Supplemental operating information for the quarter ended June 30, 2008

EX-99.2 3 dex992.htm SUPPLEMENTAL OPERATING INFORMATION FOR THE QUARTER ENDED JUNE 30, 2008 Supplemental operating information for the quarter ended June 30, 2008

Exhibit 99.2

LOGO

Supplemental Information

June 30, 2008

Supplemental Information

Table of Contents

June 30, 2008


Schedule		Page
Summary and Corporate Information		i, ii and iii

Consolidated Statements of Income		1
Statement of Funds from Operations and Additional Information		2
Consolidated Balance Sheets		3
Estimated Net Asset Value		4
Components of Discontinued Operations		5
Capitalization		6
Long-Term Debt Summary		7
Long-Term Debt Detail		8
Portfolio Summary		9, 10 and 11
Occupancy Trends		12
Leasing Statistics		13, 14 and 15
Leasing Statistics by Market		16
Rental Rate Comparisons by Market		17
Lease Expirations		18 and 19
Office Lease Expirations by Market by Quarter		20
Industrial Lease Expirations by Market by Quarter		21
Office Lease Expirations by Market by Year		22
Industrial Lease Expirations by Market by Year		23
Customer Diversification		24
Same Property Performance		25
Disposition Activity		26
Development Activity		27
Development Land		28
Acquisition Activity		29
Unconsolidated Joint Ventures Assets, Debt and Liabilities		30
Unconsolidated Joint Ventures Income (Three Months)		31
Unconsolidated Joint Ventures Income (Six Months)		32
Joint Ventures Long-Term Debt Detail		33
Joint Ventures Portfolio Summary		34
Joint Ventures Lease Expirations		35
Joint Venture Acquisition and Disposition Activity		36

The information within refers to all Highwoods Properties’ wholly-owned entities, except pages 30 to 36, unless noted otherwise. Wholly-owned entities include properties classified as both continuing operations and discontinued operations.

All financial information contained in this document is unaudited. In addition, certain matters discussed in this supplemental, including estimates of net operating income, pre-leasing commitments and the cost, timing and stabilization of announced development projects, are forward-looking statements within the meaning of the federal securities laws. Although Highwoods believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. Factors that could cause actual results to differ materially from Highwoods’ current expectations include general economic conditions, local real estate conditions, the timely development and lease-up of properties, and the other risks listed at the bottom of today’s press release and detailed from time to time in the Company’s SEC reports. Highwoods assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

This supplemental also includes non-GAAP financial measures, such as Funds From Operations (FFO) and net operating income (NOI). Definitions of FFO and NOI and an explanation of management’s view of the usefulness and risks of FFO and NOI can be found toward the end of the second quarter earnings press release.


Highwoods Properties, Inc.				6/30/08

Summary

Amounts in thousands, except per share amounts


	*Three Months Ended*
	06/30/08			03/31/08			12/31/07			09/30/07			06/30/07
Shares and units:

Common shares outstanding at end of period		57,362			57,309			57,167			57,158			57,131
Common units outstanding at end of period		3,933			3,951			4,057			4,059			4,062
Weighted average common shares outstanding - basic		56,940			56,729			56,640			56,628			56,460
Weighted average common shares outstanding - diluted		61,492			61,050			61,347			61,396			61,562

Share price:

At end of period	$	31.42		$	31.07		$	29.38		$	36.67		$	37.50
High close during period		37.38			32.34			38.26			39.01			43.84
Low close during period		31.42			26.67			28.89			32.09			37.50

Financial information:

Land sale gains, net of (impairments)	$	89		$	—		$	(419	)	$	(564	)	$	969
Lease termination income		26			1,900			840			259			1,477
Straight line rental income		1,892			2,404			4,048			908			890
Capitalized interest		2,221			2,585			2,489			2,742			2,365
Impairments on depreciable properties		—			—			—			(384	)		—
Gains on sales of depreciable properties		5,045			3,726			8,623			8,064			1,475

Funds from operations per share - diluted	$	0.69		$	0.71		$	0.65		$	0.59		$	0.58

Funds from operations per share - diluted, excluding certain items 1/	$	0.69		$	0.71		$	0.65		$	0.61		$	0.60

Wholly - owned property information:

In-Service rentable square feet:
Office		19,416			19,565			19,260			19,003			19,194
Industrial		6,299			6,036			6,036			5,942			6,280
Retail		1,343			1,314			1,317			1,318			1,317

Total		27,058			26,915			26,613			26,263			26,791

In-Service occupancy:
Office		90.8	%		90.4	%		91.1	%		89.7	%		88.5	%
Industrial		91.4	%		91.0	%		94.2	%		91.4	%		90.8	%
Retail		93.5	%		92.9	%		94.9	%		94.4	%		94.8	%

Total		91.1	%		90.7	%		92.0	%		90.4	%		89.3	%

1/	Excludes impairments on depreciable assets and preferred stock redemption/repurchase charges.


Highwoods Properties, Inc.		i		6/30/08

Corporate Information

Board of Directors

Thomas W. Adler

Gene H. Anderson

Kay N. Callison

Edward J. Fritsch

Lawrence S. Kaplan

Sherry A. Kellett

L. Glenn Orr Jr.

O. Temple Sloan Jr., Chairman

Corporate Officers

Edward J. Fritsch

President, Chief Executive Officer and Director

Michael E. Harris

Executive Vice President and Chief Operating Officer

Terry L. Stevens

Senior Vice President, Chief Financial Officer

Daniel L. Clemmens

Vice President, Chief Accounting Officer

S. Hugh Esleeck

Treasurer

Peter T. Jardine

Vice President, Corporate Marketing

Carman J. Liuzzo

Vice President, Investments

Art H. McCann

Chief Information Officer

Jeffrey D. Miller

Vice President, General Counsel and Secretary

Kevin E. Penn

Vice President, Strategy

Tabitha N. Zane

Vice President, Investor Relations and Corporate

Communications

Research Coverage

Credit Suisse - North America

Steven Benyik - 212-538-0239

Citigroup Global Markets

Michael Bilerman - 212-816-1383

Deutsche Banc Securities

Lou Taylor - 212-469-4912

Friedman, Billings, Ramsey & Co., Inc.

Wilkes Graham - 703-312-9737

Green Street Advisors

Cedric Lachance - 949-640-8780

RW Baird

Chris Lucas - 703-821-5780

Stifel Nicolaus

John Guinee - 410-454-5520

UBS Securities

Jamie Feldman - 212-713-4932

Wachovia Securities

Chris Haley - 443-263-6773


Highwoods Properties, Inc.		ii		6/30/08

Corporate Information

Divisional Officers

Atlanta/Piedmont Triad

Gene H. Anderson - Senior Vice President

Atlanta, GA

James V. Bacchetta, Vice President

Piedmont Triad, NC

E. F. “Rick” Dehnert, Vice President

Orlando/Tampa

Michael F. Beale - Senior Vice President

Orlando, FL

Michael F. Beale, Senior Vice President

Tampa, FL

Daniel E. Woodward, Vice President

Raleigh

Raleigh, NC

Thomas “Skip” Hill, Vice President

Richmond

Richmond, VA

Paul W. Kreckman, Vice President

Nashville/Memphis/Greenville

W. Brian Reames - Senior Vice President

Nashville, TN and Greenville, SC

W. Brian Reames, Senior Vice President

Memphis, TN

Steven L. Guinn, Vice President

Kansas City

Kansas City, MO

Barrett Brady, Senior Vice President

Glenn E. Stephenson, VP of Retail Operations

Corporate Headquarters

Highwoods Properties, Inc.

3100 Smoketree Court, Suite 600

Raleigh, NC 27604

919-872-4924

Stock Exchange

NYSE Trading Symbol: HIW

Investor Relations Contact

Tabitha Zane

Vice President, Investor Relations and Corporate Communications

Phone: 919-431-1529

Fax: 919-431-1439

E-mail: tabitha.zane@highwoods.com

Information Request

To request a standard Investor Relations package, Annual Report or to be added to our e-mail or fax list, please contact the Corporate Communications/IR Specialist at:

Phone: 919-431-1529

Email: HIW-IR@highwoods.com

The Company

Highwoods Properties, Inc., a member of the S&P MidCap 400 Index, is a fully integrated, self-administered and self-managed equity real estate investment trust (“REIT”) that provides leasing, management, development, construction and other customer-related services for its properties and for third parties. As of June 30, 2008, the Company owned or had an interest in 384 in-service office, industrial and retail properties encompassing approximately 35.0 million square feet. Highwoods also wholly-owned 610 acres of development land. Highwoods is based in Raleigh, North Carolina, and its properties and development land are located in Florida, Georgia, Iowa, Kansas, Maryland, Mississippi, Missouri, North Carolina, South Carolina, Tennessee, and Virginia. For more information about Highwoods Properties, please visit our website at www.highwoods.com.

LOGO


Highwoods Properties, Inc.		iii		6/30/08

Consolidated Statements of Income

Amounts in thousands, except per share amounts


	*Six Months Ended*						*Three Months Ended*
	06/30/08			06/30/07			06/30/08			03/31/08			12/31/07			09/30/07			06/30/07
Rental and other revenues	$	229,947		$	210,608		$	115,853		$	114,094		$	113,803		$	107,580		$	105,146

Operating expenses:
Rental property and other expenses		80,426			75,227			41,572			38,854			40,782			38,682			37,587
Depreciation and amortization		62,250			58,585			31,365			30,885			30,471			31,891			29,756
Impairment of assets held for use		—			—			—			—			—			789			—
General and administrative		20,477			21,779			10,766			9,711			10,142			9,649			10,868

Total operating expenses		163,153			155,591			83,703			79,450			81,395			81,011			78,211

Interest expenses:
Contractual		46,808			45,786			23,345			23,463			24,478			23,728			23,097
Amortization of deferred financing costs		1,324			1,175			686			638			624			616			609
Financing obligations		1,504			1,987			764			740			962			981			995

		49,636			48,948			24,795			24,841			26,064			25,325			24,701

Other income:
Interest and other income		2,406			3,625			1,604			802			1,303			1,469			2,115

		2,406			3,625			1,604			802			1,303			1,469			2,115

Income before disposition of property, insurance gain, minority interest and equity in earnings of unconsolidated affiliates		19,564			9,694			8,959			10,605			7,647			2,713			4,349

Gains on disposition of property, net		107			19,084			107			—			190			1,288			2,341
Gain from property insurance settlement		—			4,128			—			—			—			—			—
Minority interest		(1,500	)		(2,940	)		(679	)		(821	)		(455	)		(262	)		(376	)
Equity in earnings of unconsolidated affiliates		3,509			11,723			1,520			1,989			180			1,207			2,006

Income from continuing operations		21,680			41,689			9,907			11,773			7,562			4,946			8,320
Discontinued operations:
Income from discontinued operations, net of minority interest		761			1,800			374			387			417			846			873
Net gains on sales of discontinued operations, net of minority interest		8,185			18,358			4,702			3,483			7,479			6,175			96
Release of FASB FIN 48 tax liability		—			—			—			—			—			1,473			—

		8,946			20,158			5,076			3,870			7,896			8,494			969

Net income		30,626			61,847			14,983			15,643			15,458			13,440			9,289
Dividends on preferred stock		(5,676	)		(7,959	)		(2,838	)		(2,838	)		(2,838	)		(2,680	)		(3,846	)
Excess of preferred stock redemption cost over carrying value		—			(1,443	)		—			—			—			(842	)		(1,443	)

Net income available for common stockholders	$	24,950		$	52,445		$	12,145		$	12,805		$	12,620		$	9,918		$	4,000

Net income per common share - diluted:
Income from continuing operations	$	0.28		$	0.57		$	0.12		$	0.15		$	0.08		$	0.02		$	0.05
Income from discontinued operations		0.16			0.35			0.09			0.07			0.14			0.15			0.02

Net income	$	0.44		$	0.92		$	0.21		$	0.22		$	0.22		$	0.17		$	0.07

Weighted average common shares outstanding - diluted		61,290			61,709			61,492			61,050			61,347			61,396			61,562

Dividends declared and paid per common share	$	0.850		$	0.850		$	0.425		$	0.425		$	0.425		$	0.425		$	0.425


Highwoods Properties, Inc.		1		6/30/08

Statement of Funds from Operations

and Additional Information

Amounts in thousands, except per share amounts


	*Six Months Ended*						*Three Months Ended*
	06/30/08			06/30/07			06/30/08			03/31/08			12/31/07			09/30/07			06/30/07
Funds from operations:
Net income	$	30,626		$	61,847		$	14,983		$	15,643		$	15,458		$	13,440		$	9,289
Dividends to preferred stockholders		(5,676	)		(7,959	)		(2,838	)		(2,838	)		(2,838	)		(2,680	)		(3,846	)
Excess of preferred stock redemption cost over carrying value		—			(1,443	)		—			—			—			(842	)		(1,443	)

Net income available for common stockholders		24,950			52,445			12,145			12,805			12,620			9,918			4,000
Add/(deduct):
Depreciation and amortization of real estate assets		61,248			57,340			30,920			30,328			29,895			31,294			29,148
(Gains) on disposition of depreciable properties		(18	)		(2,280	)		(18	)		—			(609	)		(1,063	)		(1,372	)
Minority interest from the Operating Partnership in income from continuing operations		1,111			2,592			488			623			294			92			208
Unconsolidated affiliates:
Depreciation and amortization of real estate assets		6,330			5,744			3,395			2,935			4,587			3,107			2,878
(Gains) on disposition of depreciable properties		—			(7,158	)		—			—			—			—			—
Discontinued operations:
Depreciation and amortization of real estate assets		233			1,708			9			224			436			773			791
(Gains) on disposition of depreciable properties		(8,753	)		(19,846	)		(5,027	)		(3,726	)		(8,014	)		(7,001	)		(103	)
Release of FASB FIN 48 tax liability		—			—			—			—			—			(1,473	)		—
Minority interest in income from discontinued operations		621			1,625			351			270			566			502			70

Funds from operations	$	85,722		$	92,170		$	42,263		$	43,459		$	39,775		$	36,149		$	35,620

Funds from operations per share - diluted
Net income available for common stockholders	$	0.44		$	0.92		$	0.21		$	0.22		$	0.22		$	0.17		$	0.07
Add/(deduct):
Depreciation and amortization of real estate assets		1.00			0.93			0.50			0.50			0.49			0.51			0.47
(Gains) on disposition of depreciable properties		—			(0.04	)		—			—			(0.01	)		(0.02	)		(0.02	)
Unconsolidated affiliates:
Depreciation and amortization of real estate assets		0.10			0.09			0.06			0.05			0.07			0.05			0.05
(Gains) on disposition of depreciable properties		—			(0.12	)		—			—			—			—			—
Discontinued operations:
Depreciation and amortization of real estate assets		—			0.03			—			—			0.01			0.01			0.01
(Gains) on disposition of depreciable properties		(0.14	)		(0.32	)		(0.08	)		(0.06	)		(0.13	)		(0.11	)		—
Release of FASB FIN 48 tax liability		—			—			—			—			—			(0.02	)		—

Funds from operations	$	1.40		$	1.49		$	0.69		$	0.71		$	0.65		$	0.59		$	0.58

Weighted average shares outstanding - diluted		61,290			61,709			61,492			61,050			61,347			61,396			61,562

Additional information: 1/
Funds from operations, excluding certain items 2/	$	85,722		$	93,613		$	42,263		$	43,459		$	39,775		$	37,375		$	37,063

Funds from operations per share, excluding certain items 2/	$	1.40		$	1.52		$	0.69		$	0.71		$	0.65		$	0.61		$	0.60

Straight line rental income	$	(4,296	)
Amortization of lease incentives		486
Depreciation of non-real estate assets		698
Ground lease straight line rent		85
Amortization of stock-based compensation		3,940
Amortization of deferred financing costs		1,324
Amortization of accumulated other comprehensive loss		126
Harborview non-cash FMV charge		(70	)

Non-incremental revenue generating capital expenditures paid: 3/
Building improvements		(5,641	)
2nd generation tenant improvements		(14,552	)
2nd generation lease commissions		(6,427	)
Common dividends and unit distributions paid		(52,009	)

1/	Increase or (decrease) to cash flows.

2/	Excludes impairments on depreciable assets and preferred stock redemption/repurchase charges.

3/	Excludes capital expenditures paid for buildings sold prior to June 30, 2008.


Highwoods Properties, Inc.		2		6/30/08

Consolidated Balance Sheets

Dollars in thousands


	06/30/08			12/31/07
Assets:
Real estate assets, at cost:
Land	$	356,447		$	356,600
Buildings and tenant improvements		2,745,462			2,703,983
Development in process		122,381			101,661
Land held for development		98,134			103,365

		3,322,424			3,265,609
Less-accumulated depreciation		(680,310	)		(648,142	)

Net real estate assets		2,642,114			2,617,467
Real estate and other assets, net, held for sale		13,242			15,150
Cash and cash equivalents		4,033			3,140
Restricted cash		28,941			15,896
Accounts receivable, net		32,121			23,521
Notes receivable, net		3,750			5,226
Accrued straight-line rents receivable, net		78,542			74,427
Investment in unconsolidated affiliates		68,877			58,046
Deferred financing and leasing costs, net		73,682			72,128
Prepaid expenses and other assets		43,604			41,954

Total Assets	$	2,988,906		$	2,926,955

Liabilities, Minority Interest and Stockholders’ Equity:
Mortgages and notes payable	$	1,732,082		$	1,641,987
Accounts payable, accrued expenses and other liabilities		147,287			157,766
Financing obligations		35,145			35,071

Total Liabilities		1,914,514			1,834,824
Minority interest		67,389			70,098
Stockholders’ Equity:
Preferred stock		135,437			135,437
Common stock		576			572
Additional paid-in capital		1,456,448			1,448,055
Distributions in excess of net earnings		(584,796	)		(561,093	)
Accumulated other comprehensive loss		(662	)		(938	)

Total Stockholders’ Equity		1,007,003			1,022,033

Total Liabilities, Minority Interest and Stockholders’ Equity	$	2,988,906		$	2,926,955


Highwoods Properties, Inc.		3		6/30/08

Estimated Net Asset Value Ranges

As Released on February 12, 2008 — See Note Below

Dollars in thousands, except per share amounts

Note: The following table sets forth information that was reported in our Supplemental issued February 12, 2008 and has not been updated to reflect facts or circumstances or changes in financial and operating assumptions that may have occurred subsequent to such date. This information is based on a range of estimated capitalization rates and projected net operating income, among other things, and is not intended to be an asset-by-asset or enterprise valuation.


NOI Cap Rates:
Office		7.00	%		7.25	%		7.50	%
Retail		5.50	%		5.75	%		6.00	%
Industrial/Other		7.25	%		7.50	%		7.75	%

Consolidated Properties Projected 2008 Net Operating Income 1/ 3/
Office	$	220,168		$	220,168		$	220,168
Retail		29,634			29,634			29,634
Industrial/Other		22,176			22,176			22,176

Total	$	271,978		$	271,978		$	271,978

Consolidated Properties Capitalized Value
Office	$	3,145,257		$	3,036,800		$	2,935,573
Retail		538,800			515,374			493,900
Industrial/Other		305,876			295,680			286,142

Total	$	3,989,933		$	3,847,854		$	3,715,615

Highwoods’ Share of Unconsolidated Joint Ventures
Projected 2008 net operating income	$	30,584		$	30,584		$	30,584
Capitalization rates		7.00	%		7.25	%		7.50	%

Capitalized value	$	436,914		$	421,848		$	407,787

Total In-Service Property Value	$	4,426,847		$	4,269,702		$	4,123,402

Value of Other income
Development, leasing and management fees	$	4,773		$	4,773		$	4,773
Capitalization rate		20	%		20	%		20	%

Value of other income	$	23,867		$	23,867		$	23,867

Add Other assets:
Development pipeline investment at 135% of cost 2/	$	249,230		$	249,230		$	249,230
Assets not fairly valued by capitalized NOI valuation method 3/		204,698			204,698			204,698
Property held for sale at net sales price		10,674			10,674			10,674
Land held for development at market value		138,013			138,013			138,013
Cash and cash equivalents		3,140			3,140			3,140
Restricted cash		15,896			15,896			15,896
Accounts receivable, net		23,521			23,521			23,521
Notes receivable and prepaid expenses		47,180			47,180			47,180

Total	$	692,352		$	692,352		$	692,352

Gross Value of Assets	$	5,143,066		$	4,985,920		$	4,839,620

Deductions:
Total liabilities	$	155,779		$	155,779		$	155,779
Mortgages and notes payable		1,641,987			1,641,987			1,641,987
Market value of debt adjustment		(9,065	)		(9,065	)		(9,065	)
Minority interest adjustment 4/		41,280			41,280			41,280
Preferred stock, at liquidation value		135,437			135,437			135,437
Highwoods’ share of unconsolidated joint ventures liabilities		246,814			246,814			246,814

Estimated Net Asset Value	$	2,930,834		$	2,773,689		$	2,627,388

Estimated diluted common shares and common units for 2008		61,425			61,425			61,425

Estimated Net Asset Value Per Share	$	47.71		$	45.16		$	42.77

1/	NOI excludes straight line income, lease termination fee income, NOI related to completed not stablilized developments, and NOI related to assets undervalued by capitalized NOI method.

2/	Represents average increase in value based on projected development yields on cost compared to projected market valuations.

3/	Consolidated Properties NOI is adjusted to eliminate the net NOI for properties for which a NOI capitalization approach is not appropriate. For these assets, an alternative methodology has been applied.

4/	Represents adjustment to reflect the minority interest in the fair value of our consolidated joint ventures.


Highwoods Properties, Inc.		4		6/30/08

Components of Discontinued Operations

Dollars in thousands


	*Six Months Ended*						*Three Months Ended*
	06/30/08			06/30/07			06/30/08			03/31/08			12/31/07			09/30/07			06/30/07
Rental and other revenues	$	1,866		$	6,862		$	674		$	1,192		$	2,005		$	3,285		$	3,340

Operating expenses:
Rental property and other expenses		822			3,236			266			556			1,143			1,610			1,617
Depreciation and amortization		233			1,708			9			224			436			773			791
General and administrative		—			—			—			—			—			—			—

Total operating expenses		1,055			4,944			275			780			1,579			2,383			2,408
Other income		3			19			1			2			22			4			4

Income before minority interest and gains on sales of discontinued operations		814			1,937			400			414			448			906			936
Minority interest in discontinued operations		(53	)		(137	)		(26	)		(27	)		(31	)		(60	)		(63	)

Income from discontinued operations before gains on sales of discontinued operations		761			1,800			374			387			417			846			873
Net gains on sales of discontinued operations		8,753			19,846			5,027			3,726			8,014			6,617			103
Minority interest in discontinued operations		(568	)		(1,488	)		(325	)		(243	)		(535	)		(442	)		(7	)

Net gains on sales of discontinued operations, net of minority interest		8,185			18,358			4,702			3,483			7,479			6,175			96
Net income from discontinued operations before release of FASB FIN 48 tax liability		8,946			20,158			5,076			3,870			7,896			7,021			969
Release of FASB FIN 48 tax liability		—			—			—			—			—			1,473			—

Net income from discontinued operations	$	8,946		$	20,158		$	5,076		$	3,870		$	7,896		$	8,494		$	969


Highwoods Properties, Inc.		5		6/30/08

Capitalization

Dollars, shares, and units in thousands


	6/30/08		3/31/08		12/31/07		9/30/07		6/30/07
Long-Term Debt (see pages 7 & 8):	$	1,732,082	$	1,703,238	$	1,641,987	$	1,601,474	$	1,557,571

Financing Obligations:	$	35,145	$	35,296	$	35,071	$	34,919	$	35,683

Preferred Stock (at liquidation value):
Series A 8 ⁵/8% Perpetual Preferred Stock	$	82,937	$	82,937	$	82,937	$	82,937	$	104,945
Series B 8% Perpetual Preferred Stock		52,500		52,500		52,500		52,500		52,500

Total preferred stock	$	135,437	$	135,437	$	135,437	$	135,437	$	157,445

Common Shares and Units Outstanding:
Common stock outstanding		57,632		57,309		57,167		57,158		57,131
Minority interest partnership units		3,933		3,951		4,057		4,059		4,062

Total common shares and units outstanding		61,565		61,260		61,224		61,217		61,193

Stock price at period end	$	31.42	$	31.07	$	29.38	$	36.67	$	37.50

Market value of common equity	$	1,934,372	$	1,903,348	$	1,798,761	$	2,244,827	$	2,294,738

Total market capitalization with debt and obligations	$	3,837,036	$	3,777,319	$	3,611,256	$	4,016,657	$	4,045,437

See pages 30 to 36 for information regarding Highwoods’ Joint Ventures.


Highwoods Properties, Inc.		6		6/30/08

Long-Term Debt Summary

Dollars in thousands


	6/30/08			3/31/08			12/31/07			9/30/07			6/30/07
Balances Outstanding:

Secured:
Conventional fixed rate 1/	$	640,557		$	643,041		$	645,500		$	657,408		$	659,741
Variable rate debt		47,087			26,890			19,811			11,920			1,014

Secured total		687,644			669,931			665,311			669,328			660,755

Unsecured:
Fixed rate bonds and notes		648,938			648,907			748,876			748,846			748,816
Bank term loan		137,500			137,500			—			—			—
Credit facility		258,000			246,900			227,800			183,300			148,000

Unsecured total		1,044,438			1,033,307			976,676			932,146			896,816

Total	$	1,732,082		$	1,703,238		$	1,641,987		$	1,601,474		$	1,557,571


End of Period Weighted Average Interest Rates:

Secured:
Conventional fixed rate		6.61	%		6.62	%		6.62	%		6.63	%		6.63	%
Variable rate debt		4.01	%		4.34	%		6.61	%		7.02	%		7.11	%

Secured total		6.44	%		6.50	%		6.62	%		6.64	%		6.63	%

Unsecured:
Fixed rate bonds		6.53	%		6.53	%		6.61	%		6.61	%		6.61	%
Bank term loan		3.53	%		3.71	%		—			—			—
Credit facility		3.43	%		3.65	%		5.80	%		6.32	%		6.12	%

Unsecured total		5.37	%		5.47	%		6.42	%		6.56	%		6.53	%

Average		5.79	%		5.88	%		6.50	%		6.59	%		6.57	%

Maturity Schedule:


	*Future Maturities of Debt*				Total Debt 2/		Average Interest Rate
Year	Secured Debt 2/		Unsecured Debt		Total Debt 2/		Average Interest Rate
2008	$	—	$	—	$	—	—
2009		140,014		308,000		448,014	5.20	%
2010		32,563		—		32,563	4.08	%
2011		—		137,500		137,500	3.53	%
2012		212,523		—		212,523	6.95	%
2013		265,527		—		265,527	5.90	%
2014		37,017		—		37,017	5.79	%
2015		—		—		—	—
2016		—		—		—	—
2017		—		398,938		398,938	5.85	%
2018		—		200,000		200,000	7.50	%

Total maturities	$	687,644	$	1,044,438	$	1,732,082	5.79	%

Weighted average maturity = 5.0 years

1/	Includes a $22.5 million loan related to a consolidated 20% owned joint venture (Harborview) and $37.0 million in loans at June 30, 2008 related to a consolidated 50% joint venture (Markel).

2/	All periods exclude annual principal amortization.


Highwoods Properties, Inc.		7		6/30/08

Long-Term Debt Detail

Dollars in thousands

Secured Loans


Lender	Rate		Maturity Date	Loan Balance 6/30/08		Undepreciated Book Value of Assets Secured
Lender	Rate		Maturity Date	Loan Balance 6/30/08		Undepreciated Book Value of Assets Secured
Northwestern Mutual	7.05	%	Jan-12	$	190,000	$	299,896
Northwestern Mutual	6.03	%	Mar-13		134,435		183,149
Massachusetts Mutual Life Ins. Co. 1/	5.68	%	Dec-13		119,770		214,602
Monumental Life Ins. Co. 2/	7.77	%	Nov-09		79,235		199,099
Monumental Life Ins. Co. 2/	7.87	%	Nov-09		40,728
Metropolitan Life Ins. Co. 3/	6.06	%	Oct-12		22,523		39,066
Wells Fargo 4/ 5/	4.24	%	May-10		17,476		20,552
Royal Bank of Canada 4/	3.86	%	Dec-09		14,524		32,803
Principal Life Insurance Company 6/	5.79	%	Jan-14		11,348		14,402
Principal Life Insurance Company 6/	5.79	%	Jan-14		11,348		18,781
Massachusetts Mutual Life Ins. Co. 1/	6.48	%	Dec-13		10,607
Wells Fargo 4/	4.14	%	May-10		10,395		12,790
Principal Life Insurance Company 6/	5.74	%	Jan-14		8,948		14,131
Principal Life Insurance Company 6/	5.89	%	Jan-14		5,374		7,514
PNC/Regions/Union Bank of California/U.S. Bank 4/	3.34	%	Dec-10		4,692		5,606
Lutheran Brotherhood	6.75	%	Apr-09		3,623		7,897
Security Life of Denver	8.85	%	Aug-09		1,903		9,485
American United Life	9.00	%	Jun-13		715		3,344

	6.44	%			687,644	$	1,083,117


Unsecured Bonds
Bonds	5.85	%	Mar-17		398,938
Bonds	7.50	%	Apr-18		200,000
Bonds	8.13	%	Jan-09		50,000

	6.53	%			648,938


Unsecured Loans
Credit facility 4/ 7/	3.43	%	May-09		258,000
Bank term loan 4/	3.53	%	Feb-11		137,500

	3.46	%			395,500

Total Debt	5.79	%		$	1,732,082

1/	These two loans are secured by the same assets.

2/	These two loans are secured by the same assets.

3/	Loan relates to a consolidated 20% owned joint venture (Harborview).

4/	Floating rate loans based on one month libor.

5/	This loan was paid off on 7/18/2008.

6/	Loans relate to a consolidated 50% owned joint venture (Markel).

7/	Maturity date excludes one-year extension option.


Highwoods Properties, Inc.		8		6/30/08

Portfolio Summary - Wholly-Owned Properties Only 1/

(Rentable Square Feet)


Office Industrial & Retail	6/30/08		3/31/08		12/31/07		9/30/07		6/30/07
In-Service:
Office 2/	19,416,000		19,565,000		19,260,000		19,003,000		19,194,000
Industrial	6,299,000		6,036,000		6,036,000		5,942,000		6,280,000
Retail 3/	1,343,000		1,314,000		1,317,000		1,318,000		1,317,000

Total 4/	27,058,000		26,915,000		26,613,000		26,263,000		26,791,000

Development Completed - Not Stabilized:
Office 2/	428,000		524,000		607,000		867,000		560,000
Industrial	418,000		681,000		681,000		681,000		681,000
Retail	—		—		—		—		—

Total	846,000		1,205,000		1,288,000		1,548,000		1,241,000

Development - In Process:
Office 2/	803,000		717,000		887,000		1,233,000		1,387,000
Industrial	200,000		200,000		—		120,000		120,000
Retail	—		—		30,000		30,000		—

Total	1,003,000		917,000		917,000		1,383,000		1,507,000

Total:
Office 2/	20,647,000		20,806,000		20,754,000		21,103,000		21,141,000
Industrial	6,917,000		6,917,000		6,717,000		6,743,000		7,081,000
Retail 3/	1,343,000		1,314,000		1,347,000		1,348,000		1,317,000

Total 4/	28,907,000		29,037,000		28,818,000		29,194,000		29,539,000

Same Property
Office 2/	18,224,000		18,224,000		18,224,000		18,224,000		18,224,000
Industrial	5,916,000		5,916,000		5,916,000		5,916,000		5,916,000
Retail	1,313,000		1,313,000		1,313,000		1,313,000		1,313,000

Total	25,453,000		25,453,000		25,453,000		25,453,000		25,453,000




Percent Leased/Pre-Leased:
In-Service:
Office	90.8	%	90.4	%	91.1	%	89.7	%	88.5	%
Industrial	91.4	%	91.0	%	94.2	%	91.4	%	90.8	%
Retail	93.5	%	92.9	%	94.9	%	94.4	%	94.8	%

Total	91.1	%	90.7	%	92.0	%	90.4	%	89.3	%

Development Completed - Not Stabilized:
Office	73.6	%	67.4	%	75.9	%	75.9	%	69.9	%
Industrial	72.0	%	78.2	%	78.2	%	78.2	%	61.0	%
Retail	—		—		—		—		—

Total	72.8	%	73.5	%	77.1	%	76.9	%	65.0	%

Development - In Process:
Office	63.5	%	65.7	%	59.9	%	71.2	%	72.5	%
Industrial	50.0	%	50.0	%	—		100.0	%	0.0	%
Retail	—		—		100.0	%	100.0	%	—

Total	60.8	%	62.3	%	61.2	%	74.3	%	66.7	%

Same Property
Office	90.8	%	90.5	%	91.2	%	90.2	%	89.2	%
Industrial	91.4	%	90.9	%	94.1	%	91.4	%	91.7	%
Retail	93.4	%	92.9	%	95.2	%	94.7	%	95.1	%

Total	91.0	%	90.7	%	92.1	%	90.7	%	90.1	%

1/	Excludes properties recorded on our Balance Sheet that relate to 50% or less owned joint ventures properties that are consolidated under GAAP.

2/	Substantially all of our Office properties are located in suburban markets.

3/	Excludes 428,000 square feet of basement space in the Country Club Plaza and other Kansas City Retail properties.

4/	Excludes minor for rent apartment buildings.


Highwoods Properties, Inc.		9		6/30/08

Portfolio Summary

(Continued)

As of June 30, 2008


Summary by Location, Wholly-Owned Properties Only 1/:

	Rentable				Percentage of Annualized Cash Revenue 2/
	Rentable
Market	Square Feet		Occupancy		Office		Industrial		Retail		Total
Raleigh 3/	3,711,000		89.7	%	15.5	%	—		—		15.5	%
Nashville	3,181,000		94.9	%	14.5	%	—		—		14.5	%
Atlanta	5,552,000		92.0	%	10.0	%	3.9	%	—		13.9	%
Tampa	2,419,000		94.5	%	13.8	%	—		—		13.8	%
Kansas City	1,956,000	4/	91.3	%	3.5	%	0.0	%	9.1	%	12.6	%
Piedmont Triad 5/	5,358,000		85.9	%	6.2	%	3.7	%	0.1	%	10.0	%
Richmond	2,230,000		92.1	%	8.9	%	—		—		8.9	%
Memphis	1,337,000		93.5	%	5.6	%	—		—		5.6	%
Greenville	897,000		91.4	%	3.2	%	—		—		3.2	%
Orlando	317,000		98.4	%	1.5	%	—		—		1.5	%
Other	100,000		84.3	%	0.5	%	—		—		0.5	%

Total	27,058,000		91.1	%	83.2	%	7.6	%	9.2	%	100.0	%




Summary by Location, Including Joint Venture Properties:

Market	Rentable		Occupancy		Percentage of Annualized Cash Revenue 2/ 6/
Market	Square Feet		Occupancy		Office		Industrial		Retail		Multi-Family		Total
Raleigh	4,525,000		89.5	%	14.5	%	—		—		—		14.5	%
Atlanta	6,387,000		92.3	%	10.2	%	3.4	%	—		—		13.6	%
Nashville	3,181,000		94.9	%	12.9	%	—		—		—		12.9	%
Tampa	2,624,000		94.8	%	12.4	%	—		—		—		12.4	%
Kansas City	2,670,000	4/	89.0	%	4.0	%	0.0	%	8.1	%	—		12.1	%
Piedmont Triad	5,722,000		85.0	%	5.8	%	3.2	%	0.1	%	—		9.1	%
Richmond	2,643,000		93.3	%	8.4	%	—		—		—		8.4	%
Memphis	1,337,000		93.5	%	4.9	%	—		—		—		4.9	%
Orlando	2,171,000		91.0	%	4.5	%	—		—		—		4.5	%
Des Moines	2,505,000		88.5	%	3.2	%	0.5	%	0.1	%	0.4	%	4.2	%
Greenville	897,000		91.4	%	2.8	%	—		—		—		2.8	%
Other	210,000		92.5	%	0.5	%	—		—		—		0.5	%
Charlotte	148,000		100.0	%	0.1	%	—		—		—		0.1	%

Total	35,020,000		90.7	%	84.2	%	7.1	%	8.3	%	0.4	%	100.0	%

1/	Excludes properties recorded on our Balance Sheet that relate to 50% or less owned joint ventures properties that are consolidated under GAAP.

2/	Annualized Cash Revenue is June, 2008 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line rental income) multiplied by 12.

3/	Raleigh Market encompasses Raleigh, Durham, Cary, and Research Triangle metropolitan area.

4/	Excludes 428,000 square feet of basement space in the Country Club Plaza and other Kansas City Retail properties.

5/	Piedmont Triad Market encompasses Greensboro, Winston-Salem metropolitan area.

6/	Includes Highwoods’ share of Joint Venture Annualized Cash Revenue, see page 34.


Highwoods Properties, Inc.		10		6/30/08

Portfolio Summary - Wholly-Owned Properties Only

(Continued)

As of June 30, 2008


	Office Properties 1/					Industrial
Market	Rentable Square Feet	Occupancy		Percentage of Office Annualized Cash Revenue 2/		Rentable Square Feet	Occupancy		Percentage of Industrial Annualized Cash Revenue 2/
Raleigh	3,711,000	89.7	%	18.6	%	—	—		—
Nashville	3,181,000	94.9	%	17.4	%	—	—		—
Tampa	2,419,000	94.5	%	16.6	%	—	—		—
Atlanta	2,470,000	89.9	%	12.0	%	3,082,000	93.6	%	51.3	%
Richmond	2,230,000	92.1	%	10.7	%	—	—		—
Piedmont Triad	2,115,000	80.4	%	7.5	%	3,213,000	89.4	%	48.6	%
Memphis	1,337,000	93.5	%	6.7	%	—	—		—
Kansas City	639,000	87.2	%	4.2	%	4,000	46.5	%	0.1	%
Greenville	897,000	91.4	%	3.8	%	—	—		—
Orlando	317,000	98.4	%	1.8	%	—	—		—
Other	100,000	84.3	%	0.7	%	—	—		—

	19,416,000	90.8	%	100.0	%	6,299,000	91.4	%	100.0	%


	Retail
Market	Rentable Square Feet	Occupancy		Percentage of Retail Annualized Cash Revenue 2/
Kansas City 3/	1,313,000	93.4	%	98.8	%
Piedmont Triad	30,000	100.0	%	1.2	%

	1,343,000	93.5	%	100.0	%

1/	Excludes properties recorded on our Balance Sheet that relate to 50% or less owned joint ventures properties that are consolidated under GAAP.

2/	Annualized Cash Revenue is June, 2008 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line rental income) multiplied by 12.

3/	Excludes 428,000 square feet of basement space in the Country Club Plaza and other Kansas City Retail properties.


Highwoods Properties, Inc.		11		6/30/08

Occupancy Trends - Office, Industrial and Retail Properties 1/


Market	Measurement	6/30/08		3/31/08		12/31/07		9/30/07		6/30/07
Atlanta	Rentable Square Feet	5,552,000		5,289,000		5,289,000		5,199,000		5,514,000
	Occupancy	92.0	%	91.6	%	93.0	%	92.8	%	92.9	%
	Current Properties 2/	92.1	%	91.5	%	92.9	%	92.8	%	92.7	%

Columbia	Rentable Square Feet	—		—		—		253,000		253,000
	Occupancy	—		—		—		82.5	%	72.0	%
	Current Properties 2/	—		—		—		82.5	%	72.0	%

Greenville	Rentable Square Feet	897,000		897,000		897,000		897,000		1,109,000
	Occupancy	91.4	%	86.4	%	85.6	%	87.7	%	76.3	%
	Current Properties 2/	91.4	%	86.4	%	85.6	%	87.6	%	83.9	%

Kansas City 3/	Rentable Square Feet	1,956,000		2,229,000		2,215,000		2,216,000		2,215,000
	Occupancy	91.3	%	88.8	%	89.4	%	89.3	%	89.5	%
	Current Properties 2/	91.4	%	90.9	%	91.9	%	91.9	%	92.3	%

Memphis	Rentable Square Feet	1,337,000		1,276,000		1,276,000		1,276,000		1,276,000
	Occupancy	93.5	%	93.8	%	94.9	%	92.5	%	92.7	%
	Current Properties 2/	93.2	%	93.8	%	94.9	%	92.5	%	92.7	%

Nashville	Rentable Square Feet	3,181,000		3,184,000		3,184,000		2,875,000		2,875,000
	Occupancy	94.9	%	95.0	%	95.1	%	92.5	%	90.9	%
	Current Properties 2/	94.2	%	94.4	%	94.7	%	92.4	%	90.6	%

Orlando	Rentable Square Feet	317,000		317,000		218,000		218,000		218,000
	Occupancy	98.4	%	96.9	%	100.0	%	99.4	%	98.9	%
	Current Properties 2/	97.6	%	95.4	%	100.0	%	99.4	%	98.9	%

Piedmont Triad	Rentable Square Feet	5,358,000		5,358,000		5,328,000		5,234,000		5,235,000
	Occupancy	85.9	%	85.2	%	89.3	%	86.1	%	85.7	%
	Current Properties 2/	85.5	%	84.8	%	89.1	%	86.0	%	85.7	%

Raleigh	Rentable Square Feet	3,711,000		3,712,000		3,554,000		3,553,000		3,554,000
	Occupancy	89.7	%	90.3	%	91.5	%	88.1	%	86.5	%
	Current Properties 2/	90.1	%	90.8	%	91.5	%	88.1	%	86.5	%

Richmond	Rentable Square Feet	2,230,000		2,135,000		2,134,000		2,024,000		2,024,000
	Occupancy	92.1	%	93.5	%	92.5	%	91.8	%	90.0	%
	Current Properties 2/	93.2	%	93.4	%	92.3	%	91.6	%	89.9	%

Tampa	Rentable Square Feet	2,419,000		2,418,000		2,418,000		2,418,000		2,418,000
	Occupancy	94.5	%	94.7	%	95.0	%	95.6	%	96.5	%
	Current Properties 2/	94.5	%	94.7	%	94.9	%	95.5	%	96.4	%

Total 4/	Rentable Square Feet	26,958,000		26,815,000		26,513,000		26,163,000		26,691,000
	Occupancy	91.1	%	90.7	%	92.0	%	90.4	%	89.3	%

	Current Properties 2/	91.0	%	90.6	%	92.0	%	90.6	%	90.0	%

1/	Excludes properties recorded on our Balance Sheet that relate to 50% or less owned joint ventures properties that are consolidated under GAAP.

2/	Only includes properties that were owned and in-service for all periods shown.

3/	Excludes 428,000 square feet of basement space in the Country Club Plaza and other Kansas City Retail properties.

4/	Excludes a 100,000 square foot building located in South Florida.


Highwoods Properties, Inc.		12		6/30/08

Leasing Statistics

Office Portfolio 1/


	Three Months Ended
	6/30/08 2/			3/31/08 3/			12/31/07 4/			9/30/07 5/			6/30/07 6/			Average
Net Effective Rents Related to Re-leased Space:
Number of lease transactions (signed leases)		113			126			126			121			166			130
Rentable square footage leased		997,600			602,049			920,405			1,125,050			865,958			902,212
Square footage of Renewal Deals		913,530			385,756			730,702			720,127			590,542			668,131
Renewed square footage (% of total)		91.6	%		64.1	%		79.4	%		64.0	%		68.2	%		74.1	%
New Leases square footage (% of total)		8.4	%		35.9	%		20.6	%		36.0	%		31.8	%		25.9	%

Weighted average per rentable square foot over the lease term:
Base rent	$	22.47		$	19.82		$	19.35		$	19.32		$	20.13		$	20.22
Tenant improvements		(1.16	)		(1.10	)		(1.64	)		(0.93	)		(2.00	)		(1.37	)
Leasing commissions 7/		(0.63	)		(0.44	)		(0.62	)		(0.51	)		(0.63	)		(0.57	)
Rent concessions		(0.28	)		(0.13	)		(0.19	)		(0.40	)		(0.21	)		(0.24	)

Effective rent		20.40			18.15			16.90			17.48			17.29			18.04
Expense stop		(7.12	)		(5.90	)		(6.05	)		(6.31	)		(6.04	)		(6.28	)

Equivalent effective net rent	$	13.28		$	12.25		$	10.85		$	11.17		$	11.25		$	11.76

Weighted average term in years		3.2			4.0			4.4			4.6			4.5			4.1


Capital Expenditures Related to Re-leased Space:
Tenant Improvements:
Total dollars committed under signed leases	$	5,224,995		$	3,504,078		$	7,696,269		$	6,513,821		$	8,589,754		$	6,305,783
Rentable square feet		997,600			602,049			920,405			1,125,050			865,958			902,212

Per rentable square foot	$	5.24		$	5.82		$	8.36		$	5.79		$	9.92		$	6.99

Leasing Commissions:
Total dollars committed under signed leases 7/	$	2,300,840		$	1,190,054		$	2,719,401		$	2,747,213		$	2,303,936		$	2,252,289
Rentable square feet		997,600			602,049			920,405			1,125,050			865,958			902,212

Per rentable square foot	$	2.31		$	1.98		$	2.95		$	2.44		$	2.66		$	2.50

Total:
Total dollars committed under signed leases	$	7,525,835		$	4,694,132		$	10,415,670		$	9,261,034		$	10,893,690		$	8,558,072
Rentable square feet		997,600			602,049			920,405			1,125,050			865,958			902,212

Per rentable square foot	$	7.54		$	7.80		$	11.32		$	8.23		$	12.58		$	9.49

1/	Excludes properties recorded on our Balance Sheet that relate to 50% or less owned joint ventures properties that are consolidated under GAAP.

2/	Includes 346K square feet of leases that start in 2010 or later.

3/	Includes 84K square feet of leases that start in 2010 or later.

4/	Includes 91K square feet of leases that start in 2010 or later.

5/	Includes 94K square feet of leases that start in 2009 or later.

6/	Includes 213K square feet of leases that start in 2009 or later.

7/	Excludes a full allocation of internal leasing costs.


Highwoods Properties, Inc.		13		6/30/08

Leasing Statistics

Industrial Portfolio


	Three Months Ended
	6/30/08			3/31/08			12/31/07			9/30/07			6/30/07 1/			Average
Net Effective Rents Related to Re-leased Space:
Number of lease transactions (signed leases)		14			7			10			8			18			11
Rentable square footage leased		367,684			158,324			694,808			115,617			575,033			382,293
Square footage of Renewal Deals		155,126			150,170			538,836			73,793			489,312			281,447
Renewed square footage (% of total)		42.2	%		94.8	%		77.6	%		63.8	%		85.1	%		73.6	%
New Leases square footage (% of total)		57.8	%		5.2	%		22.4	%		36.2	%		14.9	%		26.4	%

Weighted average per rentable square foot over the lease term:
Base rent	$	3.85		$	5.95		$	4.03		$	7.53		$	3.82		$	5.04
Tenant improvements		(0.18	)		(0.07	)		(0.04	)		(0.71	)		(0.23	)		(0.25	)
Leasing commissions 2/		(0.10	)		0.00			(0.05	)		(0.14	)		(0.06	)		(0.07	)
Rent concessions		0.00			0.00			0.00			(0.10	)		(0.05	)		(0.03	)

Effective rent		3.57			5.88			3.94			6.58			3.48			4.69
Expense stop		(0.19	)		(0.10	)		(0.05	)		(1.04	)		(0.19	)		(0.31	)

Equivalent effective net rent	$	3.38		$	5.78		$	3.89		$	5.54		$	3.29		$	4.38

Weighted average term in years		1.8			3.3			2.6			4.3			2.3			2.9


Capital Expenditures Related to Re-leased Space:
Tenant Improvements:
Total dollars committed under signed leases	$	269,635		$	50,537		$	40,925		$	424,840		$	528,135		$	262,814
Rentable square feet		367,684			158,324			694,808			115,617			575,033			382,293

Per rentable square foot	$	0.73		$	0.32		$	0.06		$	3.67		$	0.92		$	0.69

Leasing Commissions:
Total dollars committed under signed leases 2/	$	62,837		$	1,918		$	136,633		$	74,106		$	142,246		$	83,548
Rentable square feet		367,684			158,324			694,808			115,617			575,033			382,293

Per rentable square foot	$	0.17		$	0.01		$	0.20		$	0.64		$	0.25		$	0.22

Total:
Total dollars committed under signed leases	$	332,471		$	52,455		$	177,558		$	498,945		$	670,380		$	346,362
Rentable square feet		367,684			158,324			694,808			115,617			575,033			382,293

Per rentable square foot	$	0.90		$	0.33		$	0.26		$	4.32		$	1.17		$	0.91

1/	Includes 5K square feet of leases that start in 2009 or later.

2/	Excludes a full allocation of internal leasing costs.


Highwoods Properties, Inc.		14		6/30/08

Leasing Statistics

Retail Portfolio


	Three Months Ended
	6/30/08 1/			3/31/08			12/31/07 2/			9/30/07			6/30/07			Average
Net Effective Rents Related to Re-leased Space:
Number of lease transactions (signed leases)		6			7			12			8			8			8
Rentable square footage leased		15,839			30,942			44,509			24,629			14,721			26,128
Square footage of Renewal Deals		14,162			18,826			37,318			18,097			7,072			19,095
Renewed square footage (% of total)		89.4	%		60.8	%		83.8	%		73.5	%		48.0	%		73.1	%
New Leases square footage (% of total)		10.6	%		39.2	%		16.2	%		26.5	%		52.0	%		26.9	%

Weighted average per rentable square foot over the lease term:
Base rent	$	27.61		$	31.80		$	20.44		$	24.06		$	33.29		$	27.44
Tenant improvements		(1.52	)		(0.40	)		(1.46	)		(1.17	)		(2.57	)		(1.42	)
Leasing commissions 3/		(0.67	)		(0.54	)		(0.26	)		(0.46	)		(1.25	)		(0.64	)
Rent concessions		0.00			(1.47	)		0.00			0.00			0.00			(0.29	)

Effective rent		25.42			29.39			18.72			22.43			29.47			25.09
Expense stop		0.00			0.00			0.00			0.00			0.00			0.00

Equivalent effective net rent	$	25.42		$	29.39		$	18.72		$	22.43		$	29.47		$	25.09

Weighted average term in years		7.7			8.6			5.6			6.1			7.0			7.0


Capital Expenditures Related to Re-leased Space:
Tenant Improvements:
Total dollars committed under signed leases	$	177,176		$	161,500		$	509,473		$	260,407		$	335,337		$	288,778
Rentable square feet		15,839			30,942			44,509			24,629			14,721			26,128

Per rentable square foot	$	11.19		$	5.22		$	11.45		$	10.57		$	22.78		$	11.05

Leasing Commissions:
Total dollars committed under signed leases 3/	$	5,794		$	123,220		$	21,542		$	17,601		$	83,077		$	50,247
Rentable square feet		15,839			30,942			44,509			24,629			14,721			26,128

Per rentable square foot	$	0.37		$	3.98		$	0.48		$	0.71		$	5.64		$	1.92

Total:
Total dollars committed under signed leases	$	182,970		$	284,720		$	531,015		$	278,008		$	418,414		$	339,025
Rentable square feet		15,839			30,942			44,509			24,629			14,721			26,128

Per rentable square foot	$	11.55		$	9.20		$	11.93		$	11.29		$	28.42		$	12.98

1/	Includes 3K square feet of leases that start in 2010 or later.

2/	Includes 9K square feet of leases that start in 2010 or later.

3/	Excludes a full allocation of internal leasing costs.


Highwoods Properties, Inc.		15		6/30/08

Leasing Statistics by Market

For the Three Months Ended As of 6/30/08

Office Portfolio 1/


Market	Rentable Square Feet Leased	Average Term	GAAP Rental Rate		TI’s Per SF		Lease Commissions Per SF 2/ 3/
Tampa	448,048	3.7	$	25.78	$	5.03	$	3.08
Atlanta	204,240	1.9		19.75		3.65		0.91
Raleigh	104,235	1.8		20.00		2.09		0.77
Nashville	51,280	4.6		21.04		8.22		1.76
Piedmont Triad	50,644	3.2		12.62		2.75		0.23
Richmond	48,197	3.9		17.57		7.34		2.28
Greenville	31,991	4.7		17.37		13.69		4.65
Kansas City	28,805	4.9		23.92		11.69		5.97
Memphis	22,787	3.6		21.94		13.37		2.14
Orlando	4,733	1.3		26.70		0.00		1.42
Other	2,640	3.6		15.52		5.81		7.14

	997,600	3.2	$	22.19	$	5.24	$	2.31

Industrial Portfolio


Market	Rentable Square Feet Leased	Average Term	GAAP Rental Rate		TI’s Per SF		Lease Commissions Per SF 2/ 3/
Piedmont Triad	230,084	0.9	$	3.68	$	0.42	$	0.06
Atlanta	137,600	3.2		4.15		1.25		0.34

	367,684	1.8	$	3.85	$	0.73	$	0.17

Retail Portfolio


Market	Rentable Square Feet Leased	Average Term	GAAP Rental Rate		TI’s Per SF		Lease Commissions Per SF 2/ 3/
Kansas City	15,839	7.7	$	27.61	$	11.19	$	0.37

	15,839	7.7	$	27.61	$	11.19	$	0.37

1/	Excludes properties recorded on our Balance Sheet that relate to 50% or less owned joint ventures properties that are consolidated under GAAP.

2/	Lease commissions by market per square foot excludes capitalized internal leasing costs.

3/	The amount of capitalized internal leasing cost not allocated to individual deals or product types was $681K.


Highwoods Properties, Inc.		16		6/30/08

Rental Rate Comparisons by Market

For the Three Months Ended As of 6/30/08

Office Portfolio 1/


Market	Rentable Square Feet Leased	Current Rent		Previous Rent		Percentage Change Rent
Tampa	448,048	$	25.78	$	23.18	11.2	%
Atlanta	204,240		19.75		19.54	1.1	%
Raleigh	104,235		20.00		19.31	3.6	%
Nashville	51,280		21.04		17.81	18.1	%
Piedmont Triad	50,644		12.62		12.29	2.7	%
Richmond	48,197		17.57		16.23	8.3	%
Greenville	31,991		17.37		16.83	3.2	%
Kansas City	28,805		23.92		22.27	7.4	%
Memphis	22,787		21.94		19.28	13.8	%
Orlando	4,733		26.70		22.22	20.2	%
Other	2,640		15.52		13.07	18.7	%

GAAP Rent Growth	997,600	$	22.19	$	20.51	8.2	%

Cash Rent Growth	997,600	$	21.77	$	22.80	-4.5	%

Industrial Portfolio


Market	Rentable Square Feet Leased	Current Rent		Previous Rent		Percentage Change Rent
Piedmont Triad	230,084	$	3.68	$	3.53	4.2	%
Atlanta	137,600		4.15		3.78	9.7	%

GAAP Rent Growth	367,684	$	3.85	$	3.62	6.3	%

Cash Rent Growth	367,684	$	3.82	$	3.73	2.3	%

Retail Portfolio


Market	Rentable Square Feet Leased	Current Rent		Previous Rent 2/		Percentage Change Rent
Kansas City	15,839	$	27.61	$	24.08	14.7	%

GAAP Rent Growth	15,839	$	27.61	$	24.08	14.7	%

Cash Rent Growth	15,839	$	26.88	$	25.53	5.3	%

Average Cash Rental Rates for All In Place Leases at: 1/ 3/


Type	6/30/08			6/30/07			6/30/06			6/30/05			6/30/04
Office	$	19.80		$	19.26		$	18.16		$	17.64		$	17.49
Industrial		5.30			5.19			5.10			5.02			4.68
Retail 2/		31.33			30.94			28.07			27.80			25.88

Weighted average rate	$	16.87		$	16.40		$	15.51		$	15.44		$	14.70

Annual % growth rate		2.9	%		5.7	%		0.5	%		5.0	%

1/	Excludes properties recorded on our Balance Sheet that relate to 50% or less owned joint ventures properties that are consolidated under GAAP.

2/	Excludes percentage rent.

3/	Average cash rental rates represent June, 2008 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line rental income) multiplied by 12 and divided by the related leased square feet.


Highwoods Properties, Inc.		17		6/30/08

Lease Expirations

June 30, 2008

Dollars in thousands


Year	Rentable Square Feet Expiring	Percent of Rentable Square Feet		Annualized Cash Revenue 1/		Average Rental Rate		Percent of Annualized Cash Revenue 1/
Office: 2/

2008 /3	647,954	3.6	%	$	14,041	$	21.67	4.0	%
2009	2,246,706	12.6	%		45,175		20.11	12.8	%
2010	2,097,533	11.7	%		43,036		20.52	12.2	%
2011	2,677,157	15.1	%		52,213		19.50	14.7	%
2012	2,290,329	12.8	%		46,886		20.47	13.2	%
2013	2,274,011	12.7	%		42,783		18.81	12.1	%
2014	1,540,106	8.6	%		30,768		19.98	8.7	%
2015	1,055,101	5.9	%		21,280		20.17	6.0	%
2016	755,315	4.2	%		14,035		18.58	4.0	%
2017	952,032	5.3	%		19,193		20.16	5.4	%
2018 and thereafter	1,334,308	7.5	%		24,346		18.25	6.9	%

	17,870,552	100.0	%	$	353,756	$	19.80	100.0	%

Industrial:

2008 /4	224,368	3.7	%	$	1,063	$	4.74	3.3	%
2009	1,182,188	19.4	%		6,457		5.46	20.0	%
2010	825,682	13.5	%		4,301		5.21	13.4	%
2011	1,116,037	18.3	%		5,479		4.91	17.0	%
2012	454,550	7.5	%		2,766		6.09	8.6	%
2013	547,142	9.0	%		3,372		6.16	10.5	%
2014	436,065	7.2	%		2,479		5.68	7.7	%
2015	271,382	4.5	%		1,124		4.14	3.5	%
2016	264,597	4.4	%		1,040		3.93	3.2	%
2017	149,600	2.5	%		737		4.93	2.3	%
2018 and thereafter	604,640	10.0	%		3,367		5.57	10.5	%

	6,076,251	100.0	%	$	32,185	$	5.30	100.0	%

1/	Annualized Cash Revenue is June, 2008 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line rental income) multiplied by 12.

2/	Excludes properties recorded on our Balance Sheet that relate to 50% or less owned joint ventures properties that are consolidated under GAAP.

3/	Includes 26,000 square feet of leases that are on a month to month basis or 0.1% of total annualized revenue.

4/	Includes 105,000 square feet of leases that are on a month to month basis or 0.1% of total annualized revenue.

Note: 2008 and beyond expirations that have been renewed are reflected above based on the renewal expiration date.


Highwoods Properties, Inc.		18		6/30/08

Lease Expirations

June 30, 2008

(Continued)

Dollars in thousands


Year	Rentable Square Feet Expiring	Percent of Rentable Square Feet		Annualized Cash Revenue 1/		Average Rental Rate		Percent of Annualized Cash Revenue 1/
Retail:

2008 2/	57,467	4.6	%	$	1,019	$	17.73	2.6	%
2009	136,490	10.9	%		4,384		32.12	11.1	%
2010	90,339	7.2	%		3,602		39.87	9.2	%
2011	58,702	4.7	%		1,975		33.64	5.0	%
2012	165,979	13.2	%		5,162		31.10	13.1	%
2013	70,818	5.6	%		2,728		38.52	6.9	%
2014	102,285	8.1	%		2,478		24.23	6.3	%
2015	144,364	11.5	%		4,636		32.11	11.8	%
2016	65,526	5.2	%		2,744		41.88	7.0	%
2017	107,946	8.6	%		2,724		25.23	6.9	%
2018 and thereafter	255,786	20.4	%		7,895		30.87	20.1	%

	1,255,702	100.0	%	$	39,347	$	31.33	100.0	%

Total:

2008 3/ 4/	929,789	3.7	%	$	16,123	$	17.34	3.8	%
2009	3,565,384	14.1	%		56,016		15.71	13.2	%
2010	3,013,554	12.0	%		50,939		16.90	12.0	%
2011	3,851,896	15.4	%		59,667		15.49	13.9	%
2012	2,910,858	11.5	%		54,814		18.83	12.9	%
2013	2,891,971	11.5	%		48,883		16.90	11.5	%
2014	2,078,456	8.2	%		35,725		17.19	8.4	%
2015	1,470,847	5.8	%		27,040		18.38	6.4	%
2016	1,085,438	4.3	%		17,819		16.42	4.2	%
2017	1,209,578	4.8	%		22,654		18.73	5.3	%
2018 and thereafter	2,194,734	8.7	%		35,608		16.22	8.4	%

	25,202,505	100.0	%	$	425,288	$	16.87	100.0	%

1/	Annualized Cash Revenue is June, 2008 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line rental income) multiplied by 12.

2/	Includes 15,000 square feet of leases that are on a month to month basis or 0.1% of total annualized revenue.

3/	Includes 146,000 square feet of leases that are on a month to month basis or 0.3% of total annualized revenue.

4/	Excludes properties recorded on our Balance Sheet that relate to 50% or less owned joint ventures properties that are consolidated under GAAP.

Note: 2008 and beyond expirations that have been renewed are reflected above based on the renewal expiration date.


Highwoods Properties, Inc.		19		6/30/08

Office Lease Expirations by Market by Quarter 1/

Dollars in thousands


			*Three Months Ended*
			9/30/08 2/			12/31/08			3/31/09			6/30/09			Total
Atlanta	RSF			41,536			10,482			20,132			64,921			137,071
	% of Total Office RSF			0.2	%		0.1	%		0.1	%		0.4	%		0.8	%
	Annualized Cash Revenue	3/	$	909		$	195		$	372		$	936		$	2,412
	% of Total Office Annl Cash Rev			0.3	%		0.1	%		0.1	%		0.3	%		0.7	%

Greenville	RSF			16,970			0			19,998			29,135			66,103
	% of Total Office RSF			0.1	%		0.0	%		0.1	%		0.2	%		0.4	%
	Annualized Cash Revenue	3/	$	331		$	—		$	333		$	492		$	1,156
	% of Total Office Annl Cash Rev			0.1	%		0.0	%		0.1	%		0.1	%		0.3	%

Kansas City	RSF			6,592			11,023			16,833			7,805			42,253
	% of Total Office RSF			0.0	%		0.1	%		0.1	%		0.0	%		0.2	%
	Annualized Cash Revenue	3/	$	213		$	270		$	400		$	191		$	1,074
	% of Total Office Annl Cash Rev			0.1	%		0.1	%		0.1	%		0.1	%		0.3	%

Memphis	RSF			17,479			29,772			63,708			26,133			137,092
	% of Total Office RSF			0.1	%		0.2	%		0.4	%		0.1	%		0.8	%
	Annualized Cash Revenue	3/	$	355		$	665		$	1,444		$	528		$	2,992
	% of Total Office Annl Cash Rev			0.1	%		0.2	%		0.4	%		0.1	%		0.8	%

Nashville	RSF			15,525			30,386			118,500			100,106			264,517
	% of Total Office RSF			0.1	%		0.2	%		0.7	%		0.6	%		1.5	%
	Annualized Cash Revenue	3/	$	284		$	677		$	2,339		$	1,943		$	5,243
	% of Total Office Annl Cash Rev			0.1	%		0.2	%		0.7	%		0.5	%		1.5	%

Orlando	RSF			0			0			0			11,482			11,482
	% of Total Office RSF			0.0	%		0.0	%		0.0	%		0.1	%		0.1	%
	Annualized Cash Revenue	3/	$	—		$	—		$	—		$	274		$	274
	% of Total Office Annl Cash Rev			0.0	%		0.0	%		0.0	%		0.1	%		0.1	%

Piedmont Triad	RSF			31,696			14,074			23,056			31,062			99,888
	% of Total Office RSF			0.2	%		0.1	%		0.1	%		0.2	%		0.6	%
	Annualized Cash Revenue	3/	$	617		$	243		$	463		$	536		$	1,859
	% of Total Office Annl Cash Rev			0.2	%		0.1	%		0.1	%		0.2	%		0.5	%

Raleigh	RSF			200,645			49,326			226,469			20,991			497,431
	% of Total Office RSF			1.1	%		0.3	%		1.3	%		0.1	%		2.7	%
	Annualized Cash Revenue	3/	$	4,737		$	942		$	4,669		$	462		$	10,810
	% of Total Office Annl Cash Rev			1.3	%		0.3	%		1.3	%		0.1	%		3.1	%

Richmond	RSF			88,058			13,456			109,235			48,814			259,563
	% of Total Office RSF			0.5	%		0.1	%		0.6	%		0.3	%		1.5	%
	Annualized Cash Revenue	3/	$	1,767		$	248		$	2,257		$	911		$	5,183
	% of Total Office Annl Cash Rev			0.5	%		0.1	%		0.6	%		0.3	%		1.5	%

Tampa	RSF			54,965			10,442			108,499			54,683			228,589
	% of Total Office RSF			0.3	%		0.1	%		0.6	%		0.3	%		1.3	%
	Annualized Cash Revenue	3/	$	1,190		$	252		$	2,544		$	1,231		$	5,217
	% of Total Office Annl Cash Rev			0.3	%		0.1	%		0.7	%		0.3	%		1.5	%

Other	RSF			5,527			0			6,166			0			11,693
	% of Total Office RSF			0.0	%		0.0	%		0.0	%		0.0	%		0.1	%
	Annualized Cash Revenue	3/	$	148		$	—		$	121		$	—		$	269
	% of Total Office Annl Cash Rev			0.0	%		0.0	%		0.0	%		0.0	%		0.1	%

Total	RSF			478,993			168,961			712,596			395,132			1,755,682
	% of Total Office RSF			2.6	%		0.9	%		4.0	%		2.2	%		9.8	%
	Annualized Cash Revenue	3/	$	10,551		$	3,492		$	14,942		$	7,504		$	36,489
	% of Total Office Annl Cash Rev			3.0	%		1.0	%		4.2	%		2.1	%		10.3	%

1/	Excludes properties recorded on our Balance Sheet that relate to 50% or less owned joint ventures properties that are consolidated under GAAP.

2/	Includes 26,000 square feet of leases that are on a month to month basis or 0.1% of total annualized revenue.

3/	Annualized Cash Revenue is June, 2008 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line rental income) multiplied by 12.


Highwoods Properties, Inc.		20		6/30/08

Industrial Lease Expirations by Market by Quarter

Dollars in thousands


			*Three Months Ended*
			9/30/08 1/			12/31/08			3/31/09			6/30/09			Total
Atlanta	RSF			49,857			0			112,612			34,300			196,769
	% of Total Industrial RSF			0.8	%		0.0	%		1.9	%		0.6	%		3.2	%
	Annualized Cash Revenue	2/	$	170		$	—		$	731		$	215		$	1,116
	% of Total Industrial Annl Cash Rev			0.6	%		0.0	%		2.3	%		0.7	%		3.5	%

Kansas City	RSF			0			0			1,756			0			1,756
	% of Total Industrial RSF			0.0	%		0.0	%		0.0	%		0.0	%		0.0	%
	Annualized Cash Revenue	2/	$	—		$	—		$	20		$	—		$	20
	% of Total Industrial Annl Cash Rev			0.0	%		0.0	%		0.1	%		0.0	%		0.1	%

Piedmont Triad	RSF			96,047			78,464			289,378			519,320			983,209
	% of Total Industrial RSF			1.6	%		1.3	%		4.8	%		8.5	%		16.2	%
	Annualized Cash Revenue	2/	$	389		$	505		$	1,463		$	2,400		$	4,757
	% of Total Industrial Annl Cash Rev			1.2	%		1.6	%		4.5	%		7.5	%		14.8	%

Total	RSF			145,904			78,464			403,746			553,620			1,181,734
	% of Total Industrial RSF			2.4	%		1.3	%		6.6	%		9.1	%		19.4	%
	Annualized Cash Revenue	2/	$	559		$	505		$	2,214		$	2,615		$	5,893
	% of Total Industrial Annl Cash Rev			1.8	%		1.6	%		6.9	%		8.1	%		18.4	%

1/	Includes 105,000 square feet of leases that are on a month to month basis or 0.1% of total annualized revenue.

2/	Annualized Cash Revenue is June, 2008 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line rental income) multiplied by 12.


Highwoods Properties, Inc.		21		6/30/08

Office Lease Expirations by Market by Year 1/

Dollars in thousands


			2008 2/			2009			2010			2011			Thereafter
Atlanta	RSF			52,018			264,001			91,795			293,199			1,503,040
	% of Total Office RSF			0.3	%		1.5	%		0.5	%		1.6	%		8.4	%
	Annualized Cash Revenue	3/	$	1,104		$	4,459		$	1,796		$	6,328		$	28,711
	% of Total Office Annl Cash Rev			0.3	%		1.3	%		0.5	%		1.8	%		8.1	%

Greenville	RSF			16,970			60,122			57,236			104,244			581,607
	% of Total Office RSF			0.1	%		0.3	%		0.3	%		0.6	%		3.3	%
	Annualized Cash Revenue	3/	$	331		$	1,022		$	868		$	1,900		$	9,359
	% of Total Office Annl Cash Rev			0.1	%		0.3	%		0.2	%		0.5	%		2.6	%

Kansas City	RSF			17,615			44,124			104,158			69,865			321,787
	% of Total Office RSF			0.1	%		0.2	%		0.6	%		0.4	%		1.8	%
	Annualized Cash Revenue	3/	$	483		$	1,051		$	2,986		$	1,806		$	8,421
	% of Total Office Annl Cash Rev			0.1	%		0.3	%		0.8	%		0.5	%		2.4	%

Memphis	RSF			47,251			176,505			212,005			156,906			657,777
	% of Total Office RSF			0.3	%		1.0	%		1.2	%		0.9	%		3.7	%
	Annualized Cash Revenue	3/	$	1,019		$	3,588		$	4,491		$	3,112		$	11,577
	% of Total Office Annl Cash Rev			0.3	%		1.0	%		1.3	%		0.9	%		3.3	%

Nashville	RSF			45,911			574,808			456,444			386,346			1,556,164
	% of Total Office RSF			0.3	%		3.2	%		2.6	%		2.2	%		8.7	%
	Annualized Cash Revenue	3/	$	961		$	11,802		$	9,354		$	7,841		$	31,855
	% of Total Office Annl Cash Rev			0.3	%		3.3	%		2.6	%		2.2	%		9.0	%

Orlando	RSF			0			16,215			77,080			106,313			111,676
	% of Total Office RSF			0.0	%		0.1	%		0.4	%		0.6	%		0.6	%
	Annualized Cash Revenue	3/	$	—		$	400		$	1,788		$	2,332		$	1,750
	% of Total Office Annl Cash Rev			0.0	%		0.1	%		0.5	%		0.7	%		0.5	%

Piedmont Triad	RSF			45,770			135,583			235,164			423,301			861,380
	% of Total Office RSF			0.3	%		0.8	%		1.3	%		2.4	%		4.8	%
	Annualized Cash Revenue	3/	$	861		$	2,236		$	3,813		$	6,199		$	13,270
	% of Total Office Annl Cash Rev			0.2	%		0.6	%		1.1	%		1.8	%		3.8	%

Raleigh	RSF			249,971			480,105			384,891			615,092			1,690,706
	% of Total Office RSF			1.4	%		2.7	%		2.2	%		3.4	%		9.5	%
	Annualized Cash Revenue	3/	$	5,678		$	10,015		$	7,504		$	12,482		$	30,365
	% of Total Office Annl Cash Rev			1.6	%		2.8	%		2.1	%		3.5	%		8.6	%

Richmond	RSF			101,514			232,353			249,499			420,310			1,049,014
	% of Total Office RSF			0.6	%		1.3	%		1.4	%		2.4	%		5.9	%
	Annualized Cash Revenue	3/	$	2,015		$	4,529		$	4,767		$	7,864		$	18,554
	% of Total Office Annl Cash Rev			0.6	%		1.3	%		1.3	%		2.2	%		5.2	%

Tampa	RSF			65,407			256,105			196,991			100,001			1,830,024
	% of Total Office RSF			0.4	%		1.4	%		1.1	%		0.6	%		10.2	%
	Annualized Cash Revenue	3/	$	1,442		$	5,942		$	4,847		$	2,293		$	44,267
	% of Total Office Annl Cash Rev			0.4	%		1.7	%		1.4	%		0.6	%		12.5	%

Other	RSF			5,527			6,785			32,270			1,580			38,027
	% of Total Office RSF			0.0	%		0.0	%		0.2	%		0.0	%		0.2	%
	Annualized Cash Revenue	3/	$	148		$	131		$	823		$	56		$	1,162
	% of Total Office Annl Cash Rev			0.0	%		0.0	%		0.2	%		0.0	%		0.3	%

Total	RSF			647,954			2,246,706			2,097,533			2,677,157			10,201,202
	% of Total Office RSF			3.6	%		12.6	%		11.7	%		15.0	%		57.1	%
	Annualized Cash Revenue	3/	$	14,042		$	45,175		$	43,037		$	52,213		$	199,291
	% of Total Office Annl Cash Rev			4.0	%		12.8	%		12.2	%		14.8	%		56.3	%

1/	Excludes properties recorded on our Balance Sheet that relate to 50% or less owned joint ventures properties that are consolidated under GAAP.

2/	Includes 26,000 square feet of leases that are on a month to month basis or 0.1% of total annualized revenue.

3/	Annualized Cash Revenue is June, 2008 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line rental income) multiplied by 12.


Highwoods Properties, Inc.		22		6/30/08

Industrial Lease Expirations by Market by Year

Dollars in thousands


			2008 1/			2009			2010			2011			Thereafter
Atlanta	RSF			49,857			333,368			316,221			719,054			1,483,974
	% of Total Industrial RSF			0.8	%		5.5	%		5.2	%		11.8	%		24.4	%
	Annualized Cash Revenue	2/	$	169		$	2,200		$	1,840		$	3,931		$	8,379
	% of Total Industrial Annl Cash Rev			0.5	%		6.8	%		5.7	%		12.2	%		26.0	%

Kansas City	RSF			0			1,756			0			0			0
	% of Total Industrial RSF			0.0	%		0.0	%		0.0	%		0.0	%		0.0	%
	Annualized Cash Revenue	2/	$	—		$	20		$	—		$	—		$	—
	% of Total Industrial Annl Cash Rev			0.0	%		0.1	%		0.0	%		0.0	%		0.0	%

Piedmont Triad	RSF			174,511			847,064			509,461			396,983			1,244,002
	% of Total Industrial RSF			2.9	%		13.9	%		8.4	%		6.5	%		20.5	%
	Annualized Cash Revenue	2/	$	894		$	4,238		$	2,461		$	1,549		$	6,506
	% of Total Industrial Annl Cash Rev			2.8	%		13.2	%		7.6	%		4.8	%		20.2	%

Total	RSF			224,368			1,182,188			825,682			1,116,037			2,727,976
	% of Total Industrial RSF			3.7	%		19.5	%		13.6	%		18.4	%		44.9	%
	Annualized Cash Revenue	2/	$	1,063		$	6,458		$	4,301		$	5,480		$	14,885
	% of Total Industrial Annl Cash Rev			3.3	%		20.1	%		13.4	%		17.0	%		46.2	%

1/	Includes 105,000 square feet of leases that are on a month to month basis or 0.1% of total annualized revenue.

2/	Annualized Cash Revenue is June, 2008 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line rental income) multiplied by 12.


Highwoods Properties, Inc.		23		6/30/08

Customer Diversification 1/

June 30, 2008

Dollars in thousands

Top 20 Customers


Customer	RSF	Annualized Cash Revenue 2/		Percent of Annualized Cash Revenue 2/		Average Remaining Lease Term in Years
Federal Government	1,628,980	$	32,008	7.53	%	8.0
AT&T	896,147		15,000	3.53	%	3.6
Price Waterhouse Coopers	369,649		9,699	2.28	%	3.3
State of Georgia	367,986		7,685	1.81	%	2.3
Healthways	255,041		5,704	1.34	%	14.7
T-Mobile USA	207,517		5,639	1.33	%	5.5
Metropolitan Life Insurance	267,787		5,401	1.27	%	9.4
Lockton Companies	160,561		4,402	1.04	%	6.7
Syniverse Technologies	198,750		3,949	0.93	%	8.3
BB&T	238,595		3,854	0.91	%	4.5
Fluor Enterprises	209,474		3,729	0.88	%	3.6
SCI Services 3/	162,784		3,620	0.85	%	9.1
Jacobs Engineering Group	181,794		2,858	0.67	%	7.2
Vanderbilt University	144,161		2,843	0.67	%	7.3
Lifepoint Corporate Services	129,217		2,629	0.62	%	3.1
Wachovia	112,781		2,544	0.60	%	2.7
Icon Clinical Research	110,909		2,540	0.60	%	5.2
Talecris Biotherapeutics	122,870		2,371	0.56	%	4.0
HDR Engineering	80,499		2,293	0.54	%	8.5
HCA Physician Services	130,599		2,286	0.54	%	5.5

	5,976,101	$	121,054	28.50	%	6.3

By Industry


Category	Percent of Annualized Cash Revenue 2/
Professional, Scientific, and Technical Services	20.9	%
Government/Public Administration	9.9	%
Finance/Banking	9.4	%
Insurance	9.0	%
Retail Trade	7.5	%
Manufacturing	6.3	%
Telecommunication	6.3	%
Wholesale Trade	6.2	%
Health Care and Social Assistance	6.1	%
Real Estate Rental and Leasing	4.0	%
Information	2.9	%
Administrative and Support Services	2.9	%
Accommodation and Food Services	2.7	%
Transportation and Warehousing	2.3	%
Other Services (except Public Administration)	2.1	%
Educational Services	1.5	%

	100.0	%

1/	Excludes properties recorded on our Balance Sheet that relate to 50% or less owned joint ventures properties that are consolidated under GAAP.

2/	Annualized Cash Revenue is June, 2008 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line rental income) multiplied by 12.

3/	SCI Services (Saxon Capital, Inc.) is a wholly owned subsidiary of Morgan Stanley.


Highwoods Properties, Inc.		24		6/30/08

Same Property Performance 1/

Dollars and Square Feet in thousands


	Three months ended June 30,						Percentage Change
	2008			2007			Percentage Change
Rental revenues 2/	$	101,040		$	96,421		4.8	%
Operating expenses		(37,674	)		(35,995	)	-4.7	%

		63,366			60,426		4.9	%
Straight line rent		102			55		85.5	%

		63,468			60,481		4.9	%
Lease termination fees		23			1,477		-98.4	%

Net operating income	$	63,491		$	61,958		2.5	%

Average occupancy		90.8	%		90.3	%	0.6	%

Rentable square feet		25,203			25,203


	Six months ended June 30,						Percentage Change
	2008			2007			Percentage Change
Rental revenues 2/	$	201,495		$	194,416		3.6	%
Operating expenses		(74,184	)		(71,718	)	-3.4	%

		127,311			122,698		3.8	%
Straight line rent		624			749		-16.7	%

		127,935			123,447		3.6	%
Lease termination fees		1,923			1,515		26.9	%

Net operating income	$	129,858		$	124,962		3.9	%

Average occupancy		90.8	%		90.3	%	0.6	%

Rentable square feet		25,203			25,203


	Second Quarter: 2008 vs 2007				June YTD: 2008 vs 2007
Market	NOI 3/ Percentage Change		Occupancy Percentage Change		NOI 3/ Percentage Change		Occupancy Percentage Change
Atlanta	-6.9	%	-0.8	%	-3.5	%	-0.5	%
Greenville	15.0	%	6.2	%	11.7	%	4.5	%
Kansas City	1.8	%	-0.8	%	-2.3	%	-1.3	%
Memphis	7.9	%	0.5	%	5.5	%	1.5	%
Nashville	12.5	%	3.6	%	9.9	%	3.7	%
Orlando	-5.4	%	-0.7	%	-5.5	%	-2.1	%
Piedmont Triad	2.3	%	-2.3	%	0.0	%	-2.9	%
Raleigh	11.2	%	4.3	%	8.5	%	4.6	%
Richmond	9.4	%	3.8	%	8.2	%	4.0	%
Tampa	9.5	%	-2.5	%	5.9	%	-3.1	%

	4.9	%	0.6	%	3.6	%	0.6	%

1/	Excludes a property held for sale at 6/30/08 which constitutes 250,000 rentable square feet.

2/	Excludes straight line rents and lease termination fees.

3/	Includes straight line rents and excludes lease termination fees.


Highwoods Properties, Inc.		25		6/30/08

Disposition Activity

Dollars in thousands

Name

Market

Type 1/

Date
Sold

Square
Footage

Occupancy

Gross Sales
Price

First quarter 2008:

Parkway Medical

Kansas City

02/15/08

30,000

81.4

6,050

First quarter totals

30,000

81.4

6,050

Second quarter 2008:

Fairway North & West

Kansas City

04/02/08

130,000

74.6

11,676

Corinth Office

Kansas City

06/20/08

141,000

75.3

9,950

Second quarter totals

271,000

74.9

21,626

2008 totals

301,000

75.6

27,676

1/	The letter “O” represents Office.


Highwoods Properties, Inc.		26		6/30/08

Development Activity

Dollars in thousands


Property In - Process	Market	Type 1/	Rentable Square Feet	Anticipated Total Investment		Investment @ 06/30/08			Pre Leased %		Estimated Completion Date	Estimated Stabilization Date
Office:
FAA	Atlanta	O	100,000	$	18,071	$	3,005		100	%	2Q 09	2Q 09
Jackson FBI	Jackson, MS	O	110,000		31,713		6,016		100	%	1Q 09	1Q 09
Triad Centre III	Memphis	O	148,000		29,187		2,134		17	%	3Q 09	2Q 11
Cool Springs IV	Nashville	O	153,000		27,597		17,997		6	%	3Q 08	1Q 10
RBC Plaza 2/	Raleigh	O	292,000		76,056		57,764		91	%	4Q 08	4Q 09

Total or Weighted Average			803,000	$	182,624	$	86,916		64	%

						$	Weighted	%	69	%

For Sale Development:
RBC Plaza Condominiums 3/ 4/	Raleigh	RC	139 Units	$	42,380	$	30,249		138 Contracts		4Q 08	2Q 09

				$	42,380	$	30,249

Industrial:
River Point IV	Atlanta	I	200,000	$	10,435	$	1,564		50	%	1Q 09	2Q 10

			200,000	$	10,435	$	1,564		50	%

In-Process Total or Weighted Average 4/			1,003,000	$	235,439	$	118,729		61	%

						$	Weighted	%	68	%

Completed Not Stabilized 5/
Office:
Centregreen V	Raleigh	O	98,000	$	15,662	$	12,329		68	%	1Q 08	3Q 09
Glenlake VI	Raleigh	O	122,000		24,448		20,723		57	%	1Q 08	3Q 09
Highwoods Baycenter I	Tampa	O	208,000		43,100		42,070		86	%	3Q 07	4Q 08

Total or Weighted Average			428,000	$	83,210	$	75,122		74	%

						$	Weighted	%	74	%

Industrial:
Enterprise II	Piedmont Triad	I	418,000	$	17,222	$	15,875		72	%	4Q 06	4Q 08

			418,000	$	17,222	$	15,875		72	%

						$	Weighted	%	72	%

Completed Not Stabilized Total or Weighted Average			846,000	$	100,432	$	90,997		73	%

						$	Weighted	%	74	%

Grand Total or Weighted Average			1,849,000	$	335,871	$	209,726		66	%

						$	Weighted	%	70	%

Placed in Service in 2Q


Property	Market	Type 1/	Rentable Square Feet	Anticipated Total Investment		Investment @ 06/30/08			Pre Leased %		Occ %		In-Service Date
Comcast	Memphis	O	62,000	$	9,449	$	8,256		100	%	100	%	4/1/08
Newpoint V	Atlanta	I	263,000		12,947		12,309		88	%	88	%	6/1/08
North Shore Commons II	Richmond	O	96,000		14,855		13,304		66	%	59	%	6/1/08

Total or Weighted Average			421,000	$	37,251	$	33,869		85	%	83	%

						$	Weighted	%	82	%	79	%

1/	The Letters “O”, “I”, “R” and “RC” represent: Office, Industrial, Retail and For Sale Residential Condominiums, respectively.

2/	Includes ancillary retail space on the ground level of approximately 11,000 square feet.

3/	In January 2007 the Company executed a Joint Venture agreement for this development. The Company has a 93% interest and consolidates this Joint Venture.

The investment amounts shown represent the Company’s 93% share.

4/	As of 6/30/08, Condo units and numbers are not part of In-Process Total or Weighted Average for SF & Pre-Leasing percentage.

5/	“Completed Not Stabilized” and Redevelopment properties are recorded in the Consolidated Balance Sheet in the Land and Building accounts, not Development-in-Process.


Highwoods Properties, Inc.		27		6/30/08

Development Land

June 30, 2008

Dollars in thousands


Market	Usable Acres	Total Estimated Market Value
Atlanta	224	$	24,863
Raleigh	190		43,558
Greensboro	47		12,495
Baltimore	39		10,300
Richmond	33		8,211
Tampa	20		13,901
Nashville	16		7,917
Memphis	15		3,487
Orlando	15		16,278
Winston-Salem	10		2,148
Kansas City	1		2,100

Total 1/ 2/ 3/	610	$	145,258

1/	Developable square footage on core land holdings, which constitute 475 of the total 610 acres, is approximately 4.9 million of office space and 2.5 million of industrial space.

2/	Includes 34 acres ($8.9 million based on expected gross proceeds) included in property held for sale at June 30, 2008.

3/	Includes 75 acres currently classified as Development in Process on our consolidated balance sheet.


Highwoods Properties, Inc.		28		6/30/08

Acquisition Activity

Dollars in thousands


Name	Market	Type	Date Acquired	Square Footage	Total Cost
First quarter 2008:
None

Second quarter 2008:
None


Highwoods Properties, Inc.		29		6/30/08

Unconsolidated Joint Ventures Assets, Debt and Liabilities

June 30, 2008

Dollars in thousands


	Type 1/	Own %		Venture’s Books
Joint Venture	Type 1/	Own %		Total Assets		Debt		Total Liabilities
Board of Trade Investment Co.	O	49.00	%	$	7,350	$	—	$	543
Dallas County Partners I, LP	O/ I	50.00	%		32,230		48,849		52,197
Dallas County Partners II, LP	O	50.00	%		14,268		15,734		17,270
Dallas County Partners III, LP	O	50.00	%		126		—		39
Fountain Three	O/I /R	50.00	%		25,257		32,638		34,795
RRHWoods, LLC	O/ M	50.00	%		87,001		81,232		85,743
Kessinger/Hunter, LLC	-	26.50	%		7,108		—		254
4600 Madison Associates, LP	O	12.50	%		18,034		13,100		13,694
Highwoods DLF 98/29, LP	O	22.81	%		149,886		75,260		80,471
Highwoods DLF 97/26 DLF 99/32, LP	O	42.93	%		100,667		55,340		58,918
Concourse Center Associates, LLC	O	50.00	%		13,395		8,797		9,037
Plaza Colonnade, LLC	O/R	50.00	%		72,445		66,056		67,653
Highwoods KC Glenridge Office, LP	O	40.00	%		22,636		16,479		17,561
Highwoods KC Glenridge Land, LP	O	40.00	%		779		—		105
Highwoods KC Orlando, LLC	O	40.00	%		204,435		140,727		149,313
Highwoods DLF Forum, LLC	O	25.00	%		121,236		67,500		71,928

Total				$	876,853	$	621,712	$	659,521


	Type 1/	Own %		Highwoods’ Share of Joint Venture
Joint Venture	Type 1/	Own %		Total Assets		Debt		Total Liabilities
Board of Trade Investment Co.	O	49.00	%	$	3,602	$	—	$	266
Dallas County Partners I, LP	O/ I	50.00	%		16,115		24,425		26,099
Dallas County Partners II, LP	O	50.00	%		7,134		7,867		8,635
Dallas County Partners III, LP	O	50.00	%		63		—		20
Fountain Three	O/I /R	50.00	%		12,629		16,319		17,398
RRHWoods, LLC	O/ M	50.00	%		43,501		40,616		42,872
Kessinger/Hunter, LLC	-	26.50	%		1,884		—		67
4600 Madison Associates, LP	O	12.50	%		2,254		1,638		1,712
Highwoods DLF 98/29, LP	O	22.81	%		34,189		17,167		18,355
Highwoods DLF 97/26 DLF 99/32, LP	O	42.93	%		43,216		23,758		25,293
Concourse Center Associates, LLC	O	50.00	%		6,698		4,399		4,519
Plaza Colonnade, LLC	O/R	50.00	%		36,223		33,028		33,827
Highwoods KC Glenridge Office, LP	O	40.00	%		9,054		6,592		7,024
Highwoods KC Glenridge Land, LP	O	40.00	%		312		—		42
Highwoods KC Orlando, LLC	O	40.00	%		81,774		56,291		59,725
Highwoods DLF Forum, LLC	O	25.00	%		30,304		16,872		17,979

Total 2/				$	328,952	$	248,972	$	263,833

1/	The letters “O”, “I”, “R”, and “M” represent Office, Industrial, Retail, and Multi-Family, respectively.

Highwoods’ share of equity from these tables will not equal Investments in Unconsolidated Affiliates on the Consolidated Balance Sheet due to various purchase accounting and related adjustments as well as negative investment balances reclassed to Liabilities, which are not reflected in the Joint Ventures’ stand-alone financial statements.


Highwoods Properties, Inc.		30		6/30/08

Unconsolidated Joint Ventures Income

For the Three Months Ended June 30, 2008

Dollars in thousands


			Venture’s Books
Joint Venture	Own %		Revenue		Operating Exp		Interest		Depr/Amort		Net Income/ (Loss)
Board of Trade Investment Co.	49.00	%	$	588	$	394	$	—	$	137	$	57
Dallas County Partners I, LP	50.00	%		2,890		1,720		774		512		(116	)
Dallas County Partners II, LP	50.00	%		1,704		967		409		216		112
Dallas County Partners III, LP	50.00	%		90		59		—		2		29
Fountain Three	50.00	%		2,006		963		532		454		57
RRHWoods, LLC	50.00	%		4,410		2,531		939		1,127		(187	)
Kessinger/Hunter, LLC	26.50	%		4,021		3,666		—		149		206
4600 Madison Associates, LP	12.50	%		1,249		585		235		408		21
Highwoods DLF 98/29, LP	22.80	%		4,879		1,740		1,205		1,313		621
Highwoods DLF 97/26 DLF 99/32, LP	42.93	%		4,017		1,459		1,072		1,000		486
Concourse Center Associates, LLC	50.00	%		492		141		160		76		115
Plaza Colonnade, LLC	50.00	%		2,410		851		961		547		51
Highwoods KC Glenridge Office, LP	40.00	%		885		390		208		161		126
Highwoods KC Glenridge Land, LP	40.00	%		—		3		—		—		(3	)
Highwoods KC Orlando, LLC	40.00	%		8,222		3,430		1,855		1,822		1,115
Highwoods DLF Forum, LLC	25.00	%		3,329		1,133		855		1,401		(60	)

Total			$	41,192	$	20,032	$	9,205	$	9,325	$	2,630


			Highwoods’ Share of Joint Venture
Joint Venture	Own %		Revenue		Operating Exp		Interest		Depr/Amort		Net Income/ (Loss)
Board of Trade Investment Co.	49.00	%	$	288	$	193	$	—	$	67	$	28
Dallas County Partners I, LP	50.00	%		1,445		860		387		256		(58	)
Dallas County Partners II, LP	50.00	%		852		483		205		108		56
Dallas County Partners III, LP	50.00	%		45		30		—		1		14
Fountain Three	50.00	%		1,003		482		266		227		28
RRHWoods, LLC	50.00	%		2,205		1,266		469		563		(93	)
Kessinger/Hunter, LLC	26.50	%		1,066		972		—		40		54
4600 Madison Associates, LP	12.50	%		156		73		30		51		2
Highwoods DLF 98/29, LP	22.81	%		1,113		397		275		300		141
Highwoods DLF 97/26 DLF 99/32, LP	42.93	%		1,725		627		460		429		209
Concourse Center Associates, LLC	50.00	%		246		70		80		38		58
Plaza Colonnade, LLC	50.00	%		1,205		425		480		273		27
Highwoods KC Glenridge Office, LP	40.00	%		354		156		83		64		51
Highwoods KC Glenridge Land, LP	40.00	%		—		1		—		—		(1	)
Highwoods KC Orlando, LLC	40.00	%		3,289		1,372		742		729		446
Highwoods DLF Forum, LLC	25.00	%		833		283		214		350		(14	)

Total 1/ 2/			$	15,825	$	7,690	$	3,691	$	3,496	$	948

Highwoods’ share of Depreciation and Amortization from these tables will not equal Depreciation and Amortization of Real Estate Assets for Unconsolidated Affiliates on the Statement of Funds from Operations due to various purchase accounting and related adjustments, which are not reflected in the Joint Ventures’ stand-alone financial statements.

2/	Highwoods’ share of Net Income from these tables will not equal Equity in Earnings of Unconsolidated Affiliates on the Consolidated Income Statement due to various purchase accounting and related adjustments, which are not reflected in the Joint Ventures’ stand-alone financial statements.


Highwoods Properties, Inc.		31		6/30/08

Unconsolidated Joint Ventures Income

For the Six Months Ended June 30, 2008

Dollars in thousands


			Venture’s Books
Joint Venture	Own %		Revenue		Operating Exp		Interest		Depr/Amort		Net Income/ (Loss)
Board of Trade Investment Co.	49.00	%	$	1,169	$	801	$	—	$	282	$	86
Dallas County Partners I, LP	50.00	%		5,766		3,464		1,550		984		(232	)
Dallas County Partners II, LP	50.00	%		3,507		1,782		829		432		464
Dallas County Partners III, LP	50.00	%		138		117		—		3		18
Fountain Three	50.00	%		4,403		1,985		1,065		939		414
RRHWoods, LLC	50.00	%		8,875		5,135		1,914		2,150		(324	)
Kessinger/Hunter, LLC	26.50	%		8,139		7,264		—		300		575
4600 Madison Associates, LP	12.50	%		2,494		1,175		468		803		48
Highwoods DLF 98/29, LP	22.80	%		9,584		3,269		2,480		2,589		1,246
Highwoods DLF 97/26 DLF 99/32, LP	42.93	%		8,236		2,841		2,148		1,805		1,442
Concourse Center Associates, LLC	50.00	%		983		270		321		154		238
Plaza Colonnade, LLC	50.00	%		4,888		1,772		1,928		1,094		94
Highwoods KC Glenridge Office, LP	40.00	%		1,712		764		417		315		216
Highwoods KC Glenridge Land, LP	40.00	%		—		5		—		—		(5	)
Highwoods KC Orlando, LLC	40.00	%		16,495		6,686		3,717		3,727		2,365
Highwoods DLF Forum, LLC	25.00	%		3,331		1,133		855		1,401		(58	)

Total			$	79,720	$	38,463	$	17,692	$	16,978	$	6,587


			Highwoods’ Share of Joint Venture
Joint Venture	Own %		Revenue		Operating Exp		Interest		Depr/Amort		Net Income/ (Loss)
Board of Trade Investment Co.	49.00	%	$	573	$	392	$	—	$	138	$	43
Dallas County Partners I, LP	50.00	%		2,883		1,732		775		492		(116	)
Dallas County Partners II, LP	50.00	%		1,754		891		415		216		232
Dallas County Partners III, LP	50.00	%		69		59		—		2		8
Fountain Three	50.00	%		2,202		993		533		470		206
RRHWoods, LLC	50.00	%		4,438		2,568		957		1,075		(162	)
Kessinger/Hunter, LLC	26.50	%		2,157		1,925		—		80		152
4600 Madison Associates, LP	12.50	%		312		147		59		100		6
Highwoods DLF 98/29, LP	22.81	%		2,186		746		566		591		283
Highwoods DLF 97/26 DLF 99/32, LP	42.93	%		3,536		1,220		922		775		619
Concourse Center Associates, LLC	50.00	%		492		135		161		77		119
Plaza Colonnade, LLC	50.00	%		2,444		886		964		547		47
Highwoods KC Glenridge Office, LP	40.00	%		685		306		167		126		86
Highwoods KC Glenridge Land, LP	40.00	%		—		2		—		—		(2	)
Highwoods KC Orlando, LLC	40.00	%		6,598		2,674		1,487		1,491		946
Highwoods DLF Forum, LLC	25.00	%		833		283		214		350		(14	)

Total 1/ 2/			$	31,162	$	14,959	$	7,220	$	6,530	$	2,453

2/	Highwoods’ share of Net Income from these tables will not equal Equity in Earnings of Unconsolidated Affiliates on the Consolidated Income Statement due to various purchase accounting and related adjustments, which are not reflected in the Joint Ventures’ stand-alone financial statements.


Highwoods Properties, Inc.		32		6/30/08

Joint Ventures Long-Term Debt Detail 1/

Dollars in thousands


Joint Venture	Own %		Lender	Interest Rate		Maturity Date	Loan Balance 6/30/08
Dallas County Partners I, LP	50.0	%	Massachusetts Mutual Life Ins. Co.	6.19	%	Aug-18	$	41,656
Dallas County Partners I, LP	50.0	%	Regions	6.30	%	Jun-14		3,447
Dallas County Partners I, LP	50.0	%	Thrivent	8.45	%	Aug-10		1,567
Dallas County Partners I, LP	50.0	%	Bankers Trust	8.00	%	Jul-11		1,151
Dallas County Partners I, LP	50.0	%	Sun Life	5.92	%	Feb-16		1,028

				6.31	%			48,849

Dallas County Partners II, LP	50.0	%	Principal Life Insurance Company	10.19	%	Jun-13		15,734

Fountain Three	50.0	%	Massachusetts Mutual Life Ins. Co.	6.19	%	Aug-18		16,626
Fountain Three	50.0	%	Thrivent	7.00	%	Sep-12		5,194
Fountain Three	50.0	%	Thrivent	6.01	%	Oct-10		3,676
Fountain Three	50.0	%	Thrivent	6.01	%	Apr-09		3,676
Fountain Three	50.0	%	Lehman Brothers	8.02	%	Jul-09		3,466

				6.47	%			32,638

RRHWoods, LLC	50.0	%	Bank of America	6.80	%	Sep-12		26,273
RRHWoods, LLC	50.0	%	Industrial Revenue Bonds /2	2.96	%	Nov-15		23,000
RRHWoods, LLC	50.0	%	Massachusetts Mutual Life Ins. Co.	5.85	%	Mar-16		8,438
RRHWoods, LLC	50.0	%	Industrial Revenue Bonds /2	2.93	%	Sep-15		6,000
RRHWoods, LLC	50.0	%	Industrial Revenue Bonds /2	2.97	%	Nov-15		5,500
RRHWoods, LLC	50.0	%	Massachusetts Mutual Life Ins. Co.	6.19	%	Aug-18		4,600
RRHWoods, LLC	50.0	%	UNUM Life Insurance Company	5.67	%	Mar-17		3,974
RRHWoods, LLC	50.0	%	Regions	6.30	%	Jun-14		3,447

				4.96	%			81,232

Plaza Colonnade, LLC	50.0	%	Met Life	5.72	%	Jan-17		47,941
Plaza Colonnade, LLC	50.0	%	Tax Incremental Financing	5.90	%	Mar-24		11,903
Plaza Colonnade, LLC	50.0	%	Tax Incremental Financing	6.00	%	Mar-16		4,394
Plaza Colonnade, LLC	50.0	%	Tax Incremental Financing	5.38	%	Mar-10		1,818

				5.76	%			66,056

Highwoods KC Orlando, LLC	40.0	%	Met Life	5.21	%	Jul-14		140,727
Highwoods DLF Forum, LLC	25.0	%	Jackson National Life Insurance Company	5.13	%	Nov-13		67,500
Highwoods DLF 97/26 DLF 99/32, LP	42.9	%	Massachusetts Mutual Life Ins. Co.	7.66	%	May-12		55,340
Highwoods DLF 98/29, LP	22.8	%	USG Annuity & Life Company	6.78	%	Apr-11		47,610
Highwoods DLF 98/29, LP	22.8	%	Goldman Sachs	6.11	%	Jul-17		27,650
Highwoods KC Glenridge Office	40.0	%	Wachovia	4.84	%	Jun-14		16,479
4600 Madison Associates, LLC	12.5	%	State Farm	6.85	%	Apr-18		13,100
Concourse Center Associates, LLC	50.0	%	Lincoln National Life Insurance Co.	6.95	%	Jul-10		8,797

				5.90	%			377,203

				5.93	%		$	621,712

Highwoods’ share of the above							$	248,972

1/	Excludes loans related to two “consolidated” joint ventures.

2/	Floating rate loan based on market rates.


Highwoods Properties, Inc.		33		6/30/08

Joint Ventures Portfolio Summary

As of June 30, 2008

Summary by Location:


Market	Rentable Square Feet	Occupancy		Percentage of Annualized Cash Revenue Highwoods’ Share Only 1/

				Office		Industrial		Retail		Multi-Family		Total
Des Moines 2/	2,505,000	88.5	%	27.0	%	4.1	%	0.9	%	3.1	%	35.1	%
Orlando	1,854,000	89.8	%	27.8	%	—		—		—		27.8	%
Atlanta	835,000	94.7	%	12.3	%	—		—		—		12.3	%
Kansas City	714,000	83.0	%	8.2	%	—		—		—		8.2	%
Raleigh	814,000	88.5	%	6.2	%	—		—		—		6.2	%
Richmond	413,000	100.0	%	4.9	%	—		—		—		4.9	%
Piedmont Triad	364,000	72.1	%	2.4	%	—		—		—		2.4	%
Tampa	205,000	98.8	%	1.9	%	—		—		—		1.9	%
Charlotte	148,000	100.0	%	0.7	%	—		—		—		0.7	%
Other	110,000	100.0	%	0.5	%	—		—		—		0.5	%

Total 3/	7,962,000	89.5	%	91.9	%	4.1	%	0.9	%	3.1	%	100.0	%

1/	Annualized Cash Revenue is June, 2008 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line rental income) multiplied by 12.

2/	Excludes 418 apartment units and related occupancy percentage of 91.9%.

3/	Includes 618,000 square feet of properties in joint ventures that are consolidated.


Highwoods Properties, Inc.		34		6/30/08

Joint Ventures Lease Expirations

June 30, 2008

Dollars in thousands


Year	Rentable Square Feet Expiring 1/	Percent of Rentable Square Feet 1/		Annualized Cash Revenue 2/		Average Rental Rate		Percent of Annualized Cash Revenue 2/
Total
2008	557,604	7.8	%	$	9,343	$	16.76	6.6	%
2009	859,240	12.1	%		16,318		18.99	11.6	%
2010	790,996	11.1	%		15,175		19.18	10.7	%
2011	1,063,452	14.9	%		21,523		20.24	15.2	%
2012	599,671	8.4	%		12,587		20.99	8.9	%
2013	1,149,165	16.1	%		23,573		20.51	16.7	%
2014	538,493	7.6	%		12,099		22.47	8.6	%
2015	680,293	9.5	%		12,403		18.23	8.8	%
2016	39,470	0.6	%		1,011		25.61	0.7	%
2017	518,326	7.3	%		11,521		22.23	8.2	%
2018 and thereafter	330,159	4.6	%		5,667		17.16	4.0	%

	7,126,869	100.0	%	$	141,220	$	19.82	100.0	%

1/	Includes square feet expiring in properties in joint ventures that are consolidated.

2/	Annualized Cash Revenue is June, 2008 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line rental income) multiplied by 12.


Highwoods Properties, Inc.		35		6/30/08

Joint Venture Acquisition and Disposition Activity

Dollars in thousands

Acquisitions


Name	Market	Type	Date Acquired	Square Footage	Total Cost 2/
First quarter 2008:
None

Second quarter 2008:
Forum	Raleigh	O	04/03/08	635,000	$	28,000

Dispositions

Name

Market

Type

Date
Sold

Square
Footage

Occupancy

Gross Sales
Price

First quarter 2008:

None

Second quarter 2008:

None

1/	The letters “O” represents Office.

2/	Reflects Highwoods pro-rata share only.


Highwoods Properties, Inc.		36		6/30/08