First Quarter Report

Quarter ended March 31, 2012

Three Eldridge Place in Houston, Texas

First Quarter Overview

·

Occupancy at the end of the first quarter of 2012 was 85%, an increase from 84% at the end of 2011.

·

890,000 square feet of leases were executed during the first quarter of 2012, including 465,000 square feet of renewals (representing a 66% renewal rate), 202,000 square feet of expansions, and 223,000 square feet of new leases. Net absorption was 184,000 square feet.

·

Two properties were transferred to their respective lenders pursuant to foreclosures resulting in an aggregate gain on troubled debt restructuring of $3.6 million and a gain on transfer of assets of $2.4 million during the first quarter of 2012. Collectively, these properties represented approximately 396,000 square feet, or approximately 1.9% of the Company’s net rentable square footage at year end 2011.

·

The Company’s advisor waived $1.1 million of asset management fees for the first quarter of 2012, which brings the total of fees waived since the second quarter of 2009 to $23.6 million.

Financial Highlights

(in thousands, except per share data)

3 mos. ended

3 mos. ended

Some numbers have been rounded for presentation purposes.

Mar. 31, 2012

Mar. 31, 2011

Modified FFO attributable to common stockholders

$

7,520

$

11,373

Basic and diluted Modified FFO, per common share

$

0.03

$

0.04

Distributions declared on common shares

$

7,439

$

7,389

Distributions declared per share

$

0.025

$

0.025

(in thousands)

As of Mar. 31, 2012

Total assets

$

3,496,919

Total liabilities

$

2,568,411

Investor Information

A copy of the Company’s Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission, is available without charge at sec.gov or by written request to the Company at its corporate headquarters. For additional information about Behringer Harvard and its investment programs, please contact us at 866.655.3650.

3 mos. ended

3 mos. ended

(in thousands, except per share data)

Mar. 31, 2012

Mar. 31, 2011

Net loss

$

(27,840

)

$

(30,483

)

Net loss attributable to noncontrolling interests

41

172

Real estate depreciation and amortization from consolidated properties

50,688

60,858

Real estate depreciation and amortization from unconsolidated properties

1,989

1,720

Gain on sale or transfer of depreciable real estate

(2,381

)

(639

)

Noncontrolling interests share of above adjustments

(253

)

(313

)

FFO attributable to common stockholders

22,244

31,315

Acquisition expenses

—

35

Straight-line rent adjustment

(7,618

)

(6,498

)

Amortization of above- and below-market rents, net

(3,540

)

(10,372

)

Gain on troubled debt restructuring

(3,587

)

(3,136

)

Noncontrolling interest share of above adjustments

21

29

MFFO attributable to common stockholders

$

 7,520

$

11,373

Weighted average common shares outstanding–basic

297,646

295,643

Weighted average common shares outstanding–diluted

297,659

295,643

Net loss per common share–basic and diluted

$

(0.09

)

$

(0.10

)

FFO per common share–basic and diluted

$

0.07

$

0.11

MFFO per common share–basic and diluted

$

0.03

$

0.04