10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2011

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File Number: 0-20625

DUKE REALTY LIMITED PARTNERSHIP

(Exact Name of Registrant as Specified in Its Charter)

Indiana	35-1898425
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification Number)
600 East 96th Street, Suite 100 Indianapolis, Indiana	46240
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s Telephone Number, Including Area Code: (317) 808-6000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes  x    No   ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer”, and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

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

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

Class	Outstanding at August 5, 2011
Common Units, $.01 par value per unit	259,867,356 units

DUKE REALTY LIMITED PARTNERSHIP

INDEX

		Page
Part I - Financial Information
Item 1.	Financial Statements
	Consolidated Balance Sheets as of June 30, 2011 (Unaudited) and December 31, 2010		2
	Consolidated Statements of Operations (Unaudited) for the three and six months ended June 30, 2011 and 2010		3
	Consolidated Statements of Cash Flows (Unaudited) for the six months ended June 30, 2011 and 2010		4
	Consolidated Statement of Changes in Equity (Unaudited) for the six months ended June 30, 2011		5
	Notes to Consolidated Financial Statements (Unaudited)		6-15
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		16-32
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		32-33
Item 4.	Controls and Procedures		33
Part II - Other Information
Item 1.	Legal Proceedings		34
Item 1A.	Risk Factors		34
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		34
Item 3.	Defaults Upon Senior Securities		35
Item 4.	Reserved		35
Item 5.	Other Information		35
Item 6.	Exhibits		35-36

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

Consolidated Balance Sheets

(in thousands)

	June 30, 2011			December 31, 2010
	(unaudited)
ASSETS
Real estate investments:
Land and improvements	$	1,276,820		$	1,166,409
Buildings and tenant improvements		5,525,808			5,396,339
Construction in progress		70,424			61,205
Investments in and advances to unconsolidated companies		365,323			367,445
Undeveloped land		617,470			625,353
		7,855,845			7,616,751
Accumulated depreciation		(1,381,919	)		(1,290,417	)
Net real estate investments		6,473,926			6,326,334
Real estate investments and other assets held-for-sale		—			394,287
Cash and cash equivalents		117,645			18,419
Accounts receivable, net of allowance of $3,802 and $2,945		24,741			22,588
Straight-line rent receivable, net of allowance of $7,924 and $7,260		136,171			125,185
Receivables on construction contracts, including retentions		48,263			7,408
Deferred financing costs, net of accumulated amortization of $52,844 and $46,407		42,223			46,317
Deferred leasing and other costs, net of accumulated amortization of $313,986 and $269,000		497,174			517,934
Escrow deposits and other assets		186,562			185,652
	$	7,526,705		$	7,644,124
LIABILITIES AND EQUITY
Indebtedness:
Secured debt	$	1,187,044		$	1,065,628
Unsecured notes		2,906,154			2,948,405
Unsecured lines of credit		18,329			193,046
		4,111,527			4,207,079
Liabilities related to real estate investments held-for-sale		—			14,732
Construction payables and amounts due subcontractors, including retentions		67,757			44,782
Accrued real estate taxes		102,695			83,615
Accrued interest		62,046			62,407
Other accrued expenses		38,275			61,354
Other liabilities		136,336			129,860
Tenant security deposits and prepaid rents		53,391			50,450
Total liabilities		4,572,027			4,654,279
Partners’ equity:
General Partner:
Common equity (252,663 and 252,195 General Partner Units issued and outstanding)		1,986,945			2,046,617
Preferred equity (3,610 and 3,618 Preferred Units issued and outstanding)		902,540			904,540
		2,889,485			2,951,157
Limited Partners’ common equity (7,190 and 5,231 Limited Partner Units issued and outstanding)		60,175			34,894
Accumulated other comprehensive income (loss)		56			(1,432	)
Total partners’ equity		2,949,716			2,984,619
Noncontrolling interests		4,962			5,226
Total equity		2,954,678			2,989,845
	$	7,526,705		$	7,644,124

See accompanying Notes to Consolidated Financial Statements

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DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

Consolidated Statements of Operations

For the three and six months ended June 30,

(in thousands, except per unit amounts)

(Unaudited)

	Three Months Ended						Six Months Ended
	2011			2010			2011			2010
Revenues:
Rental and related revenue	$	227,708		$	205,588		$	467,744		$	417,084
General contractor and service fee revenue		135,362			168,398			281,909			282,039
		363,070			373,986			749,653			699,123
Expenses:
Rental expenses		47,153			45,446			103,939			96,575
Real estate taxes		33,647			27,489			68,591			55,915
General contractor and other services expenses		122,969			160,617			258,633			267,779
Depreciation and amortization		100,058			78,956			194,743			159,481
		303,827			312,508			625,906			579,750
Other operating activities:
Equity in earnings of unconsolidated companies		1,713			2,016			2,786			6,945
Gain on sale of properties		493			4,973			68,348			7,042
Undeveloped land carrying costs		(2,453	)		(2,542	)		(4,762	)		(4,793	)
Impairment charges		—			(7,974	)		—			(7,974	)
Other operating expenses		(26	)		(145	)		(111	)		(422	)
General and administrative expense		(8,541	)		(9,151	)		(19,738	)		(22,695	)
		(8,814	)		(12,823	)		46,523			(21,897	)
Operating income		50,429			48,655			170,270			97,476
Other income (expenses):
Interest and other income, net		284			204			371			355
Interest expense		(66,846	)		(58,044	)		(132,950	)		(114,300	)
Loss on debt transactions		—			(15,773	)		—			(16,127	)
Acquisition costs		(594	)		—			(1,183	)		—
Income (loss) from continuing operations		(16,727	)		(24,958	)		36,508			(32,596	)
Discontinued operations:
Income before gain on sales		157			1,240			107			1,748
Gain on sale of depreciable properties		2,712			3,078			14,316			12,856
Income from discontinued operations		2,869			4,318			14,423			14,604
Net income (loss)		(13,858	)		(20,640	)		50,931			(17,992	)
Distributions on Preferred Units		(15,974	)		(18,363	)		(31,948	)		(36,726	)
Adjustments for repurchase of Preferred Units		—			(4,492	)		(163	)		(4,492	)
Net (income) loss attributable to noncontrolling interests		84			(108	)		206			(106	)
Net income (loss) attributable to common unitholders	$	(29,748	)	$	(43,603	)	$	19,026		$	(59,316	)
Basic net income (loss) per Common Unit:
Continuing operations attributable to common unitholders	$	(0.13	)	$	(0.21	)	$	0.01		$	(0.32	)
Discontinued operations attributable to common unitholders		0.01			0.02			0.06			0.06
Total	$	(0.12	)	$	(0.19	)	$	0.07		$	(0.26	)
Diluted net income (loss) per Common Unit:
Continuing operations attributable to common unitholders	$	(0.13	)	$	(0.21	)	$	0.01		$	(0.32	)
Discontinued operations attributable to common unitholders		0.01			0.02			0.06			0.06
Total	$	(0.12	)	$	(0.19	)	$	0.07		$	(0.26	)
Weighted average number of Common Units outstanding		259,849			233,486			259,322			232,130
Weighted average number of Common Units and potential dilutive securities		259,849			233,486			259,390			232,130

See accompanying Notes to Consolidated Financial Statements

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DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the six months ended June 30,

(in thousands)

(Unaudited)

	2011			2010
Cash flows from operating activities:
Net income (loss)	$	50,931		$	(17,992	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation of buildings and tenant improvements		135,809			130,236
Amortization of deferred leasing and other costs		59,285			35,937
Amortization of deferred financing costs		7,351			7,092
Straight-line rent adjustment		(11,887	)		(9,083	)
Impairment charges		—			7,974
Loss on debt extinguishment		—			16,127
Earnings from land and depreciated property sales		(82,664	)		(19,898	)
Third-party construction contracts, net		(25,658	)		(17,407	)
Other accrued revenues and expenses, net		264			12,737
Operating distributions received in excess of equity in earnings from unconsolidated companies		10,862			2,597
Net cash provided by operating activities		144,293			148,320
Cash flows from investing activities:
Development of real estate investments		(78,645	)		(56,762	)
Acquisition of real estate investments and related intangible assets, net of cash acquired		(99,817	)		(19,205	)
Acquisition of undeveloped land		—			(4,706	)
Second generation tenant improvements, leasing costs and building improvements		(41,284	)		(34,805	)
Other deferred leasing costs		(13,807	)		(16,752	)
Other assets		3,149			(28,699	)
Proceeds from land and depreciated property sales, net		498,249			151,835
Capital distributions from unconsolidated companies		54,730			3,897
Capital contributions and advances to unconsolidated companies, net		(16,917	)		(16,577	)
Net cash provided by (used for) investing activities		305,658			(21,774	)
Cash flows from financing activities:
Contributions from the General Partner		—			298,066
Payments for repurchases of Preferred Units		(2,096	)		(58,304	)
Proceeds from unsecured debt issuance		—			250,000
Payments on and repurchases of unsecured debt		(43,377	)		(387,860	)
Proceeds from secured debt financings		—			4,160
Payments on secured indebtedness including principal amortization		(7,968	)		(5,317	)
Borrowings (payments) on lines of credit, net		(174,717	)		313
Distributions to common unitholders		(88,219	)		(78,528	)
Distributions to preferred unitholders		(31,948	)		(36,726	)
Distributions to noncontrolling interests		(58	)		(1,631	)
Deferred financing costs		(2,342	)		(1,970	)
Net cash used for financing activities		(350,725	)		(17,797	)
Net increase in cash and cash equivalents		99,226			108,749
Cash and cash equivalents at beginning of period		18,419			147,539
Cash and cash equivalents at end of period	$	117,645		$	256,288
Non-cash investing and financing activities:
Assumption of indebtedness for real estate acquisitions	$	130,474		$	4,503
Contribution of properties to unconsolidated companies	$	52,868		$	7,002
Conversion of Limited Partner Units to common shares of the General Partner	$	1,235		$	4,335
Issuance of Limited Partner Units for acquisition	$	28,357		$	—

See accompanying Notes to Consolidated Financial Statements

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DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

Consolidated Statement of Changes in Equity

For the six months ended June 30, 2011

(in thousands, except per unit data)

(Unaudited)

	Common Unitholders
	General Partner						Limited Partners’			Accumulated Other			Total
	Common Equity			Preferred Equity			Common Equity			Comprehensive Income (Loss)			Partners’ Equity			Noncontrolling Interests			Total Equity
Balance at December 31, 2010	$	2,046,617		$	904,540		$	34,894		$	(1,432	)	$	2,984,619		$	5,226		$	2,989,845
Comprehensive income:
Net income		18,690			31,948			499			—			51,137			(206	)		50,931
Derivative instrument activity		—			—			—			1,488			1,488			—			1,488
Comprehensive income														52,625			(206	)		52,419
Issuance of Limited Partner Units for acquisition		—			—			28,357			—			28,357						28,357
Conversion of Limited Partner Units to common shares of the General Partner		1,235			—			(1,235	)		—			—			—			—
Repurchase of Preferred Units		(96	)		(2,000	)								(2,096	)					(2,096	)
Stock based compensation plan activity		6,378			—			—			—			6,378			—			6,378
Distributions to Preferred Unitholders		—			(31,948	)		—			—			(31,948	)		—			(31,948	)
Distributions to Partners
($.34 per Common Unit)		(85,879	)		—			(2,340	)		—			(88,219	)		—			(88,219	)
Distributions to noncontrolling interests		—			—			—			—			—			(58	)		(58	)
Balance at June 30, 2011	$	1,986,945		$	902,540		$	60,175		$	56		$	2,949,716		$	4,962		$	2,954,678
Common Units outstanding at June 30, 2011		252,663						7,190						259,853

See accompanying Notes to Consolidated Financial Statements

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DUKE REALTY LIMITED PARTNERSHIP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. General Basis of Presentation

The interim consolidated financial statements included herein have been prepared by Duke Realty Limited Partnership (the “Partnership”). The 2010 year-end consolidated balance sheet data included in this Quarterly Report on Form 10-Q (this “Report”) was derived from the audited financial statements in our Annual Report on Form 10-K for the year ended December 31, 2010, but does not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”). The financial statements have been prepared in accordance with GAAP for interim financial information and in accordance with Rule 10-01 of Regulation S-X of the Securities Exchange Act of 1934, as amended. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and revenue and expenses during the reporting period. Our actual results could differ from those estimates and assumptions. These financial statements should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations included herein and the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2010.

The Partnership was formed on October 4, 1993, when Duke Realty Corporation (the “General Partner”) contributed all of its properties and related assets and liabilities, together with the net proceeds from an offering of additional shares of its common stock, to the Partnership. Simultaneously, the Partnership completed the acquisition of Duke Associates, a full-service commercial real estate firm operating in the Midwest. The General Partner was formed in 1985 and we believe that it qualifies as a real estate investment trust (“REIT”) under the provisions of the Internal Revenue Code of 1986, as amended (the “Code”). The General Partner is the sole general partner of the Partnership owning 97.2% of the common Partnership interests as of June 30, 2011 (“General Partner Units”). The remaining 2.8% of the Partnership’s common interest is owned by limited partners (“Limited Partner Units” and, together with the General Partner Units, the “Common Units”). Limited Partners have the right to redeem their Limited Partner Units, subject to certain restrictions. Pursuant to the Partnership’s Partnership Agreement (the “Partnership Agreement”), the General Partner is obligated to redeem the Limited Partner Units in shares of its common stock, unless it determines in its reasonable discretion that the issuance of shares of its common stock could cause it to fail to qualify as a REIT. Each Limited Partner Unit shall be redeemed for one share of the General Partner’s common stock, or, in the event that the issuance of shares could cause the General Partner to fail to qualify as a REIT, cash equal to the fair market value of one share of the General Partner’s common stock at the time of redemption, in each case, subject to certain adjustments described in the Partnership Agreement. The Limited Partner Units are not required, per the terms of the Partnership Agreement, to be redeemed in registered shares of the General Partner. The General Partner also owns preferred partnership interests in the Partnership (“Preferred Units”).

We own and operate a real estate portfolio primarily consisting of industrial and office properties and provide real estate services to third-party owners. We conduct our Service Operations (see Note 9) through Duke Realty Services LLC, Duke Realty Services Limited Partnership and Duke Construction Limited Partnership (“DCLP”). DCLP is owned through a taxable REIT subsidiary. The consolidated financial statements include our accounts and the accounts of our majority-owned or controlled subsidiaries. In this Report,

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unless the context indicates otherwise, the terms “we,” “us” and “our” refer to the Partnership and those entities owned or controlled by the Partnership.

2. Reclassifications

Certain amounts in the accompanying consolidated financial statements for 2010 have been reclassified to conform to the 2011 consolidated financial statement presentation.

3. Variable Interest Entities

At June 30, 2011, there are four unconsolidated joint ventures that we have determined meet the criteria to be considered variable interest entities (“VIEs”). These four unconsolidated joint ventures were formed with the sole purpose of developing, constructing, leasing, marketing and selling or operating properties. The business activities of these unconsolidated joint ventures have been financed through a combination of equity contributions, partner/member loans, and third-party debt that is guaranteed by both us and the other partner/member of each entity. All significant decisions for these unconsolidated joint ventures, including those decisions that most significantly impact each venture’s economic performance, require unanimous approval of each joint venture’s partners or members. In certain cases, these decisions also require lender approval. Unanimous approval requirements for these unconsolidated joint ventures include entering into new leases, setting annual operating budgets, selling underlying properties, and incurring additional indebtedness. Because no single entity exercises control over the decisions that most significantly affect each joint venture’s economic performance, we determined that the equity method of accounting is appropriate.

The following is a summary of the carrying value in our consolidated balance sheet, as well as our maximum loss exposure under guarantees for the four unconsolidated subsidiaries that we have determined to be VIEs as of June 30, 2011:

	Carrying Value		Maximum Loss Exposure
Investment in Unconsolidated Company	$	38.3 million	$	38.3 million
Guarantee Obligations (1)	$	(22.9 million)	$	(62.4 million)

(1) We are party to guarantees of the third-party debt of these joint ventures and our maximum loss exposure is equal to the maximum monetary obligation pursuant to the guarantee agreements. In 2009, we recorded a liability for our probable future obligation under a guarantee to the lender of one of these ventures. Pursuant to an agreement with the lender, we may make partner loans to this joint venture that will reduce our maximum guarantee obligation on a dollar-for-dollar basis. The carrying value of our recorded guarantee obligations is included in other liabilities in our Consolidated Balance Sheets.

4. Acquisitions and Dispositions

Acquisition of Premier Portfolio

We purchased twelve industrial and four office buildings, as well as other real estate assets, during the six months ended June 30, 2011. These purchases completed our acquisition of a portfolio of buildings in South Florida (the “Premier Portfolio”), which was placed under contract in 2010, and resulted in cash payments to the sellers of $27.4 million, the assumption of secured loans with a face value of $124.4 million (Note 5) and the issuance to the sellers of 2.1 million Limited Partner Units with a fair value at issuance of $28.4 million, which are included in the Limited Partners’ common equity (Note 6). These units are not convertible until early 2012.

On December 30, 2010, we purchased 38 industrial buildings, one office building and other real estate assets within the Premier Portfolio. The allocation of the fair value of the amounts recognized from this acquisition to buildings and other related assets was preliminary at December 31, 2010. The following table summarizes our allocation of the fair value of amounts recognized for each major class of assets and liabilities related to the 55 properties and other real estate assets from the Premier Portfolio that have been purchased through June 30, 2011 (in thousands):

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	Year ended December 31, 2010		Six months ended June 30, 2011		Total acquired through June 30, 2011
Real estate assets	$	249,960	$	153,656	$	403,616
Lease-related intangible assets		31,091		25,445		56,536
Other assets		1,801		2,571		4,372
Total acquired assets		282,852		181,672		464,524
Secured debt		158,238		125,003		283,241
Other liabilities		4,075		4,284		8,359
Total assumed liabilities		162,313		129,287		291,600
Fair value of acquired net assets	$	120,539	$	52,385	$	172,924

The leases in the acquired properties had a weighted average remaining life at acquisition of approximately 3.5 years.

Other 2011 Acquisitions

We also acquired four additional properties during the six months ended June 30, 2011. These acquisitions consisted of one bulk industrial property in Southern California, one bulk industrial property in Phoenix, Arizona, one bulk industrial property in Savannah, Georgia and one office property in Atlanta, Georgia. The following table summarizes our allocation of the fair value of amounts recognized for each major class of assets and liabilities (in thousands) for these acquisitions:

Real estate assets	$	70,547
Lease related intangible assets		9,491
Other assets		194
Total acquired assets		80,232
Secured debt		5,470
Other liabilities		311
Total assumed liabilities		5,781
Fair value of acquired net assets	$	74,451

The leases in the acquired properties had a weighted average remaining life at acquisition of approximately 5.9 years.

Fair Value Measurements

The fair value estimates used in allocating the aggregate purchase price of each acquisition among the individual components of real estate assets and liabilities were determined primarily through calculating the “as-if vacant” value of each building, using the income approach, and relied significantly upon internally determined assumptions. As a result, we have, thus, determined these estimates to have been primarily based upon Level 3 inputs, which are unobservable inputs based on our own assumptions. The most significant assumptions utilized in making the lease-up and future disposition estimates used in calculating the “as-if vacant” value of each building acquired during the six months ended June 30, 2011 were as follows:

Discount rate		6.4% - 10.0%
Exit capitalization rate		4.8% - 8.7%
Lease- up period		12 -36 months
Net rental rate per square foot – Industrial	$	3.30 - $6.50
Net rental rate per square foot – Office	$	8.61 - $16.00

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Dispositions

We disposed of income-producing real estate assets and undeveloped land and received net proceeds of $498.2 million during the six-month period ended June 30, 2011. Included in the building dispositions in the six months ended June 30, 2011 is the sale, in March 2011, of 13 suburban office buildings, totaling approximately 2.0 million square feet, to an existing 20% owned unconsolidated joint venture. These buildings were sold to the unconsolidated joint venture for $342.8 million and our share of net proceeds totaled $273.7 million.

5. Indebtedness

The following table summarizes the book value and changes in the fair value of our debt for the six months ended June 30, 2011 (in thousands):

	Book Value at 12/31/10		Book Value at 6/30/11		Fair Value at 12/31/10		Issuances and Assumptions		Payoffs			Adjustments to Fair Value			Fair Value at 6/30/11
Fixed rate secured debt	$	1,042,722	$	1,164,138	$	1,069,562	$	129,831	$	(7,968	)	$	38,042		$	1,229,467
Variable rate secured debt		22,906		22,906		22,906		—		—			—			22,906
Fixed rate unsecured notes		2,948,405		2,906,154		3,164,651		—		(43,377	)		53,435			3,174,709
Unsecured lines of credit		193,046		18,329		193,224		283		(175,000	)		(390	)		18,117
Total	$	4,207,079	$	4,111,527	$	4,450,343	$	130,114	$	(226,345	)	$	91,087		$	4,445,199

Fixed Rate Secured Debt

Because our fixed rate secured debt is not actively traded in any marketplace, we utilized a discounted cash flow methodology to determine its fair value. Accordingly, we calculated fair value by applying an estimate of the current market rate to discount the debt’s remaining contractual cash flows. Our estimate of a current market rate, which is the most significant input in the discounted cash flow calculation, is intended to replicate debt of similar maturity and loan-to-value relationship. The estimated rates ranged from 4.10% to 5.80%, depending on the attributes of the specific loans. The current market rates we utilized were internally estimated; therefore, we have concluded that our determination of fair value for our fixed rate secured debt was primarily based upon Level 3 inputs, as defined.

In the first six months of 2011, we assumed nine secured loans associated with the acquisition of the Premier Portfolio, which had a total acquisition date face value of $124.4 million and fair value of $125.0 million. The assumed loans carry a weighted average interest rate of 5.78% and a weighted remaining term upon acquisition of 5.0 years. We used estimated market rates ranging between 4.40% and 5.81% in determining the fair value of the loans.

Fixed Rate Unsecured Debt

In March 2011, we repaid $42.5 million of senior unsecured notes, which had an effective interest rate of 6.96%, at their scheduled maturity date.

We utilized broker estimates in estimating the fair value of our fixed rate unsecured debt. Our unsecured notes are thinly traded and, in certain cases, the broker estimates were not based upon comparable transactions. The broker estimates took into account any recent trades within the same series of our fixed rate unsecured debt, comparisons to recent trades of other series of our fixed rate unsecured debt, trades of fixed rate unsecured debt from companies with profiles similar to ours, as well as overall economic conditions. We reviewed these broker estimates for reasonableness and accuracy, considering whether the estimates were based upon market participant assumptions within the principal and most advantageous market and whether any other observable inputs would be more accurate indicators of fair value than the broker estimates. We concluded that the broker estimates were representative of fair value. We have

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determined that our estimation of the fair value of our fixed rate unsecured debt was primarily based upon Level 3 inputs, as defined. The estimated trading values of our fixed rate unsecured debt, depending on the maturity and coupon rates, ranged from 100.0% to 121.0% of face value.

The indentures (and related supplemental indentures) governing our outstanding series of notes also require us to comply with financial ratios and other covenants regarding our operations. We were in compliance with all such covenants as of June 30, 2011.

Unsecured Lines of Credit

Our unsecured lines of credit as of June 30, 2011 are described as follows (in thousands):

Description	Maximum Capacity		Maturity Date		Outstanding Balance at June 30, 2011
Unsecured Line of Credit - Partnership	$	850,000		February 2013	$	—
Unsecured Line of Credit - Consolidated Subsidiary	$	30,000		July 2012	$	18,329

The Partnership’s unsecured line of credit has an interest rate on borrowings of LIBOR plus 2.75%, and a maturity date of February 2013. There were no borrowings on the Partnership’s unsecured line of credit at June 30, 2011. Subject to certain conditions, the terms also include an option to increase the facility by up to an additional $200.0 million, for a total of up to $1.05 billion.

This line of credit provides us with an option to obtain borrowings from financial institutions that participate in the line at rates that may be lower than the stated interest rate, subject to certain restrictions.

This line of credit contains financial covenants that require us to meet certain financial ratios and defined levels of performance, including those related to fixed charge coverage and debt-to-asset value (with asset value being defined in the Partnership’s unsecured line of credit agreement). As of June 30, 2011, we were in compliance with all covenants under this line of credit.

The consolidated subsidiary’s unsecured line of credit allows for borrowings up to $30.0 million at a rate of LIBOR plus .85% (equal to 1.04% for outstanding borrowings as of June 30, 2011). This unsecured line of credit is used to fund development activities within the consolidated subsidiary and matures in July 2012.

To the extent that there are outstanding borrowings, we utilize a discounted cash flow methodology in order to estimate the fair value of our unsecured lines of credit. The net present value of the difference between future contractual interest payments and future interest payments based on our estimate of a current market rate represents the difference between the book value and the fair value. Our estimate of a current market rate is based upon the rate, considering current market conditions and our specific credit profile, at which we estimate we could obtain similar borrowings. The current market rate of 2.19% that we utilized was internally estimated; therefore, we have concluded that our determination of fair value for our unsecured lines of credit was primarily based upon Level 3 inputs, as defined.

6. Partners’ Equity

In the first six months of 2011, the General Partner repurchased 80,000 shares of its 8.375% Series O Cumulative Redeemable Preferred Shares (“Series O Shares”). The Series O Shares that the General Partner repurchased had a total redemption value of $2.0 million and were repurchased for $2.1 million. We then repurchased corresponding Preferred Units held by the General Partner at the same price at which it repurchased its preferred shares on the open market. An adjustment of approximately $163,000, which included a ratable portion of issuance costs, was included in net income attributable to common unitholders.

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In conjunction with the acquisition of the Premier Portfolio (Note 4), we issued 2.1 million Limited Partner Units with a fair value at issuance of $28.4 million, which are included in Limited Partners’ common equity.

7. Related Party Transactions

We provide property management, asset management, leasing, construction and other tenant related services to unconsolidated companies in which we have equity interests. We recorded the corresponding fees based on contractual terms that approximate market rates for these types of services and we have eliminated our ownership percentage of these fees in the consolidated financial statements. The following table summarizes the fees earned from these companies for the six months ended June 30, 2011 and 2010, respectively (in thousands):

	Six Months Ended June 30,
	2011		2010
Management fees	$	4,623	$	4,142
Leasing fees		2,801		1,105
Construction and development fees		2,396		4,036

8. Net Income (Loss) Per Common Unit

Basic net income (loss) per Common Unit is computed by dividing net income (loss) attributable to common unitholders, less distributions on share-based awards expected to vest (referred to as “participating securities” and primarily composed of unvested restricted stock units), by the weighted average number of Common Units outstanding for the period. Diluted net income (loss) per Common Unit is computed by dividing basic net income (loss) attributable to common unitholders by the sum of the weighted average number of Common Units outstanding and any potential dilutive securities for the period.

The following table reconciles the components of basic and diluted net income (loss) per Common Unit for the three and six months ended June 30, 2011 and 2010, respectively (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Net income (loss) attributable to common unitholders	$	(29,748	)	$	(43,603	)	$	19,026		$	(59,316	)
Less: Distributions on participating securities		(806	)		(505	)		(1,605	)		(1,005	)
Basic and diluted net income (loss) attributable to common unitholders	$	(30,554	)	$	(44,108	)	$	17,421		$	(60,321	)
Weighted average number of Common Units outstanding		259,849			233,486			259,322			232,130
Other potential dilutive units		—			—			68			—
Weighted average number of Common Units and potential dilutive securities		259,849			233,486			259,390			232,130

Potential units related to the majority of our stock-based compensation plans as well as our 3.75% Exchangeable Senior Notes (“Exchangeable Notes”) are anti-dilutive for all periods presented. The following table summarizes the data that is excluded from the computation of net income (loss) per Common Unit as a result of being anti-dilutive (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2011		2010		2011		2010
Anti-dilutive outstanding potential units under fixed stock option plans		1,677		1,787		1,677		1,787
Anti-dilutive potential units under the Exchangeable Notes		3,432		4,335		3,432		4,335
Outstanding participating securities		4,816		4,188		4,816		4,188

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9. Segment Reporting

We have three reportable operating segments, the first two of which consist of the ownership and rental of (i) office and (ii) industrial real estate investments. The operations of our office and industrial properties, along with our medical office and retail properties, are collectively referred to as “Rental Operations.” Our medical office and retail properties do not by themselves meet the quantitative thresholds for separate presentation as reportable segments. The third reportable segment consists of various real estate services such as property management, asset management, maintenance, leasing, development and construction management to third-party property owners and joint ventures, and is collectively referred to as “Service Operations.” Our reportable segments offer different products or services and are managed separately because each segment requires different operating strategies and management expertise.

Other revenue consists of other operating revenues not identified with one of our operating segments. Interest expense and other non-property specific revenues and expenses are not allocated to individual segments in determining our performance measure.

We assess and measure our overall operating results based upon an industry performance measure referred to as Funds From Operations (“FFO”), which management believes is a useful indicator of our consolidated operating performance. FFO is used by industry analysts and investors as a supplemental operating performance measure of a REIT like our General Partner. The National Association of Real Estate Investment Trusts (“NAREIT”) created FFO as a supplemental measure of REIT operating performance that excludes historical cost depreciation, among other items, from net income determined in accordance with GAAP. FFO is a non-GAAP financial measure. The most comparable GAAP measure is net income (loss) attributable to common unitholders. FFO attributable to common unitholders should not be considered as a substitute for net income (loss) attributable to common unitholders or any other measures derived in accordance with GAAP and may not be comparable to other similarly titled measures of other companies. FFO is calculated in accordance with the definition that was adopted by the Board of Governors of NAREIT. We do not allocate certain income and expenses (“Non-Segment Items”, as shown in the table below) to our operating segments. Thus, the operational performance measure presented here on a segment-level basis represents net earnings excluding depreciation expense and the Non-Segment Items not allocated, and is not meant to present FFO as defined by NAREIT.

Historical cost accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, many industry analysts and investors have considered presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. FFO, as defined by NAREIT, represents GAAP net income (loss), excluding extraordinary items as defined under GAAP and gains or losses from sales of previously depreciated real estate assets, plus certain non-cash items such as real estate asset depreciation and amortization and after similar adjustments for unconsolidated partnerships and joint ventures.

Management believes that the use of FFO attributable to common unitholders, combined with net income (which remains the primary measure of performance), improves the understanding of operating results of REITs among the investing public and makes comparisons of REIT operating results more meaningful. Management believes that excluding gains or losses related to sales of previously depreciated real estate assets and excluding real estate asset depreciation and amortization enables investors and analysts to readily identify the operating results of the long-term assets that form the core of a REIT’s activity and assist them in comparing these operating results between periods or between different companies.

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The following table shows (i) the revenues for each of the reportable segments and (ii) a reconciliation of FFO attributable to common unitholders to net income (loss) attributable to common unitholders for the three and six months ended June 30, 2011 and 2010, respectively (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Revenues
Rental Operations:
Office	$	109,671		$	122,790		$	231,787		$	249,703
Industrial		95,062			62,499			191,345			128,583
Non-reportable Rental Operations segments		19,710			16,725			39,364			32,958
General contractor and service fee revenue (“Service Operations”)		135,362			168,398			281,909			282,039
Total Segment Revenues		359,805			370,412			744,405			693,283
Other Revenue		3,265			3,574			5,248			5,840
Consolidated Revenue from continuing operations		363,070			373,986			749,653			699,123
Discontinued Operations		365			11,234			3,485			23,997
Consolidated Revenue	$	363,435		$	385,220		$	753,138		$	723,120
Reconciliation of Funds From Operations
Net earnings excluding depreciation and Non-Segment Items
Office	$	63,250		$	71,588		$	130,376		$	142,867
Industrial		69,093			47,515			136,918			95,850
Non-reportable Rental Operations segments		13,024			11,577			25,398			22,155
Service Operations		12,393			7,781			23,276			14,260
		157,760			138,461			315,968			275,132
Non-Segment Items:
Interest expense		(66,846	)		(58,044	)		(132,950	)		(114,300	)
Impairment charges		—			(7,974	)		—			(7,974	)
Interest and other income		284			204			371			355
Other operating expenses		(26	)		(145	)		(111	)		(422	)
General and administrative expenses		(8,541	)		(9,151	)		(19,738	)		(22,695	)
Undeveloped land carrying costs		(2,453	)		(2,542	)		(4,762	)		(4,793	)
Loss on debt transactions		—			(15,773	)		—			(16,127	)
Acquisition costs		(594	)		—			(1,183	)		—
Other non-segment income		1,541			1,973			2,522			3,722
Net (income) loss attributable to noncontrolling interests		84			(108	)		206			(106	)
Joint venture items		10,352			12,384			18,962			24,572
Distributions on Preferred Units		(15,974	)		(18,363	)		(31,948	)		(36,726	)
Adjustments for repurchase of Preferred Units		—			(4,492	)		(163	)		(4,492	)
Discontinued operations		212			4,289			458			8,440
FFO attributable to common unitholders		75,799			40,719			147,632			104,586
Depreciation and amortization on continuing operations		(100,058	)		(78,956	)		(194,743	)		(159,481	)
Depreciation and amortization on discontinued operations		(55	)		(3,049	)		(351	)		(6,692	)
Partnership’s share of joint venture adjustments		(8,639	)		(10,372	)		(16,267	)		(19,935	)
Earnings from depreciated property sales on continuing operations		493			4,973			68,348			7,042
Earnings from depreciated property sales on discontinued operations		2,712			3,078			14,316			12,856
Earnings from depreciated property sales - share of joint venture		—			4			91			2,308
Net income (loss) attributable to common unitholders	$	(29,748	)	$	(43,603	)	$	19,026		$	(59,316	)

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The assets for each of the reportable segments as of June 30, 2011 and December 31, 2010 are as follows (in thousands):

	June 30, 2011		December 31, 2010
Assets
Rental Operations:
Office	$	2,769,228	$	3,122,565
Industrial		3,314,481		3,210,566
Non-reportable Rental Operations segments		634,058		627,491
Service Operations		169,559		231,662
Total Segment Assets		6,887,326		7,192,284
Non-Segment Assets		639,379		451,840
Consolidated Assets	$	7,526,705	$	7,644,124

10. Discontinued Operations

The following table illustrates the number of properties in discontinued operations:

	Sold in 2011		Sold in 2010		Total
Office		10		11		21
Industrial		2		6		8
Retail		—		2		2
		12		19		31

We allocate interest expense to discontinued operations and have included such interest expense in computing income from discontinued operations. Interest expense allocable to discontinued operations includes interest on any secured debt for properties included in discontinued operations and an allocable share of our consolidated unsecured interest expense for unencumbered properties. The allocation of unsecured interest expense to discontinued operations was based upon the gross book value of the unencumbered real estate assets included in discontinued operations as it related to the total gross book value of our unencumbered real estate assets.

The following table illustrates the operations of the buildings reflected in discontinued operations for the three and six months ended June 30, 2011 and 2010, respectively (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Revenues	$	365		$	11,234		$	3,485		$	23,997
Operating expenses		(74	)		(4,118	)		(1,787	)		(9,301	)
Depreciation and amortization		(55	)		(3,049	)		(351	)		(6,692	)
Operating income		236			4,067			1,347			8,004
Interest expense		(79	)		(2,827	)		(1,240	)		(6,256	)
Income before gain on sales		157			1,240			107			1,748
Gain on sale of depreciable properties		2,712			3,078			14,316			12,856
Income from discontinued operations	$	2,869		$	4,318		$	14,423		$	14,604

The income from discontinued operations for all periods presented is entirely attributable to the common unitholders.

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11. Subsequent Events

Declaration of Distributions

The General Partner’s board of directors declared the following distributions at its regularly scheduled board meeting held on July 27, 2011:

Class	Quarterly Amount/Unit		Record Date		Payment Date
Common	$	0.17		August 17, 2011		August 31, 2011
Preferred (per depositary unit):
Series J	$	0.414063		August 17, 2011		August 31, 2011
Series K	$	0.406250		August 17, 2011		August 31, 2011
Series L	$	0.412500		August 17, 2011		August 31, 2011
Series M	$	0.434375		September 16, 2011		September 30, 2011
Series O	$	0.523438		September 16, 2011		September 30, 2011

On June 17, 2011, the General Partner called for redemption all of its 434,520 outstanding 7.25% Series N Cumulative Redeemable Preferred Shares. The redemption took place on July 18, 2011 for $109.0 million, which included distributions accrued through the redemption date.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to help the reader understand our operations and our present business environment. Management’s Discussion and Analysis is provided as a supplement to and should be read in conjunction with our consolidated financial statements and the notes thereto, contained in Part I, Item I of this Quarterly Report on Form 10-Q (this “Report”) and the consolidated financial statements and notes thereto, contained in Part IV, Item 15 of our Annual Report on Form 10-K for the year ended December 31, 2010, as filed with the Securities and Exchange Commission (the “SEC”) on March 4, 2011. As used herein, the terms “we”, “us” and “our” refer to Duke Realty Limited Partnership (the “Partnership”) and those entities owned or controlled by the Partnership.

Cautionary Notice Regarding Forward-Looking Statements

Certain statements contained in or incorporated by reference into this Report including, without limitation, those related to our future operations, constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words “believe,” “estimate,” “expect,” “anticipate,” “intend,” “plan,” “seek,” “may” and similar expressions or statements regarding future periods are intended to identify forward-looking statements.

These forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause our actual results, performance or achievements, or industry results, to differ materially from any predictions of future results, performance or achievements that we express or imply in this Report. Some of the risks, uncertainties and other important factors that may affect future results include, among others:

• Changes in general economic and business conditions, including, without limitation, the continuing impact of the economic down-turn, which is having and may continue to have a negative effect on the fundamentals of our business, the financial condition of our tenants, and the value of our real estate assets;

• The General Partner’s continued qualification as a real estate investment trust (“REIT”) for U.S. federal income tax purposes;

• Heightened competition for tenants and potential decreases in property occupancy;

• Potential changes in the financial markets and interest rates;

• Volatility in the General Partner’s stock price and trading volume;

• Our continuing ability to raise funds on favorable terms;

• Our ability to successfully identify, acquire, develop and/or manage properties on terms that are favorable to us;

• Potential increases in real estate construction costs;

• Our ability to successfully dispose of properties on terms that are favorable to us, including, without limitation, through one or more transactions that are consistent with our previously disclosed strategic plans;

• Our ability to retain our current credit ratings;

• Inherent risks in the real estate business, including, but not limited to, tenant defaults, potential liability relating to environmental matters, climate change and liquidity of real estate investments; and

• Other risks and uncertainties described herein, as well as those risks and uncertainties discussed from time to time in the Partnership’s and General Partner’s other reports and other public filings with the SEC.

Although we presently believe that the plans, expectations and results expressed in or suggested by the forward-looking statements are reasonable, all forward-looking statements are inherently subjective, uncertain and

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subject to change, as they involve substantial risks and uncertainties beyond our control. New factors emerge from time to time, and it is not possible for us to predict the nature, or assess the potential impact, of each new factor on our business. Given these uncertainties, we caution you not to place undue reliance on these forward-looking statements. We undertake no obligation to update or revise any of our forward-looking statements for events or circumstances that arise after the statement is made, except as otherwise may be required by law.

This list of risks and uncertainties, however, is only a summary of some of the most important factors and is not intended to be exhaustive. Additional information regarding risk factors that may affect us is included under the caption “Risk Factors” in Part II, Item 1A of this Report, and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2010, which we filed with the SEC on March 4, 2011. The risk factors contained in our Annual Report are updated by us from time to time in Quarterly Reports on Form 10-Q and other public filings.

Business Overview

We are a limited partnership formed under the laws of the State of Indiana in 1993. We own and operate a real estate portfolio primarily consisting of industrial and office properties and provide real estate services to third-party owners. We conduct our Service Operations through Duke Realty Services, LLC, Duke Realty Services Limited Partnership and Duke Construction Limited Partnership. A more complete description of our business, and of management’s philosophy and priorities, is included in our 2010 Annual Report on Form 10-K.

As of June 30, 2011, we:

• Owned or jointly controlled 797 industrial, office, medical office and other properties, of which 790 properties with more than 138.6 million square feet are in service and seven properties with more than 2.0 million square feet are under development. The 790 in-service properties are comprised of 662 consolidated properties with approximately 113.0 million square feet and 128 jointly controlled unconsolidated properties with approximately 25.6 million square feet. The seven properties under development consist of six consolidated properties with more than 1.6 million square feet and one jointly controlled unconsolidated property with approximately 405,000 million square feet.

• Owned, including through ownership interests in unconsolidated joint ventures, approximately 4,700 acres of land and controlled an additional 1,650 acres through purchase options.

We have three reportable operating segments, the first two of which consist of the ownership and rental of (i) office and (ii) industrial real estate investments. The operations of our office and industrial properties, along with our medical office and retail properties, are collectively referred to as “Rental Operations.” Our medical office and retail properties do not by themselves meet the quantitative thresholds for separate presentation as reportable segments. The third reportable segment consists of various real estate services such as property management, asset management, maintenance, leasing, development and construction management to third-party property owners and joint ventures, and is collectively referred to as “Service Operations.” Our reportable segments offer different products or services and are managed separately because each segment requires different operating strategies and management expertise.

A key component of our overall strategy is to increase our investment in quality industrial properties in both existing and select new markets, expand our medical office portfolio nationally to take advantage of demographic trends and to reduce our investment in suburban office properties and other non-strategic assets.

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Key Performance Indicators

Our operating results depend primarily upon rental income from our Rental Operations. The following discussion highlights the areas of Rental Operations that we consider critical for future revenues.

Occupancy Analysis

Our ability to maintain high occupancy rates is a principal driver of maintaining and increasing rental revenue from continuing operations. The following table sets forth occupancy information regarding our in-service portfolio of consolidated rental properties as of June 30, 2011 and 2010, respectively (in thousands, except percentage data):

	Total Square Feet				Percent of Total Square Feet						Percent Occupied
Type	2011		2010		2011			2010			2011			2010
Industrial		84,112		56,320		74.4	%		62.9	%		90.5	%		91.9	%
Office		25,994		30,496		23.0	%		34.1	%		84.4	%		85.0	%
Other (Medical Office and Retail)		2,956		2,678		2.6	%		3.0	%		86.5	%		82.9	%
Total		113,062		89,494		100.0	%		100.0	%		89.0	%		89.2	%

Lease Expiration and Renewals

Our ability to maintain and improve occupancy rates primarily depends upon our continuing ability to re-lease expiring space. The following table reflects our consolidated in-service portfolio lease expiration schedule by property type as of June 30, 2011. The table indicates square footage and annualized net effective rents (based on June 2011 rental revenue) under expiring leases (in thousands, except percentage data):

	Total Portfolio								Industrial					Office					Other
Year of Expiration	Square Feet			Ann. Rent Revenue		% of Revenue			Square Feet			Ann. Rent Revenue		Square Feet			Ann. Rent Revenue		Square Feet			Ann. Rent Revenue
Remainder of 2011		4,981		$	30,738		5	%		3,604		$	14,388		1,344		$	15,912		33		$	438
2012		8,318			60,860		9	%		5,465			23,925		2,792			35,834		61			1,101
2013		15,411			98,015		15	%		11,845			47,801		3,517			49,291		49			923
2014		12,001			71,981		11	%		9,216			34,943		2,633			34,258		152			2,780
2015		12,874			73,449		11	%		10,111			38,509		2,735			34,339		28			601
2016		12,094			63,762		10	%		9,959			36,281		2,038			25,322		97			2,159
2017		8,156			48,405		8	%		6,504			24,417		1,351			17,655		301			6,333
2018		5,680			47,692		7	%		3,640			14,475		1,500			20,746		540			12,471
2019		4,088			39,263		6	%		2,227			9,924		1,593			22,796		268			6,543
2020		6,386			42,111		7	%		5,009			18,109		1,000			16,117		377			7,885
2021 and Thereafter		10,602			68,934		11	%		8,516			34,075		1,435			19,405		651			15,454
Total Leased		100,591		$	645,210		100	%		76,096		$	296,847		21,938		$	291,675		2,557		$	56,688
Total Portfolio
Square Feet		113,062								84,112					25,994					2,956
Percent Occupied		89.0	%							90.5	%				84.4	%				86.5	%

Within our consolidated properties, we renewed 51.5% and 60.5% of our leases up for renewal in the three and six months ended June 30, 2011, totaling more than 2.1 million and 5.0 million square feet, respectively. This compares to renewals of 81.5% and 83.4% for the three and six months ended June 30, 2010, which totaled approximately 2.8 million and 4.9 million square feet, respectively. Although our lease renewal percentage declined from the same periods in 2010, new leasing activity enabled us to maintain a consistent level of occupancy for our consolidated properties. There was a 2.7% and 3.0% decline in average contractual rents on these renewals in the three and six months ended June 30, 2011, respectively.

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The average term of renewals for the three and six months ended June 30, 2011 was 4.4 years for both periods, compared to 5.4 and 6.3 years for the three and six months ended June 30, 2010, respectively.

Acquisition and Disposition Activity

For the six months ended June 30, 2011, we acquired 20 properties and other real estate-related assets, for $257.7 million, with 16 of these 20 properties representing the completion of our acquisition of a portfolio of buildings in South Florida (the “Premier Portfolio”), of which the initial 39 properties were acquired on December 30, 2010. These acquisitions represent further advancement of our strategy to increase our concentration in industrial properties.

For the six months ended June 30, 2010, we acquired $24.0 million of industrial real estate properties comprised of two properties in South Florida and one in Phoenix, Arizona. Additionally, in the first six months of 2010, one of our unconsolidated joint ventures, in which we have a 20% equity interest, acquired two properties for $42.3 million. We contributed $8.6 million to the joint venture for our share of these acquisitions.

Net cash proceeds related to the dispositions of wholly owned undeveloped land and buildings totaled $498.2 million and $151.8 million for the six months ended June 30, 2011 and 2010, respectively. Included in the wholly owned building dispositions in the six months ended June 30, 2011 is the sale of 13 suburban office properties for net proceeds of $273.7 million, totaling approximately 2.0 million square feet, to a joint venture in which we own 20%.

Our share of proceeds from sales of properties within unconsolidated joint ventures in which we have less than a 100% interest totaled $4.7 million for the six months ended June 30, 2010. There were no such dispositions in the same period in 2011.

We regularly work to identify, consider and pursue opportunities to acquire and dispose of properties on an opportunistic basis and on a basis that is generally consistent with our strategic plans.

Development

At June 30, 2011, we had 2.0 million square feet of property under development with total estimated costs upon completion of $125.3 million compared to 823,000 square feet with total costs of $264.1 million at June 30, 2010. We have continued to limit our development projects to build-to-suit or partially pre-leased industrial properties and select medical office developments. The square footage and estimated costs include both consolidated and joint venture development activity at 100%.

The following table summarizes our properties under development as of June 30, 2011 (in thousands, except percentage data):

Ownership Type	Square Feet		Percent Leased			Total Estimated Project Costs		Total Incurred to Date		Amount Remaining to be Spent
Consolidated properties		1,613		94	%	$	105,696	$	56,396	$	49,300
Joint venture properties		405		100	%		19,609		9,770		9,839
Total		2,018		95	%	$	125,305	$	66,166	$	59,139

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Funds From Operations

Funds From Operations (“FFO”) is used by industry analysts and investors as a supplemental operating performance measure of a REIT like our General Partner. The National Association of Real Estate Investment Trusts (“NAREIT”) created FFO as a supplemental measure of REIT operating performance that excludes historical cost depreciation, among other items, from net income determined in accordance with accounting principles generally accepted in the United States of America (“GAAP”). FFO is a non-GAAP financial measure. The most comparable GAAP measure is net income (loss) attributable to common unitholders. FFO attributable to common unitholders should not be considered as a substitute for net income (loss) attributable to common unitholders or any other measures derived in accordance with GAAP and may not be comparable to other similarly titled measures of other companies. FFO is calculated in accordance with the definition that was adopted by the Board of Governors of NAREIT.

Historical cost accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, many industry analysts and investors have considered presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. FFO, as defined by NAREIT, represents GAAP net income (loss), excluding extraordinary items as defined under GAAP and gains or losses from sales of previously depreciated real estate assets, plus certain non-cash items such as real estate asset depreciation and amortization, and after similar adjustments for unconsolidated partnerships and joint ventures.

Management believes that the use of FFO attributable to common unitholders, combined with net income (which remains the primary measure of performance), improves the understanding of operating results of REITs among the investing public and makes comparisons of REIT operating results more meaningful. Management believes that excluding gains or losses related to sales of previously depreciated real estate assets and excluding real estate asset depreciation and amortization enables investors and analysts to readily identify the operating results of the long-term assets that form the core of a REIT’s activity and assist them in comparing these operating results between periods or between different companies.

The following table shows a reconciliation of net income (loss) attributable to common unitholders to the calculation of FFO attributable to common unitholders for the three and six months ended June 30, 2011 and 2010, respectively (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Net income (loss) attributable to common unitholders	$	(29,748	)	$	(43,603	)	$	19,026		$	(59,316	)
Adjustments:
Depreciation and amortization		100,113			82,005			195,094			166,173
Partnership’s share of joint venture depreciation and amortization		8,639			10,372			16,267			19,935
Earnings from depreciable property sales - wholly owned		(3,205	)		(8,051	)		(82,664	)		(19,898	)
Earnings from depreciable property sales - share of joint venture		—			(4	)		(91	)		(2,308	)
Funds From Operations attributable to common unitholders	$	75,799		$	40,719		$	147,632		$	104,586

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Results of Operations

A summary of our operating results and property statistics for the three and six months ended June 30, 2011 and 2010, respectively, is as follows (in thousands, except number of properties and per unit data):

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011		2010
Rental and related revenue	$	227,708		$	205,588		$	467,744	$	417,084
General contractor and service fee revenue		135,362			168,398			281,909		282,039
Operating income		50,429			48,655			170,270		97,476
Net income (loss) attributable to common unitholders		(29,748	)		(43,603	)		19,026		(59,316	)
Weighted average Common Units outstanding		259,849			233,486			259,322		232,130
Weighted average Common Units and potential dilutive securities		259,849			233,486			259,390		232,130
Basic income (loss) per Common Unit:
Continuing operations	$	(0.13	)	$	(0.21	)	$	0.01	$	(0.32	)
Discontinued operations	$	0.01		$	0.02		$	0.06	$	0.06
Diluted income (loss) per Common Unit:
Continuing operations	$	(0.13	)	$	(0.21	)	$	0.01	$	(0.32	)
Discontinued operations	$	0.01		$	0.02		$	0.06	$	0.06
Number of in-service consolidated properties at end of period		662			529			662		529
In-service consolidated square footage at end of period		113,062			89,494			113,062		89,494
Number of in-service joint venture properties at end of period		128			215			128		215
In-service joint venture square footage at end of period		25,571			43,820			25,571		43,820

Comparison of Three Months Ended June 30, 2011 to Three Months Ended June 30, 2010

Rental and Related Revenue

The following table sets forth rental and related revenue from continuing operations by reportable segment for the three months ended June 30, 2011 and 2010, respectively (in thousands):

	Three Months Ended June 30,
	2011		2010
Rental and Related Revenue:
Office	$	109,671	$	122,790
Industrial		95,062		62,499
Non-reportable segments		22,975		20,299
Total	$	227,708	$	205,588

The following factors contributed to these results:

• We acquired 71 properties, of which 62 were industrial, and placed five developments in service from January 1, 2010 to June 30, 2011, which provided incremental revenues of $18.9 million in the second quarter of 2011, as compared to the same period in 2010.

• We consolidated 106 industrial buildings as a result of acquiring our joint venture partner’s 50% interest in Dugan Realty, L.L.C. (“Dugan”) on July 1, 2010. The consolidation of these buildings resulted in an increase of $19.2 million in rental and related revenue for the three months ended June 30, 2011, as compared to the same period in 2010.

• We sold 23 office properties to an unconsolidated joint venture in 2010 and the first quarter of 2011, resulting in a $15.7 million decrease in rental and related revenue from continuing operations in the three months ended June 30, 2011.

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• The overall shift of revenues and income from office properties to industrial properties is consistent with our continuing strategy to increase our asset concentration in industrial properties while reducing our exposure to office properties.

Rental Expenses and Real Estate Taxes

The following table sets forth rental expenses and real estate taxes by reportable segment for the three months ended June 30, 2011 and 2010, respectively (in thousands):

	Three Months Ended June 30,
	2011		2010
Rental Expenses:
Office	$	30,312	$	34,692
Industrial		10,296		5,827
Non-reportable segments		6,545		4,927
Total	$	47,153	$	45,446
Real Estate Taxes:
Office	$	16,109	$	16,510
Industrial		15,673		9,157
Non-reportable segments		1,865		1,822
Total	$	33,647	$	27,489

Overall, rental expenses increased by $1.7 million in the second quarter of 2011, compared to the same period in 2010. We recognized incremental costs of $4.3 million associated with the additional 71 properties acquired (of which 62 were industrial) and five developments placed in service since January 1, 2010. The July 1, 2010 consolidation of 106 industrial buildings in Dugan also resulted in a $1.9 million increase in rental expense for industrial properties in the second quarter of 2011. Partially offsetting the impact of our acquisition and development activity was a decrease to rental expenses of $3.6 million related to 23 office properties that were sold to an unconsolidated joint venture during 2010 and the first quarter of 2011.

Overall, real estate taxes increased by $6.2 million in the second quarter of 2011, compared to the same period in 2010. The consolidation of the 106 industrial buildings in Dugan resulted in incremental real estate taxes of $3.7 million. There were also incremental costs of $3.6 million associated with the additional 71 properties acquired and five developments placed in service since January 1, 2010. The aforementioned increases were partially offset by a decrease of $2.5 million related to the 23 properties that were sold to a joint venture during 2010 and the first quarter of 2011. The remaining increase in real estate tax expense was the result of increased taxes on our existing properties.

Service Operations

The following table sets forth the components of the Service Operations reportable segment for the three months ended June 30, 2011 and 2010, respectively (in thousands):

	Three Months Ended June 30,
	2011			2010
Service Operations:
General contractor and service fee revenue	$	135,362		$	168,398
General contractor and other services expenses		(122,969	)		(160,617	)
Total	$	12,393		$	7,781

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Service Operations primarily consist of the leasing, property management, asset management, development, construction management and general contractor services for joint venture properties and properties owned by third parties. Service Operations are heavily influenced by the current state of the economy, as leasing and property management fees are dependent upon occupancy, while construction and development services rely on the expansion of business operations of third-party property owners and joint venture partners. Although total construction volume decreased from the second quarter of 2010, increased profitability on the third-party construction activity during the second quarter of 2011 drove the increase to our earnings from Service Operations.

Depreciation and Amortization

Depreciation and amortization expense increased from $79.0 million during the second quarter of 2010 to $100.1 million for the same period in 2011, primarily due to shorter-lived lease-based intangible assets being recognized in conjunction with our acquisition activity in 2010 and 2011.

Equity in Earnings of Unconsolidated Companies

Equity in earnings represents our ownership share of net income or loss from investments in unconsolidated joint ventures that generally own and operate rental properties and develop properties for sale. These earnings decreased from $2.0 million in the three months ended June 30, 2010 to $1.7 million for the same period in 2011. The slight decrease in equity in earnings was largely due to the consolidation of 106 properties upon the acquisition of our partner’s 50% interest in Dugan on July 1, 2010, partially offset by increases in our share of earnings from various other unconsolidated joint ventures.

Gain on Sale of Properties

During the second quarter of 2011, we sold three properties that did not meet the criteria for inclusion in discontinued operations, recognizing total gains on sale of $493,000.

During the second quarter of 2010, we sold four properties that did not meet the criteria for inclusion within discontinued operations, recognizing total gains on sale of $5.0 million.

Impairment Charges

In the second quarter of 2010, we sold 50 acres of land, which resulted in an impairment charge of $8.0 million. We had not previously identified or actively marketed this land for disposition.

General and Administrative Expense

General and administrative expenses decreased from $9.2 million for the second quarter of 2010 to $8.5 million for the same period in 2011. General and administrative expenses consist of two components. The first component includes general corporate expenses and the second component includes the indirect operating costs not allocated to the development or operations of our owned properties and Service Operations. Those indirect costs not allocated to or absorbed by these operations are charged to general and administrative expenses. The reduction in general and administrative expenses was primarily the result of an increase to indirect costs absorbed by operations, which was due to an increase in leasing activity during the second quarter of 2011 from the second quarter of 2010.

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Interest Expense

Interest expense increased from $58.0 million in the second quarter of 2010 to $66.8 million in the second quarter of 2011. The increase to interest expense was primarily driven by additional secured debt assumed over the last year in conjunction with our acquisition activities. A $2.0 million decrease in the capitalization of interest costs, the result of reduced development activity, also contributed to the increase in interest expense.

Loss on Debt Transactions

During the second quarter of 2010, through a cash tender offer and other open market transactions, we repurchased certain of our outstanding series of unsecured notes scheduled to mature in 2011 and 2013. In total, we paid $273.1 million for unsecured notes that had a face value of $260.7 million, recognizing a net loss on extinguishment of $15.8 million after considering the write-off of unamortized deferred financing costs and discounts.

Discontinued Operations

Subject to certain criteria, the results of operations for properties sold during the year to unrelated parties or classified as held-for-sale at the end of the period are required to be classified as discontinued operations. The property specific components of earnings that are classified as discontinued operations include rental revenues, rental expenses, real estate taxes, allocated interest expense and depreciation expense, as well as the net gain or loss on the disposition of properties.

The operations of 31 buildings are classified as discontinued operations for both the three months ended June 30, 2011 and June 30, 2010. These 31 buildings consist of 21 office, eight industrial, and two retail properties. As a result, we classified income, before gain on sales, of $157,000 and $1.2 million in discontinued operations for the three months ended June 30, 2011 and 2010, respectively.

Of these properties, three were sold during the second quarter of 2011 and two were sold during the second quarter of 2010. The gains on disposal of $2.7 million and $3.1 million for the three months ended June 30, 2011 and 2010, respectively, are reported in discontinued operations.

Comparison of Six Months Ended June 30, 2011 to Six Months Ended June 30, 2010

Rental and Related Revenue

The following table sets forth rental and related revenue from continuing operations by reportable segment for the six months ended June 30, 2011 and 2010, respectively (in thousands):

	Six Months Ended June 30,
	2011		2010
Rental and Related Revenue:
Office	$	231,787	$	249,703
Industrial		191,345		128,583
Non-reportable segments		44,612		38,798
Total	$	467,744	$	417,084

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The following factors contributed to these results:

• We acquired 71 properties, of which 62 were industrial, and placed five developments in service from January 1, 2010 to June 30, 2011, which provided incremental revenues of $36.3 million in the six months ended June 30, 2011, as compared to the same period in 2010.

• We consolidated 106 industrial buildings as a result of acquiring our joint venture partner’s 50% interest in Dugan on July 1, 2010. The consolidation of these buildings resulted in an increase of $39.3 million in rental and related revenue for the six months ended June 30, 2011, as compared to the same period in 2010.

• We sold 23 office properties to an unconsolidated joint venture in 2010 and the first quarter of 2011, resulting in a $23.4 million decrease in rental and related revenue from continuing operations in the six months ended June 30, 2011.

• The overall shift of revenues and income from office properties to industrial properties is consistent with our continuing strategy to increase our asset concentration in industrial properties while reducing our exposure to office properties.

Rental Expenses and Real Estate Taxes

The following table sets forth rental expenses and real estate taxes by reportable segment for the six months ended June 30, 2011 and 2010, respectively (in thousands):

	Six Months Ended June 30,
	2011		2010
Rental Expenses:
Office	$	67,829	$	72,810
Industrial		23,467		14,350
Non-reportable segments		12,643		9,415
Total	$	103,939	$	96,575
Real Estate Taxes:
Office	$	33,582	$	34,026
Industrial		30,960		18,383
Non-reportable segments		4,049		3,506
Total	$	68,591	$	55,915

Overall, rental expenses increased by $7.4 million in the six months ended June 30, 2011, compared to the same period in 2010. We recognized incremental costs of $7.7 million associated with the additional 71 properties acquired (of which 62 were industrial) and five developments placed in service. The July 1, 2010 consolidation of 106 industrial buildings in Dugan also resulted in a $5.6 million increase in rental expense for industrial properties in the first six months of 2011, which was partially offset by a decrease of $5.2 million related to 23 properties that were sold to an unconsolidated joint venture during 2010 and the first quarter of 2011.

Overall, real estate taxes increased by $12.7 million in the six months ended June 30, 2011, compared to the same period in 2010. The consolidation of the 106 industrial buildings in Dugan resulted in incremental real estate taxes of $7.2 million. There were also incremental costs of $6.7 million associated with the additional 71 properties acquired and five developments placed in service since January 1, 2010. The aforementioned increases were partially offset by a decrease of $3.4 million related to 23 properties that were sold to an unconsolidated joint venture during 2010 and the first quarter of 2011. The remaining increases were the result of increased taxes on our existing properties.

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Service Operations

The following table sets forth the components of the Service Operations reportable segment for the six months ended June 30, 2011 and 2010, respectively (in thousands):

	Six Months Ended June 30,
	2011			2010
Service Operations:
General contractor and service fee revenue	$	281,909		$	282,039
General contractor and other services expenses		(258,633	)		(267,779	)
Total	$	23,276		$	14,260

The improvement to income from Service Operations was due to improved profit margins on third-party construction activities performed during the first six months of 2011.

Depreciation and Amortization

Depreciation and amortization expense increased from $159.5 million during the first six months of 2010 to $194.7 million for the same period in 2011, primarily due to shorter-lived lease-based intangible assets being recognized in conjunction with our acquisition activity in 2010 and 2011.

Equity in Earnings of Unconsolidated Companies

Equity in earnings decreased from $6.9 million in the six months ended June 30, 2010 to $2.8 million for the same period in 2011. This decrease was largely due to the consolidation of 106 properties upon the acquisition of our partner’s 50% interest in Dugan on July 1, 2010.

Gain on Sale of Properties

During the six months ended June 30, 2011, we sold 18 properties that did not meet the criteria for inclusion in discontinued operations, recognizing total gains on sale of $68.3 million.

During the six-month period ended June 30, 2010, we sold eight properties that did not meet the criteria for inclusion in discontinued operations, recognizing total gains on sale of $7.0 million.

Impairment Charges

The decrease in impairment charges from $8.0 million in the six months ended June 30, 2010 to no impairment charges in the six months ended June 30, 2011 is primarily due to the sale of 50 acres of land in the second quarter of 2010.

General and Administrative Expense

General and administrative expenses decreased from $22.7 million for the six months ended June 30, 2010 to $19.7 million for the same period in 2011. The reduction in general and administrative expenses was primarily the result of an increase to indirect costs absorbed by operations, due in large part to increased leasing activity.

Interest Expense

Interest expense increased from $114.3 million in the first six months of 2010 to $133.0 million in the first six months of 2011. The increase to interest expense was primarily driven by additional secured debt

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assumed over the last year in conjunction with our acquisition activity. A $4.3 million decrease in the capitalization of interest costs, the result of reduced development activity, also contributed to the increase in interest expense.

Discontinued Operations

The operations of 31 buildings are classified as discontinued operations for the six months ended June 30, 2011 and June 30, 2010. These 31 buildings consist of 21 office, eight industrial, and two retail properties. As a result, we classified income, before gain on sales, of $107,000 and $1.7 million in discontinued operations for the six months ended June 30, 2011 and 2010, respectively.

Of these properties, twelve were sold during the first six months of 2011 and eleven were sold during the first six months of 2010. The $14.3 million and $12.9 million gains on disposal of these properties for the six months ended June 30, 2011 and 2010, respectively, are also reported in discontinued operations.

Liquidity and Capital Resources

Sources of Liquidity

We expect to meet our short-term liquidity requirements over the next twelve months, including payments of distributions as well as capital expenditures needed to maintain our current real estate assets, primarily through working capital, net cash provided by operating activities and proceeds received from real estate dispositions. Additionally, we have no outstanding borrowings on the Partnership’s $850.0 million unsecured line of credit at June 30, 2011, which allows us significant additional flexibility for temporary financing of either short-term obligations or strategic acquisitions.

In addition to our existing sources of liquidity, we expect to meet long-term liquidity requirements, such as scheduled mortgage and unsecured debt maturities, property acquisitions, financing of development activities and other capital improvements, through multiple sources of capital including operating cash flow, proceeds from property dispositions and accessing the public debt and equity markets.

Rental Operations

Cash flows from Rental Operations is our primary source of liquidity and provides a stable source of cash flow to fund operational expenses. We believe that this cash-based revenue stream is substantially aligned with revenue recognition (except for periodic straight-line rental income accruals and amortization of above or below market rents) as cash receipts from the leasing of rental properties are generally received in advance of, or a short time following, the actual revenue recognition.

We are subject to a number of risks as a result of general economic conditions, including reduced occupancy, tenant defaults and bankruptcies and potential reduction in rental rates upon renewal or re-letting of properties, any of which would result in reduced cash flow from operations.

Unsecured Debt and Equity Securities

We have historically used the Partnership’s unsecured line of credit to fund development activities, acquire additional rental properties and provide working capital.

At June 30, 2011, we and the General Partner had on file with the SEC an automatic shelf registration statement on Form S-3, relating to the offer and sale, from time to time, of an indeterminate amount of debt and equity securities, as well as guarantees of our debt securities by the General Partner. Equity securities are offered and

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sold by the General Partner and the net proceeds of such offerings are contributed to us in exchange for additional General Partner Units or Preferred Units. From time to time, we and the General Partner expect to issue additional securities under this automatic shelf registration statement to fund the repayment of long-term debt upon maturity and for other general corporate purposes.

Pursuant to its automatic shelf registration statement, at June 30, 2011, the General Partner has on file with the SEC a prospectus supplement that allows it to issue new shares of its common stock, from time to time, pursuant to an at the market offering program, with an aggregate offering price of up to $150.0 million. No new shares have been issued pursuant to this prospectus supplement as of June 30, 2011.

The indentures (and related supplemental indentures) governing our outstanding series of notes require us to comply with financial ratios and other covenants regarding our operations. We were in compliance with all such covenants, as well as applicable covenants under our unsecured line of credit, as of June 30, 2011.

Sale of Real Estate Assets

We regularly work to identify, consider and pursue opportunities to dispose of non-strategic properties on an opportunistic basis and on a basis that is generally consistent with our strategic plans. Our ability to dispose of such properties on favorable terms, or at all, is dependent upon a number of factors including the availability of credit to potential buyers to purchase properties at prices that we consider acceptable. Future adverse changes to market and economic conditions, including, without limitation, the availability and cost of credit, the U.S. mortgage market, and condition of the equity and real estate markets could prevent us from disposing of such properties quickly, if at all.

Transactions with Unconsolidated Entities

Transactions with unconsolidated partnerships and joint ventures also provide a source of liquidity. From time to time we will sell properties to unconsolidated entities, while retaining a continuing interest in that entity, and receive proceeds commensurate to those interests that we do not own. Additionally, unconsolidated entities will from time to time obtain debt financing and will distribute to us, and our joint venture partners, all or a portion of the proceeds from such debt financing.

We have a 20% equity interest in an unconsolidated joint venture (“Duke/Hulfish”) which, along with its subsidiary entities, has acquired 35 properties from us since its formation in May 2008. We have received cumulative net sale and financing proceeds of approximately $847.2 million through June 30, 2011. We are party to an agreement that allows Duke/Hulfish a right of first offer to acquire future build-to-suit or speculative developments on certain of our parcels of undeveloped land.

During the six months ended June 30, 2011, we sold 13 suburban office buildings, totaling approximately 2.0 million square feet, to Duke/Hulfish, for $342.8 million, of which our 80% share of net proceeds totaled $273.7 million. Concurrent with the aforementioned sale of 13 properties, we also received a distribution of $54.7 million, which is commensurate to our 20% share of the net proceeds of a non-guaranteed short-term loan that was obtained by Duke/Hulfish.

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Uses of Liquidity

Our principal uses of liquidity include the following:

• accretive property investment;

• leasing/capital costs;

• distributions to unitholders;

• long-term debt maturities;

• opportunistic repurchases of outstanding debt and Preferred Units; and

• other contractual obligations.

Property Investment

We continue to pursue an asset repositioning strategy that involves increasing our investment concentration in industrial and medical office properties while reducing our investment concentration in suburban office properties. Pursuant to this strategy, we evaluate development and acquisition opportunities based upon market outlook, supply and long-term growth potential. Our ability to make future property investments, along with being dependent upon identifying suitable acquisition and development opportunities, is also dependent upon our continued access to our longer-term sources of liquidity, including issuances of debt or equity securities as well as generating cash flow by disposing of selected properties.

In light of current economic conditions, management continues to evaluate our investment priorities and remains focused on accretive growth.

Second Generation Expenditures

Tenant improvements and leasing costs to re-let rental space that has been previously under lease to tenants are referred to as second generation expenditures. Building improvements that are not specific to any tenant but serve to improve integral components of our real estate properties are also second generation expenditures.

One of the principal uses of our liquidity is to fund the second generation leasing/capital expenditures of our real estate investments. The following is a summary of our second generation capital expenditures for the six months ended June 30, 2011 and 2010, respectively (in thousands):

	Six Months Ended June 30,
	2011		2010
Second generation tenant improvements	$	21,491	$	16,450
Second generation leasing costs		18,557		16,389
Building improvements		1,236		1,966
Totals	$	41,284	$	34,805

Distribution Requirements

The General Partner is required to meet the distribution requirements of the Internal Revenue Code of 1986, as amended (the “Code”), in order to maintain its REIT status. Because depreciation is a non-cash expense, cash flow will typically be greater than operating income. We paid distributions of $0.17 per Common Unit in the first and second quarters of 2011 and the General Partner’s board of directors declared distributions of $0.17 per Common Unit for the third quarter of 2011. Our future distributions will be declared at the discretion of the General Partner’s board of directors and will be subject to our future capital needs and availability.

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At June 30, 2011, the General Partner had six series of preferred stock outstanding. The annual distribution rates on the General Partner’s preferred shares range between 6.5% and 8.375% and are paid in arrears quarterly. In July 2011, the General Partner redeemed all of its 7.25% Series N Cumulative Redeemable Preferred Shares (“Series N Shares”) for a total payment of $109.0 million, thus reducing its future quarterly distribution commitments by $2.0 million.

Debt Maturities

Debt outstanding at June 30, 2011 had a face value totaling $4.1 billion with a weighted average interest rate of 6.36% and matures at various dates through 2028. Of this total amount, we had $2.9 billion of unsecured notes, $18.3 billion outstanding on a consolidated subsidiary’s unsecured line of credit and $1.2 billion of secured debt outstanding at June 30, 2011. Scheduled principal amortization, repurchases and maturities of such debt totaled $226.3 million for the six months ended June 30, 2011.

The following is a summary of the scheduled future amortization and maturities of our indebtedness at June 30, 2011 (in thousands, except percentage data):

	Future Repayments						Weighted Average
Year	Scheduled Amortization		Maturities		Total		Interest Rate of Future Repayments
Remainder of 2011	$	9,438	$	302,313	$	311,751		4.96	%
2012		17,009		351,053		368,062		5.65	%
2013		16,575		521,644		538,219		6.28	%
2014		15,270		305,012		320,282		6.34	%
2015		12,911		349,102		362,013		6.84	%
2016		10,976		492,560		503,536		6.16	%
2017		9,293		536,921		546,214		5.95	%
2018		7,356		300,000		307,356		6.08	%
2019		6,322		518,438		524,760		7.97	%
2020		4,732		250,000		254,732		6.73	%
2021		3,416		—		3,416		5.54	%
Thereafter		17,789		50,000		67,789		6.86	%
	$	131,087	$	3,977,043	$	4,108,130		6.36	%

We anticipate generating capital to fund our debt maturities by using undistributed cash generated from our Rental Operations and property dispositions, and by raising additional capital from future debt or equity transactions.

Repurchases of Outstanding Debt and Preferred Units

In the first six months of 2011, we repaid $42.5 million of senior unsecured notes, which had an effective interest rate of 6.96%, at their scheduled maturity date.

During the first six months of 2011, the General Partner repurchased 80,000 shares of its 8.375% Series O Cumulative Redeemable Preferred Shares (the “Series O Shares”). In total, the General Partner paid $2.1 million for these preferred shares that had a face value of $2.0 million. We then repurchased corresponding Preferred Units held by the General Partner at the same price at which it repurchased its shares on the open market. The General Partner paid $109.0 million in July 2011 to redeem its Series N Shares, which included dividends accrued through the redemption date.

To the extent that it supports our overall capital strategy, we may purchase certain of our outstanding unsecured debt prior to its stated maturity or redeem or repurchase certain of our Preferred Units held by the General Partner in conjunction with any redemption or repurchase it makes of the corresponding outstanding series of its preferred stock.

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Historical Cash Flows

Cash and cash equivalents were $117.6 million and $256.3 million at June 30, 2011 and 2010, respectively. The following highlights significant changes in net cash associated with our operating, investing and financing activities (in millions):

	Six Months Ended
	June 30,
	2011			2010
Net Cash Provided by Operating Activities	$	144.3		$	148.3
Net Cash Provided by (Used for) Investing Activities	$	305.7		$	(21.8	)
Net Cash Used for Financing Activities	$	(350.7	)	$	(17.8	)

Operating Activities

The receipt of rental income from Rental Operations continues to be our primary source of operating cash flows. For the six months ended June 30, 2011, cash provided by operating activities decreased to $144.3 million from $148.3 million in the same period in 2010. The decrease in cash provided by operating activities is primarily attributable to the timing of cash payments and receipts on third-party construction contracts.

Investing Activities

Investing activities are one of the primary uses of our liquidity. Development and acquisition activities typically generate additional rental revenues and provide cash flows for operational requirements. Highlights of significant cash sources and uses are as follows:

• Real estate development costs increased to $78.6 million for the six-month period ended June 30, 2011 from $56.8 million for the same period in 2010, primarily as a result of one build-to-suit property that was completed and sold in June 2011.

• Sales of land and depreciated property provided $498.2 million in net proceeds for the six-month period ended June 30, 2011, compared to $151.8 million for the same period in 2010.

• During the six-month period ended June 30, 2011, we received a $54.7 million cash distribution, which represented our share of the net proceeds from a loan obtained by one of our unconsolidated joint ventures.

• During the six-month period ended June 30, 2011, we paid cash of $99.8 million for real estate acquisitions, compared to $19.2 million for real estate acquisitions and $4.7 million for undeveloped land acquisitions in the same period in 2010.

Financing Activities

The following items highlight some of the factors that account for the difference in net cash flow related to financing activities in the first six months of 2011 compared to the same period in 2010:

• In March 2011, we repaid $42.5 million of unsecured notes with an effective rate of 6.96% at their scheduled maturity date, while, in January 2010, we repaid $99.8 million of senior unsecured notes with an effective interest rate of 5.37% on their scheduled maturity date.

• In April 2010, we issued $250.0 million of senior unsecured notes that bear interest at 6.75% and mature in March 2020, compared to no issuances of senior unsecured notes for the six-month period ended June 30, 2011.

• In March 2011, we repaid $175.0 million on the Partnership’s $850.0 million unsecured line of credit, while there was no net change in these borrowings for the six months ended June 30, 2010. We had no outstanding borrowings on the Partnership’s line of credit at June 30, 2011.

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• During the first six months of 2010, through a cash tender offer and other open market transactions, we repurchased certain of our outstanding series of unsecured notes scheduled to mature in 2011 and 2013. In total, we paid $288.0 million for unsecured notes that had a face value of $275.7 million.

• During June 2010, the General Partner completed open market repurchases of approximately 2.2 million shares of the Series O Shares compared to repurchases of 80,000 of such shares during the six-month period ended June 30, 2011. During the six-month period ended June 30, 2010, the General Partner paid $58.3 million to repurchase these shares, which had a face value of $55.7 million, as compared to paying $2.1 million during the six-month period ended June 30, 2011 for shares which had a face value of $2.0 million.

• In June 2010, the General Partner issued 26.5 million shares of its common stock for net proceeds of $298.1 million, compared to no issuances of common stock for the six-month period ended June 30, 2011.

Contractual Obligations

Aside from changes in long-term debt, there have not been material changes in our outstanding commitments since December 31, 2010, as previously discussed in our 2010 Annual Report on Form 10-K.

Off Balance Sheet Arrangements - Investments in Unconsolidated Companies

We analyze our investments in unconsolidated joint ventures to determine if they meet the criteria for classification as a variable interest entity (a “VIE”) and would require consolidation. We (i) evaluate the sufficiency of the total equity at risk, (ii) review the voting rights and decision-making authority of the equity investment holders as a group, and whether there are any guaranteed returns, protection against losses, or capping of residual returns within the group and (iii) establish whether activities within the venture are on behalf of an investor with disproportionately few voting rights in making this VIE determination. We would consolidate a venture that is determined to be a VIE if we were the primary beneficiary. To the extent that our joint ventures do not qualify as VIEs, we further assess each joint venture partner’s substantive participating rights to determine if the venture should be consolidated.

We have equity interests in unconsolidated partnerships and limited liability companies that own and operate rental properties and hold land for development. These unconsolidated joint ventures are primarily engaged in the operations and development of industrial, office and medical office real estate properties. These investments provide us with increased market share and tenant and property diversification. The equity method of accounting is used for these investments in which we have the ability to exercise significant influence, but not control, over operating and financial policies. As a result, the assets and liabilities of these entities are not included on our balance sheet. Our investments in and advances to unconsolidated subsidiaries represented approximately 5% of our total assets as of both June 30, 2011 and December 31, 2010. Total assets of our unconsolidated subsidiaries were $2.6 billion and $2.2 billion as of June 30, 2011 and December 31, 2010, respectively. The combined revenues of our unconsolidated subsidiaries totaled $129.0 million and $136.2 million for the six-month periods ended June 30, 2011 and 2010, respectively.

We have guaranteed the repayment of certain secured and unsecured loans of our unconsolidated subsidiaries and the outstanding balances on the guaranteed portion of these loans totaled $249.9 million at June 30, 2011.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to interest rate changes primarily as a result of our line of credit and our long-term borrowings. Our interest rate risk management objective is to limit the impact of interest rate changes on earnings and cash flows and to lower overall borrowing costs. To achieve our objectives, we borrow primarily at fixed rates. We

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do not enter into derivative or interest rate transactions for speculative purposes. Our two outstanding swaps, which fixed the rates on two of our variable rate loans, were not significant to our Financial Statements in terms of notional amount or fair value at June 30, 2011.

Our interest rate risk is monitored using a variety of techniques. The table below presents the principal amounts (in thousands) of the expected annual maturities, weighted average interest rates for the average debt outstanding in the specified period, fair values (in thousands) and other terms required to evaluate the expected cash flows and sensitivity to interest rate changes.

	Remainder of 2011			2012			2013			2014			2015			Thereafter			Face Value		Fair Value
Fixed rate secured debt	$	19,912		$	109,981		$	110,374		$	67,254		$	109,487		$	742,768		$	1,159,776	$	1,229,467
Weighted average interest rate		7.04	%		6.05	%		5.86	%		6.45	%		5.36	%		6.57	%
Variable rate secured debt	$	785		$	16,906		$	880		$	935		$	300		$	3,100		$	22,906	$	22,906
Weighted average interest rate		0.27	%		4.77	%		0.28	%		0.28	%		0.15	%		0.15	%
Fixed rate unsecured debt	$	291,054		$	222,846		$	426,965		$	252,093		$	252,226		$	1,461,935		$	2,907,119	$	3,174,709
Weighted average interest rate		4.83	%		5.91	%		6.40	%		6.33	%		7.49	%		6.66	%
Unsecured lines of credit	$	—		$	18,329		$	—		$	—		$	—		$	—		$	18,329	$	18,117
Rate at June 30, 2011		N/A			1.04	%		N/A			N/A			N/A			N/A

As the above table incorporates only those exposures that exist as of June 30, 2011, it does not consider those exposures or positions that could arise after that date. As a result, our ultimate realized gain or loss with respect to interest rate fluctuations will depend on the exposures that arise during the period, our hedging strategies at that time to the extent we are party to interest rate derivatives and interest rates. Interest expense on our unsecured lines of credit will be affected by fluctuations in the LIBOR indices as well as changes in our credit rating. The interest rate at such point in the future as we may renew, extend or replace our unsecured lines of credit will be heavily dependent upon the state of the credit environment.

Item 4. Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. These disclosure controls and procedures are further designed to ensure that such information is accumulated and communicated to management, including the General Partner’s Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

We carried out an evaluation, under the supervision and with the participation of management, including the General Partner’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rules 13a-15 and 15d-15. Based upon the foregoing, the General Partner’s Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this Report, our disclosure controls and procedures are effective in all material respects.

(b) Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting during the period covered by this Report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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Part II - Other Information

Item 1. Legal Proceedings

From time to time, we are parties to a variety of legal proceedings and claims arising in the ordinary course of our businesses. While these matters generally are covered by insurance, there is no assurance that our insurance will cover any particular proceeding or claim. We presently believe that all of these proceedings to which we were subject as of June 30, 2011, taken as a whole, will not have a material adverse effect on our liquidity, business, financial condition or results of operations.

Item 1A. Risk Factors

In addition to the information set forth in this Report, you also should carefully review and consider the information contained in our other reports and periodic filings that we make with the SEC, including, without limitation the information contained under the caption “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2010. The risks and uncertainties described in our 2010 Annual Report on Form 10-K are not the only risks that we face. Additional risks and uncertainties not currently known to us, or that we presently deem to be immaterial, also may materially adversely affect our business, financial condition and results of operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(a) Unregistered Sales of Equity Securities

None

(b) Use of Proceeds

None

(c) Issuer Purchases of Equity Securities

From time to time, the General Partner may repurchase its securities under a repurchase program that initially was approved by the General Partner’s board of directors and publicly announced in October 2001 (the “Repurchase Program”).

The following table shows the General Partner’s share repurchase activity for the three months in the quarter ended June 30, 2011:

Month	Total Number of Shares Purchased			Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced  Plans or Programs		Value of Shares That May Yet be Re purchased Under the Plan (1)
April 1-30, 2011		5,052		$	14.10		5,052		74,454,243
May 1-31, 2011		9,720		$	14.98		9,720		74,308,638
June 1-30, 2011		3,907		$	13.49		3,907		74,255,932
Total		18,679	(2)	$	14.43		18,679

(1) On April 27, 2011, the General Partner’s board of directors adopted a resolution that amended and restated the Repurchase Program and delegated authority to management to repurchase a maximum of $75.0 million of common shares, $250.0 million of debt securities and $75.0 million of preferred shares (the “April 2011 Resolution”). The April 2011 Resolution will expire on April 27, 2012.

(2) Common shares repurchased in connection with the General Partner’s Employee Stock Ownership Plan, a component of its Repurchase Program.

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Item 3. Defaults upon Senior Securities

During the period covered by this Report, we did not default under the terms of any of our material indebtedness, nor has there been any material arrearage of distributions or other material uncured delinquency with respect to any class of our preferred equity.

Item 4. Reserved

Item 5. Other Information

During the period covered by this Report, there was no information required to be disclosed by us in a Current Report on Form 8-K that was not so reported, nor were there any material changes to the procedures by which our security holders may recommend nominees to the General Partner’s board of directors.

Item 6. Exhibits

(a) Exhibits

3.1	Certificate of Limited Partnership of the Partnership, dated September 17, 1993 (filed as Exhibit 3.1 (i) to the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2006, as filed with the SEC on March 13, 2007, and incorporated herein by this reference).
3.2(i)	Fourth Amended and Restated Agreement of Limited Partnership of the Partnership (filed as Exhibit 3.1 to the Partnership’s Current Report on Form 8-K as filed with the SEC on November 3, 2009, and incorporated herein by this reference).
3.2(ii)	Amendment to Fourth Amended and Restated Agreement of Limited Partnership of the Partnership (filed as Exhibit 3.1 to the Partnership’s Current Report on form 8-K as filed with the SEC on July 22, 2011, and incorporated herein by reference).
10.1	2011 Amendment to the General Partner’s Amended and Restated 2005 Long-Term Incentive Plan (filed as Exhibit 10.2 to the General Partner’s Quarterly Report on Form 10-Q as filed with the SEC on August 5, 2011 and incorporated herein by this reference).#
11.1	Statement Regarding Computation of Earnings.***
12.1	Statement of Computation of Ratio of Earnings to Fixed Charges and Ratio of Earnings to Combined Fixed Charges and Preferred Distributions.*
31.1	Rule 13a-14(a) Certification of the General Partner’s Chief Executive Officer.*
31.2	Rule 13a-14(a) Certification of the General Partner’s Chief Financial Officer.*
32.1	Section 1350 Certification of the General Partner’s Chief Executive Officer.**
32.2	Section 1350 Certification of the General Partner’s Chief Financial Officer.**
101	The following materials from Duke Realty Limited Partnership’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2011 formatted in XBRL (eXtensible Business

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Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Cash Flows, (iv) the Consolidated Statement of Changes in Equity, (v) the Notes to Consolidated Financial Statements, tagged as blocks of text.

# Represents management or compensatory plan or arrangement.

* Filed herewith.

** The certifications attached as Exhibits 32.1 and 32.2 accompany this Quarterly Report on Form 10-Q and are “furnished” to the Securities and Exchange Commission pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed “filed” by the Partnership for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

*** Data required by Financial Accounting Standards Board Auditing Standards Codification No. 260 is provided in Note 8 to the Consolidated Financial Statements included in this report.

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SIGNATURES

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

	DUKE REALTY LIMITED PARTNERSHIP
Date: August 9, 2011	/s/ Dennis D. Oklak
	Dennis D. Oklak
	Chairman and Chief Executive Officer of the General Partner
	/s/ Christie B. Kelly
	Christie B. Kelly
	Executive Vice President and Chief Financial Officer of the General Partner
	/s/ Mark A. Denien
	Mark A. Denien
	Senior Vice President and Chief Accounting Officer of the General Partner

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EX-12.1

EXHIBIT 12.1

DUKE REALTY LIMITED PARTNERSHIP

CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO

COMBINED FIXED CHARGES AND PREFERRED DISTRIBUTIONS

(in thousands, except ratios)

	Six Months Ended June 30, 2011		Year Ended December 31, 2010			Year Ended December 31, 2009			Year Ended December 31, 2008			Year Ended December 31, 2007		Year Ended December 31, 2006
Net income (loss) from continuing operations, less preferred distributions	$	4,560	$	(40,629	)	$	(328,413	)	$	14,080		$	102,075	$	100,540
Preferred distributions		31,948		69,468			73,451			71,426			58,292		56,419
Interest expense		132,950		239,007			205,789			182,860			159,038		155,998
Earnings (loss) before fixed charges	$	169,458	$	267,846		$	(49,173	)	$	268,366		$	319,405	$	312,957
Interest expense	$	132,950	$	239,007		$	205,789		$	182,860		$	159,038	$	155,998
Interest costs capitalized		2,906		11,498			26,864			53,456			59,167		36,260
Total fixed charges		135,856		250,505			232,653			236,316			218,205		192,258
Preferred distributions		31,948		69,468			73,451			71,426			58,292		56,419
Total fixed charges and preferred distributions	$	167,804	$	319,973		$	306,104		$	307,742		$	276,497	$	248,677
Ratio of earnings to fixed charges		1.25		1.07			N/A	(2)		1.14			1.46		1.63
Ratio of earnings to fixed charges and preferred distributions		1.01		N/A	(1)		N/A	(3)		N/A	(4)		1.16		1.26

(1) N/A - The ratio is less than 1.0; deficit of $52.1 million exists for the year ended December 31, 2010. The calculation of earnings includes $348.3 million of non-cash depreciation expense.

(2) N/A - The ratio is less than 1.0; deficit of $281.8 million exists for the year ended December 31, 2009. The calculation of earnings includes $322.7 million of non-cash depreciation expense.

(3) N/A - The ratio is less than 1.0; deficit of $355.3 million exists for the year ended December 31, 2009. The calculation of earnings includes $322.7 million of non-cash depreciation expense.

(4) N/A - The ratio is less than 1.0; deficit of $39.4 million exists for the year ended December 31, 2008. The calculation of earnings includes $291.9 million of non-cash depreciation expense.

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER

OF THE GENERAL PARTNER

I, Dennis D. Oklak, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Duke Realty Limited Partnership;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 9, 2011

/s/ Dennis D. Oklak

Dennis D. Oklak

Chairman and Chief Executive Officer
of the General Partner

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF THE CHIEF FINANCIAL OFFICER

OF THE GENERAL PARTNER

I, Christie B. Kelly, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Duke Realty Limited Partnership;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 9, 2011

/s/ Christie B. Kelly

Christie B. Kelly

Executive Vice President and Chief Financial Officer
of the General Partner

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Duke Realty Limited Partnership (the “Partnership”) on Form 10-Q for the quarter ending June 30, 2011 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Dennis D. Oklak, Chief Executive Officer of the General Partner, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

/s/ Dennis D. Oklak

Dennis D. Oklak

Chairman and Chief Executive Officer
of the General Partner

Date: August 9, 2011

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Duke Realty Limited Partnership and will be retained by Duke Realty Limited Partnership and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Duke Realty Limited Partnership (the “Partnership”) on Form 10-Q for the quarter ending June 30, 2011 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Christie B. Kelly, Executive Vice President and Chief Financial Officer of the General Partner, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

/s/ Christie B. Kelly

Christie B. Kelly

Executive Vice President and
Chief Financial Officer
of the General Partner

Date: August 9, 2011

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Duke Realty Limited Partnership, and will be retained by Duke Realty Limited Partnership and furnished to the Securities and Exchange Commission or its staff upon request.

XML



Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands	Jun. 30, 2011	Dec. 31, 2010
Consolidated Balance Sheets
Accounts receivable, allowance	$ 3,802	$ 2,945
Straight-line rent receivable, allowance	7,924	7,260
Deferred financing costs, accumulated amortization	52,844	46,407
Deferred leasing and other costs, accumulated amortization	$ 313,986	$ 269,000
Common equity, General Partner Units issued	252,663	252,195
Common equity, General Partner Units outstanding	252,663	252,195
Preferred equity, issued	3,610	3,618
Preferred equity, outstanding	3,610	3,618
Limited Partner Units, issued	7,190	5,231
Limited Partner Units, outstanding	7,190	5,231

XML



Consolidated Statements Of Operations (USD $) In Thousands, except Per Share data	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Revenues:
Rental and related revenue	$ 227,708	$ 205,588	$ 467,744	$ 417,084
General contractor and service fee revenue	135,362	168,398	281,909	282,039
Revenues, total	363,070	373,986	749,653	699,123
Expenses:
Rental expenses	47,153	45,446	103,939	96,575
Real estate taxes	33,647	27,489	68,591	55,915
General contractor and other services expenses	122,969	160,617	258,633	267,779
Depreciation and amortization	100,058	78,956	194,743	159,481
Cost and expenses, total	303,827	312,508	625,906	579,750
Other operating activities:
Equity in earnings of unconsolidated companies	1,713	2,016	2,786	6,945
Gain on sale of properties	493	4,973	68,348	7,042
Undeveloped land carrying costs	(2,453)	(2,542)	(4,762)	(4,793)
Impairment charges		(7,974)		(7,974)
Other operating expenses	(26)	(145)	(111)	(422)
General and administrative expense	(8,541)	(9,151)	(19,738)	(22,695)
Other operation transactions total	(8,814)	(12,823)	46,523	(21,897)
Operating income	50,429	48,655	170,270	97,476
Other income (expenses):
Interest and other income, net	284	204	371	355
Interest expense	(66,846)	(58,044)	(132,950)	(114,300)
Loss on debt transactions		(15,773)		(16,127)
Acquisition costs	(594)		(1,183)
Income (loss) from continuing operations	(16,727)	(24,958)	36,508	(32,596)
Discontinued operations:
Income before gain on sales	157	1,240	107	1,748
Gain on sale of depreciable properties	2,712	3,078	14,316	12,856
Income from discontinued operations	2,869	4,318	14,423	14,604
Net income (loss)	(13,858)	(20,640)	50,931	(17,992)
Distributions on Preferred Units	(15,974)	(18,363)	(31,948)	(36,726)
Adjustments for repurchase of Preferred Units		(4,492)	(163)	(4,492)
Net (income) loss attributable to noncontrolling interests	84	(108)	206	(106)
Net income (loss) attributable to common unitholders	$ (29,748)	$ (43,603)	$ 19,026	$ (59,316)
Basic net income (loss) per Common Unit:
Continuing operations attributable to common unitholders	$ (0.13)	$ (0.21)	$ 0.01	$ (0.32)
Discontinued operations attributable to common unitholders	$ 0.01	$ 0.02	$ 0.06	$ 0.06
Total	$ (0.12)	$ (0.19)	$ 0.07	$ (0.26)
Diluted net income (loss) per Common Unit:
Continuing operations attributable to common unitholders	$ (0.13)	$ (0.21)	$ 0.01	$ (0.32)
Discontinued operations attributable to common unitholders	$ 0.01	$ 0.02	$ 0.06	$ 0.06
Total	$ (0.12)	$ (0.19)	$ 0.07	$ (0.26)
Weighted average number of Common Units outstanding	259,849	233,486	259,322	232,130
Weighted average number of Common Units and potential dilutive securities	259,849	233,486	259,390	232,130

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Document And Entity Information	6 Months Ended
	Jun. 30, 2011	Aug. 05, 2011
Document And Entity Information
Document Type	10-Q
Document Period End Date	Jun. 30, 2011
Document Fiscal Period Focus	Q2
Amendment Flag	false
Document Fiscal Year Focus	2011
Entity Registrant Name	DUKE REALTY LIMITED PARTNERSHIP/
Entity Central Index Key	0001003410
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		259,867,356

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Indebtedness

6 Months Ended

Jun. 30, 2011

Indebtedness

Indebtedness

5. Indebtedness

The following table summarizes the book value and changes in the fair value of our debt for the six months ended June 30, 2011 (in thousands):

	Book Value at 12/31/10		Book Value at 6/30/11		Fair Value at 12/31/10		Issuances and Assumptions		Payoffs			Adjustments to Fair Value			Fair Value at 6/30/11
Fixed rate secured debt	$	1,042,722	$	1,164,138	$	1,069,562	$	129,831	$	(7,968	)	$	38,042		$	1,229,467
Variable rate secured debt		22,906		22,906		22,906		—		—			—			22,906
Fixed rate unsecured notes		2,948,405		2,906,154		3,164,651		—		(43,377	)		53,435			3,174,709
Unsecured lines of credit		193,046		18,329		193,224		283		(175,000	)		(390	)		18,117
Total	$	4,207,079	$	4,111,527	$	4,450,343	$	130,114	$	(226,345	)	$	91,087		$	4,445,199

Fixed Rate Secured Debt

Because our fixed rate secured debt is not actively traded in any marketplace, we utilized a discounted cash flow methodology to determine its fair value. Accordingly, we calculated fair value by applying an estimate of the current market rate to discount the debt's remaining contractual cash flows. Our estimate of a current market rate, which is the most significant input in the discounted cash flow calculation, is intended to replicate debt of similar maturity and loan-to-value relationship. The estimated rates ranged from 4.10% to 5.80%, depending on the attributes of the specific loans. The current market rates we utilized were internally estimated; therefore, we have concluded that our determination of fair value for our fixed rate secured debt was primarily based upon Level 3 inputs, as defined.

In the first six months of 2011, we assumed nine secured loans associated with the acquisition of the Premier Portfolio, which had a total acquisition date face value of $124.4 million and fair value of $125.0 million. The assumed loans carry a weighted average interest rate of 5.78% and a weighted remaining term upon acquisition of 5.0 years. We used estimated market rates ranging between 4.40% and 5.81% in determining the fair value of the loans.

Fixed Rate Unsecured Debt

In March 2011, we repaid $42.5 million of senior unsecured notes, which had an effective interest rate of 6.96%, at their scheduled maturity date.

We utilized broker estimates in estimating the fair value of our fixed rate unsecured debt. Our unsecured notes are thinly traded and, in certain cases, the broker estimates were not based upon comparable transactions. The broker estimates took into account any recent trades within the same series of our fixed rate unsecured debt, comparisons to recent trades of other series of our fixed rate unsecured debt, trades of fixed rate unsecured debt from companies with profiles similar to ours, as well as overall economic conditions. We reviewed these broker estimates for reasonableness and accuracy, considering whether the estimates were based upon market participant assumptions within the principal and most advantageous market and whether any other observable inputs would be more accurate indicators of fair value than the broker estimates. We concluded that the broker estimates were representative of fair value. We have determined that our estimation of the fair value of our fixed rate unsecured debt was primarily based upon Level 3 inputs, as defined. The estimated trading values of our fixed rate unsecured debt, depending on the maturity and coupon rates, ranged from 100.0% to 121.0% of face value.

The indentures (and related supplemental indentures) governing our outstanding series of notes also require us to comply with financial ratios and other covenants regarding our operations. We were in compliance with all such covenants as of June 30, 2011.

Unsecured Lines of Credit

Our unsecured lines of credit as of June 30, 2011 are described as follows (in thousands):

Description	Maximum Capacity		Maturity Date		Outstanding Balance at June 30, 2011
Unsecured Line of Credit - Partnership	$	850,000		February 2013	$	—
Unsecured Line of Credit - Consolidated Subsidiary	$	30,000		July 2012	$	18,329

The Partnership's unsecured line of credit has an interest rate on borrowings of LIBOR plus 2.75%, and a maturity date of February 2013. There were no borrowings on the Partnership's unsecured line of credit at June 30, 2011. Subject to certain conditions, the terms also include an option to increase the facility by up to an additional $200.0 million, for a total of up to $1.05 billion.

This line of credit provides us with an option to obtain borrowings from financial institutions that participate in the line at rates that may be lower than the stated interest rate, subject to certain restrictions.

This line of credit contains financial covenants that require us to meet certain financial ratios and defined levels of performance, including those related to fixed charge coverage and debt-to-asset value (with asset value being defined in the Partnership's unsecured line of credit agreement). As of June 30, 2011, we were in compliance with all covenants under this line of credit.

The consolidated subsidiary's unsecured line of credit allows for borrowings up to $30.0 million at a rate of LIBOR plus .85% (equal to 1.04% for outstanding borrowings as of June 30, 2011). This unsecured line of credit is used to fund development activities within the consolidated subsidiary and matures in July 2012.

To the extent that there are outstanding borrowings, we utilize a discounted cash flow methodology in order to estimate the fair value of our unsecured lines of credit. The net present value of the difference between future contractual interest payments and future interest payments based on our estimate of a current market rate represents the difference between the book value and the fair value. Our estimate of a current market rate is based upon the rate, considering current market conditions and our specific credit profile, at which we estimate we could obtain similar borrowings. The current market rate of 2.19% that we utilized was internally estimated; therefore, we have concluded that our determination of fair value for our unsecured lines of credit was primarily based upon Level 3 inputs, as defined.

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Discontinued Operations

6 Months Ended

Jun. 30, 2011

Discontinued Operations

Discontinued Operations

10. Discontinued Operations

The following table illustrates the number of properties in discontinued operations:

	Sold in 2011		Sold in 2010		Total
Office		10		11		21
Industrial		2		6		8
Retail		—		2		2
		12		19		31

We allocate interest expense to discontinued operations and have included such interest expense in computing income from discontinued operations. Interest expense allocable to discontinued operations includes interest on any secured debt for properties included in discontinued operations and an allocable share of our consolidated unsecured interest expense for unencumbered properties. The allocation of unsecured interest expense to discontinued operations was based upon the gross book value of the unencumbered real estate assets included in discontinued operations as it related to the total gross book value of our unencumbered real estate assets.

The following table illustrates the operations of the buildings reflected in discontinued operations for the three and six months ended June 30, 2011 and 2010, respectively (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Revenues	$	365		$	11,234		$	3,485		$	23,997
Operating expenses		(74	)		(4,118	)		(1,787	)		(9,301	)
Depreciation and amortization		(55	)		(3,049	)		(351	)		(6,692	)
Operating income		236			4,067			1,347			8,004
Interest expense		(79	)		(2,827	)		(1,240	)		(6,256	)
Income before gain on sales		157			1,240			107			1,748
Gain on sale of depreciable properties		2,712			3,078			14,316			12,856
Income from discontinued operations	$	2,869		$	4,318		$	14,423		$	14,604

The income from discontinued operations for all periods presented is entirely attributable to the common unitholders.

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General Basis Of Presentation

6 Months Ended

Jun. 30, 2011

General Basis Of Presentation

General Basis Of Presentation

1. General Basis of Presentation

The interim consolidated financial statements included herein have been prepared by Duke Realty Limited Partnership (the "Partnership"). The 2010 year-end consolidated balance sheet data included in this Quarterly Report on Form 10-Q (this "Report") was derived from the audited financial statements in our Annual Report on Form 10-K for the year ended December 31, 2010, but does not include all disclosures required by accounting principles generally accepted in the United States of America ("GAAP"). The financial statements have been prepared in accordance with GAAP for interim financial information and in accordance with Rule 10-01 of Regulation S-X of the Securities Exchange Act of 1934, as amended. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and revenue and expenses during the reporting period. Our actual results could differ from those estimates and assumptions. These financial statements should be read in conjunction with Management's Discussion and Analysis of Financial Condition and Results of Operations included herein and the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2010.

The Partnership was formed on October 4, 1993, when Duke Realty Corporation (the "General Partner") contributed all of its properties and related assets and liabilities, together with the net proceeds from an offering of additional shares of its common stock, to the Partnership. Simultaneously, the Partnership completed the acquisition of Duke Associates, a full-service commercial real estate firm operating in the Midwest. The General Partner was formed in 1985 and we believe that it qualifies as a real estate investment trust ("REIT") under the provisions of the Internal Revenue Code of 1986, as amended (the "Code"). The General Partner is the sole general partner of the Partnership owning 97.2% of the common Partnership interests as of June 30, 2011 ("General Partner Units"). The remaining 2.8% of the Partnership's common interest is owned by limited partners ("Limited Partner Units" and, together with the General Partner Units, the "Common Units"). Limited Partners have the right to redeem their Limited Partner Units, subject to certain restrictions. Pursuant to the Partnership's Partnership Agreement (the "Partnership Agreement"), the General Partner is obligated to redeem the Limited Partner Units in shares of its common stock, unless it determines in its reasonable discretion that the issuance of shares of its common stock could cause it to fail to qualify as a REIT. Each Limited Partner Unit shall be redeemed for one share of the General Partner's common stock, or, in the event that the issuance of shares could cause the General Partner to fail to qualify as a REIT, cash equal to the fair market value of one share of the General Partner's common stock at the time of redemption, in each case, subject to certain adjustments described in the Partnership Agreement. The Limited Partner Units are not required, per the terms of the Partnership Agreement, to be redeemed in registered shares of the General Partner. The General Partner also owns preferred partnership interests in the Partnership ("Preferred Units").

We own and operate a real estate portfolio primarily consisting of industrial and office properties and provide real estate services to third-party owners. We conduct our Service Operations (see Note 9) through Duke Realty Services LLC, Duke Realty Services Limited Partnership and Duke Construction Limited Partnership ("DCLP"). DCLP is owned through a taxable REIT subsidiary. The consolidated financial statements include our accounts and the accounts of our majority-owned or controlled subsidiaries. In this Report, unless the context indicates otherwise, the terms "we," "us" and "our" refer to the Partnership and those entities owned or controlled by the Partnership.

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Related Party Transactions

6 Months Ended

Jun. 30, 2011

Related Party Transactions

Related Party Transactions

7. Related Party Transactions

We provide property management, asset management, leasing, construction and other tenant related services to unconsolidated companies in which we have equity interests. We recorded the corresponding fees based on contractual terms that approximate market rates for these types of services and we have eliminated our ownership percentage of these fees in the consolidated financial statements. The following table summarizes the fees earned from these companies for the six months ended June 30, 2011 and 2010, respectively (in thousands):

	Six Months Ended June 30,
	2011		2010
Management fees	$	4,623	$	4,142
Leasing fees		2,801		1,105
Construction and development fees		2,396		4,036

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Net Income (Loss) Per Common Unit

6 Months Ended

Jun. 30, 2011

Net Income (Loss) Per Common Unit

Net Income (Loss) Per Common Unit

8. Net Income (Loss) Per Common Unit

Basic net income (loss) per Common Unit is computed by dividing net income (loss) attributable to common unitholders, less distributions on share-based awards expected to vest (referred to as "participating securities" and primarily composed of unvested restricted stock units), by the weighted average number of Common Units outstanding for the period. Diluted net income (loss) per Common Unit is computed by dividing basic net income (loss) attributable to common unitholders by the sum of the weighted average number of Common Units outstanding and any potential dilutive securities for the period.

The following table reconciles the components of basic and diluted net income (loss) per Common Unit for the three and six months ended June 30, 2011 and 2010, respectively (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Net income (loss) attributable to common unitholders	$	(29,748	)	$	(43,603	)	$	19,026		$	(59,316	)
Less: Distributions on participating securities		(806	)		(505	)		(1,605	)		(1,005	)
Basic and diluted net income (loss) attributable to common unitholders	$	(30,554	)	$	(44,108	)	$	17,421		$	(60,321	)
Weighted average number of Common Units outstanding		259,849			233,486			259,322			232,130
Other potential dilutive units		—			—			68			—
Weighted average number of Common Units and potential dilutive securities		259,849			233,486			259,390			232,130

Potential units related to the majority of our stock-based compensation plans as well as our 3.75% Exchangeable Senior Notes ("Exchangeable Notes") are anti-dilutive for all periods presented. The following table summarizes the data that is excluded from the computation of net income (loss) per Common Unit as a result of being anti-dilutive (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2011		2010		2011		2010
Anti-dilutive outstanding potential units under fixed stock option plans		1,677		1,787		1,677		1,787
Anti-dilutive potential units under the Exchangeable Notes		3,432		4,335		3,432		4,335
Outstanding participating securities		4,816		4,188		4,816		4,188

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Partners' Equity

6 Months Ended

Jun. 30, 2011

Partners' Equity

Partners' Equity

6. Partners' Equity

In the first six months of 2011, the General Partner repurchased 80,000 shares of its 8.375% Series O Cumulative Redeemable Preferred Shares ("Series O Shares"). The Series O Shares that the General Partner repurchased had a total redemption value of $2.0 million and were repurchased for $2.1 million. We then repurchased corresponding Preferred Units held by the General Partner at the same price at which it repurchased its preferred shares on the open market. An adjustment of approximately $163,000, which included a ratable portion of issuance costs, was included in net income attributable to common unitholders.

In conjunction with the acquisition of the Premier Portfolio (Note 4), we issued 2.1 million Limited Partner Units with a fair value at issuance of $28.4 million, which are included in Limited Partners' common equity.

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Consolidated Statement Of Changes In Equity (USD $) In Thousands	Common Equity	Preferred Equity	Limited Partners' Common Equity	Accumulated Other Comprehensive Income (Loss)	Total Partners' Equity	Noncontrolling Interests	Total
Balance at Dec. 31, 2010	$ 2,046,617	$ 904,540	$ 34,894	$ (1,432)	$ 2,984,619	$ 5,226	$ 2,989,845
Comprehensive income:
Net income	18,690	31,948	499		51,137	(206)	50,931
Derivative instrument activity				1,488	1,488		1,488
Comprehensive income					52,625	(206)	52,419
Issuance of Limited Partner Units for acquisition			28,357		28,357		28,357
Conversion of Limited Partner Units to common shares of the General Partner	1,235		(1,235)				1,235
Repurchase of Preferred Units	(96)	(2,000)			(2,096)		(2,096)
Stock based compensation plan activity	6,378				6,378		6,378
Distribution to Preferred Unitholders		(31,948)			(31,948)		(31,948)
Distributions to Partners ($.34 per Common Unit)	(85,879)		(2,340)		(88,219)		(88,219)
Distributions to noncontrolling interests						(58)	(58)
Balance at Jun. 30, 2011	$ 1,986,945	$ 902,540	$ 60,175	$ 56	$ 2,949,716	$ 4,962	$ 2,954,678
Common Units outstanding at June 30, 2011 at Jun. 30, 2011	252,663		7,190		259,853

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Reclassifications

6 Months Ended

Jun. 30, 2011

Reclassifications

Reclassifications

2. Reclassifications

Certain amounts in the accompanying consolidated financial statements for 2010 have been reclassified to conform to the 2011 consolidated financial statement presentation.

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Variable Interest Entities

6 Months Ended

Jun. 30, 2011

Variable Interest Entities

Variable Interest Entities

3. Variable Interest Entities

At June 30, 2011, there are four unconsolidated joint ventures that we have determined meet the criteria to be considered variable interest entities ("VIEs"). These four unconsolidated joint ventures were formed with the sole purpose of developing, constructing, leasing, marketing and selling or operating properties. The business activities of these unconsolidated joint ventures have been financed through a combination of equity contributions, partner/member loans, and third-party debt that is guaranteed by both us and the other partner/member of each entity. All significant decisions for these unconsolidated joint ventures, including those decisions that most significantly impact each venture's economic performance, require unanimous approval of each joint venture's partners or members. In certain cases, these decisions also require lender approval. Unanimous approval requirements for these unconsolidated joint ventures include entering into new leases, setting annual operating budgets, selling underlying properties, and incurring additional indebtedness. Because no single entity exercises control over the decisions that most significantly affect each joint venture's economic performance, we determined that the equity method of accounting is appropriate.

The following is a summary of the carrying value in our consolidated balance sheet, as well as our maximum loss exposure under guarantees for the four unconsolidated subsidiaries that we have determined to be VIEs as of June 30, 2011:

	Carrying Value		Maximum Loss Exposure
Investment in Unconsolidated Company	$	38.3 million	$	38.3 million
Guarantee Obligations (1)	$	(22.9 million)	$	(62.4 million)

(1) We are party to guarantees of the third-party debt of these joint ventures and our maximum loss exposure is equal to the maximum monetary obligation pursuant to the guarantee agreements. In 2009, we recorded a liability for our probable future obligation under a guarantee to the lender of one of these ventures. Pursuant to an agreement with the lender, we may make partner loans to this joint venture that will reduce our maximum guarantee obligation on a dollar-for-dollar basis. The carrying value of our recorded guarantee obligations is included in other liabilities in our Consolidated Balance Sheets.

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Subsequent Events

6 Months Ended

Jun. 30, 2011

Subsequent Events

Subsequent Events

11. Subsequent Events

Declaration of Distributions

The General Partner's board of directors declared the following distributions at its regularly scheduled board meeting held on July 27, 2011:

Class	Quarterly Amount/Unit		Record Date		Payment Date
Common	$	0.17		August 17, 2011		August 31, 2011
Preferred (per depositary unit):
Series J	$	0.414063		August 17, 2011		August 31, 2011
Series K	$	0.406250		August 17, 2011		August 31, 2011
Series L	$	0.412500		August 17, 2011		August 31, 2011
Series M	$	0.434375		September 16, 2011		September 30, 2011
Series O	$	0.523438		September 16, 2011		September 30, 2011

On June 17, 2011, the General Partner called for redemption all of its 434,520 outstanding 7.25% Series N Cumulative Redeemable Preferred Shares. The redemption took place on July 18, 2011 for $109.0 million, which included distributions accrued through the redemption date.

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Acquisitions And Dispositions

6 Months Ended

Jun. 30, 2011

Acquisitions And Dispositions

Acquisitions And Dispositions

4. Acquisitions and Dispositions

Acquisition of Premier Portfolio

We purchased twelve industrial and four office buildings, as well as other real estate assets, during the six months ended June 30, 2011. These purchases completed our acquisition of a portfolio of buildings in South Florida (the "Premier Portfolio"), which was placed under contract in 2010, and resulted in cash payments to the sellers of $27.4 million, the assumption of secured loans with a face value of $124.4 million (Note 5) and the issuance to the sellers of 2.1 million Limited Partner Units with a fair value at issuance of $28.4 million, which are included in the Limited Partners' common equity (Note 6). These units are not convertible until early 2012.

On December 30, 2010, we purchased 38 industrial buildings, one office building and other real estate assets within the Premier Portfolio. The allocation of the fair value of the amounts recognized from this acquisition to buildings and other related assets was preliminary at December 31, 2010. The following table summarizes our allocation of the fair value of amounts recognized for each major class of assets and liabilities related to the 55 properties and other real estate assets from the Premier Portfolio that have been purchased through June 30, 2011 (in thousands):

	Year ended December 31, 2010		Six months ended June 30, 2011		Total acquired through June 30, 2011
Real estate assets	$	249,960	$	153,656	$	403,616
Lease-related intangible assets		31,091		25,445		56,536
Other assets		1,801		2,571		4,372
Total acquired assets		282,852		181,672		464,524
Secured debt		158,238		125,003		283,241
Other liabilities		4,075		4,284		8,359
Total assumed liabilities		162,313		129,287		291,600
Fair value of acquired net assets	$	120,539	$	52,385	$	172,924

The leases in the acquired properties had a weighted average remaining life at acquisition of approximately 3.5 years.

Other 2011 Acquisitions

We also acquired four additional properties during the six months ended June 30, 2011. These acquisitions consisted of one bulk industrial property in Southern California, one bulk industrial property in Phoenix, Arizona, one bulk industrial property in Savannah, Georgia and one office property in Atlanta, Georgia. The following table summarizes our allocation of the fair value of amounts recognized for each major class of assets and liabilities (in thousands) for these acquisitions:

Real estate assets	$	70,547
Lease related intangible assets		9,491
Other assets		194
Total acquired assets		80,232
Secured debt		5,470
Other liabilities		311
Total assumed liabilities		5,781
Fair value of acquired net assets	$	74,451

The leases in the acquired properties had a weighted average remaining life at acquisition of approximately 5.9 years.

Fair Value Measurements

The fair value estimates used in allocating the aggregate purchase price of each acquisition among the individual components of real estate assets and liabilities were determined primarily through calculating the "as-if vacant" value of each building, using the income approach, and relied significantly upon internally determined assumptions. As a result, we have, thus, determined these estimates to have been primarily based upon Level 3 inputs, which are unobservable inputs based on our own assumptions. The most significant assumptions utilized in making the lease-up and future disposition estimates used in calculating the "as-if vacant" value of each building acquired during the six months ended June 30, 2011 were as follows:

Discount rate		6.4% - 10.0%
Exit capitalization rate		4.8% - 8.7%
Lease- up period		12 -36 months
Net rental rate per square foot – Industrial	$	3.30 - $6.50
Net rental rate per square foot – Office	$	8.61 - $16.00

Dispositions

We disposed of income-producing real estate assets and undeveloped land and received net proceeds of $498.2 million during the six-month period ended June 30, 2011. Included in the building dispositions in the six months ended June 30, 2011 is the sale, in March 2011, of 13 suburban office buildings, totaling approximately 2.0 million square feet, to an existing 20% owned unconsolidated joint venture. These buildings were sold to the unconsolidated joint venture for $342.8 million and our share of net proceeds totaled $273.7 million.

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Consolidated Statements Of Cash Flows (USD $) In Thousands	6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010
Cash flows from operating activities:
Net income (loss)	$ 50,931	$ (17,992)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation of buildings and tenant improvements	135,809	130,236
Amortization of deferred leasing and other costs	59,285	35,937
Amortization of deferred financing costs	7,351	7,092
Straight-line rent adjustment	(11,887)	(9,083)
Impairment charges		7,974
Loss on debt extinguishment		16,127
Earnings from land and depreciated property sales	(82,664)	(19,898)
Third-party construction contracts, net	(25,658)	(17,407)
Other accrued revenues and expenses, net	264	12,737
Operating distributions received in excess of equity in earnings from unconsolidated companies	10,862	2,597
Net cash provided by operating activities	144,293	148,320
Cash flows from investing activities:
Development of real estate investments	(78,645)	(56,762)
Acquisition of real estate investments and related intangible assets, net of cash acquired	(99,817)	(19,205)
Acquisition of undeveloped land		(4,706)
Second generation tenant improvements, leasing costs and building improvements	(41,284)	(34,805)
Other deferred leasing costs	(13,807)	(16,752)
Other assets	3,149	(28,699)
Proceeds from land and depreciated property sales, net	498,249	151,835
Capital distributions from unconsolidated companies	54,730	3,897
Capital contributions and advances to unconsolidated companies, net	(16,917)	(16,577)
Net cash provided by (used for) investing activities	305,658	(21,774)
Cash flows from financing activities:
Contributions from the General Partner		298,066
Payments for repurchases of Preferred Units	(2,096)	(58,304)
Proceeds from unsecured debt issuance		250,000
Payments on and repurchases of unsecured debt	(43,377)	(387,860)
Proceeds from secured debt financings		4,160
Payments on secured indebtedness including principal amortization	(7,968)	(5,317)
Borrowings (payments) on lines of credit, net	(174,717)	313
Distributions to common unitholders	(88,219)	(78,528)
Distributions to preferred unitholders	(31,948)	(36,726)
Distributions to noncontrolling interests	(58)	(1,631)
Deferred financing costs	(2,342)	(1,970)
Net cash used for financing activities	(350,725)	(17,797)
Net increase in cash and cash equivalents	99,226	108,749
Cash and cash equivalents at beginning of period	18,419	147,539
Cash and cash equivalents at end of period	117,645	256,288
Non-cash investing and financing activities:
Assumption of indebtedness for real estate acquisitions	130,474	4,503
Contribution of properties to unconsolidated companies	52,868	7,002
Conversion of Limited Partner Units to common shares of the General Partner	1,235	4,335
Issuance of Limited Partner Units for acquisition	$ 28,357

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Consolidated Statement Of Changes In Equity (Parenthetical) (USD $)	6 Months Ended
	Jun. 30, 2011
Consolidated Statement Of Changes In Equity
Distributions to Partners, per Common Unit	$ 0.34

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Segment Reporting

6 Months Ended

Jun. 30, 2011

Segment Reporting

Segment Reporting

9. Segment Reporting

We have three reportable operating segments, the first two of which consist of the ownership and rental of (i) office and (ii) industrial real estate investments. The operations of our office and industrial properties, along with our medical office and retail properties, are collectively referred to as "Rental Operations." Our medical office and retail properties do not by themselves meet the quantitative thresholds for separate presentation as reportable segments. The third reportable segment consists of various real estate services such as property management, asset management, maintenance, leasing, development and construction management to third-party property owners and joint ventures, and is collectively referred to as "Service Operations." Our reportable segments offer different products or services and are managed separately because each segment requires different operating strategies and management expertise.

Other revenue consists of other operating revenues not identified with one of our operating segments. Interest expense and other non-property specific revenues and expenses are not allocated to individual segments in determining our performance measure.

We assess and measure our overall operating results based upon an industry performance measure referred to as Funds From Operations ("FFO"), which management believes is a useful indicator of our consolidated operating performance. FFO is used by industry analysts and investors as a supplemental operating performance measure of a REIT like our General Partner. The National Association of Real Estate Investment Trusts ("NAREIT") created FFO as a supplemental measure of REIT operating performance that excludes historical cost depreciation, among other items, from net income determined in accordance with GAAP. FFO is a non-GAAP financial measure. The most comparable GAAP measure is net income (loss) attributable to common unitholders. FFO attributable to common unitholders should not be considered as a substitute for net income (loss) attributable to common unitholders or any other measures derived in accordance with GAAP and may not be comparable to other similarly titled measures of other companies. FFO is calculated in accordance with the definition that was adopted by the Board of Governors of NAREIT. We do not allocate certain income and expenses ("Non-Segment Items", as shown in the table below) to our operating segments. Thus, the operational performance measure presented here on a segment-level basis represents net earnings excluding depreciation expense and the Non-Segment Items not allocated, and is not meant to present FFO as defined by NAREIT.

Historical cost accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, many industry analysts and investors have considered presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. FFO, as defined by NAREIT, represents GAAP net income (loss), excluding extraordinary items as defined under GAAP and gains or losses from sales of previously depreciated real estate assets, plus certain non-cash items such as real estate asset depreciation and amortization and after similar adjustments for unconsolidated partnerships and joint ventures.

Management believes that the use of FFO attributable to common unitholders, combined with net income (which remains the primary measure of performance), improves the understanding of operating results of REITs among the investing public and makes comparisons of REIT operating results more meaningful. Management believes that excluding gains or losses related to sales of previously depreciated real estate assets and excluding real estate asset depreciation and amortization enables investors and analysts to readily identify the operating results of the long-term assets that form the core of a REIT's activity and assist them in comparing these operating results between periods or between different companies.

The following table shows (i) the revenues for each of the reportable segments and (ii) a reconciliation of FFO attributable to common unitholders to net income (loss) attributable to common unitholders for the three and six months ended June 30, 2011 and 2010, respectively (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Revenues
Rental Operations:
Office	$	109,671		$	122,790		$	231,787		$	249,703
Industrial		95,062			62,499			191,345			128,583
Non-reportable Rental Operations segments		19,710			16,725			39,364			32,958
General contractor and service fee revenue ("Service Operations")		135,362			168,398			281,909			282,039
Total Segment Revenues		359,805			370,412			744,405			693,283
Other Revenue		3,265			3,574			5,248			5,840
Consolidated Revenue from continuing operations		363,070			373,986			749,653			699,123
Discontinued Operations		365			11,234			3,485			23,997
Consolidated Revenue	$	363,435		$	385,220		$	753,138		$	723,120
Reconciliation of Funds From Operations
Net earnings excluding depreciation and Non-Segment Items
Office	$	63,250		$	71,588		$	130,376		$	142,867
Industrial		69,093			47,515			136,918			95,850
Non-reportable Rental Operations segments		13,024			11,577			25,398			22,155
Service Operations		12,393			7,781			23,276			14,260
		157,760			138,461			315,968			275,132
Non-Segment Items:
Interest expense		(66,846	)		(58,044	)		(132,950	)		(114,300	)
Impairment charges		—			(7,974	)		—			(7,974	)
Interest and other income		284			204			371			355
Other operating expenses		(26	)		(145	)		(111	)		(422	)
General and administrative expenses		(8,541	)		(9,151	)		(19,738	)		(22,695	)
Undeveloped land carrying costs		(2,453	)		(2,542	)		(4,762	)		(4,793	)
Loss on debt transactions		—			(15,773	)		—			(16,127	)
Acquisition costs		(594	)		—			(1,183	)		—
Other non-segment income		1,541			1,973			2,522			3,722
Net (income) loss attributable to noncontrolling interests		84			(108	)		206			(106	)
Joint venture items		10,352			12,384			18,962			24,572
Distributions on Preferred Units		(15,974	)		(18,363	)		(31,948	)		(36,726	)
Adjustments for repurchase of Preferred Units		—			(4,492	)		(163	)		(4,492	)
Discontinued operations		212			4,289			458			8,440
FFO attributable to common unitholders		75,799			40,719			147,632			104,586
Depreciation and amortization on continuing operations		(100,058	)		(78,956	)		(194,743	)		(159,481	)
Depreciation and amortization on discontinued operations		(55	)		(3,049	)		(351	)		(6,692	)
Partnership's share of joint venture adjustments		(8,639	)		(10,372	)		(16,267	)		(19,935	)
Earnings from depreciated property sales on continuing operations		493			4,973			68,348			7,042
Earnings from depreciated property sales on discontinued operations		2,712			3,078			14,316			12,856
Earnings from depreciated property sales - share of joint venture		—			4			91			2,308
Net income (loss) attributable to common unitholders	$	(29,748	)	$	(43,603	)	$	19,026		$	(59,316	)

The assets for each of the reportable segments as of June 30, 2011 and December 31, 2010 are as follows (in thousands):

	June 30, 2011		December 31, 2010
Assets
Rental Operations:
Office	$	2,769,228	$	3,122,565
Industrial		3,314,481		3,210,566
Non-reportable Rental Operations segments		634,058		627,491
Service Operations		169,559		231,662
Total Segment Assets		6,887,326		7,192,284
Non-Segment Assets		639,379		451,840
Consolidated Assets	$	7,526,705	$	7,644,124

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Consolidated Balance Sheets (USD $) In Thousands	Jun. 30, 2011	Dec. 31, 2010
ASSETS
Land and improvements	$ 1,276,820	$ 1,166,409
Buildings and tenant improvements	5,525,808	5,396,339
Construction in progress	70,424	61,205
Investments in and advances to unconsolidated companies	365,323	367,445
Undeveloped land	617,470	625,353
Real estate investment property, at cost, total	7,855,845	7,616,751
Accumulated depreciation	(1,381,919)	(1,290,417)
Net real estate investments	6,473,926	6,326,334
Real estate investments and other assets held-for-sale		394,287
Cash and cash equivalents	117,645	18,419
Accounts receivable, net of allowance of $3,802 and $2,945	24,741	22,588
Straight-line rent receivable, net of allowance of $7,924 and $7,260	136,171	125,185
Receivables on construction contracts, including retentions	48,263	7,408
Deferred financing costs, net of accumulated amortization of $52,844 and $46,407	42,223	46,317
Deferred leasing and other costs, net of accumulated amortization of $313,986 and $269,000	497,174	517,934
Escrow deposits and other assets	186,562	185,652
Total assets	7,526,705	7,644,124
LIABILITIES AND EQUITY
Secured debt	1,187,044	1,065,628
Unsecured notes	2,906,154	2,948,405
Unsecured lines of credit	18,329	193,046
Total long-term debt	4,111,527	4,207,079
Liabilities related to real estate investments held-for-sale		14,732
Construction payables and amounts due subcontractors, including retentions	67,757	44,782
Accrued real estate taxes	102,695	83,615
Accrued interest	62,046	62,407
Other accrued expenses	38,275	61,354
Other liabilities	136,336	129,860
Tenant security deposits and prepaid rents	53,391	50,450
Total liabilities	4,572,027	4,654,279
Partners' equity:
Common equity (252,663 and 252,195 General Partner Units issued and outstanding)	1,986,945	2,046,617
Preferred equity (3,610 and 3,618 Preferred Units issued and outstanding)	902,540	904,540
Total general partners' equity	2,889,485	2,951,157
Limited Partners' common equity (7,190 and 5,231 Limited Partner Units issued and outstanding)	60,175	34,894
Accumulated other comprehensive income (loss)	56	(1,432)
Total partners' equity	2,949,716	2,984,619
Noncontrolling interests	4,962	5,226
Total equity	2,954,678	2,989,845
Liabilities and partners' capital, total	$ 7,526,705	$ 7,644,124