Guarantor and Non-Guarantor Financial Information

The following condensed consolidating financial information for Piedmont Operating Partnership, L.P. (the "Issuer"), Piedmont Office Realty Trust, Inc. (the "Guarantor"), and the other directly and indirectly owned subsidiaries of the Guarantor (the "Non-Guarantor Subsidiaries") is provided pursuant to the requirements of Rule 3-10 of Regulation S-X regarding financial statements of guarantors and issuers of guaranteed registered securities. The Issuer is a wholly-owned subsidiary of the Guarantor, and all guarantees by the Guarantor of securities issued by the Issuer are full and unconditional. The principal elimination entries relate to investments in subsidiaries and intercompany balances and transactions, including transactions with the Non-Guarantor Subsidiaries.



Condensed Consolidated Balance Sheets
As of December 31, 2015
(in thousands)	Issuer		Guarantor			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets:
Real estate assets, at cost:
Land	$	64,218	$	—		$	621,632	$	—		$	685,850
Buildings and improvements, less accumulated depreciation	336,897		—			2,567,706		(300		)	2,904,303
Intangible lease assets, less accumulated amortization	1,268		—			83,395		—			84,663
Construction in progress	255		—			20,735		—			20,990
Total real estate assets	402,638		—			3,293,468		(300		)	3,695,806
Investments in and amounts due from unconsolidated joint ventures	7,577		—			—		—			7,577
Cash and cash equivalents	2,174		150			3,117		—			5,441
Tenant and straight-line receivables, net	28,467		—			149,994		—			178,461
Advances to affiliates	6,073,606		1,251,530			—		(7,325,136		)	—
Investment in subsidiary	—		3,752,523			186		(3,752,709		)	—
Notes receivable	134,750		—			23,890		(113,240		)	45,400
Prepaid expenses, restricted cash, escrows, and other assets	7,157		—			24,118		(1,258		)	30,017
Goodwill	180,097		—			—		—			180,097
Deferred lease costs, net	24,634		—			267,102		—			291,736
Total assets	$	6,861,100	$	5,004,203		$	3,761,875	$	(11,192,643	)	$	4,434,535
Liabilities:
Debt	$	1,552,007	$	—		$	590,743	$	(113,240	)	$	2,029,510
Accounts payable, accrued expenses, and accrued capital expenditures	18,954		580			110,189		(1,258		)	128,465
Advances from affiliates	580,526		5,033,266			1,788,840		(7,402,632		)	—
Deferred income	5,905		—			21,365		—			27,270
Intangible lease liabilities, net	—		—			42,853		—			42,853
Interest rate swaps	9,993		—			—		—			9,993
Total liabilities	2,167,385		5,033,846			2,553,990		(7,517,130		)	2,238,091
Stockholders’ Equity:
Common stock	—		1,455			—		—			1,455
Additional paid-in capital	3,748,524		3,672,849			1,314		(3,752,710		)	3,669,977
Cumulative distributions in excess of earnings	943,530		(3,703,947		)	1,205,546		77,197			(1,477,674		)
Other comprehensive loss	1,661		—			—		—			1,661
Piedmont stockholders’ equity	4,693,715		(29,643		)	1,206,860		(3,675,513		)	2,195,419
Noncontrolling interest	—		—			1,025		—			1,025
Total stockholders’ equity	4,693,715		(29,643		)	1,207,885		(3,675,513		)	2,196,444
Total liabilities and stockholders’ equity	$	6,861,100	$	5,004,203		$	3,761,875	$	(11,192,643	)	$	4,434,535



Condensed Consolidated Balance Sheets
As of December 31, 2014
(in thousands)	Issuer		Guarantor			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets:
Real estate assets, at cost:
Land	$	77,125	$	—		$	597,429	$	—		$	674,554
Buildings and improvements, less accumulated depreciation	414,515		—			2,327,368		(300		)	2,741,583
Intangible lease assets, less accumulated amortization	1,812		—			68,365		—			70,177
Construction in progress	1,345		—			60,546		—			61,891
Real estate assets held for sale, net	46,354		—			480,533		—			526,887
Total real estate assets	541,151		—			3,534,241		(300		)	4,075,092
Investments in and amounts due from unconsolidated joint ventures	7,798		—			—		—			7,798
Cash and cash equivalents	8,143		1,790			2,373		—			12,306
Tenant and straight-line rent receivables, net	35,363		—			139,184		—			174,547
Advances to affiliates	6,084,243		1,282,443			—		(7,366,686		)	—
Investment in subsidiary	—		3,878,811			192		(3,879,003		)	—
Notes receivable	161,350		—			23,890		(185,240		)	—
Prepaid expenses, restricted cash, escrows, and other assets	10,897		—			21,392		(954		)	31,335
Goodwill	180,097		—			—		—			180,097
Interest rate swaps	430		—			—		—			430
Deferred lease costs, net	29,696		—			199,257		—			228,953
Other assets held for sale, net	4,798		—			72,478		—			77,276
Total assets	$	7,063,966	$	5,163,044		$	3,993,007	$	(11,432,183	)	$	4,787,834
Liabilities:
Debt	$	1,845,192	$	—		$	609,970	$	(185,240	)	$	2,269,922
Accounts payable, accrued expenses, and accrued capital expenditures	19,403		465			115,074		(954		)	133,988
Advances from affiliates	376,122		4,909,362			2,138,140		(7,423,624		)	—
Deferred income	4,998		—			17,217		—			22,215
Intangible lease liabilities, net	—		—			42,560		—			42,560
Interest rate swaps	6,417		—			—		—			6,417
Other liabilities held for sale, net	—		—			717		—			717
Total liabilities	2,252,132		4,909,827			2,923,678		(7,609,818		)	2,475,819
Stockholders’ Equity:
Common stock	—		1,543			—		—			1,543
Additional paid-in capital	3,874,757		3,670,236			192		(3,879,003		)	3,666,182
Cumulative distributions in excess of earnings	928,776		(3,418,562		)	1,067,528		56,638			(1,365,620		)
Other comprehensive loss	8,301		—			—		—			8,301
Piedmont stockholders’ equity	4,811,834		253,217			1,067,720		(3,822,365		)	2,310,406
Noncontrolling interest	—		—			1,609		—			1,609
Total stockholders’ equity	4,811,834		253,217			1,069,329		(3,822,365		)	2,312,015
Total liabilities and stockholders’ equity	$	7,063,966	$	5,163,044		$	3,993,007	$	(11,432,183	)	$	4,787,834



Condensed Consolidated Statements of Income
For the year ended December 31, 2015
(in thousands)	Issuer			Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Rental income	$	67,317		$	—		$	404,460		$	(2,905	)	$	468,872
Tenant reimbursements	13,340			—			100,955			(414		)	113,881
Property management fee revenue	—			—			17,801			(15,785		)	2,016
	80,657			—			523,216			(19,104		)	584,769
Expenses:
Property operating costs	36,358			—			225,428			(19,786		)	242,000
Depreciation	20,891			—			113,612			—			134,503
Amortization	4,598			—			56,288			—			60,886
Impairment loss on real estate assets	5,354			—			34,815			—			40,169
General and administrative	29,667			341			35,923			(35,563		)	30,368
	96,868			341			466,066			(55,349		)	507,926
Real estate operating income/(loss)	(16,211		)	(341		)	57,150			36,245			76,843
Other income (expense):
Interest expense	(51,704		)	—			(33,540		)	11,246			(73,998		)
Interest income and other income	12,600			—			211			(11,246		)	1,565
Net recoveries/(loss) from casualty events and litigation settlements	23			—			(301		)	—			(278		)
Equity in income of unconsolidated joint ventures	553			—			—			—			553
	(38,528		)	—			(33,630		)	—			(72,158		)
Income/(loss) from continuing operations	(54,739		)	(341		)	23,520			36,245			4,685
Discontinued operations:
Operating income	15			—			69			—			84
Loss on sale of real estate assets	(1		)	—			—			—			(1		)
Income from discontinued operations	14			—			69			—			83
Gain on sale of real estate assets	53,795			—			114,442			—			168,237
Net income/(loss)	(930		)	(341		)	138,031			36,245			173,005
Less: Net income attributable to noncontrolling interest	—			—			(15		)	—			(15		)
Net income/(loss) attributable to Piedmont	$	(930	)	$	(341	)	$	138,016		$	36,245		$	172,990



Condensed Consolidated Statements of Income
For the year ended December 31, 2014
(in thousands)	Issuer			Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Rental income	$	72,843		$	—		$	386,995		$	(5,203	)	$	454,635
Tenant reimbursements	16,566			—			93,516			(534		)	109,548
Property management fee revenue	—			—			16,516			(14,447		)	2,069
	89,409			—			497,027			(20,184		)	566,252
Expenses:
Property operating costs	42,626			—			217,786			(20,976		)	239,436
Depreciation	23,512			—			115,084			—			138,596
Amortization	4,754			—			51,825			—			56,579
General and administrative	23,230			300			28,232			(27,942		)	23,820
	94,122			300			412,927			(48,918		)	458,431
Real estate operating income/(loss)	(4,713		)	(300		)	84,100			28,734			107,821
Other income (expense):
Interest expense	(47,355		)	—			(39,625		)	12,534			(74,446		)
Interest income and other income	11,944			—			652			(12,534		)	62
Net recoveries from casualty events and litigation settlements	1,322			1,479			4,191			—			6,992
Equity in loss of unconsolidated joint ventures	(350		)	—			—			—			(350		)
	(34,439		)	1,479			(34,782		)	—			(67,742		)
Income/(loss) from continuing operations	(39,152		)	1,179			49,318			28,734			40,079
Discontinued operations:
Operating income	913			—			41			—			954
Gain on sale of real estate assets	450			—			748			—			1,198
Income from discontinued operations	1,363			—			789			—			2,152
Gain on sale of real estate assets	—			—			1,132			—			1,132
Net income/(loss)	(37,789		)	1,179			51,239			28,734			43,363
Less: Net income attributable to noncontrolling interest	—			—			(15		)	—			(15		)
Net income/(loss) attributable to Piedmont	$	(37,789	)	$	1,179		$	51,224		$	28,734		$	43,348



Condensed Consolidated Statements of Income
For the year ended December 31, 2013
(in thousands)	Issuer			Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Rental income	$	72,911		$	—		$	375,477		$	(5,282	)	$	443,106
Tenant reimbursements	16,292			—			88,381			(420		)	104,253
Property management fee revenue	—			—			15,360			(13,109		)	2,251
	89,203			—			479,218			(18,811		)	549,610
Expenses:
Property operating costs	39,602			—			200,503			(19,326		)	220,779
Depreciation	22,351			—			98,629			—			120,980
Amortization	5,070			—			40,020			—			45,090
General and administrative	21,009			337			24,927			(24,392		)	21,881
	88,032			337			364,079			(43,718		)	408,730
Real estate operating income/(loss)	1,171			(337		)	115,139			24,907			140,880
Other income (expense):
Interest expense	(22,242		)	—			(63,900		)	12,559			(73,583		)
Interest income and other income/(expense)	10,630			164			(571		)	(12,559		)	(2,336		)
Net recoveries from casualty events and litigation settlements	683			—			11,128			—			11,811
Equity in loss of unconsolidated joint ventures	(3,676		)	—			—			—			(3,676		)
Loss on consolidation	(898		)	—			—			—			(898		)
	(15,503		)	164			(53,343		)	—			(68,682		)
Income/(loss) from continuing operations	(14,332		)	(173		)	61,796			24,907			72,198
Discontinued operations:
Operating income	2,312			—			585			—			2,897
Impairment loss on real estate assets	(7,644		)	—			—			—			(7,644		)
Gain on sale of real estate assets	15,046			—			16,246			—			31,292
Income from discontinued operations	9,714			—			16,831			—			26,545
Net income/(loss)	(4,618		)	(173		)	78,627			24,907			98,743
Less: Net income attributable to noncontrolling interest	—			—			(15		)	—			(15		)
Net income/(loss) attributable to Piedmont	$	(4,618	)	$	(173	)	$	78,612		$	24,907		$	98,728



Condensed Consolidated Statements of Cash Flows
For the year ended December 31, 2015
(in thousands)	Issuer			Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net Cash Provided by/(used in) Operating Activities	$	(27,077	)	$	2,989		$	205,177		$	36,245		$	217,334

Cash Flows from Investing Activities:
Acquisition of real estate assets, related intangibles and capitalized expenditures, net of accruals	(12,203		)	—			(489,241		)	—			(501,444		)
Intercompany note receivable	72,000			—			—			(72,000		)	—
Redemption of noncontrolling interest in unconsolidated variable interest entity	—			—			(4,000		)	—			(4,000		)
Net sales proceeds from wholly-owned properties	151,557			—			696,612			—			848,169
Deferred lease costs paid	(3,792		)	—			(33,891		)	—			(37,683		)
Net cash provided by investing activities	207,562			—			169,480			(72,000		)	305,042
Cash Flows from Financing Activities:
Debt issuance costs paid	(575		)	—			(506		)	—			(1,081		)
Proceeds from debt	1,142,577			—			159,281			—			1,301,858
Repayments of debt	(1,438,000		)	—			(106,301		)				(1,544,301		)
Intercompany note payable	—			—			(72,000		)	72,000			—
Costs of issuance of common stock	—			(326		)	—			—			(326		)
Repurchases of common stock as part of announced plan	—			(158,860		)	—			—			(158,860		)
Intercompany distributions	109,544			281,073			(354,372		)	(36,245		)	—
Dividends paid and discount on dividend reinvestments	—			(126,516		)	(15		)	—			(126,531		)
Net cash used in financing activities	(186,454		)	(4,629		)	(373,913		)	35,755			(529,241		)
Net increase/(decrease) in cash and cash equivalents	(5,969		)	(1,640		)	744			—			(6,865		)
Cash and cash equivalents, beginning of year	8,143			1,790			2,373			—			12,306
Cash and cash equivalents, end of year	$	2,174		$	150		$	3,117		$	—		$	5,441



Condensed Consolidated Statements of Cash Flows
For the year ended December 31, 2014
(in thousands)	Issuer			Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net Cash Provided by Operating Activities	$	5,448		$	2,813		$	178,889		$	28,733		$	215,883

Cash Flows from Investing Activities:
Acquisition of real estate assets, related intangibles and capitalized expenditures, net of accruals	(23,541		)	—			(267,918		)	—			(291,459		)
Intercompany note receivable	650			—			—			(650		)	—
Net sales proceeds from wholly-owned properties	29,519			—			16,713			—			46,232
Net sales proceeds received from unconsolidated joint ventures	6,017			—			—			—			6,017
Investments in unconsolidated joint ventures	(42		)	—			—			—			(42		)
Deferred lease costs paid	(4,472		)	—			(23,222		)	—			(27,694		)
Net cash provided by/(used in) investing activities	8,131			—			(274,427		)	(650		)	(266,946		)
Cash Flows from Financing Activities:
Debt issuance costs paid	(1,294		)	—			—			—			(1,294		)
Proceeds from debt	1,052,527			—			—			—			1,052,527
Repayments of debt	(238,000		)	—			(575,702		)	—			(813,702		)
Discount due to loan modification	(1,135		)	—			—			—			(1,135		)
Intercompany note payable	—			—			(650		)	650			—
Repurchases of common stock as part of announced plan	—			(54,802		)	—			—			(54,802		)
Intercompany distributions	(820,795		)	178,812			670,716			(28,733		)	—
Dividends paid and discount on dividend reinvestments	—			(125,183		)	(15		)	—			(125,198		)
Net cash provided by/(used in) financing activities	(8,697		)	(1,173		)	94,349			(28,083		)	56,396
Net increase/(decrease) in cash and cash equivalents	4,882			1,640			(1,189		)	—			5,333
Cash and cash equivalents, beginning of year	3,261			150			3,562			—			6,973
Cash and cash equivalents, end of year	$	8,143		$	1,790		$	2,373		$	—		$	12,306



Condensed Consolidated Statements of Cash Flows
For the year ended December 31, 2013
(in thousands)	Issuer			Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net Cash Provided by Operating Activities	$	15,327		$	1,853		$	172,992		$	24,907		$	215,079

Cash Flows from Investing Activities:
Acquisition of real estate assets, related intangibles and capitalized expenditures, net of accruals	(10,382		)	—			(532,088		)	300			(542,170		)
Intercompany note receivable	—			500			—			(500		)	—
Cash assumed upon consolidation of variable interest entity	18,045			—			(32,287		)	—			(14,242		)
Net sales proceeds from wholly-owned properties	50,118			—			45,553			—			95,671
Investments in unconsolidated joint ventures	(793		)	—			—			—			(793		)
Deferred lease costs paid	(10,980		)	—			(23,318		)	—			(34,298		)
Net cash provided by/(used in) investing activities	46,008			500			(542,140		)	(200		)	(495,832		)
Cash Flows from Financing Activities:
Debt issuance costs paid	(4,892		)	—			—			—			(4,892		)
Proceeds from debt	1,085,604			—			—			—			1,085,604
Repayments of debt	(500,000		)	—			—			—			(500,000		)
Intercompany note payable	—			—			(500		)	500			—
Net costs of issuance of common stock	—			(91		)	—			—			(91		)
Repurchases of common stock as part of announced plan	—			(173,551		)	—			—			(173,551		)
Intercompany distributions	(701,071		)	303,486			422,792			(25,207		)	—
Dividends paid and discount on dividend reinvestments	—			(132,286		)	(15		)	—			(132,301		)
Net cash provided by/(used in) financing activities	(120,359		)	(2,442		)	422,277			(24,707		)	274,769
Net increase/(decrease) in cash and cash equivalents	(59,024		)	(89		)	53,129			—			(5,984		)
Cash and cash equivalents, beginning of year	62,285			239			(49,567		)	—			12,957
Cash and cash equivalents, end of year	$	3,261		$	150		$	3,562		$	—		$	6,973