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  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>UNITED STATES</b></p>
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>SECURITIES AND EXCHANGE COMMISSION</b></p>
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>Washington, D.C. 20549</p>
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b><u>__________________________</u></b></p>
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>FORM 8-K</b></p>
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>Current Report</p>
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>Pursuant to Section 13 or 15(d) of the Securities
  Exchange Act of 1934</p>
  
  
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>Date of Report (date of earliest event reported):&nbsp; N/A</p>
  
  
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b><u>PARKWAY PROPERTIES, INC</u></b><u>.</u></p>
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>(Exact Name of Registrant as Specified in its Charter)</p>
  
  
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  
  
  <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Maryland</u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>1-11533</u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>74-2123597</u></p>
  
  <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">&nbsp;&nbsp;&nbsp; (State or Other
  Jurisdiction &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Commission File Number) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (IRS
  Employer</p>
  
  <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; of Incorporation)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Identification
  No.)</p>
  
  
  
  <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">&nbsp;</p>
  
  
  
  <p class=MsoNormal align=center style='margin-left:4.5pt;text-align:center; margin-top:0; margin-bottom:0'><u>One Jackson Place, Suite 1000, 188 East Capitol
  Street, Jackson, MS 39225-4647</u></p>
  
  <p class=MsoNormal align=center style='margin-left:4.5pt;text-align:center; margin-top:0; margin-bottom:0'>(Address of Principal Executive Offices, including zip
  code)</p>
  
  
  
  <p class=MsoNormal align=center style='margin-left:4.5pt;text-align:center; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><u>(601) 948-4091</u></p>
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>(Registrant's telephone number, including area code)</p>
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <p class=MsoNormal align=center style='margin-left:4.5pt;text-align:center; margin-top:0; margin-bottom:0'><u>Not Applicable</u></p>
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>(Former name or former address, if changed since last
  report)</p>
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <p class=MsoNormal style='text-indent:.5in; margin-top:0; margin-bottom:0'>Check
  the appropriate box below if the Form 8-K filing is intended to simultaneously
  satisfy the filing obligation of the registrant under any of the following
  provisions (see General Instruction A.2. below):</p>
  
  
  
  <p class=MsoNormal style='text-indent:.5in; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <p class=MsoNormal style='margin-left:.5in;text-indent:-.5in; margin-top:0; margin-bottom:0'>&#61551;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Written
  communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</p>
  
  <p class=MsoNormal style='margin-left:.5in;text-indent:-.5in; margin-top:0; margin-bottom:0'>&#61551;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Soliciting
  material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</p>
  
  <p class=MsoNormal style='margin-left:.5in;text-indent:-.5in; margin-top:0; margin-bottom:0'>&#61551;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pre-commencement
  communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
  240.14d-2(b))</p>
  
  <p class=MsoNormal style='margin-left:.5in;text-indent:-.5in; margin-top:0; margin-bottom:0'>&#61551;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pre-commencement
  communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
  240.13e-4(c))</p>
  
  
  
  <hr color="#000080">
  <p style="margin-top: 0; margin-bottom: 0"><br clear=all
  style='page-break-before:always'>
  
  
  </p>
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>FORM 8-K<br>
  <br>
  PARKWAY PROPERTIES, INC.</b></p>
  
  <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><br>
  Item 8.01. Other Events.</b></p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><b><br>
  </b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
  August 24, 2004, Parkway Properties, Inc. (&quot;Parkway&quot;) purchased Squaw Peak Corporate Center, a 287,000
  square foot, two-building office campus in the Camelback/Squaw Peak submarket
  of Phoenix, Arizona from an unrelated party.&nbsp; The property was acquired
  for $46.9 million plus $2.7 million in closing costs and anticipated capital
  expenditures and leasing commissions during the first two years of ownership.&nbsp;
  The purchase was funded with the Company's existing lines of credit and the
  assumption of an existing first mortgage of $33.8 million.&nbsp; The mortgage matures
  in December 2010 and bears interest at 8.16%.&nbsp; In accordance with generally
  accepted accounting principles, the mortgage was recorded at $39.6 million to
  reflect the fair value of the financial instrument based on the rate of 4.92%
  on the date of purchase.&nbsp; </p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Squaw
  Peak Corporate Center also includes two adjoining two-story parking decks
  containing 518 spaces, 122 covered spaces and a surface parking lot containing
  792 parking spaces.&nbsp; On the date of purchase, the property was 92% leased to multiple
  customers including Aetna, URS Greiner Woodward, a global engineering firm,
  Chubb, MetLife, ING and Fidelity National Title.</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  <hr color="#000080">
  <p style="margin-top: 0; margin-bottom: 0"><br clear=all
  style='page-break-before:always'>
  <b>Item 9.01.&nbsp; Financial Statements and
  Exhibits.</b></p>
  <p style="margin-top: 0; margin-bottom: 0">&nbsp;</p>
  <p style="margin-top: 0; margin-bottom: 0"></p>
  
  
  
  <table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0 width=660
   style='width:495.05pt;border-collapse:collapse' bordercolorlight="#FFFFFF" bordercolordark="#FFFFFF">
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Financial
    Statements</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
    following audited financial statement of Squaw Peak for the year ended December 31, 2003 is attached
    hereto.&nbsp; Also included is the unaudited financial statement for the six
    months ended June 30, 2004:</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=55 valign=top style='width:41.35pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'><b>Page</b></p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Report
    of Independent Auditors</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>4</p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Statements
    of Rental Revenues and Direct Operating Expenses</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>5</p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notes
    to Statements of Rental Revenues and Direct Operating Expenses</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>6</p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
    following unaudited Pro Forma Consolidated Financial Statements of Parkway
    for the year ended December 31, 2003 and the six months ended June 30, 2004 are
    attached hereto:</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=55 valign=top style='width:41.35pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'><b>Page</b></p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro
    Forma Consolidated Financial Statements (Unaudited)</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>8</p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro
    Forma Consolidated Balance Sheet (Unaudited) - As of June 30, 2004</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>9</p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro
    Forma Consolidated Statement of Income (Unaudited) - </p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
    the Year Ended December 31, 2003</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>10</p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro
    Forma Consolidated Statement of Income (Unaudited) -</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
    the Six Months Ended June 30, 2004</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>11</p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notes
    to Pro Forma Consolidated Financial Statements (Unaudited)</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>12</p>
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    &nbsp;</td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
    &nbsp;</td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Exhibits</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1&nbsp;&nbsp;&nbsp;&nbsp;Consent
    of Ernst &amp; Young LLP</p>
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=605 valign=top style='width:453.7pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=55 valign=top style='width:41.35pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
  </table>
  
  <b><hr color="#000080">
  <p style="margin-top: 0; margin-bottom: 0"><br clear=all
  style='page-break-before:always'>
  </b>
  
  </p>
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>&nbsp;Report of Independent Auditors</b></p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  <br>
  The Board of Directors</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>Parkway Properties, Inc.</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  We have audited the accompanying statement of rental revenues and direct
  operating expenses of Squaw Peak Corporate
   Center (&quot;Squaw Peak&quot;) for the year ended December 31, 2003.&nbsp; This statement is the responsibility of
  management.&nbsp; Our responsibility is to express an opinion on this statement
  based on our audit.</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  We conducted our audit in accordance with auditing standards of the Public
  Company Accounting Oversight Board (United States).&nbsp; Those standards require that we plan and perform the
  audit to obtain reasonable assurance about whether the statement of rental
  revenues and direct operating expenses is free of material misstatement.&nbsp; An
  audit includes examining, on a test basis, evidence supporting the amounts and
  disclosures in the statement.&nbsp; An audit also includes assessing the basis of
  accounting and accounting principles used and significant estimates made by
  management, as well as evaluating the overall statement presentation.&nbsp; We
  believe that our audit provides a reasonable basis for our opinion.</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  The accompanying statements were prepared for the purpose of complying with the
  rules and regulations of the Securities and Exchange Commission, as described
  in Note 2, for inclusion in a Form 8-K of Parkway Properties, Inc. and are not
  intended to be a complete presentation of Squaw Peak's revenues and expenses. </p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  In our opinion, the statement of rental revenues and direct operating expenses
  referred to above presents fairly, in all material respects, the rental
  revenues and direct operating expenses described in Note 2 of Squaw Peak for
  the year ended December
   31, 2003, in
  conformity with accounting principles generally accepted in the United States.</p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>The accompanying financial statements for 2004 were not
  audited by us and, accordingly, we do not express an opinion on them.</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  <br>
  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  Ernst &amp; Young LLP</p>
  
  <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">New
  Orleans, Louisiana</p>
  
  <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">October
   7, 2004</p>
  
  <hr color="#000080">
  <p style="margin-top: 0; margin-bottom: 0"><br clear=all style='page-break-before:always'>
  
  
  </p>
  
  
  <p class=MsoEndnoteText align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'><b>Squaw Peak<br>
  <br>
  Statements of Rental Revenues<br>
  and Direct Operating Expenses</b></p>
  
  <p class=MsoEndnoteText align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'>(in thousands)</p>
  
  <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b><br>
  <br>
  </b></p>
  
  <div align=center>
  
  <table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0 width=678
   style='width:508.3pt;border-collapse:collapse' bordercolorlight="#FFFFFF" bordercolordark="#FFFFFF">
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'><b>Year Ended</b></p>
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'><b>Six Months
    Ended</b></p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
    <td width=145 valign=top style='width:108.75pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'><b>December 31, 2003</b></p>
    </td>
    <td width=164 valign=top style='width:123.3pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'><b>June 30, 2004</b></p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=145 valign=top style='width:108.75pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=164 valign=top style='width:123.3pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'>(unaudited)</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>Rental revenues:</p>
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Minimum
    rents </p>
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;5,344</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;2,822</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reimbursed
    charges </p>
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>261</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>63</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other
    income</p>
    </td>
    <td width=145 valign=top style='width:108.75pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>188</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>87</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=145 valign=top style='width:108.75pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>5,793</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>2,972</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>Direct operating expenses:</p>
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Administrative
    and miscellaneous expenses</p>
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>79</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>20</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Salaries
    and wages</p>
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>120</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>60</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Utilities</p>
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>387</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>190</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Janitorial
    services and supplies</p>
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>177</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>109</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Maintenance
    services and supplies</p>
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>146</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>80</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Security</p>
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>33</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>17</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Management
    fees</p>
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>347</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>163</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Real
    estate taxes</p>
    </td>
    <td width=145 valign=top style='width:108.75pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>752</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>385</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=145 valign=top style='width:108.75pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>2,041</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>1,024</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;border:none;border-bottom:
    double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>Excess of rental revenues over
    direct operating expenses</p>
    </td>
    <td width=145 valign=top style='width:108.75pt;border:none;border-bottom:
    double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:31.85pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;3,752</p>
    </td>
    <td width=164 valign=top style='width:123.3pt;border:none;border-bottom:double windowtext 1.5pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:38.15pt;text-align:right;
    line-height:-100%; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;1,948</p>
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=145 valign=top style='width:108.75pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=164 valign=top style='width:123.3pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=368 valign=top style='width:276.25pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=145 valign=top style='width:108.75pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=164 valign=top style='width:123.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
  </table>
  
  </div>
  
  <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'>
  <br>
  <br>
  <i>See report of
  independent auditors and accompanying notes.</i></p>
  
  
  
  <hr color="#000080">
  <p style="margin-top: 0; margin-bottom: 0" align="center"><br clear=all style='page-break-before:always'>
  <b>Squaw Peak<br>
  <br>
  Notes to Statements of Rental Revenues<br>
  and Direct Operating Expenses<br>
  </b><br>
  <b>December 31, 2003 and June 30, 2004</b></p>
  <p style="margin-top: 0; margin-bottom: 0" align="center"></p>
  
  <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><br>
  <br>
  <b>1.&nbsp;&nbsp;&nbsp;&nbsp;Organization and Significant Accounting Policies</b></p>
  
  <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><br>
  <b>Description of Property</b></p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  On August 24, 2004, Parkway Properties, Inc. (&quot;Parkway&quot;) purchased Squaw Peak, a two-building office campus located in the
  Camelback/Squaw Peak submarket of Phoenix, Arizona
  from an unrelated party. Squaw Peak contains approximately 287,000
  (unaudited) net rentable square feet of office space.&nbsp; The acquisition also
  includes two adjoining two-story parking decks containing 518 spaces, 122
  covered spaces and a surface parking lot containing 792 parking spaces.</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <br>
  <b>Management's Use of Estimates</b></p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>The preparation of financial statements in conformity
  with accounting principles generally accepted in the United States requires
  management to make estimates and assumptions that affect the reported amounts
  of revenues and expenses during the reporting period.&nbsp; Actual results could
  differ from those estimates.</p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><b>Rental
  Revenue</b></p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  Minimum rents from leases
  are accounted for ratably over the term of each lease.&nbsp; Tenant reimbursements
  are recognized as revenue as the applicable services are rendered or expenses
  incurred.</p>
  
  <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><br>
  The future minimum rents for Squaw Peak's non-cancelable operating
  leases at December
   31, 2003 are as
  follows (in thousands):<br>
  <br>
  </p>
  
  <div align=center>
  
  <table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0
   style='border-collapse:collapse' bordercolorlight="#FFFFFF" bordercolordark="#FFFFFF">
   <tr>
    <td width=87 valign=top style='width:65.2pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Year</b></p>
    </td>
    <td width=77 valign=top style='width:57.8pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Amount</b></p>
    </td>
   </tr>
   <tr>
    <td width=87 valign=top style='width:65.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>2004</p>
    </td>
    <td width=77 valign=top style='width:57.8pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;5,400</p>
    </td>
   </tr>
   <tr>
    <td width=87 valign=top style='width:65.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>2005</p>
    </td>
    <td width=77 valign=top style='width:57.8pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>5,920</p>
    </td>
   </tr>
   <tr>
    <td width=87 valign=top style='width:65.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>2006</p>
    </td>
    <td width=77 valign=top style='width:57.8pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>4,608</p>
    </td>
   </tr>
   <tr>
    <td width=87 valign=top style='width:65.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>2007</p>
    </td>
    <td width=77 valign=top style='width:57.8pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>3,462</p>
    </td>
   </tr>
   <tr>
    <td width=87 valign=top style='width:65.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>2008</p>
    </td>
    <td width=77 valign=top style='width:57.8pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>2,925</p>
    </td>
   </tr>
   <tr>
    <td width=87 valign=top style='width:65.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>Thereafter</p>
    </td>
    <td width=77 valign=top style='width:57.8pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>1,022</p>
    </td>
   </tr>
   <tr>
    <td width=87 valign=top style='width:65.2pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=77 valign=top style='width:57.8pt;border:none;border-bottom:double windowtext 2.25pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <div style="border-bottom-style: double; border-bottom-width: 3">
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>$23,337</p>
    </div>
    </td>
   </tr>
  </table>
  
  </div>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  The above amounts do not include tenant reimbursements for utilities, taxes,
  insurance and common area maintenance.</p>
  
  
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><i>See report of independent auditors.</i></p>
  
  
  
  <hr color="#000080">
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  As of December 31,
   2003, Squaw Peak had six customers including Aetna, URS Greiner
  Woodward, Entranco, Inc., Century Title Agency, Inc., CMX, LLC and Associated
  Asset Management, Inc. that occupied approximately 66% of the office space.</p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><b>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basis of Accounting</b></p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  The accompanying statements of rental revenues and direct operating expenses
  are presented on the accrual basis.&nbsp; The statements have been prepared in
  accordance with the applicable rules and regulations of the Securities and
  Exchange Commission for real estate properties acquired.&nbsp; Accordingly, the
  statements exclude certain expenses not comparable to the future operations of Squaw Peak such as depreciation and mortgage interest expense.&nbsp; Management
  is not aware of any material factors relating to Squaw Peak that
  would cause the reported financial information not to be necessarily indicative
  of future operating results.</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  <b>3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Management Fees</b></p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  Management fees of approximately 6% of revenues received from the operations of
  Squaw Peak were paid to an unrelated management company.</p>
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><i>See report of independent auditors.</i></p>
  
  
  
  <hr color="#000080">
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>PARKWAY PROPERTIES, INC.</b></p>
  
  <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b>&nbsp;</b></p>
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Pro Forma Consolidated Financial Statements</b></p>
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>(Unaudited)</p>
  
  <p class=MsoEndnoteText style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  <br>
  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following unaudited pro forma
  consolidated balance sheet as of June 30, 2004 and pro forma consolidated
  statements of income of Parkway Properties, Inc. (&quot;Parkway&quot;) for the
  year ended December 31, 2003 and six months ended June 30, 2004 give effect to
  the purchases by Parkway of certain properties listed below for the periods
  stated.&nbsp; The pro forma consolidated financial statements have been prepared by
  management of Parkway based upon the historical financial statements of Parkway
  and the adjustments and assumptions in the accompanying notes to the pro forma
  consolidated financial statements.</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The pro forma consolidated balance
  sheet sets forth the effect of Parkway's purchase of the Squaw Peak Corporate
  Center (&quot;Squaw Peak&quot;) as if it had been consummated on June 30, 2004.</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The pro forma consolidated statements
  of income set forth the effects of Parkway's purchases of the buildings listed
  below as if each had been consummated on January 1, 2003.&nbsp; </p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <div align=center>
  
  <table class=MsoTableGrid border=1 cellspacing=0 cellpadding=0
   style='border-collapse:collapse' bordercolorlight="#FFFFFF" bordercolordark="#FFFFFF">
   <tr>
    <td width=211 valign=top style='width:158.6pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Building</b></p>
    </td>
    <td width=128 valign=top style='width:96.25pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><b>Date of Purchase</b></p>
    </td>
   </tr>
   <tr>
    <td width=211 valign=top style='width:158.6pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>Maitland 200</p>
    </td>
    <td width=128 valign=top style='width:96.25pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>01/29/04</p>
    </td>
   </tr>
   <tr>
    <td width=211 valign=top style='width:158.6pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>Capital City Plaza</p>
    </td>
    <td width=128 valign=top style='width:96.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>04/02/04</p>
    </td>
   </tr>
   <tr>
    <td width=211 valign=top style='width:158.6pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>Squaw Peak</p>
    </td>
    <td width=128 valign=top style='width:96.25pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>08/24/04</p>
    </td>
   </tr>
  </table>
  
  </div>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These pro forma consolidated
  financial statements may not be indicative of the results that actually would
  have occurred if the transactions had occurred on the dates indicated or which
  may be obtained in the future.&nbsp; The pro forma consolidated financial statements
  should be read in conjunction with the consolidated financial statements and
  notes of Parkway included in its annual report on Form 10-K for the year ended
  December 31, 2003.</p>
  
  
  
  <hr color="#000080">
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <p style="margin-top: 0; margin-bottom: 0">
  
  
  
  <br
  clear=all style='page-break-before:always'>
  
  
  </p>
  
  
  <h1 align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>
  <font size="2">PARKWAY PROPERTIES, INC.
  AND SUBSIDIARIES<br>
  PRO
  FORMA CONSOLIDATED BALANCE SHEET<br>
  JUNE 30, 2004<br>
  </font>
  </b><font size="2">(Unaudited)</font><b><font size="2"><br>
  &nbsp;</font></b></h1>
  
  <div align=center>
  
  <table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0 width=707
   style='width:100%;border-collapse:collapse' bordercolorlight="#FFFFFF" bordercolordark="#FFFFFF">
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><font size="2">&nbsp;</font></b></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>
    <font size="2">Parkway</font></b></p>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>
    <font size="2">Historical</font></b></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>
    <font size="2">Pro Forma</font></b></p>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>
    <font size="2">Adjustments (1)</font></b></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>
    <font size="2">Parkway</font></b></p>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>
    <font size="2">Pro Forma</font></b></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><font size="2">&nbsp;</font></b></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><font size="2">&nbsp;</font></b></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>
    <font size="2">(In thousands)</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><font size="2">&nbsp;</font></b></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><font size="2">Assets</font></b></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><font size="2">&nbsp;</font></b></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'><b>
    <font size="2">&nbsp;</font></b></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'><b>
    <font size="2">&nbsp;</font></b></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Real
    estate related investments:</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><font size="2">&nbsp;</font></b></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'><b>
    <font size="2">&nbsp;</font></b></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><font size="2">&nbsp;</font></b></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Office
    and parking properties</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;990,733&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;52,641&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$1,043,374&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Parking
    development</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">302&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">302&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accumulated
    depreciation</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">(131,679)</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">(131,679)</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">859,356&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">52,641&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">911,997&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Land
    held for sale</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">3,528&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">3,528&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investment
    in unconsolidated joint ventures</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">19,997&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">19,997&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">882,881&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">52,641&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">935,522&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Interest,
    rents receivable and other assets</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">45,153&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">45,153&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Cash
    and cash equivalents</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">1,742&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">1,742&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.8pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;929,776&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;52,641&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;982,417&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><font size="2">Liabilities</font></b></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Notes
    payable to banks</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;129,161&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;13,037&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;142,198&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Mortgage
    notes payable without recourse</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">326,315&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">39,604&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">365,919&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Accounts
    payable and other liabilities</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">38,458&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">38,458&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.8pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">493,934&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">52,641&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">546,575&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><font size="2">Minority
    Interest</font></b></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Minority
    interest - unit holders</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">40&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">40&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Minority
    interest - real estate partnerships</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">3,774&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">3,774&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><font size="2">&nbsp;</font></b></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">3,814&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">3,814&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b><font size="2">Stockholders'
    Equity</font></b></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">8.34%
    Series B Cumulative Convertible Preferred</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;stock,
    $.001 par value, 2,142,857 shares authorized, </font> </p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,867,857
    shares issued and outstanding</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">65,375&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">65,375&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Series
    C Preferred stock, $.001 par value, 400,000 shares</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;authorized,
    no shares issued</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">8.00%
    Series D Preferred stock, $.001 par value,</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,400,000
    shares authorized, issued and outstanding</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">57,976&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">57,976&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Preferred
    membership interests</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">15,491&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">15,491&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Common
    stock, $.001 par value, 65,057,143 shares</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;authorized,
    11,278,470 shares issued and outstanding</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">11&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">11&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Excess
    stock, $.001 par value, 30,000,000 shares authorized,</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;no
    shares issued</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Common
    stock held in trust, at cost, 130,000 shares </font> </p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">(4,400)</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">(4,400)</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Additional
    paid-in capital</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">269,304&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">269,304&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Unearned
    compensation</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">(4,241)</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">(4,241)</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Accumulated
    other comprehensive income</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">166&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">166&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><font size="2">Retained
    earnings</font></p>
    </td>
    <td width=90 valign=top style='width:67.8pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">32,346&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">32,346&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.8pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">432,028&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">432,028&nbsp;</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=402 valign=top style='width:301.2pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=90 valign=top style='width:67.8pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;929,776&nbsp;</font></p>
    </td>
    <td width=125 valign=top style='width:93.9pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:16.95pt;text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;52,641&nbsp;</font></p>
    </td>
    <td width=90 valign=top style='width:67.2pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;982,417&nbsp;</font></p>
    </td>
   </tr>
  </table>
  
  </div>
  
  <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'><br>
  <br>
  <br>
  </p>
  
  <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'>See accompanying notes </p>
  
  <b><hr color="#000080">
  <p style="margin-top: 0; margin-bottom: 0"><br clear=all style='page-break-before:always'>
  </b>
  
  </p>
  
  <p class=MsoNormal align=center style='text-align:center;margin-top:0; margin-bottom:0'><b>PARKWAY PROPERTIES, INC. AND SUBSIDIARIES<br>
  PRO FORMA CONSOLIDATED STATEMENT OF INCOME<br>
  FOR THE YEAR ENDED DECEMBER
   31, 2003<br>
  </b>(Unaudited)</p>
  
  <p class=MsoNormal align=center style='text-align:center;margin-top:0; margin-bottom:0'><br>
  <br>
  </p>
  
  <div align=center>
  
  <table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0
   style='width:105%;border-collapse:collapse' bordercolorlight="#FFFFFF" bordercolordark="#FFFFFF">
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">&nbsp;</font></b></p>
    </td>
    <td valign=top style='width:71;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=center style='text-align:center;margin-top:0; margin-bottom:0'><b>
    <font size="2">Parkway </font> </b></p>
    <p class=MsoNormal align=center style='text-align:center;margin-top:0; margin-bottom:0'><b>
    <font size="2">Historical</font></b></p>
    </td>
    <td colspan=2 valign=top style='width:127;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=center style='text-align:center;margin-top:0; margin-bottom:0'><b>
    <font size="2">Pro Forma</font></b></p>
    <p class=MsoNormal align=center style='text-align:center;margin-top:0; margin-bottom:0'><b>
    <font size="2">Adjustments (2)</font></b></p>
    </td>
    <td colspan=2 valign=top style='width:107;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=center style='text-align:center;margin-top:0; margin-bottom:0'><b>
    <font size="2">Parkway</font></b></p>
    <p class=MsoNormal align=center style='text-align:center;margin-top:0; margin-bottom:0'><b>
    <font size="2">Pro Forma</font></b></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:379;border-bottom:
    1.0pt solid windowtext;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">&nbsp;</font></b></p>
    </td>
    <td colspan=5 valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:335;border-bottom:1.0pt solid windowtext;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=center style='text-align:center;margin-top:0; margin-bottom:0'>
    <font size="2">(In thousands, except per share
    data)</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">Revenues</font></b></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">&nbsp;</font></b></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">&nbsp;</font></b></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">&nbsp;</font></b></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">&nbsp;</font></b></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">&nbsp;</font></b></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Income from office and parking&nbsp; properties</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$142,196&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;18,127&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">(a)</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$160,323&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Management company income</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">2,136&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">2,136&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Interest on note receivable from Moore Building
    Associates LP</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">819&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">819&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Incentive management fee from Moore Building
    Associates LP</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">300&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">300&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Other income and deferred gains</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">599&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='width:38;border-top:medium none;border-left:
    medium none;border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">599&nbsp;</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:379;border-top:1.0pt solid windowtext;
    border-left:medium none;border-bottom:1.0pt solid windowtext;border-right:medium none;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Total Revenues</font></p>
    </td>
    <td valign=top style='border-right:1.0pt solid windowtext; border-top:1.0pt solid windowtext; border-bottom:1.0pt solid windowtext; width:71;border-left:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">146,050&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">18,127&nbsp;</font></p>
    </td>
    <td valign=top style='width:38;border-top:medium none;border-left:
    medium none;border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">164,177&nbsp;</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">Expenses</font></b></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Office and parking properties:</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating
    expense</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">63,362&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">7,788&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">(a)</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">71,150&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest
    expense:</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contractual</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">16,026&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">3,750&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">(c)</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">19,776&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization
    of loan costs</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">293&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">293&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation
    and amortization</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">28,030&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">3,643&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">(a)</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">31,673&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Operating expense for other real estate properties</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">37&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">37&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Interest expense on bank notes:</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contractual</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">2,834&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">1,355&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">(d)</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">4,189&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization
    of loan costs</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">565&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">565&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Management company expenses</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">391&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">391&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">General and administrative</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">4,201&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">4,201&nbsp;</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:379;border-top:1.0pt solid windowtext;
    border-left:medium none;border-bottom:1.0pt solid windowtext;border-right:medium none;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Total Expenses</font></p>
    </td>
    <td valign=top style='border-right:1.0pt solid windowtext; border-top:1.0pt solid windowtext; border-bottom:1.0pt solid windowtext; width:71;border-left:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">115,739&nbsp;</font></p>
    </td>
    <td valign=top style='width:75;border-top:1.0pt solid windowtext;
    border-left:medium none;border-bottom:1.0pt solid windowtext;border-right:medium none;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">16,536&nbsp;</font></p>
    </td>
    <td valign=top style='border-right:1.0pt solid windowtext; border-top:1.0pt solid windowtext; border-bottom:1.0pt solid windowtext; width:38;border-left:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">132,275&nbsp;</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">Income before equity in earnings,&nbsp; gain and minority
    interest</font></b></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">30,311&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">1,591&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">31,902&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Equity in earnings of unconsolidated joint ventures</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">2,212&nbsp;</font></p>
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">2,212&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Gain on sale of joint venture interest and real estate
    </font>
    </p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">10,661</font></p>
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:74;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">10,661&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:379;border-bottom:
    1.0pt solid windowtext;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Minority interest - unit holders</font></p>
    </td>
    <td valign=top style='width:71;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">(3)</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='width:38;border-top:medium none;border-left:
    medium none;border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">(3)</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:379;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">Net Income
    </font> </b></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">43,181&nbsp;</font></p>
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">1,591&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">44,772&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:379;border-bottom:
    1.0pt solid windowtext;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Change in market value of interest rate swap</font></p>
    </td>
    <td valign=top style='width:71;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">170&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='width:38;border-top:medium none;border-left:
    medium none;border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">170&nbsp;</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:379;border-bottom:
    1.0pt solid windowtext;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">Comprehensive income</font></b></p>
    </td>
    <td valign=top style='width:71;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;43,351&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;1,591&nbsp;</font></p>
    </td>
    <td valign=top style='width:38;border-top:medium none;border-left:
    medium none;border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;44,942&nbsp;</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:379;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">Net income available to common stockholders:</font></b></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Net income</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;43,181&nbsp;</font></p>
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;1,591&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;44,772&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Original issue costs associated with redemption or
    preferred stock</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">(2,619)</font></p>
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">(2,619)</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Dividends on preferred stock</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">(5,352)</font></p>
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">(1,084)</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">(e)</font></p>
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">(6,436)</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:379;border-bottom:
    1.0pt solid windowtext;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Dividends on convertible preferred stock</font></p>
    </td>
    <td valign=top style='width:71;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">(6,091)</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='width:38;border-top:medium none;border-left:
    medium none;border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">(6,091)</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:379;border-bottom:
    1.0pt solid windowtext;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">Net income available to common stockholders</font></b></p>
    </td>
    <td valign=top style='width:71;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;29,119&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;507&nbsp;</font></p>
    </td>
    <td valign=top style='width:38;border-top:medium none;border-left:
    medium none;border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;29,626&nbsp;</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:379;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">Net income per common share:</font></b></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:379;border-bottom:
    1.0pt solid windowtext;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Basic</font></p>
    </td>
    <td valign=top style='width:71;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.85&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='width:38;border-top:medium none;border-left:
    medium none;border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.90&nbsp;</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:379;border-bottom:
    1.0pt solid windowtext;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Diluted:</font></p>
    </td>
    <td valign=top style='width:71;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.79&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='width:38;border-top:medium none;border-left:
    medium none;border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.83&nbsp;</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:379;border-bottom:
    1.0pt solid windowtext;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">Dividends per common share</font></b></p>
    </td>
    <td valign=top style='width:71;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.60&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='width:38;border-top:medium none;border-left:
    medium none;border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.60&nbsp;</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:379;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><b><font size="2">Weighted average shares outstanding:</font></b></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:38;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='width:75;border:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:18;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:378;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Basic</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-top:medium none; border-bottom:medium none; width:71;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">10,224&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='width:38;border-top:medium none;border-left:
    medium none;border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">10,224&nbsp;</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td valign=top style='width:379;border-top:1.0pt solid windowtext;
    border-left:medium none;border-bottom:1.0pt solid windowtext;border-right:medium none;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal style='margin-top:0; margin-bottom:0'><font size="2">Diluted</font></p>
    </td>
    <td valign=top style='border-right:1.0pt solid windowtext; border-top:1.0pt solid windowtext; border-bottom:1.0pt solid windowtext; width:71;border-left:medium none;padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">10,453&nbsp;</font></p>
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td valign=top style='width:38;border-top:medium none;border-left:
    medium none;border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td valign=top style='border-left:medium none; border-right:medium none; border-top:medium none; width:75;border-bottom:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
    <p class=MsoNormal align=right style='text-align:right;margin-top:0; margin-bottom:0'>
    <font size="2">10,453&nbsp;</font></p>
    </td>
    <td valign=top style='width:18;border-top:medium none;border-left:medium none;
    border-bottom:1.0pt solid windowtext;border-right:1.0pt solid windowtext;
    padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
  </table>
  
  </div>
  
  <p class=MsoNormal align=center style='text-align:center;margin-top:0; margin-bottom:0'><br>
  <br>
  <br>
  <br>
  </p>
  
  <p class=MsoNormal align=center style='text-align:center;margin-top:0; margin-bottom:0'>See accompanying notes.<hr color="#000080">
  <p style="margin-top: 0; margin-bottom: 0" align="center"><br clear=all style='page-break-before:
  always'>
  <b><font size="2">PARKWAY PROPERTIES, INC. AND SUBSIDIARIES<br>
  PRO FORMA CONSOLIDATED STATEMENT OF INCOME<br>
  FOR THE SIX MONTHS ENDED JUNE 30, 2004<br>
  </font>
  </b><font size="2">(Unaudited)</font></p>
  <p style="margin-top: 0; margin-bottom: 0" align="center">&nbsp;</p>
  <p style="margin-top: 0; margin-bottom: 0"></p>
  
  
  
  
  
  <div align=center>
  
  <table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0
   style='border-collapse:collapse' bordercolorlight="#FFFFFF" bordercolordark="#FFFFFF">
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">&nbsp;</font></b></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Parkway </font> </b></p>
    <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Historical</font></b></p>
    </td>
    <td width=109 colspan=2 valign=top style='width:82.05pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Pro Forma</font></b></p>
    <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Adjustments (2)</font></b></p>
    </td>
    <td width=93 colspan=2 valign=top style='width:69.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Parkway</font></b></p>
    <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Pro Forma</font></b></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">&nbsp;</font></b></p>
    </td>
    <td width=277 colspan=5 valign=top style='width:208.1pt;border:none;
    border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">(In thousands, except per share data)</font></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Revenues</font></b></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">&nbsp;</font></b></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">&nbsp;</font></b></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">&nbsp;</font></b></p>
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">&nbsp;</font></b></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">&nbsp;</font></b></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Income from office and parking&nbsp; properties</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;77,131&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;5,230&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">(b)</font></p>
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">$82,361&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Management company income</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">837&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">837&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Other income and deferred gains</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">17&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">17&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Total Revenues</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">77,985&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">5,230&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">83,215&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Expenses</font></b></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Office and parking properties:</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating expense</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">36,143&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">2,105&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">(b)</font></p>
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">38,248&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest expense:</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contractual</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">9,317&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">1,424&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">(c)</font></p>
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">10,741&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Prepayment expenses</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">271&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">271&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization
    of loan costs</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">248&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">248&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and
    amortization</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">15,919&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">1,107&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">(b)</font></p>
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">17,026&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Operating expense for other real estate properties</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">20&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">20&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Interest expense on bank notes:</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contractual</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">1,764&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">307&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">(d)</font></p>
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">2,071&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization
    of loan costs</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">215&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">215&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Management company expenses</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">172&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">172&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">General and administrative</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">1,967&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">1,967&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Total Expenses</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">66,036&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">4,943&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">70,979&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Income before equity in earnings, gain and </font> </b></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font><b><font size="2">minority interest
    </font> </b></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">11,949&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">287&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">12,236&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Equity in earnings of unconsolidated joint ventures</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">1,110&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">1,110&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Gain on note receivable</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">774&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">774&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Minority interest - unit holders</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">(1)</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">(1)</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Minority interest - real estate partnerships</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">123&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">123&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Net Income</font></b></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">13,955&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">287&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">14,242&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Change in market value of interest rate swap</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">166&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">166&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Comprehensive income</font></b></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;14,121&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;287&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;14,408&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Net income available to common stockholders:</font></b></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=76 valign=top style='width:57.3pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Net income</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;13,955&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;287&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;14,242&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid;height:13.05pt'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt;
    height:13.05pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Dividends on preferred stock</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt;height:13.05pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">(2,667)</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt;
    height:13.05pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">(271)</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt;height:13.05pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">(e)</font></p>
    </td>
    <td width=69 valign=top style='width:51.65pt;padding:0in 5.4pt 0in 5.4pt;
    height:13.05pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">(2,938)</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt;height:13.05pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">Dividends on convertible preferred stock</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">(2,772)</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">(2,772)</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Net income available to common stockholders</font></b></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;8,516&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;8,532&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border:none;border-top:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Net income per common share:</font></b></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.78&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.78&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></b><font size="2">Diluted</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.76&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.76&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Dividends per common share</font></b></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.30&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.30&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">Weighted average shares outstanding:</font></b></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=76 valign=top style='width:57.3pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=33 valign=top style='width:24.75pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=24 valign=top style='width:.25in;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">10,974&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">10,974&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=347 valign=top style='width:260.35pt;border:none;border-bottom:
    solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><b>
    <font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></b><font size="2">Diluted</font></p>
    </td>
    <td width=75 valign=top style='width:56.4pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">11,178&nbsp;</font></p>
    </td>
    <td width=76 valign=top style='width:57.3pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right;line-height:-100%; margin-top:0; margin-bottom:0'>
    <font size="2">-&nbsp;</font></p>
    </td>
    <td width=33 valign=top style='width:24.75pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=69 valign=top style='width:51.65pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='text-align:right; margin-top:0; margin-bottom:0'>
    <font size="2">11,178&nbsp;</font></p>
    </td>
    <td width=24 valign=top style='width:.25in;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
  </table>
  
  </div>
  
  <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'>
  <font size="2"><br>
  </font>
  <br>
  See accompanying notes<br>
  </p>
  
  <hr color="#000080">
  
  <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'>
  <br>
  </p>
  
  <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>PARKWAY PROPERTIES, INC.<br>
  Notes to Pro Forma Consolidated Financial Statements<br>
  </b>(Unaudited)<b><br>
  <br>
  </b></p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On August 24,
   2004, Parkway Properties, Inc.
  (&quot;Parkway&quot;) purchased Squaw Peak Corporate Center (&quot;Squaw Peak&quot;), a two
  building 287,000 square foot, office campus in the Camelback/Squaw Peak
  submarket of Phoenix, Arizona.&nbsp; The property was acquired for $46.9 million
  plus $2.7 million in closing costs and anticipated capital expenditures and
  leasing commissions during the first two years of ownership.&nbsp; The purchase was
  funded with Parkway's existing lines of credit and the assumption of an
  existing first mortgage of $33.8 million.&nbsp; The mortgage matures in December
  2010 and bears interest at 8.16%.&nbsp; In accordance with generally accepted accounting
  principles, the mortgage was recorded at $39.6 million to reflect the fair
  value of the financial instrument based on the rate of 4.92% on the date of
  purchase.&nbsp; </p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Squaw Peak also
  includes two adjoining two-story parking decks containing 518 spaces, 122
  covered spaces and a surface parking lot containing 792 parking spaces.&nbsp; The
  property is currently 92% leased to multiple customers including Aetna, URS
  Greiner Woodward, a global engineering firm, Chubb, MetLife, ING and Fidelity
  National Title.&nbsp; </p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The pro forma adjustments to the
  Consolidated Statement of Income for the year ended December 31, 2003 and six months ended June 30, 2004 set forth the effects of Parkway's purchase of the
  following buildings as if they had been consummated on January 1, 2003.&nbsp; </p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <div align=center>
  
  <table class=MsoTableGrid border=1 cellspacing=0 cellpadding=0
   style='border-style:none; border-color:inherit; border-collapse:collapse;' bordercolorlight="#FFFFFF" bordercolordark="#FFFFFF" bgcolor="#FFFFFF">
   <tr>
    <td width=219 valign=top style='width:164.6pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
    <td width=95 valign=top style='width:71.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Date of</b></p>
    </td>
   </tr>
   <tr>
    <td width=219 valign=top style='width:164.6pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Building</b></p>
    </td>
    <td width=95 valign=top style='width:71.0pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Purchase</b></p>
    </td>
   </tr>
   <tr>
    <td width=219 valign=top style='width:164.6pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">Maitland
    200</p>
    </td>
    <td width=95 valign=top style='width:71.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>01/29/04</p>
    </td>
   </tr>
   <tr>
    <td width=219 valign=top style='width:164.6pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">Capital City Plaza</p>
    </td>
    <td width=95 valign=top style='width:71.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>04/02/04</p>
    </td>
   </tr>
   <tr>
    <td width=219 valign=top style='width:164.6pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">Squaw Peak</p>
    </td>
    <td width=95 valign=top style='width:71.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'>08/24/04</p>
    </td>
   </tr>
  </table>
  
  </div>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These
  pro forma adjustments are detailed below for the year ended December 31, 2003 and six months ended June 30, 2004.</p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  effect on income and expenses from real estate properties is as follows (in
  thousands):</p>
  
  
  
  <p class=MsoNormal style='margin-left:.5in;text-indent:-.5in; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;For
  the year ended December
   31, 2003:</p>
  
  
  
  <p class=MsoNormal style='margin-left:.5in;text-indent:-.5in; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <div align=center>
  
  <table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0
   style='border-collapse:collapse;border:none'>
   <tr style='page-break-inside:avoid'>
    <td width=135 valign=top style='width:101.3pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b>&nbsp;</b></p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Revenue</b></p>
    </td>
    <td width=208 colspan=2 valign=top style='width:156.05pt;border:none;
    border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Expenses</b></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=135 valign=top style='width:101.3pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Income From</b></p>
    </td>
    <td width=208 colspan=2 valign=top style='width:156.05pt;border-top:none;
    border-left:none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Real Estate Owned</b></p>
    </td>
   </tr>
   <tr>
    <td width=135 valign=top style='width:101.3pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Building</b></p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Real Estate</b></p>
    </td>
    <td width=100 valign=top style='width:75.05pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Operating</b></p>
    </td>
    <td width=108 valign=top style='width:81.0pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Depreciation</b></p>
    </td>
   </tr>
   <tr>
    <td width=135 valign=top style='width:101.3pt;border:solid windowtext 1.0pt;
    border-top:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Properties</b></p>
    </td>
    <td width=100 valign=top style='width:75.05pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Expense</b></p>
    </td>
    <td width=108 valign=top style='width:81.0pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Expense</b></p>
    </td>
   </tr>
   <tr>
    <td width=135 valign=top style='width:101.3pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">Maitland
    200</p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.05pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;&nbsp;&nbsp;3,824</p>
    </td>
    <td width=100 valign=top style='width:75.05pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:12.1pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;1,561</p>
    </td>
    <td width=108 valign=top style='width:81.0pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.1pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;592</p>
    </td>
   </tr>
   <tr>
    <td width=135 valign=top style='width:101.3pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">Capital City Plaza</p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.05pt;text-align:right; margin-top:0; margin-bottom:0'>8,510</p>
    </td>
    <td width=100 valign=top style='width:75.05pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:12.1pt;text-align:right; margin-top:0; margin-bottom:0'>4,186</p>
    </td>
    <td width=108 valign=top style='width:81.0pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.1pt;text-align:right; margin-top:0; margin-bottom:0'>1,852</p>
    </td>
   </tr>
   <tr>
    <td width=135 valign=top style='width:101.3pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">Squaw Peak</p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.05pt;text-align:right; margin-top:0; margin-bottom:0'>5,793</p>
    </td>
    <td width=100 valign=top style='width:75.05pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:12.1pt;text-align:right; margin-top:0; margin-bottom:0'>2,041</p>
    </td>
    <td width=108 valign=top style='width:81.0pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.1pt;text-align:right; margin-top:0; margin-bottom:0'>1,199</p>
    </td>
   </tr>
   <tr>
    <td width=135 valign=top style='width:101.3pt;border:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=113 valign=top style='width:84.8pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.05pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;18,127</p>
    </td>
    <td width=100 valign=top style='width:75.05pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:12.1pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;7,788</p>
    </td>
    <td width=108 valign=top style='width:81.0pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.1pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;3,643</p>
    </td>
   </tr>
  </table>
  
  </div>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation is provided by the
  straight-line method over the estimated useful life (40 years for buildings and
  5 - 15 years for building improvements).</p>
  
  <p class=MsoNormal style='line-height:-100%; margin-top:0; margin-bottom:0'><br>
  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;For the six
  months ended June 30, 2004:<br>
  <br>
  </p>
  
  <div align=center>
  
  <table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0
   style='border-collapse:collapse;border:none'>
   <tr style='page-break-inside:avoid'>
    <td width=135 valign=top style='width:101.3pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b>&nbsp;</b></p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border:none;border-bottom:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Revenue</b></p>
    </td>
    <td width=208 colspan=2 valign=top style='width:156.05pt;border:none;
    border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Expenses</b></p>
    </td>
   </tr>
   <tr style='page-break-inside:avoid'>
    <td width=135 valign=top style='width:101.3pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b>&nbsp;</b></p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Income From</b></p>
    </td>
    <td width=208 colspan=2 valign=top style='width:156.05pt;border-top:none;
    border-left:none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Real Estate Owned</b></p>
    </td>
   </tr>
   <tr>
    <td width=135 valign=top style='width:101.3pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Building</b></p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Real Estate</b></p>
    </td>
    <td width=100 valign=top style='width:75.05pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Operating</b></p>
    </td>
    <td width=108 valign=top style='width:81.0pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Depreciation</b></p>
    </td>
   </tr>
   <tr>
    <td width=135 valign=top style='width:101.3pt;border:solid windowtext 1.0pt;
    border-top:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><b>&nbsp;</b></p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Properties</b></p>
    </td>
    <td width=100 valign=top style='width:75.05pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Expense</b></p>
    </td>
    <td width=108 valign=top style='width:81.0pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Expense</b></p>
    </td>
   </tr>
   <tr>
    <td width=135 valign=top style='width:101.3pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">Maitland
    200</p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:18.95pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;285</p>
    </td>
    <td width=100 valign=top style='width:75.05pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:12.1pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;116</p>
    </td>
    <td width=108 valign=top style='width:81.0pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.1pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;45</p>
    </td>
   </tr>
   <tr>
    <td width=135 valign=top style='width:101.3pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">Capital City Plaza</p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:18.95pt;text-align:right; margin-top:0; margin-bottom:0'>1,973</p>
    </td>
    <td width=100 valign=top style='width:75.05pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:12.1pt;text-align:right; margin-top:0; margin-bottom:0'>965</p>
    </td>
    <td width=108 valign=top style='width:81.0pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.1pt;text-align:right; margin-top:0; margin-bottom:0'>463</p>
    </td>
   </tr>
   <tr>
    <td width=135 valign=top style='width:101.3pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">Squaw Peak</p>
    </td>
    <td width=113 valign=top style='width:84.8pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:18.95pt;text-align:right; margin-top:0; margin-bottom:0'>2,972</p>
    </td>
    <td width=100 valign=top style='width:75.05pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:12.1pt;text-align:right; margin-top:0; margin-bottom:0'>1,024</p>
    </td>
    <td width=108 valign=top style='width:81.0pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.1pt;text-align:right; margin-top:0; margin-bottom:0'>599</p>
    </td>
   </tr>
   <tr>
    <td width=135 valign=top style='width:101.3pt;border:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=113 valign=top style='width:84.8pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:18.95pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;5,230</p>
    </td>
    <td width=100 valign=top style='width:75.05pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:12.1pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;2,105</p>
    </td>
    <td width=108 valign=top style='width:81.0pt;border:solid windowtext 1.0pt;
    border-left:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.1pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;1,107</p>
    </td>
   </tr>
  </table>
  
  </div>
  
  
  
  <hr color="#000080">
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation
  is provided by the straight-line method over the estimated useful life (40
  years for buildings and 5 - 15 years for building improvements).</p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;Pro
  forma interest expense on real estate owned reflects interest on non-recourse
  debt assumed upon purchase as if in place January 1, 2003 and is detailed below (in
  thousands).</p>
  
  
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;</p>
  
  
  
  <div align=center>
  
  <table class=MsoTableGrid border=0 cellspacing=0 cellpadding=0
   style='border-collapse:collapse'>
   <tr>
    <td width=310 valign=top style='width:232.85pt;border:solid windowtext 1.0pt;
    border-bottom:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
    <td width=85 valign=top style='width:63.7pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
    <td width=102 valign=top style='width:76.85pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
    <td width=121 valign=top style='width:90.55pt;border-top:solid windowtext 1.0pt;
    border-left:none;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Six</b></p>
    </td>
   </tr>
   <tr>
    <td width=310 valign=top style='width:232.85pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Property/Placement</b></p>
    </td>
    <td width=85 valign=top style='width:63.7pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>&nbsp;</b></p>
    </td>
    <td width=102 valign=top style='width:76.85pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Year Ended</b></p>
    </td>
    <td width=121 valign=top style='width:90.55pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Months Ended</b></p>
    </td>
   </tr>
   <tr>
    <td width=310 valign=top style='width:232.85pt;border:solid windowtext 1.0pt;
    border-top:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Date/Rate</b></p>
    </td>
    <td width=85 valign=top style='width:63.7pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>Debt</b></p>
    </td>
    <td width=102 valign=top style='width:76.85pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>12/31/03</b></p>
    </td>
    <td width=121 valign=top style='width:90.55pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=center style='text-align:center; margin-top:0; margin-bottom:0'><b>06/30/04</b></p>
    </td>
   </tr>
   <tr>
    <td width=310 valign=top style='width:232.85pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>Debt assumed in Capital City Plaza purchase</p>
    </td>
    <td width=85 valign=top style='width:63.7pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=102 valign=top style='width:76.85pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=121 valign=top style='width:90.55pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=310 valign=top style='width:232.85pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;04/04&nbsp;&nbsp;&nbsp;&nbsp;3.67%</p>
    </td>
    <td width=85 valign=top style='width:63.7pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:4.55pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;49,073</p>
    </td>
    <td width=102 valign=top style='width:76.85pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.1pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;1,801</p>
    </td>
    <td width=121 valign=top style='width:90.55pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:23.75pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;450</p>
    </td>
   </tr>
   <tr>
    <td width=310 valign=top style='width:232.85pt;border-top:none;border-left:
    solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>Debt assumed in Squaw Peak
    purchase</p>
    </td>
    <td width=85 valign=top style='width:63.7pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=102 valign=top style='width:76.85pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=121 valign=top style='width:90.55pt;border:none;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=310 valign=top style='width:232.85pt;border:solid windowtext 1.0pt;
    border-top:none;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'>&nbsp;&nbsp;&nbsp;&nbsp;08/04&nbsp;&nbsp;&nbsp;&nbsp;4.92%</p>
    </td>
    <td width=85 valign=top style='width:63.7pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:4.55pt;text-align:right; margin-top:0; margin-bottom:0'>39,604</p>
    </td>
    <td width=102 valign=top style='width:76.85pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.1pt;text-align:right; margin-top:0; margin-bottom:0'>1,949</p>
    </td>
    <td width=121 valign=top style='width:90.55pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:23.75pt;text-align:right; margin-top:0; margin-bottom:0'>974</p>
    </td>
   </tr>
   <tr>
    <td width=310 valign=top style='width:232.85pt;border:solid windowtext 1.0pt;
    border-top:none;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=85 valign=top style='width:63.7pt;border-top:none;border-left:none;
    border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:4.55pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;88,677</p>
    </td>
    <td width=102 valign=top style='width:76.85pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:15.1pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;3,750</p>
    </td>
    <td width=121 valign=top style='width:90.55pt;border-top:none;border-left:
    none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal align=right style='margin-right:23.75pt;text-align:right; margin-top:0; margin-bottom:0'>$&nbsp;&nbsp;1,424</p>
    </td>
   </tr>
  </table>
  
  </div>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;The
  pro forma effect of the Maitland 200 Purchase, the Capital City Plaza Purchase and
  the Squaw Peak Purchase on interest expense on notes payable to banks was $1,355,000
  for the year ended December 31, 2003 and $307,000 for the six months ended June
  30, 2004.</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;The
  pro forma effect of the Capital City Plaza Purchase on dividends on preferred
  membership interests was $1,084,000 for the year ended December 31, 2003 and
  $271,000 for the six months ended June 30, 2004.</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No additional income tax expenses
  were provided because of the Company's net operating loss carryover and status
  as a REIT.</p>
  
  <p class=Legal6 style='margin-left:0in;text-align:justify;text-indent:0in; margin-top:0; margin-bottom:0'><br>
  4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted net income per share for
  the year ended December 31, 2003 and six months
  ended June 30, 2004 was $2.79 and $.76 respectively,
  based on diluted weighted average shares outstanding of 10,453,000 and 11,178,000,
  respectively.</p>
  
  <p class=MsoNormal style="margin-top: 0; margin-bottom: 0"><br>
  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro
  forma diluted net income per share for the year ended December 31, 2003 and the
  six months ended June 30, 2004 was $2.83 and $.76, respectively, based on
  diluted weighted average shares outstanding of 10,453,000 and 11,178,000,
  respectively.</p>
  
  <hr color="#000080">
  <p style="margin-top: 0; margin-bottom: 0"><br clear=all style='page-break-before:always'>
  
  
  </p>
  
  
  <p class=MsoNormal align=center style='text-align:center;line-height:-100%; margin-top:0; margin-bottom:0'>&nbsp;<br>
  <b>SIGNATURES</b></p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  <br>
  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the
  Securities Exchange Act of 1934, the Registrant has duly caused this report to
  be signed on its behalf by the undersigned hereunto duly authorized.</p>
  
  <p class=MsoNormal style='text-align:justify; margin-top:0; margin-bottom:0'><br>
  <br>
  </p>
  
  <table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
   style='border-collapse:collapse'>
   <tr style='page-break-inside:avoid'>
    <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">DATE:&nbsp;&nbsp;&nbsp;November
    29, 2004</p>
    </td>
    <td width=312 colspan=2 valign=top style='width:3.25in;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">PARKWAY
    PROPERTIES, INC.</p>
    </td>
   </tr>
   <tr>
    <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=48 valign=top style='width:.5in;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=264 valign=top style='width:2.75in;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=48 valign=top style='width:.5in;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=264 valign=top style='width:2.75in;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=48 valign=top style='width:.5in;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=264 valign=top style='width:2.75in;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
   </tr>
   <tr>
    <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
  
    <p style="margin-top: 0; margin-bottom: 0">
  
    </td>
    <td width=48 valign=top style='width:.5in;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">BY:</p>
    </td>
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    padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">/s/&nbsp;Mandy
    M. Pope</p>
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    <td width=264 valign=top style='width:2.75in;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">Mandy
    M. Pope, CPA</p>
    </td>
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    <td width=264 valign=top style='width:2.75in;padding:0in 5.4pt 0in 5.4pt'>
    <p class=MsoNormal style="margin-top: 0; margin-bottom: 0">Chief
    Accounting Officer</p>
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metadata_documents: [{"type": "8-K", "sequence": "1", "filename": "squawpeakpurchase.htm", "description": "HTML FORMAT", "secsgml_size_bytes": 277126}, {"type": "8-K", "sequence": "2", "filename": "squawpeakpurchase.pdf", "description": "PDF FORMAT", "secsgml_size_bytes": 145059}]
metadata_filer: {"company-data": {"conformed-name": "PARKWAY PROPERTIES INC", "cik": "0000729237", "assigned-sic": "6798", "irs-number": "742123597", "state-of-incorporation": "MD", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-11533", "film-number": "041172248"}, "business-address": {"street1": "ONE JACKSON PL", "street2": "188 E CAPITOL ST STE 1000", "city": "JACKSON", "state": "MS", "zip": "39225-4647", "phone": "6019484091"}, "mail-address": {"street1": "ONE JACKSON PL P O BOX 24647", "street2": "188 E CAPITOL ST STE 1000", "city": "JACKSON", "state": "MS", "zip": "39225"}, "former-company": {"former-conformed-name": "PARKWAY CO", "date-changed": "19951018"}}
text: UNITED STATES
  UNITED STATES
  SECURITIES AND EXCHANGE COMMISSION
  Washington, D.C. 20549
  __________________________
  FORM 8-K
  Current Report
  Pursuant to Section 13 or 15(d) of the Securities
  Exchange Act of 1934
  Date of Report (date of earliest event reported):  N/A
  PARKWAY PROPERTIES, INC
  .
  (Exact Name of Registrant as Specified in its Charter)
  Maryland
  1-11533
  74-2123597
  (State or Other
  Jurisdiction             (Commission File Number)                      (IRS
  Employer
  of Incorporation)                                                                                 Identification
  No.)
  One Jackson Place, Suite 1000, 188 East Capitol
  Street, Jackson, MS 39225-4647
  (Address of Principal Executive Offices, including zip
  code)
  (601) 948-4091
  (Registrant's telephone number, including area code)
  Not Applicable
  (Former name or former address, if changed since last
  report)
  Check
  the appropriate box below if the Form 8-K filing is intended to simultaneously
  satisfy the filing obligation of the registrant under any of the following
  provisions (see General Instruction A.2. below):
           Written
  communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
           Soliciting
  material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
           Pre-commencement
  communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
  240.14d-2(b))
           Pre-commencement
  communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
  240.13e-4(c))
  FORM 8-K
  PARKWAY PROPERTIES, INC.
  Item 8.01. Other Events.
  On
  August 24, 2004, Parkway Properties, Inc. ("Parkway") purchased Squaw Peak Corporate Center, a 287,000
  square foot, two-building office campus in the Camelback/Squaw Peak submarket
  of Phoenix, Arizona from an unrelated party.  The property was acquired
  for $46.9 million plus $2.7 million in closing costs and anticipated capital
  expenditures and leasing commissions during the first two years of ownership. 
  The purchase was funded with the Company's existing lines of credit and the
  assumption of an existing first mortgage of $33.8 million.  The mortgage matures
  in December 2010 and bears interest at 8.16%.  In accordance with generally
  accepted accounting principles, the mortgage was recorded at $39.6 million to
  reflect the fair value of the financial instrument based on the rate of 4.92%
  on the date of purchase.
  Squaw
  Peak Corporate Center also includes two adjoining two-story parking decks
  containing 518 spaces, 122 covered spaces and a surface parking lot containing
  792 parking spaces.  On the date of purchase, the property was 92% leased to multiple
  customers including Aetna, URS Greiner Woodward, a global engineering firm,
  Chubb, MetLife, ING and Fidelity National Title.
  Item 9.01.  Financial Statements and
  Exhibits.
  (a)    Financial
    Statements
  The
    following audited financial statement of Squaw Peak for the year ended December 31, 2003 is attached
    hereto.  Also included is the unaudited financial statement for the six
    months ended June 30, 2004:
  Page
  Report
    of Independent Auditors
  4
  Statements
    of Rental Revenues and Direct Operating Expenses
  5
  Notes
    to Statements of Rental Revenues and Direct Operating Expenses
  6
  The
    following unaudited Pro Forma Consolidated Financial Statements of Parkway
    for the year ended December 31, 2003 and the six months ended June 30, 2004 are
    attached hereto:
  Page
  Pro
    Forma Consolidated Financial Statements (Unaudited)
  8
  Pro
    Forma Consolidated Balance Sheet (Unaudited) - As of June 30, 2004
  9
  Pro
    Forma Consolidated Statement of Income (Unaudited) -
  For
    the Year Ended December 31, 2003
  10
  Pro
    Forma Consolidated Statement of Income (Unaudited) -
  For
    the Six Months Ended June 30, 2004
  11
  Notes
    to Pro Forma Consolidated Financial Statements (Unaudited)
  12
  (b)      Exhibits
  23.1    Consent
    of Ernst & Young LLP
  Report of Independent Auditors
  The Board of Directors
  Parkway Properties, Inc.
  We have audited the accompanying statement of rental revenues and direct
  operating expenses of Squaw Peak Corporate
   Center ("Squaw Peak") for the year ended December 31, 2003.  This statement is the responsibility of
  management.  Our responsibility is to express an opinion on this statement
  based on our audit.
  We conducted our audit in accordance with auditing standards of the Public
  Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the
  audit to obtain reasonable assurance about whether the statement of rental
  revenues and direct operating expenses is free of material misstatement.  An
  audit includes examining, on a test basis, evidence supporting the amounts and
  disclosures in the statement.  An audit also includes assessing the basis of
  accounting and accounting principles used and significant estimates made by
  management, as well as evaluating the overall statement presentation.  We
  believe that our audit provides a reasonable basis for our opinion.
  The accompanying statements were prepared for the purpose of complying with the
  rules and regulations of the Securities and Exchange Commission, as described
  in Note 2, for inclusion in a Form 8-K of Parkway Properties, Inc. and are not
  intended to be a complete presentation of Squaw Peak's revenues and expenses.
  In our opinion, the statement of rental revenues and direct operating expenses
  referred to above presents fairly, in all material respects, the rental
  revenues and direct operating expenses described in Note 2 of Squaw Peak for
  the year ended December
   31, 2003, in
  conformity with accounting principles generally accepted in the United States.
  The accompanying financial statements for 2004 were not
  audited by us and, accordingly, we do not express an opinion on them.
  Ernst & Young LLP
  New
  Orleans, Louisiana
  October
   7, 2004
  Squaw Peak
  Statements of Rental Revenues
  and Direct Operating Expenses
  (in thousands)
  Year Ended
  Six Months
    Ended
  December 31, 2003
  June 30, 2004
  (unaudited)
  Rental revenues:
  Minimum
    rents
  $  5,344
  $  2,822
  Reimbursed
    charges
  261
  63
  Other
    income
  188
  87
  5,793
  2,972
  Direct operating expenses:
  Administrative
    and miscellaneous expenses
  79
  20
  Salaries
    and wages
  120
  60
  Utilities
  387
  190
  Janitorial
    services and supplies
  177
  109
  Maintenance
    services and supplies
  146
  80
  Security
  33
  17
  Management
    fees
  347
  163
  Real
    estate taxes
  752
  385
  2,041
  1,024
  Excess of rental revenues over
    direct operating expenses
  $  3,752
  $  1,948
  See report of
  independent auditors and accompanying notes.
  Squaw Peak
  Notes to Statements of Rental Revenues
  and Direct Operating Expenses
  December 31, 2003 and June 30, 2004
  1.    Organization and Significant Accounting Policies
  Description of Property
  On August 24, 2004, Parkway Properties, Inc. ("Parkway") purchased Squaw Peak, a two-building office campus located in the
  Camelback/Squaw Peak submarket of Phoenix, Arizona
  from an unrelated party. Squaw Peak contains approximately 287,000
  (unaudited) net rentable square feet of office space.  The acquisition also
  includes two adjoining two-story parking decks containing 518 spaces, 122
  covered spaces and a surface parking lot containing 792 parking spaces.
  Management's Use of Estimates
  The preparation of financial statements in conformity
  with accounting principles generally accepted in the United States requires
  management to make estimates and assumptions that affect the reported amounts
  of revenues and expenses during the reporting period.  Actual results could
  differ from those estimates.
  Rental
  Revenue
  Minimum rents from leases
  are accounted for ratably over the term of each lease.  Tenant reimbursements
  are recognized as revenue as the applicable services are rendered or expenses
  incurred.
  The future minimum rents for Squaw Peak's non-cancelable operating
  leases at December
   31, 2003 are as
  follows (in thousands):
  Year
  Amount
  2004
  $  5,400
  2005
  5,920
  2006
  4,608
  2007
  3,462
  2008
  2,925
  Thereafter
  1,022
  $23,337
  The above amounts do not include tenant reimbursements for utilities, taxes,
  insurance and common area maintenance.
  See report of independent auditors.
  As of December 31,
   2003, Squaw Peak had six customers including Aetna, URS Greiner
  Woodward, Entranco, Inc., Century Title Agency, Inc., CMX, LLC and Associated
  Asset Management, Inc. that occupied approximately 66% of the office space.
  2.     Basis of Accounting
  The accompanying statements of rental revenues and direct operating expenses
  are presented on the accrual basis.  The statements have been prepared in
  accordance with the applicable rules and regulations of the Securities and
  Exchange Commission for real estate properties acquired.  Accordingly, the
  statements exclude certain expenses not comparable to the future operations of Squaw Peak such as depreciation and mortgage interest expense.  Management
  is not aware of any material factors relating to Squaw Peak that
  would cause the reported financial information not to be necessarily indicative
  of future operating results.
  3.     Management Fees
  Management fees of approximately 6% of revenues received from the operations of
  Squaw Peak were paid to an unrelated management company.
  See report of independent auditors.
  PARKWAY PROPERTIES, INC.
  Pro Forma Consolidated Financial Statements
  (Unaudited)
  The following unaudited pro forma
  consolidated balance sheet as of June 30, 2004 and pro forma consolidated
  statements of income of Parkway Properties, Inc. ("Parkway") for the
  year ended December 31, 2003 and six months ended June 30, 2004 give effect to
  the purchases by Parkway of certain properties listed below for the periods
  stated.  The pro forma consolidated financial statements have been prepared by
  management of Parkway based upon the historical financial statements of Parkway
  and the adjustments and assumptions in the accompanying notes to the pro forma
  consolidated financial statements.
  The pro forma consolidated balance
  sheet sets forth the effect of Parkway's purchase of the Squaw Peak Corporate
  Center ("Squaw Peak") as if it had been consummated on June 30, 2004.
  The pro forma consolidated statements
  of income set forth the effects of Parkway's purchases of the buildings listed
  below as if each had been consummated on January 1, 2003.
  Building
  Date of Purchase
  Maitland 200
  01/29/04
  Capital City Plaza
  04/02/04
  Squaw Peak
  08/24/04
  These pro forma consolidated
  financial statements may not be indicative of the results that actually would
  have occurred if the transactions had occurred on the dates indicated or which
  may be obtained in the future.  The pro forma consolidated financial statements
  should be read in conjunction with the consolidated financial statements and
  notes of Parkway included in its annual report on Form 10-K for the year ended
  December 31, 2003.
  PARKWAY PROPERTIES, INC.
  AND SUBSIDIARIES
  PRO
  FORMA CONSOLIDATED BALANCE SHEET
  JUNE 30, 2004
  (Unaudited)
  Parkway
  Historical
  Pro Forma
  Adjustments (1)
  Parkway
  Pro Forma
  (In thousands)
  Assets
  Real
    estate related investments:
  Office
    and parking properties
  $  990,733
  $    52,641
  $1,043,374
  Parking
    development
  302
  -
  302
  Accumulated
    depreciation
  (131,679)
  -
  (131,679)
  859,356
  52,641
  911,997
  Land
    held for sale
  3,528
  -
  3,528
  Investment
    in unconsolidated joint ventures
  19,997
  -
  19,997
  882,881
  52,641
  935,522
  Interest,
    rents receivable and other assets
  45,153
  -
  45,153
  Cash
    and cash equivalents
  1,742
  -
  1,742
  $  929,776
  $    52,641
  $  982,417
  Liabilities
  Notes
    payable to banks
  $  129,161
  $    13,037
  $  142,198
  Mortgage
    notes payable without recourse
  326,315
  39,604
  365,919
  Accounts
    payable and other liabilities
  38,458
  -
  38,458
  493,934
  52,641
  546,575
  Minority
    Interest
  Minority
    interest - unit holders
  40
  -
  40
  Minority
    interest - real estate partnerships
  3,774
  -
  3,774
  3,814
  -
  3,814
  Stockholders'
    Equity
  8.34%
    Series B Cumulative Convertible Preferred
  stock,
    $.001 par value, 2,142,857 shares authorized,
  1,867,857
    shares issued and outstanding
  65,375
  -
  65,375
  Series
    C Preferred stock, $.001 par value, 400,000 shares
  authorized,
    no shares issued
  -
  -
  -
  8.00%
    Series D Preferred stock, $.001 par value,
  2,400,000
    shares authorized, issued and outstanding
  57,976
  -
  57,976
  Preferred
    membership interests
  15,491
  15,491
  Common
    stock, $.001 par value, 65,057,143 shares
  authorized,
    11,278,470 shares issued and outstanding
  11
  -
  11
  Excess
    stock, $.001 par value, 30,000,000 shares authorized,
  no
    shares issued
  -
  -
  -
  Common
    stock held in trust, at cost, 130,000 shares
  (4,400)
  -
  (4,400)
  Additional
    paid-in capital
  269,304
  -
  269,304
  Unearned
    compensation
  (4,241)
  -
  (4,241)
  Accumulated
    other comprehensive income
  166
  -
  166
  Retained
    earnings
  32,346
  -
  32,346
  432,028
  -
  432,028
  $  929,776
  $    52,641
  $  982,417
  See accompanying notes
  PARKWAY PROPERTIES, INC. AND SUBSIDIARIES
  PRO FORMA CONSOLIDATED STATEMENT OF INCOME
  FOR THE YEAR ENDED DECEMBER
   31, 2003
  (Unaudited)
  Parkway
  Historical
  Pro Forma
  Adjustments (2)
  Parkway
  Pro Forma
  (In thousands, except per share
    data)
  Revenues
  Income from office and parking  properties
  $142,196
  $  18,127
  (a)
  $160,323
  Management company income
  2,136
  -
  2,136
  Interest on note receivable from Moore Building
    Associates LP
  819
  -
  819
  Incentive management fee from Moore Building
    Associates LP
  300
  -
  300
  Other income and deferred gains
  599
  -
  599
  Total Revenues
  146,050
  18,127
  164,177
  Expenses
  Office and parking properties:
  Operating
    expense
  63,362
  7,788
  (a)
  71,150
  Interest
    expense:
  Contractual
  16,026
  3,750
  (c)
  19,776
  Amortization
    of loan costs
  293
  -
  293
  Depreciation
    and amortization
  28,030
  3,643
  (a)
  31,673
  Operating expense for other real estate properties
  37
  -
  37
  Interest expense on bank notes:
  Contractual
  2,834
  1,355
  (d)
  4,189
  Amortization
    of loan costs
  565
  -
  565
  Management company expenses
  391
  -
  391
  General and administrative
  4,201
  -
  4,201
  Total Expenses
  115,739
  16,536
  132,275
  Income before equity in earnings,  gain and minority
    interest
  30,311
  1,591
  31,902
  Equity in earnings of unconsolidated joint ventures
  2,212
  -
  2,212
  Gain on sale of joint venture interest and real estate
  10,661
  -
  10,661
  Minority interest - unit holders
  (3)
  -
  (3)
  Net Income
  43,181
  1,591
  44,772
  Change in market value of interest rate swap
  170
  -
  170
  Comprehensive income
  $  43,351
  $    1,591
  $  44,942
  Net income available to common stockholders:
  Net income
  $  43,181
  $    1,591
  $  44,772
  Original issue costs associated with redemption or
    preferred stock
  (2,619)
  -
  (2,619)
  Dividends on preferred stock
  (5,352)
  (1,084)
  (e)
  (6,436)
  Dividends on convertible preferred stock
  (6,091)
  -
  (6,091)
  Net income available to common stockholders
  $  29,119
  $       507
  $  29,626
  Net income per common share:
  Basic
  $      2.85
  -
  $      2.90
  Diluted:
  $      2.79
  -
  $      2.83
  Dividends per common share
  $      2.60
  -
  $      2.60
  Weighted average shares outstanding:
  Basic
  10,224
  -
  10,224
  Diluted
  10,453
  -
  10,453
  See accompanying notes.
  PARKWAY PROPERTIES, INC. AND SUBSIDIARIES
  PRO FORMA CONSOLIDATED STATEMENT OF INCOME
  FOR THE SIX MONTHS ENDED JUNE 30, 2004
  (Unaudited)
  Parkway
  Historical
  Pro Forma
  Adjustments (2)
  Parkway
  Pro Forma
  (In thousands, except per share data)
  Revenues
  Income from office and parking  properties
  $ 77,131
  $  5,230
  (b)
  $82,361
  Management company income
  837
  837
  Other income and deferred gains
  17
  -
  17
  Total Revenues
  77,985
  5,230
  83,215
  Expenses
  Office and parking properties:
  Operating expense
  36,143
  2,105
  (b)
  38,248
  Interest expense:
  Contractual
  9,317
  1,424
  (c)
  10,741
  Prepayment expenses
  271
  -
  271
  Amortization
    of loan costs
  248
  -
  248
  Depreciation and
    amortization
  15,919
  1,107
  (b)
  17,026
  Operating expense for other real estate properties
  20
  -
  20
  Interest expense on bank notes:
  Contractual
  1,764
  307
  (d)
  2,071
  Amortization
    of loan costs
  215
  -
  215
  Management company expenses
  172
  -
  172
  General and administrative
  1,967
  -
  1,967
  Total Expenses
  66,036
  4,943
  70,979
  Income before equity in earnings, gain and
  minority interest
  11,949
  287
  12,236
  Equity in earnings of unconsolidated joint ventures
  1,110
  -
  1,110
  Gain on note receivable
  774
  -
  774
  Minority interest - unit holders
  (1)
  -
  (1)
  Minority interest - real estate partnerships
  123
  -
  123
  Net Income
  13,955
  287
  14,242
  Change in market value of interest rate swap
  166
  -
  166
  Comprehensive income
  $  14,121
  $       287
  $  14,408
  Net income available to common stockholders:
  Net income
  $  13,955
  $       287
  $  14,242
  Dividends on preferred stock
  (2,667)
  (271)
  (e)
  (2,938)
  Dividends on convertible preferred stock
  (2,772)
  -
  (2,772)
  Net income available to common stockholders
  $    8,516
  $         16
  $    8,532
  Net income per common share:
  Basic
  $       .78
  -
  $       .78
  Diluted
  $       .76
  -
  $       .76
  Dividends per common share
  $     1.30
  -
  $     1.30
  Weighted average shares outstanding:
  Basic
  10,974
  -
  10,974
  Diluted
  11,178
  -
  11,178
  See accompanying notes
  PARKWAY PROPERTIES, INC.
  Notes to Pro Forma Consolidated Financial Statements
  (Unaudited)
  1.       On August 24,
   2004, Parkway Properties, Inc.
  ("Parkway") purchased Squaw Peak Corporate Center ("Squaw Peak"), a two
  building 287,000 square foot, office campus in the Camelback/Squaw Peak
  submarket of Phoenix, Arizona.  The property was acquired for $46.9 million
  plus $2.7 million in closing costs and anticipated capital expenditures and
  leasing commissions during the first two years of ownership.  The purchase was
  funded with Parkway's existing lines of credit and the assumption of an
  existing first mortgage of $33.8 million.  The mortgage matures in December
  2010 and bears interest at 8.16%.  In accordance with generally accepted accounting
  principles, the mortgage was recorded at $39.6 million to reflect the fair
  value of the financial instrument based on the rate of 4.92% on the date of
  purchase.
  Squaw Peak also
  includes two adjoining two-story parking decks containing 518 spaces, 122
  covered spaces and a surface parking lot containing 792 parking spaces.  The
  property is currently 92% leased to multiple customers including Aetna, URS
  Greiner Woodward, a global engineering firm, Chubb, MetLife, ING and Fidelity
  National Title.
  2.       The pro forma adjustments to the
  Consolidated Statement of Income for the year ended December 31, 2003 and six months ended June 30, 2004 set forth the effects of Parkway's purchase of the
  following buildings as if they had been consummated on January 1, 2003.
  Date of
  Building
  Purchase
  Maitland
    200
  01/29/04
  Capital City Plaza
  04/02/04
  Squaw Peak
  08/24/04
  These
  pro forma adjustments are detailed below for the year ended December 31, 2003 and six months ended June 30, 2004.
  The
  effect on income and expenses from real estate properties is as follows (in
  thousands):
  (a)   For
  the year ended December
   31, 2003:
  Revenue
  Expenses
  Income From
  Real Estate Owned
  Building
  Real Estate
  Operating
  Depreciation
  Properties
  Expense
  Expense
  Maitland
    200
  $    3,824
  $  1,561
  $     592
  Capital City Plaza
  8,510
  4,186
  1,852
  Squaw Peak
  5,793
  2,041
  1,199
  $  18,127
  $  7,788
  $  3,643
  Depreciation is provided by the
  straight-line method over the estimated useful life (40 years for buildings and
  5 - 15 years for building improvements).
  (b)   For the six
  months ended June 30, 2004:
  Revenue
  Expenses
  Income From
  Real Estate Owned
  Building
  Real Estate
  Operating
  Depreciation
  Properties
  Expense
  Expense
  Maitland
    200
  $     285
  $     116
  $       45
  Capital City Plaza
  1,973
  965
  463
  Squaw Peak
  2,972
  1,024
  599
  $  5,230
  $  2,105
  $  1,107
  Depreciation
  is provided by the straight-line method over the estimated useful life (40
  years for buildings and 5 - 15 years for building improvements).
  (c)   Pro
  forma interest expense on real estate owned reflects interest on non-recourse
  debt assumed upon purchase as if in place January 1, 2003 and is detailed below (in
  thousands).
  Six
  Property/Placement
  Year Ended
  Months Ended
  Date/Rate
  Debt
  12/31/03
  06/30/04
  Debt assumed in Capital City Plaza purchase
  04/04    3.67%
  $  49,073
  $  1,801
  $      450
  Debt assumed in Squaw Peak
    purchase
  08/04    4.92%
  39,604
  1,949
  974
  $  88,677
  $  3,750
  $  1,424
  (d)   The
  pro forma effect of the Maitland 200 Purchase, the Capital City Plaza Purchase and
  the Squaw Peak Purchase on interest expense on notes payable to banks was $1,355,000
  for the year ended December 31, 2003 and $307,000 for the six months ended June
  30, 2004.
  (e)   The
  pro forma effect of the Capital City Plaza Purchase on dividends on preferred
  membership interests was $1,084,000 for the year ended December 31, 2003 and
  $271,000 for the six months ended June 30, 2004.
  3.       No additional income tax expenses
  were provided because of the Company's net operating loss carryover and status
  as a REIT.
  4.       Diluted net income per share for
  the year ended December 31, 2003 and six months
  ended June 30, 2004 was $2.79 and $.76 respectively,
  based on diluted weighted average shares outstanding of 10,453,000 and 11,178,000,
  respectively.
  Pro
  forma diluted net income per share for the year ended December 31, 2003 and the
  six months ended June 30, 2004 was $2.83 and $.76, respectively, based on
  diluted weighted average shares outstanding of 10,453,000 and 11,178,000,
  respectively.
  SIGNATURES
  Pursuant to the requirements of the
  Securities Exchange Act of 1934, the Registrant has duly caused this report to
  be signed on its behalf by the undersigned hereunto duly authorized.
  DATE:   November
    29, 2004
  PARKWAY
    PROPERTIES, INC.
  BY:
  /s/ Mandy
    M. Pope
  Mandy
    M. Pope, CPA
  Chief
    Accounting Officer