| Equity in earnings of unconsolidated affiliates                                            |   |                          | (2,832   | ) |   | (1,672 | ) |
| Changes in financing obligations                                                           |   |                          | (245     | ) |   | 81 |   |
| Distributions of earnings from unconsolidated affiliates                                   |   |                          | 2,150    |   |   | 1,704 |   |
| Changes in operating assets and liabilities:                                               |   |                          |     |   |   |   |   |
| Accounts receivable                                                                        |   |                          | (1,821   | ) |   | (1,616 | ) |
| Prepaid expenses and other assets                                                          |   |                          | (544     | ) |   | 1,769 |   |
| Accrued straight-line rents receivable                                                     |   |                          | (6,098   | ) |   | (5,296 | ) |
| Accounts payable, accrued expenses and other liabilities                                   |   |                          | (3,794   | ) |   | 3,352 |   |
| Net cash provided by operating activities                                                  |   |                          | 87,683   |   |   | 99,883 |   |
| Investing activities:                                                                      |   |                          |     |   |   |   |   |
| Additions to real estate assets and deferred leasing costs                                 |   |                          | (44,447  | ) |   | (38,292 | ) |
| Net proceeds from disposition of real estate assets                                        |   |                          | 2,063    |   |   | 6,801 |   |
| Net proceeds from disposition of for-sale residential condominiums                         |   |                          | 2,401    |   |   | 3,186 |   |
| Proceeds from disposition of investment in unconsolidated affiliates                       |   |                          | —  |   |   | 15,000 |   |
| Distributions of capital from unconsolidated affiliates                                    |   |                          | 632      |   |   | 1,106 |   |
| Repayments of mortgages and notes receivable                                               |   |                          | 235      |   |   | 29 |   |
| Investment in and advances to unconsolidated affiliates                                    |   |                          | (39,402  | ) |   | (303 | ) |
| Changes in restricted cash and other investing activities                                  |   |                          | (395     | ) |   | (3,178 | ) |
| Net cash used in investing activities                                                      |   |                          | (78,913  | ) |   | (15,651 | ) |
| Financing activities:                                                                      |   |                          |     |   |   |   |   |
| Distributions on Common Units                                                              |   |                          | (63,936  | ) |   | (63,648 | ) |
| Redemptions/repurchases of Preferred Units                                                 |   |                          | (52,505  | ) |   | — |   |
| Distributions on Preferred Units                                                           |   |                          | (3,299   | ) |   | (3,354 | ) |
| Distributions to noncontrolling interests in consolidated affiliates                       |   |                          | (319     | ) |   | (324 | ) |
| Net proceeds from the issuance of Common Units                                             |   |                          | 16,984   |   |   | 1,062 |   |
| Borrowings on revolving credit facility                                                    |   |                          | 124,700  |   |   | 4,000 |   |
| Repayments of revolving credit facility                                                    |   |                          | (79,300  | ) |   | (4,000 | ) |
| Borrowings on mortgages and notes payable                                                  |   |                          | 200,000  |   |   | — |   |
| Repayments of mortgages and notes payable                                                  |   |                          | (153,522 | ) |   | (5,452 | ) |
| Additions to deferred financing costs and other financing activities                       |   |                          | (2,684   | ) |   | (290 | ) |
| Net cash used in financing activities                                                      |   |                          | (13,881  | ) |   | (72,006 | ) |
| Net increase/(decrease) in cash and cash equivalents                                       |   |                          | (5,111   | ) |   | 12,226 |   |
| Cash and cash equivalents at beginning of the period                                       |   |                          | 14,198   |   |   | 23,519 |   |
| Cash and cash equivalents at end of the period                                             |   | $                             | 9,087    |   | $ | 35,745 |   |

----

|                                               |   | Six Months EndedJune 30, |   |
|----------------------------------------------------|--------|-------------------------------|--------|
|                                               |   | 2011                          |   | 2010 |   |
| Cash paid for interest, net of amounts capitalized |   | $                             | 44,948 |   | $ | 43,204 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | Six Months EndedJune 30, |    |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|---------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | 2011                          |    | 2010 |   |
| Change in accrued capital expenditures                                                                                                                                     |   | $                             | 1,525   |   | $ | (2,294 | ) |
| Write-off of fully depreciated real estate assets                                                                                                                          |   | $                             | 23,352  |   | $ | 24,273 |   |
| Write-off of fully amortized deferred financing and leasing costs                                                                                                          |   | $                             | 8,247   |   | $ | 7,963 |   |
| Unrealized gains on marketable securities of non-qualified deferred compensation plan                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | $                             | 210     |   | $ | 174 |   |
| Settlement of financing obligation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | $                             | — |   | $ | 4,184 |   |
| Adjustment of Redeemable Common Units to fair value                                                                                                                        |   | $                             | 4,237   |   | $ | (24,360 | ) |
| Unrealized gain/(loss) on tax increment financing bond                                                                                                                     |   | $                             | (471    | ) | $ | 146 |   |
| Mortgages receivable from seller financing                                                                                                                                 |   | $                             | — |   | $ | 17,030 |   |

----

----

|                                |   | June 30,2011 |    | December 31,2010 |   |
|-------------------------------------|--------|-------------------|---------|------------------|--------|
| Seller financing (first mortgages)  |   | $                 | 17,180  |             | $      | 17,180 |   |
| Less allowance                      |   |              | — |             |   | — |   |
|                                |   |              | 17,180  |             |   | 17,180 |   |
| Promissory notes                    |   |              | 2,246   |             |   | 2,732 |   |
| Less allowance                      |   |              | (617    | )                |   | (868 | ) |
|                                |   |              | 1,629   |             |   | 1,864 |   |
| Mortgages and notes receivable, net |   | $                 | 18,809  |             | $      | 19,044 |   |

----

|                                 |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|--------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                 |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Beginning notes receivable allowance |   | $                               | 497     |                          | $      | 732 |   | $ | 868 |   | $ | 698 |   |
| Bad debt expense                     |   |                            | 162     |                          |   | 25 |   |   | 184 |   |   | 88 |   |
| Write-offs                           |   |                            | — |                          |   | (5 | ) |   | (364 | ) |   | (5 | ) |
| Recoveries/other                     |   |                            | (42     | )                             |   | 19 |   |   | (71 | ) |   | (10 | ) |
| Total notes receivable allowance     |   | $                               | 617     |                          | $      | 771 |   | $ | 617 |   | $ | 771 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | Three Months EndedJune 30, |   | Six Months EndedJune 30, |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|--------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | 2011                            |   | 2010                          |   | 2011 |   | 2010 |   |
| Income Statements:                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                            |   |                          |   |   |   |   |   |   |   |   |   |
| Revenues                                                                       |   | $                               | 23,756 |                          | $      | 30,697 |   | $ | 47,958 |   | $ | 65,266 |   |
| Expenses:                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            |   |                          |   |   |   |   |   |   |   |   |   |
| Rental property and other expenses                                                                                                                                                                                                                                                                                                                                                                                                           |   |                            | 10,155 |                          |   | 15,128 |   |   | 21,526 |   |   | 31,655 |   |
| Depreciation and amortization                                                                                                                                                                                                                                                                                                                                                                                                                |   |                            | 6,053  |                          |   | 7,410 |   |   | 12,299 |   |   | 16,641 |   |
| Interest expense                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 5,683  |                          |   | 7,037 |   |   | 11,508 |   |   | 15,404 |   |
| Total expenses                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 21,891 |                          |   | 29,575 |   |   | 45,333 |   |   | 63,700 |   |
| Net income                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | $                               | 1,865  |                          | $      | 1,122 |   | $ | 2,625 |   | $ | 1,566 |   |
| Our share of:                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                            |   |                          |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization of real estate assets                                                                                                                                                                                                                                                                                                                                                                                          |   | $                               | 1,995  |                          | $      | 2,699 |   | $ | 4,050 |   | $ | 6,001 |   |
| Interest expense                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $                               | 2,012  |                          | $      | 2,730 |   | $ | 4,149 |   | $ | 6,128 |   |
| Net income                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | $                               | 759    |                          | $      | 307 |   | $ | 1,694 |   | $ | 535 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            |   |                          |   |   |   |   |   |   |   |   |   |
| Our share of net income                                                                                                                                                                                                                                                                                                                                                                                                                      |   | $                               | 759    |                          | $      | 307 |   | $ | 1,694 |   | $ | 535 |   |
| Purchase accounting and management, leasing and other feesadjustments                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 598    |                          |   | 564 |   |   | 1,138 |   |   | 1,137 |   |
| Equity in earnings of unconsolidated affiliates                                                                                                                                                                                                                                                                                                                                                                                              |   | $                               | 1,357  |                          | $      | 871 |   | $ | 2,832 |   | $ | 1,672 |   |

----

|                                                                                          |   | June 30,2011 |    | December 31,2010 |   |
|-----------------------------------------------------------------------------------------------|--------|-------------------|---------|------------------|--------|
| Assets:                                                                                       |   |              |    |             |   |   |   |
| Deferred financing costs                                                                      |   | $                 | 17,295  |             | $      | 16,412 |   |
| Less accumulated amortization                                                                 |   |              | (7,996  | )                |   | (7,054 | ) |
|                                                                                          |   |              | 9,299   |             |   | 9,358 |   |
| Deferred leasing costs (including lease incentives and acquisition-related intangible assets) |   |              | 130,415 |             |   | 127,949 |   |
| Less accumulated amortization                                                                 |   |              | (54,546 | )                |   | (52,306 | ) |
|                                                                                          |   |              | 75,869  |             |   | 75,643 |   |
| Deferred financing and leasing costs, net                                                     |   | $                 | 85,168  |             | $      | 85,001 |   |
|                                                                                          |   |              |    |             |   |   |   |
| Liabilities (in accounts payable, accrued expenses and other liabilities):                    |   |              |    |             |   |   |   |
| Acquisition-related intangible liabilities                                                    |   | $                 | 720     |             | $      | 658 |   |
| Less accumulated amortization                                                                 |   |              | (226    | )                |   | (125 | ) |
|                                                                                          |   | $                 | 494     |             | $      | 533 |   |

|                                                                                                                |   | Three Months EndedJune 30, |   | Six Months EndedJune 30, |   |
|---------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|--------|-------------------------------|--------|
|                                                                                                                |   | 2011                            |   | 2010                          |   | 2011 |   | 2010 |   |
| Amortization of deferred financing costs                                                                            |   | $                               | 821    |                          | $      | 835 |   | $ | 1,642 |   | $ | 1,670 |   |
| Amortization of deferred leasing costs and acquisition-related intangible assets (in depreciation and amortization) |   | $                               | 4,401  |                          | $      | 3,817 |   | $ | 8,757 |   | $ | 7,583 |   |
| Amortization of lease incentives (in rental and other revenues)                                                     |   | $                               | 303    |                          | $      | 276 |   | $ | 641 |   | $ | 537 |   |
| Amortization of acquisition-related intangible assets and liabilities (in rental and other revenues)                |   | $                               | 166    |                          | $      | 36 |   | $ | 327 |   | $ | 76 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                     |   | Amortization of Deferred Financing Costs |   | Amortization of Deferred Leasing Costs and Acquisition-Related Intangible Assets (in Depreciation and Amortization) |   | Amortization of Lease Incentives (in Rental and Other Revenues) |   | Amortization of Acquisition-Related Intangible Assets and Liabilities (in Rental and Other Revenues) |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------|--------|
| July 1, 2011 through December 31, 2011                                                                                                                                                                                                                                                                                                                               |   | $                                        | 1,724  |                                                                                                                | $      | 8,653                                                           |   | $                                                                                                    | 613    |   | $ | 320 |   |
| 2012                                                                    |   |                                     | 3,093  |                                                                                                                |   | 15,087                                                          |   |                                                                                                 | 1,141  |   |   | 561 |   |
| 2013                                                                    |   |                                     | 1,486  |                                                                                                                |   | 12,106                                                          |   |                                                                                                 | 983    |   |   | 390 |   |
| 2014                                                                    |   |                                     | 1,098  |                                                                                                                |   | 9,398                                                           |   |                                                                                                 | 819    |   |   | 298 |   |
| 2015                                                                    |   |                                     | 1,098  |                                                                                                                |   | 6,966                                                           |   |                                                                                                 | 603    |   |   | 188 |   |
| Thereafter                                                              |   |                                     | 800    |                                                                                                                |   | 14,690                                                          |   |                                                                                                 | 2,088  |   |   | 471 |   |
|                                                                                                                                                                                                                                                                                                                                                                                     |   | $                                        | 9,299  |                                                                                                                | $      | 66,900                                                          |   | $                                                                                                    | 6,247  |   | $ | 2,228 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | June 30,2011 |      | December 31,2010 |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|-----------|------------------|--------|
| Secured indebtedness                                                                                                         |   | $                 | 748,563   |             | $      | 754,399 |   |
| Unsecured indebtedness                                                                                                       |   |              | 866,505   |             |   | 768,546 |   |
| Total mortgages and notes payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   | $                 | 1,615,068 |             | $      | 1,522,945 |   |

----

|                                                                                                         |   | June 30,2011 |   | Level 1 |   | Level 3 |   |
|--------------------------------------------------------------------------------------------------------------|--------|-------------------|--------|---------|--------|---------|--------|
| Assets:                                                                                                      |   |              |   |    |   |    |   |   |   |   |
| Marketable securities of non-qualified deferred compensation plan (in prepaid expenses and other assets)     |   | $                 | 3,876  |    | $      | 3,876   |   | $ | — |   |
| Tax increment financing bond (in prepaid expenses and other assets)                                          |   |              | 15,228 |    |   | — |   |   | 15,228 |   |
| Total Assets                                                                                                 |   | $                 | 19,104 |    | $      | 3,876   |   | $ | 15,228 |   |
|                                                                                                         |   |              |   |    |   |    |   |   |   |   |
| Liability:                                                                                                   |   |              |   |    |   |    |   |   |   |   |
| Non-qualified deferred compensation obligation (in accounts payable, accrued expenses and other liabilities) |   | $                 | 3,876  |    | $      | 3,876   |   | $ | — |   |

----

|                                                                                                         |   | December 31,2010 |   | Level 1 |   | Level 3 |   |
|--------------------------------------------------------------------------------------------------------------|--------|-----------------------|--------|---------|--------|---------|--------|
| Assets:                                                                                                      |   |                  |   |    |   |    |   |   |   |   |
| Marketable securities of non-qualified deferred compensation plan (in prepaid expenses and other assets)     |   | $                     | 3,479  |    | $      | 3,479   |   | $ | — |   |
| Tax increment financing bond (in prepaid expenses and other assets)                                          |   |                  | 15,699 |    |   | — |   |   | 15,699 |   |
| Total Assets                                                                                                 |   | $                     | 19,178 |    | $      | 3,479   |   | $ | 15,699 |   |
|                                                                                                         |   |                  |   |    |   |    |   |   |   |   |
| Liability:                                                                                                   |   |                  |   |    |   |    |   |   |   |   |
| Non-qualified deferred compensation obligation (in accounts payable, accrued expenses and other liabilities) |   | $                     | 4,091  |    | $      | 4,091   |   | $ | — |   |

|                             |   | Three Months EndedJune 30, |   | Six Months EndedJune 30, |   |
|----------------------------------|--------|---------------------------------|--------|-------------------------------|--------|
|                             |   | 2011                            |   | 2010                          |   | 2011 |   | 2010 |   |
| Asset:                           |   |                            |   |                          |   |   |   |   |   |   |   |   |   |
| Tax Increment Financing Bond     |   |                            |   |                          |   |   |   |   |   |   |   |   |   |
| Beginning balance                |   | $                               | 15,564 |                          | $      | 17,090 |   | $ | 15,699 |   | $ | 16,871 |   |
| Unrealized gain/(loss) (in AOCL) |   |                            | (336   | )                             |   | (73 | ) |   | (471 | ) |   | 146 |   |
| Ending balance                   |   | $                               | 15,228 |                          | $      | 17,017 |   | $ | 15,228 |   | $ | 17,017 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   | CarryingAmount |      | Fair Value |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------|-----------|------------|--------|
| June 30, 2011                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |           |      |       |   |   |   |
| Mortgages and notes receivable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | $              | 18,809    |       | $      | 19,141 |   |
| Mortgages and notes payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $              | 1,615,068 |       | $      | 1,725,186 |   |
| Financing obligations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   | $              | 32,869    |       | $      | 20,852 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |           |      |       |   |   |   |
| December 31, 2010                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |           |      |       |   |   |   |
| Mortgages and notes receivable                                                                                                 |   | $              | 19,044    |       | $      | 19,093 |   |
| Mortgages and notes payable                                                                                                    |   | $              | 1,522,945 |       | $      | 1,581,518 |   |
| Financing obligations                                                                                                          |   | $              | 33,114    |       | $      | 23,880 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Net income                                                                              |   | $                               | 14,438  |                          | $      | 40,032 |   | $ | 26,889 |   | $ | 52,120 |   |
| Other comprehensive income/(loss):                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Unrealized gain/(loss) on tax increment financing bond                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                            | (336    | )                             |   | (73 | ) |   | (471 | ) |   | 146 |   |
| Amortization of settled cash-flow hedges                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            | (29     | )                             |   | 48 |   |   | (58 | ) |   | 287 |   |
| Sale of cash-flow hedge related to disposition of investmentin unconsolidated affiliate                                                                                                                                                                                                                                                                                                                                                                                                  |   |                            | — |                          |   | 103 |   |   | — |   |   | 103 |   |
| Total other comprehensive income/(loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                            | (365    | )                             |   | 78 |   |   | (529 | ) |   | 536 |   |
| Total comprehensive income                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | $                               | 14,073  |                          | $      | 40,110 |   | $ | 26,360 |   | $ | 52,656 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | June 30,2011 |   | December 31,2010 |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|--------|------------------|--------|
| Tax increment financing bond                                                                                                       |   | $                 | 3,013  |             | $      | 2,543 |   |
| Settled cash-flow hedges                                                                                                           |   |              | 1,164  |             |   | 1,105 |   |
| Total accumulated other comprehensive loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | $                 | 4,177  |             | $      | 3,648 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Rental and other revenues                                                                                          |   | $                               | 500     |                          | $      | 1,227 |   | $ | 1,113 |   | $ | 2,557 |   |
| Operating expenses:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Rental property and other expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | 178     |                          |   | 455 |   |   | 359 |   |   | 1,048 |   |
| Depreciation and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 32      |                          |   | 275 |   |   | 127 |   |   | 549 |   |
| Total operating expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 210     |                          |   | 730 |   |   | 486 |   |   | 1,597 |   |
| Other income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                            | 1       |                          |   | 1 |   |   | 1 |   |   | 1 |   |
| Income from discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            | 291     |                          |   | 498 |   |   | 628 |   |   | 961 |   |
| Net losses on disposition of discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | — |                          |   | (260 | ) |   | — |   |   | (86 | ) |
| Total discontinued operations                                                                                      |   | $                               | 291     |                          | $      | 238 |   | $ | 628 |   | $ | 875 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | June 30,2011 |    | December 31,2010 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|---------|------------------|--------|
| Assets:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |              |    |             |   |   |   |
| Land                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | $                 | 2,788   |             | $      | 2,788 |   |
| Buildings and tenant improvements                                                                                                                                                             |   |              | 12,663  |             |   | 12,707 |   |
| Land held for development                                                                                                                                                                     |   |              | 967     |             |   | 2,766 |   |
| Total real estate assets                                                                                                                                                                                               |   |              | 16,418  |             |   | 18,261 |   |
| Less accumulated depreciation                                                                                                                                                                 |   |              | (5,113  | )                |   | (5,012 | ) |
| Net real estate assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |              | 11,305  |             |   | 13,249 |   |
| Deferred leasing costs, net                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |              | 55      |             |   | 58 |   |
| Accrued straight line rents receivable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |              | 249     |             |   | 257 |   |
| Prepaid expenses and other assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |              | — |             |   | 43 |   |
| Real estate and other assets, net, held for sale                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | $                 | 11,609  |             | $      | 13,607 |   |
| Tenant security deposits, deferred rents and accrued costs (1)                                                                                                       |   | $                 | 123     |             | $      | 11 |   |

| (1) | Included in accounts payable, accrued expenses and other liabilities. |
|-----|-----------------------------------------------------------------------|

----

|                                                                                                                 |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|----------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                 |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Earnings per Common Unit - basic:                                                                                    |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Numerator:                                                                                                           |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations                                                                                    |   | $                               | 14,147  |                          | $      | 39,794 |   | $ | 26,261 |   | $ | 51,245 |   |
| Net (income) attributable to noncontrolling interests in consolidated affiliates from continuing operations          |   |                            | (182    | )                             |   | (215 | ) |   | (305 | ) |   | (429 | ) |
| Distributions on Preferred Units                                                                                     |   |                            | (1,622  | )                             |   | (1,677 | ) |   | (3,299 | ) |   | (3,354 | ) |
| Excess of Preferred Unit redemption/repurchase cost over carrying value                                              |   |                            | (1,895  | )                             |   | — |   |   | (1,895 | ) |   | — |   |
| Income from continuing operations available for common unitholders                                                   |   |                            | 10,448  |                          |   | 37,902 |   |   | 20,762 |   |   | 47,462 |   |
| Income from discontinued operations                                                                                  |   |                            | 291     |                          |   | 238 |   |   | 628 |   |   | 875 |   |
| Net income available for common unitholders                                                                          |   | $                               | 10,739  |                          | $      | 38,140 |   | $ | 21,390 |   | $ | 48,337 |   |
| Denominator:                                                                                                         |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Denominator for basic earnings per Common Unit – weighted averageunits                                         |   |                            | 75,586  |                          |   | 74,989 |   |   | 75,393 |   |   | 74,907 |   |
| Earnings per Common Unit – basic:                                                                              |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations available for common unitholders                                                   |   | $                               | 0.14    |                          | $      | 0.51 |   | $ | 0.27 |   | $ | 0.64 |   |
| Income from discontinued operations available for common unitholders                                                 |   |                            | — |                          |   | — |   |   | 0.01 |   |   | 0.01 |   |
| Net income available for common unitholders                                                                          |   | $                               | 0.14    |                          | $      | 0.51 |   | $ | 0.28 |   | $ | 0.65 |   |
| Earnings per Common Unit - diluted:                                                                                  |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Numerator:                                                                                                           |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations                                                                                    |   | $                               | 14,147  |                          | $      | 39,794 |   | $ | 26,261 |   | $ | 51,245 |   |
| Net (income) attributable to noncontrolling interests in consolidated affiliates from continuing operations          |   |                            | (182    | )                             |   | (215 | ) |   | (305 | ) |   | (429 | ) |
| Distributions on Preferred Units                                                                                     |   |                            | (1,622  | )                             |   | (1,677 | ) |   | (3,299 | ) |   | (3,354 | ) |
| Excess of Preferred Unit redemption/repurchase cost over carrying value                                              |   |                            | (1,895  | )                             |   | — |   |   | (1,895 | ) |   | — |   |
| Income from continuing operations available for common unitholders                                                   |   |                            | 10,448  |                          |   | 37,902 |   |   | 20,762 |   |   | 47,462 |   |
| Income from discontinued operations                                                                                  |   |                            | 291     |                          |   | 238 |   |   | 628 |   |   | 875 |   |
| Net income available for common unitholders                                                                          |   | $                               | 10,739  |                          | $      | 38,140 |   | $ | 21,390 |   | $ | 48,337 |   |
| Denominator:                                                                                                         |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Denominator for basic earnings per Common Unit –weighted averageunits                                          |   |                            | 75,586  |                          |   | 74,989 |   |   | 75,393 |   |   | 74,907 |   |
| Add:                                                                                                                 |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Units options using the treasury method                                                                              |   |                            | 202     |                          |   | 209 |   |   | 185 |   |   | 188 |   |
| Denominator for diluted earnings per Common Unit – adjusted weighted average units and assumed conversions (1) |   |                            | 75,788  |                          |   | 75,198 |   |   | 75,578 |   |   | 75,095 |   |
| Earnings per Common Unit – diluted:                                                                            |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Income from continuing operations available for common unitholders                                                   |   | $                               | 0.14    |                          |   | 0.51 |   |   | 0.27 |   |   | 0.64 |   |
| Income from discontinued operations available for common unitholders                                                 |   |                            | — |                          |   | — |   |   | 0.01 |   |   | — |   |
| Net income available for common unitholders                                                                          |   | $                               | 0.14    |                          |   | 0.51 |   |   | 0.28 |   |   | 0.64 |   |

| (1) | There were 0.3 million and 0.6 million options outstanding during the three and six months ended June 30, 2011 and 2010, respectively, that were not included in the computation of diluted earnings per share because the impact of including such options would be anti-dilutive. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Rental and Other Revenues: (1)                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Office:                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Atlanta, GA                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $                               | 12,341  |                          | $      | 12,065 |   | $ | 24,245 |   | $ | 24,198 |   |
| Greenville, SC                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | 3,437   |                          |   | 3,451 |   |   | 6,943 |   |   | 7,127 |   |
| Kansas City, MO                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            | 3,586   |                          |   | 3,663 |   |   | 7,243 |   |   | 7,371 |   |
| Memphis, TN                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 10,077  |                          |   | 7,328 |   |   | 20,180 |   |   | 15,196 |   |
| Nashville, TN                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                            | 15,362  |                          |   | 14,851 |   |   | 29,977 |   |   | 29,964 |   |
| Orlando, FL                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 2,619   |                          |   | 3,059 |   |   | 4,937 |   |   | 6,064 |   |
| Piedmont Triad, NC                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                            | 5,273   |                          |   | 5,367 |   |   | 10,637 |   |   | 10,764 |   |
| Raleigh, NC                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 20,103  |                          |   | 18,523 |   |   | 39,423 |   |   | 37,328 |   |
| Richmond, VA                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                            | 11,668  |                          |   | 11,483 |   |   | 23,047 |   |   | 23,276 |   |
| Tampa, FL                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 17,458  |                          |   | 18,037 |   |   | 34,250 |   |   | 35,979 |   |
| Total Office Segment                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 101,924 |                          |   | 97,827 |   |   | 200,882 |   |   | 197,267 |   |
| Industrial:                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Atlanta, GA                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            | 4,028   |                          |   | 3,842 |   |   | 7,962 |   |   | 7,817 |   |
| Piedmont Triad, NC                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                            | 2,825   |                          |   | 3,044 |   |   | 5,803 |   |   | 6,065 |   |
| Total Industrial Segment                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                            | 6,853   |                          |   | 6,886 |   |   | 13,765 |   |   | 13,882 |   |
| Retail:                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Kansas City, MO                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                            | 8,203   |                          |   | 8,749 |   |   | 17,104 |   |   | 16,437 |   |
| Total Retail Segment                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 8,203   |                          |   | 8,749 |   |   | 17,104 |   |   | 16,437 |   |
| Residential:                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Kansas City, MO                                                                                                                                            |   |                            | 77      |                          |   | 303 |   |   | 285 |   |   | 682 |   |
| Total Residential Segment                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 77      |                          |   | 303 |   |   | 285 |   |   | 682 |   |
| Total Rental and Other Revenues                                                                     |   | $                               | 117,057 |                          | $      | 113,765 |   | $ | 232,036 |   | $ | 228,268 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Net Operating Income: (1)                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Office:                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Atlanta, GA                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | $                               | 7,980   |                          | $      | 7,816 |   | $ | 15,458 |   | $ | 15,484 |   |
| Greenville, SC                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                            | 2,069   |                          |   | 2,165 |   |   | 4,141 |   |   | 4,455 |   |
| Kansas City, MO                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 2,115   |                          |   | 2,324 |   |   | 4,226 |   |   | 4,546 |   |
| Memphis, TN                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 5,467   |                          |   | 4,217 |   |   | 11,217 |   |   | 9,520 |   |
| Nashville, TN                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                            | 10,337  |                          |   | 10,050 |   |   | 19,970 |   |   | 19,963 |   |
| Orlando, FL                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 1,286   |                          |   | 1,720 |   |   | 2,450 |   |   | 3,341 |   |
| Piedmont Triad, NC                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            | 3,455   |                          |   | 3,785 |   |   | 7,051 |   |   | 7,099 |   |
| Raleigh, NC                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 14,281  |                          |   | 13,026 |   |   | 27,457 |   |   | 25,712 |   |
| Richmond, VA                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                            | 8,239   |                          |   | 8,393 |   |   | 16,083 |   |   | 16,378 |   |
| Tampa, FL                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | 10,811  |                          |   | 10,976 |   |   | 21,179 |   |   | 21,842 |   |
| Total Office Segment                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 66,040  |                          |   | 64,472 |   |   | 129,232 |   |   | 128,340 |   |
| Industrial:                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Atlanta, GA                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                            | 3,003   |                          |   | 2,789 |   |   | 5,838 |   |   | 5,571 |   |
| Piedmont Triad, NC                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            | 2,109   |                          |   | 2,325 |   |   | 4,330 |   |   | 4,381 |   |
| Total Industrial Segment                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                            | 5,112   |                          |   | 5,114 |   |   | 10,168 |   |   | 9,952 |   |
| Retail:                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Kansas City, MO                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | 4,836   |                          |   | 5,738 |   |   | 10,116 |   |   | 10,112 |   |
| Total Retail Segment                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                            | 4,836   |                          |   | 5,738 |   |   | 10,116 |   |   | 10,112 |   |
| Residential:                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Kansas City, MO                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                            | (11     | )                             |   | 188 |   |   | 93 |   |   | 427 |   |
| Total Residential Segment                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | (11     | )                             |   | 188 |   |   | 93 |   |   | 427 |   |
| Total Net Operating Income                                                                     |   |                            | 75,977  |                          |   | 75,512 |   |   | 149,609 |   |   | 148,831 |   |
| Reconciliation to income from continuing operations before disposition of property, condominiums and investment in unconsolidated affiliates and equity in earnings of unconsolidated affiliates:                                                                                                                                                                                                                                                  |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                            | (33,430 | )                             |   | (33,260 | ) |   | (67,147 | ) |   | (65,898 | ) |
| General and administrative expense                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                            | (8,041  | )                             |   | (6,870 | ) |   | (15,685 | ) |   | (15,697 | ) |
| Interest expense                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                            | (23,907 | )                             |   | (22,934 | ) |   | (47,450 | ) |   | (46,047 | ) |
| Interest and other income                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                            | 1,875   |                          |   | 965 |   |   | 3,748 |   |   | 2,665 |   |
| Income from continuing operations before disposition of property, condominiums and investment in unconsolidated affiliates and equity in earnings of unconsolidated affiliates                                                                                                                                                                                                                                                                     |   | $                               | 12,474  |                          | $      | 13,413 |   | $ | 23,075 |   | $ | 23,854 |   |

| (1) | Net of discontinued operations. |
|-----|---------------------------------|

----

----

|   | · | the financial condition of our customers could deteriorate; |
|--------|--------|-------------------------------------------------------------|

|   | · | we may not be able to lease or release second generation space, defined as previously occupied space that becomes available for lease, quickly or on as favorable terms as old leases; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | we may not be able to lease our newly constructed buildings as quickly or on as favorable terms as originally anticipated; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------|

|   | · | we may not be able to complete development, acquisition, reinvestment, disposition or joint venture projects as quickly or on as favorable terms as anticipated; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | development activity by our competitors in our existing markets could result in an excessive supply of office, industrial and retail properties relative to customer demand; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | our markets may suffer declines in economic growth; |
|--------|--------|-----------------------------------------------------|

|   | · | unanticipated increases in interest rates could increase our debt service costs; |
|--------|--------|----------------------------------------------------------------------------------|

|   | · | unanticipated increases in operating expenses could negatively impact our operating results; |
|--------|--------|----------------------------------------------------------------------------------------------|

|   | · | we may not be able to meet our liquidity requirements or obtain capital on favorable terms to fund our working capital needs and growth initiatives or to repay or refinance outstanding debt upon maturity; and |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the Company could lose key executive officers. |
|--------|--------|------------------------------------------------|

----

|   | · | owning high-quality, differentiated real estate assets in the better submarkets in our core markets; |
|--------|--------|------------------------------------------------------------------------------------------------------|

|   | · | improving the operating results of our existing properties through concentrated leasing, asset management, cost control and customer service efforts; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | developing and acquiring office properties in in-fill and central business district locations that improve the overall quality of our portfolio and generate attractive returns over the long-term for our stockholders; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | selectively disposing of properties no longer considered to be core holdings primarily due to location, age, quality and overall strategic fit; and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | maintaining a conservative, flexible balance sheet with ample liquidity to meet our funding needs and growth prospects. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

|                                      |   | Six Months EndedJune 30, |    |   |   |
|-------------------------------------------|--------|-------------------------------|---------|--------|--------|
|                                      |   | 2011                          |    | 2010   |   | Change |   |
| Net cash provided by operating activities |   | $                             | 87,595  |   | $      | 100,047 |   | $ | (12,452 | ) |
| Net cash used in investing activities     |   |                          | (78,913 | )      |   | (15,651 | ) |   | (63,262 | ) |
| Net cash used in financing activities     |   |                          | (13,649 | )      |   | (72,252 | ) |   | 58,603 |   |
| Total net cash flows                      |   | $                             | (4,967  | )      | $      | 12,144 |   | $ | (17,111 | ) |

----

|                                                  |   | June 30,2011 |      | December 31,2010 |   |
|-------------------------------------------------------|--------|-------------------|-----------|------------------|--------|
| Mortgages and notes payable, at recorded book value   |   | $                 | 1,615,068 |             | $      | 1,522,945 |   |
| Financing obligations                                 |   | $                 | 32,869    |             | $      | 33,114 |   |
| Preferred Stock, at liquidation value                 |   | $                 | 29,087    |             | $      | 81,592 |   |
|                                                  |   |              |      |             |   |   |   |
| Common Stock outstanding                              |   |              | 72,399    |             |   | 71,690 |   |
| Common Units outstanding (not owned by the Company)   |   |              | 3,775     |             |   | 3,794 |   |
|                                                  |   |              |      |             |   |   |   |
| Per share stock price at period end                   |   | $                 | 33.13     |             | $      | 31.85 |   |
| Market value of Common Stock and Common Units         |   | $                 | 2,523,645 |             | $      | 2,404,165 |   |
| Total market capitalization with debt and obligations |   | $                 | 4,200,669 |             | $      | 4,041,816 |   |

|   | · | cash flow from operating activities; |
|--------|--------|--------------------------------------|

|   | · | borrowings under our credit facilities; |
|--------|--------|-----------------------------------------|

|   | · | the issuance of unsecured debt; |
|--------|--------|---------------------------------|

|   | · | the issuance of secured debt; |
|--------|--------|-------------------------------|

|   | · | the issuance of equity securities by the Company or the Operating Partnership; and |
|--------|--------|------------------------------------------------------------------------------------|

|   | · | the disposition of non-core assets. |
|--------|--------|-------------------------------------|

----

----

----

|   | · | Net income/(loss) computed in accordance with GAAP; |
|--------|--------|-----------------------------------------------------|

|   | · | Less dividends to holders of Preferred Stock and less excess of Preferred Stock redemption cost over carrying value; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------|

|   | · | Less net income attributable to noncontrolling interests in consolidated affiliates; |
|--------|--------|--------------------------------------------------------------------------------------|

|   | · | Plus depreciation and amortization of real estate assets; |
|--------|--------|-----------------------------------------------------------|

|   | · | Less gains, or plus losses, from sales of depreciable operating properties (but excluding impairment losses) and excluding items that are classified as extraordinary items under GAAP; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Plus or minus adjustments for unconsolidated partnerships and joint ventures (to reflect funds from operations on the same basis); and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Plus or minus adjustments for depreciation and amortization and gains/(losses) on sales and noncontrolling interests in consolidated affiliates related to discontinued operations. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                                                                                                                                                                                                                                                      |   | Three Months Ended June 30, |    | Six Months Ended June 30, |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------|---------|--------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                      |   | 2011                             |    | 2010                           |   | 2011 |   | 2010 |   |
|                                                                                                                                                                                                                                                                                                                                                      |   | Amount                           |    | PerShare                       |   | Amount |   | PerShare |   | Amount |   | PerShare |   | Amount |   | PerShare |   |
| Funds from operations:                                                                                                                                                                                                                                                                                                                                    |   |                             |    |                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                                                                                                                                                                                                                                                                                                |   | $                                | 14,434  |                           |   |   |   | $ | 40,049 |   |   |   |   | $ | 26,877 |   |   |   |   | $ | 52,131 |   |   |   |   |
| Net (income) attributable to noncontrolling interests in the Operating Partnership                                                                                                                                                                                                                                                                        |   |                             | (623    | )                              |   |   |   |   | (1,933 | ) |   |   |   |   | (1,130 | ) |   |   |   |   | (2,453 | ) |   |   |   |
| Net (income) attributable to noncontrolling interests in consolidated affiliates                                                                                                                                                                                                                                                                          |   |                             | (182    | )                              |   |   |   |   | (215 | ) |   |   |   |   | (305 | ) |   |   |   |   | (429 | ) |   |   |   |
| Dividends on Preferred Stock                                                                                                                                                                                                                                                                                                                              |   |                             | (1,622  | )                              |   |   |   |   | (1,677 | ) |   |   |   |   | (3,299 | ) |   |   |   |   | (3,354 | ) |   |   |   |
| Excess of Preferred Stock redemption/repurchase cost over carrying value                                                                                                                                                                                                                                                                                  |   |                             | (1,895  | )                              |   |   |   |   | — |   |   |   |   |   | (1,895 | ) |   |   |   |   | — |   |   |   |   |
| Net income available for common stockholders                                                                                                                                                                                                                                                                                                              |   |                             | 10,112  |                           | $      | 0.14 |   |   | 36,224 |   | $ | 0.50 |   |   | 20,248 |   | $ | 0.28 |   |   | 45,895 |   | $ | 0.64 |   |
| Add/(Deduct):                                                                                                                                                                                                                                                                                                                                             |   |                             |    |                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization of real estate assets                                                                                                                                                                                                                                                                                                       |   |                             | 32,971  |                           |   | 0.43 |   |   | 32,833 |   |   | 0.44 |   |   | 66,254 |   |   | 0.87 |   |   | 65,051 |   |   | 0.85 |   |
| (Gains) on disposition of depreciable properties                                                                                                                                                                                                                                                                                                          |   |                             | — |                           |   | — |   |   | (17 | ) |   | — |   |   | — |   |   | — |   |   | (36 | ) |   | — |   |
| (Gains) on disposition of investment in unconsolidated affiliates                                                                                                                                                                                                                                                                                         |   |                             | — |                           |   | — |   |   | (25,330 | ) |   | (0.34 | ) |   | — |   |   | — |   |   | (25,330 | ) |   | (0.33 | ) |
| Net income attributable to noncontrolling interests in the Operating Partnership                                                                                                                                                                                                                                                                          |   |                             | 623     |                           |   | — |   |   | 1,933 |   |   | — |   |   | 1,130 |   |   | — |   |   | 2,453 |   |   | — |   |
| Unconsolidated affiliates:                                                                                                                                                                                                                                                                                                                                |   |                             |    |                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization of real estate assets                                                                                                                                                                                                                                                                                                       |   |                             | 2,033   |                           |   | 0.03 |   |   | 2,737 |   |   | 0.04 |   |   | 4,126 |   |   | 0.06 |   |   | 6,078 |   |   | 0.08 |   |
| Discontinued operations:                                                                                                                                                                                                                                                                                                                                  |   |                             |    |                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization of real estate assets                                                                                                                                                                                                                                                                                                       |   |                             | 32      |                           |   | — |   |   | 275 |   |   | — |   |   | 127 |   |   | — |   |   | 549 |   |   | 0.01 |   |
| (Gains) on disposition of depreciable properties                                                                                                                                                                                                                                                                                                          |   |                             | — |                           |   | — |   |   | — |   |   | — |   |   | — |   |   | — |   |   | (174 | ) |   | — |   |
| Funds from operations                                                       |   | $                                | 45,771  |                           | $      | 0.60 |   | $ | 48,655 |   | $ | 0.64 |   | $ | 91,885 |   | $ | 1.21 |   | $ | 94,486 |   | $ | 1.25 |   |
|                                                                                                                                                                                                                                                                                                                                                      |   |                             |    |                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted average Common Shares outstanding (1)                                                                                                                                                                                                                                                                                                            |   |                             | 76,197  |                           |   |   |   |   | 75,607 |   |   |   |   |   | 75,987 |   |   |   |   |   | 75,504 |   |   |   |   |

| (1) | Includes assumed conversion of all potentially dilutive Common Stock equivalents. |
|-----|-----------------------------------------------------------------------------------|

----

|                                                                                                                                                                           |   | Three Months EndedJune 30, |    | Six Months EndedJune 30, |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                                           |   | 2011                            |    | 2010                          |   | 2011 |   | 2010 |   |
| Income from continuing operations before disposition of property, condominiums and investment in unconsolidated affiliates and equity in earnings of unconsolidated affiliates |   | $                               | 12,474  |                          | $      | 13,413 |   | $ | 23,075 |   | $ | 23,854 |   |
| Other income                                                                                                                                                                   |   |                            | (1,875  | )                             |   | (965 | ) |   | (3,748 | ) |   | (2,665 | ) |
| Interest expense                                                                                                                                                               |   |                            | 23,907  |                          |   | 22,934 |   |   | 47,450 |   |   | 46,047 |   |
| General and administrative expense                                                                                                                                             |   |                            | 7,978   |                          |   | 6,980 |   |   | 15,771 |   |   | 15,487 |   |
| Depreciation and amortization expense                                                                                                                                          |   |                            | 33,430  |                          |   | 33,260 |   |   | 67,147 |   |   | 65,898 |   |
| Net operating income from continuing operations                                                                                                                                |   |                            | 75,914  |                          |   | 75,622 |   |   | 149,695 |   |   | 148,621 |   |
| Less – non same property and other net operating income                                                                                                                  |   |                            | 3,959   |                          |   | 2,656 |   |   | 7,758 |   |   | 4,769 |   |
| Total same property net operating income from continuing operations                                                                                                            |   | $                               | 71,955  |                          | $      | 72,966 |   | $ | 141,937 |   | $ | 143,852 |   |
|                                                                                                                                                                           |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Rental and other revenues                                                                                                                                                      |   | $                               | 117,057 |                          | $      | 113,765 |   | $ | 232,036 |   | $ | 228,268 |   |
| Rental property and other expenses                                                                                                                                             |   |                            | 41,143  |                          |   | 38,143 |   |   | 82,341 |   |   | 79,647 |   |
| Total net operating income from continuing operations                                                                                                                          |   |                            | 75,914  |                          |   | 75,622 |   |   | 149,695 |   |   | 148,621 |   |
| Less – non same property and other net operating income                                                                                                                  |   |                            | 3,959   |                          |   | 2,656 |   |   | 7,758 |   |   | 4,769 |   |
| Total same property net operating income from continuing operations                                                                                                            |   | $                               | 71,955  |                          | $      | 72,966 |   | $ | 141,937 |   | $ | 143,852 |   |
|                                                                                                                                                                           |   |                            |    |                          |   |   |   |   |   |   |   |   |   |
| Total same property net operating income from continuing operations                                                                                                            |   | $                               | 71,955  |                          | $      | 72,966 |   | $ | 141,937 |   | $ | 143,852 |   |
| Less – straight line rent and lease termination fees                                                                                                                     |   |                            | 2,657   |                          |   | 4,676 |   |   | 6,017 |   |   | 6,036 |   |
| Same property cash net operating income from continuing operations                                                                                                             |   | $                               | 69,298  |                          | $      | 68,290 |   | $ | 135,920 |   | $ | 137,816 |   |

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|   | · | the unavailability of favorable construction and/or permanent financing; |
|--------|--------|--------------------------------------------------------------------------|

|   | · | construction costs exceeding original estimates; |
|--------|--------|--------------------------------------------------|

|   | · | construction and lease-up delays resulting in increased debt service expense and construction costs; and |
|--------|--------|----------------------------------------------------------------------------------------------------------|

|   | · | lower than anticipated occupancy rates and rents causing a property to be unprofitable or less profitable than originally estimated. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | the level of institutional interest in us; |
|--------|--------|--------------------------------------------|

|   | · | the perceived attractiveness of investment in us, in comparison to other REITs; |
|--------|--------|---------------------------------------------------------------------------------|

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|   | · | the attractiveness of securities of REITs in comparison to other asset classes taking into account, among other things, that a substantial portion of REITs’ dividends are taxed as ordinary income; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | our financial condition and performance; |
|--------|--------|------------------------------------------|

|   | · | the market’s perception of our growth potential and potential future cash dividends; |
|--------|--------|--------------------------------------------------------------------------------------------|

|   | · | government action or regulation, including changes in tax law; |
|--------|--------|----------------------------------------------------------------|

|   | · | increases in market interest rates, which may lead investors to expect a higher annual yield from our distributions in relation to the price of the Common Stock; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | changes in federal tax laws; |
|--------|--------|------------------------------|

|   | · | changes in our credit ratings; and |
|--------|--------|------------------------------------|

|   | · | any negative change in the level of our dividend. |
|--------|--------|---------------------------------------------------|

|   | · | debt service requirements after taking into account debt covenants and the repayment and restructuring of certain indebtedness and the availability of alternative sources of debt and equity capital and their impact on our ability to refinance existing debt and grow our business; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | scheduled increases in base rents of existing leases; |
|--------|--------|-------------------------------------------------------|

|   | · | changes in rents attributable to the renewal of existing leases or replacement leases; |
|--------|--------|----------------------------------------------------------------------------------------|

|   | · | changes in occupancy rates at existing properties and execution of leases for newly acquired or developed properties; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------|

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

|   | · | anticipated leasing capital expenditures attributable to the renewal of existing leases or replacement leases; |
|--------|--------|----------------------------------------------------------------------------------------------------------------|

|   | · | anticipated building improvements; and |
|--------|--------|----------------------------------------|

|   | · | expected cash flows from financing and investing activities. |
|--------|--------|--------------------------------------------------------------|

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|   | · | Ownership limit. The Company's charter prohibits direct, indirect or constructive ownership by any person or entity of more than 9.8% of our outstanding capital stock. Any attempt to own or transfer shares of capital stock in excess of the ownership limit without the consent of the Company's board of directors will be void. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Preferred Stock. The Company’s charter authorizes the board of directors to issue preferred stock in one or more classes and to establish the preferences and rights of any class of preferred stock issued. These actions can be taken without stockholder approval. The issuance of preferred stock could have the effect of delaying or preventing someone from taking control of the Company, even if a change in control were in our best interest. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Maryland unsolicited takeover statute. Under Maryland law, the Company’s board of directors could adopt various anti-takeover provisions without the consent of stockholders. The adoption of such measures could discourage offers for the Company or make an acquisition of the Company more difficult, even when an acquisition would be in the best interest of the Company’s stockholders. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Anti-takeover protections of operating partnership agreement. Upon a change in control of the Company, the partnership agreement of the Operating Partnership requires certain acquirers to maintain an umbrella partnership real estate investment trust structure with terms at least as favorable to the limited partners as are currently in place. For instance, the acquirer would be required to preserve the limited partner’s right to continue to hold tax-deferred partnership interests that are redeemable for capital stock of the acquirer. Exceptions would require the approval of two-thirds of the limited partners of our operating partnership (other than our company). These provisions may make a change of control transaction involving our company more complicated and therefore might decrease the likelihood of such a transaction occurring, even if such a transaction would be in the best interest of the Company’s stockholders. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| ExhibitNumber | Description                                                                                                                                                                                                         |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|          |                                                                                                                                                                                                                |
| 10.1          | Third Amended and Restated Credit Agreement, dated as of July 27, 2011, by and among the Company, the Operating Partnership and the Subsidiaries named therein and the Lenders named therein              |
|          |                                                                                                                                                                                                                |
| 10.2          | Amendment No. 1, dated as of July 27, 2011, to Credit Agreement, dated as of February 2, 2011, by and among the Company, the Operating Partnership and the Subsidiaries named therein and the Lenders named therein |
|          |                                                                                                                                                                                                                |
| 12.1          | Statement re: Computation of Ratios of the Company                                                                                                                                                                  |
|          |                                                                                                                                                                                                                |
| 12.2          | Statement re: Computation of Ratios of the Operating Partnership                                                                                                                                                    |
|          |                                                                                                                                                                                                                |
| 31.1          | Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley Act for the Company                                                                                                                              |
|          |                                                                                                                                                                                                                |
| 31.2          | Certification of CFO Pursuant to Section 302 of the Sarbanes-Oxley Act for the Company                                                                                                                              |
|          |                                                                                                                                                                                                                |
| 31.3          | Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley Act for the Operating Partnership                                                                                                                |
|          |                                                                                                                                                                                                                |
| 31.4          | Certification of CFO Pursuant to Section 302 of the Sarbanes-Oxley Act for the Operating Partnership                                                                                                                |
|          |                                                                                                                                                                                                                |
| 32.1          | Certification of CEO Pursuant to Section 906 of the Sarbanes-Oxley Act for the Company                                                                                                                              |
|          |                                                                                                                                                                                                                |
| 32.2          | Certification of CFO Pursuant to Section 906 of the Sarbanes-Oxley Act for the Company                                                                                                                              |
|          |                                                                                                                                                                                                                |
| 32.3          | Certification of CEO Pursuant to Section 906 of the Sarbanes-Oxley Act for the Operating Partnership                                                                                                                |
|          |                                                                                                                                                                                                                |
| 32.4          | Certification of CFO Pursuant to Section 906 of the Sarbanes-Oxley Act for the Operating Partnership                                                                                                                |
|          |                                                                                                                                                                                                                |
| 101.INS       | XBRL Instance Document*                                                                                                                                                                                             |
|          |                                                                                                                                                                                                                |
| 101.SCH       | XBRL Taxonomy Extension Schema Document*                                                                                                                                                                            |
|          |                                                                                                                                                                                                                |
| 101.CAL       | XBRL Taxonomy Extension Calculation Linkbase Document*                                                                                                                                                              |
|          |                                                                                                                                                                                                                |
| 101.DEF       | XBRL Taxonomy Extension Definition Linkbase Document*                                                                                                                                                               |
|          |                                                                                                                                                                                                                |
| 101.LAB       | XBRL Extension Labels Linkbase*                                                                                                                                                                                     |
|          |                                                                                                                                                                                                                |
| 101.PRE       | XBRL Taxonomy Extension Presentation Linkbase Document*                                                                                                                                                             |

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|   |   | Highwoods Properties, Inc.  |
|--------|--------|----------------------------------|
|   |   | By:                         |  /s/ Terry L. Stevens |
|   |   |                             | Terry L. Stevens |
|   |   |                             | Senior Vice President and Chief Financial Officer |
|   |   |                             |   |

|   |   | Highwoods Realty Limited Partnership                      |
|--------|--------|----------------------------------------------------------------|
|   |   | By: Highwoods Properties, Inc., its sole general partner  |
|   |   | By:                                                       |  /s/ Terry L. Stevens |
|   |   |                                                           | Terry L. Stevens |
|   |   |                                                           | Senior Vice President and Chief Financial Officer |
|   |   |                                                           |   |

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