10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

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

For the quarterly period ended September 30, 2007

or

o 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: 000-52891

CORPORATE PROPERTY ASSOCIATES 17 – GLOBAL INCORPORATED

(Exact name of registrant as specified in its charter)

Maryland	20-8429087
(State of incorporation)	(I.R.S. Employer Identification No.)

50 Rockefeller Plaza
New York, New York	10020
(Address of principal executive office)	(Zip Code)

Investor Relations (212) 492-8920
(212) 492-1100
(Registrant’s telephone numbers, including area code)

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 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 o      No þ

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

Large accelerated filer o      Accelerated filer o      Non-accelerated filer þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o      No þ

Registrant has 22,222 shares of common stock, $.001 par value outstanding at December 7, 2007.

INDEX

	Page No.
PART I — FINANCIAL INFORMATION
Item 1. — Financial Statements*
Balance Sheets as of September 30, 2007 and February 20, 2007		2
Statements of Operations for the three months ended September 30, 2007 and the period from inception (February 20, 2007) through September 30, 2007		3
Statement of Cash Flows for the period from inception (February 20, 2007) through September 30, 2007		4
Notes to Financial Statements		5
Item 2. — Management’s Discussion and Analysis of Financial Condition and Results of Operations		10
Item 3. — Quantitative and Qualitative Disclosures About Market Risk		11
Item 4T. — Controls and Procedures		11
PART II — OTHER INFORMATION
Item 2. — Unregistered Sales of Equity Securities and Use of Proceeds		11
Item 6. — Exhibits		11
Signatures		12
EX-3.1: ARTICLES OF AMENDMENT AND RESTATEMENT
EX-3.2: BYLAWS
EX-4.1: DISTRIBUTION REINVESTMENT AND STOCK PURCHASE PLAN
EX-10.1: ADVISORY AGREEMENT
EX-10.2: AGREEMENT OF LIMITED PARTNERSHIP
EX-10.3: SALES AGENCY AGREEMENT
EX-31.1: CERTIFICATION
EX-31.2: CERTIFICATION
EX-32: CERTIFICATIONS

* The summarized financial statements contained herein are unaudited; however, in the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair statement of such financial statements have been included.

Forward Looking Statements

This quarterly report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 2 of Part I of this report, contains forward-looking statements that involve risks, uncertainties and assumptions. Forward-looking statements discuss matters that are not historical facts. Because they discuss future events or conditions, forward-looking statements may include words such as “anticipate,” “believe,” “expect,” “estimate,” “intend,” “could,” “should,” “would,” “may,” “seek,” “plan” or similar expressions. Do not unduly rely on forward-looking statements. They give our expectations about the future and are not guarantees, and speak only as of the date they are made. Such statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievement to be materially different from the results of operations or plan expressed or implied by such forward-looking statements. While we cannot predict all of the risks and uncertainties, they include, but are not limited to, the risk factors described in our Registration Statement on Form S-11 dated November 2, 2007. Accordingly, such information should not be regarded as representations that the results or conditions described in such statements or that our objectives and plans will be achieved.

As used in this quarterly report on Form 10-Q, the terms “we,” “us” and “our” represent Corporate Property Associates 17 – Global Incorporated, unless otherwise indicated.

CPA^®:17 – Global 9/30/2007 10-Q — 1

CORPORATE PROPERTY ASSOCIATES 17 – GLOBAL INCORPORATED

PART I

ITEM 1. — FINANCIAL STATEMENTS

BALANCE SHEETS (UNAUDITED)

	September 30, 2007			February 20, 2007
				(NOTE)
Assets
Cash and cash equivalents	$	200,000		$	200,000
Deferred offering costs		1,557,513			—
Total assets	$	1,757,513		$	200,000
Liabilities
Due to affiliates	$	1,597,797		$	—
Commitments and contingencies (Note 4)
Stockholders’ Equity
Common stock, $0.001 par value; authorized 25,000 shares; issued and outstanding, 22,222 shares		22			22
Additional paid-in capital		199,978			199,978
Accumulated deficit		(40,284	)		—
Total stockholders’ equity		159,716			200,000
Total liabilities and stockholders’ equity	$	1,757,513		$	200,000

Note: The balance sheet at February 20, 2007 has been derived from the audited financial statement at that date.

The accompanying notes are an integral part of these financial statements.

CPA^®:17 – Global 9/30/2007 10-Q — 2

CORPORATE PROPERTY ASSOCIATES 17 – GLOBAL INCORPORATED

STATEMENTS OF OPERATIONS (UNAUDITED)

For the period from inception (February 20, 2007) through September 30, 2007

			Period from Inception
	Three Months Ended		(February 20, 2007) to
	September 30, 2007		September 30, 2007
Expenses
General and administrative	$	—	$	(40,284	)
Net Loss	$	—	$	(40,284	)
Loss Per Share	$	—	$	(1.81	)
Weighted Average Shares Outstanding		22,222		22,222

The accompanying notes are an integral part of these financial statements.

CPA^®:17 – Global 9/30/2007 10-Q — 3

CORPORATE PROPERTY ASSOCIATES 17 – GLOBAL INCORPORATED

STATEMENT OF CASH FLOWS (UNAUDITED)

For the period from inception (February 20, 2007) through September 30, 2007

Cash Flows — Operating Activities
Net loss	$	(40,284	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Noncash expenses — offering costs		40,284
Net cash provided by operating activities		—
Cash Flows — Financing Activities
Proceeds from stock issuance		200,000
Net cash provided by financing activities		200,000
Net increase in cash and cash equivalents:		200,000
Cash and cash equivalents, beginning of period		—
Cash and cash equivalents, end of period	$	200,000
Noncash investing and financing activities:
(a) Offering costs deferred to date total $1,557,513.
(b) Amounts due to affiliate for offering and organization costs total $1,597,797 to date.

The accompanying notes are an integral part of these financial statements.

CPA^®:17 – Global 9/30/2007 10-Q — 4

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Note 1. Organization and Offering

Organization

Corporate Property Associates 17 – Global Incorporated, a Maryland corporation was formed in February 2007 for the purpose of investing in a diversified portfolio of income-producing commercial properties and other real estate related assets, both domestically and outside the United States. We intend to qualify as a real estate investment trust (“REIT”) and intend to conduct substantially all of our investment activities and own all of our assets through CPA:17 Limited Partnership, our operating partnership. We are a general partner and a limited partner and own a 99.985% capital interest in the operating partnership.W. P. Carey Holdings, LLC (“Carey Holdings”), a subsidiary of W. P. Carey & Co. LLC (“W. P. Carey”), holds a special general partner interest in the operating partnership. We had not begun operations as of September 30, 2007.

Carey Asset Management Corp., a subsidiary of W. P. Carey, is our advisor and will manage our business. The advisor also currently manages three other affiliated Corporate Property Associates REITs.

Public Offering

On November 2, 2007, our registration statement on Form S-11 (File No. 333-140842), covering an initial public offering of up to 200,000,000 shares of common stock at $10.00 per share was declared effective under the Securities Act of 1933, as amended. The registration statement also covers the offering of up to 50,000,000 shares of common stock at $9.50 pursuant to our distribution reinvestment and stock purchase plan. Our initial public offering is being offered on a “best efforts” basis by Carey Financial, LLC, an affiliate of the advisor (“Carey Financial”), and selected other dealers.

We intend to use the net proceeds of the offering to acquire, own and manage a portfolio of commercial properties leased to a diversified group of companies primarily on a single tenant net lease basis.

On February 20, 2007, W. P. Carey purchased 22,222 shares of common stock for $200,000 and was admitted as our initial stockholder. W. P. Carey purchased its shares at $9.00 per share, net of commissions and fees, which would have otherwise been payable to Carey Financial.

Note 2. Summary of Significant Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Basis of Consolidation

When we obtain an economic interest in an entity, we evaluate the entity to determine if the entity is deemed a variable interest entity (“VIE”), and if we are deemed to be the primary beneficiary, in accordance with Financial Accounting Standards Board (“FASB”) Interpretation No. 46R, “Consolidation of Variable Interest Entities” (“FIN 46R”). We consolidate (i) entities that are VIEs and of which we are deemed to be the primary beneficiary and (ii) entities that are non-VIEs which we control. Entities that we account for under the equity method (i.e. at cost, increased or decreased by our share of earnings or losses, less distributions) include (i) entities that are VIEs and of which we are not deemed to be the primary beneficiary and (ii) entities that are non-VIEs which we do not control, but over which we have the ability to exercise significant influence. We will reconsider our determination of whether an entity is a VIE and who the primary beneficiary is if certain events occur that are likely to cause a change in the original determinations.

In accordance with FIN 46R, we deem the operating partnership to be a VIE as we, primarily through our advisory agreement with the advisor, have the ability to make decisions about the operating partnership’s activities that will have a significant effect on the operating partnership’s success. We also deem that we are the primary beneficiary of the operating partnership. As a result, we expect to consolidate our investment in the operating partnership.

Cash and Cash Equivalents and Short-Term Investments

We consider all short-term, highly liquid investments that are both readily convertible to cash and have a maturity of generally three months or less at the time of purchase to be cash equivalents. Items to be classified as cash equivalents include commercial paper and money-market funds. Our cash and cash equivalents are held in the custody of one financial institution, and these balances exceed

CPA^®:17 – Global 9/30/2007 10-Q — 5

Notes to Financial Statements

federally insurable limits. We mitigate this risk by depositing funds with major financial institutions. Instruments that have a maturity of three months or more at the time of purchase will be classified as short-term investments in the financial statements.

Purchase Price Allocation

In connection with our acquisition of properties, purchase costs will be allocated to the tangible and intangible assets and liabilities acquired based on their estimated fair values. The value of the tangible assets, consisting of land, buildings and tenant improvements, will be determined as if vacant. Intangible assets including the above-market value of leases, the value of in-place leases and the value of tenant relationships will be recorded at their relative fair values. The below-market value of leases will also be recorded at the relative fair values.

Above-market and below-market in-place lease values for owned properties will be recorded based on the present value (using an interest rate reflecting the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the leases negotiated and in place at the time of acquisition of the properties and (ii) management’s estimate of fair market lease rates for the property or equivalent property, measured over a period equal to the remaining non-cancelable term of the lease. The capitalized above-market lease value will be amortized as a reduction of rental income over the remaining non-cancelable term of each lease. The capitalized below-market lease value will be amortized as an increase to rental income over the initial term and any fixed rate renewal periods in the respective leases.

The total amount of other intangibles will be allocated to in-place lease values and tenant relationship intangible values based on management’s evaluation of the specific characteristics of each tenant’s lease and our overall relationship with each tenant. Characteristics that are considered in allocating these values include the nature and extent of the existing relationship with the tenant, prospects for developing new business with the tenant, the tenant’s credit quality and the expectation of lease renewals among other factors. Third party appraisals or management’s estimates will be used to determine these values.

Factors considered in the analysis include the estimated carrying costs of the property during a hypothetical expected lease-up period, current market conditions and costs to execute similar leases. Management also considers information obtained about a property in connection with its pre-acquisition due diligence. Estimated carrying costs include real estate taxes, insurance, other property operating costs and estimates of lost rentals at market rates during the hypothetical expected lease-up periods, based on management’s assessment of specific market conditions. Management also considers estimated costs to execute leases, including commissions and legal costs, to the extent that such costs are not already incurred with a new lease that has been negotiated in connection with the purchase of the property.

Intangibles for both in-place and above-market leases will be amortized to expense over the remaining initial lease term while intangibles for both tenant relationships and below-market leases will be amortized to expense over the remaining initial lease term and any expected renewal terms. No amortization period for any intangible asset will exceed the remaining depreciable life of the building. In the event that a lease is terminated, the unamortized portion of each intangible will be charged to expense.

Depreciation

Depreciation of building and related improvements will be computed using the straight-line method over the estimated useful lives of the properties (generally up to 40 years). Depreciation of tenant improvements will be computed using the straight-line method over the lesser of the remaining term of the lease or the estimated useful life.

Federal Income Taxes

We intend to qualify as a REIT under the Internal Revenue Code of 1986 (the “Code”) beginning with our taxable year ending December 31, 2007. In order to maintain our qualification as a REIT, we will be required to, among other things, distribute at least 90% of our REIT taxable income to our stockholders and meet certain tests regarding the nature of our income and assets. Under the Code, REITs are subject to numerous organizational and operational requirements including limitations on certain types of gross income. As a REIT, we generally will not be subject to U.S. federal income tax on income that we distribute to stockholders as long as we meet such requirements and distribute at least 90% of our net taxable income (excluding net capital gains) on an annual basis. If we fail to qualify for taxation as a REIT for any taxable year, our income will be taxed at regular corporate rates, and we may not be able to qualify for treatment as a REIT for that year and the next four years. Even if we qualify as a REIT for U.S. federal income tax purposes, we may be subject to federal, state, local and foreign taxes on our income and property and to income and excise taxes on our U.S. undistributed income.

Organization and Offering Costs

During the offering period, we will accrue costs incurred in connection with the raising of capital as deferred offering costs. Upon receipt of offering proceeds, we will charge the deferred costs to stockholders’ equity and will reimburse the advisor for costs incurred

CPA^®:17 – Global 9/30/2007 10-Q — 6

Notes to Financial Statements

(Note 4). Such reimbursements will not exceed regulatory cost limitations. Organization costs are expensed as incurred and are included in general and administrative expenses in the financial statements.

Earnings (Loss) Per Share

We have a simple equity capital structure with only common stock outstanding. As a result, earnings (loss) per share, as presented, represents both basic and dilutive per-share amounts for all periods presented in the financial statements.

Recent Accounting Pronouncements

SOP 07-1

In June 2007, the Accounting Standards Executive Committee of the American Institute of Certified Public Accountants (“AICPA”) issued Statement of Position 07-1, “Clarification of the Scope of the Audit and Accounting Guide Investment Companies and Accounting by Parent Companies and Equity Method Investors for Investments in Investment Companies” (“SOP 07-1”). SOP 07-1 addresses when the accounting principles of the AICPA Audit and Accounting Guide “Investment Companies” must be applied by an entity and whether investment company accounting must be retained by a parent company in consolidation or by an investor in the application of the equity method of accounting. In addition, SOP 07-1 includes certain disclosure requirements for parent companies and equity method investors in investment companies that retain investment company accounting in the parent company’s consolidated financial statements or the financial statements of an equity method investor. SOP 07-1 was to be effective for our 2008 fiscal year, however, in October 2007 the FASB agreed to propose an indefinite delay of the effective dates of SOP 07-1 and FIN 46(R)-7. We are currently assessing the potential impact that the adoption of SOP 07-1 will have on our financial position and results of operations.

FIN 46(R)-7

In May 2007, the FASB issued Staff Position No. FIN 46(R)-7, “Application of FASB Interpretation No. 46(R) to Investment Companies” (“FIN 46R-7”). FIN 46R-7 makes permanent the temporary deferral of the application of the provisions of FIN 46R to unregistered investment companies, and extends the scope exception from applying FIN 46R to include registered investment companies. FIN 46R-7 is effective upon adoption of SOP 07-1. We are currently assessing the potential impact that the adoption of FIN 46R-7 will have on our financial position and results of operations.

Note 3. Agreements and Transactions with Related Parties

Pursuant to an advisory agreement between the advisor and us, the advisor performs certain services for us including the identification, evaluation, negotiation, financing, purchase and disposition of investments, our day-to-day management and the performance of certain administrative duties. The advisory agreement between the advisor and us provides for the advisor to be reimbursed for organization and offering costs incurred in connection with our offering. The advisor will also receive acquisition fees, a portion of which will be payable upon acquisition of investments with the remainder subordinated to a preferred return. Acquisition fees payable to the advisor with respect to our long-term net lease investments may be up to an average of 4.5% of the total cost of those investments, with 2.5% generally paid when the transaction is completed and 2% generally paid over three years, once the preferred return criterion has been met. For certain types of non-long term net lease investments, initial acquisition fees may range from 0% to 1.75% of the equity invested plus the related acquisition fees, with no deferred acquisition fee being payable. We will also pay the advisor an annual asset management fee ranging from 0.5% of average market value, for long-term net leases and certain other types of real estate investments to 1.75% of average equity value for certain types of securities. An affiliate of the advisor will also receive up to 10% of distributions of available cash of the operating partnership, depending on the type of investments we own. The advisor may also receive subordinated disposition fees of up to 3% of the contract sales price of an investment or up to 1% of the average equity value, depending on the type of investment, for services provided in connection with our liquidation. No such fees have been incurred as of September 30, 2007.

Pursuant to a sales agency agreement between Carey Financial and us, Carey Financial will receive a selling commission of up to $0.65 per share sold, a selected dealer fee of up to $0.20 per share sold and a wholesaling fee of up to $0.15 per share, a significant portion of which is expected to be reallowed to the selected broker dealers. No such payments have been incurred as of September 30, 2007.

Note 4. Commitments and Contingencies

As of September 30, 2007, we were not involved in any material litigation.

In March 2004, following a broker-dealer examination of Carey Financial, the wholly-owned broker-dealer subsidiary of the advisor, by the staff of the SEC, Carey Financial received a letter from the staff of the SEC alleging certain infractions by Carey Financial of

CPA^®:17 – Global 9/30/2007 10-Q — 7

Notes to Financial Statements

the Securities Act of 1933, the Securities Exchange Act of 1934, the rules and regulations thereunder and those of the Financial Industry Regulatory Authority, “FINRA” (formerly known as the National Association of Securities Dealers, Inc.).

The staff alleged that in connection with a public offering of CPA^®:15’s shares, Carey Financial and its retail distributors sold certain securities without an effective registration statement. Specifically, the staff alleged that the delivery of investor funds into escrow after completion of the first phase of the offering (the “Phase I Offering”), completed in the fourth quarter of 2002 but before a registration statement with respect to the second phase of the offering (the “Phase II Offering”) became effective in the first quarter of 2003, constituted sales of securities in violation of Section 5 of the Securities Act of 1933. In addition, in the March 2004 letter the staff raised issues about whether actions taken in connection with the Phase II offering were adequately disclosed to investors in the Phase I Offering.

In June 2004, the Division of Enforcement of the SEC (“Enforcement Staff”) commenced an investigation into compliance with the registration requirements of the Securities Act of 1933 in connection with the public offerings of CPA^®:15’s shares during 2002 and 2003. In December 2004, the scope of the Enforcement Staff’s inquiries broadened to include broker-dealer compensation arrangements in connection with CPA^®:15 and other REITs managed by the advisor, as well as the disclosure of such arrangements. At that time the advisor and Carey Financial received a subpoena from the Enforcement Staff seeking documents relating to payments by the advisor, Carey Financial, and REITs managed by the advisor to (or requests for payment received from) any broker-dealer, excluding selling commissions and selected dealer fees. The advisor and Carey Financial subsequently received additional subpoenas and requests for information from the Enforcement Staff seeking, among other things, information relating to any revenue sharing agreements or payments (defined to include any payment to a broker-dealer, excluding selling commissions and selected dealer fees) made by the advisor, Carey Financial or any REIT managed by the advisor in connection with the distribution of the advisor’s managed REITs or the retention or maintenance of REIT assets. Other information sought by the SEC includes information concerning the accounting treatment and disclosure of any such payments, communications with third parties (including other REIT issuers) concerning revenue sharing, and documents concerning the calculation of underwriting compensation in connection with the REIT offerings under applicable FINRA rules.

In response to the Enforcement Staff’s subpoenas and requests, the advisor and Carey Financial have produced documents relating to payments made to certain broker-dealers both during and after the offering process, for certain of the REITs managed by the advisor (including Corporate Property Associates 10 Incorporated (“CPA^®:10”), Carey Institutional Properties Incorporated (“CIP^®”), Corporate Property Associates 12 Incorporated (“CPA^®:12”), Corporate Property Associates 14 Incorporated (“CPA^®:14”) and Corporate Property Associates 15 Incorporated (“CPA^®:15”), in addition to selling commissions and selected dealer fees.

Among the payments reflected on documents produced to the Staff were certain payments, aggregating in excess of $9,600, made to a broker-dealer, which distributed shares of the REITs. The expenses associated with these payments, which were made during the period from early 2000 through the end of 2003, were borne by and accounted for on the books and records of the REITs. Of these payments, CPA^®:10 paid in excess of $40; CIP^® paid in excess of $875; CPA^®:12 paid in excess of $2,455; CPA^®:14 paid in excess of $4,990; and CPA^®:15 paid in excess of $1,240. In addition, other smaller payments by the REITs to the same and other broker-dealers have been identified aggregating less than $1,000.

The advisor and Carey Financial are cooperating fully with this investigation and have provided information to the Enforcement Staff in response to the subpoenas and requests. Although no formal regulatory action has been initiated against the advisor or Carey Financial in connection with the matters being investigated, we expect the SEC may pursue an action against either or both. The nature of the relief or remedies the SEC may seek cannot be predicted at this time. If an action is brought, it could have a material adverse effect on the advisor and Carey Financial and the magnitude of that effect would not necessarily be limited to the payments described above but could include other payments and civil monetary penalties. Any action brought against the advisor or Carey Financial could also have a material adverse effect on us because of our dependence on the advisor and Carey Financial for a broad range of services.

Several state securities regulators have sought information from Carey Financial relating to the matters described above. While one or more states may commence proceedings against Carey Financial in connection with these inquiries, we do not currently expect that these inquiries or proceedings will have a material effect on the advisor or Carey Financial incremental to that caused by any SEC action.

We are liable for certain expenses of the offering described in our prospectus, including filing, legal, accounting, printing and escrow fees, which are to be deducted from the gross proceeds of the offering. We will reimburse Carey Financial or one of its affiliates for expenses (including fees and expenses of its counsel) and for the costs of any sales and information meetings of Carey Financial’s registered representatives or employees of one of its affiliates relating to the offering. The total underwriting compensation to Carey

CPA^®:17 – Global 9/30/2007 10-Q — 8

Notes to Financial Statements

Financial and other dealers in connection with the offering shall not exceed 10% of the gross proceeds of the offering. The advisor has agreed to be responsible for the repayment of (i) organization and offering expenses which exceed 4% of the gross proceeds of the offering. The total costs paid by Carey Financial and its affiliates in connection with our offering were $1,597,797 through September 30, 2007, none of which has been reimbursed. Unpaid costs are included in due to affiliates in the financial statements.

Note 5. Subsequent Events

On November 9, 2007 our board of directors approved a distribution of $.001495 per share for each day during the period an investor was a stockholder of record from and including November 9, 2007 through December 31, 2007, payable on January 15, 2008.

In November 2007, our articles of incorporation were amended to increase the number of common shares authorized to 450,000,000 consisting of 400,000,000 shares of common stock, $.001 par value per share and 50,000,000 shares of preferred stock, $.001 par value per share.

CPA^®:17 – Global 9/30/2007 10-Q — 9

ITEM 2. — MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of financial condition and results of operations should be read in conjunction with the financial statements and notes thereto as of September 30, 2007.

Business Overview

We were formed in February 2007 for the purpose of investing in a diversified portfolio of income-producing commercial properties and other real estate related assets, both domestically and outside the United States. We intend to qualify as a real estate investment trust (“REIT”) and intend to conduct substantially all of our investment activities and own all of our assets through CPA:17 Limited Partnership, our operating partnership. We will be a general partner and a limited partner and will initially own a 99.985% capital interest in the operating partnership. W. P. Carey Holdings, LLC, a subsidiary of W. P. Carey & Co. LLC (“W. P. Carey”), will hold a special general partner interest in the operating partnership.

Carey Asset Management Corp., a subsidiary of W. P. Carey, is our advisor and will manage our business. The advisor also currently manages three other affiliated Corporate Property Associates REITs.

Significant Developments

Public Offering — On November 2, 2007, our registration statement on Form S-11 (File No. 333-140842), covering an initial public offering of up to 200,000,000 shares of common stock at $10.00 per share was declared effective under the Securities Act of 1933. The registration statement also covers the offering of up to 50,000,000 shares of common stock at $9.50 per share pursuant to our distribution reinvestment and stock purchase plan. Our initial public offering is being offered on a “best efforts” basis by Carey Financial, LLC, an affiliate of the advisor, and selected other dealers.

In November 2007, our articles of incorporation were amended to increase the number of common shares authorized to 450,000,000 consisting of 400,000,000 shares of common stock, $.001 par value per share and 50,000,000 shares of preferred stock, $.001 par value per share.

We intend to use the net proceeds of the offering to acquire, own and manage a portfolio of commercial properties leased to a diversified group of companies primarily on a single tenant net lease basis.

Distribution — On November 9, 2007 our board of directors approved a distribution of $.001495 per share for each day during the period an investor was a stockholder of record from and including November 9, 2007 through December 31, 2007, payable on January 15, 2008.

Results of Operations

We are a newly formed company and have no operating history. We are dependent upon proceeds received from the offering to conduct our proposed activities. The capital required to make investments will be obtained from the offering and from any mortgage indebtedness that we may incur in connection with our investment activity. We have initially been capitalized with $200,000 from the sale of 22,222 shares to W. P. Carey. We currently have no commitments to acquire any property or to make any other material capital expenditures.

Financial Condition

Liquidity would be affected adversely by unanticipated costs and greater-than-anticipated operating expenses. To the extent that our working capital reserve is insufficient to satisfy our cash requirements, additional funds may be provided from cash generated from operations or through short-term borrowings. In addition, subject to limitations described in our prospectus, we may incur indebtedness in connection with the acquisition of any property, refinance the debt thereon, arrange for the leveraging of any previously unfinanced property or reinvest the proceeds of financings or refinancings in additional properties.

If we qualify as a REIT, we will not be subject to federal income taxes on amounts distributed to stockholders provided we meet certain conditions including distributing at least 90% of our REIT taxable income to stockholders. Our objectives are to pay quarterly distributions at an increasing rate, to increase equity in our real estate through regular mortgage principal payments and to own a diversified portfolio of net-leased real estate and other real estate related assets that will increase in value.

CPA^®:17 – Global 9/30/2007 10-Q — 10

ITEM 3. — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We currently have limited exposure to financial market risks, including changes in interest rates. We currently have no foreign operations and are not exposed to foreign currency fluctuations.

Item 4T. — Controls and Procedures

Disclosure Controls and Procedures

Our disclosure controls and procedures include our controls and other procedures designed to provide reasonable assurance that information required to be disclosed in this and other reports filed under the Securities Exchange Act of 1934, as amended (“Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our chief executive officer and acting chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Our management, with the participation of our chief executive officer and acting chief financial officer, has conducted a review of our disclosure controls and procedures as of September 30, 2007. Based upon this review, our chief executive officer and acting chief financial officer have concluded that our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) were effective as of September 30, 2007.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II

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

As of the date of this Form 10-Q, W. P. Carey owns 22,222 shares of our common stock and is the sole stockholder. Since none of these transactions were considered to have involved a “public offering” within the meaning of Section 4(2) of the Securities Act, as amended, the shares issued were deemed to be exempt from registration. In acquiring our shares, W. P. Carey represented that such interests were being acquired by it for the purposes of investment and not with a view to the distribution thereof.

Our registration statement on Form S-11 (File No. 333-140842) was declared effective on November 2, 2007. The offering of our shares has not commenced because we are in the process of arranging the distribution of our shares through selected dealers.

Item 6. — Exhibits

Exhibit No.	Description	Method of Filing
3.1	Articles of Amendment and Restatement of Corporate Property Associates 17 – Global Incorporated	Filed herewith
3.2	Bylaws of Corporate Property Associates 17 – Global Incorporated	Filed herewith
4.1	Distribution Reinvestment and Stock Purchase Plan	Filed herewith
10.1	Advisory Agreement dated November 12, 2007 between Corporate Property Associates 17 – Global Incorporated and Carey Asset Management Corp.	Filed herewith
10.2	Agreement of Limited Partnership of CPA:17 Limited Partnership	Filed herewith
10.3	Sales Agency Agreement dated November 30, 2007 between Corporate Property Associates 17 – Global Incorporated and Carey Financial, LLC	Filed herewith
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Filed herewith
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Filed herewith
32	Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Filed herewith

CPA^®:17 – Global 9/30/2007 10-Q — 11

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

		Corporate Property Associates 17 – Global Incorporated
Date 12/14/2007	By:	/s/ Mark J. DeCesaris
		Mark J. DeCesaris
		Managing Director and acting Chief Financial Officer (acting Principal Financial Officer)
Date 12/14/2007	By:	/s/ Thomas Ridings
		Thomas Ridings
		Executive Director and Chief Accounting Officer (Principal Accounting Officer)

CPA^®:17 – Global 9/30/2007 10-Q — 12

EX-3.1

                                                                     EXHIBIT 3.1

             CORPORATE PROPERTY ASSOCIATES 17 - GLOBAL INCORPORATED

                      ARTICLES OF AMENDMENT AND RESTATEMENT

     FIRST: CORPORATE PROPERTY ASSOCIATES 17 - GLOBAL INCORPORATED, a Maryland
corporation (the "Corporation"), desires to amend and restate its charter as
currently in effect and as hereinafter amended.

     SECOND: The following provisions are all the provisions of the charter
currently in effect and as hereinafter amended:

                                    ARTICLE I

                                      NAME

     The name of the corporation (which is hereinafter called the "Corporation")
is:

             CORPORATE PROPERTY ASSOCIATES 17 - GLOBAL INCORPORATED

                                   ARTICLE II

                               PURPOSES AND POWERS

     The purposes for which the Corporation is formed are to engage in any
lawful act or activity (including, without limitation or obligation, engaging in
business as a real estate investment trust under the Internal Revenue Code of
1986, as amended, or any successor statute (the "Code")) for which corporations
may be organized under the general laws of the State of Maryland as now or
hereafter in force. For purposes of these Articles, "REIT" means a real estate
investment trust under Sections 856 through 860 of the Code.

                                   ARTICLE III

                  PRINCIPAL OFFICE IN STATE AND RESIDENT AGENT

     The address of the principal office of the Corporation in the State of
Maryland is c/o LSC - Lawyers Incorporating Service Company, 7 Saint Paul
Street, Baltimore, Maryland 21202. The name and address of the resident agent of
the Corporation are LSC -- Lawyers Incorporating Service Company, 7 Saint Paul
Street, Baltimore, Maryland 21202. The resident agent is a Maryland corporation.

                                   ARTICLE IV

                                   DEFINITIONS

     As used in the Charter, the following terms shall have the following
meanings unless the context otherwise requires:

     Acquisition Expenses. The term "Acquisition Expenses" shall mean, to the
extent not paid or to be paid by the seller, lessee, borrower or any other party
involved in the transaction, those expenses, including but not limited to legal
fees and expenses, travel and communications expenses, costs of



appraisals, nonrefundable option payments on Investments not acquired,
accounting fees and expenses, title insurance, and miscellaneous expenses
related to selection and acquisition of Investments, whether or not a particular
Investment ultimately is made. Acquisition Expenses shall not include
Acquisition Fees.

     Acquisition Fee. The term "Acquisition Fee" shall mean the total of all
fees and commissions (including any interest thereon) paid by the Corporation or
its subsidiaries to any party in connection with the making of Investments or
the purchase, development or construction of Properties. A Development Fee or
Construction Fee paid to a Person not affiliated with the Sponsor in connection
with the actual development or construction of a project after acquisition of
the Property by the Corporation shall not be deemed an Acquisition Fee. Included
in the computation of such fees or commissions shall be any real estate
commission, selection fee, development fee or construction fee (other than as
described above), non-recurring management fees, loan fees, points or any fee of
a similar nature, however designated. Acquisition Fees shall include
Subordinated Acquisition Fees, unless the context otherwise requires.
Acquisition Fees shall not include Acquisition Expenses.

     Adjusted Net Income. The term "Adjusted Net Income" shall mean for any
period, the total consolidated revenues recognized in such period by the
Corporation, less the total consolidated expenses of the Corporation recognized
in such period, excluding additions to reserves for depreciation and
amortization, bad debts or other similar non-cash reserves; provided, however,
that Adjusted Net Income for purposes of calculating total allowable Operating
Expenses shall exclude any gain, losses or writedowns from the sale of the
Corporation's assets.

     Advisor or Advisors. The term "Advisor" or "Advisors" shall mean the Person
or Persons, if any, appointed, employed or contracted with by the Corporation
pursuant to Section 8.1 hereof and responsible for directing or performing the
day-to-day business affairs of the Corporation, including any Person to whom the
Advisor subcontracts all or substantially all of such functions.

     Advisory Agreement. The term "Advisory Agreement" shall mean the agreement
between the Corporation and the Advisor pursuant to which the Advisor will
direct or perform the day-to-day business affairs of the Corporation.

     Affiliate or Affiliated. The term "Affiliate" or "Affiliated" shall mean,
with respect to any Person, (i) any Person directly or indirectly owning,
controlling or holding, with the power to vote, ten percent or more of the
outstanding voting securities of such other Person; (ii) any Person ten percent
or more of whose outstanding voting securities are directly or indirectly owned,
controlled or held, with the power to vote, by such other Person; (iii) any
Person directly or indirectly controlling, controlled by or under common control
with such other Person; (iv) any executive officer, director, trustee or general
partner of such other Person; and (v) any legal entity for which such Person
acts as an executive officer, director, trustee or general partner.

     Aggregate Share Ownership Limit. The term "Aggregate Share Ownership Limit"
shall mean not more than 9.8% in value of the aggregate of the outstanding
Shares.

     Appraised Value. The term "Appraised Value" shall mean value according to
an appraisal made by an Independent Appraiser, which may take into consideration
any factor deemed appropriate by such Independent Appraiser, including, but not
limited to, the terms and conditions of any lease of a relevant property, the
quality of any lessee's, borrower's or other counter-party's credit and the
conditions of the credit markets. The Appraised Value of a Property may be
greater than the construction cost or the replacement cost of the Property.


                                      -2-



     Average Invested Assets. The term "Average Invested Assets" shall mean the
average during any period of the aggregate book value of the Corporation's
Investments, before deducting reserves for depreciation, bad debts, impairments,
amortization and all other non-cash reserves, computed by taking the average of
such values at the end of each month during such period.

     Beneficial Ownership. The term "Beneficial Ownership" shall mean ownership
of Shares by a Person, whether the interest in Shares is held directly or
indirectly (including by a nominee), and shall include interests that would be
treated as owned through the application of Section 544 of the Code, as modified
by Section 856(h)(1)(B) of the Code. The terms "Beneficial Owner," "Beneficially
Owns" and "Beneficially Owned" shall have the correlative meanings.

     Board or Board of Directors. The term "Board" or "Board of Directors" shall
mean the Board of Directors of the Corporation.

     Business Day. The term "Business Day" shall mean any day, other than a
Saturday or Sunday, that is neither a legal holiday nor a day on which banking
institutions in New York City are authorized or required by law, regulation or
executive order to close.

     Bylaws. The term "Bylaws" shall mean the Bylaws of the Corporation, as
amended from time to time.

     Charitable Beneficiary. The term "Charitable Beneficiary" shall mean one or
more beneficiaries of the Charitable Trust as determined pursuant to Section
6.2.6, provided that each such organization must be described in Section
501(c)(3) of the Code and contributions to each such organization must be
eligible for deduction under each of Sections 170(b)(1)(A), 2055 and 2522 of the
Code.

     Charitable Trust. The term "Charitable Trust" shall mean any trust provided
for in Section 6.2.1.

     Charitable Trustee. The term "Charitable Trustee" shall mean the Person
unaffiliated with the Corporation and a Prohibited Owner, that is appointed by
the Corporation to serve as Trustee of the Charitable Trust.

     Charter. The term "Charter" shall mean the charter of the Corporation.

     Code. The term "Code" shall have the meaning as provided in Article II
herein.

     Commencement of the Initial Public Offering. The term "Commencement of the
Initial Public Offering" shall mean the date that the Securities and Exchange
Commission declares effective the registration statement filed under the
Securities Act for the Initial Public Offering.

     Common Share Ownership Limit. The term "Common Share Ownership Limit" shall
mean not more than 9.8% (in value or in number of Shares, whichever is more
restrictive) of the aggregate of the outstanding Common Shares.

     Common Shares. The term "Common Shares" shall have the meaning as provided
in Section 5.1 herein.

     Competitive Real Estate Commission. The term "Competitive Real Estate
Commission" shall mean a real estate or brokerage commission paid for the
purchase or sale of a Property that is reasonable, customary and competitive in
light of the size, type and location of the Property.


                                      -3-



     Construction Fee. The term "Construction Fee" shall mean a fee or other
remuneration for acting as general contractor and/or construction manager to
construct improvements, supervise and coordinate projects or to provide major
repairs or rehabilitations on a Property.

     Constructive Ownership. The term "Constructive Ownership" shall mean
ownership of Shares by a Person, whether the interest in Shares is held directly
or indirectly (including by a nominee), and shall include interests that would
be treated as owned through the application of Section 318(a) of the Code, as
modified by Section 856(d)(5) of the Code. The terms "Constructive Owner,"
"Constructively Owns" and "Constructively Owned" shall have the correlative
meanings.

     Contract Purchase Price. The term "Contract Purchase Price" shall mean the
amount actually paid or allocated (as of the date of purchase) to the purchase,
development, construction or improvement of an Investment or, in the case of an
originated Loan, the principal amount of such Loan, in each case exclusive of
Acquisition Fees and Acquisition Expenses.

     Contract Sales Price. The term "Contract Sales Price" shall mean the total
consideration received by the Corporation for the sale of a Property.

     Corporation. The term "Corporation" shall have the meaning as provided in
Article I herein.

     Development Fee. The term "Development Fee" shall mean a fee for the
packaging of a Property, including the negotiation and approval of plans, and
any assistance in obtaining zoning and necessary variances and financing for a
specific Property, either initially or at a later date.

     Director. The term "Director" shall have the meaning as provided in Section
7.1 herein.

     Distributions. The term "Distributions" shall mean any distributions of
money or other property, pursuant to Section 5.5 hereof, by the Corporation to
owners of Shares, including distributions that may constitute a return of
capital for federal income tax purposes.

     Excepted Holder. The term "Excepted Holder" shall mean a Stockholder for
whom an Excepted Holder Limit is created by this Article VI or by the Board of
Directors pursuant to Section 6.1.7.

     Excepted Holder Limit. The term "Excepted Holder Limit" shall mean,
provided that the affected Excepted Holder agrees to comply with the
requirements established by the Board of Directors pursuant to Section 6.1.7 and
subject to adjustment pursuant to Section 6.1.8, the percentage limit
established by the Board of Directors pursuant to Section 6.1.7.

     Excess Amount. The term "Excess Amount" shall have the meaning as provided
in Section 8.10 herein.

     Gross Proceeds. The term "Gross Proceeds" shall mean the aggregate purchase
price of all Shares sold for the account of the Corporation through an Offering,
without deduction for selling commissions, volume discounts, any marketing
support and due diligence expense reimbursement or Organization and Offering
Expenses in any Offering.

     Indemnitee. The term "Indemnitee" shall have the meaning as provided in
Section 12.2.1(b) herein.

     Independent Appraiser. The term "Independent Appraiser" shall mean a
qualified appraiser of real estate as determined by the Board, who has no
material current or prior business or personal


                                      -4-



relationship with the Corporation, the Advisor, the Directors or their
respective Affiliates. Membership in a nationally recognized appraisal society
such as the American Institute of Real Estate Appraisers or the Society of Real
Estate Appraisers shall be conclusive evidence of such qualification.

     Independent Director. The term "Independent Director" shall mean a Director
who is not on the date of determination, and within the last two years from the
date of determination has not been, directly or indirectly associated with the
Sponsor or the Advisor by virtue of (i) ownership of an interest in the Sponsor,
the Advisor or any of their Affiliates, other than the Corporation, (ii)
employment by the Sponsor, the Advisor or any of their Affiliates, (iii) service
as an officer or director of the Sponsor, the Advisor or any of their
Affiliates, other than as a Director of the Corporation, (iv) performance of
services, other than as a Director, for the Corporation, (v) service as a
director or trustee of more than three real estate investment trusts organized
by the Sponsor or advised by the Advisor, or (vi) maintenance of a material
business or professional relationship with the Sponsor, the Advisor or any of
their Affiliates. A business or professional relationship is considered
"material" per se if the aggregate gross revenue derived by the Director from
the Sponsor, the Advisor and their Affiliates exceeds five percent of either the
Director's annual gross revenue during either of the last two years or the
Director's net worth on a fair market value basis. In addition, (x) a Director's
ownership of Shares or of shares of stock of another REIT organized by the
Sponsor or advised by the Advisor for which the Director has served or is
serving as a member of the board of directors and (y) indirect ownership of an
immaterial amount of stock of the Sponsor (for example, through ownership of a
widely diversified mutual fund) shall be deemed not to be an interest prohibited
by clause (i) of this definition. An indirect association with the Sponsor or
the Advisor shall include circumstances in which a Director's spouse, parent,
child, sibling, mother- or father-in-law, son- or daughter-in-law or brother- or
sister-in-law is or has been associated with the Sponsor, the Advisor, any of
their Affiliates or the Corporation.

     Initial Date. The term "Initial Date" shall mean the date on which Shares
are first issued in the Corporation's first Offering.

     Initial Investment. The term "Initial Investment" shall mean that portion
of the initial capitalization of the Corporation contributed by the Sponsor or
its Affiliates pursuant to Section II.A. of the NASAA REIT Guidelines.

     Initial Public Offering. The term "Initial Public Offering" shall mean the
first Offering pursuant to an effective registration statement filed under the
Securities Act.

     Investment. The term "Investment" shall mean an investment made by the
Corporation in a Property, Loan or other asset that is consistent with the
investment objectives and policies of the Corporation.

     Joint Ventures. The term "Joint Ventures" shall mean those joint venture or
partnership arrangements in which the Corporation or any of its subsidiaries is
a co-venturer or general partner established to acquire or hold Investments.

     Leverage. The term "Leverage" shall mean the aggregate amount of
indebtedness of the Corporation for money borrowed (including purchase money
mortgage loans) outstanding at any time, both secured and unsecured.

     Listing. The term "Listing" shall mean the listing of the Common Shares on
a national securities exchange, the quotation of the Common Shares by The Nasdaq
Stock Market ("Nasdaq") or the trading of the Common Shares in the
over-the-counter market. Upon such Listing, the Common Shares shall be deemed
Listed.


                                      -5-



     Loans. The term "Loans" shall mean the notes and other evidences of
indebtedness or obligations acquired or entered into, directly or indirectly, by
the Corporation as lender, noteholder, participant, note purchaser or other
capacity, including but not limited to first or subordinate mortgage loans,
construction loans, development loans, loan participation, B notes, loans
secured by capital stock or any other assets or form of equity interest and any
other type of loan or financial arrangement, such as providing or arranging for
letters of credit, providing guarantees of obligations to third parties, or
providing commitments for loans. The term "Loans" shall not include leases which
are not recognized as leases for Federal income tax reporting purposes.

     Market Price. The term "Market Price" on any date shall mean, with respect
to any class or series of outstanding Shares, the Closing Price for such Shares
on such date. The "Closing Price" on any date shall mean the last sale price for
such Shares, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, for such Shares, in
either case as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the NYSE or,
if such Shares are not listed or admitted to trading on the NYSE, as reported on
the principal consolidated transaction reporting system with respect to
securities listed on the principal national securities exchange on which such
Shares are listed or admitted to trading or, if such Shares are not listed or
admitted to trading on any national securities exchange, the last quoted price,
or, if not so quoted, the average of the high bid and low asked prices in the
over-the-counter market, as reported by the National Association of Securities
Dealers, Inc. Automated Quotation System or, if such system is no longer in use,
the principal other automated quotation system that may then be in use or, if
such Shares are not quoted by any such organization, the average of the closing
bid and asked prices as furnished by a professional market maker making a market
in such Shares selected by the Board of Directors or, in the event that no
trading price is available for such Shares, the fair market value of Shares, as
determined in good faith by the Board of Directors.

     MGCL. The term "MGCL" shall mean the Maryland General Corporation Law, as
amended from time to time.

     NASAA REIT Guidelines. The term "NASAA REIT Guidelines" shall mean the
Statement of Policy Regarding Real Estate Investment Trusts published by the
North American Securities Administrators Association on September 29, 1993 and
in effect on the Initial Date.

     Net Assets. The term "Net Assets" shall mean the total assets of the
Corporation (other than intangibles) valued at cost, before deducting
depreciation, reserves for bad debts or other non-cash reserves, less total
liabilities, calculated quarterly by the Corporation on a basis consistently
applied.

     NYSE. The term "NYSE" shall mean the New York Stock Exchange.

     Offering. The term "Offering" shall mean the offering of Shares pursuant to
a Prospectus.

     Operating Expenses. The term "Operating Expenses" shall mean all
consolidated operating, general and administrative expenses paid or incurred by
the Corporation, as determined under generally accepted accounting principles,
except the following (insofar as they would otherwise be considered operating,
general and administrative expenses under generally accepted accounting
principles): (i) interest and discounts and other cost of borrowed money; (ii)
taxes (including state, Federal and foreign income tax, property taxes and
assessments, franchise taxes and taxes of any other nature); (iii) expenses of
raising capital, including Organization and Offering Expenses, printing,
engraving, and other expenses, and taxes incurred in connection with the
issuance and distribution of the Corporation's Shares and Securities; (iv)
Acquisition Expenses, real estate commissions on resale of property and other
expenses connected with the acquisition, disposition, origination, ownership and
operation of


                                      -6-



Investments, including the costs of foreclosure, insurance premiums, legal
services, brokerage and sales commissions, and the maintenance, repair and
improvement of Property; (v) Acquisition Fees or Subordinated Disposition Fees
payable to the Advisor or any other party; (vi) distributions paid by the
Operating Partnership to the special general partner under the agreement of
limited partnership of the Operating Partnership in respect of gains realized on
dispositions of Investments; (vii) amounts paid to effect a redemption or
repurchase of the special general partner interest held by the special general
partner pursuant to the agreement of limited partnership of the Operating
Partnership; and (viii) non-cash items, such as depreciation, amortization,
depletion, and additions to reserves for depreciation, amortization, depletion,
losses and bad debts. Notwithstanding anything herein to the contrary, Operating
Expenses shall include asset management fees and any loan refinancing fee and,
solely for purposes of determining compliance with the 2%/25% Guidelines,
distributions of profits and cash flow made by the Operating Partnership to the
special general partner pursuant to the agreement of limited partnership of the
Operating Partnership, other than distributions described in clauses (vi) and
(vii) of this definition.

     Operating Partnership. The term "Operating Partnership" or "OP" shall mean
CPA:17 Limited Partnership, a Delaware limited partnership, through which the
Corporation may own Investments.

     Organization and Offering Expenses. The term "Organization and Offering
Expenses" shall mean those expenses payable by the Corporation and the OP in
connection with the formation, qualification and registration of the Corporation
and in marketing and distributing Shares including, but not limited to such
expenses as: (i) the preparation, printing, filing and delivery of registration
statements and prospectuses (including any amendments thereof or supplements
thereto) and the preparing and printing of contractual agreements between the
Corporation, the OP, sales agents and selected dealers (including copies
thereof); (ii) the preparing and printing of the Charter and Bylaws, other
solicitation material and related documents and the filing and/or recording of
such documents necessary to comply with the laws of the State of Maryland for
the formation of a corporation and thereafter for the continued good standing of
a corporation; (iii) the qualification or registration of the Shares under state
securities or "Blue Sky" laws; (iv) any escrow arrangements, including any
compensation to an escrow agent; (v) the filing fees payable to the United
States Securities and Exchange Commission and to the National Association of
Securities Dealers, Inc.; (vi) reimbursement for the reasonable and identifiable
out-of-pocket expenses of the sales agent and the selected dealers, including
the cost of their counsel; (vii) the fees of the Corporation's counsel; (viii)
all advertising expenses incurred in connection with an Offering, including the
cost of all sales literature and the costs related to investor and broker/dealer
sales and information meetings and marketing incentive programs; and (ix)
selling commissions selected dealer fees, marketing fees, incentive fees, due
diligence fees and wholesaling fees incurred in connection with the sale of the
Shares.

     Person. The term "Person" shall mean an individual, corporation,
partnership, estate, trust (including a trust qualified under Sections 401(a) or
501(c)(17) of the Code), a portion of a trust permanently set aside for or to be
used exclusively for the purposes described in Section 642(c) of the Code,
association, private foundation within the meaning of Section 509(a) of the
Code, joint stock company or other entity and also includes a group as that term
is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934,
as amended, and a group to which an Excepted Holder Limit applies.

     Preferred Shares. The term "Preferred Shares" shall have the meaning as
provided in Section 5.1 herein.

     Prohibited Owner. The term "Prohibited Owner" shall mean, with respect to
any purported Transfer, any Person who, but for the provisions of Section 6.1.1,
would Beneficially Own or


                                      -7-



Constructively Own Shares, and if appropriate in the context, shall also mean
any Person who would have been the record owner of Shares that the Prohibited
Owner would have so owned.

     Property or Properties. The term "Property" or "Properties" shall mean, as
the context requires, the Corporation's entire interest in real property
(including leasehold interests) and personal or mixed property connected
therewith. A definitive arrangement which obligates the Corporation to acquire a
Property shall be treated as a Property.

     Prospectus. The term "Prospectus" shall mean the same as that term is
defined in Section 2(10) of the Securities Act, including a preliminary
prospectus, an offering circular as described in Rule 256 of the General Rules
and Regulations under the Securities Act, or, in the case of an intrastate
offering, any document by whatever name known, utilized for the purpose of
offering and selling Securities to the public.

     Reinvestment Plan. The term "Reinvestment Plan" shall have the meaning as
provided in Section 5.10 herein.

     REIT. The term "REIT" shall mean a corporation, trust, association or other
legal entity (other than a real estate syndication) that is engaged primarily in
investing in equity interests in real estate (including fee ownership and
leasehold interests) or in loans secured by real estate or both as defined
pursuant to the REIT Provisions of the Code.

     REIT Provisions of the Code. The term "REIT Provisions of the Code" shall
mean Sections 856 through 860 of the Code and any successor or other provisions
of the Code relating to real estate investment trusts (including provisions as
to the attribution of ownership of beneficial interests therein) and the
regulations promulgated thereunder.

     Restriction Termination Date. The term "Restriction Termination Date" shall
mean the first day after the Initial Date on which the Board of Directors
determines that it is no longer in the best interests of the Corporation to
attempt to, or continue to, qualify as a REIT or that compliance with the
restrictions and limitations on Beneficial Ownership, Constructive Ownership and
Transfers of Shares set forth herein is no longer required in order for the
Corporation to qualify as a REIT.

     Roll-Up Entity. The term "Roll-Up Entity" shall mean a partnership, real
estate investment trust, corporation, trust or similar entity that would be
created or would survive after the successful completion of a proposed Roll-Up
Transaction.

     Roll-Up Transaction. The term "Roll-Up Transaction" shall mean a
transaction involving the acquisition, merger, conversion or consolidation
either directly or indirectly of the Corporation and the issuance of securities
of a Roll-Up Entity to the Stockholders. Such term does not include:

     (a)  a transaction involving securities of the Corporation that have been
          for at least twelve months listed on a national securities exchange or
          traded through Nasdaq's National Market System; or

     (b)  a transaction involving the conversion to corporate, trust or
          association form of only the Corporation, if, as a consequence of the
          transaction, there will be no significant adverse change in any of the
          following:

          (i)  Stockholders' voting rights;


                                      -8-



          (ii) the term of existence of the Corporation;

          (iii) Sponsor or Advisor compensation; or

          (iv) the Corporation's investment objectives.

     SDAT. The term "SDAT" shall have the meaning as provided in Section 5.4
herein.

     Securities. The term "Securities" shall mean any of the following issued by
the Corporation, as the text requires: Shares, any other stock, shares or other
evidences of equity or beneficial or other interests, voting trust certificates,
bonds, debentures, notes or other evidences of indebtedness, secured or
unsecured, convertible, subordinated or otherwise, or in general any instruments
commonly known as "securities" or any certificates of interest, shares or
participations in, temporary or interim certificates for, receipts for,
guarantees of, or warrants, options or rights to subscribe to, purchase or
acquire, any of the foregoing.

     Securities Act. The term "Securities Act" shall mean the Securities Act of
1933, as amended from time to time, or any successor statute thereto. Reference
to any provision of the Securities Act shall mean such provision as in effect
from time to time, as the same may be amended, and any successor provision
thereto, as interpreted by any applicable regulations as in effect from time to
time.

     Shares. The term "Shares" shall mean shares of stock of the Corporation of
any class or series, including Common Shares or Preferred Shares.

     Sponsor. The term "Sponsor" shall mean any Person which (i) is directly or
indirectly instrumental in organizing, wholly or in part, the Corporation, (ii)
will control, manage or participate in the management of the Corporation, and
any Affiliate of any such Person, (iii) takes the initiative, directly or
indirectly, in founding or organizing the Corporation, either alone or in
conjunction with one or more other Persons, (iv) receives a material
participation in the Corporation in connection with the founding or organizing
of the business of the Corporation, in consideration of services or property, or
both services and property, (v) has a substantial number of relationships and
contacts with the Corporation, (vi) possesses significant rights to control
Properties, (vii) receives fees for providing services to the Corporation which
are paid on a basis that is not customary in the industry, or (viii) provides
goods or services to the Corporation on a basis which was not negotiated at
arm's-length with the Corporation. "Sponsor" does not include any Person whose
only relationship with the Corporation is that of an independent property
manager and whose only compensation is as such, or wholly independent third
parties such as attorneys, accountants and underwriters whose only compensation
is for professional services.

     Stockholder List. The term "Stockholder List" shall have the meaning as
provided in Section 11.5 herein.

     Stockholders. The term "Stockholders" shall mean the holders of record of
the Shares as maintained in the books and records of the Corporation or its
transfer agent.

     Subordinated Acquisition Fee. The term "Subordinated Acquisition Fee" shall
mean the subordinated fee payable to the Advisor or an Affiliate under the
Advisory Agreement for property acquisition services.


                                      -9-



     Subordinated Disposition Fee. The term "Subordinated Disposition Fee" shall
mean the subordinated fee paid to the Advisor or an Affiliate under the Advisory
Agreement for property disposition services.

     Termination Date. The term "Termination Date" shall mean the date of
termination of the Advisory Agreement.

     Total Investment Cost. The term "Total Investment Cost" with regard to any
Investment shall mean, an amount equal to the sum of the Contract Purchase Price
of such Investment plus the Acquisition Fees and Acquisition Expenses paid in
connection with such Investment.

     Transfer. The term "Transfer" shall mean any issuance, sale, transfer,
gift, assignment, devise or other disposition, as well as any other event that
causes any Person to acquire Beneficial Ownership or Constructive Ownership, or
any agreement to take any such actions or cause any such events, of Shares or
the right to vote or receive dividends on Shares, including (a) the granting or
exercise of any option (or any disposition of any option), (b) any disposition
of any securities or rights convertible into or exchangeable for Shares or any
interest in Shares or any exercise of any such conversion or exchange right and
(c) Transfers of interests in other entities that result in changes in
Beneficial or Constructive Ownership of Shares; in each case, whether voluntary
or involuntary, whether owned of record, Constructively Owned or Beneficially
Owned and whether by operation of law or otherwise. The terms "Transferring" and
"Transferred" shall have the correlative meanings.

     2%/25% Guidelines. The term "2%/25% Guidelines" shall have the meaning as
provided in Section 8.9 herein.

     Unimproved Real Property. The term "Unimproved Real Property" shall mean
Property in which the Corporation has an equity interest that was not acquired
for the purpose of producing rental or other operating income, that has no
development or construction in process and for which no development or
construction is planned, in good faith, to commence within one year.

                                    ARTICLE V

                                      STOCK

     Section 5.1 Authorized Shares. The Corporation has authority to issue
450,000,000 Shares, consisting of 400,000,000 shares of Common Stock, $.001 par
value per share ("Common Shares"), and 50,000,000 shares of Preferred Stock,
$.001 par value per share ("Preferred Shares"). The aggregate par value of all
authorized Shares having par value is $450,000.00. All Shares shall be fully
paid and nonassessable when issued. If Shares of one class are classified or
reclassified into Shares of another class pursuant to this Article V, the number
of authorized Shares of the former class shall be automatically decreased and
the number of Shares of the latter class shall be automatically increased, in
each case by the number of Shares so classified or reclassified, so that the
aggregate number of Shares of all classes that the Corporation has authority to
issue shall not be more than the total number of Shares set forth in the first
sentence of this paragraph. The Board of Directors, with the approval of a
majority of the entire Board and without any action by the Stockholders, may
amend the Charter from time to time to increase or decrease the aggregate number
of Shares or the number of Shares of any class or series that the Corporation
has authority to issue.


                                      -10-



Section 5.2 Common Shares.

          Section 5.2.1 Common Shares Subject to Terms of Preferred Shares. The
     Common Shares shall be subject to the express terms of any series of
     Preferred Shares.

          Section 5.2.2 Description. Subject to the provisions of Article VI and
     except as may otherwise be specified in the terms of any class or series of
     Common Shares, each Common Share shall entitle the holder thereof to one
     vote per share on all matters upon which Stockholders are entitled to vote
     pursuant to Section 11.2 hereof. The Board may classify or reclassify any
     unissued Common Shares from time to time in one or more classes or series
     of Shares; provided, however, that the voting rights per Share (other than
     any publicly held Share) sold in a private offering shall not exceed the
     voting rights which bear the same relationship to the voting rights of a
     publicly held Share as the consideration paid to the Corporation for each
     privately offered Share bears to the book value of each outstanding
     publicly held Share.

          Section 5.2.3 Rights Upon Liquidation. In the event of any voluntary
     or involuntary liquidation, dissolution or winding up, or any distribution
     of the assets of the Corporation, the aggregate assets available for
     distribution to holders of the Common Shares shall be determined in
     accordance with applicable law. Each holder of Common Shares of a
     particular class shall be entitled to receive, ratably with each other
     holder of Common Shares of such class, that portion of such aggregate
     assets available for distribution as the number of outstanding Common
     Shares of such class held by such holder bears to the total number of
     outstanding Common Shares of such class then outstanding.

          Section 5.2.4 Voting Rights. Except as may be provided otherwise in
     the Charter, and subject to the express terms of any series of Preferred
     Shares, the holders of the Common Shares shall have the exclusive right to
     vote on all matters (as to which a common stockholder shall be entitled to
     vote pursuant to applicable law) at all meetings of the Stockholders.

     Section 5.3 Preferred Shares. The Board may classify any unissued Preferred
Shares and reclassify any previously classified but unissued Preferred Shares of
any series from time to time, in one or more classes or series of Shares;
provided, however, that the voting rights per Share (other than any publicly
held Share) sold in a private offering shall not exceed the voting rights which
bear the same relationship to the voting rights of a publicly held Share as the
consideration paid to the Corporation for each privately offered Share bears to
the book value of each outstanding publicly held Share.

     Section 5.4 Classified or Reclassified Shares. Prior to issuance of
classified or reclassified Shares of any class or series, the Board by
resolution shall: (a) designate that class or series to distinguish it from all
other classes and series of Shares; (b) specify the number of Shares to be
included in the class or series; (c) set or change, subject to the provisions of
Article VI and subject to the express terms of any class or series of Shares
outstanding at the time, the preferences, conversion or other rights, voting
powers, restrictions, limitations as to dividends or other distributions,
qualifications and terms and conditions of redemption for each class or series;
and (d) cause the Corporation to file articles supplementary with the State
Department of Assessments and Taxation of Maryland ("SDAT"). Any of the terms of
any class or series of Shares set or changed pursuant to clause (c) of this
Section 5.4 may be made dependent upon facts or events ascertainable outside the
Charter (including determinations by the Board or other facts or events within
the control of the Corporation) and may vary among holders thereof, provided
that the manner in which such facts, events or variations shall operate upon the
terms of such class or series of Shares is clearly and expressly set forth in
the articles supplementary or other charter document.


                                      -11-



     Section 5.5 Dividends and Distributions. The Board of Directors may from
time to time authorize the Corporation to declare and pay to Stockholders such
dividends or Distributions, in cash or other assets of the Corporation or in
securities of the Corporation or from any other source as the Board of Directors
in its discretion shall determine. The Board of Directors shall endeavor to
authorize the Corporation to declare and pay such dividends and Distributions as
shall be necessary for the Corporation to qualify as a REIT under the Code so
long as such qualification, in the opinion of the Board of Directors, is in the
best interest of the Corporation; however, Stockholders shall have no right to
any dividend or Distribution unless and until authorized by the Board and
declared by the Corporation. The exercise of the powers and rights of the Board
of Directors pursuant to this Section 5.5 shall be subject to the provisions of
any class or series of Shares at the time outstanding. The receipt by any Person
in whose name any Shares are registered on the records of the Corporation or by
his or her duly authorized agent shall be a sufficient discharge for all
dividends or Distributions payable or deliverable in respect of such Shares and
from all liability to see to the application thereof. Distributions in kind
shall not be permitted, except for distributions of readily marketable
securities, distributions of beneficial interests in a liquidating trust
established for the dissolution of the Corporation and the liquidation of its
assets in accordance with the terms of the Charter or distributions in which (i)
the Board advises each Stockholder of the risks associated with direct ownership
of the property, (ii) the Board offers each Stockholder the election of
receiving such in-kind distributions, and (iii) in-kind distributions are made
only to those Stockholders that accept such offer.

     Section 5.6 Charter and Bylaws. The rights of all Stockholders and the
terms of all Shares are subject to the provisions of the Charter and the Bylaws.

     Section 5.7 No Issuance of Share Certificates. Until Listing, the
Corporation shall not issue stock certificates. A Stockholder's investment shall
be recorded on the books of the Corporation. To transfer his or her Shares, a
Stockholder shall submit an executed form to the Corporation, which form shall
be provided by the Corporation upon request. Such transfer will also be recorded
on the books of the Corporation. Upon issuance or transfer of Shares, the
Corporation will provide the Stockholder with information concerning his or her
rights with regard to such Shares, as required by the Bylaws and the MGCL or
other applicable law.

     Section 5.8 Suitability of Stockholders. Until Listing, the following
provisions shall apply:

          Section 5.8.1 Investor Suitability Standards. Subject to suitability
     standards established by individual states, to become a Stockholder in the
     Corporation, if such prospective Stockholder is an individual (including an
     individual beneficiary of a purchasing Individual Retirement Account), or
     if the prospective Stockholder is a fiduciary (such as a trustee of a trust
     or corporate pension or profit sharing plan, or other tax-exempt
     organization, or a custodian under a Uniform Gifts to Minors Act), such
     individual or fiduciary, as the case may be, must represent to the
     Corporation, among other requirements as the Corporation may require from
     time to time:

               (a) that such individual (or, in the case of a fiduciary, that
          the fiduciary account or the donor who directly or indirectly supplies
          the funds to purchase the Shares) has a minimum annual gross income of
          $70,000 and a net worth (excluding home, furnishings and automobiles)
          of not less than $70,000; or

               (b) that such individual (or, in the case of a fiduciary, that
          the fiduciary account or the donor who directly or indirectly supplies
          the funds to purchase the Shares) has a net worth (excluding home,
          furnishings and automobiles) of not less than $250,000.


                                      -12-



          Section 5.8.2 Determination of Suitability of Sale. Each Person
     selling Shares on behalf of the Corporation shall make every reasonable
     effort to determine that the purchase of Shares by Stockholders is a
     suitable and appropriate investment for such Stockholder. In making this
     determination, each Person selling Shares on behalf of the Corporation
     shall ascertain that the prospective Stockholder: (a) meets the minimum
     income and net worth standards established for the Corporation; (b) can
     reasonably benefit from the Corporation based on the prospective
     Stockholder's overall investment objectives and portfolio structure; (c) is
     able to bear the economic risk of the investment based on the prospective
     Stockholder's overall financial situation; and (d) has apparent
     understanding of (1) the fundamental risks of the investment; (2) the risk
     that the Stockholder may lose the entire investment; (3) the lack of
     liquidity of the Shares; (4) the restrictions on transferability of the
     Shares; and (5) the tax consequences of the investment.

          Each Person selling Shares on behalf of the Corporation shall make
     this determination on the basis of information it has obtained from a
     prospective Stockholder. Relevant information for this purpose will include
     at least the age, investment objectives, investment experiences, income,
     net worth, financial situation, and other investments of the prospective
     Stockholder, as well as any other pertinent factors.

          Each Person selling Shares on behalf of the Corporation shall maintain
     records of the information used to determine that an investment in Shares
     is suitable and appropriate for a Stockholder. Each Person selling Shares
     on behalf of the Corporation shall maintain these records for at least six
     years.

          Section 5.8.3 Minimum Investment and Transfer. Subject to certain
     individual state requirements and the issuance of Shares under the
     Reinvestment Plan, no initial sale or transfer of Shares will be permitted
     of less than $2,000.

     Section 5.9 Repurchase of Shares. The Board may establish, from time to
time, a program or programs by which the Corporation voluntarily repurchases
Shares from its Stockholders; provided, however, that such repurchase does not
impair the capital or operations of the Corporation. The Sponsor, Advisor,
members of the Board or any Affiliates thereof may not receive any fees arising
out of the repurchase of Shares by the Corporation.

     Section 5.10 Distribution Reinvestment Plans. The Board may establish, from
time to time, a Distribution reinvestment plan or plans (each, a "Reinvestment
Plan"). Under any such Reinvestment Plan, (i) all material information regarding
Distributions to the Stockholders and the effect of reinvesting such
Distributions, including the tax consequences thereof, shall be provided to the
Stockholders not less often than annually, and (ii) each Stockholder
participating in such Reinvestment Plan shall have a reasonable opportunity to
withdraw from the Reinvestment Plan not less often than annually after receipt
of the information required in clause (i) above.


                                      -13-



                                   ARTICLE VI

                 RESTRICTION ON TRANSFER AND OWNERSHIP OF SHARES

     Section 6.1 Shares.

          Section 6.1.1 Ownership Limitations. During the period commencing on
     the Initial Date and prior to the Restriction Termination Date, but subject
     to Section 6.3:

               (a) Basic Restrictions.

                    (i) (1) No Person, other than an Excepted Holder, shall
               Beneficially Own or Constructively Own Shares in excess of the
               Aggregate Share Ownership Limit, (2) no Person, other than an
               Excepted Holder, shall Beneficially Own or Constructively Own
               Common Shares in excess of the Common Share Ownership Limit and
               (3) no Excepted Holder shall Beneficially Own or Constructively
               Own Shares in excess of the Excepted Holder Limit for such
               Excepted Holder.

                    (ii) No Person shall Beneficially or Constructively Own
               Shares to the extent that such Beneficial or Constructive
               Ownership of Shares would result in the Corporation being
               "closely held" within the meaning of Section 856(h) of the Code
               (without regard to whether the ownership interest is held during
               the last half of a taxable year), or otherwise failing to qualify
               as a REIT (including, but not limited to, Beneficial or
               Constructive Ownership that would result in the Corporation
               owning (actually or Constructively) an interest in a tenant that
               is described in Section 856(d)(2)(B) of the Code if the income
               derived by the Corporation from such tenant would cause the
               Corporation to fail to satisfy any of the gross income
               requirements of Section 856(c) of the Code).

                    (iii) Any Transfer of Shares that, if effective, would
               result in Shares being beneficially owned by less than 100
               Persons (determined under the principles of Section 856(a)(5) of
               the Code) shall be void ab initio, and the intended transferee
               shall acquire no rights in such Shares.

               (b) Transfer in Trust. If any Transfer of Shares occurs which, if
          effective, would result in any Person Beneficially Owning or
          Constructively Owning Shares in violation of Section 6.1.1(a)(i) or
          (ii),

                    (i) then that number of Shares the Beneficial or
               Constructive Ownership of which otherwise would cause such Person
               to violate Section 6.1.1(a)(i) or (ii) (rounded up to the nearest
               whole share) shall be automatically transferred to a Charitable
               Trust for the benefit of a Charitable Beneficiary, as described
               in Section 6.2, effective as of the close of business on the
               Business Day prior to the date of such Transfer, and such Person
               shall acquire no rights in such Shares; or

                    (ii) if the transfer to the Charitable Trust described in
               clause (i) of this sentence would not be effective for any reason
               to prevent the violation of Section 6.1.1(a)(i) or (ii), then the
               Transfer of that number of Shares that otherwise would cause any
               Person to violate Section 6.1.1(a)(i) or (ii) shall be void ab
               initio, and the intended transferee shall acquire no rights in
               such Shares.


                                      -14-



          Section 6.1.2 Remedies for Breach. If the Board of Directors or its
     designee (including any duly authorized committee of the Board) shall at
     any time determine in good faith that a Transfer or other event has taken
     place that results in a violation of Section 6.1.1 or that a Person intends
     to acquire or has attempted to acquire Beneficial or Constructive Ownership
     of any Shares in violation of Section 6.1.1 (whether or not such violation
     is intended), the Board of Directors or its designee shall take such action
     as it deems advisable to refuse to give effect to or to prevent such
     Transfer or other event, including, without limitation, causing the
     Corporation to redeem Shares, refusing to give effect to such Transfer on
     the books of the Corporation or instituting proceedings to enjoin such
     Transfer or other event; provided, however, that any Transfers or attempted
     Transfers or other events in violation of Section 6.1.1 shall automatically
     result in the transfer to the Charitable Trust described above, and, where
     applicable, such Transfer (or other event) shall be void ab initio as
     provided above irrespective of any action (or non-action) by the Board of
     Directors or its designee.

          Section 6.1.3 Notice of Restricted Transfer. Any Person who acquires
     or attempts or intends to acquire Beneficial Ownership or Constructive
     Ownership of Shares that will or may violate Section 6.1.1(a), or any
     Person who would have owned Shares that resulted in a transfer to the
     Charitable Trust pursuant to the provisions of Section 6.1.1(b), shall
     immediately give written notice to the Corporation of such event, or in the
     case of such a proposed or attempted transaction, give at least 15 days'
     prior written notice, and shall provide to the Corporation such other
     information as the Corporation may request in order to determine the
     effect, if any, of such Transfer on the Corporation's status as a REIT.

          Section 6.1.4 Owners Required To Provide Information. From the Initial
     Date and prior to the Restriction Termination Date:

               (a) every owner of more than five percent (or such lower
          percentage as required by the Code or the Treasury Regulations
          promulgated thereunder) of the outstanding Shares, within 30 days
          after the end of each taxable year, shall give written notice to the
          Corporation stating the name and address of such owner, the number of
          Shares and other Shares Beneficially Owned and a description of the
          manner in which such Shares are held. Each such owner shall provide to
          the Corporation such additional information as the Corporation may
          request in order to determine the effect, if any, of such Beneficial
          Ownership on the Corporation's status as a REIT and to ensure
          compliance with the Aggregate Share Ownership Limit, the Common Share
          Ownership Limit and the other restrictions set forth herein.

               (b) each Person who is a Beneficial or Constructive Owner of
          Shares and each Person (including the stockholder of record) who is
          holding Shares for a Beneficial or Constructive Owner shall provide to
          the Corporation such information as the Corporation may request, in
          good faith, in order to determine the Corporation's status as a REIT
          and to comply with requirements of any taxing authority or
          governmental authority or to determine such compliance.

          Section 6.1.5 Remedies Not Limited. Subject to Section 7.10 of the
     Charter, nothing contained in this Section 6.1 shall limit the authority of
     the Board of Directors to take such other action as it deems necessary or
     advisable to protect the Corporation and the interests of its stockholders
     in preserving the Corporation's status as a REIT.

          Section 6.1.6 Ambiguity. In the case of an ambiguity in the
     application of any of the provisions of this Section 6.1, Section 6.2 or
     any definition contained in Article IV, the Board of


                                      -15-



     Directors shall have the power to determine the application of the
     provisions of this Section 6.1 or Section 6.2 with respect to any situation
     based on the facts known to it. In the event Section 6.1 or 6.2 requires an
     action by the Board of Directors and the Charter fails to provide specific
     guidance with respect to such action, the Board of Directors shall have the
     power to determine the action to be taken so long as such action is not
     contrary to the provisions of Article IV or Sections 6.1 or 6.2. Absent a
     decision to the contrary by the Board of Directors (which the Board may
     make in its sole and absolute discretion), if a Person would have (but for
     the remedies set forth in Section 6.1.2) acquired Beneficial or
     Constructive Ownership of Shares in violation of Section 6.1.1, such
     remedies (as applicable) shall apply first to the Shares which, but for
     such remedies, would have been Beneficially Owned or Constructively Owned
     (but not actually owned) by such Person, pro rata among the Persons who
     actually own such Shares based upon the relative number of the Shares held
     by each such Person.

          Section 6.1.7 Exceptions.

               (a) Subject to Section 6.1.1(a)(ii), the Board of Directors, in
          its sole discretion, may exempt (prospectively or retroactively) a
          Person from the Aggregate Share Ownership Limit and the Common Share
          Ownership Limit, as the case may be, and may establish or increase an
          Excepted Holder Limit for such Person if:

                    (i) the Board of Directors obtains such representations and
               undertakings from such Person as are reasonably necessary to
               ascertain that no individual's Beneficial or Constructive
               Ownership of such Shares will violate Section 6.1.1(a)(ii);

                    (ii) such Person does not and represents that it will not
               own, actually or Constructively, an interest in a tenant of the
               Corporation (or a tenant of any entity owned or controlled by the
               Corporation) that would cause the Corporation to own, actually or
               Constructively, more than a 9.9% interest (as set forth in
               Section 856(d)(2)(B) of the Code) in such tenant and the Board of
               Directors obtains such representations and undertakings from such
               Person as are reasonably necessary to ascertain this fact (for
               this purpose, a tenant from whom the Corporation (or an entity
               owned or controlled by the Corporation) derives (and is expected
               to continue to derive) a sufficiently small amount of revenue
               such that, in the opinion of the Board of Directors, rent from
               such tenant would not adversely affect the Corporation's ability
               to qualify as a REIT, shall not be treated as a tenant of the
               Corporation); and

                    (iii) such Person agrees that any violation or attempted
               violation of such representations or undertakings (or other
               action which is contrary to the restrictions contained in
               Sections 6.1.1 through 6.1.6) will result in such Shares being
               automatically transferred to a Charitable Trust in accordance
               with Sections 6.1.1(b) and 6.2.

               (b) Prior to granting any exception pursuant to Section 6.1.7(a),
          the Board of Directors may require a ruling from the Internal Revenue
          Service, or an opinion of counsel, in either case in form and
          substance satisfactory to the Board of Directors in its sole
          discretion, as it may deem necessary or advisable in order to
          determine or ensure the Corporation's status as a REIT.
          Notwithstanding the receipt of any ruling or opinion, the Board of
          Directors may impose such conditions or restrictions as it deems
          appropriate in connection with granting such exception.


                                      -16-



               (c) Subject to Section 6.1.1(a)(ii), an underwriter which
          participates in a public offering or a private placement of Shares (or
          securities convertible into or exchangeable for Shares) may
          Beneficially Own or Constructively Own Shares (or securities
          convertible into or exchangeable for Shares) in excess of the
          Aggregate Share Ownership Limit, the Common Share Ownership Limit or
          both such limits, but only to the extent necessary to facilitate such
          public offering or private placement.

               (d) The Board of Directors may only reduce the Excepted Holder
          Limit for an Excepted Holder: (1) with the written consent of such
          Excepted Holder at any time, or (2) pursuant to the terms and
          conditions of the agreements and undertakings entered into with such
          Excepted Holder in connection with the establishment of the Excepted
          Holder Limit for that Excepted Holder. No Excepted Holder Limit shall
          be reduced to a percentage that is less than the Common Share
          Ownership Limit.

          Section 6.1.8 Increase in Aggregate Share Ownership and Common Share
     Ownership Limits. Subject to Section 6.1.2(a)(ii), the Board of Directors
     may from time to time increase the Common Share Ownership Limit and the
     Aggregate Share Ownership Limit for one or more Persons and decrease the
     Common Share Ownership Limit and the Aggregate Share Ownership Limit for
     all other Persons; provided, however, that the decreased Common Share
     Ownership Limit and/or Aggregate Share Ownership Limit will not be
     effective for any Person whose percentage ownership in Shares is in excess
     of such decreased Common Share Ownership Limit and/or Aggregate Share
     Ownership Limit until such time as such Person's percentage of Share equals
     or falls below the decreased Common Share Ownership Limit and/or Aggregate
     Share Ownership Limit, but any further acquisition of Shares in excess of
     such percentage ownership of Shares will be in violation of the Common
     Share Ownership Limit and/or Aggregate Share Ownership Limit and, provided
     further, that the new Common Share Ownership Limit and/or Aggregate Share
     Ownership Limit would not allow five or fewer Persons to Beneficially Own
     more than 49.9% in value of the outstanding Shares.

          Section 6.1.9 Legend. Any certificate representing Shares shall bear
     substantially the following legend:

     The Shares represented by this certificate are subject to restrictions on
Beneficial and Constructive Ownership and Transfer for the purpose, among
others, of the Corporation's maintenance of its status as a Real Estate
Investment Trust (a "REIT") under the Internal Revenue Code of 1986, as amended
(the "Code"). Subject to certain further restrictions and except as expressly
provided in the Corporation's Charter, (i) no Person may Beneficially or
Constructively Own Common Shares of the Corporation in excess of 9.8% (in value
or number of Shares) of the outstanding Common Shares of the Corporation unless
such Person is an Excepted Holder (in which case the Excepted Holder Limit shall
be applicable); (ii) no Person may Beneficially or Constructively Own Shares of
the Corporation in excess of 9.8% of the value of the total outstanding Shares
of the Corporation, unless such Person is an Excepted Holder (in which case the
Excepted Holder Limit shall be applicable); (iii) no Person may Beneficially or
Constructively Own Shares that would result in the Corporation being "closely
held" under Section 856(h) of the Code or otherwise cause the Corporation to
fail to qualify as a REIT; and (iv) no Person may Transfer Shares if such
Transfer would result in Shares of the Corporation being owned by fewer than 100
Persons. Any Person who Beneficially or Constructively Owns or attempts to
Beneficially or Constructively Own Shares which cause or will cause a Person to
Beneficially or Constructively Own Shares in excess or in violation of the above
limitations must immediately notify the Corporation. If any of the restrictions
on transfer or ownership are violated, the Shares represented hereby will be
automatically transferred to a Charitable Trust for the benefit of one or more
Charitable Beneficiaries. In addition, the Corporation may redeem Shares upon
the terms and conditions specified


                                      -17-



by the Board of Directors in its sole discretion if the Board of Directors
determines that ownership or a Transfer or other event may violate the
restrictions described above. Furthermore, upon the occurrence of certain
events, attempted Transfers in violation of the restrictions described above may
be void ab initio. All capitalized terms in this legend have the meanings
defined in the Corporation's Charter, as the same may be amended from time to
time, a copy of which, including the restrictions on transfer and ownership,
will be furnished to each holder of Shares of the Corporation on request and
without charge. Requests for such a copy may be directed to the Secretary of the
Corporation at its principal office.

     Instead of the foregoing legend, the certificate may state that the
Corporation will furnish a full statement about certain restrictions on
transferability to a stockholder on request and without charge. In the case of
uncertificated Shares, the Corporation will send the holder of such Shares, on
request and without charge, a written statement of the information otherwise
required on certificates.

     Section 6.2 Transfer of Shares in Trust.

          Section 6.2.1 Ownership in Trust. Upon any purported Transfer or other
     event described in Section 6.1.1(b) that would result in a transfer of
     Shares to a Charitable Trust, such Shares shall be deemed to have been
     transferred to the Charitable Trustee as trustee of a Charitable Trust for
     the exclusive benefit of one or more Charitable Beneficiaries. Such
     transfer to the Charitable Trustee shall be deemed to be effective as of
     the close of business on the Business Day prior to the purported Transfer
     or other event that results in the transfer to the Charitable Trust
     pursuant to Section 6.1.1(b). The Charitable Trustee shall be appointed by
     the Corporation and shall be a Person unaffiliated with the Corporation and
     any Prohibited Owner. Each Charitable Beneficiary shall be designated by
     the Corporation as provided in Section 6.2.6.

          Section 6.2.2 Status of Shares Held by the Charitable Trustee. Shares
     held by the Charitable Trustee shall continue to be issued and outstanding
     Shares of the Corporation. The Prohibited Owner shall have no rights in the
     Shares held by the Charitable Trustee. The Prohibited Owner shall not
     benefit economically from ownership of any Shares held in trust by the
     Charitable Trustee, shall have no rights to dividends or other
     Distributions and shall not possess any rights to vote or other rights
     attributable to the Shares held in the Charitable Trust.

          Section 6.2.3 Dividend and Voting Rights. The Charitable Trustee shall
     have all voting rights and rights to dividends or other Distributions with
     respect to Shares held in the Charitable Trust, which rights shall be
     exercised for the exclusive benefit of the Charitable Beneficiary. Any
     dividend or other Distribution paid prior to the discovery by the
     Corporation that Shares have been transferred to the Charitable Trustee
     shall be paid with respect to such Shares to the Charitable Trustee upon
     demand and any dividend or other Distribution authorized but unpaid shall
     be paid when due to the Charitable Trustee. Any dividends or Distributions
     so paid over to the Charitable Trustee shall be held in trust for the
     Charitable Beneficiary. The Prohibited Owner shall have no voting rights
     with respect to Shares held in the Charitable Trust and, subject to
     Maryland law, effective as of the date that Shares have been transferred to
     the Charitable Trustee, the Charitable Trustee shall have the authority (at
     the Charitable Trustee's sole discretion) (i) to rescind as void any vote
     cast by a Prohibited Owner prior to the discovery by the Corporation that
     Shares have been transferred to the Charitable Trustee and (ii) to recast
     such vote in accordance with the desires of the Charitable Trustee acting
     for the benefit of the Charitable Beneficiary; provided, however, that if
     the Corporation has already taken irreversible corporate action, then the
     Charitable Trustee shall not have the authority to rescind and recast such
     vote. Notwithstanding the provisions of this Article VI, until the
     Corporation has received notification that Shares have been transferred
     into a Charitable Trust, the Corporation shall be entitled to rely on its
     share transfer and other stockholder records for purposes of preparing
     lists


                                      -18-



     of stockholders entitled to vote at meetings, determining the validity and
     authority of proxies and otherwise conducting votes of stockholders.

          Section 6.2.4 Sale of Shares by Charitable Trustee. Within 20 days of
     receiving notice from the Corporation that Shares have been transferred to
     the Charitable Trust, the Charitable Trustee shall sell the Shares held in
     the Charitable Trust to a person, designated by the Charitable Trustee,
     whose ownership of the Shares will not violate the ownership limitations
     set forth in Section 6.1.1(a). Upon such sale, the interest of the
     Charitable Beneficiary in the Shares sold shall terminate and the
     Charitable Trustee shall distribute the net proceeds of the sale to the
     Prohibited Owner and to the Charitable Beneficiary as provided in this
     Section 6.2.4. The Prohibited Owner shall receive the lesser of (1) the
     price paid by the Prohibited Owner for the Shares or, if the Prohibited
     Owner did not give value for the Shares in connection with the event
     causing the Shares to be held in the Charitable Trust (e.g., in the case of
     a gift, devise or other such transaction), the Market Price of the Shares
     on the day of the event causing the Shares to be held in the Charitable
     Trust and (2) the price per share received by the Charitable Trustee (net
     of any commissions and other expenses of sale) from the sale or other
     disposition of the Shares held in the Charitable Trust. The Charitable
     Trustee may reduce the amount payable to the Prohibited Owner by the amount
     of dividends and Distributions which have been paid to the Prohibited Owner
     and are owed by the Prohibited Owner to the Charitable Trustee pursuant to
     Section 6.2.3 of this Article VI. Any net sales proceeds in excess of the
     amount payable to the Prohibited Owner shall be immediately paid to the
     Charitable Beneficiary. If, prior to the discovery by the Corporation that
     Shares have been transferred to the Charitable Trustee, such Shares are
     sold by a Prohibited Owner, then (i) such Shares shall be deemed to have
     been sold on behalf of the Charitable Trust and (ii) to the extent that the
     Prohibited Owner received an amount for such Shares that exceeds the amount
     that such Prohibited Owner was entitled to receive pursuant to this Section
     6.2.4, such excess shall be paid to the Charitable Trustee upon demand.

          Section 6.2.5 Purchase Right in Shares Transferred to the Charitable
     Trustee. Shares transferred to the Charitable Trustee shall be deemed to
     have been offered for sale to the Corporation, or its designee, at a price
     per share equal to the lesser of (i) the price per share in the transaction
     that resulted in such transfer to the Charitable Trust (or, in the case of
     a devise or gift, the Market Price at the time of such devise or gift) and
     (ii) the Market Price on the date the Corporation, or its designee, accepts
     such offer. The Corporation may reduce the amount payable to the Prohibited
     Owner by the amount of dividends and distributions which has been paid to
     the Prohibited Owner and are owed by the Prohibited Owner to the Charitable
     Trustee pursuant to Section 6.2.3 of this Article VI. The Corporation may
     pay the amount of such reduction to the Charitable Trustee for the benefit
     of the Charitable Beneficiary. The Corporation shall have the right to
     accept such offer until the Charitable Trustee has sold the Shares held in
     the Charitable Trust pursuant to Section 6.2.4. Upon such a sale to the
     Corporation, the interest of the Charitable Beneficiary in the Shares sold
     shall terminate and the Charitable Trustee shall distribute the net
     proceeds of the sale to the Prohibited Owner.

          Section 6.2.6 Designation of Charitable Beneficiaries. By written
     notice to the Charitable Trustee, the Corporation shall designate one or
     more nonprofit organizations to be the Charitable Beneficiary of the
     interest in the Charitable Trust such that (i) Shares held in the
     Charitable Trust would not violate the restrictions set forth in Section
     6.1.1(a) in the hands of such Charitable Beneficiary and (ii) each such
     organization must be described in Section 501(c)(3) of the Code and
     contributions to each such organization must be eligible for deduction
     under each of Sections 170(b)(1)(A), 2055 and 2522 of the Code.


                                      -19-



     Section 6.3 NYSE Transactions. Nothing in this Article VI shall preclude
the settlement of any transaction entered into through the facilities of the
NYSE or any other national securities exchange or automated inter-dealer
quotation system. The fact that the settlement of any transaction occurs shall
not negate the effect of any other provision of this Article VI and any
transferee in such a transaction shall be subject to all of the provisions and
limitations set forth in this Article VI.

     Section 6.4 Enforcement. The Corporation is authorized specifically to seek
equitable relief, including injunctive relief, to enforce the provisions of this
Article VI.

     Section 6.5 Non-Waiver. No delay or failure on the part of the Corporation
or the Board of Directors in exercising any right hereunder shall operate as a
waiver of any right of the Corporation or the Board of Directors, as the case
may be, except to the extent specifically waived in writing.

                                   ARTICLE VII

                        PROVISIONS FOR DEFINING, LIMITING
                      AND REGULATING CERTAIN POWERS OF THE
                CORPORATION AND OF THE STOCKHOLDERS AND DIRECTORS

     Section 7.1 Number of Directors. The business and affairs of the
Corporation shall be managed under the direction of the Board of Directors. The
number of Directors of the Corporation (the "Directors") shall be five, which
number may be increased or decreased from time to time pursuant to the Bylaws;
provided, however, that the total number of Directors shall not be fewer than
three. A majority of the Board will be Independent Directors except for a period
of up to 90 days after the death, removal or resignation of an Independent
Director pending the election of such Independent Director's successor. The
names of the Directors who shall serve until the first annual meeting of
stockholders and until their successors are duly elected and qualify are:

                                 Wm. Polk Carey
                                 Gordon F. DuGan
                               Elizabeth P. Munson
                                Richard J. Pinola
                                 James D. Price

These Directors may increase the number of Directors and fill any vacancy,
whether resulting from an increase in the number of Directors or otherwise, on
the Board of Directors prior to the first annual meeting of Stockholders in the
manner provided in the Bylaws.

     The Corporation elects, at such time as it becomes eligible to make the
election provided for under Section 3-804(c) of the MGCL, that, except as may be
provided by the Board of Directors in setting the terms of any class or series
of Shares, any and all vacancies on the Board of Directors may be filled only by
the affirmative vote of a majority of the remaining Directors in office, even if
the remaining Directors do not constitute a quorum, and any Director elected to
fill a vacancy shall serve for the remainder of the full term of the
directorship in which such vacancy occurred. Notwithstanding the foregoing
sentence, Independent Directors shall nominate replacements for vacancies among
the Independent Directors' positions, provided, however, that if there are no
Independent Directors, the Directors shall nominate replacements for vacancies
among the Independent Directors.

     Section 7.2 Experience. Each Director shall have at least three years of
relevant experience demonstrating the knowledge and experience required to
successfully acquire and manage the type of


                                      -20-



assets being acquired by the Corporation. At least one of the Independent
Directors shall have three years of relevant real estate experience.

     Section 7.3 Committees. The Board may establish such committees as it deems
appropriate, in its discretion, provided that the majority of the members of
each committee are Independent Directors.

     Section 7.4 Term. Except as may otherwise be provided in the terms of any
Preferred Shares issued by the Corporation, each Director shall hold office for
one year, until the next annual meeting of Stockholders and until his or her
successor is duly elected and qualifies. Directors may be elected to an
unlimited number of successive terms.

     Section 7.5 Fiduciary Obligations. The Directors and the Advisor serve in a
fiduciary capacity to the Corporation and have a fiduciary duty to the
Stockholders of the Corporation, including, with respect to the Directors, a
specific fiduciary duty to supervise the relationship of the Corporation with
the Advisor.

     Section 7.6 Extraordinary Actions. Notwithstanding any provision of law
permitting or requiring any action to be taken or approved by the affirmative
vote of the holders of Shares entitled to cast a greater number of votes, any
such action shall be effective and valid if declared advisable by the Board of
Directors and taken or approved by the affirmative vote of holders of Shares
entitled to cast a majority of all the votes entitled to be cast on the matter.

     Section 7.7 Authorization by Board of Stock Issuance. The Board of
Directors may authorize the issuance from time to time of Shares of any class or
series, whether now or hereafter authorized, or securities or rights convertible
into Shares of any class or series, whether now or hereafter authorized, for
such consideration as the Board of Directors may deem advisable (or without
consideration in the case of a stock split or stock dividend), subject to such
restrictions or limitations, if any, as may be set forth in the Charter or the
Bylaws. The issuance of Preferred Shares shall also be approved by a majority of
Independent Directors not otherwise interested in the transaction, who shall
have access at the Corporation's expense to the Corporation's legal counsel or
to independent legal counsel.

     Section 7.8 Preemptive Rights and Appraisal Rights. Except as may be
provided by the Board of Directors in setting the terms of classified or
reclassified Shares pursuant to Section 5.4 or as may otherwise be provided by
contract approved by the Board of Directors, no holder of Shares shall, as such
holder, have any preemptive right to purchase or subscribe for any additional
Shares or any other security of the Corporation which it may issue or sell.
Holders of Shares shall not be entitled to exercise any rights of an objecting
stockholder provided for under Title 3, Subtitle 2 of the MGCL or any successor
statute unless the Board of Directors, upon the affirmative vote of a majority
of the Board of Directors, shall determine that such rights apply, with respect
to all or any classes or series of stock, to one or more transactions occurring
after the date of such determination in connection with which holders of such
Shares would otherwise be entitled to exercise such rights.

     Section 7.9 Determinations by Board. The determination as to any of the
following matters, made in good faith by or pursuant to the direction of the
Board of Directors consistent with the Charter, shall be final and conclusive
and shall be binding upon the Corporation and every holder of Shares: the amount
of the net income of the Corporation for any period and the amount of assets at
any time legally available for the payment of dividends, redemption of Shares or
the payment of other Distributions on Shares; the amount of paid-in surplus, net
assets, other surplus, annual or other cash flow, funds from operations, net
profit, net assets in excess of capital, undivided profits or excess of profits
over losses on sales of assets; the amount, purpose, time of creation, increase
or decrease, alteration or cancellation of


                                      -21-



any reserves or charges and the propriety thereof (whether or not any obligation
or liability for which such reserves or charges shall have been created shall
have been paid or discharged); any interpretation of the terms, preferences,
conversion or other rights, voting powers or rights, restrictions, limitations
as to dividends or Distributions, qualifications or terms or conditions of
redemption of any class or series of Shares; the fair value, or any sale, bid or
asked price to be applied in determining the fair value, of any asset owned or
held by the Corporation or any Shares; the number of Shares of any class of the
Corporation; any matter relating to the acquisition, holding and disposition of
any assets by the Corporation; any conflict between the MGCL and the provisions
set forth in the NASAA REIT Guidelines; or any other matter relating to the
business and affairs of the Corporation or required or permitted by applicable
law, the Charter or Bylaws or otherwise to be determined by the Board of
Directors; provided, however, that any determination by the Board of Directors
as to any of the preceding matters shall not render invalid or improper any
action taken or omitted prior to such determination and no Director shall be
liable for making or failing to make such a determination; and provided,
further, that to the extent the Board determines that the MGCL conflicts with
the provisions set forth in the NASAA REIT Guidelines, the NASAA REIT Guidelines
control to the extent any provisions of the MGCL are not mandatory.

     Section 7.10 REIT Qualification. If the Corporation elects to qualify for
federal income tax treatment as a REIT, the Board of Directors shall use its
reasonable best efforts to take such actions as are necessary or appropriate to
preserve the status of the Corporation as a REIT; however, the Board of
Directors may revoke or otherwise terminate the Corporation's REIT election
pursuant to Section 856(g) of the Code if a majority of the directors not
otherwise interested in the transaction conclude that a failure to effect such a
revocation or termination could result in material adverse tax consequences to
the Corporation or its stockholders. The Board of Directors also may determine
that compliance with any restriction or limitation on stock ownership and
transfers set forth in Article VII is no longer required for REIT qualification.

     Section 7.11 Removal of Directors. Subject to the rights of holders of one
or more classes or series of Preferred Shares to elect or remove one or more
Directors, any Director, or the entire Board of Directors, may be removed from
office at any time, but only by the affirmative vote of at least a majority of
the votes entitled to be cast generally in the election of Directors at a
meeting called for the purpose of removing the Director, and the notice of that
meeting must state that the purpose, or one of the purposes of the meeting, is
the proposed removal of the Director.

                                  ARTICLE VIII

                                     ADVISOR

     Section 8.1 Appointment and Initial Investment of Advisor. The Board is
responsible for setting the general policies of the Corporation and for the
general supervision of its business conducted by officers, agents, employees,
advisors or independent contractors of the Corporation. However, the Board is
not required personally to conduct the business of the Corporation, and it may
(but need not) appoint, employ or contract with any Person (including a Person
Affiliated with any Director) as an Advisor and may grant or delegate such
authority to the Advisor as the Board may, in its sole discretion, deem
necessary or desirable. The term of retention of any Advisor shall not exceed
one year, although there is no limit to the number of times that a particular
Advisor may be retained. The Advisor or its Affiliates have made an initial
investment of $200,000 in the Corporation. The Advisor or any such Affiliate may
not sell this initial investment while the Advisor remains a Sponsor but may
transfer the initial investment to other Affiliates.


                                      -22-



     Section 8.2 Supervision of Advisor. The Board shall evaluate the
performance of the Advisor before entering into or renewing an Advisory
Agreement, and the criteria used in such evaluation shall be reflected in the
minutes of the meetings of the Board. The Board may exercise broad discretion in
allowing the Advisor to administer and regulate the operations of the
Corporation, to act as agent for the Corporation, to execute documents on behalf
of the Corporation and to make executive decisions that conform to general
policies and principles established by the Board. The Board shall monitor the
Advisor to assure that the administrative procedures, operations and programs of
the Corporation are in the best interests of the Stockholders and are fulfilled.
The Independent Directors are responsible for reviewing the fees and expenses of
the Corporation at least annually or with sufficient frequency to determine that
the expenses incurred are reasonable in light of the investment performance of
the Corporation, its Net Assets, its Adjusted Net Income and the fees and
expenses of other comparable unaffiliated REITs. Each such determination shall
be reflected in the minutes of the meetings of the Board. The Independent
Directors also will be responsible for reviewing, from time to time and at least
annually, the performance of the Advisor and determining that compensation to be
paid to the Advisor is reasonable in relation to the nature and quality of
services performed and the investment performance of the Corporation and that
the provisions of the Advisory Agreement are being carried out. Specifically,
the Independent Directors will consider factors such as (i) the amount of the
fee paid to the Advisor in relation to the size, composition and performance of
the Assets, (ii) the success of the Advisor in generating opportunities that
meet the investment objectives of the Corporation, (iii) rates charged to other
REITs and to investors other than REITs by advisors performing the same or
similar services, (iv) additional revenues realized by the Advisor and its
Affiliates through their relationship with the Corporation, including loan
administration, underwriting or broker commissions, servicing, engineering,
inspection and other fees, whether paid by the Corporation or by others with
whom the Corporation does business, (v) the quality and extent of service and
advice furnished by the Advisor, (vi) the performance of the Assets, including
income, conservation or appreciation of capital, frequency of problem
investments and competence in dealing with distress situations, and (vii) the
quality of the Corporation's portfolio relative to the investments generated by
the Advisor for its own account. The Independent Directors may also consider all
other factors that it deems relevant, and the findings of the Independent
Directors on each of the factors considered shall be recorded in the minutes of
the Board. The Board shall determine whether any successor Advisor possesses
sufficient qualifications to perform the advisory function for the Corporation
and whether the compensation provided for in its contract with the Corporation
is justified.

     Section 8.3 Fiduciary Obligations. The Advisor shall have a fiduciary
responsibility and duty to the Corporation and to the Stockholders.

     Section 8.4 Affiliation and Functions. The Board, by resolution or in the
Bylaws, may provide guidelines, provisions or requirements concerning the
affiliation and functions of the Advisor.

     Section 8.5 Termination. Either a majority of the Independent Directors or
the Advisor may terminate the Advisory Agreement on 60 days' written notice
without cause or penalty, and, in such event, the Advisor will cooperate with
the Corporation and the Board in making an orderly transition of the advisory
function.

     Section 8.6 Disposition Fee on Sale of Property. Unless otherwise provided
in any resolution adopted by the Board of Directors, if the Advisor, any
Director, Sponsor or any Affiliate thereof provides a substantial amount of
services in the effort to sell an Investment, then such Person may receive a fee
in the amount equal to the lesser of (i) 50% of the Competitive Real Estate
Commission (if applicable) and (ii) three percent of the Contract Sales Price.
Total brokerage commissions (including real estate brokerage commissions)
payable to all Persons shall not exceed the lesser of (a) the Competitive Real
Estate Commission or (b) an amount equal to six percent of the Contract Sales
Price.


                                      -23-



     Section 8.7 Incentive Fees. Unless otherwise provided in any resolution
adopted by the Board of Directors, the Corporation may pay the Advisor or an
Affiliate of the Advisor an interest in the gain from the sale of Investments,
provided the amount or percentage of such interest is reasonable. Such an
interest in gain from the sale of Investments shall be considered presumptively
reasonable if it does not exceed 15% of the balance of such net proceeds
remaining after payment to Stockholders, in the aggregate, of an amount equal to
100% of the invested capital (through liquidity or Distributions), plus a six
percent cumulative annual return. In the case of multiple Advisors, such Advisor
and any of their Affiliates shall be allowed such fees provided such fees are
distributed by a proportional method reasonably designed to reflect the value
added to the Corporation assets by each respective Advisor or any Affiliate. For
these purposes, Stockholders will be deemed to have been provided with liquidity
if the Shares are Listed, if Shares can be redeemed through the Corporation's
redemption plan on a quarterly basis without delay or some other liquidity
device has been provided which enables Stockholders to receive cash or
marketable securities for their Shares no less frequently than quarterly. The
return requirement will be deemed satisfied if the total distributions paid by
the Corporation equals or exceeds 100% of the capital raised by the Corporation
(less any amounts distributed from the sale or refinancing of any Investment).
The market value will be calculated on the basis of the average market value of
the Shares over the 30 trading days beginning 180 days after the Shares are
first listed on a stock exchange or listed or included for quotation.

     Section 8.8 Limitation on Organization and Offering Expenses and
Acquisition Fees. The Organization and Offering Expenses shall be reasonable. To
the extent that all Organizational and Offering Expenses (excluding selling
commissions, wholesaling fees, and fees paid and expenses reimbursed to Selected
Dealers) paid directly by the Corporation and its subsidiaries exceed four
percent of the Gross Proceeds, the excess will be paid by the Advisor. The total
of all Acquisition Fees (including Subordinated Acquisition Fees) and
Acquisition Expenses shall be reasonable and shall not exceed an amount equal to
six percent of the aggregate Contract Purchase Price of all Investments,
measured for the period beginning with the initial acquisition of an Investment
and ending (i) on December 31 of the year in which the Corporation has invested
90% of the net proceeds of its initial Offering (excluding the net proceeds from
the sale of Shares pursuant to the Reinvestment Plan), and (ii) on each December
31 thereafter, unless a majority of the Directors (including a majority of the
Independent Directors) not otherwise interested in any transaction approves the
excess as being commercially competitive, fair and reasonable to the
Corporation. In the event that the Sponsor holds an Investment on an interim
basis on behalf of the Corporation, all profits and losses generated from that
Investment during the interim period will be paid to the Corporation.

     Section 8.9 Reimbursement for Total Operating Expenses. If Operating
Expenses during the 12-month period ending on the last day of any fiscal quarter
of the Corporation exceed the greater of (i) two percent of the Average Invested
Assets during the same 12-month period or (ii) 25% of the Adjusted Net Income of
the Corporation during the same 12-month period, then subject to the following
sentence, such excess amount shall be the sole responsibility of the Advisor and
neither the Operating Partnership nor the Corporation shall be liable for
payment therefor. Notwithstanding the foregoing, to the extent that the Advisor
becomes responsible for any excess amount as provided in the foregoing sentence,
if a majority of the Independent Directors finds such excess amount or a portion
thereof justified based on such unusual and non-recurring factors as they deem
sufficient, the Operating Partnership shall reimburse the Advisor in future
quarters for the full amount of such excess, or any portion thereof, but only to
the extent such reimbursement would not cause the Operating Expenses to exceed
the 2%/25% Guidelines in the 12-month period ending on the last day of such
quarter. In no event shall the Operating Expenses payable by the Operating
Partnership in any 12-month period ending at the end of a fiscal quarter exceed
the 2%/25% Guidelines. Within 60 days after the end of any 12-month period
referred to in the foregoing for which Operating Expenses (for the 12 months
then ended) do exceed the 2%/25% Guidelines and the Independent Directors
determine that such excess Operating


                                      -24-



Expenses are justified, there shall be sent to the Stockholders a written
disclosure of such fact, together with an explanation of the factors the
Independent Directors considered in ascertaining that such excess Operating
Expenses were justified. Additionally, such information shall be reflected in
the minutes of the meetings of the Board. All figures used in the foregoing
computation shall be determined in accordance with generally accepted accounting
principles applied in a consistent basis.

     Section 8.10 Reimbursement Limitation. The Corporation shall not reimburse
the Advisor or its Affiliates for services for which the Advisor or its
Affiliates are entitled to compensation in the form of a separate fee.

     Section 8.11 Other Activities of the Advisor. The Advisor shall not be
restricted to administering the investment activities of the Corporation as its
sole and exclusive function and may have other business interests and may engage
in other activities similar or in addition to those relating to the Corporation,
including the performance of services and advice to other Persons (including
other REITs) and the management of other investments (including investments of
the Advisor and its Affiliates). The Directors may request the Advisor to engage
in other activities which complement the Investments, and the Advisor may
receive compensation or commissions for those activities from the Corporation or
other Persons. Nothing herein shall limit or restrict the right of any director,
officer, employee or shareholder of the Advisor, whether or not also a Director,
officer or employee of the Company, to engage in any other business or to render
services of any kind to any other partnership, corporation, firm, individual,
trust or association. The Advisor with or without remuneration may render advice
and service to Persons involved with Investments. Except as provided in the
Advisory Agreement, neither the Advisor nor any Affiliate of the Advisor shall
be obligated generally to present any particular investment opportunity to the
Corporation even if the opportunity is of character which, if presented to the
Corporation, could be taken by the Corporation. In the event that the Advisor or
its Affiliates is presented with a potential investment which might be made by
the Corporation or any wholly-owned subsidiary corporation and by another
investment entity which the Advisor or its Affiliates advises or manages, the
Advisor shall determine the allocation of such potential investment in a fair
and reasonable manner and pursuant to procedures approved by a majority of the
Independent Directors.

                                   ARTICLE IX

                      INVESTMENT OBJECTIVES AND LIMITATIONS

     Section 9.1 Review of Objectives. The Independent Directors shall review
the investment policies of the Corporation with sufficient frequency (not less
often than annually) to determine that the policies being followed by the
Corporation are in the best interests of its Stockholders. Each such
determination and the basis therefor shall be set forth in the minutes of the
meetings of the Board.

     Section 9.2 Certain Permitted Investments. Until such time as the Common
Shares are Listed, the following investment limitations shall apply:

               (a) The Corporation may invest in Investments.

               (b) The Corporation may invest in Joint Ventures with the
          Sponsor, Advisor, one or more Directors or any Affiliate, only if a
          majority of Directors (including a majority of Independent Directors)
          not otherwise interested in the transaction, approve such investment
          as being fair and reasonable to the Corporation and on substantially
          the same terms and conditions as those received by the other joint
          venturers.


                                      -25-



     Section 9.3 Investment Limitations. Until such time as the Common Shares
are Listed, the following investment limitations shall apply. In addition to
other investment restrictions imposed by the Board from time to time, consistent
with the Corporation's objective of qualifying as a REIT, the following shall
apply to the Corporation's investments:

               (a) Not more than ten percent of the Corporation's total assets
          shall be invested in Unimproved Real Property or mortgage loans on
          Unimproved Real Property.

               (b) The Corporation shall not invest in commodities or commodity
          future contracts. This limitation is not intended to apply to futures
          contracts, when used solely for hedging purposes in connection with
          the Corporation's ordinary business of investing in real estate assets
          and mortgages.

               (c) The Corporation shall not invest in or make any mortgage loan
          unless an appraisal is obtained concerning the underlying property
          except for those loans insured or guaranteed by a government or
          government agency. In cases in which a majority of Independent
          Directors so determine, and in all cases in which the transaction is
          with the Advisor, Sponsor, Directors, or any Affiliates thereof, such
          appraisal of the underlying property must be obtained from an
          Independent Appraiser. Such appraisal shall be maintained in the
          Corporation's records for at least five years and shall be available
          for inspection and duplication by any Stockholder for a reasonable
          charge. In addition to the appraisal, a mortgagee's or owner's title
          insurance policy or commitment as to the priority of the mortgage or
          condition of the title must be obtained.

               (d) The Corporation shall not make or invest in any mortgage
          loan, including a construction loan, on any one property if the
          aggregate amount of all mortgage loans outstanding on the property,
          including the loans of the Corporation, would exceed an amount equal
          to 85% of the appraised value of the property as determined by
          appraisal unless substantial justification exists because of the
          presence of other underwriting criteria. For purposes of this
          subsection, (i) investments in commercial mortgage backed securities
          shall be deemed not to be an investment in mortgage loans and (ii) the
          "aggregate amount of all mortgage loans outstanding on the property,
          including the loans of the Corporation" shall include all interest
          (excluding contingent participation in income and/or appreciation in
          value of the mortgaged property), the current payment of which may be
          deferred pursuant to the terms of such loans, to the extent that
          deferred interest on each loan exceeds five percent per annum of the
          principal balance of the loan.

               (e) The Corporation shall not invest in indebtedness secured by a
          mortgage on real property which is subordinate to the lien or other
          indebtedness of the Advisor, any Director, the Sponsor or any
          Affiliate of the Corporation.

               (f) The Corporation shall not issue (A) equity Securities
          redeemable solely at the option of the holder (except that
          Stockholders may offer their Common Shares to the Corporation pursuant
          to any repurchase plan adopted by the Board on terms outlined in the
          Prospectus relating to any Offering, as such plan is thereafter
          amended in accordance with its terms); (B) debt Securities unless the
          historical debt service coverage (in the most recently completed
          fiscal year) as adjusted for known changes is sufficient to properly
          service that higher level of debt; (C) equity Securities on a deferred
          payment basis or under similar arrangements; or (D) options or
          warrants to the Advisor, Directors, Sponsor or any Affiliate thereof
          except on the same terms as such options or warrants are sold to the
          general public. Options or warrants may be issued to persons other
          than the


                                      -26-



          Advisor, Directors, Sponsor or any Affiliate thereof, but not at
          exercise prices less than the fair market value of the underlying
          Securities on the date of grant and not for consideration (which may
          include services) that in the judgment of the Independent Directors
          has a market value less than the value of such option or warrant on
          the date of grant. Options or warrants issuable to the Advisor,
          Directors, Sponsor or any Affiliate thereof shall not exceed ten
          percent of the outstanding Shares on the date of grant. The voting
          rights per Share (other than any publicly held Share) sold in a
          private offering shall not exceed the voting rights which bear the
          same relationship to the voting rights of a publicly held Share as the
          consideration paid to the Corporation for each privately offered Share
          bears to the book value of each outstanding publicly held Share.

               (g) The consideration paid for an Investment by the Corporation
          shall ordinarily be based on the fair market value thereof, as
          determined by a majority of the Directors (or of the members of a duly
          authorized committee thereof) or the Advisor's investment committee.
          If a majority of the Independent Directors on the Board of Directors
          or such duly authorized committee determine, or if the Investment is
          acquired from the Advisor, a Director, the Sponsor or their
          Affiliates, such fair market value shall be determined by a qualified
          Independent Appraiser selected by such Independent Directors.

               (h) The aggregate Leverage shall be reasonable and shall be
          reviewed by the Board at least quarterly. The maximum amount of such
          Leverage shall not exceed the lesser of 75% of the total costs of the
          Corporation's investment or 300% of its Net Assets. Notwithstanding
          the foregoing, Leverage may exceed such limit if any excess in
          borrowing over such level is approved by a majority of the Independent
          Directors. Any such excess borrowing shall be disclosed to
          Stockholders in the next quarterly report of the Corporation following
          such borrowing, along with justification for such excess.

               (i) The Corporation will continually review its investment
          activity to attempt to ensure that it is not classified as an
          "investment company" under the Investment Company Act of 1940, as
          amended.

               (j) The Corporation will not make any investment that the
          Corporation believes will be inconsistent with its objectives of
          qualifying and remaining qualified as a REIT unless and until the
          Board determines, in its sole discretion, that REIT qualification is
          not in the best interests of the Corporation.

               (k) The Corporation shall not invest in real estate contracts of
          sale unless such contracts of sale are in recordable form and
          appropriately recorded in the chain of title.

                                    ARTICLE X

                              CONFLICTS OF INTEREST

     Section 10.1 Sales and Leases to the Corporation. The Corporation may
purchase or lease an asset or assets from the Sponsor, the Advisor, a Director
or any Affiliate thereof upon a finding by a majority of Directors (including a
majority of Independent Directors) not otherwise interested in the transaction
that such transaction is fair and reasonable to the Corporation and at a price
to the Corporation no greater than the cost of the asset to such Sponsor,
Advisor, Director or Affiliate, or, if the price to the Corporation is in excess
of such cost, that substantial justification for such excess exists and such
excess


                                      -27-



is reasonable. In no event shall the purchase price of any Property to the
Corporation exceed its current Appraised Value.

     Section 10.2 Sales and Leases to the Sponsor, Advisor, Directors or
Affiliates. An Advisor, Sponsor, Director or Affiliate thereof may purchase or
lease Assets from the Corporation if a majority of Directors (including a
majority of Independent Directors) not otherwise interested in the transaction
determine that the transaction is fair and reasonable to the Corporation.

     Section 10.3 Other Transactions.

               (a) The Corporation shall not engage in any other transaction
          with the Sponsor, the Advisor, a Director or any Affiliates thereof
          unless a majority of the Directors (including a majority of the
          Independent Directors) not otherwise interested in such transaction
          approve such transaction as fair and reasonable to the Corporation and
          on terms and conditions not less favorable to the Corporation than
          those available from unaffiliated third parties.

               (b) The Corporation shall not make loans to the Sponsor, the
          Advisor, a Director or any Affiliates thereof except Loans pursuant to
          Section 9.3(c) hereof or loans to wholly owned subsidiaries of the
          Corporation. The Sponsor, Advisor, Directors and any Affiliates
          thereof shall not make Loans to the Corporation, or to joint ventures
          in which the Corporation is a co-venturer, unless approved by a
          majority of the Directors (including a majority of the Independent
          Directors) not otherwise interested in such transaction as fair,
          competitive, and commercially reasonable, and no less favorable to the
          Corporation than comparable loans between unaffiliated parties.

                                   ARTICLE XI

                                  STOCKHOLDERS

     Section 11.1 Meetings. There shall be an annual meeting of the
Stockholders, to be held on such date and at such time and place as shall be
determined by or in the manner prescribed in the Bylaws, at which the Directors
shall be elected and any other proper business may be conducted; provided that
such annual meeting will be held upon reasonable notice and within a reasonable
period (not less than 30 days) following delivery of the annual report. The
holders of a majority of Shares entitled to vote who are present in person or by
proxy at an annual meeting at which a quorum is present, may, without the
necessity for concurrence by the Board, vote to elect the Directors. A quorum
shall be the presence in person or by proxy of Stockholders entitled to cast at
least 50% of all the votes entitled to be cast at such meeting on any matter.
Special meetings of Stockholders may be called in the manner provided in the
Bylaws, including by the president or by a majority of the Directors or a
majority of the Independent Directors, and shall be called by an officer of the
Corporation upon written request of Stockholders entitled to cast not less than
ten percent of all the votes entitled to be cast at such meeting on any matter.
Notice of any special meeting of Stockholders shall be given as provided in the
Bylaws, and the special meeting shall be held not less than 15 days nor more
than 60 days after the delivery of such notice. If the meeting is called by
written request of Stockholders as described in this Section 11.1, the special
meeting shall be held at the time and place specified in the Stockholder
request; provided, however, that if none is so specified, at such time and place
convenient to the Stockholders. If there are no Directors, the officers of the
Corporation shall promptly call a special meeting of the Stockholders entitled
to vote for the election of successor Directors. Any meeting may be adjourned
and reconvened as the Board may determine or as otherwise provided in the
Bylaws.


                                      -28-



     Section 11.2 Voting Rights of Stockholders. Subject to the provisions of
any class or series of Shares then outstanding and the mandatory provisions of
any applicable laws or regulations, the Stockholders shall be entitled to vote
only on the following matters: (a) election or removal of Directors, without the
necessity for concurrence by the Board, as provided in Sections 11.1, 7.4 and
7.11 hereof; (b) amendment of the Charter, without the necessity for concurrence
by the Board, as provided in Article XIII hereof; (c) dissolution of the
Corporation, without the necessity for concurrence by the Board; (d) merger or
consolidation of the Corporation, or the sale or other disposition of all or
substantially all of the Corporation's assets; and (e) such other matters with
respect to which the Board of Directors has adopted a resolution declaring that
a proposed action is advisable and directing that the matter be submitted to the
Stockholders for approval or ratification. Except with respect to the foregoing
matters, no action taken by the Stockholders at any meeting shall in any way
bind the Board. Without the approval of a majority of the Shares entitled to
vote on the matter, the Board may not (i) amend the Charter to materially and
adversely affect the rights, preferences and privileges of the Stockholders;
(ii) amend provisions of the Charter relating to director qualifications,
fiduciary duties, liability and indemnification, conflicts of interest,
investment policies or investment restrictions; (iii) liquidate or dissolve the
Corporation other than before the initial investment in property; (iv) sell all
or substantially all of the Corporation's assets other than in the ordinary
course of business or as otherwise permitted by law; or (v) cause the merger or
reorganization of the Corporation except as permitted by law.

     Section 11.3 Voting Limitations on Shares Held by the Advisor, Directors
and Affiliates. With respect to Shares owned by the Advisor, any Director, or
any of their Affiliates, neither the Advisor, nor such Director(s), nor any of
their Affiliates may vote or consent on matters submitted to the Stockholders
regarding the removal of the Advisor, such Director(s) or any of their
Affiliates or any transaction between the Corporation and any of them. In
determining the requisite percentage in interest of Shares necessary to approve
a matter on which the Advisor, such Director(s) and any of their Affiliates may
not vote or consent, any Shares owned by any of them shall be deemed not
entitled to cast votes on the matter and shall not be included in making such
determination.

     Section 11.4 Right of Inspection. Any Stockholder and any designated
representative thereof shall be permitted access to the records of the
Corporation to which it is entitled under applicable law at all reasonable
times, and may inspect and copy any of them for a reasonable charge. Inspection
of the Corporation's books and records by the office or agency administering the
securities laws of a jurisdiction shall be provided upon reasonable notice and
during normal business hours.

     Section 11.5 Access to Stockholder List. An alphabetical list of the names,
addresses and telephone numbers of the Stockholders, along with the number of
Shares held by each of them (the "Stockholder List"), shall be maintained as
part of the books and records of the Corporation and shall be available for
inspection by any Stockholder or the Stockholder's designated agent at the home
office of the Corporation upon the request of the Stockholder only if the
Stockholder represents to the Corporation that the list will not be used to
pursue commercial interests of the Stockholder unrelated to the Stockholder's
interest in the Corporation. If the representation is not included with the
request, the Corporation will mail a copy of the representation within five
days. The Corporation will mail a list of the names and addresses of all
Stockholders within 10 days (or five days if the Stockholder first requests a
copy of the representation and returns it within 30 days) of the receipt of the
request and the payment for cost of postage and duplication. The Stockholder
List shall be updated at least quarterly to reflect changes in the information
contained therein. A copy of such list shall be mailed to any Stockholder so
requesting within ten days of receipt by the Corporation of the request. The
copy of the Stockholder List shall be printed in alphabetical order, on white
paper, and in a readily readable type size (in no event smaller than ten-point
type). The Corporation may impose a reasonable charge for expenses incurred in
reproduction pursuant to the Stockholder request. A Stockholder may request a
copy of the Stockholder


                                      -29-



List in connection with matters relating to Stockholders' voting rights, and the
exercise of Stockholder rights under federal proxy laws.

     If the Advisor or the Board neglects or refuses to exhibit, produce or mail
a copy of the Stockholder List as requested, the Advisor and/or the Board, as
the case may be, shall be liable to any Stockholder requesting the list for the
costs, including reasonable attorneys' fees, incurred by that Stockholder for
compelling the production of the Stockholder List, and for actual damages
suffered by any Stockholder by reason of such refusal or neglect. It shall be a
defense that the actual purpose and reason for the requests for inspection or
for a copy of the Stockholder List is to secure such list of Stockholders or
other information for the purpose of selling such list or copies thereof, or of
using the same for a commercial purpose other than in the interest of the
applicant as a Stockholder relative to the affairs of the Corporation. The
remedies provided hereunder to Stockholders requesting copies of the Stockholder
List are in addition, to and shall not in any way limit, other remedies
available to Stockholders under federal law, or the laws of any state.

     Section 11.6 Reports. The Directors, including the Independent Directors,
shall take reasonable steps to insure that the Corporation shall cause to be
prepared and mailed or delivered to each Stockholder as of a record date after
the end of the fiscal year and each holder of other publicly held Securities
within 120 days after the end of the fiscal year to which it relates an annual
report for each fiscal year ending after the Commencement of the Initial Public
Offering that shall include: (i) financial statements prepared in accordance
with generally accepted accounting principles which are audited and reported on
by independent certified public accountants; (ii) the ratio of the costs of
raising capital during the period to the capital raised; (iii) the aggregate
amount of advisory fees and the aggregate amount of other fees paid to the
Advisor and any Affiliate of the Advisor by the Corporation and including fees
or charges paid to the Advisor and any Affiliate of the Advisor by third parties
doing business with the Corporation; (iv) the Operating Expenses of the
Corporation, stated as a percentage of Average Invested Assets and as a
percentage of its Net Income; (v) a report from the Independent Directors that
the policies being followed by the Corporation are in the best interests of its
Stockholders and the basis for such determination; and (vi) separately stated,
full disclosure of all material terms, factors and circumstances surrounding any
and all transactions involving the Corporation, Directors, Advisors, Sponsors
and any Affiliate thereof occurring in the year for which the annual report is
made, and the Independent Directors shall be specifically charged with a duty to
examine and comment in the report on the fairness of such transactions.

                                   ARTICLE XII

                    LIABILITY LIMITATION AND INDEMNIFICATION

     Section 12.1 Limitation of Stockholder Liability. No Stockholder shall be
liable for any debt, claim, demand, judgment or obligation of any kind of,
against or with respect to the Corporation by reason of his or her being a
Stockholder, nor shall any Stockholder be subject to any personal liability
whatsoever, in tort, contract or otherwise, to any Person in connection with the
Corporation's assets or the affairs of the Corporation by reason of his or her
being a Stockholder.

     Section 12.2 Limitation of Director and Officer Liability; Indemnification.

          Section 12.2.1 Limitation of Director and Officer Liability.

               (a) Subject to the limitations set forth under Maryland law and
          in paragraph (b) below, no Director or officer of the Corporation
          shall be liable to the Corporation or its Stockholders for money
          damages. Neither the amendment nor repeal


                                      -30-



          of this Section 12.2.1(a), nor the adoption or amendment of any other
          provision of the Charter or Bylaws inconsistent with this Section
          12.2.1(a), shall apply to or affect in any respect the applicability
          of the preceding sentence with respect to any act or failure to act
          which occurred prior to such amendment, repeal or adoption.

               (b) Notwithstanding anything to the contrary contained in
          paragraph (a) above, the Corporation shall not provide that a
          Director, the Advisor or any Affiliate of the Advisor (the
          "Indemnitee") be held harmless for any loss or liability suffered by
          the Corporation, unless all of the following conditions are met:

                    (i) The Indemnitee has determined, in good faith, that the
               course of conduct that caused the loss or liability was in the
               best interests of the Corporation.

                    (ii) The Indemnitee was acting on behalf of or performing
               services for the Corporation.

                    (iii) Such liability or loss was not the result of (A)
               negligence or misconduct, in the case that the Indemnitee is a
               Director (other than an Independent Director), the Advisor or an
               Affiliate of the Advisor or (B) gross negligence or willful
               misconduct, in the case that the Indemnitee is an Independent
               Director.

                    (iv) Such agreement to hold harmless is recoverable only out
               of Net Assets and not from the Stockholders.

          Section 12.2.2 Indemnification.

               (a) Subject to the limitations set forth under Maryland law and
          in paragraph (b) or (c) below, the Corporation shall indemnify and,
          without requiring a preliminary determination of the ultimate
          entitlement to indemnification, pay or reimburse reasonable expenses
          in advance of final disposition of a proceeding to (i) any individual
          who is a present or former Director or officer of the Corporation and
          who is made or threatened to be made a party to the proceeding by
          reason of his or her service in that capacity, (ii) any individual
          who, while a Director or officer of the Corporation and at the request
          of the Corporation, serves or has served as a director, officer,
          partner or trustee of such corporation, real estate investment trust,
          partnership, joint venture, trust, employee benefit plan or other
          enterprise and who is made or threatened to be made a party to the
          proceeding by reason of his or her service in that capacity or (iii)
          the Advisor of any of its Affiliates acting as an agent of the
          Corporation. The Corporation may, with the approval of the Board of
          Directors or any duly authorized committee thereof, provide such
          indemnification and advance for expenses to a person who served a
          predecessor of the Corporation in any of the capacities described in
          (i) or (ii) above and to any employee or agent of the Corporation or a
          predecessor of the Corporation. The Board may take such action as is
          necessary to carry out this Section 12.2.2(a). No amendment of the
          Charter or repeal of any of its provisions shall limit or eliminate
          the right of indemnification provided hereunder with respect to acts
          or omissions occurring prior to such amendment or repeal.

               (b) Notwithstanding anything to the contrary contained in
          paragraph (a) above, the Corporation shall not provide for
          indemnification of an "Indemnitee" for any


                                      -31-



          liability or loss suffered by such Indemnitee unless all of the
          following conditions are met:

                    (i) The Indemnitee has determined, in good faith, that the
               course of conduct that caused the loss or liability was in the
               best interests of the Corporation.

                    (ii) The Indemnitee was acting on behalf of or performing
               services for the Corporation.

                    (iii) Such liability or loss was not the result of (A)
               negligence or misconduct, in the case that the Indemnitee is a
               Director (other than an Independent Director), the Advisor or an
               Affiliate of the Advisor or (B) gross negligence or willful
               misconduct, in the case that the Indemnitee is an Independent
               Director.

                    (iv) Such indemnification is recoverable only out of Net
               Assets and not from the Stockholders.

               (c) Notwithstanding anything to the contrary contained in
          paragraph (a) the Corporation shall not provide indemnification for
          any loss, liability or expense arising from or out of an alleged
          violation of federal or state securities laws by an Indemnitee unless
          one or more of the following conditions are met: (i) there has been a
          successful adjudication on the merits of each count involving alleged
          material securities law violations as to the Indemnitee, (ii) such
          claims have been dismissed with prejudice on the merits by a court of
          competent jurisdiction as to the Indemnitee; or (iii) a court of
          competent jurisdiction approves a settlement of the claims against the
          Indemnitee and finds that indemnification of the settlement and the
          related costs should be made, and the court considering the request
          for indemnification has been advised of the position of the Securities
          and Exchange Commission and of the published position of any state
          securities regulatory authority in which Securities were offered or
          sold as to indemnification for violations of securities laws.

     Section 12.3 Payment of Expenses. The Corporation shall pay or reimburse
reasonable legal expenses and other costs incurred by an Indemnitee in advance
of final disposition of a proceeding if all of the following are satisfied: (i)
the proceeding relates to acts or omissions with respect to the performance of
duties or services on behalf of the Corporation, (ii) the Indemnitee provides
the Corporation with written affirmation of the Indemnitee's good faith belief
that the Indemnitee has met the standard of conduct necessary for
indemnification by the Corporation as authorized by Section 12.2 hereof, (iii)
the legal proceeding was initiated by a third party who is not a Stockholder or,
if by a Stockholder of the Corporation acting in his or her capacity as such, a
court of competent jurisdiction approves such advancement, and (iv) the
Indemnitee provides the Corporation with a written agreement to repay the amount
paid or reimbursed by the Corporation, together with the applicable legal rate
of interest thereon, if it is ultimately determined that the Indemnitee did not
comply with the requisite standard of conduct and is not entitled to
indemnification.

     Section 12.4 Express Exculpatory Clauses in Instruments. Neither the
Stockholders nor the Directors, officers, employees or agents of the Corporation
shall be liable under any written instrument creating an obligation of the
Corporation by reason of their being Stockholders, Directors, officers,
employees or agents of the Corporation, and all Persons shall look solely to the
Corporation's assets for the payment of any claim under or for the performance
of that instrument. The omission of the foregoing


                                      -32-



exculpatory language from any instrument shall not affect the validity or
enforceability of such instrument and shall not render any Stockholder,
Director, officer, employee or agent liable thereunder to any third party, nor
shall the Directors or any officer, employee or agent of the Corporation be
liable to anyone as a result of such omission.

                                  ARTICLE XIII

                                   AMENDMENTS

     The Corporation reserves the right from time to time to make any amendment
to the Charter, now or hereafter authorized by law, including any amendment
altering the terms or contract rights, as expressly set forth in the Charter, of
any Shares. All rights and powers conferred by the Charter on Stockholders,
Directors and officers are granted subject to this reservation. Except for those
amendments permitted to be made without Stockholder approval under Maryland law
or by specific provision in the Charter, any amendment to the Charter shall be
valid only if approved by the affirmative vote of a majority of all votes
entitled to be cast on the matter, including without limitation, (1) any
amendment which would adversely affect the rights, preferences and privileges of
the Stockholders and (2) any amendment to Sections 7.2, 7.5 and 7.11 of Article
VII, Article IX, Article X, Article XII and Article XIV hereof and this Article
XIII (or any other amendment of the Charter that would have the effect of
amending such sections).

                                   ARTICLE XIV

                              ROLL-UP TRANSACTIONS

     In connection with any proposed Roll-Up Transaction, an appraisal of all of
the Corporation's assets shall be obtained from a competent Independent
Appraiser. The Corporation's assets shall be appraised on a consistent basis,
and the appraisal shall be based on the evaluation of all relevant information
and shall indicate the value of the assets as of a date immediately prior to the
announcement of the proposed Roll-Up Transaction. The appraisal shall assume an
orderly liquidation of the assets over a twelve-month period. The terms of the
engagement of the Independent Appraiser shall clearly state that the engagement
is for the benefit of the Corporation and the Stockholders. A summary of the
appraisal, indicating all material assumptions underlying the appraisal, shall
be included in a report to Stockholders in connection with a proposed Roll-Up
Transaction. In connection with a proposed Roll-Up Transaction, the person
sponsoring the Roll-Up Transaction shall offer to Stockholders who vote against
the proposed Roll-Up Transaction the choice of:

               (a) accepting the securities of a Roll-Up Entity offered in the
          proposed Roll-Up Transaction; or

               (b) one of the following:

                    (i) remaining as Stockholders and preserving their interests
               therein on the same terms and conditions as existed previously;
               or

                    (ii) receiving cash in an amount equal to the Stockholder's
               pro rata share of the appraised value of the net assets of the
               Corporation.

     The Corporation is prohibited from participating in any proposed Roll-Up
Transaction:


                                      -33-



               (a) that would result in the Stockholders having voting rights in
          a Roll-Up Entity that are less than the rights provided for in
          Sections 11.1 and 11.2 hereof;

               (b) that includes provisions that would operate as a material
          impediment to, or frustration of, the accumulation of Shares by any
          purchaser of the securities of the Roll-Up Entity (except to the
          minimum extent necessary to preserve the tax status of the Roll-Up
          Entity), or which would limit the ability of an investor to exercise
          the voting rights of its securities of the Roll-Up Entity on the basis
          of the number of Shares held by that investor;

               (c) in which investor's rights to access of records of the
          Roll-Up Entity will be less than those described in Sections 11.4 and
          11.5 hereof; or

               (d) in which any of the costs of the Roll-Up Transaction would be
          borne by the Corporation if the Roll-Up Transaction is rejected by the
          Stockholders.

     THIRD: The amendment to and restatement of the charter of the Corporation
as hereinabove set forth has been duly advised by the Board of Directors and
approved by the stockholders of the Corporation as required by law.

     FOURTH: The current address of the principal office of the Corporation is
as set forth in Article III of the foregoing amendment and restatement of the
charter.

     FIFTH: The name and address of the Corporation's current resident agent is
as set forth in Article III of the foregoing amendment and restatement of the
charter.

     SIXTH: The number of directors of the Corporation and the names of those
currently in office are as set forth in Article VII of the foregoing amendment
and restatement of the charter.

     SEVENTH: The total number of shares of stock which the Corporation had
authority to issue immediately prior to this amendment was 450,000,000,
consisting of 400,000,000 shares of Common Stock, $.001 par value per share and
50,000,000 shares of Preferred Stock, $.001 par value per share. The aggregate
par value of all shares of stock having par value was $450,000.00.

     EIGHTH: The total number of shares of stock which the Corporation has
authority to issue pursuant to the foregoing amendment and restatement of the
charter of the Corporation is 450,000,000, consisting of 400,000,000 shares of
Common Stock, $.001 par value per share, and 50,000,000 shares of Preferred
Stock, $.001 par value per share. The aggregate par value of all authorized
shares of stock having par value is $450,000.00.

     NINTH: The undersigned Chief Executive Officer acknowledges these Articles
of Amendment and Restatement to be the corporate act of the Corporation and as
to all matters or facts required to be verified under oath, the undersigned
Chief Executive Officer acknowledges that to the best of his knowledge,
information and belief, these matters and facts are true in all material
respects and that this statement is made under the penalties for perjury.


                                      -34-



     IN WITNESS WHEREOF, the Corporation has caused these Articles of Amendment
and Restatement to be signed in its name and on its behalf by its Chief
Executive Officer and attested to by its Secretary on this 12th day of November,
2007.

ATTEST:                                   CORPORATION PROPERTY ASSOCIATES
                                          17 - GLOBAL INCORPORATED


/s/ Susan C. Hyde                         /s/ Gordon F. DuGan             (SEAL)
- ---------------------------------------   -------------------------------
Name: Susan C. Hyde                       Name: Gordon F. DuGan
Title: Secretary                          Title: Chief Executive Officer

EX-3.2

                                                                     EXHIBIT 3.2
            CORPORATE PROPERTY ASSOCIATES 17 -- GLOBAL INCORPORATED

                                     BYLAWS

                                    ARTICLE I

                                     OFFICES

      Section 1. Principal Office. The principal office of the Corporation in
the State of Maryland shall be located at such place as the Board of Directors
may designate.

      Section 2. Additional Offices. The Corporation may have additional
offices, including a principal executive office, at such places as the Board of
Directors may from time to time determine or the business of the Corporation may
require.

                                   ARTICLE II

                            MEETINGS OF STOCKHOLDERS

      Section 1. Place. All meetings of stockholders shall be held at the
principal executive office of the Corporation or at such other place as shall be
set by the Board of Directors and stated in the notice of the meeting

      Section 2. Annual Meeting. An annual meeting of the stockholders for the
election of directors and the transaction of any business within the powers of
the Corporation shall be held on a date and at the time set by the Board of
Directors during the month of June in each year, beginning in the year 2008.

      Section 3. Special Meetings. The chairman of the board, the president, the
chief executive officer, a majority of the Board of Directors or a majority of
the Independent Directors (as defined in the charter of the Corporation (the
"Charter")) may call a special meeting of the stockholders. A special meeting of
stockholders shall also be called by the secretary of the Corporation upon the
written request of the holders of shares entitled to cast not less than ten
percent of all the votes entitled to be cast at such meeting. The written
request must state the purpose of such meeting and the matters proposed to be
acted on at such meeting. Within ten days after receipt of such written request,
either in person or by mail, the secretary of the Corporation shall provide all
stockholders with written notice, either in person or by mail, of such meeting
and the purpose of such meeting. Notwithstanding anything to the contrary
herein, such meeting shall be held not less than 15 days nor more than 60 days
after the secretary's delivery of such notice. Subject to the foregoing
sentence, such meeting shall be held at the time and place specified in the
shareholder request; provided, however, that if none is so specified, such
meeting shall be held at a time and place convenient to the stockholders.

      Section 4. Notice. Except as provided otherwise in Section 3 of this
Article II, not less than ten nor more than 90 days before each meeting of
stockholders, the secretary shall give to each stockholder entitled to vote at
such meeting and to each stockholder not entitled to vote who is entitled to
notice of the meeting written or printed notice stating the time and place of
the meeting and, in the case of a special meeting or as otherwise may be
required by any statute, the purpose for which the meeting is called, either by
mail, by presenting it to such stockholder personally, by leaving it at the
stockholder's residence or usual place of business or by any other means
permitted by Maryland law. If mailed, such



notice shall be deemed to be given when deposited in the United States mail
addressed to the stockholder at the stockholder's address as it appears on the
records of the Corporation, with postage thereon prepaid.

      Subject to Section 11(a) of this Article II, any business of the
Corporation may be transacted at an annual meeting of stockholders without being
specifically designated in the notice, except such business as is required by
any statute to be stated in such notice. No business shall be transacted at a
special meeting of stockholders except as specifically designated in the notice.

      Section 5. Organization and Conduct. Every meeting of stockholders shall
be conducted by an individual appointed by the Board of Directors to be chairman
of the meeting or, in the absence of such appointment, by the chairman of the
board or, in the case of a vacancy in the office or absence of the chairman of
the board, by one of the following officers present at the meeting: the vice
chairman of the board, if there be one, the president, the vice presidents in
their order of rank and seniority, or, in the absence of such officers, a
chairman chosen by the stockholders by the vote of a majority of the votes cast
by stockholders present in person or by proxy. The secretary, or, in the
secretary's absence, an assistant secretary, or in the absence of both the
secretary and assistant secretaries, a person appointed by the Board of
Directors or, in the absence of such appointment, a person appointed by the
chairman of the meeting shall act as secretary. In the event that the secretary
presides at a meeting of the stockholders, an assistant secretary, or in the
absence of assistant secretaries, an individual appointed by the Board of
Directors or the chairman of the meeting, shall record the minutes of the
meeting. The order of business and all other matters of procedure at any meeting
of stockholders shall be determined by the chairman of the meeting. The chairman
of the meeting may prescribe such rules, regulations and procedures and take
such action as, in the discretion of such chairman, are appropriate for the
proper conduct of the meeting, including, without limitation, (a) restricting
admission to the time set for the commencement of the meeting; (b) limiting
attendance at the meeting to stockholders of record of the Corporation, their
duly authorized proxies and other such individuals as the chairman of the
meeting may determine; (c) limiting participation at the meeting on any matter
to stockholders of record of the Corporation entitled to vote on such matter,
their duly authorized proxies and other such individuals as the chairman of the
meeting may determine; (d) limiting the time allotted to questions or comments
by participants; (e) determining when the polls should be opened and closed; (f)
maintaining order and security at the meeting; (g) removing any stockholder or
any other individual who refuses to comply with meeting procedures, rules or
guidelines as set forth by the chairman of the meeting; and (h) concluding a
meeting or recessing or adjourning the meeting to a later date and time and at a
place announced at the meeting. Unless otherwise determined by the chairman of
the meeting, meetings of stockholders shall not be required to be held in
accordance with the rules of parliamentary procedure.

      Section 6. Quorum. At any meeting of stockholders, the presence in person
or by proxy of stockholders entitled to cast a majority of all the votes
entitled to be cast at such meeting on any matter shall constitute a quorum; but
this section shall not affect any requirement under any statute or the Charter
for the vote necessary for the adoption of any measure. If, however, such quorum
shall not be present at any meeting of the stockholders, the chairman of the
meeting shall have the power to adjourn the meeting from time to time to a date
not more than 120 days after the original record date without notice other than
announcement at the meeting. At such adjourned meeting at which a quorum shall
be present, any business may be transacted which might have been transacted at
the meeting as originally notified.

      The stockholders present either in person or by proxy, at a meeting which
has been duly called and convened, may continue to transact business until
adjournment, notwithstanding the withdrawal of enough stockholders to leave less
than a quorum.

      Section 7. Voting. The holders of a majority of the shares of stock of the
Corporation present in person or by proxy at an annual meeting at which a quorum
is present may, without the

                                       2


necessity for concurrence by the Board of Directors, vote to elect a director.
Each share may be voted for as many individuals as there are directors to be
elected and for whose election the share is entitled to be voted. A majority of
the votes cast at a meeting of stockholders duly called and at which a quorum is
present shall be sufficient to approve any other matter which may properly come
before the meeting, unless more than a majority of the votes cast is required by
statute or by the Charter. Unless otherwise provided by statute or by the
Charter, each outstanding share, regardless of class, shall be entitled to one
vote on each matter submitted to a vote at a meeting of stockholders. Voting on
any question or in any election may be viva voce unless the chairman of the
meeting shall order that voting be by ballot.

      Section 8. Proxies. A stockholder may cast the votes entitled to be cast
by the shares of stock owned of record by the stockholder in person or by proxy
executed by the stockholder or by the stockholder's duly authorized agent in any
manner permitted by law. Such proxy or evidence of authorization of such proxy
shall be filed with the secretary of the Corporation before or at the meeting.
No proxy shall be valid more than eleven months after its date unless otherwise
provided in the proxy.

      Section 9. Voting of Stock by Certain Holders. Stock of the Corporation
registered in the name of a corporation, partnership, trust or other entity, if
entitled to be voted, may be voted by the president or a vice president, a
general partner or trustee thereof, as the case may be, or a proxy appointed by
any of the foregoing individuals, unless some other person who has been
appointed to vote such stock pursuant to a bylaw or a resolution of the
governing body of such corporation or other entity or agreement of the partners
of a partnership presents a certified copy of such bylaw, resolution or
agreement, in which case such person may vote such stock. Any director or other
fiduciary may vote stock registered in his or her name as such fiduciary, either
in person or by proxy.

      Shares of stock of the Corporation directly or indirectly owned by it
shall not be voted at any meeting and shall not be counted in determining the
total number of outstanding shares entitled to be voted at any given time,
unless they are held by it in a fiduciary capacity, in which case they may be
voted and shall be counted in determining the total number of outstanding shares
at any given time.

      The Board of Directors may adopt by resolution a procedure by which a
stockholder may certify in writing to the Corporation that any shares of stock
registered in the name of the stockholder are held for the account of a
specified person other than the stockholder. The resolution shall set forth the
class of stockholders who may make the certification, the purpose for which the
certification may be made, the form of certification and the information to be
contained in it; if the certification is with respect to a record date or
closing of the stock transfer books, the time after the record date or closing
of the stock transfer books within which the certification must be received by
the Corporation; and any other provisions with respect to the procedure which
the Board of Directors considers necessary or desirable. On receipt of such
certification, the person specified in the certification shall be regarded as,
for the purposes set forth in the certification, the stockholder of record of
the specified stock in place of the stockholder who makes the certification.

      Section 10. Inspectors. The Board of Directors, in advance of any meeting,
may, but need not, appoint one or more individual inspectors or one or more
entities that designate individuals as inspectors to act at the meeting or any
adjournment thereof. If an inspector or inspectors are not appointed, the person
presiding at the meeting may, but need not, appoint one or more inspectors. In
case any person who may be appointed as an inspector fails to appear or act, the
vacancy may be filled by appointment made by the Board of Directors in advance
of the meeting or at the meeting by the chairman of the meeting. The inspectors,
if any, shall determine the number of shares outstanding and the voting power of
each, the shares represented at the meeting, the existence of a quorum, the
validity and effect of proxies, and shall receive votes, ballots or consents,
hear and determine all challenges and questions arising in connection with the
right to vote, count and tabulate all votes, ballots or consents, determine the

                                       3


result, and do such acts as are proper to conduct the election or vote with
fairness to all stockholders. Each such report shall be in writing and signed by
him or her or by a majority of them if there is more than one inspector acting
at such meeting. If there is more than one inspector, the report of a majority
shall be the report of the inspectors. The report of the inspector or inspectors
on the number of shares represented at the meeting and the results of the voting
shall be prima facie evidence thereof.

      Section 11. Advance Notice of Stockholder Nominees for Director and Other
Stockholder Proposals.

            (a) Annual Meetings of Stockholders.

                  (1)   Nominations of individuals for election to the Board of
                        Directors and the proposal of other business to be
                        considered by the stockholders may be made at an annual
                        meeting of stockholders (i) pursuant to the
                        Corporation's notice of meeting, (ii) by or at the
                        direction of the Board of Directors or (iii) by any
                        stockholder of the Corporation who was a stockholder of
                        record both at the time of giving of notice by the
                        stockholder as provided for in this Section 11(a) and at
                        the time of the annual meeting, who is entitled to vote
                        at the meeting and who has complied with this Section
                        11(a).

                  (2)   For nominations or other business to be properly brought
                        before an annual meeting by a stockholder pursuant to
                        clause (iii) of paragraph (a)(1) of this Section 11, the
                        stockholder must have given timely notice thereof in
                        writing to the secretary of the Corporation and such
                        other business must otherwise be a proper matter for
                        action by the stockholders. To be timely, a
                        stockholder's notice shall set forth all information
                        required under this Section 11 and shall be delivered to
                        the secretary at the principal executive office of the
                        Corporation not earlier than the 150th day nor later
                        than 5:00 p.m., New York City Time, on the 120th day
                        prior to the first anniversary of the date of mailing of
                        the notice for the preceding year's annual meeting;
                        provided, however, that in the event that the date of
                        the annual meeting is advanced or delayed by more than
                        30 days from the first anniversary of the date of the
                        preceding year's annual meeting, notice by the
                        stockholder to be timely must be so delivered not
                        earlier than the 150th day prior to the date of such
                        annual meeting and not later than 5:00 p.m., New York
                        City Time, on the later of the 120th day prior to the
                        date of such annual meeting or the tenth day following
                        the day on which public announcement of the date of such
                        meeting is first made. The public announcement of a
                        postponement or adjournment of an annual meeting shall
                        not commence a new time period for the giving of a
                        stockholder's notice as described above. Such
                        stockholder's notice shall set forth (i) as to each
                        individual whom the stockholder proposes to nominate for
                        election or reelection as a director, (A) the name, age,
                        business address and residence address of such
                        individual, (B) the class, series and number of any
                        shares of stock of the Corporation that are beneficially
                        owned by such individual, (C) the date such shares were
                        acquired and the investment intent of such acquisition
                        and (D) all other information relating to such
                        individual that is required to be disclosed in
                        solicitations of proxies for election of directors in an
                        election contest (even if an election contest is not
                        involved), or is

                                       4


                        otherwise required, in each case pursuant to Regulation
                        14A (or any successor provision) under the Securities
                        Exchange Act of 1934, as amended (the "Exchange Act"),
                        and the rules thereunder (including such individual's
                        written consent to being named in the proxy statement as
                        a nominee and to serving as a director if elected); (ii)
                        as to any other business that the stockholder proposes
                        to bring before the meeting, a description of such
                        business, the reasons for proposing such business at the
                        meeting and any material interest in such business of
                        such stockholder and any Stockholder Associated Person
                        (as defined below), individually or in the aggregate,
                        including any anticipated benefit to the stockholder and
                        the Stockholder Associated Person therefrom; (iii) as to
                        the stockholder giving the notice and any Stockholder
                        Associated Person, the class, series and number of all
                        shares of stock of the Corporation which are owned by
                        such stockholder and by such Stockholder Associated
                        Person, if any, and the nominee holder for, and number
                        of, shares owned beneficially but not of record by such
                        stockholder and by any such Stockholder Associated
                        Person; (iv) as to the stockholder giving the notice and
                        any Stockholder Associated Person covered by clauses
                        (ii) or (iii) of this paragraph (2) of this Section
                        11(a), the name and address of such stockholder, as they
                        appear on the Corporation's stock ledger and current
                        name and address, if different, and of such Stockholder
                        Associated Person; and (v) to the extent known by the
                        stockholder giving the notice, the name and address of
                        any other stockholder supporting the nominee for
                        election or reelection as a director or the proposal of
                        other business on the date of such stockholder's notice.

                  (3)   Notwithstanding anything in this subsection (a) of this
                        Section 11 to the contrary, in the event the Board of
                        Directors increases or decreases the maximum or minimum
                        number of directors in accordance with Article III,
                        Section 2 of these Bylaws, and there is no public
                        announcement of such action at least 130 days prior to
                        the first anniversary of the date of mailing of the
                        notice of the preceding year's annual meeting, a
                        stockholder's notice required by this Section 11(a)
                        shall also be considered timely, but only with respect
                        to nominees for any new positions created by such
                        increase, if it shall be delivered to the secretary at
                        the principal executive office of the Corporation not
                        later than 5:00 p.m., New York City Time, on the tenth
                        day following the day on which such public announcement
                        is first made by the Corporation.

                  (4)   For purposes of this Section 11, "Stockholder Associated
                        Person" of any stockholder shall mean (i) any person
                        controlling, directly or indirectly, or acting in
                        concert with, such stockholder, (ii) any beneficial
                        owner of shares of stock of the Corporation owned of
                        record or beneficially by such stockholder and (iii) any
                        person controlling, controlled by or under common
                        control with such Stockholder Associated Person.

            (b) Special Meetings of Stockholders. Only such business shall be
      conducted at a special meeting of stockholders as shall have been brought
      before the meeting pursuant to the Corporation's notice of meeting.
      Nominations of individuals for election to the Board of Directors may be
      made at a special meeting of stockholders at which directors are to be
      elected

                                       5


      (i) pursuant to the Corporation's notice of meeting, (ii) by or at the
      direction of the Board of Directors or (iii) provided that the Board of
      Directors has determined that directors shall be elected at such special
      meeting, by any stockholder of the Corporation who is a stockholder of
      record both at the time of giving of notice provided for in this Section
      11 and at the time of the special meeting, who is entitled to vote at the
      meeting and who complied with the notice procedures set forth in this
      Section 11. In the event the Corporation calls a special meeting of
      stockholders for the purpose of electing one or more individuals to the
      Board of Directors, any such stockholder may nominate an individual or
      individuals (as the case may be) for election as a director as specified
      in the Corporation's notice of meeting, if the stockholder's notice
      required by paragraph (2) of this Section 11(a) shall be delivered to the
      secretary at the principal executive office of the Corporation not earlier
      than the 150th day prior to such special meeting and not later than 5:00
      p.m., New York City Time on the later of the 120th day prior to such
      special meeting or the tenth day following the day on which public
      announcement is first made of the date of the special meeting and of the
      nominees proposed by the Board of Directors to be elected at such meeting.
      The public announcement of a postponement or adjournment of a special
      meeting shall not commence a new time period for the giving of a
      stockholder's notice as described above.

            (c) General.

                  (1)   Upon written request by the secretary or the Board of
                        Directors or any committee thereof, any stockholder
                        proposing a nominee for election as a director or any
                        proposal for other business at a meeting of stockholders
                        shall provide, within five Business Days of delivery of
                        such request (or such other period as may be specified
                        in such request), written verification, satisfactory, in
                        the discretion of the Board of Directors or any
                        committee thereof or any authorized officer of the
                        Corporation, to demonstrate the accuracy of any
                        information submitted by the stockholder pursuant to
                        this Section 11. If a stockholder fails to provide such
                        written verification within such period, the information
                        as to which written verification was requested may be
                        deemed not to have been provided in accordance with this
                        Section 11.

                  (2)   Only such individuals who are nominated in accordance
                        with this Section 11 shall be eligible for election by
                        stockholders as directors, and only such business shall
                        be conducted at a meeting of stockholders as shall have
                        been brought before the meeting in accordance with this
                        Section 11. The chairman of the meeting shall have the
                        power to determine whether a nomination or any other
                        business proposed to be brought before the meeting was
                        made or proposed, as the case may be, in accordance with
                        this Section 11.

                  (3)   For purposes of this Section 11, (a) the "date of
                        mailing of the notice" shall mean the date of the proxy
                        statement for the solicitation of proxies for election
                        of directors and (b) "public announcement" shall mean
                        disclosure (i) in a press release reported by the Dow
                        Jones News Service, Associated Press, Business Wire, PR
                        Newswire or comparable news service or (ii) in a
                        document publicly filed by the Corporation with the
                        Securities and Exchange Commission pursuant to the
                        Exchange Act.

                  (4)   Notwithstanding the foregoing provisions of this Section
                        11, a stockholder shall also comply with all applicable
                        requirements of state

                                       6


                        law and of the Exchange Act and the rules and
                        regulations thereunder with respect to the matters set
                        forth in this Section 11. Nothing in this Section 11
                        shall be deemed to affect any right of a stockholder to
                        request inclusion of a proposal in, nor the right of the
                        Corporation to omit a proposal from, the Corporation's
                        proxy statement pursuant to Rule 14a-8 (or any successor
                        provision) under the Exchange Act.

      Section 12. Control Share Acquisition Act. Notwithstanding any other
provision of the Charter or these Bylaws, Title 3, Subtitle 7 of the Maryland
General Corporation Law (the "MGCL") (or any successor statute) shall not apply
to any acquisition by any person of shares of stock of the Corporation. This
section may be repealed, in whole or in part, at any time, whether before or
after an acquisition of control shares and, upon such repeal, may, to the extent
provided by any successor bylaw, apply to any prior or subsequent control share
acquisition.

                                   ARTICLE III

                                    DIRECTORS

      Section 1. General Powers. The business and affairs of the Corporation
shall be managed under the direction of its Board of Directors.

      Section 2. Number, Tenure and Qualifications. At any regular meeting or at
any special meeting called for that purpose, a majority of the entire Board of
Directors may establish, increase or decrease the number of directors, provided
that the number thereof shall never be less than three, nor more than 15, and
further provided that the tenure of office of a director shall not be affected
by any decrease in the number of directors.

      Section 3. Annual and Regular Meetings. An annual meeting of the Board of
Directors shall be held immediately after and at the same place as the annual
meeting of stockholders, no notice other than this Bylaw being necessary. In the
event such meeting is not so held, the meeting may be held at such time and
place as shall be specified in a notice given as hereinafter provided for
special meetings of the Board of Directors. The Board of Directors may provide,
by resolution, the time and place for the holding of regular meetings of the
Board of Directors without other notice than such resolution.

      Section 4. Special Meetings. Special meetings of the Board of Directors
may be called by or at the request of the chairman of the board, the chief
executive officer, the president or by a majority of the directors then in
office. The person or persons authorized to call special meetings of the Board
of Directors may fix any place as the place for holding any special meeting of
the Board of Directors called by them. The Board of Directors may provide, by
resolution, the time and place for the holding of special meetings of the Board
of Directors without other notice than such resolution.

      Section 5. Notice. Notice of any special meeting of the Board of Directors
shall be delivered personally or by telephone, electronic mail, facsimile
transmission, United States mail or courier to each director at his or her
business or residence address. Notice by personal delivery, telephone,
electronic mail or facsimile transmission shall be given at least 24 hours prior
to the meeting. Notice by United States mail shall be given at least three days
prior to the meeting. Notice by courier shall be given at least two days prior
to the meeting. Telephone notice shall be deemed to be given when the director
or his or her agent is personally given such notice in a telephone call to which
the director or his or her agent is a party. Electronic mail notice shall be
deemed to be given upon transmission of the message to the electronic mail
address given to the Corporation by the director. Facsimile transmission notice
shall be deemed to be given upon completion of the transmission of the message
to the number

                                       7


given to the Corporation by the director and receipt of a completed answer-back
indicating receipt. Notice by United States mail shall be deemed to be given
when deposited in the United States mail properly addressed, with postage
thereon prepaid. Notice by courier shall be deemed to be given when deposited
with or delivered to a courier properly addressed. Neither the business to be
transacted at, nor the purpose of, any annual, regular or special meeting of the
Board of Directors need be stated in the notice, unless specifically required by
statute or these Bylaws.

      Section 6. Quorum. A majority of the directors shall constitute a quorum
for transaction of business at any meeting of the Board of Directors, provided
that, if less than a majority of such directors are present at said meeting, a
majority of the directors present may adjourn the meeting from time to time
without further notice, and provided further that if, pursuant to applicable
law, the Charter or these Bylaws, the vote of a majority of a particular group
of directors is required for action, a quorum must also include a majority of
such group.

      The directors present at a meeting which has been duly called and convened
may continue to transact business until adjournment, notwithstanding the
withdrawal of enough directors to leave less than a quorum.

      Section 7. Voting. The action of the majority of the directors present at
a meeting at which a quorum is present shall be the action of the Board of
Directors, unless the concurrence of a greater proportion is required for such
action by applicable law, the Charter or these Bylaws; provided, however, that
any action pertaining to any transaction in which the Corporation is purchasing,
selling, leasing or mortgaging any real estate asset, making a joint venture
investment or engaging in any other transaction in which an advisor, director or
officer of the Corporation, any affiliated lessee or affiliated contract manager
of any property of the Corporation or any affiliate of the foregoing has any
direct or indirect interest other than as a result of their status as a
director, officer or stockholder of the Corporation shall be approved by the
affirmative vote of a majority of the Independent Directors, even if the
Independent Directors constitute less than a quorum. If enough directors have
withdrawn from a meeting to leave less than a quorum but the meeting is not
adjourned, the action of the majority of that number of directors necessary to
constitute a quorum at such meeting shall be the action of the Board of
Directors, unless the concurrence of a greater proportion is required for such
action by applicable law, the Charter or these Bylaws.

      Section 8. Organization. At each meeting of the Board of Directors, the
chairman of the board or, in the absence of the chairman, the vice chairman of
the board, if any, shall act as chairman of the meeting. In the absence of both
the chairman and vice chairman of the board, the chief executive officer or in
the absence of the chief executive officer, the president or in the absence of
the president, a director chosen by a majority of the directors present, shall
act as chairman of the meeting. The secretary or, in his or her absence, an
assistant secretary of the Corporation, or in the absence of the secretary and
all assistant secretaries, a person appointed by the Chairman, shall act as
secretary of the meeting.

      Section 9. Telephone Meetings. Directors may participate in a meeting by
means of a conference telephone or other communications equipment if all persons
participating in the meeting can hear each other at the same time. Participation
in a meeting by these means shall constitute presence in person at the meeting.

      Section 10. Consent by Directors Without a Meeting. Any action required or
permitted to be taken at any meeting of the Board of Directors may be taken
without a meeting, if a consent in writing or by electronic transmission to such
action is given by each director and is filed with the minutes of proceedings of
the Board of Directors.

                                       8


      Section 11. Vacancies. If for any reason any or all the directors cease to
be directors, such event shall not terminate the Corporation or affect these
Bylaws or the powers of the remaining directors hereunder (even if fewer than
three directors remain). Except as may be provided by the Board of Directors in
setting the terms of any class or series of stock, any vacancy on the Board of
Directors may be filled only by a majority of the remaining directors, even if
the remaining directors do not constitute a quorum. Independent Directors shall
nominate replacements for vacancies among the Independent Directors' positions.
Any director elected to fill a vacancy shall serve for the remainder of the full
term of the directorship in which the vacancy occurred and until a successor is
elected and qualifies.

      Section 12. Compensation. Directors shall not receive any stated salary
for their services as directors but, by resolution of the Board of Directors,
may receive compensation per year and/or per meeting and/or per visit to real
property or other facilities owned or leased by the Corporation and for any
service or activity they performed or engaged in as directors. Directors may be
reimbursed for expenses of attendance, if any, at each annual, regular or
special meeting of the Board of Directors or of any committee thereof and for
their expenses, if any, in connection with each property visit and any other
service or activity they performed or engaged in as directors; but nothing
herein contained shall be construed to preclude any directors from serving the
Corporation in any other capacity and receiving compensation therefor.

      Section 13. Loss of Deposits. No director shall be liable for any loss
which may occur by reason of the failure of the bank, trust company, savings and
loan association, or other institution with whom moneys or stock have been
deposited.

      Section 14. Surety Bonds. Unless required by law, no director shall be
obligated to give any bond or surety or other security for the performance of
any of his or her duties.

      Section 15. Reliance. Each director, officer, employee and agent of the
Corporation shall, in the performance of his or her duties with respect to the
Corporation, be fully justified and protected with regard to any act or failure
to act in reliance in good faith upon the books of account or other records of
the Corporation, upon an opinion of counsel or upon reports made to the
Corporation by any of its officers or employees or by the adviser, accountants,
appraisers or other experts or consultants selected by the Board of Directors or
officers of the Corporation, regardless of whether such counsel or expert may
also be a director.

      Section 16. Certain Rights of Directors, Officers, Employees and Agents.
The directors shall have no responsibility to devote their full time to the
affairs of the Corporation. Any director or officer, employee or agent of the
Corporation, in his or her personal capacity or in a capacity as an affiliate,
employee, or agent of any other person, or otherwise, may have business
interests and engage in business activities similar to, in addition to or in
competition with those of or relating to the Corporation.

                                   ARTICLE IV

                                   COMMITTEES

      Section 1. Number, Tenure and Qualifications. The Board of Directors may
appoint from among its members committees, composed of one or more directors, to
serve at the pleasure of the Board of Directors. The majority of the members of
each committee shall be Independent Directors.

      Section 2. Powers. The Board of Directors may delegate to committees
appointed under Section 1 of this Article any of the powers of the Board of
Directors, except as prohibited by law.

                                       9


      Section 3. Meetings. Notice of committee meetings shall be given in the
same manner as notice for special meetings of the Board of Directors. A majority
of the members of the committee shall constitute a quorum for the transaction of
business at any meeting of the committee. The act of a majority of the committee
members present at a meeting shall be the act of such committee. The Board of
Directors may designate a chairman of any committee, and such chairman or, in
the absence of a chairman, any two members of any committee (if there are at
least two members of the Committee) may fix the time and place of its meeting
unless the Board shall otherwise provide. In the absence of any member of any
such committee, the members thereof present at any meeting, whether or not they
constitute a quorum, may appoint another director to act in the place of such
absent member. Each committee shall keep minutes of its proceedings.

      Section 4. Telephone Meetings. Members of a committee of the Board of
Directors may participate in a meeting by means of a conference telephone or
other communications equipment if all persons participating in the meeting can
hear each other at the same time. Participation in a meeting by these means
shall constitute presence in person at the meeting.

      Section 5. Consent by Committees Without a Meeting. Any action required or
permitted to be taken at any meeting of a committee of the Board of Directors
may be taken without a meeting, if a consent in writing or by electronic
transmission to such action is given by each member of the committee and is
filed with the minutes of proceedings of such committee.

      Section 6. Vacancies. Subject to the provisions hereof, the Board of
Directors shall have the power at any time to change the membership of any
committee, to fill all vacancies, to designate alternate members to replace any
absent or disqualified member or to dissolve any such committee.

                                   ARTICLE V

                                    OFFICERS

      Section 1. General Provisions. The officers of the Corporation shall
include a president, a secretary and a treasurer and may include a chairman of
the board, a vice chairman of the board, a chief executive officer, one or more
vice presidents, a chief operating officer, a chief financial officer, one or
more assistant secretaries and one or more assistant treasurers. In addition,
the Board of Directors may from time to time elect such other officers with such
powers and duties as they shall deem necessary or desirable. The officers of the
Corporation shall be elected annually by the Board of Directors, except that the
chief executive officer or president may from time to time appoint one or more
vice presidents, assistant secretaries and assistant treasurers or other
officers. Each officer shall hold office until his or her successor is elected
and qualifies or until his or her death, or his or her resignation or removal in
the manner hereinafter provided. Any two or more offices except president and
vice president may be held by the same person. Election of an officer or agent
shall not of itself create contract rights between the Corporation and such
officer or agent.

      Section 2. Removal and Resignation. Any officer or agent of the
Corporation may be removed, with or without cause, by the Board of Directors if
in its judgment the best interests of the Corporation would be served thereby,
but such removal shall be without prejudice to the contract rights, if any, of
the person so removed. Any officer, other than an executive officer, subordinate
to the chief executive officer or the president may be removed by either the
chief executive officer or the president with or without cause. Any officer of
the Corporation may resign at any time by giving written notice of his or her
resignation to the Board of Directors, the chairman of the board, the president
or the secretary. Any resignation shall take effect immediately upon its receipt
or at such later time specified in the notice of resignation. The acceptance of
a resignation shall not be necessary to make it effective unless

                                       10


otherwise stated in the resignation. Such resignation shall be without prejudice
to the contract rights, if any, of the Corporation.

      Section 3. Vacancies. A vacancy in any office may be filled by the Board
of Directors for the balance of the term.

      Section 4. Chief Executive Officer. The Board of Directors may designate a
chief executive officer. In the absence of such designation, the chairman of the
board shall be the chief executive officer of the Corporation. The chief
executive officer shall have general responsibility for implementation of the
policies of the Corporation, as determined by the Board of Directors, and for
the management of the business and affairs of the Corporation. He or she may
execute any deed, mortgage, bond, contract or other instrument, except in cases
where the execution thereof shall be expressly delegated by the Board of
Directors or by these Bylaws to some other officer or agent of the Corporation
or shall be required by law to be otherwise executed; and in general shall
perform all duties incident to the office of chief executive officer and such
other duties as may be prescribed by the Board of Directors from time to time.

      Section 5. Chief Operating Officer. The Board of Directors may designate a
chief operating officer. The chief operating officer shall have the
responsibilities and duties as set forth by the Board of Directors or the chief
executive officer.

      Section 6. Chief Financial Officer. The Board of Directors may designate a
chief financial officer. The chief financial officer shall have the
responsibilities and duties as set forth by the Board of Directors or the chief
executive officer.

      Section 7. Chairman of the Board. The Board of Directors shall designate a
chairman of the board. The chairman of the board shall preside over the meetings
of the Board of Directors and of the stockholders at which he or she shall be
present. The chairman of the board shall perform such other duties as may be
assigned to him or her by the Board of Directors.

      Section 8. President. In the absence of a chief executive officer, the
president shall in general supervise and control all of the business and affairs
of the Corporation. In the absence of a designation of a chief operating officer
by the Board of Directors, the president shall be the chief operating officer.
He or she may execute any deed, mortgage, bond, contract or other instrument,
except in cases where the execution thereof shall be expressly delegated by the
Board of Directors or by these Bylaws to some other officer or agent of the
Corporation or shall be required by law to be otherwise executed; and in general
shall perform all duties incident to the office of president and such other
duties as may be prescribed by the Board of Directors from time to time.

      Section 9. Vice Presidents. In the absence of the president or in the
event of a vacancy in such office, the vice president (or in the event there be
more than one vice president, the vice presidents in the order designated at the
time of their election or, in the absence of any designation, then in the order
of their election) shall perform the duties of the president and when so acting
shall have all the powers of and be subject to all the restrictions upon the
president; and shall perform such other duties as from time to time may be
assigned to such vice president by the president or by the Board of Directors.
The Board of Directors may designate one or more vice presidents as executive
vice president, senior vice president, or as vice president for particular areas
of responsibility.

      Section 10. Secretary. The secretary shall (a) keep the minutes of the
proceedings of the stockholders, the Board of Directors and committees of the
Board of Directors in one or more books provided for that purpose; (b) see that
all notices are duly given in accordance with the provisions of these Bylaws or
as required by law; (c) be custodian of the corporate records and of the seal of
the Corporation;

                                       11


(d) keep a register of the post office address of each stockholder which shall
be furnished to the secretary by such stockholder; (e) have general charge of
the stock transfer books of the Corporation; and (f) in general perform such
other duties as from time to time may be assigned to him or her by the chief
executive officer, the president or by the Board of Directors.

      Section 11. Treasurer. The treasurer shall have the custody of the funds
and securities of the Corporation and shall keep full and accurate accounts of
receipts and disbursements in books belonging to the Corporation and shall
deposit all moneys and other valuable effects in the name and to the credit of
the Corporation in such depositories as may be designated by the Board of
Directors. In the absence of a designation of a chief financial officer by the
Board of Directors, the treasurer shall be the chief financial officer of the
Corporation.

      The treasurer shall disburse the funds of the Corporation as may be
ordered by the Board of Directors, taking proper vouchers for such
disbursements, and shall render to the president and Board of Directors, at the
regular meetings of the Board of Directors or whenever it may so require, an
account of all his or her transactions as treasurer and of the financial
condition of the Corporation.

      If required by the Board of Directors, the treasurer shall give the
Corporation a bond in such sum and with such surety or sureties as shall be
satisfactory to the Board of Directors for the faithful performance of the
duties of his or her office and for the restoration to the Corporation, in case
of his or her death, resignation, retirement or removal from office, of all
books, papers, vouchers, moneys and other property of whatever kind in his or
her possession or under his or her control belonging to the Corporation.

      Section 12. Assistant Secretaries and Assistant Treasurers. The assistant
secretaries and assistant treasurers, in general, shall perform such duties as
shall be assigned to them by the secretary or treasurer, respectively, or by the
president or the Board of Directors. The assistant treasurers shall, if required
by the Board of Directors, give bonds for the faithful performance of their
duties in such sums and with such surety or sureties as shall be satisfactory to
the Board of Directors.

      Section 13. Salaries. The salaries and other compensation of the officers
shall be fixed from time to time by the Board of Directors and no officer shall
be prevented from receiving such salary or other compensation by reason of the
fact that he or she is also a director.

                                   ARTICLE VI

                      CONTRACTS, LOANS, CHECKS AND DEPOSITS

      Section 1. Contracts. The Board of Directors or any committee of the Board
of Directors within the scope of its delegated authority may authorize any
officer or agent to enter into any contract or to execute and deliver any
instrument in the name of and on behalf of the Corporation and such authority
may be general or confined to specific instances. Any agreement, deed, mortgage,
lease or other document shall be valid and binding upon the Corporation when
duly authorized or ratified by action of the Board of Directors or such
committee and executed by an authorized person.

      Section 2. Checks and Drafts. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the Corporation shall be signed by such officer or agent of the Corporation in
such manner as shall from time to time be determined by the Board of Directors.

                                       12


      Section 3. Deposits. All funds of the Corporation not otherwise employed
shall be deposited from time to time to the credit of the Corporation in such
banks, trust companies or other depositories as the Board of Directors may
designate.

                                  ARTICLE VII

                                      STOCK

      Section 1. Certificates; Required Information. Except as may be otherwise
provided by the Board of Directors or required by the Charter, stockholders of
the Corporation are not entitled to certificates representing the shares of
stock held by them. In the event that the Corporation issues shares of stock
represented by certificates, such certificates shall be signed by the officers
of the Corporation in the manner permitted by the MGCL and contain the
statements and information required by the MGCL. In the event that the
Corporation issues shares of stock without certificates, the Corporation shall
provide to record holders of such shares, on request and without charge, a
written statement of the information required by the MGCL to be included on
stock certificates.

      Section 2. Transfers When Certificates Issued. Upon surrender to the
Corporation or the transfer agent of the Corporation of a stock certificate duly
endorsed or accompanied by proper evidence of succession, assignment or
authority to transfer, the Corporation shall issue a new certificate to the
person entitled thereto, cancel the old certificate and record the transaction
upon its books.

      The Corporation shall be entitled to treat the holder of record of any
share of stock as the holder in fact thereof and, accordingly, shall not be
bound to recognize any equitable or other claim to or interest in such share or
on the part of any other person, whether or not it shall have express or other
notice thereof, except as otherwise provided by the laws of the State of
Maryland.

      Notwithstanding the foregoing, transfers of shares of any class of stock
will be subject in all respects to the Charter and all of the terms and
conditions contained therein.

      Section 3. Replacement Certificate. Any officer designated by the Board of
Directors may direct a new certificate to be issued in place of any certificate
previously issued by the Corporation alleged to have been lost, stolen or
destroyed upon the making of an affidavit of that fact by the person claiming
the certificate to be lost, stolen or destroyed. When authorizing the issuance
of a new certificate, an officer designated by the Board of Directors may, in
his or her discretion and as a condition precedent to the issuance thereof,
require the owner of such lost, stolen or destroyed certificate or the owner's
legal representative to advertise the same in such manner as he or she shall
require and/or to give bond, with sufficient surety, to the Corporation to
indemnify it against any loss or claim which may arise as a result of the
issuance of a new certificate.

      Section 4. Closing of Transfer Books or Fixing of Record Date. The Board
of Directors may set, in advance, a record date for the purpose of determining
stockholders entitled to notice of or to vote at any meeting of stockholders or
determining stockholders entitled to receive payment of any dividend or the
allotment of any other rights, or in order to make a determination of
stockholders for any other proper purpose. Such date, in any case, shall not be
prior to the close of business on the day the record date is fixed and shall be
not more than 90 days and, in the case of a meeting of stockholders, not less
than ten days, before the date on which the meeting or particular action
requiring such determination of stockholders of record is to be held or taken.

      In lieu of fixing a record date, the Board of Directors may provide that
the stock transfer books shall be closed for

                                       13


a stated period but not longer than 20 days. If the stock transfer books are
closed for the purpose of determining stockholders entitled to notice of or to
vote at a meeting of stockholders, such books shall be closed for at least ten
days before the date of such meeting.

      If no record date is fixed and the stock transfer books are not closed for
the determination of stockholders, (a) the record date for the determination of
stockholders entitled to notice of or to vote at a meeting of stockholders shall
be at the close of business on the day on which the notice of meeting is mailed
or the 30th day before the meeting, whichever is the closer date to the meeting;
and (b) the record date for the determination of stockholders entitled to
receive payment of a dividend or an allotment of any other rights shall be the
close of business on the day on which the resolution of the directors, declaring
the dividend or allotment of rights, is adopted.

      When a determination of stockholders entitled to vote at any meeting of
stockholders has been made as provided in this section, such determination shall
apply to any adjournment thereof, except when (i) the determination has been
made through the closing of the transfer books and the stated period of closing
has expired or (ii) the meeting is adjourned to a date more than 120 days after
the record date fixed for the original meeting, in either of which case a new
record date shall be determined as set forth herein.

      Section 5. Stock Ledger. The Corporation shall maintain at its principal
office or at the office of its counsel, accountants or transfer agent, an
original or duplicate share ledger containing the name and address of each
stockholder and the number of shares of each class held by such stockholder.

      Section 6. Fractional Stock; Issuance of Units. The Board of Directors may
issue fractional stock or provide for the issuance of scrip, all on such terms
and under such conditions as they may determine. Notwithstanding any other
provision of the Charter or these Bylaws, the Board of Directors may issue units
consisting of different securities of the Corporation. Any security issued in a
unit shall have the same characteristics as any identical securities issued by
the Corporation, except that the Board of Directors may provide that for a
specified period securities of the Corporation issued in such unit may be
transferred on the books of the Corporation only in such unit.

                                  ARTICLE VIII

                                 ACCOUNTING YEAR

      The Board of Directors shall have the power, from time to time, to fix the
fiscal year of the Corporation by a duly adopted resolution.

                                   ARTICLE IX

                                  DISTRIBUTIONS

      Section 1. Authorization. Dividends and other distributions upon the stock
of the Corporation may be authorized by the Board of Directors and declared by
the Corporation, subject to the provisions of law and the Charter. Dividends and
other distributions may be paid in cash, property or stock of the Corporation,
subject to the provisions of law and the Charter.

      Section 2. Contingencies. Before payment of any dividends or other
distributions, there may be set aside out of any assets of the Corporation
available for dividends or other distributions such sum or sums as the Board of
Directors may from time to time, in its absolute discretion, think proper as a
reserve fund for contingencies, for equalizing dividends or other distributions,
for repairing or maintaining any property of the Corporation or for such other
purpose as the Board of Directors shall

                                       14


determine to be in the best interest of the Corporation, and the Board of
Directors may modify or abolish any such reserve.

                                   ARTICLE X

                                INVESTMENT POLICY

      Subject to the provisions of the Charter, the Board of Directors may from
time to time adopt, amend, revise or terminate any policy or policies with
respect to investments by the Corporation as it shall deem appropriate in its
sole discretion.

                                   ARTICLE XI

                                      SEAL

      Section 1. Seal. The Board of Directors may authorize the adoption of a
seal by the Corporation. The seal shall contain the name of the Corporation and
the year of its incorporation and the words "Incorporated Maryland." The Board
of Directors may authorize one or more duplicate seals and provide for the
custody thereof.

      Section 2. Affixing Seal. Whenever the Corporation is permitted or
required to affix its seal to a document, it shall be sufficient to meet the
requirements of any law, rule or regulation relating to a seal to place the word
"(SEAL)" adjacent to the signature of the person authorized to execute the
document on behalf of the Corporation.

                                  ARTICLE XII

                                WAIVER OF NOTICE

      Whenever any notice is required to be given pursuant to the Charter or
these Bylaws or pursuant to applicable law, a waiver thereof in writing, signed
by the person or persons entitled to such notice, whether before or after the
time stated therein, shall be deemed equivalent to the giving of such notice.
Neither the business to be transacted at nor the purpose of any meeting need be
set forth in the waiver of notice, unless specifically required by statute. The
attendance of any person at any meeting shall constitute a waiver of notice of
such meeting, except where such person attends a meeting for the express purpose
of objecting to the transaction of any business on the ground that the meeting
is not lawfully called or convened.

                                  ARTICLE XIII

                               AMENDMENT OF BYLAWS

      The Board of Directors shall have the exclusive power to adopt, alter or
repeal any provision of these Bylaws and to make new Bylaws.

                                       15

EX-4.1

                                                                     EXHIBIT 4.1

             CORPORATE PROPERTY ASSOCIATES 17 -- GLOBAL INCORPORATED

                         2007 DISTRIBUTION REINVESTMENT
                             AND STOCK PURCHASE PLAN

     1. Participation; Agent. Corporate Property Associates 17 -- Global
Incorporated 2007 Distribution Reinvestment and Stock Purchase Plan ("Plan") is
available to stockholders of record of the common stock ("Common Stock") of
Corporate Property Associates 17 -- Global Incorporated ("CPA(R) :17 -- Global"
or the "Company"). Phoenix American Financial Services, Inc. ("Phoenix
American") acting as agent for each participant in the Plan, will apply cash
distributions which become payable to such participant on shares of CPA(R) :17 -
Global Common Stock (including shares held in the participant's name and shares
accumulated under the Plan), to the purchase of additional whole and fractional
shares of CPA(R) :17 -- Global Common Stock for such participant.

     2. Eligibility. Participation in the Plan is limited to registered owners
of CPA(R) :17 - Global Common Stock. Shares held by a broker-dealer or nominee
must be transferred to ownership in the name of the stockholder in order to be
eligible for this Plan. Further, a stockholder who wishes to participate in the
Plan may purchase shares through the Plan only after receipt of a prospectus
relating to the Plan, which prospectus may also relate to a concurrent public
offering of shares by CPA(R) :17 -- Global. CPA(R) :17 -- Global's board of
directors' (the "Board") reserves the right to amend the Plan in the future to
permit voluntary cash investments in Common Stock pursuant to the Plan. A
participating stockholder is not required to include all of the shares owned by
such stockholder in the Plan, but all of the distributions paid on enrolled
shares will be reinvested.

     3. Stock Purchases. In making purchases for the accounts of participants,
Phoenix American may commingle the funds of one participant with those of other
participants in the Plan. All shares purchased under the Plan will be held in
the name of each participant. Purchase will be made directly from CPA(R) :17 --
Global at 95% of the estimated net asset value ("NAV") per share of CPA(R) :17
- -- Global Common Stock, as estimated by Carey Asset Management Corp. (the
"Advisor") or another firm CPA(R) :17 -- Global chooses for that purpose. During
the offering and until the first annual valuation of CPA(R) :17 -- Global's
assets is received, the purchase price will be $9.50 per share. Subsequent to
the time that we begin to receive annual valuations, the per share purchase
price will be 95% of the then current NAV. NAV is determined by adding the most
recent appraised value of the real estate owned by CPA(R) :17 -- Global to the
value of CPA(R) :17 - Global's other assets, subtracting the total amount of all
liabilities and dividing the difference by the total number of outstanding
shares. Phoenix American shall have no responsibilities with respect to the
market value of the CPA(R) :17 -- Global Common Stock acquired for participants
under the Plan.

     4. Timing of Purchases. Phoenix American will make every reasonable effort
to reinvest all distributions on the day the cash distribution is paid (except
where necessary to comply with applicable securities laws) by CPA(R) :17 --
Global. If, for any reason beyond the control of Phoenix American, reinvestment
of the distributions cannot be completed within 30 days after the applicable
distribution payment date, participants' funds held by Phoenix American will be
distributed to the participant.

     5. Account Statements. Following the completion of the purchase of shares
after each distribution, Phoenix American will provide to each participant an
account statement showing the cash distribution, the number of shares purchased
with the cash distribution and the year-to-date and cumulative cash
distributions paid.




     6. Expenses and Commissions. There will be no direct expenses to
participants for the administration of the Plan. Administrative fees associated
with the Plan will be paid by CPA(R) :17 - Global. In no event will any
discounts (including, without limitation, any discounts attributable to CPA(R)
:17 - Global's payment of brokerage commissions on behalf of the participants)
on shares exceed 5% of the fair market value of such purchased shares.

     7. Taxation of Distributions. The reinvestment of distributions does not
relieve the participant of any taxes which may be payable on such distributions.

     8. Stock Certificates. No stock certificates will be issued to a
participant.

     9. Voting of Shares. In connection with any matter requiring the vote of
CPA(R) :17 - Global stockholders, each participant will be entitled to vote all
of the whole shares held by the participant in the Plan. Fractional shares will
not be voted.

     10. Absence of Liability. Neither CPA(R) :17 -- Global nor Phoenix American
shall have any responsibility or liability as to the value of CPA(R) :17 --
Global's shares, any change in the value of, the shares acquired for any
participant's account, or the rate of return earned on, or the value of, the
interest-bearing accounts, if any, in which distributions are invested. Neither
CPA(R) :17 -- Global nor Phoenix American shall be liable for any act done in
good faith, or for any good faith omission to act, including, without
limitation, any claims of liability (a) arising out of the failure to terminate
a participant's participation in the Plan upon such participant's death prior to
the date of receipt of such notice, and (b) with respect to the time and prices
at which shares are purchased for a participant. NOTWITHSTANDING THE FOREGOING,
LIABILITY UNDER THE U.S. FEDERAL SECURITIES LAWS CANNOT BE WAIVED. Similarly,
CPA(R) :17 -- Global and Phoenix American have been advised that in the opinion
of certain state securities commissioners, indemnification is also considered
contrary to public policy and therefore unenforceable.

     11. Termination of Participation. A participant may terminate participation
in the Plan at any time by written instructions to that effect to Phoenix
American. To be effective on a distribution payment date, the notice of
termination and termination fee must be received by Phoenix American at least 15
days before that distribution payment date. Upon receipt of notice of
termination from the participant, Phoenix American may also terminate any
participant's account at any time in its discretion by notice in writing mailed
to the participant.

     12. Amendment, Supplement, Termination and Suspension of Plan. This Plan
may be amended, supplemented or terminated by CPA(R) :17 -- Global at any time
by the delivery of written notice to each participant at least 10 days prior to
the effective date of the amendment, supplement or termination. Any amendment or
supplement shall be effective as to the participant unless, prior to its
effective date, Phoenix American receives written notice of termination of the
participant's account. Amendment may include an appointment by CPA(R) :17 --
Global or Phoenix American with the approval of CPA(R) :17 -- Global of a
successor agent, in which event such successor shall have all of the rights and
obligations of Phoenix American under this Plan. CPA(R) :17 - Global may suspend
the Plan at any time without notice to the participants.

     13. Governing Law. This Plan and the Authorization Card signed by the
participant (which is deemed a part of this Plan) and the participant's account
shall be governed by and construed in accordance with the laws of the State of
Maryland provided that the foregoing choice of law shall not restrict the
application of any state's securities laws to the sale of shares to its
residents or within such state. This Agreement cannot be changed orally.


                                        2

EX-10.1

EXHIBIT 10.1

ADVISORY AGREEMENT

     THIS ADVISORY AGREEMENT, dated as of November 12, 2007, is among CORPORATE PROPERTY ASSOCIATES 17 – GLOBAL INCORPORATED, a Maryland corporation (“CPA: 17”), CPA: 17 LIMITED PARTNERSHIP, a Delaware limited partnership of which CPA: 17 is a general partner (the “Operating Partnership”), and CAREY ASSET MANAGEMENT CORP., a Delaware corporation and wholly-owned subsidiary of W. P. Carey & Co. LLC (the “Advisor”).

WITNESSETH:

     WHEREAS, CPA: 17 intends to qualify as a REIT (as defined below), and the Operating Partnership intends to qualify as a partnership, in each case for U.S. federal income tax purposes

     WHEREAS, CPA: 17 and its subsidiaries, including the Operating Partnership, desire to avail themselves of the experience, sources of information, advice and assistance of, and certain facilities available to, the Advisor and to have the Advisor undertake the duties and responsibilities hereinafter set forth, on behalf of, and subject to the supervision of the Board of Directors of CPA: 17, all as provided herein; and

     WHEREAS, the Advisor is willing to render such services, subject to the supervision of the Board of Directors, on the terms and conditions hereinafter set forth;

     NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements contained herein, the parties hereto agree as follows:

     1. Definitions. As used in this Agreement, the following terms have the definitions hereinafter indicated:

     “2%/25% Guidelines.” The requirement, as provided for in Section 13 hereof, that, in the 12-month period ending on the last day of any fiscal quarter, Operating Expenses not exceed the greater of two percent of Average Invested Assets during such 12-month period or 25% of CPA: 17’s Adjusted Net Income over the same 12-month period.

     “Acquisition Expenses.” To the extent not paid or to be paid by the seller, lessee, borrower or any other party involved in the transaction, those expenses, including but not limited to travel and communications expenses, the cost of appraisals, title insurance, nonrefundable option payments on Investments not acquired, legal fees and expenses, accounting fees and expenses and miscellaneous expenses, related to selection, acquisition and origination of Investments, whether or not a particular Investment ultimately is made. Acquisition Expenses shall not include Acquisition Fees.

     “Acquisition Fees.” The Initial Acquisition Fee and the Subordinated Acquisition Fee.

     “Adjusted Investor Capital.” As of any date, the Initial Investor Capital reduced by any Redemptions, other than Redemptions intended to qualify as a liquidity event for purposes of this Agreement, and by any other Distributions on or prior to such date determined by the Board to be from Cash from Sales and Financings.

     “Adjusted Net Income.” For any period, the total consolidated revenues recognized in such period by CPA: 17, less the total consolidated expenses of CPA: 17 recognized in such period, excluding additions to reserves for depreciation and amortization, bad debts or other similar non-cash reserves;

provided, however, that Adjusted Net Income for purposes of calculating total allowable Operating Expenses shall exclude any gain, losses or writedowns from the sale of CPA: 17’s assets.

     “Advisor.” Carey Asset Management Corp, a corporation organized under the laws of the State of Delaware and wholly-owned by W. P. Carey & Co. LLC.

     “Affiliate.” An Affiliate of another Person shall include any of the following: (i) any Person directly or indirectly owning, controlling, or holding, with power to vote ten percent or more of the outstanding voting securities of such other Person; (ii) any Person ten percent or more of whose outstanding voting securities are directly or indirectly owned, controlled, or held, with power to vote, by such other Person; (iii) any Person directly or indirectly controlling, controlled by, or under common control with such other Person; (iv) any executive officer, director, trustee or general partner of such other Person; or (v) any legal entity for which such Person acts as an executive officer, director, trustee or general partner.

     “Agreement.” This Advisory Agreement.

     “Appraised Value.” Value according to an appraisal made by an Independent Appraiser, which may take into consideration any factor deemed appropriate by such Independent Appraiser, including, but not limited to, the terms and conditions of any lease of a relevant property, the quality of any lessee’s, borrower’s or other counter-party’s credit and the conditions of the credit markets. The Appraised Value of a Property may be greater than the construction cost or the replacement cost of the Property.

     “Articles of Incorporation.” Articles of Incorporation of CPA: 17 under the General Corporation Law of Maryland, as amended from time to time, pursuant to which CPA: 17 is organized.

     “Asset Management Fee.” The Asset Management Fee as defined in Section 9(a) hereof.

     “Average Equity Value.” The equity portion of the aggregate purchase price paid by CPA: 17 for an Investment, provided that, if (1) a later Appraised Value is obtained for the Investment, that later Appraised Value, adjusted for other net assets and liabilities that have economic value and are associated with that Investment, shall become the basis for calculating the Average Equity Market Value of the Investment, and (2) for Investments in securities that CPA: 17 treats as available for sale under GAAP, the fair value of such securities as determined on a monthly basis as of the last day of each month or, if applicable, on the date the securities are disposed of, shall be the basis for calculating the Average Equity Market Value of such securities.

     “Average Invested Assets.” The average during any period of the aggregate book value of CPA: 17’s Investments, before deducting reserves for depreciation, bad debts, impairments, amortization and all other non-cash reserves, computed by taking the average of such values at the end of each month during such period.

     “Average Market Value.” The aggregate purchase price paid by CPA: 17 for an Investment, provided that, if a later Appraised Value is obtained for the Investment, that later Appraised Value, adjusted for other net assets and liabilities that have economic value and are associated with that Investment, shall become the Average Market Value for the Investment .

     “B Note.” A note representing a subordinated interest in a Loan secured by a first mortgage on a Property.

     “Board or Board of Directors.” The Board of Directors of CPA: 17.

2

     “Bylaws.” The bylaws of CPA: 17.

     “Cash from Financings.” Net cash proceeds realized by CPA: 17 from the financing of Investments or the refinancing of any indebtedness of CPA: 17.

     “Cash from Sales.” Net cash proceeds realized by CPA: 17 from the sale, exchange or other disposition of any of its Investments after deduction of all expenses incurred in connection therewith. Cash from Sales shall not include Cash from Financings.

     “Cash from Sales and Financings.” The total sum of Cash from Sales and Cash from Financings.

     “Cause.” With respect to the termination of this Agreement, fraud, criminal conduct, willful misconduct or willful or negligent breach of fiduciary duty by the Advisor that, in each case, is determined by a majority of the Independent Directors to be materially adverse to CPA: 17, or a breach of a material term or condition of this Agreement by the Advisor and the Advisor has not cured such breach within 30 days of written notice thereof or, in the case of any breach that cannot be cured within 30 days by reasonable effort, has not taken all necessary action within a reasonable time period to cure such breach.

     “Change of Control.” A change of control of CPA: 17 of a nature that would be required to be reported in response to the disclosure requirements of Schedule 14A of Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as enacted and in force on the date hereof, whether or not CPA: 17 is then subject to such reporting requirements; provided, however, that, without limitation, a Change of Control shall be deemed to have occurred if: (i) any “person” (within the meaning of Section 13(d) of the Exchange Act, as enacted and in force on the date hereof) is or becomes the “beneficial owner” (as that term is defined in Rule 13d-3, as enacted and in force on the date hereof, under the Exchange Act) of securities of CPA: 17 representing 8.5% or more of the combined voting power of CPA: 17’s securities then outstanding; (ii) there occurs a merger, consolidation or other reorganization of CPA: 17 which is not approved by the Board; (iii) there occurs a sale, exchange, transfer or other disposition of substantially all of the assets of CPA: 17 to another entity, which disposition is not approved by the Board; or (iv) there occurs a contested proxy solicitation of the Shareholders of CPA: 17 that results in the contesting party electing candidates to a majority of the Board’s positions next up for election.

     “Closing Date.” The first date on which Shares were issued pursuant to an Offering.

     “Code.” Internal Revenue Code of 1986, as amended.

     “Competitive Real Estate Commission.” The real estate or brokerage commission paid for the purchase or sale of a Property that is reasonable, customary and competitive in light of the size, type and location of the Property.

     “Construction Fee.” A fee or other remuneration for acting as general contractor and/or construction manager to construct improvements, supervise and coordinate projects or to provide major repairs or rehabilitation on a Property.

     “Contract Purchase Price.” The amount actually paid for, or allocated to, the purchase, development, construction or improvement of an Investment or, in the case of an originated Loan, the principal amount of such Loan, exclusive, in each case, of Acquisition Fees and Acquisition Expenses.

     “Contract Sales Price.” The total consideration received by CPA: 17 for the sale of a Property.

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     “CPA: 17.” Corporate Property Associates 17 – Global Incorporated together with its consolidated subsidiaries, including the Operating Partnership, unless in the context of a particular reference, it is clear that such reference refers to Corporate Property Associates 17 – Global Incorporated excluding its consolidated subsidiaries. Unless the context otherwise requires, any reference to financial measures of CPA: 17 shall be calculated by reference to the consolidated financial statements of CPA: 17 and its subsidiaries, including, without limitation, the Operating Partnership, prepared in accordance with GAAP.

     “Cumulative Return.” For the period for which the calculation is being made, the percentage resulting from dividing (A) the total Distributions for such period (not including Distributions out of Cash from Sales and Financings), by (B) the product of (i) either (x) until such time as CPA: 17 has invested 90% of the net proceeds of CPA: 17’s initial Offering (excluding net proceeds from the sale of Shares pursuant to CPA: 17’s distribution reinvestment program), the average Adjusted Investor Capital for such period (calculated on a daily basis) or (y) from and after such time as CPA: 17 has invested 90% of the net proceeds of CPA: 17’s initial Offering (excluding net proceeds from the sale of Shares pursuant to CPA: 17’s distribution reinvestment program), the net proceeds from the sale of Shares (excluding net proceeds from the sale of Shares pursuant to CPA: 17’s distribution reinvestment program), as adjusted for Redemptions other than Redemptions intended to qualify as a liquidity event for purposes of this Agreement, and by any other Distributions on or prior to such date determined by the Board to be from Cash from Sales and Financings, and (ii) the number of years (including fractions thereof) elapsed during such period. Notwithstanding the foregoing, neither the Shares received by the Advisor or its Affiliates for any consideration other than cash, nor the Distributions in respect of such Shares, shall be included in the foregoing calculation.

     “Development Fee.” A fee for the packaging of a Property including negotiating and approving plans, and undertaking to assist in obtaining zoning and necessary variances and necessary financing for the specific Property, either initially or at a later date.

     “Directors.” The persons holding such office, as of any particular time, under the Articles of Incorporation, whether they be the directors named therein or additional or successor directors.

     “Distributions.” Distributions declared by the Board.

     “GAAP.” Generally accepted accounting principles in the United States.

     “Good Reason.” With respect to the termination of this Agreement, (i) any failure to obtain a satisfactory agreement from any successor to CPA: 17 or the Operating Partnership to assume and agree to perform CPA: 17’s or the Operating Partnership’s, as applicable, obligations under this Agreement; or (ii) any material breach of this Agreement of any nature whatsoever by CPA: 17 or the Operating Partnership; provided that (a) such breach is of a material term or condition of this Agreement and (b) CPA: 17 or the Operating Partnership, as applicable, has not cured such breach within 30 days of written notice thereof or, in the case of any breach that cannot be cured within 30 days by reasonable effort, has not taken all necessary action within a reasonable time period to cure such breach.

     “Gross Offering Proceeds.” The aggregate purchase price of Shares sold in any Offering.

     “Independent Appraiser.” A qualified appraiser of real estate as determined by the Board, who is not affiliated, directly or indirectly, with CPA: 17, the Advisor or their respective Affiliates. Membership in a nationally recognized appraisal society such as the American Institute of Real Estate Appraisers or the Society of Real Estate Appraisers shall be conclusive evidence of such qualification.

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     “Independent Director.” A Director of CPA: 17 who meets the criteria for an Independent Director specified in the Bylaws.

     “Individual.” Any natural person and those organizations treated as natural persons in Section 542(a) of the Code.

     “Initial Acquisition Fee.” Any fee or commission (including any interest thereon) paid by the Operating Partnership to the Advisor or, with respect to Section 9(d) or 9(f), by the Operating Partnership to any party, in connection with the making of an Investment or the development or construction of Properties by CPA: 17. A Development Fee or a Construction Fee paid to a Person not affiliated with the Sponsor in connection with the actual development or construction of a project after acquisition of the Property by CPA: 17 shall not be deemed an Initial Acquisition Fee. Initial Acquisition Fees include, but are not limited to, any real estate commission, selection fee, development fee or construction fee (other than as described above), non-recurring management fees, loan fees, points or any fee of a similar nature, however designated. Initial Acquisition Fees include Subordinated Acquisition Fees unless the context otherwise requires. Initial Acquisition Fees shall not include Acquisition Expenses.

     “Initial Investor Capital.” The total amount of capital invested from time to time by Shareholders (computed at the Original Issue Price per Share), excluding any Shares received by the Advisor or its Affiliates for any consideration other than cash.

     “Investment.” means an investment made by CPA: 17, directly or indirectly, in a Property, Loan or Other Permitted Investment Asset.

     “Loans.” The notes and other evidences of indebtedness or obligations acquired, originated or entered into, directly or indirectly, by CPA: 17 as lender, noteholder, participant, note purchaser or other capacity, including but not limited to first or subordinate mortgage loans, construction loans, development loans, loan participations, B notes, loans secured by capital stock or any other assets or form of equity interest and any other type of loan or financial arrangement, such as providing or arranging for letters of credit, providing guarantees of obligations to third parties, or providing commitments for loans. The term “Loans” shall not include leases which are not recognized as leases for Federal income tax reporting purposes.

     “Loan Refinancing Fee.” A fee payable to the Advisor in respect of the refinancing of a loan secured by an Investment.

     “Long-Term Net Leased Property.” A Property subject to a Net Lease which has a remaining lease term of at least seven years (or is otherwise subject to terms the effect of which is that there is a reasonable likelihood that the lease will have a remaining term of at least seven years as a result of the exercise of options or otherwise) at the date such Property is acquired or developed by CPA: 17, including Net Leased Properties accounted for under the equity method of accounting.

     “Market Value.” The value calculated by multiplying the total number of outstanding Shares by the average closing price of the Shares over the 30 trading days beginning 180 calendar days after the Shares are first listed on a national security exchange or included for quotation on Nasdaq, as the case may be.

     “Nasdaq.” The national automated quotation system operated by the National Association of Securities Dealers, Inc.

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     “Net Lease.” A lease pursuant to which the tenant is required to pay substantially all of the costs associated with operating and maintaining the Property.

     “Offering.” The offering of Shares pursuant to a Prospectus.

     “Operating Expenses.” All consolidated operating, general and administrative expenses paid or incurred by CPA: 17, as determined under GAAP, except the following (insofar as they would otherwise be considered operating, general and administrative expenses under GAAP): (i) interest and discounts and other cost of borrowed money; (ii) taxes (including state, Federal and foreign income tax, property taxes and assessments, franchise taxes and taxes of any other nature); (iii) expenses of raising capital, including Organization and Offering Expenses, printing, engraving, and other expenses, and taxes incurred in connection with the issuance and distribution of CPA: 17’s Shares and Securities; (iv) Acquisition Expenses, real estate commissions on resale of property and other expenses connected with the acquisition, disposition, origination, ownership and operation of Investments, including the costs of foreclosure, insurance premiums, legal services, brokerage and sales commissions, and the maintenance, repair and improvement of property; (v) Acquisition Fees or Subordinated Disposition Fees payable to the Advisor or any other party; (vi) distributions paid by the Operating Partnership to the Special General Partner under the agreement of limited partnership of the Operating Partnership in respect of gains realized on dispositions of Investments; (vii) amounts paid to effect a redemption or repurchase of the special general partner interest held by the Special General Partner pursuant to the agreement of limited partnership of the Operating Partnership; and (viii) non-cash items, such as depreciation, amortization, depletion, and additions to reserves for depreciation, amortization, depletion, losses and bad debts. Notwithstanding anything herein to the contrary, Operating Expenses shall include the Asset Management Fee and any Loan Refinancing Fee and, solely for the purposes of determining compliance with the 2%/25% Guidelines, distributions of profits and cash flow made by the Operating Partnership to the Special General Partner pursuant to the agreement of limited partnership of the Operating Partnership, other than distributions described in clauses (vi) and (vii) of this definition.

     “Operating Partnership.” CPA: 17 Limited Partnership, a Delaware limited partnership.

     “Organization and Offering Expenses.” Those expenses payable by CPA: 17 and the Operating Partnership in connection with the formation, qualification and registration of CPA: 17 and in marketing and distributing Shares, including, but not limited to: (i) the preparation, printing, filing and delivery of any registration statement or Prospectus and the preparing and printing of contractual agreements among CPA: 17, the Operating Partnership and the Sales Agent and the Selected Dealers (including copies thereof); (ii) the preparing and printing of the Articles of Incorporation and Bylaws, solicitation material and related documents and the filing and/or recording of such documents necessary to comply with the laws of the State of Maryland for the formation of a corporation and thereafter for the continued good standing of a corporation; (iii) the qualification or registration of the Shares under state securities or “Blue Sky” laws; (iv) any escrow arrangements, including any compensation to an escrow agent; (v) the filing fees payable to the SEC and to the National Association of Securities Dealers, Inc.; (vi) reimbursement for the reasonable and identifiable out-of-pocket expenses of the Sales Agent and the Selected Dealers, including the cost of their counsel; (vii) the fees of CPA: 17’s counsel; (viii) all advertising expenses incurred in connection with an Offering, including the cost of all sales literature and the costs related to investor and broker-dealer sales and information meetings and marketing incentive programs; and (ix) selling commissions, selected dealer fees, marketing fees, incentive fees, due diligence fees and wholesaling fees incurred in connection with the sale of the Shares.

     “Original Issue Price.” For any Share issued in an Offering, the price at which such Share was initially offered to the public by CPA: 17, regardless of whether selling commissions were paid in connection with the purchase of such Share from CPA: 17.

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     “Other Permitted Investment Asset.” An asset, other than cash, cash equivalents, short term bonds, auction rate securities and similar short term investments, acquired by CPA: 17 for investment purposes that is not a Loan or a Property and is consistent with the investment objectives and policies of CPA: 17.

     “Person.” An Individual, corporation, partnership, joint venture, association, company, trust, bank, or other entity, or government or any agency or political subdivision of a government.

     “Preferred Return.” A Cumulative Return of five percent computed from the Closing Date through the date as of which such amount is being calculated.

     “Property or Properties.” CPA: 17’s partial or entire interest in real property (including leasehold interests) and personal or mixed property connected therewith. An Investment which obligates CPA: 17 to acquire a Property will be treated as a Property for purposes of this Agreement.

     “Property Management Fee.” A fee for property management services rendered by the Advisor or its Affiliates in connection with Properties acquired directly or through foreclosure.

     “Prospectus.” Any prospectus pursuant to which CPA: 17 offers Shares in a public offering, as the same may at any time and from time to time be amended or supplemented after the effective date of the registration statement in which it is included.

     “Redemptions.” An amount determined by multiplying the number of Shares redeemed by the Original Issue Price.

     “REIT.” A real estate investment trust, as defined in Sections 856-860 of the Code.

     “Sales Agent.” Carey Financial Corporation.

     “Securities.” Any stock, shares (other than currently outstanding Shares and subsequently issued Shares), voting trust certificates, bonds, debentures, notes or other evidences of indebtedness, secured or unsecured, convertible, subordinated or otherwise or in general any instruments commonly known as “securities” or any certificate of interest, shares or participation in temporary or interim certificates for receipts (or, guarantees of, or warrants, options or rights to subscribe to, purchase or acquire any of the foregoing), which subsequently may be issued by CPA: 17.

     “Selected Dealers.” Broker-dealers who are members of the National Association of Securities Dealers, Inc. and who have executed an agreement with the Sales Agent in which the Selected Dealers agree to participate with the Sales Agent in the Offering.

     “Shareholders.” Those Persons who, at the time any calculation hereunder is to be made, are shown as holders of record of Shares on the books and records of CPA: 17.

     “Share Market Value.” The value calculated by multiplying the total number of outstanding Shares by the average closing price of the Shares over the 30 trading days beginning 180 calendar days after the Shares are first listed on a national security exchange or included for quotation on Nasdaq, as the case may be.

     “Shares.” All of the shares of common stock of CPA: 17, $.001 par value, and any other shares of common stock of CPA: 17.

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     “Special General Partner.” W. P. Carey Holdings, LLC and any permitted transferee of the special general partnership interest under the agreement of limited partnership of the Operating Partnership.

     “Sponsor.” W. P. Carey & Co. LLC and any other Person directly or indirectly instrumental in organizing, wholly or in part, CPA: 17 or any person who will control, manage or participate in the management of CPA: 17, and any Affiliate of any such person. Sponsor does not include a person whose only relationship to CPA: 17 is that of an independent property manager and whose only compensation is as such. Sponsor also does not include wholly independent third parties such as attorneys, accountants and underwriters whose only compensation is for professional services.

     “Subordinated Acquisition Fee.” The Subordinated Acquisition Fee as defined in Section 9(c) hereof.

     “Subordinated Disposition Fee.” The Subordinated Disposition Fee as defined in Section 9(f) hereof.

     “Termination Date.” The effective date of any termination of this Agreement.

     “Total Investment Cost.” With regard to any Investment, an amount equal to the sum of the Contract Purchase Price of such Investment plus the Acquisition Fees and Acquisition Expenses paid in connection with such Investment.

     2. Appointment. CPA: 17 hereby appoints the Advisor to serve as its advisor on the terms and conditions set forth in this Agreement, and the Advisor hereby accepts such appointment.

     3. Duties of the Advisor. The Advisor undertakes to use its best efforts to present to CPA: 17 potential investment opportunities and to provide a continuing and suitable investment program consistent with the investment objectives and policies of CPA: 17 as determined and adopted from time to time by the Board. In performance of this undertaking, subject to the supervision of the Board and consistent with the provisions of the Articles of Incorporation and Bylaws of CPA: 17 and any Prospectus pursuant to which Shares are offered, the Advisor shall, either directly or by engaging an Affiliate:

     (a) serve as CPA: 17’s investment and financial advisor and provide research and economic and statistical data in connection with CPA: 17’s assets and investment policies;

     (b) provide the daily management of CPA: 17 and perform and supervise the various administrative functions reasonably necessary for the management of CPA: 17;

     (c) investigate, select, and, on behalf of CPA: 17, engage and conduct business with such Persons as the Advisor deems necessary to the proper performance of its obligations hereunder, including but not limited to consultants, accountants, correspondents, lenders, technical advisors, attorneys, brokers, underwriters, corporate fiduciaries, escrow agents, depositaries, custodians, agents for collection, insurers, insurance agents, banks, builders, developers, property owners, mortgagors, and any and all agents for any of the foregoing, including Affiliates of the Advisor, and Persons acting in any other capacity deemed by the Advisor necessary or desirable for the performance of any of the foregoing services, including but not limited to entering into contracts in the name of CPA: 17 with any of the foregoing;

     (d) consult with Directors of CPA: 17 and assist the Board in the formulation and implementation of CPA: 17’s policies, and furnish the Board with such information, advice and

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recommendations as they may request or as otherwise may be necessary to enable them to discharge their fiduciary duties with respect to matters coming before the Board;

     (e) subject to the provisions of Sections 3(g) and 4 hereof: (i) locate, analyze and select potential Investments; (ii) structure and negotiate the terms and conditions of transactions pursuant to which Investments will be made, purchased or acquired by CPA: 17; (iii) make Investments on behalf of CPA: 17; (iv) arrange for financing and refinancing of, make other changes in the asset or capital structure of, dispose of, reinvest the proceeds from the sale of, or otherwise deal with the Investments; and (v) enter into leases and service contracts for Properties and, to the extent necessary, perform all other operational functions for the maintenance and administration of such Properties;

     (f) provide the Board with periodic reports regarding prospective Investments and with periodic reports, no less than quarterly, of new Investments made during the prior fiscal quarter, which reports shall include information regarding the type of each Investment made (in the categories provided in Section 9);

     (g) obtain the prior approval of the Board (including a majority of the Independent Directors) for any and all investments in Property which do not meet all of the requirements set forth in Section 4(b) hereof;

     (h) negotiate on behalf of CPA: 17 with banks or lenders for loans to be made to CPA: 17, and negotiate on behalf of CPA: 17 with investment banking firms and broker-dealers or negotiate private sales of Shares and Securities or obtain loans for CPA: 17, but in no event in such a way so that the Advisor shall be acting as broker-dealer or underwriter; and provided, further, that any fees and costs payable to third parties incurred by the Advisor in connection with the foregoing shall be the responsibility of CPA: 17;

     (i) obtain reports (which may be prepared by the Advisor or its Affiliates), where appropriate, concerning the value of Investments or contemplated Investments;

     (j) obtain for, or provide to, CPA: 17 such services as may be required in acquiring, managing and disposing of Investments, including, but not limited to: (i) the negotiation, making and servicing of Investments; (ii) the disbursement and collection of Company monies; (iii) the payment of debts of and fulfillment of the obligations of CPA: 17; and (iv) the handling, prosecuting and settling of any claims of or against CPA: 17, including, but not limited to, foreclosing and otherwise enforcing mortgages and other liens securing Loans;

     (k) from time to time, or at any time reasonably requested by the Board, make reports to the Board of its performance of services to CPA: 17 under this Agreement;

     (l) communicate on behalf of CPA: 17 with Shareholders as required to satisfy the reporting and other requirements of any governmental bodies or agencies to Shareholders and third parties and otherwise as requested by CPA: 17;

     (m) provide or arrange for administrative services and items, legal and other services, office space, office furnishings, personnel and other overhead items necessary and incidental to CPA: 17’s business and operations;

     (n) provide CPA: 17 with such accounting data and any other information requested by CPA: 17 concerning the investment activities of CPA: 17 as shall be required to prepare and to

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file all periodic financial reports and returns required to be filed with the Securities and Exchange Commission and any other regulatory agency, including annual financial statements;

     (o) maintain the books and records of CPA: 17;

     (p) supervise the performance of such ministerial and administrative functions as may be necessary in connection with the daily operations of the Investments;

     (q) provide CPA: 17 with all necessary cash management services;

     (r) do all things necessary to assure its ability to render the services described in this Agreement;

     (s) perform such other services as may be required from time to time for management and other activities relating to the assets of CPA: 17 as the Advisor shall deem advisable under the particular circumstances;

     (t) arrange to obtain on behalf of CPA: 17 as requested by the Board, and deliver to or maintain on behalf of CPA: 17 copies of, all appraisals obtained in connection with investments in Properties and Loans; and

     (u) if a transaction, proposed transaction or other matter requires approval by the Board or by the Independent Directors, deliver to the Board or the Independent Directors, as the case may be, all documentation reasonably requested by them to properly evaluate such transaction, proposed transaction or other matter.

     4. Authority of Advisor.

     (a) Pursuant to the terms of this Agreement (and subject to the restrictions included in Paragraphs (b), (c) and (d) of this Section 4 and in Section 7 hereof), and subject to the continuing and exclusive authority of the Board over the management of CPA: 17, the Board hereby delegates to the Advisor the authority to: (1) locate, analyze and select Investment opportunities; (2) structure the terms and conditions of transactions pursuant to which Investments will be made or acquired for CPA: 17; (3) make or acquire Investments in compliance with the investment objectives and policies of CPA: 17; (4) arrange for financing or refinancing, or make changes in the asset or capital structure of, and dispose of or otherwise deal with, Investments; (5) enter into leases and service contracts for Properties, and perform other property level operations; (6) oversee non-affiliated property managers and other non-affiliated Persons who perform services for CPA: 17; and (7) undertake accounting and other record-keeping functions at the Investment level.

     (b) The consideration paid for an Investment acquired by CPA: 17 shall ordinarily be based on the fair market value thereof. Consistent with the foregoing provision, the Advisor may, without further approval by the Board (except with respect to transactions subject to paragraphs (c) and (d)) invest on behalf of CPA: 17 in an Investment so long as, in the Advisor’s good faith judgment, (i) the Total Investment Cost of such Investment does not exceed the fair market value thereof, and in the case of an Investment that is a Property, shall in no event exceed the Appraised Value of such Property and (ii) the Investment, in conjunction with CPA: 17’s other investments and proposed investments, at the time CPA: 17 is committed to purchase or originate the Investment, is reasonably expected to fulfill CPA: 17’s investment objectives and policies as established by the Board and then in effect. For purposes of the foregoing, Total Investment Cost

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shall be measured at the date the Investment is made and shall exclude future commitments to fund improvements. Investments not meeting the foregoing criteria must be approved in advance by the Board.

     (c) Notwithstanding anything to the contrary contained in this Agreement, the Advisor shall not cause CPA: 17 to make Investments that do not comply with Article VIII (Restrictions on Investments and Activities) and related sections of the Bylaws.

     (d) The prior approval of the Board, including a majority of the Independent Directors and a majority of the Directors not interested in the transaction, will be required for: (i) Investments made through co-investment or joint venture arrangements with the Sponsor, the Advisor or any of their Affiliates; (ii) Investments which are not contemplated by the terms of a Prospectus; (iii) transactions that present issues which involve conflicts of interest for the Advisor or an Affiliate (other than conflicts involving the payment of fees or the reimbursement of expenses); (iv) the lease of assets to the Sponsor, any Director, the Advisor or any Affiliate of the Advisor; (v) any purchase or sale of an Investment from or to the Advisor or an Affiliate; and (vi) the retention of any Affiliate of the Advisor to provide services to CPA: 17 not expressly contemplated by this Agreement and the terms of such services by such Affiliate. In addition, the Advisor shall comply with any further approval requirements set forth in the Bylaws.

     (e) The Board may, at any time upon the giving of notice to the Advisor, modify or revoke the authority set forth in this Section 4. If and to the extent the Board so modifies or revokes the authority contained herein, the Advisor shall henceforth comply with such modification or revocation, provided however, that such modification or revocation shall be effective upon receipt by the Advisor and shall not be applicable to investment transactions to which the Advisor has committed CPA: 17 prior to the date of receipt by the Advisor of such notification.

     5. Bank Accounts. The Advisor may establish and maintain one or more bank accounts in its own name for the account of CPA: 17 or in the name of CPA: 17 and may collect and deposit into any such account or accounts, and disburse from any such account or accounts, any money on behalf of CPA: 17, provided that no funds shall be commingled with the funds of the Advisor; and the Advisor shall from time to time render appropriate accountings of such collections and payments to the Board and to the auditors of CPA: 17.

     6. Records; Access. The Advisor shall maintain appropriate records of all its activities hereunder and make such records available for inspection by the Board and by counsel, auditors and authorized agents of CPA: 17, at any time or from time to time during normal business hours. The Advisor shall at all reasonable times have access to the books and records of CPA: 17.

     7. Limitations on Activities. Anything else in this Agreement to the contrary notwithstanding, the Advisor shall refrain from taking any action which, in its sole judgment made in good faith, would adversely affect the status of CPA: 17 as a REIT or of the Operating Partnership as a partnership for Federal income tax purposes, subject CPA: 17 or the Operating Partnership to regulation under the Investment Company Act of 1940, would violate any law, rule, regulation or statement of policy of any governmental body or agency having jurisdiction over CPA: 17, its Shares or its Securities, or otherwise not be permitted by the Articles of Incorporation or Bylaws or agreement of limited partnership of the Operating Partnership, except if such action shall be ordered by the Board, in which case the Advisor shall notify promptly the Board of the Advisor’s judgment of the potential impact of such action and shall refrain from taking such action until it receives further clarification or instructions

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from the Board. In such event the Advisor shall have no liability for acting in accordance with the specific instructions of the Board so given.

     (a) Notwithstanding the foregoing, the Advisor, its shareholders, directors, officers and employees, and partners, shareholders, directors and officers of the Advisor’s shareholders and Affiliates of any of them, shall not be liable to CPA: 17, the Operating Partnership or to the Directors or Shareholders for any act or omission by the Advisor, its shareholders, directors, officers and employees, or partners, shareholders, directors or officers of the Advisor’s shareholders and Affiliates of any of them if the following conditions are met:

     (i) The Advisor, its shareholders, directors, officers and employees, and partners, shareholders, directors and officers of the Advisor’s shareholders and Affiliates of any of them have determined, in good faith, that the course of conduct which caused the loss or liability was in the best interests of CPA: 17;

     (ii) The Advisor, its shareholders, directors, officers and employees, and partners, shareholders, directors and officers of the Advisor’s shareholders and Affiliates of any of them were acting on behalf of or performing services for CPA: 17; and

     (iii) Such liability or loss was not the result of negligence or misconduct by the Advisor, its shareholders, directors, officers and employees, and partners, shareholders, directors and officers of the Advisor’s shareholders or Affiliates of any of them.

     (b) Notwithstanding the foregoing, the Advisor and its Affiliates shall not be indemnified by CPA: 17 or the Operating Partnership for any losses, liabilities or expenses arising from or out of the alleged violation of federal or state securities laws unless one or more of the following conditions are met:

     (i) There has been a successful adjudication on the merits of each count involving alleged securities law violations as to the particular indemnitee;

     (ii) Such claims have been dismissed with prejudice on the merits by a court of competent jurisdiction as to the particular indemnitee; or

     (iii) A court of competent jurisdiction approves a settlement of the claims against a particular indemnitee and finds that indemnification of the settlement and the related costs should be made, and the court considering the request for indemnification has been advised of the position of the Securities and Exchange Commission and of the published position of any state securities regulatory authority in which securities of CPA: 17 were offered or sold as to indemnification for violation of securities laws.

     (c) CPA: 17 and the Operating Partnership shall advance funds to the Advisor or its Affiliates for legal expenses and other costs incurred as a result of any legal action for which indemnification is being sought only if all of the following conditions are satisfied:

     (i) The legal action relates to acts or omissions with respect to the performance of duties or services on behalf of CPA: 17;

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     (ii) The legal action is initiated by a third party who is not a Shareholder or the legal action is initiated by a Shareholder acting in his or her capacity as such and a court of competent jurisdiction specifically approves such advancement; and

     (iii) The Advisor or the Affiliate undertakes to repay the advanced funds to CPA: 17, together with the applicable legal rate of interest thereon, in cases in which such Advisor or Affiliate is found not to be entitled to indemnification.

     (d) Notwithstanding the foregoing, the Advisor shall not be entitled to indemnification or be held harmless pursuant to this Section 7 for any activity which the Advisor shall be required to indemnify or hold harmless CPA: 17 pursuant to Section 22.

     (e) Any amounts paid pursuant to this Section 7 shall be recoverable or paid only out the net assets of CPA: 17 and not from Shareholders.

     8. Relationship with Directors. There shall be no limitation on any shareholder, director, officer, employee or Affiliate of the Advisor serving as a Director or an officer of CPA: 17, except that no employee of the Advisor or its Affiliates who also is a Director or officer of CPA: 17 shall receive any compensation from CPA: 17 for serving as a Director or officer other than for reasonable reimbursement for travel and related expenses incurred in attending meetings of the Board; for the avoidance of doubt, the limitations of this Section 8 shall not apply to any compensation paid by the Advisor or any Affiliate for which CPA: 17 reimbursed the Advisor or Affiliate in accordance with Section 10 hereof.

     9. Fees.

     (a) Asset Management Fee. (i) The Operating Partnership shall pay to the Advisor as compensation for the advisory services rendered hereunder an asset management fee (the “Asset Management Fee”) in an amount equal to the percentage of the Average Equity Market Value of an Investment as specified in the following table:

Type of Investment	Asset Management Fee
Long-Term Net Leased Properties	0.50% of the Average Market Value
B Notes, mortgage backed securities and Loans	1.75% of the Average Equity Value
Investments in readily marketable real estate securities (other than B Notes, mortgage backed securities and Loans) purchased on the secondary market	1.50% of the Average Equity Value
All other Investments not described in the foregoing categories, such as interests in entities that own real estate or are engaged in real estate related businesses, short-term net leases and equity investments in real property	0.50% of the Average Market Value

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     (ii) The Asset Management Fee with respect to an Investment will be calculated monthly, beginning with the month in which CPA: 17 first makes the Investment, and shall be pro rated for the number of days during a month that CPA: 17 owns the Investment. The aggregate Asset Management Fees calculated with respect to each month shall be payable on the first business day following such month.

     (b) Initial Acquisition Fee. (i) The Advisor may receive as partial compensation for services rendered in connection with the investigation, selection, acquisition or origination (by purchase, investment or exchange) of any Investment, an initial acquisition fee (an “Initial Acquisition Fee”) payable by the Operating Partnership. The Initial Acquisition Fee payable to the Advisor in respect of an Investment shall be payable at the time such Investment is acquired in an amount determined as specified in the following table:

Type of Investment	Initial Acquisition Fee
Long term Net Leased Properties	2.5% of the aggregate Total Investment Cost
B Notes, mortgage backed securities and Loans	1.0% of the sum of (x) the Average Equity Value, plus (y) the Acquisition Fees paid by CPA: 17 in respect of the Investment.
Investments in readily marketable real estate securities (other than B notes, mortgage backed securities and Loans) purchased on the secondary market	None
All other Investments not described in the foregoing categories, such as interests in entities that own real estate or are engaged in real estate related businesses, short term net leases and equity investments in real property	1.75% of the sum of (x) the equity capital invested by CPA: 17 in the Investment plus (y) the Acquisition Fees paid by CPA: 17 in respect of the Investment.

     (ii) At the time an Investment is made, the Advisor shall determine the type of Investment, which shall be used for the purpose of calculating all fees due hereunder; it being understood that the Advisor shall use its reasonable judgment, based primarily upon the economic substance of an Investment, in determining the classification of an Investment, provided, that in the event of any dispute, the Independent Directors shall finally determine for all purposes the type of Investment.

     (c) Subordinated Acquisition Fee. (i) In addition to the Initial Acquisition Fee described in Section 9(b) above, the Advisor may receive additional compensation in connection with the investigation, selection, acquisition or origination (by purchase, investment or exchange) of Investments a Subordinated Acquisition Fee payable by the Operating Partnership to the Advisor or its Affiliates (the “Subordinated Acquisition Fee”). The total Subordinated Acquisition Fees payable shall be an amount determined as specified in the following table:

Type of Investment	Subordinated Acquisition Fee
Long term Net Leased Properties	2.0% of the aggregate Total Investment Cost.
All other Investments not described in the foregoing category	None

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     (ii) The Subordinated Acquisition Fee shall be payable in three equal annual installments on the first business day of the fiscal quarter immediately following the fiscal quarter in which the Investment is made and the first business day of the corresponding fiscal quarter in each of the subsequent two fiscal years. The unpaid portion of the Subordinated Acquisition Fee with respect to any Investment will bear interest at the rate of 5% per annum from the date of acquisition of the Investment until the portion of the Subordinated Acquisition Fee is paid. The accrued interest is payable on the date of each annual installment of the fees. The Subordinated Acquisition Fee payable in any year, and accrued interest thereon, will be subordinated to the Preferred Return of 5% and only paid if the Preferred Return of 5% has been achieved through the end of the prior fiscal quarter. Any portion of the Subordinated Acquisition Fee, and accrued interest thereon, not paid due to CPA: 17’s failure to meet the Preferred Return of 5% through any fiscal quarter end shall be paid by CPA: 17 on the first business day of the fiscal quarter next following the fiscal quarter end through which the Preferred Return of 5% has been met.

     (d) Six Percent Limitation. The total amount of all Initial Acquisition Fees plus Subordinated Acquisition Fees, including interest thereon, whether payable to the Advisor or a third party, and Acquisition Expenses payable by the Operating Partnership may not exceed 6% of the aggregate Contract Purchase Price of all Investments, measured for the period beginning with the initial acquisition of an Investment and ending (i) on December 31 of the year in which CPA: 17 has invested 90% of the net proceeds of its initial Offering (excluding the net proceeds from the sale of Shares pursuant to CPA: 17’s dividend reinvestment program), and (ii) on each December 31 thereafter, unless a majority of the Directors (including a majority of the Independent Directors) not otherwise interested in any transaction approves the excess as being commercially competitive, fair and reasonable to CPA: 17.

     (e) Property Management Fee; Loan Refinancing Fee. No Property Management Fee or Loan Refinancing Fee shall be paid unless approved by a majority of the Independent Directors.

     (f) Subordinated Disposition Fee. (i) If the Advisor or an Affiliate provides a substantial amount of services in the sale of an Investment, the Advisor or such Affiliate shall be entitled to receive a subordinated disposition fee (the “Subordinated Disposition Fee”) at the time of such disposition, in an amount equal to the lesser of (1) 50% of the Competitive Real Estate Commission (if applicable) and (2) 3.0% of the Contract Sales Price of the Investment; provided, however, that (A) the Subordinated Disposition Fee in respect of Investments that are B Notes, mortgage backed securities and Loans shall equal 1.0% of the equity capital invested by CPA: 17 in the Investment, and (B) no Subordinated Disposition Fee shall be paid in respect of Investments that are readily marketable securities.

     (ii) The total real estate commissions and Subordinated Disposition Fees CPA: 17 pays to all Persons shall not exceed an amount equal to the lesser of: (1) 6% of the Contract Sales Price of the Investment or (2) the Competitive Real Estate Commission. Payment of Subordinated Disposition Fees and accrued interest thereon, will be subordinated to the Preferred Return and only paid if the Preferred Return of 5% has been achieved through the end of the prior fiscal quarter. To the extent that Subordinated Disposition Fees are not paid on a current basis due to the foregoing

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limitation, the unpaid fees will be due and paid at such time as the limitation has been satisfied, together with interest from the time of disposition of the Investment to which they relate, at the rate of 5%. The Advisor shall present to the Independent Directors such information as they may reasonably request to review the level of services provided by the Advisor in connection with a disposition and the basis for the calculation of the amount of the Subordinated Disposition Fees on a quarterly basis. No payment of Subordinated Disposition Fees shall be made prior to review and approval of such information by the Independent Directors.

     (g) Loans From Affiliates. CPA: 17 shall not borrow funds from the Advisor or its Affiliates unless (A) the transaction is approved by a majority of the Independent Directors and a majority of the Directors who are not interested in the transaction as being fair, competitive and commercially reasonable, (B) the interest and other financing charges or fees received by the Advisor or its Affiliates do not exceed the amount which would be charged by non-affiliated lending institutions and (C) the terms are not less favorable than those prevailing for comparable arm’s-length loans for the same purpose. CPA: 17 will not borrow on a long-term basis from the Advisor or its Affiliates unless it is to provide the debt portion of a particular investment and CPA: 17 is unable to obtain a permanent loan at that time or in the judgment of the Board, it is not in CPA: 17’s best interest to obtain a permanent loan at the interest rates then prevailing and the Board has reason to believe that CPA: 17 will be able to obtain a permanent loan on or prior to the end of the loan term provided by the Advisor or its Affiliates.

     (h) Changes To Fee Structure. In the event the Shares are listed on a national securities exchange or are included for quotation on Nasdaq, CPA: 17 and the Advisor shall negotiate in good faith to establish a fee structure appropriate for an entity with a perpetual life. A majority of the Independent Directors must approve the new fee structure negotiated with the Advisor. In negotiating a new fee structure, the Independent Directors may consider any of the factors they deem relevant, including but not limited to: (a) the size of the Advisory Fee in relation to the size, composition and profitability of CPA: 17’s portfolio; (b) the success of the Advisor in generating opportunities that meet the investment objectives of CPA: 17; (c) the rates charged to other REITs and to investors other than REITs by Advisors performing similar services; (d) additional revenues realized by the Advisor and its Affiliates through their relationship with CPA: 17, including loan administration, underwriting or broker commissions, servicing, engineering, inspection and other fees, whether paid by CPA: 17 or by others with whom CPA: 17 does business; (e) the quality and extent of service and advice furnished by the Advisor; (f) the performance of the investment portfolio of CPA: 17, including income, conservation or appreciation of capital, frequency of problem investments and competence in dealing with distress situations; and (g) the quality of the portfolio of CPA: 17 in relationship to the investments generated by the Advisor for the account of other clients. The Independent Directors shall not approve any new fee structure that is in their judgment more favorable (taken as a whole) to the Advisor than the current fee structure.

     (i) Payment. Compensation payable to the Advisor pursuant to this Section 9 shall be paid in cash; provided, however, that any fee payable pursuant to Section 9 may be paid, at the option of the Advisor, in the form of: (i) cash, (ii) restricted stock of CPA: 17, or (iii) a combination of cash and restricted stock. The Advisor shall notify CPA: 17 in writing annually of the form in which the fee shall be paid. Such notice shall be provided no later than January 15 of each year. If no such notice is provided, the fee shall be paid in cash. For purposes of the payment of compensation to the Advisor in the form of stock, the value of each share of restricted stock shall be: (i) the Net Asset Value per Share as determined based on the most recent appraisal of CPA: 17’s assets performed by an Independent Appraiser, or (ii) if an appraisal has

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not yet been performed, $10 per share. If shares are being offered to the public at the time a fee is paid with stock, the value shall be the price of the stock without commissions. The Net Asset Value determined on the basis of such appraisal may be adjusted on a quarterly or other basis by the Board to account for significant capital transactions. Stock issued by CPA: 17 to the Advisor in payment of fees hereunder shall be governed by the terms set forth in Schedule A hereto, or such other terms as the Advisor and CPA: 17 may from time to time agree.

     10. Expenses.

     (a) Subject to the limitations set forth in Section 9(d), to the extent applicable, in addition to the compensation paid to the Advisor pursuant to Section 9 hereof, the Operating Partnership shall pay directly or reimburse the Advisor for the following expenses:

     (i) Organization and Offering Expenses; provided however, that within 60 days after the end of the quarter in which any Offering terminates, the Advisor shall reimburse the Operating Partnership for any Organization and Offering Expense reimbursements received by the Advisor pursuant to this Section 10 to the extent that such reimbursements, when added to the balance of the Organization and Offering Expenses (excluding selling commissions, the selected dealer fee and the wholesaling fee) paid directly by the Operating Partnership, exceed four percent of the Gross Offering Proceeds; provided further, that the Advisor shall be responsible for the payment of all Organization and Offering Expenses (excluding such commissions and such fees and expense reimbursements) in excess of four percent of the Gross Offering Proceeds;

     (ii) all Acquisition Expenses;

     (iii) to the extent not included in Acquisition Expenses, all expenses of whatever nature reasonably incurred and directly connected with the proposed acquisition of any Investment that does not result in the actual acquisition of the Investment, including, without limitation, personnel costs;

     (iv) expenses other than Acquisition Expenses incurred in connection with the investment of the funds of CPA: 17, including, without limitation, costs of retaining industry or economic consultants and finder’s fees and similar payments, to the extent not paid by the seller of the Investment or another third party, regardless of whether such expenses were incurred in transactions where a fee is not payable to the Advisor;

     (v) interest and other costs for borrowed money, including discounts, points and other similar fees;

     (vi) taxes and assessments on income of CPA: 17, to the extent paid or advanced by the Advisor, or on Investments and taxes as an expense of doing business;

     (vii) costs associated with insurance required in connection with the business of CPA: 17 or by the Directors;

     (viii) expenses of managing and operating Investments owned by CPA: 17, whether payable to an Affiliate of the Advisor or a non-affiliated Person;

     (ix) fees and expenses of legal counsel for CPA: 17;

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     (x) fees and expense of auditors and accountants for CPA: 17;

     (xi) all expenses in connection with payments to the Directors and meetings of the Directors and Shareholders;

     (xii) expenses associated with listing the Shares and Securities on a securities exchange or Nasdaq if requested by the Board;

     (xiii) expenses connected with payments of Distributions in cash or otherwise made or caused to be made by the Board to the Shareholders;

     (xiv) expenses of organizing, revising, amending, converting, modifying, or terminating CPA: 17, the Operating Partnership or their respective governing instruments;

     (xv) expenses of maintaining communications with Shareholders, including the cost of preparation, printing and mailing annual reports and other Shareholder reports, proxy statements and other reports required by governmental entities; and

     (xvi) all other expenses the Advisor incurs in connection with providing services to CPA: 17, including reimbursement to the Advisor or its Affiliates for the cost of rent, goods, materials and personnel incurred by them based upon the compensation of the Persons involved and an appropriate share of overhead allocable to those Persons as reasonably determined by the Advisor on a basis approved annually by the Board (including a majority of the Independent Directors). No reimbursement shall be made for the cost of personnel to the extent that such personnel are used in transactions for which the Advisor receives a separate fee.

     (b) Expenses incurred by the Advisor on behalf of CPA: 17 and payable pursuant to this Section 10 shall be reimbursed quarterly to the Advisor within 60 days after the end of each quarter, subject to the provisions of Section 13 hereof. The Advisor shall prepare a statement documenting the Operating Expenses of CPA: 17 within 45 days after the end of each quarter.

     11. Other Services. Should the Board request that the Advisor or any Affiliate, shareholder or employee thereof render services for CPA: 17 other than as set forth in Section 3 hereof, such services shall be separately compensated and shall not be deemed to be services pursuant to the terms of this Agreement.

     12. Fidelity Bond. The Advisor shall maintain a fidelity bond for the benefit of CPA: 17 which bond shall insure CPA: 17 from losses of up to $5,000,000 and shall be of the type customarily purchased by entities performing services similar to those provided to CPA: 17 by the Advisor.

     13. Limitation on Expenses.

     (a) If Operating Expenses during the 12-month period ending on the last day of any fiscal quarter of CPA: 17 exceed the greater of (i) two percent of the Average Invested Assets during the same 12-month period or (ii) 25% of the Adjusted Net Income of CPA: 17 during the same 12-month period, then subject to paragraph (b) of this Section 13, such excess amount shall be the sole responsibility of the Advisor and neither the Operating Partnership nor CPA: 17 shall be liable for payment therefor. CPA: 17 may defer the payment or distribution to the Advisor and the Special General Partner of fees, expenses and distributions that would, if paid or distributed,

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cause Operating Expenses during such 12-month period to exceed the foregoing limitations; provided, however, that in determining which items shall be paid and which may be deferred, priority will be given to the payment of distributions to the Special General Partner over the payment to the Advisor of amounts due under this Agreement.

     (b) Notwithstanding the foregoing, to the extent that the Advisor becomes responsible for any excess amount as provided in paragraph (a), if a majority of the Independent Directors finds such excess amount or a portion thereof justified based on such unusual and non-recurring factors as they deem sufficient, the Operating Partnership shall reimburse the Advisor in future quarters for the full amount of such excess, or any portion thereof, but only to the extent such reimbursement would not cause the Operating Expenses to exceed the 2%/25% Guidelines in the 12-month period ending on the last day of such quarter. In no event shall the Operating Expenses payable by the Operating Partnership in any 12-month period ending at the end of a fiscal quarter exceed the 2%/25% Guidelines.

     (c) Within 60 days after the end of any twelve-month period referred to in paragraph (a), the Advisor shall reimburse CPA: 17 for any amounts expended by CPA: 17 in such twelve-month period that exceeds the limitations provided in paragraph (a) unless the Independent Directors determine that such excess expenses are justified, as provided in paragraph (b), and provided the Operating Expenses for such later quarter would not thereby exceed the 2%/25% Guidelines.

     (d) All computations made under paragraphs (a) and (b) of this Section 13 shall be determined in accordance with generally accepted accounting principles applied on a consistent basis.

     (e) If the Special General Partner receives distributions pursuant to the agreement of limited partnership of the Operating Partnership in respect of realized gains on the disposition of an Investment, Adjusted Net Income, for purposes of calculating the Operating Expenses, shall exclude the gain from the disposition of such Investment.

     14. Other Activities of the Advisor. Nothing herein contained shall prevent the Advisor from engaging in other activities, including without limitation direct investment by the Advisor and its Affiliates in assets that would be suitable for CPA: 17, the rendering of advice to other investors (including other REITs) and the management of other programs advised, sponsored or organized by the Advisor or its Affiliates; nor shall this Agreement limit or restrict the right of the Advisor or any of its Affiliates or of any director, officer, employee or shareholder of the Advisor or its Affiliates to engage in any other business or to render services of any kind to any other partnership, corporation, firm, individual, trust or association. The Advisor may, with respect to any investment in which CPA: 17 is a participant, also render advice and service to each other participant therein. Without limiting the generality of the foregoing, CPA 17 acknowledges that the Advisor provides or will provide services to other CPA REIT funds, whether now in existence or formed hereafter, and that the Advisor and its Affiliates may invest for their own account. The Advisor shall be responsible for promptly reporting to the Board the existence of any actual or potential conflict of interest that arises that may affect its performance of its duties under this Agreement. If the Sponsor, Advisor, Director or Affiliates thereof has or have sponsored other investment programs with similar investment objectives which have investment funds available at the same time as CPA: 17, it shall be the duty of the Advisor to adopt a reasonable method by which properties are to be allocated to the competing investment entities and to use its best efforts to apply such method fairly to CPA: 17.

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     The Advisor shall be required to use its best efforts to present a continuing and suitable investment program to CPA: 17 that is consistent with the investment policies and objectives of CPA: 17, but subject to the last sentence of the preceding paragraph, neither the Advisor nor any Affiliate of the Advisor shall be obligated generally to present any particular investment opportunity to CPA: 17 even if the opportunity is of character which, if presented to CPA: 17, could be taken by CPA: 17.

     If the Advisor or its Affiliates is presented with a potential investment which might be made by CPA: 17 and by another investment entity which the Advisor or its Affiliates advises or manages, the Advisor shall consider, among other things, the investment portfolio of each entity, cash flow of each entity, the effect of the acquisition on the diversification of each entity’s portfolio, rental payments during any renewal period, the estimated income tax effects of the purchase on each entity, the policies of each entity relating to leverage, the funds of each entity available for investment, the amount of equity required to make the investment and the length of time such funds have been available for investment.

     15. Relationship of Advisor and CPA: 17. CPA: 17 and the Advisor agree that they have not created and do not intend to create by this Agreement a joint venture or partnership relationship between them and nothing in this Agreement shall be construed to make them partners or joint venturers or impose any liability as partners or joint venturers on either of them.

     16. Term; Termination of Agreement. This Agreement, as amended and restated, shall continue in force until September 30, 2008 or until 60 days after the date on which the Independent Directors shall have notified the Advisor of their determination either to renew this Agreement for an additional one-year period or terminate this Agreement, as required by CPA:17’s Charter.

     17. Termination by CPA: 17. At the sole option the Board (including a majority of the Independent Directors), this Agreement may be terminated immediately by written notice of termination from CPA: 17 to the Advisor upon the occurrence of events which would constitute Cause or if any of the following events occur:

     (a) If the Advisor shall breach this Agreement; provided that such breach (i) is of a material term or condition of this Agreement and (ii) the Advisor has not cured such breach within 30 days of written notice thereof or, in the case of any breach that cannot be cured within 30 days by reasonable effort, has not taken all necessary action within a reasonable time period to cure such breach;

     (b) If the Advisor shall be adjudged bankrupt or insolvent by a court of competent jurisdiction, or an order shall be made by a court of competent jurisdiction for the appointment of a receiver, liquidator, or trustee of the Advisor, for all or substantially all of its property by reason of the foregoing, or if a court of competent jurisdiction approves any petition filed against the Advisor for reorganization, and such adjudication or order shall remain in force or unstayed for a period of 30 days; or

     (c) If the Advisor shall institute proceedings for voluntary bankruptcy or shall file a petition seeking reorganization under the federal bankruptcy laws, or for relief under any law for relief of debtors, or shall consent to the appointment of a receiver for itself or for all or substantially all of its property, or shall make a general assignment for the benefit of its creditors, or shall admit in writing its inability to pay its debts, generally, as they become due.

     Any notice of termination under Section 16 or 17 shall be effective on the date specified in such notice, which may be the day on which such notice is given or any date thereafter. The Advisor agrees

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that if any of the events specified in Section 17(b) or (c) shall occur, it shall give written notice thereof to the Board within 15 days after the occurrence of such event.

     18. Termination by Either Party. This Agreement may be terminated immediately without penalty (but subject to the requirements of Section 20 hereof) by the Advisor by written notice of termination to CPA: 17 upon the occurrence of events which would constitute Good Reason or by CPA: 17 without cause or penalty (but subject to the requirements of Section 20 hereof) by action of the Directors, a majority of the Independent Directors or by action of a majority of the Shareholders, in each case upon 60 days’ written notice.

     19. Assignment Prohibition. This Agreement may not be assigned by the Advisor without the approval of the Board (including a majority of the Independent Directors); provided, however, that such approval shall not be required in the case of an assignment to a corporation, partnership, association, trust or organization which may take over the assets and carry on the affairs of the Advisor, provided: (i) that at the time of such assignment, such successor organization shall be owned substantially by an entity directly or indirectly controlled by the Sponsor and only if such entity has a net worth of at least $5,000,000, and (ii) that the board of directors of the Advisor shall deliver to the Board a statement in writing indicating the ownership structure and net worth of the successor organization and a certification from the new Advisor as to its net worth. Such an assignment shall bind the assignees hereunder in the same manner as the Advisor is bound by this Agreement. The Advisor may assign any rights to receive fees or other payments under this Agreement without obtaining the approval of the Board. This Agreement shall not be assigned by CPA: 17 or the Operating Partnership without the consent of the Advisor, except in the case of an assignment by CPA: 17 or the Operating Partnership to a corporation or other organization which is a successor to CPA: 17 or the Operating Partnership, in which case such successor organization shall be bound hereunder and by the terms of said assignment in the same manner as CPA: 17 or the Operating Partnership is bound by this Agreement.

     20. Payments to and Duties of Advisor Upon Termination.

     (a) After the Termination Date, the Advisor shall not be entitled to compensation for further services hereunder but shall be entitled to receive from CPA: 17 the following:

     (i) all unpaid reimbursements of Organization and Offering Expenses and of Operating Expenses payable to the Advisor;

     (ii) all earned but unpaid Asset Management Fees payable to the Advisor prior to the Termination Date;

     (iii) all earned but unpaid Acquisition Fees and interest thereon, in each case payable to the Advisor relating to the acquisition of any Property prior to the Termination Date;

     (iv) all earned but unpaid Subordinated Disposition Fees and interest thereon, payable to the Advisor relating to the sale of any Investment prior to the Termination Date; and

     (v) all earned but unpaid Property Management Fees and Loan Refinancing Fees, if any, payable to the Advisor or its Affiliates relating to the management of any property prior to the termination of this Agreement.

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     (b) Notwithstanding the foregoing, if this Agreement is terminated by the Company for Cause, or by the Advisor for other than Good Reason, the Advisor will not be entitled to receive the sums in Section 20(a) (ii) through (v).

     (c) Any and all amounts payable to the Advisor pursuant to Section 20(a) that, irrespective of the termination, were payable on a current basis prior to the Termination Date either because they were not subordinated or all conditions to their payment had been satisfied, shall be paid within 90 days after the Termination Date. All other amounts shall be paid in a manner determined by the Board, but in no event on terms less favorable to the Advisor than those represented by a note (i) maturing upon the liquidation of CPA: 17 or the Operating Partnership or three years from the Termination Date, whichever is earlier, (ii) with no less than twelve equal quarterly installments and (iii) bearing a fair, competitive and commercially reasonable interest rate (the “Note”). The Note, if any, may be prepaid by the Operating Partnership at any time prior to maturity with accrued interest to the date of payment but without premium or penalty. Notwithstanding the foregoing, any amounts that relate to Investments (i) shall be an amount which provides compensation to the Advisor only for that portion of the holding period for the respective Investments during which the Advisor provided services to CPA: 17, (ii) shall not be due and payable until the Investment Asset to which such amount relates is sold or refinanced, and (iii) shall not bear interest until the Investment to which such amount relates is sold or refinanced. A portion of the amount shall be paid as each Investment owned by CPA: 17 on the Termination Date is sold. The portion of such amount payable upon each such sale shall be equal to (i) such amount multiplied by (ii) the percentage calculated by dividing the fair value (at the Termination Date) of the Investment sold by CPA: 17 divided by the total fair value (at the Termination Date) of all Investments owned by CPA: 17 on the Termination Date.

     (d) The Advisor shall promptly upon termination.

     (i) pay over to the Operating Partnership all money collected and held for the account of CPA: 17 pursuant to this Agreement, after deducting any accrued compensation and reimbursement for its expenses to which it is then entitled;

     (ii) deliver to the Board a full accounting, including a statement showing all payments collected by it and a statement of all money held by it, covering the period following the date of the last accounting furnished to the Board;

     (iii) deliver to the Board all assets, including Properties and Loans, and documents of CPA: 17 then in the custody of the Advisor; and

     (iv) cooperate with CPA: 17 to provide an orderly management transition.

     21. Indemnification by CPA: 17 and the Operating Partnership. Neither CPA: 17 nor the Operating Partnership shall indemnify the Advisor or any of its Affiliates for any loss or liability suffered by the Advisor or the Affiliate, or hold the Advisor or the Affiliate harmless for any loss or liability suffered by CPA: 17, except as permitted under Section 7.

     22. Indemnification by Advisor. The Advisor shall indemnify and hold harmless CPA: 17 and the Operating Partnership from liability, claims, damages, taxes or losses and related expenses including attorneys’ fees, to the extent that such liability, claims, damages, taxes or losses and related expenses are not fully reimbursed by insurance and are incurred by reason of the Advisor’s bad faith, fraud, willful misfeasance, misconduct, negligence or reckless disregard of its duties.

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     23. Joint and Several Obligations. Any obligations of CPA: 17 shall be construed as the joint and several obligations of CPA: 17 and the Operating Partnership, unless otherwise specifically provided in this Agreement.

     24. Notices. Any notice, report or other communication required or permitted to be given hereunder shall be in writing unless some other method of giving such notice, report or other communication is accepted by the party to whom it is given, and shall be given by being delivered by hand or by overnight mail or other overnight delivery service to the addresses set forth herein:

To the Board and to CPA: 17:	Corporate Property Associates 17 – Global Incorporated 50 Rockefeller Plaza New York, NY 10020
To the Operating Partnership:	c/o Corporate Property Associates 17 – Global Incorporated 50 Rockefeller Plaza New York, NY 10020
To the Advisor:	Carey Asset Management Corp. 50 Rockefeller Plaza New York, NY 10020

     Either party may at any time give notice in writing to the other party of a change in its address for the purposes of this Section 23.

     25. Modification. This Agreement shall not be changed, modified, terminated, or discharged, in whole or in part, except by an instrument in writing signed by both parties hereto, or their respective successors or assignees.

     26. Severability. The provisions of this Agreement are independent of and severable from each other, and no provision shall be affected or rendered invalid or unenforceable by virtue of the fact that for any reason any other or others of them may be invalid or unenforceable in whole or in part.

     27. Construction. This Agreement shall be governed by, construed and enforced in accordance with the laws of the State of New York.

     28. Entire Agreement. This Agreement contains the entire agreement and understanding among the parties hereto with respect to the subject matter hereof, and supersedes all prior and contemporaneous agreements, understandings, inducements and conditions, express or implied, oral or written, of any nature whatsoever with respect to the subject matter hereof. The express terms hereof control and supersede any course of performance and/or usage of the trade inconsistent with any of the terms hereof. This Agreement may not be modified or amended other than by an agreement in writing.

     29. Indulgences, Not Waivers. Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any other right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver.

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     30. Gender. Words used herein regardless of the number and gender specifically used, shall be deemed and construed to include any other number, singular or plural, and any other gender, masculine, feminine or neuter, as the context requires.

     31. Titles Not to Affect Interpretation. The titles of Sections and subsections contained in this Agreement are for convenience only, and they neither form a part of this Agreement nor are they to be used in the construction or interpretation hereof.

     32. Execution in Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original as against any party whose signature appears thereon, and all of which shall together constitute one and the same instrument. This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories.

     33. Name. W. P. Carey & Co. LLC has a proprietary interest in the name “Corporate Property Associates” and “CPA^®.” Accordingly, and in recognition of this right, if at any time CPA: 17 ceases to retain Carey Asset Management Corp., or an Affiliate thereof to perform the services of Advisor, CPA: 17 will, promptly after receipt of written request from Carey Asset Management Corp., cease to conduct business under or use the name “Corporate Property Associates” or “CPA^®” or any diminutive thereof and CPA: 17 shall use its best efforts to change the name of CPA: 17 to a name that does not contain the name “Corporate Property Associates” or “CPA^®” or any other word or words that might, in the sole discretion of the Advisor, be susceptible of indication of some form of relationship between CPA: 17 and the Advisor or any Affiliate thereof. Consistent with the foregoing, it is specifically recognized that the Advisor or one or more of its Affiliates has in the past and may in the future organize, sponsor or otherwise permit to exist other investment vehicles (including vehicles for investment in real estate) and financial and service organizations having “Corporate Property Associates” or “CPA^®” as a part of their name, all without the need for any consent (and without the right to object thereto) by CPA: 17 or its Directors.

     34. Initial Investment. The Advisor has contributed to CPA: 17 $200,000 in exchange for 22,222 Shares (the “Initial Investment”). The Advisor or its Affiliates may not sell any of the Shares purchased with the Initial Investment during the term of this Agreement. The restrictions included above shall not continue to apply to any Shares other than the Share acquired through the Initial Investment acquired by the Advisor or its Affiliates. The Advisor shall not vote any Shares it now owns or hereafter acquires in any vote for the election of Directors or any vote regarding the approval or termination of any contract with the Advisor or any of its Affiliates.

24

     IN WITNESS WHEREOF, the parties hereto have executed this Advisory Agreement as of the day and year first above written.

CORPORATE PROPERTY ASSOCIATES 17 – GLOBAL INCORPORATED
By:	/s/ Gordon F. DuGan
	Name:	Gordon F. DuGan
	Title:	Chief Executive Officer
CAREY ASSET MANAGEMENT CORP.
By:	/s/ Gordon F. DuGan
	Name:	Gordon F. DuGan
	Title:	President and Chief Executive Officer
CPA:17 LIMITED PARTNERSHIP
By:	/s/ Susan C. Hyde
	Name:	Susan C. Hyde
	Title:	Managing Director and Secretary

SCHEDULE A

     This Schedule sets forth the terms governing any Shares issued by CPA: 17 to the Advisor in payment of advisory fees set forth in the Agreement.

     1. Restrictions. The Shares are subject to vesting over a five-year period. The Shares shall vest ratably over a five-year period with 20% of the Shares paid in each payment vesting on each of the first through fifth anniversary of the date hereof. Prior to the vesting of the ownership of the Shares in the Advisor, the Shares may not be transferred by the Advisor.

     2. Immediate Vesting. Upon the expiration of the Agreement for any reason other than a termination for Cause under paragraph 17 or upon a “Change of Control” of CPA^®:17 (as defined below), all Shares granted to the Advisor hereunder shall vest immediately and all restrictions shall lapse. For purposes of this Schedule A, a “Change of Control” of CPA: 17 shall be deemed to have occurred if there has been a change in the ownership of CPA: 17 of a nature that would be required to be reported in response to the disclosure requirements of Schedule 14A of Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as enacted and in force on the date hereof, whether or not CPA: 17 is then subject to such reporting requirements; provided, however, that, without limitation, a Change of Control shall be deemed to have occurred if:

     (i) any “person,” as such term is used in Sections 13(d) and 14(d) of the Exchange Act (other than CPA: 17, any of its subsidiaries, any trustee, fiduciary or other person or entity holding securities under any employee benefit plan of CPA: 17 or any of its subsidiaries), together with all “affiliates” and “associates” (as such terms are defined in Rule 14b-2 under the Exchange Act) of such person, shall become the “beneficial owner” (as such term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of CPA: 17 representing 25% or more of either (A) the combined voting power of CPA: 17’s then outstanding securities having the right to vote in an election of the Board (“Voting Securities”) or (B) the then outstanding common stock of CPA: 17 (in either such case other than as a result of acquisition of securities directly from CPA: 17);

     (ii) persons who, as of the date hereof, constitute the Board (the “Incumbent Directors”) cease for any reason, including without limitation, as a result of a tender offer, proxy contest, merger or similar transaction, to constitute at least a majority of the Board, provided that any person becoming a director of CPA: 17 subsequent to the date hereof whose election or nomination for election was approved by a vote of at least a majority of the Incumbent Directors shall be considered an Incumbent Director; or

     (iii) the stockholders of CPA: 17 shall approve (A) any consolidation or merger of CPA: 17 or any subsidiary where the stockholders of CPA: 17, immediately prior to the consolidation or merger, would not, immediately after the consolidation or merger, beneficially own (as such term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly, shares representing in the aggregate 50% or more of the voting equity of the entity issuing cash or securities in the consolidation or merger (or of its ultimate parent entity, if any), (B) any sale, lease, exchange or other transfer (in one transaction or a series of transactions contemplated or arranged by any party as a single plan) of all or substantially all of the assets of CPA: 17 or (C) any plan or proposal for the liquidation or dissolution of CPA: 17.

Schedule A-1

     Notwithstanding the foregoing, a “Change of Control” shall not be deemed to have occurred for purposes of the foregoing clause (i) solely as the result of an acquisition of securities by CPA: 17 which, by reducing the number of Shares of Common Stock outstanding, increases (A) the proportionate number of Shares beneficially owned by any person to 25% or more of the Shares then outstanding, or (B) the proportionate voting power represented by the Shares beneficially owned by any person to 25% or more of the combined voting power of all then outstanding voting Securities; provided, however, that if any person referred to in clause (A) or (B) of this sentence shall thereafter become the beneficial owner of any additional Shares or other Voting Securities (other than pursuant to a Share split, Share dividend, or similar transaction), then a “Change of Control” shall be deemed to have occurred for purposes of the foregoing clause (i).

     3. Exception. Notwithstanding anything else in this Agreement to the contrary, the Shares shall continue to vest according to the vesting schedule in Section 1 regardless of: (a) the expiration of the Advisory Agreement for any reason other than a termination by CPA: 17 for Cause or a resignation by the Advisor for other than Good Reason, (b) the merger of CPA: 17 and an Affiliate of CPA: 17 or (c) any “Change of Control” of CPA: 17 in connection with a merger with an Affiliate of CPA: 17.

Schedule A-2

EX-10.2

                                                                    EXHIBIT 10.2

                        AGREEMENT OF LIMITED PARTNERSHIP
                          OF CPA:17 LIMITED PARTNERSHIP

     THIS AGREEMENT OF LIMITED PARTNERSHIP OF CPA:17 LIMITED PARTNERSHIP, a
Delaware limited partnership (the "Partnership"), dated as of November 12, 2007
(the "Effective Date"), is entered into by and among Corporate Property
Associates 17 - Global Incorporated, a Maryland corporation holding both general
partner and limited partner interests in the Partnership (the "General
Partner"), and W. P. Carey Holdings, LLC, a Delaware limited liability company
holding a special general partner interest in the Partnership (the "Special
General Partner"), together with any other Persons who become Partners in the
Partnership as provided herein.

     WHEREAS, the Partnership was formed when a Certificate of Limited
Partnership was filed and accepted by the Secretary of State of the State of
Delaware; and

     WHEREAS, the General Partner proposes to effect an initial offering of its
common stock and to contribute the net proceeds of the offering to the
Partnership to cause the Partnership to fund (i) certain acquisitions and
investments, (ii) working capital requirements, (iii) redemptions of interests
in the Partnership, and (iv) repayment of indebtedness incurred under various
financing instruments.

     NOW, THEREFORE, BE IT RESOLVED, that for good and adequate consideration,
the receipt of which is hereby acknowledged, the parties hereto agree as
follows:

                                   ARTICLE 1.
                                  DEFINED TERMS

SECTION 1.1 DEFINITIONS.

     The following definitions shall be for all purposes, unless otherwise
clearly indicated to the contrary, applied to the terms used in this Agreement.

     "Act" means the Delaware Revised Uniform Limited Partnership Act (6 Del. C.
Section 17-101 et seq.), as it may be amended from time to time, and any
successor to such statute.

     "Additional Funds" shall have the meaning set forth in Section 4.3.A.

     "Additional Limited Partner" means a Person admitted to the Partnership as
a Limited Partner pursuant to Section 12.2 and who is shown as such on the books
and records of the Partnership.

     "Adjusted Capital Account Deficit" means, with respect to any Partner, the
deficit balance, if any, in such Partner's Capital Account as of the end of the
relevant fiscal year, after giving effect to the following adjustments:

     (i)  such deficit shall be decreased by any amounts which such Partner is
          obligated to restore pursuant to this Agreement or is deemed to be
          obligated to restore pursuant to Regulations Section
          1.704-1(b)(2)(ii)(c) or the penultimate sentence of each of
          Regulations Sections 1.704-2(i)(5) and 1.704-2(g)(1); and

     (ii) such deficit shall be increased by the items described in Regulations
          Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6).

     The foregoing definition of Adjusted Capital Account Deficit is intended to
comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and shall
be interpreted consistently therewith. A positive balance in a Partner's Capital
Account, after giving effect to the adjustments described above in clauses (i)
and (ii), is referred to in this Agreement as an "Adjusted Capital Account
Balance."

     "Adjustment Date" means, with respect to any Capital Contribution, the
close of business on the Business Day last preceding the date of the Capital
Contribution, provided, that if such Capital



Contribution is being made by the General Partner in respect of the proceeds
from the issuance of REIT Shares (or the issuance of the General Partner's
securities exercisable for, convertible into or exchangeable for REIT Shares),
then the Adjustment Date shall be as of the close of business on the Business
Day last preceding the date of the issuance of such securities.

     "Advisor" means Carey Asset Management Corp., a Delaware corporation.

     "Advisory Agreement" means that certain Advisory Agreement between the
Advisor and the General Partner entered into contemporaneously with this
Agreement.

     "Affiliate" means, with respect to any Person, any Person directly or
indirectly controlling, controlled by or under common control with such Person.
Control of any Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.

     "Agreed Value" means (i) in the case of any Contributed Property set forth
in Exhibit A and as of the time of its contribution to the Partnership, the
Agreed Value of such property as set forth in Exhibit A; (ii) in the case of any
Contributed Property not set forth in Exhibit A and as of the time of its
contribution to the Partnership, the fair market value of such property or other
consideration as determined by the General Partner, reduced by any liabilities
either assumed by the Partnership upon such contribution or to which such
property is subject when contributed; and (iii) in the case of any property
distributed to a Partner by the Partnership, the fair market value of such
property as determined by the General Partner at the time such property is
distributed, reduced by any liabilities either assumed by such Partner upon such
distribution or to which such property is subject at the time of the
distribution as determined under Section 752 of the Code and the Regulations
thereunder.

     "Agreement" means this Agreement of Limited Partnership, as it may be
amended, modified, supplemented or restated from time to time.

     "Appraisal" means with respect to any assets, the opinion of an independent
third party experienced in the valuation of similar assets, selected by the
General Partner and the Special General Partner in good faith; such opinion may
be in the form of an opinion by such independent third party that the value for
such property or asset as set by the General Partner is fair, from a financial
point of view, to the Partnership.

     "Assignee" means a Person to whom one or more OP Units have been
transferred in a manner permitted under this Agreement, but who has not become a
Substituted Limited Partner, and who has the rights set forth in Section 11.5.

     "Available Cash" means, with respect to any period for which such
calculation is being made, the operating cash flow of the Partnership as
determined in the reasonable discretion of the General Partner in accordance
with United States generally accepted accounting principles, taking into account
all cash available for distribution from all sources, and to the extent
appropriate, the operating cash flow of any entity in which the Partnership owns
an interest multiplied by the percentage ownership of such entity by the
Partnership.

     "Available Cash from Long-Term Net Leased Properties" means that portion of
Available Cash attributable to long-term, net leased properties, as determined
by the General Partner in its reasonable discretion.

     "Available Cash from Real Estate Related Loans" means that portion of
Available Cash attributable to the Partnership's investments in B notes,
mortgage backed securities and real estate related loans, as determined by the
General Partner in its reasonable discretion.


                                      -2-



     "Available Cash from Real Estate Securities" means that portion of
Available Cash attributable to the Partnership's investments in readily
marketable real estate securities (other than investments in B notes, mortgage
backed securities and real estate related loans), as determined by the General
Partner in its reasonable discretion.

     "Available Residual Cash" means Available Cash, other than (i) Available
Cash from Long-Term Net Leased Properties, (ii) Available Cash from Real Estate
Related Loans, and (iii) Available Cash from Real Estate Securities.

     "Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in New York, New York are authorized or required by law
to be closed.

     "Capital Account" means, with respect to any Partner, the Capital Account
maintained for such Partner in accordance with the following provisions:

     (a) To each Partner's Capital Account there shall be added such Partner's
Capital Contributions, such Partner's share of Net Income and any items in the
nature of income or gain which are specially allocated pursuant to Section 6.3,
and the amount of any Partnership liabilities assumed by such Partner or which
are secured by any property distributed to such Partner.

     (b) From each Partner's Capital Account there shall be subtracted the
amount of cash and the Gross Asset Value of any property distributed to such
Partner pursuant to any provision of this Agreement, such Partner's distributive
share of Net Loss and any items in the nature of expenses or losses which are
specially allocated pursuant to Section 6.3, and the amount of any liabilities
of such Partner assumed by the Partnership or which are secured by any property
contributed by such Partner to the Partnership (except to the extent already
reflected in the amount of such Partner's Capital Contribution).

     (c) In the event any interest in the Partnership is transferred in
accordance with the terms of this Agreement, the transferee shall succeed to the
Capital Account of the transferor to the extent it relates to the transferred
interest.

     (d) In determining the amount of any liability for purposes of subsections
(a) and (b) hereof, there shall be taken into account Code Section 752(c) and
any other applicable provisions of the Code and Regulations.

     (e) The foregoing provisions and the other provisions of this Agreement
relating to the maintenance of Capital Accounts are intended to comply with
Regulations Sections 1.704-1(b) and 1.704-2, and shall be interpreted and
applied in a manner consistent with such Regulations. In the event the General
Partner shall determine that it is prudent to modify the manner in which the
Capital Accounts, or any debits or credits thereto (including, without
limitation, debits or credits relating to liabilities which are secured by
contributed or distributed property or which are assumed by the Partnership, the
General Partner, or the Limited Partners) are computed in order to comply with
such Regulations, the General Partner may make such modification, provided that
it is not likely to have a material effect on the amounts distributable to any
Person pursuant to Article 13 of this Agreement upon the dissolution of the
Partnership. The General Partner also shall (i) make any adjustments that are
necessary or appropriate to maintain equality between the Capital Accounts of
the Partners and the amount of Partnership capital reflected on the
Partnership's balance sheet, as computed for book purposes, in accordance with
Regulations Section 1.704-1(b)(2)(iv)(q), and (ii) make any appropriate
modifications in the event unanticipated events might otherwise cause this
Agreement not to comply with Regulations Section 1.704-1(b) or Section 1.704-2.

     "Capital Contribution" means, with respect to any Partner, the amount of
money and the initial Gross Asset Value of any property (other than money)
contributed to the Partnership by such Partner (net of any


                                      -3-



liabilities assumed by the Partnership relating to such property and any
liability to which such property is subject).

     "Capital Proceeds" means the gross receipts received by the Partnership
from a Capital Transaction, less any expenses related to the Capital
Transaction.

     "Capital Transaction" means any transaction outside the ordinary course of
the Partnership's business involving the sale, exchange, other disposition, or
refinancing of any Partnership asset.

     "Cash Amount" means, with respect to any OP Units subject to a Redemption,
an amount of cash equal to the Deemed Partnership Interest Value attributable to
such OP Units.

     "Certificate" means the Certificate of Limited Partnership relating to the
Partnership filed in the office of the Secretary of the State of the State of
Delaware, as amended from time to time in accordance with the terms hereof and
the Act.

     "Change of Control" shall be deemed to have occurred at such time as (i)
the date a "person" or "group" (within the meaning of Sections 13(d) and 14(d)
of the Exchange Act) becomes the ultimate "beneficial owner" (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act, except that a person or group
shall be deemed to have beneficial ownership of all shares of voting stock that
such person or group has the right to acquire regardless of when such right is
first exercisable), directly or indirectly, of voting stock representing more
than 50% of the total voting power of the total voting stock of the General
Partner; (ii) the date the General Partner sells, transfers or otherwise
disposes of all or substantially all of its assets; or (iii) the date of the
consummation of a merger or share exchange of the General Partner with another
entity where the General Partner's stockholders immediately prior to the merger
or share exchange would not beneficially own, immediately after the merger or
share exchange, shares representing 50% or more of all votes (without
consideration of the rights of any class of stock to elect directors by a
separate group vote) to which all stockholders of the corporation issuing cash
or securities in the merger or share exchange would be entitled in the election
of directors, or where members of the board of directors of the General Partner
immediately prior to the merger or share exchange would not immediately after
the merger or share exchange constitute a majority of the board of directors of
the corporation issuing cash or securities in the merger or share exchange.

     "Charter" means the Articles of Incorporation of the General Partner filed
with the State Department of Assessments and Taxation of Maryland on February 9,
2007, as amended or restated from time to time.

     "Code" means the Internal Revenue Code of 1986, as amended from time to
time or any successor statute thereto. Any reference herein to a specific
section or sections of the Code shall be deemed to include a reference to any
corresponding provision of future law.

     "Consent" means the consent to, approval of, or vote on a proposed action
by a Partner given in accordance with Article 14.

     "Consent of the Limited Partners" means the Consent of a Majority in
Interest of the Limited Partners, which Consent shall be obtained prior to the
taking of any action for which it is required by this Agreement and may be given
or withheld by a Majority in Interest of the Limited Partners, unless otherwise
expressly provided herein, in their sole and absolute discretion.

     "Consent of the Partners" means the Consent of Partners holding Percentage
Interests that in the aggregate are equal to or greater than fifty percent (50%)
of the aggregate Percentage Interests of all Partners, which Consent shall be
obtained prior to the taking of any action for which it is required by this
Agreement and may be given or withheld by such Partners, in their sole and
absolute discretion.


                                       -4-



     "Constructively Own" means ownership under the constructive ownership rules
described in Exhibit C.

     "Contributed Property" means each property or other asset, in such form as
may be permitted by the Act, but excluding cash, contributed or deemed
contributed to the Partnership.

     "Debt" means, as to any Person, as of any date of determination, (i) all
indebtedness of such Person for borrowed money or for the deferred purchase
price of property or services; (ii) all amounts owed by such Person to banks or
other Persons in respect of reimbursement obligations under letters of credit,
surety bonds, guarantees and other similar instruments guaranteeing payment or
other performance of obligations by such Person; (iii) all indebtedness for
borrowed money or for the deferred purchase price of property or services
secured by any lien on any property owned by such Person, to the extent
attributable to such Person's interest in such property, even though such Person
has not assumed or become liable for the payment thereof; and (iv) lease
obligations of such Person which, in accordance with generally accepted
accounting principles, should be capitalized.

     "Deemed Partnership Interest Value" means, as of any date with respect to
any class of Partnership Interests, the Deemed Value of the Partnership
Interests of such class multiplied by the Partner's relative Percentage Interest
of such class.

     "Deemed Value of the Partnership Interests" means, as of any date with
respect to any class or series of Partnership Interests, (i) the total number of
OP Units of the General Partner issued and outstanding as of the close of
business on such date multiplied by the Fair Market Value determined as of such
date of a share of common stock of the General Partner which corresponds to such
Partnership Interest, as adjusted (x) pursuant to Section 7.5 (in the event the
General Partner acquires material assets, other than on behalf of the
Partnership) and (y) for stock dividends and distributions, stock splits and
subdivisions, reverse stock splits and combinations, distribution of warrants or
options and distributions of evidences of indebtedness or assets not received by
the General Partner pursuant to a pro rata distribution by the Partnership; (ii)
divided by the Percentage Interest of the General Partner on such date;
provided, that if no outstanding shares of capital stock of the General Partner
correspond to a class or series of Partnership Interests, the Deemed Value of
the Partnership Interests with respect to such class or series shall be equal to
an amount reasonably determined by the General Partner.

     "Depreciation" means, for each fiscal year or other period, an amount equal
to the depreciation, amortization or other cost recovery deduction allowable
with respect to an asset for such year or other period, except that if the Gross
Asset Value of an asset differs from its adjusted basis for federal income tax
purposes at the beginning of such year or other period, Depreciation shall be an
amount which bears the same ratio to such beginning Gross Asset Value as the
federal income tax depreciation, amortization or other cost recovery deduction
for such year or other period bears to such beginning adjusted tax basis;
provided, however, that if the federal income tax depreciation, amortization or
other cost recovery deduction for such year is zero, Depreciation shall be
determined with reference to such beginning Gross Asset Value using any
reasonable method selected by the General Partner.

     "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.

     "Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Securities and Exchange Commission promulgated
thereunder and any successor statute thereto.

     "Fair Market Value" means, with respect to any share of capital stock of
the General Partner, (i) if such shares are listed or admitted to trading on any
securities exchange or the Nasdaq National Market, the average of the daily
market price for the ten (10) consecutive trading days immediately preceding the
date with respect to which "Fair Market Value" must be determined hereunder or,
if such date is not a Business


                                      -5-



Day, the immediately preceding Business Day, using as the market price for each
such trading day the closing price, regular way, on such day, or if no such sale
takes place on such day, the average of the closing bid and asked prices on such
day, or (ii) if such shares are not listed or admitted to trading on any
securities exchange or the Nasdaq National Market, the price at which such
shares are then being offered to the public pursuant to any public offering of
the General Partner or pursuant to its distribution reinvestment plan (before
giving effect to any discounts in effect and made available to participants in
such plan); provided that, if there is no ongoing public offering or if the
General Partner is not then offering its shares pursuant to a distribution
reinvestment plan, the Fair Market Value of such shares shall be determined by
the General Partner acting in good faith on the basis of the most recent,
publicly reported net asset value of the General Partner and other information
as it considers, in its reasonable judgment, appropriate. In the event the REIT
Shares Amount for such shares includes rights that a holder of such shares would
be entitled to receive, then the Fair Market Value of such rights shall be
determined by the General Partner acting in good faith on the basis of such
quotations and other information as it considers, in its reasonable judgment,
appropriate; and provided, further that, in connection with determining the
Deemed Value of the Partnership Interests for purposes of determining the number
of additional OP Units issuable upon a Capital Contribution funded by an
underwritten public offering of shares of capital stock of the General Partner,
the Fair Market Value of such shares shall be the public offering price per
share of such class of capital stock sold. Notwithstanding the foregoing, the
General Partner in its reasonable discretion may use a different "Fair Market
Value" for purposes of making the determinations under subparagraph (b) of the
definition of "Gross Asset Value" and Section 4.3.D in connection with the
contribution of Property or cash to the Partnership by a third party, provided
such value shall be based upon the value per REIT Share (or per OP Unit) agreed
upon by the General Partner and such third party for purposes of such
contribution.

     "General Partner Interest" means a Partnership Interest held by the General
Partner. A General Partner Interest may be expressed as a number of OP Units.

     "General Partner Net Current Investment" means the General Partner's total
Capital Contributions then paid to the Partnership, plus the amount of any
Partnership liabilities assumed by the General Partner (or which are secured by
Partnership property distributed to the General Partner), less (i) the amount of
any liabilities of the General Partner assumed by the Partnership (or which are
secured by property contributed by the General Partner to the Partnership), (ii)
all amounts actually distributed to the General Partner pursuant to Section
5.1.B(2), and (iii) all amounts representing a return of capital to the General
Partner, including, but not limited to, the portion of any redemption proceeds
distributed to the General Partner pursuant to Section 11.8 which represents a
return of capital to the General Partner.

     "General Partner Priority Return" means an amount equal to six percent (6%)
per annum of the Weighted Average General Partner Net Current Investment,
payable to the General Partner annually on a cumulative basis.

     "General Partner Unpaid Priority Return" means the excess, if any, of the
General Partner Priority Return over all amounts previously paid to the General
Partner under Section 5.1.A, or paid in respect of the General Partner Priority
Return under Section 5.1.B(1) as of the time in question.

     "Gross Asset Value" means, with respect to any asset, the asset's adjusted
basis for federal income tax purposes, except as follows:

     (a) The initial Gross Asset Value of any asset contributed by a Partner to
the Partnership shall be the gross fair market value of such asset, as
determined by the contributing Partner and the General Partner (as set forth on
Exhibit A attached hereto, as such Exhibit may be amended from time to time);
provided, that if the contributing Partner is the General Partner, then, except
with respect to the General Partner's initial Capital Contribution which shall
be determined as set forth on Exhibit A, the determination of the fair market
value of the contributed asset shall be determined (i) by the price paid by the
General Partner if the asset is acquired by the General Partner
contemporaneously with its contribution to the Partnership, (ii) by


                                      -6-



Appraisal, if otherwise acquired by the General Partner, (iii) by the amount of
cash if the asset is cash, and (iv) as reasonably determined by the General
Partner if the asset is REIT Shares or other shares of capital stock of the
General Partner.

     (b) The Gross Asset Values of all Partnership assets shall be adjusted to
equal their respective gross fair market values, as determined by the General
Partner using such reasonable method of valuation as it may adopt, provided,
however, that for such purpose, the net value of all of the Partnership assets,
in the aggregate, shall be equal to the Deemed Value of the Partnership
Interests of all classes of Partnership Interests then outstanding, regardless
of the method of valuation adopted by the General Partner, immediately prior to
the times listed below:

     (i)  the acquisition of an additional interest in the Partnership by a new
          or existing Partner in exchange for more than a de minimis Capital
          Contribution, if the General Partner reasonably determines that such
          adjustment is necessary or appropriate to reflect the relative
          economic interests of the Partners in the Partnership;

     (ii) the distribution by the Partnership to a Partner of more than a de
          minimis amount of Partnership property as consideration for an
          interest in the Partnership if the General Partner reasonably
          determines that such adjustment is necessary or appropriate to reflect
          the relative economic interests of the Partners in the Partnership;

     (iii) the liquidation of the Partnership within the meaning of Regulations
          Section 1.704-1(b)(2)(ii)(g);

     (iv) at such other times as the General Partner shall reasonably determine
          necessary or advisable in order to comply with Regulations Sections
          1.704-1(b) and 1.704-2; and

     (v)  in connection with the grant of an interest in the Partnership (other
          than a de minimis interest) as consideration for the provision of
          services to or for the benefit of the Partnership by an existing
          Partner acting in a partner capacity or by a new Partner acting in a
          partner capacity or in anticipation of becoming a Partner.

     (c) The Gross Asset Value of any Partnership asset distributed to a Partner
shall be the gross fair market value of such asset on the date of distribution
as determined by the distributee and the General Partner, or if the distributee
and the General Partner cannot agree on such a determination, by Appraisal.

     (d) The Gross Asset Values of Partnership assets shall be increased (or
decreased) to reflect any adjustments to the adjusted basis of such assets
pursuant to Code Section 734(b) or Code Section 743(b), but only to the extent
that such adjustments are taken into account in determining Capital Accounts
pursuant to Regulations Section 1.704-1(b)(2)(iv)(m); provided, however, that
Gross Asset Values shall not be adjusted pursuant to this subparagraph (d) to
the extent that the General Partner reasonably determines that an adjustment
pursuant to subparagraph (b) is necessary or appropriate in connection with a
transaction that would otherwise result in an adjustment pursuant to this
subparagraph (d).

     (e) If the Gross Asset Value of a Partnership asset has been determined or
adjusted pursuant to subparagraph (a), (b) or (d), such Gross Asset Value shall
thereafter be adjusted by the Depreciation taken into account with respect to
such asset for purposes of computing Net Income and Net Loss.

     "Immediate Family" means, with respect to any natural Person, such natural
Person's estate or heirs or current spouse or former spouse, parents,
parents-in-law, children (whether natural, adopted or by marriage), siblings and
grandchildren and any trust or estate, all of the beneficiaries of which consist
of such Person or such Person's spouse or former spouse, parents,
parents-in-law, children, siblings or grandchildren.


                                      -7-



     "Incapacity" or "Incapacitated" means, (i) as to any individual Partner,
death, total physical disability or entry by a court of competent jurisdiction
adjudicating him or her incompetent to manage his or her Person or his or her
estate; (ii) as to any corporation which is a Partner, the filing of a
certificate of dissolution, or its equivalent, for the corporation or the
revocation of its charter; (iii) as to any partnership which is a Partner, the
dissolution and commencement of winding up of the partnership; (iv) as to any
estate which is a Partner, the distribution by the fiduciary of the estate's
entire interest in the Partnership; (v) as to any trustee of a trust which is a
Partner, the termination of the trust (but not the substitution of a new
trustee); or (vi) as to any Partner, the bankruptcy of such Partner. For
purposes of this definition, bankruptcy of a Partner shall be deemed to have
occurred when (a) the Partner commences a voluntary proceeding seeking
liquidation, reorganization or other relief under any bankruptcy, insolvency or
other similar law now or hereafter in effect, (b) the Partner is adjudged as
bankrupt or insolvent, or a final and nonappealable order for relief under any
bankruptcy, insolvency or similar law now or hereafter in effect has been
entered against the Partner, (c) the Partner executes and delivers a general
assignment for the benefit of the Partner's creditors, (d) the Partner files an
answer or other pleading admitting or failing to contest the material
allegations of a petition filed against the Partner in any proceeding of the
nature described in clause (b) above, (e) the Partner seeks, consents to or
acquiesces in the appointment of a trustee, receiver or liquidator for the
Partner or for all or any substantial part of the Partner's properties, (f) any
proceeding seeking liquidation, reorganization or other relief under any
bankruptcy, insolvency or other similar law now or hereafter in effect has not
been dismissed within 120 days after the commencement thereof, (g) the
appointment without the Partner's consent or acquiescence of a trustee, receiver
or liquidator has not been vacated or stayed within 90 days of such appointment,
or (h) an appointment referred to in clause (g) is not vacated within 90 days
after the expiration of any such stay.

     "Indemnitee" means (i) any Person subject to a claim or demand or made or
threatened to be made a party to, or involved or threatened to be involved in,
an action, suit or proceeding by reason of his or her status as (A) the General
Partner or (B) a director, officer or employee of the Partnership or the General
Partner, and (ii) such other Persons (including Affiliates of the General
Partner or the Partnership) as the General Partner may designate from time to
time (whether before or after the event giving rise to potential liability), in
its sole and absolute discretion.

     "Investments" means investments made by the Partnership, directly or
indirectly, in a Property, Loan or Other Permitted Investment Asset.

     "IRS" means the United States Internal Revenue Service.

     "Limited Partner" means any Person named as a Limited Partner in Exhibit A
attached hereto, as such Exhibit may be amended from time to time, or any
Substituted Limited Partner or Additional Limited Partner, in such Person's
capacity as a Limited Partner in the Partnership.

     "Limited Partner Interest" means a Partnership Interest of a Limited
Partner representing a fractional part of the Partnership Interests of all
Limited Partners and includes any and all benefits to which the holder of such a
Partnership Interest may be entitled as provided in this Agreement, together
with all obligations of such Person to comply with the terms and provisions of
this Agreement. A Limited Partner Interest may be expressed as a number of OP
Units.

     "Liquidating Event" shall have the meaning set forth in Section 13.1.

     "Loans" means notes and other evidences of indebtedness or obligations
acquired, originated or entered into, directly or indirectly, by the Partnership
as lender, noteholder, participant, note purchaser or other capacity, including
but not limited to first or subordinate mortgage loans, construction loans,
development loans, loan participations, B notes, loans secured by capital stock
or any other assets or form of equity interest and any other type of loan or
financial arrangement, such as providing or arranging for


                                      -8-



letters of credit, providing guarantees of obligations to third parties, or
providing commitments for loans. Loans shall not include leases which are not
recognized as leases for federal income tax reporting purposes.

     "Liquidator" shall have the meaning set forth in Section 13.2.A.

     "Majority in Interest of the Limited Partners" means Limited Partners
holding in the aggregate Percentage Interests that are greater than fifty
percent (50%) of the aggregate Percentage Interests of all Limited Partners.

     "Net Income" or "Net Loss" means for each fiscal year of the Partnership,
an amount equal to the Partnership's taxable income or loss for such fiscal
year, determined in accordance with Code Section 703(a) (for this purpose, all
items of income, gain, loss, or deduction required to be stated separately
pursuant to Code Section 703(a)(1) shall be included in taxable income or loss),
with the following adjustments:

     (a) Any income of the Partnership that is exempt from federal income tax
and not otherwise taken into account in computing Net Income or Net Loss
pursuant to this definition of Net Income or Net Loss shall be added to such
taxable income or loss;

     (b) Any expenditures of the Partnership described in Code Section
705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures pursuant to
Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account
in computing Net Income or Net Loss pursuant to this definition of Net Income or
Net Loss shall be subtracted from such taxable income or loss;

     (c) In the event the Gross Asset Value of any Partnership asset is adjusted
pursuant to subparagraph (b) or subparagraph (c) of the definition of Gross
Asset Value, the amount of such adjustment shall be taken into account as gain
or loss from the disposition of such asset for purposes of computing Net Income
or Net Loss;

     (d) Gain or loss resulting from any disposition of property with respect to
which gain or loss is recognized for federal income tax purposes shall be
computed by reference to the Gross Asset Value of the property disposed of,
notwithstanding that the adjusted tax basis of such property differs from its
Gross Asset Value;

     (e) In lieu of the depreciation, amortization, and other cost recovery
deductions taken into account in computing such taxable income or loss, there
shall be taken into account Depreciation for such fiscal year;

     (f) To the extent an adjustment to the adjusted tax basis of any
Partnership asset pursuant to Code Section 734(b) or Code Section 743(b) is
required pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(4) to be taken
into account in determining Capital Accounts as a result of a distribution other
than in liquidation of a Partner's interest in the Partnership, the amount of
such adjustment shall be treated as an item of gain (if the adjustment increases
the basis of the asset) or loss (if the adjustment decreases the basis of the
asset) from the disposition of the asset and shall be taken into account for
purposes of computing Net Income or Net Loss; and

     (g) Notwithstanding any other provision of this definition of Net Income or
Net Loss, any items which are specially allocated pursuant to Section 6.3 shall
not be taken into account in computing Net Income or Net Loss. The amounts of
the items of Partnership income, gain, loss, or deduction available to be
specially allocated pursuant to Section 6.3 shall be determined by applying
rules analogous to those set forth in this definition of Net Income or Net Loss.

     "Net Income from a Capital Transaction" means that portion of Net Income
attributable to a Capital Transaction.


                                       -9-



     "Net Income from Long-Term Net Leased Properties" means that portion of Net
Income attributable to long-term, net leased properties, as determined by the
General Partner in its reasonable discretion.

     "Net Income from Real Estate Related Loans" means that portion of Net
Income attributable to the Partnership's investments in B notes, mortgage backed
securities and real estate related loans, as determined by the General Partner
in its reasonable discretion.

     "Net Income from Real Estate Securities" means that portion of Net Income
attributable to the Partnership's investments in readily marketable real estate
securities (other than B notes, mortgage backed securities and real estate
related loans), as determined by the General Partner in its reasonable
discretion.

     "Net Loss from a Capital Transaction" means that portion of Net Loss
attributable to a Capital Transaction.

     "Net Residual Income" means Net Income, other than (i) Net Income from
Long-Term Net Leased Properties, (ii) Net Income from Real Estate Related Loans,
and (iii) Net Income from Real Estate Securities.

     "New Securities" means (i) any rights, options, warrants or convertible or
exchangeable securities having the right to subscribe for or purchase REIT
Shares or other shares of common stock of the General Partner, or (ii) any Debt
issued by the General Partner that provides any of the rights described in
clause (i).

     "Nonrecourse Deductions" shall have the meaning set forth in Regulations
Section 1.704-2(b)(1), and the amount of Nonrecourse Deductions for a
Partnership Year shall be determined in accordance with the rules of Regulations
Section 1.704-2(c).

     "Nonrecourse Liability" shall have the meaning set forth in Regulations
Section 1.752-1(a)(2).

     "Notice of Redemption" means the Notice of Redemption substantially in the
form of Exhibit B to this Agreement.

     "OP Unit" means a fractional share of the Partnership Interests of all
Partners issued pursuant to Article 4.

     "Other Permitted Investment Asset" means assets, other than cash, cash
equivalents, short term bonds, auction rate securities and similar short term
investments, acquired by the Partnership for investment purposes that is not a
Loan or a Property and is consistent with the investment objectives and policies
of the Partnership.

     "Partner" means a General Partner, a Special General Partner, or a Limited
Partner, and "Partners" means the General Partner, the Special General Partner
and the Limited Partners.

     "Partner Minimum Gain" means an amount, with respect to each Partner
Nonrecourse Debt, equal to the Partnership Minimum Gain that would result if
such Partner Nonrecourse Debt were treated as a Nonrecourse Liability,
determined in accordance with Regulations Section 1.704-2(i)(3).

     "Partner Nonrecourse Debt" shall have the meaning set forth in Regulations
Section 1.704-2(b)(4).

     "Partner Nonrecourse Deductions" shall have the meaning set forth in
Regulations Section 1.704-2(i)(2), and the amount of Partner Nonrecourse
Deductions with respect to a Partner Nonrecourse Debt for a Partnership Year
shall be determined in accordance with the rules of Regulations Section
1.704-2(i)(2).


                                      -10-



     "Partnership" means the limited partnership formed under the Act and
pursuant to this Agreement, and any successor thereto.

     "Partnership Interest" means, an ownership interest in the Partnership of
either a Limited Partner, the Special General Partner, or the General Partner
and includes any and all benefits to which the holder of such a Partnership
Interest may be entitled as provided in this Agreement, together with all
obligations of such Person to comply with the terms and provisions of this
Agreement. There may be one or more classes or series of Partnership Interests
as provided in Section 4.3. Except as otherwise provided for in this Agreement,
a Partnership Interest may be expressed as a number of OP Units. Unless
otherwise expressly provided for in this Agreement or by the General Partner at
the time of the original issuance of any Partnership Interests, all Partnership
Interests (whether of a Limited Partner, a Special General Partner or a General
Partner) shall be of the same class or series.

     "Partnership Minimum Gain" shall have the meaning set forth in Regulations
Section 1.704-2(b)(2), and the amount of Partnership Minimum Gain, as well as
any net increase or decrease in Partnership Minimum Gain, for a Partnership Year
shall be determined in accordance with the rules of Regulations Section
1.704-2(d).

     "Partnership Record Date" means the record date established by the General
Partner for the distribution of Available Cash pursuant to Section 5.1 which
record date shall be the same as the record date established by the General
Partner for a distribution to its stockholders of some or all of its portion of
such distribution.

     "Partnership Year" means the fiscal year of the Partnership, which shall be
the calendar year.

     "Percentage Interest" means, as to a Partner holding a class or series of
Partnership Interests, its interest as determined, as of the first day of each
Partnership Year, by dividing such Partner's Adjusted Capital Account Balance by
aggregate Adjusted Capital Account Balances of all Partners. For purposes of the
preceding sentence, the Adjusted Capital Account Balances of the Partners shall
be determined after giving effect to all allocations of Net Income and Net Loss
for all preceding Partnership Years, including allocations of Net Income and Net
Loss resulting from adjustments to the Gross Asset Value of the Partnership's
assets pursuant to the definition of Gross Asset Value.

     "Person" means an individual, corporation, partnership, limited liability
company, trust, unincorporated organization, association or other entity.

     "Plan Asset Regulation" means the regulations promulgated by the United
States Department of Labor in Title 29, Code of Federal Regulations, Part 2510,
Section 101.3, and any successor regulations thereto.

     "Pledge" shall have the meaning set forth in Section 11.3.A.

     "Property" or "Properties" means a partial or entire interest in real
property (including leasehold interests) and personal or mixed property
connected therewith. An Investment which obligates the Partnership to acquire a
Property will be treated as a Property for purposes of this Agreement.

     "Qualifying Party" means (a) an Additional Limited Partner; (b) a Family
Member, or a lending institution as the pledgee of a Pledge, who is the
transferee in a Permitted Transfer; or (c) a Substituted Limited Partner
succeeding to all or part of the Limited Partner Interest of (i) an Additional
Limited Partner or (ii) a Family Member, or a lending institution who is the
pledgee of a Pledge, who is the transferee in a Permitted Transfer.


                                      -11-



     "Qualified REIT Subsidiary" means any Subsidiary of the General Partner
that is a "qualified REIT subsidiary" within the meaning of Section 856(i) of
the Code.

     "Qualified Transferee" means an "Accredited Investor" as such term is
defined in Rule 501 promulgated under the Securities Act.

     "Redemption" shall have the meaning set forth in Section 8.6.A.

     "Regulations" means the Treasury Regulations promulgated under the Code, as
such regulations may be amended from time to time (including corresponding
provisions of succeeding regulations).

     "Regulatory Allocations" shall have the meaning set forth in Section 6.3.

     "REIT" means a real estate investment trust, as defined under Sections 856
through 860 of the Code.

     "REIT Requirements" shall have the meaning set forth in Section 5.1.

     "REIT Share" means a share of common stock, par value $0.001 per share, of
the General Partner.

     "REIT Shares Amount" means, as of any date, an aggregate number of REIT
Shares equal to the number of Tendered Units, as adjusted (x) pursuant to
Section 7.5 (in the event the General Partner acquires material assets, other
than on behalf of the Partnership) and (y) for stock dividends and
distributions, stock splits and subdivisions, reverse stock splits and
combinations, distributions of rights, warrants or options, and distributions of
evidences of indebtedness or assets relating to assets not received by the
General Partner pursuant to a pro rata distribution by the Partnership.

     "Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Securities and Exchange Commission promulgated
thereunder and any successor statute thereto.

     "Special General Partner Interest" means a Partnership Interest held by the
Special General Partner. A Special General Partner Interest may be expressed as
a number of OP Units, but only to the extent that the Special General Partner
makes Capital Contributions to the Partnership.

     "Specified Redemption Date" means the day of receipt by the General Partner
of a Notice of Redemption.

     "Subsidiary" means, with respect to any Person, any corporation,
partnership, limited liability company, joint venture or other entity of which a
majority of (i) the voting power of the voting equity securities or (ii) the
outstanding equity interests is owned, directly or indirectly, by such Person.

     "Subsidiary Partnership" means any partnership or limited liability company
that is a Subsidiary of the Partnership.

     "Substituted Limited Partner" means a Person who is admitted as a Limited
Partner to the Partnership pursuant to Section 11.4.

     "Tax Items" shall have the meaning set forth in Section 6.4.A.

     "Tenant" means any tenant from which the General Partner derives rent
either directly or indirectly through partnerships, including the Partnership,
or Qualified REIT Subsidiaries.

     "Tendered Units" shall have the meaning set forth in Section 8.6.A.


                                      -12-



     "Tendering Partner" shall have the meaning set forth in Section 8.6.A.

     "Weighted Average General Partner Net Current Investment" means the annual
average balance of the General Partner Net Current Investment computed on a
daily basis.

                                   ARTICLE 2.
                             ORGANIZATIONAL MATTERS

SECTION 2.1 ORGANIZATION

     The Partnership is a limited partnership formed pursuant to the provisions
of the Act and upon the terms and conditions set forth in this Agreement. Except
as expressly provided herein, the rights and obligations of the Partners and the
administration and termination of the Partnership shall be governed by the Act.
The Partnership Interest of each Partner shall be personal property for all
purposes.

SECTION 2.2 NAME

     The name of the Partnership is CPA:17 Limited Partnership. The
Partnership's business may be conducted under any other name or names deemed
advisable by the General Partner, including the name of the General Partner or
any Affiliate thereof. The words "Limited Partnership," "L.P.," "Ltd." or
similar words or letters shall be included in the Partnership's name where
necessary for the purposes of complying with the laws of any jurisdiction that
so requires. The General Partner in its sole and absolute discretion may change
the name of the Partnership at any time and from time to time and shall notify
the Limited Partners of such change in the next regular communication to the
Limited Partners.

SECTION 2.3 REGISTERED OFFICE AND AGENT; PRINCIPAL OFFICE

     The name and address of the registered office and registered agent of the
Partnership is Corporation Service Company, 2711 Centerville Road, Suite 400,
Wilmington, DE 19808. The principal office of the Partnership is located at 50
Rockefeller Plaza, New York, New York 10020, or such other place as the General
Partner may from time to time designate by notice to the other Partners. The
Partnership may maintain offices at such other place or places within or outside
the State of Delaware as the General Partner deems advisable.

SECTION 2.4 POWER OF ATTORNEY

     A. Each Limited Partner and each Assignee constitutes and appoints the
General Partner, any Liquidator, and authorized officers and attorneys-in-fact
of each, and each of those acting singly, in each case with full power of
substitution, as its true and lawful agent and attorney-in-fact, with full power
and authority in its name, place and stead to:

          (1) execute, swear to, acknowledge, deliver, file and record in the
appropriate public offices (a) all certificates, documents and other instruments
(including, without limitation, this Agreement and the Certificate and all
amendments or restatements thereof) that the General Partner or the Liquidator
deems appropriate or necessary to form, qualify or continue the existence or
qualification of the Partnership as a limited partnership (or a partnership in
which the Limited Partners have limited liability) in the State of Delaware and
in all other jurisdictions in which the Partnership may conduct business or own
property; (b) all instruments that the General Partner or any Liquidator deems
appropriate or necessary to reflect any amendment, change, modification or
restatement of this Agreement in accordance with its terms; (c) all conveyances
and other instruments or documents that the General Partner or any Liquidator
deems appropriate or necessary to reflect the dissolution and liquidation of the
Partnership pursuant to the terms of this Agreement, including, without
limitation, a certificate of cancellation; (d) all instruments relating to the
admission, withdrawal, removal or substitution of any Partner pursuant to, or
other events described in, Articles 11, 12 or 13 or the Capital Contribution of
any Partner; and (e) all certificates, documents and


                                      -13-



other instruments relating to the determination of the rights, preferences and
privileges of Partnership Interests; and

          (2) execute, swear to, acknowledge and file all ballots, consents,
approvals, waivers, certificates and other instruments appropriate or necessary,
in the sole and absolute discretion of the General Partner or any Liquidator, to
make, evidence, give, confirm or ratify any vote, consent, approval, agreement
or other action which is made or given by the Partners hereunder or is
consistent with the terms of this Agreement or appropriate or necessary, in the
sole discretion of the General Partner or any Liquidator, to effectuate the
terms or intent of this Agreement. Nothing contained herein shall be construed
as authorizing the General Partner or any Liquidator to amend this Agreement
except in accordance with Article 14 or as may be otherwise expressly provided
for in this Agreement.

     B. The foregoing power of attorney is hereby declared to be irrevocable and
a power coupled with an interest, in recognition of the fact that each of the
Partners will be relying upon the power of the General Partner and any
Liquidator to act as contemplated by this Agreement in any filing or other
action by it on behalf of the Partnership, and it shall survive and not be
affected by the subsequent Incapacity of any Limited Partner or Assignee and the
transfer of all or any portion of such Limited Partner's or Assignee's OP Units
and shall extend to such Limited Partner's or Assignee's heirs, successors,
assigns and personal representatives. Each such Limited Partner or Assignee
hereby agrees to be bound by any representation made by the General Partner or
any Liquidator, acting in good faith pursuant to such power of attorney; and
each such Limited Partner or Assignee hereby waives any and all defenses which
may be available to contest, negate or disaffirm the action of the General
Partner or any Liquidator, taken in good faith under such power of attorney.
Each Limited Partner or Assignee shall execute and deliver to the General
Partner or any Liquidator, within 15 days after receipt of the General Partner's
or Liquidator's request therefor, such further designation, powers of attorney
and other instruments as the General Partner or the Liquidator, as the case may
be, deems necessary to effectuate this Agreement and the purposes of the
Partnership.

SECTION 2.5 TERM

     The term of the Partnership commenced on the date of its formation and the
Partnership shall have a perpetual existence unless it is dissolved pursuant to
the provisions of Article 13 or as otherwise provided by law.

                                   ARTICLE 3.
                                     PURPOSE

SECTION 3.1 PURPOSE AND BUSINESS

     The purpose and nature of the business to be conducted by the Partnership
is to (i) conduct any business that may be lawfully conducted by a limited
partnership organized pursuant to the Act, (ii) enter into any partnership,
joint venture or other similar arrangement to engage in any business described
in the foregoing clause (i) or to own interests in any entity engaged, directly
or indirectly, in any such business and (iii) do anything necessary or
incidental to the foregoing, provided, however, that such business shall be
limited to and conducted in such a manner as to permit the General Partner at
all times to be classified as a REIT for federal income tax purposes, unless the
General Partner ceases to qualify as a REIT for reasons other than the conduct
of the business of the Partnership. In connection with the foregoing, and
without limiting the General Partner's right in its sole discretion to cease
qualifying as a REIT, the Limited Partners acknowledge that the General
Partner's current status as a REIT inures to the benefit of all the Limited
Partners and not solely the General Partner.

SECTION 3.2 POWERS

     The Partnership is empowered to do any and all acts and things necessary,
appropriate, proper, advisable, incidental to or convenient for the furtherance
and accomplishment of the purposes and business


                                      -14-



described herein and for the protection and benefit of the Partnership,
including, without limitation, full power and authority, directly or through its
ownership interest in other entities, to enter into, perform and carry out
contracts of any kind, borrow money and issue evidences of indebtedness, whether
or not secured by mortgage, deed of trust, pledge or other lien, grant
guarantees and/or indemnities, acquire, own, manage, improve and develop real
property, and lease, sell, transfer and dispose of real property; provided,
however, notwithstanding anything to the contrary in this Agreement, the
Partnership shall not take, or refrain from taking, any action which, in the
judgment of the General Partner, in its sole and absolute discretion, (i) could
adversely affect the ability of the General Partner to continue to qualify as a
REIT, (ii) absent the consent of the General Partner, which may be given or
withheld in its sole and absolute discretion, could subject the General Partner
to any taxes under Section 857 or Section 4981 of the Code, or (iii) could
violate any law or regulation of any governmental body or agency having
jurisdiction over the General Partner or its securities, unless any such action
(or inaction) under the foregoing clauses (i), (ii) or (iii) shall have been
specifically consented to by the General Partner in writing.

SECTION 3.3 PARTNERSHIP ONLY FOR PURPOSES SPECIFIED

     The Partnership shall be a partnership only for the purposes specified in
Section 3.1, and this Agreement shall not be deemed to create a partnership
among the Partners with respect to any activities whatsoever other than the
activities within the purposes of the Partnership as specified in Section 3.1.
Except as otherwise provided in this Agreement, no Partner shall have any
authority to act for, bind, commit or assume any obligation or responsibility on
behalf of the Partnership, its properties or any other Partner. No Partner, in
its capacity as a Partner under this Agreement, shall be responsible or liable
for any indebtedness or obligation of another Partner, nor shall the Partnership
be responsible or liable for any indebtedness or obligation of any Partner,
incurred either before or after the execution and delivery of this Agreement by
such Partner, except as to those responsibilities, liabilities, indebtedness or
obligations incurred pursuant to and as limited by the terms of this Agreement
and the Act.

SECTION 3.4 REPRESENTATIONS AND WARRANTIES BY THE PARTIES

     A. Each Partner that is an individual represents and warrants to each other
Partner that (i) such Partner has the legal capacity to enter into this
Agreement and perform such Partner's obligations hereunder, (ii) the
consummation of the transactions contemplated by this Agreement to be performed
by such Partner will not result in a breach or violation of, or a default under,
any agreement by which such Partner or any of such Partner's property is or are
bound, or any statute, regulation, order or other law to which such Partner is
subject, (iii) such Partner is a "United States person" within the meaning of
Section 7701(a)(30) of the Code, and (iv) this Agreement is binding upon, and
enforceable against, such Partner in accordance with its terms.

     B. Each Partner that is not an individual represents and warrants to each
other Partner that (i) its execution and delivery of this Agreement and all
transactions contemplated by this Agreement to be performed by it have been duly
authorized by all necessary action, including without limitation, that of its
general partner(s), committee(s), trustee(s), beneficiaries, directors and/or
stockholder(s), as the case may be, as required, (ii) the consummation of such
transactions shall not result in a breach or violation of, or a default under,
its certificate of limited partnership, partnership agreement, trust agreement,
limited liability company operating agreement, charter or bylaws, as the case
may be, any agreement by which such Partner or any of such Partner's properties
or any of its partners, beneficiaries, trustees or stockholders, as the case may
be, is or are bound, or any statute, regulation, order or other law to which
such Partner or any of such Partner's properties or any of its partners,
trustees, beneficiaries or stockholders, as the case may be, is or are subject,
(iii) such Partner is a "United States person" within the meaning of Section
7701(a)(30) of the Code and (iv) this Agreement is binding upon, and enforceable
against, such Partner in accordance with its terms.


                                      -15-



     C. Each Partner represents, warrants, and agrees that it has acquired and
continues to hold its interest in the Partnership for its own account for
investment only and not for the purpose of, or with a view toward, the resale or
distribution of all or any part thereof, nor with a view toward selling or
otherwise distributing such interest or any part thereof at any particular time
or under any predetermined circumstances. Each Partner further represents and
warrants that it is a sophisticated investor, able and accustomed to handling
sophisticated financial matters for itself, particularly real estate
investments, and that it has a sufficiently high net worth that it does not
anticipate a need for the funds it has invested in the Partnership in what it
understands to be a highly speculative and illiquid investment. Each Partner
represents, warrants and agrees that such Partner is an "accredited investor"
(as such term is defined in Rule 501(a) of Regulation D under the Securities
Act).

     D. Each Partner acknowledges that (i) the OP Units (and any REIT Shares
that might be exchanged therefor) have not been registered under the Securities
Act and may not be transferred unless they are subsequently registered under the
Securities Act or an exemption from such registration is available (it being
understood that the Partnership has no intention of so registering the OP
Units), (ii) a restrictive legend in the form set forth in Exhibit D shall be
placed on the certificates representing the OP Units, and (iii) a notation shall
be made in the appropriate records of the Partnership indicating that the OP
Units are subject to restrictions on transfer.

     E. Each Limited Partner further represents, warrants, covenants and agrees
as follows:

          (1) Except as provided in Exhibit E, at any time such Partner actually
or Constructively Owns a 25% or greater capital interest or profits interest in
the Partnership, it does not and will not, without the prior written consent of
the General Partner, actually own or Constructively Own (a) with respect to any
Tenant that is a corporation, any stock of such Tenant, and (b) with respect to
any Tenant that is not a corporation, any interests in either the assets or net
profits of such Tenant.

          (2) Except as provided in Exhibit F, at any time such Partner actually
or Constructively Owns a 25% or greater capital interest or profits interest in
the Partnership, it does not, and agrees that it will not without the prior
written consent of the General Partner, actually own or Constructively Own, any
stock in the General Partner, other than any REIT Shares or other shares of
capital stock of the General Partner such Partner may acquire as a result of an
exchange of Tendered Units pursuant to Section 8.6, subject to the ownership
limitations set forth in the General Partner's Charter.

          (3) Upon request of the General Partner, it will disclose to the
General Partner the amount of REIT Shares or other shares of capital stock of
the General Partner that it actually owns or Constructively Owns.

          (4) It understands that if, for any reason, (a) the representations,
warranties or agreements set forth in E(1) or (2) above are violated, or (b) the
Partnership's actual or Constructive Ownership of REIT Shares or other shares of
capital stock of the General Partner violates the limitations set forth in the
Charter, then (x) some or all of the Redemption rights of the Partners may
become non-exercisable, and (y) some or all of the REIT Shares owned by the
Partners may be automatically transferred to a trust for the benefit of a
charitable beneficiary, as provided in the Charter.

          (5) Without the consent of the General Partner, which may be given or
withheld in its sole discretion, no Partner shall take any action that would
cause the Partnership at any time to have more than 100 partners (including as
partners those persons indirectly owning an interest in the Partnership through
a partnership, limited liability company, S corporation or grantor trust (such
entity, a "flow through entity"), but only if substantially all of the value of
such person's interest in the flow through entity is attributable to the flow
through entity's interest (direct or indirect) in the Partnership).

     F. The representations and warranties contained in Sections 3.4 shall
survive the execution and delivery of this Agreement by each Partner and the
dissolution and winding-up of the Partnership.


                                      -16-



     G. Each Partner hereby acknowledges that no representations as to potential
profit, cash flows, funds from operations or yield, if any, in respect of the
Partnership or the General Partner have been made by any Partner or any employee
or representative or Affiliate of any Partner, and that projections and any
other information, including, without limitation, financial and descriptive
information and documentation, which may have been in any manner submitted to
such Partner shall not constitute any representation or warranty of any kind or
nature, express or implied.

SECTION 3.5 CERTAIN ERISA MATTERS

     Each Partner acknowledges that the Partnership is intended to qualify as a
"real estate operating company" (as such term is defined in the Plan Asset
Regulation). The General Partner may structure investments in, relationships
with and conduct with respect to Investments and any other assets of the
Partnership so that the Partnership will be a "real estate operating company"
(as such term is defined in the Plan Asset Regulation).

                                   ARTICLE 4.
                              CAPITAL CONTRIBUTIONS

SECTION 4.1 CAPITAL CONTRIBUTIONS OF THE PARTNERS

     At the time of their respective execution of this Agreement, the Partners
shall make or shall have made Capital Contributions as set forth in Exhibit A to
this Agreement. The Partners shall own OP Units of the class or series and in
the amounts set forth in Exhibit A and shall have a Percentage Interest in the
Partnership as set forth in Exhibit A, which Percentage Interest shall be
adjusted in Exhibit A from time to time by the General Partner to the extent
necessary to reflect accurately exchanges, redemptions, Capital Contributions,
the issuance of additional OP Units or similar events having an effect on a
Partner's Percentage Interest. Except as required by law, as otherwise provided
in Sections 4.3, 4.4 and 10.5, or as otherwise agreed to by a Partner and the
Partnership, no Partner shall be required or permitted to make any additional
Capital Contributions or loans to the Partnership.

SECTION 4.2 LOANS BY THIRD PARTIES

     Subject to Section 4.3, the Partnership may incur Debt, or enter into other
similar credit, guarantee, financing or refinancing arrangements for any purpose
(including, without limitation, in connection with any further acquisition of
Investments) with any Person that is not the General Partner upon such terms as
the General Partner determines appropriate; provided that, the Partnership shall
not incur any Debt that is recourse to the General Partner, except to the extent
otherwise agreed to by the General Partner in its sole discretion.

SECTION 4.3 ADDITIONAL FUNDING AND CAPITAL CONTRIBUTIONS

     A. General. The General Partner may, at any time and from time to time
determine that the Partnership requires additional funds ("Additional Funds")
for the acquisition of additional Investments or for such other Partnership
purposes as the General Partner may determine. Additional Funds may be raised by
the Partnership, at the election of the General Partner, in any manner provided
in, and in accordance with, the terms of this Section 4.3. No Person shall have
any preemptive, preferential or similar right or rights to subscribe for or
acquire any Partnership Interest, except as set forth in this Section 4.3.


                                      -17-



     B. Issuance of Additional Partnership Interests. The General Partner, in
its sole and absolute discretion, may raise all or any portion of the Additional
Funds by accepting additional Capital Contributions of cash. The General Partner
may also accept additional Capital Contributions of real property or any other
non-cash assets. In connection with any such additional Capital Contributions
(of cash or property), the General Partner is hereby authorized to cause the
Partnership from time to time to issue to Partners (including the General
Partner) or other Persons (including, without limitation, in connection with the
contribution of property to the Partnership) additional OP Units or other
Partnership Interests in one or more classes, or one or more series of any of
such classes, with such designations, preferences and relative, participating,
optional or other special rights, powers, and duties, including rights, powers,
and duties senior to then existing Limited Partner Interests, all as shall be
determined by the General Partner in its sole and absolute discretion subject to
Delaware law, and as set forth by amendment to this Agreement, including without
limitation, (i) the allocations of items of Partnership income, gain, loss,
deduction, and credit to such class or series of Partnership Interests; (ii) the
right of each such class or series of Partnership Interests to share in
Partnership distributions; (iii) the rights of each such class or series of
Partnership Interests upon dissolution and liquidation of the Partnership; and
(iv) the right to vote, including, without limitation, the Limited Partner
approval rights set forth in Section 11.2.A; provided, that no such additional
OP Units or other Partnership Interests shall be issued to the General Partner
unless either (a) (1) the additional Partnership Interests are issued in
connection with the grant, award, or issuance of shares of the General Partner
pursuant to Section 4.3.C below, which shares have designations, preferences,
and other rights (except voting rights) such that the economic interests
attributable to such shares are substantially similar to the designations,
preferences and other rights of the additional Partnership Interests issued to
the General Partner in accordance with this Section 4.3.B, and (2) the General
Partner shall make a Capital Contribution to the Partnership in an amount equal
to the net proceeds raised in connection with such issuance, or (b) the
additional Partnership Interests are issued to all Partners holding Partnership
Interests in the same class in proportion to their respective Percentage
Interests in such class. The General Partner's determination that consideration
is adequate shall be conclusive insofar as the adequacy of consideration relates
to whether the Partnership Interests are validly issued and paid. In the event
that the Partnership issues additional Partnership Interests pursuant to this
Section 4.3.B, the General Partner shall make such revisions to this Agreement
(including but not limited to the revisions described in Section 5.4 and Section
8.6) as it determines are necessary to reflect the issuance of such additional
Partnership Interests. Without limiting the foregoing, the General Partner is
expressly authorized to cause the Partnership to issue OP Units for less than
fair market value, so long as the General Partner concludes in good faith that
such issuance of Partnership Interests is in the best interests of the
Partnership.

     C. Issuance of REIT Shares or Other Securities by the General Partner. The
General Partner shall not issue any additional REIT Shares, other shares of
capital stock of the General Partner or New Securities (other than REIT Shares
issued pursuant to Section 8.6 or such shares, stock or securities pursuant to a
dividend or distribution (including any stock split) to all of its stockholders
or all of its stockholders who hold a particular class of stock of the General
Partner) unless (i) the General Partner shall cause the Partnership to issue to
the General Partner, Partnership Interests or rights, options, warrants or
convertible or exchangeable securities of the Partnership having designations,
preferences and other rights, all such that the economic interests thereof are
substantially similar to those of the REIT Shares, other shares of capital stock
of the General Partner or New Securities issued by the General Partner and (ii)
the General Partner shall make a Capital Contribution of the net proceeds from
the issuance of such additional REIT Shares, other shares of capital stock or
New Securities, as the case may be, and from the exercise of the rights
contained in such additional New Securities, as the case may be. Without
limiting the foregoing, the General Partner is expressly authorized to issue
REIT Shares, other shares of capital stock of the General Partner or New
Securities for no tangible value or for less than fair market value, and the
General Partner is expressly authorized to cause the Partnership to issue to the
General Partner corresponding Partnership Interests, so long as (x) the General
Partner concludes in good faith that such issuance of Partnership Interests is
in the interests of the Partnership; and (y) the General Partner contributes all
proceeds, if any, from such issuance and exercise to the Partnership. In
connection with the General Partner's initial offering of REIT Shares, any other
issuance of REIT Shares, other capital stock of the General Partner or New


                                      -18-



Securities, the General Partner shall contribute to the Partnership, any net
proceeds raised in connection with such issuance; provided, that the General
Partner may use a portion of the net proceeds from any offering to acquire OP
Units or other assets (provided such other assets are contributed to the
Partnership pursuant to the terms of this Agreement; and provided further that
if the net proceeds actually received by the General Partner are less than the
gross proceeds of such issuance as a result of any underwriter's discount or
other expenses paid or incurred in connection with such issuance then, except to
the extent such net proceeds are used to acquire OP Units, the General Partner
shall be deemed to have made a Capital Contribution to the Partnership in the
amount equal to the sum of the net proceeds of such issuance plus the amount of
such underwriter's discount and other expenses paid by the General Partner
(which discount and expense shall be treated as an expense for the benefit of
the Partnership for purposes of Section 7.4)).

     D. Percentage Interest Adjustments in the Case of Capital Contributions for
OP Units. Upon the acceptance of additional Capital Contributions in exchange
for OP Units, the Percentage Interest in such OP Units shall be equal to a
fraction, the numerator of which is equal to the amount of cash and the Agreed
Value of the Property contributed as of the time such additional Capital
Contributions are made (an "Adjustment Date") and the denominator of which is
equal to the sum of (i) the Deemed Value of the Partnership Interests of such
class or series (computed as of the Business Day immediately preceding the
Adjustment Date) and (ii) the aggregate Agreed Value of additional Capital
Contributions contributed by all Partners and/or third parties to the
Partnership on such Adjustment Date in such class or series of Partnership
Interests. The Percentage Interest of each other Partner holding Partnership
Interests of such class or series not making a full pro rata Capital
Contribution shall be adjusted to equal a fraction, the numerator of which is
equal to the sum of (i) the Deemed Partnership Interest Value of such Limited
Partner in respect of such class or series (computed as of the Business Day
immediately preceding the Adjustment Date) and (ii) the Agreed Value of
additional Capital Contributions, if any, made by such Partner to the
Partnership in such class or series of Partnership Interests as of such
Adjustment Date, and the denominator of which is equal to the sum of (i) the
Deemed Value of the Partnership Interests of such class or series (computed as
of the Business Day immediately preceding the Adjustment Date), plus (ii) the
aggregate Agreed Value of additional Capital Contributions contributed by all
Partners and/or third parties to the Partnership on such Adjustment Date in such
class or series. Provided, however, solely for purposes of calculating a
Partner's Percentage Interest pursuant to this Section 4.3.D, (i) in the case of
cash Capital Contributions by the General Partner funded by an offering of REIT
Shares or other shares of capital stock of the General Partner and (ii) in the
case of the contribution of properties by the General Partner which were
acquired by the General Partner in exchange for REIT Shares or other shares of
capital stock of the General Partner immediately prior to such contribution, the
General Partner shall be issued a number of OP Units equal and corresponding to
the number of such shares issued by the General Partner in exchange for such
cash or Investments, the OP Units held by the other Partners shall not be
adjusted, and the Partners' Percentage Interests shall be adjusted accordingly.
The General Partner shall promptly give each Partner written notice of its
Percentage Interest, as adjusted.

     E. Reinvestment of Special General Partner Distributions. The Special
General Partner, in its sole and absolute discretion, may elect, on an annual
basis, to reinvest all, or any portion, of the distributions of Available Cash
and Capital Proceeds it receives under Section 5.1 in the Partnership in
exchange for the issuance of OP Units. If the Special General Partner elects to
reinvest any portion of Available Cash and Capital Proceeds distributed to the
Special General Partner under this Agreement, the Special General Partner shall
be treated no differently than any Limited Partner making a Capital Contribution
to the Partnership under Section 4.3.

SECTION 4.4 OTHER CONTRIBUTION PROVISIONS

     With the consent of the General Partner, in its sole discretion, one or
more Limited Partners may enter into agreements with the Partnership, in the
form of a guarantee or contribution agreement, which have the effect of
providing a guarantee of certain obligations of the Partnership.


                                      -19-



SECTION 4.5 NO PREEMPTIVE RIGHTS

     Except to the extent expressly granted by the Partnership pursuant to
another agreement, no Person shall have any preemptive, preferential or other
similar right with respect to (i) providing funds to the Partnership or (ii)
issuance or sale of any OP Units or other Partnership Interests.

SECTION 4.6 NO INTEREST; NO RETURN.

     No Partner shall be entitled to interest on its Capital Contribution or on
such Partner's Capital Account. Except as provided herein or by law, no Partner
shall have any right to demand or receive the return of its Capital Contribution
from the Partnership.

SECTION 4.7 PROFITS INTEREST OF SPECIAL GENERAL PARTNER

     To the extent that the Special General Partner receives a Partnership
Interest with a disproportionate interest in Partnership Net Income or Net Loss,
such Partnership Interest shall be treated as a "profits interest" received for
services rendered, or to be rendered, within the meaning of IRS Rev. Proc.
93-27, 1993-2 C.B. 343.

                                   ARTICLE 5.
                                  DISTRIBUTIONS

SECTION 5.1 REQUIREMENT AND CHARACTERIZATION OF DISTRIBUTIONS

     The General Partner shall cause the Partnership to distribute at least
quarterly all, or such portion as the General Partner may in its discretion
determine, Available Cash and Capital Proceeds generated by the Partnership to
the Partners who are Partners on the applicable Partnership Record Date with
respect to such distribution, in the following order and priority:

     A.   Available Cash.

          (1) First, Available Cash from Long-Term Net Leased Properties shall
be distributed ten percent (10%) to the Special General Partner, and ninety
percent (90%) to the Partners in proportion to their respective Percentage
Interests;

          (2) Second, Available Cash from Real Estate Related Loans shall be
distributed one hundred percent (100%) to the Special General Partner in an
amount equal to the lesser of (i) ten percent (10%) of Available Cash from Real
Estate Related Loans, or (ii) twenty percent (20%) of Available Cash from Real
Estate Related Loans in excess of five percent (5%) of Available Cash from Real
Estate Related Loans; and any remaining Available Cash from Real Estate Related
Loans shall be distributed to the Partners in proportion to their respective
Percentage Interests;

          (3) Third, Available Cash from Real Estate Securities shall be
distributed one hundred percent (100%) to the Partners in proportion to their
respective Percentage Interests; and

          (4) Fourth, Available Residual Cash shall be distributed ten percent
(10%) to the Special General Partner, and ninety percent (90%) to the Partners
in proportion to their respective Percentage Interests.

     B.   Distribution of Capital Proceeds.


                                      -20-



          (1) First, Capital Proceeds shall be distributed one hundred percent
(100%) to the General Partner until the General Partner has received
distributions under this Section 5.1.B(1) equal to the General Partner Unpaid
Priority Return;

          (2) Second, Capital Proceeds shall be distributed one hundred percent
(100%) to the General Partner until the General Partner Net Current Investment
has been reduced to zero; and

          (3) Third, any remaining Capital Proceeds shall be distributed fifteen
percent (15%) to the Special General Partner and eighty-five percent (85%) to
the Partners in proportion to their respective Percentage Interests.

Notwithstanding any other provision of this Article 5 to the contrary, the
General Partner shall take such reasonable efforts, as determined by it in its
sole and absolute discretion and consistent with its qualification as a REIT, to
cause the Partnership to distribute sufficient amounts to enable the General
Partner, for so long as the General Partner has determined to qualify as a REIT,
to pay stockholder dividends that will (a) satisfy the requirements for
qualifying as a REIT under the Code and Regulations ("REIT Requirements"), and
(b) except to the extent otherwise determined by the General Partner, avoid the
imposition of any federal income or excise tax liability on the General Partner.

SECTION 5.2 DISTRIBUTIONS IN KIND

     Except as expressly provided herein, no right is given to any Partner to
demand and receive property other than cash. The General Partner may determine,
in its sole and absolute discretion, to make a distribution in-kind to the
Partners of Partnership assets, and such assets shall be distributed in such a
fashion as to ensure that the fair market value is distributed and allocated in
accordance with Articles 5, 6 and 10.

SECTION 5.3 DISTRIBUTIONS UPON LIQUIDATION

     Notwithstanding Section 5.1, proceeds from a Liquidating Event shall be
distributed to the Partners in accordance with Section 13.2.

SECTION 5.4 DISTRIBUTIONS TO REFLECT ISSUANCE OF ADDITIONAL PARTNERSHIP
INTERESTS

     In the event that the Partnership issues additional Partnership Interests
to the General Partner, the Special General Partner, or any Additional Limited
Partner pursuant to Section 4.3.B, 4.3.C, or 4.3E, the General Partner shall
make such revisions to this Article 5 as it determines are necessary to reflect
the issuance of such additional Partnership Interests. In the absence of any
agreement to the contrary, an Additional Limited Partner shall be entitled to
the distributions set forth in Section 5.1 (without regard to this Section 5.4)
with respect to the period during which the closing of its contribution to the
Partnership occurs, multiplied by a fraction the numerator of which is the
number of days from and after the date of such closing through the end of the
applicable period, and the denominator of which is the total number of days in
such period.

SECTION 5.5 DISTRIBUTION LIMITATION

     Notwithstanding any other provision in this Article 5, the General Partner
shall have the power, in its reasonable discretion, to adjust the distributions
to the Special General Partner to the extent necessary to avoid violations of
the "2%/25% Guidelines" as described in the Advisory Agreement.


                                      -21-



                                   ARTICLE 6.
                                   ALLOCATIONS

SECTION 6.1 TIMING AND AMOUNT OF ALLOCATIONS OF NET INCOME AND NET LOSS

     Net Income and Net Loss of the Partnership shall be determined and
allocated with respect to each Partnership Year of the Partnership as of the end
of each such year. Subject to the other provisions of this Article 6, an
allocation to a Partner of a share of Net Income or Net Loss shall be treated as
an allocation of the same share of each item of income, gain, loss or deduction
that is taken into account in computing Net Income or Net Loss.

SECTION 6.2 GENERAL ALLOCATIONS

     A. Allocation of Net Income and Net Loss Other Than From a Capital
Transaction.

     (1) Net Income other than from a Capital Transaction. Except as otherwise
provided in Section 6.3, Net Income other than from a Capital Transaction for
any Partnership Year shall be allocated to the Partners in the following manner
and order of priority:

          (a) First, Net Income from Long-Term Net Leased Properties shall be
allocated ten percent (10%) to the Special General Partner, and ninety percent
(90%) to the Partners in proportion to their respective Percentage Interests;

          (b) Second, Net Income from Real Estate Related Loans shall be
allocated one hundred percent (100%) to the Special General Partner in an amount
equal to the lesser of (i) ten percent (10%) of Net Income from Real Estate
Related Loans, or (ii) twenty percent (20%) of Net Income from Real Estate
Related Loans in excess of five percent (5%) of Net Income from Real Estate
Related Loans; and any remaining Net Income from Real Estate Related Loans shall
be allocated to the Partners in proportion to their respective Percentage
Interests;

          (c) Third, Net Income from Real Estate Securities shall be allocated
one hundred percent (100%) to the Partners in proportion to their respective
Percentage Interests; and

          (d) Fourth, Net Residual Income shall be allocated ten percent (10%)
to the Special General Partner, and ninety percent (90%) to the Partners in
proportion to their respective Percentage Interests.

     (2) Net Loss other than from a Capital Transaction. Except as otherwise
provided in Section 6.3, Net Loss other than from a Capital Transaction for any
Partnership Year shall be allocated to the Partners in the following manner and
order of priority:

          (a) First, to the Partners, in proportion to their relative
allocations of Net Income other than from a Capital Transaction pursuant to
Section 6.2.A(1) until the aggregate allocations of Net Loss other than from a
Capital Transaction pursuant to this Section 6.2.A(2) for all Partnership Years
equal the aggregate allocations of Net Income other than from a Capital
Transaction pursuant to Section 6.2.A(1) for all prior Partnership Years;

          (b) Second, to the Partners in proportion to their respective Adjusted
Capital Account Balances until the Adjusted Capital Account Balance of each such
Partner is zero; and

          (c) Third, to each of the Partners in proportion to their respective
Percentage Interests.

     B. Allocation of Net Income and Net Loss From a Capital Transaction


                                      -22-



     (1) Net Income from a Capital Transaction. Except as otherwise provided in
Section 6.3, Net Income from a Capital Transaction for any Partnership Year
shall be allocated to the Partners in the following manner and order of
priority:

          (a) First, to the Partners, in proportion to their relative
allocations of Net Loss from a Capital Transaction pursuant to Section
6.2.B(2)(b) and (c) until the aggregate allocations of Net Income from a Capital
Transaction pursuant to this Section 6.2.B(1)(a) for all Partnership Years equal
the aggregate allocations of Net Loss from a Capital Transaction pursuant to
Section 6.2.B(2)(b) and (c) for all prior Partnership Years;

          (b) Second, one hundred percent (100%) to the General Partner until
the Adjusted Capital Account Balance of the General Partner equals the sum of
the General Partner Net Current Investment and the General Partner Unpaid
Priority Return; and

          (c) Third, fifteen percent (15%) to the Special General Partner, and
eighty-five percent (85%) to the Partners in proportion to their respective
Percentage Interests.

     (2) Net Loss from a Capital Transaction. Except as otherwise provided in
Section 6.3, Net Loss from a Capital Transaction for any Partnership Year shall
be allocated to the Partners in the following manner and order of priority:

          (a) First, to the Partners, in proportion to their relative
allocations of Net Income from a Capital Transaction pursuant to Section
6.2.B(1)(c) until the aggregate allocations of Net Loss from a Capital
Transaction pursuant to this Section 6.2.B(2)(a) for all Partnership Years equal
the aggregate allocations of Net Income from a Capital Transaction pursuant to
Section 6.2.B(1)(c) for all prior Partnership Years;

          (b) Second, to the Partners in proportion to their respective Adjusted
Capital Account Balances until the Adjusted Capital Account Balance of each such
Partner is zero; and

          (c) Third, to the Partners in proportion to their respective
Percentage Interests.

     C. Allocations to Reflect Issuance of Additional Partnership Interests. In
the event that the Partnership issues additional Partnership Interests to the
General Partner, the Special General Partner, a Limited Partner or any
Additional Limited Partner pursuant to Section 4.3, the General Partner shall
make such revisions to this Section 6.2 as it determines are necessary to
reflect the terms of the issuance of such additional Partnership Interests,
including making preferential allocations to certain classes of Partnership
Interests, in accordance with any method selected by the General Partner.

SECTION 6.3 REGULATORY ALLOCATIONS

     Notwithstanding the foregoing provisions of this Article 6:

          (i) Minimum Gain Chargeback. Except as otherwise provided in
Regulations Section 1.704-2(f), notwithstanding the provisions of Section 6.2,
or any other provision of this Article 6, if there is a net decrease in
Partnership Minimum Gain during any Partnership Year, each Partner shall be
specially allocated items of Partnership income and gain for such year (and, if
necessary, subsequent years) in an amount equal to such Partner's share of the
net decrease in Partnership Minimum Gain, as determined under Regulations
Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made
in proportion to the respective amounts required to be allocated to each Partner
pursuant thereto. The items to be allocated shall be determined in accordance
with Regulations Sections 1.704-2(f)(6) and 1.704-2(j)(2). This Section 6.3(i)
is intended to qualify as a "minimum gain chargeback" within the meaning of


                                      -23-



Regulation Section 1.704-2(f) which shall be controlling in the event of a
conflict between such Regulation and this Section 6.3(i).

          (ii) Partner Minimum Gain Chargeback. Except as otherwise provided in
Regulations Section 1.704-2(i)(4), and notwithstanding the provisions of Section
6.2, or any other provision of this Article 6 (except Section 6.3(i)), if there
is a net decrease in Partner Minimum Gain attributable to a Partner Nonrecourse
Debt during any Partnership Year, each Partner who has a share of the Partner
Minimum Gain attributable to such Partner Nonrecourse Debt, determined in
accordance with Regulations Section 1.704-2(i)(5), shall be specially allocated
items of Partnership income and gain for such year (and, if necessary,
subsequent years) in an amount equal to such Partner's share of the net decrease
in Partner Minimum Gain attributable to such Partner Nonrecourse Debt,
determined in accordance with Regulations Section 1.704-2(i)(4). Allocations
pursuant to the previous sentence shall be made in proportion to the respective
amounts required to be allocated to each Partner pursuant thereto. The items to
be so allocated shall be determined in accordance with Regulations Sections
1.704-2(i)(4) and 1.704-2(j)(2). This Section 6.3(ii) is intended to qualify as
a "chargeback of partner nonrecourse debt minimum gain" within the meaning of
Regulation Section 1.704-2(i) which shall be controlling in the event of a
conflict between such Regulation and this Section 6.3(ii).

          (iii) Nonrecourse Deductions and Partner Nonrecourse Deductions. Any
Nonrecourse Deductions for any Partnership Year shall be specially allocated to
the Partners in accordance with their respective Percentage Interests. Any
Partner Nonrecourse Deductions for any Partnership Year shall be specially
allocated to the Partner(s) who bears the economic risk of loss with respect to
the Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions are
attributable, in accordance with Regulations Sections 1.704-2(b)(4) and
1.704-2(i).

          (iv) Qualified Income Offset. If any Partner unexpectedly receives an
adjustment, allocation or distribution described in Regulations Section
1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of Partnership income and gain shall
be allocated, in accordance with Regulations Section 1.704-1(b)(2)(ii)(d), to
the Partner in an amount and manner sufficient to eliminate, to the extent
required by such Regulations, the Adjusted Capital Account Deficit of the
Partner as quickly as possible provided that an allocation pursuant to this
Section 6.3(iv) shall be made if and only to the extent that such Partner would
have an Adjusted Capital Account Deficit after all other allocations provided in
this Article 6 have been tentatively made as if this Section 6.3(iv) were not in
this Agreement. It is intended that this Section 6.3(iv) qualify and be
construed as a "qualified income offset" within the meaning of Regulations
1.704-1(b)(2)(ii)(d), which shall be controlling in the event of a conflict
between such Regulations and this Section 6.3(iv).

          (v) Gross Income Allocation. In the event any Partner has a deficit
Capital Account at the end of any Partnership Year which is in excess of the sum
of (1) the amount (if any) such Partner is obligated to restore to the
Partnership, and (2) the amount such Partner is deemed to be obligated to
restore pursuant to Regulations Section 1.704-1(b)(2)(ii)(c) or the penultimate
sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), each such
Partner shall be specially allocated items of Partnership income and gain in the
amount of such excess as quickly as possible, provided, that an allocation
pursuant to this Section 6.3(v) shall be made if and only to the extent that
such Partner would have a deficit Capital Account in excess of such sum after
all other allocations provided in this Article 6 have been tentatively made as
if this Section 6.3(v) and Section 6.3(iv) were not in this Agreement.

          (vi) Limitation on Allocation of Net Loss. To the extent any
allocation of Net Loss would cause or increase an Adjusted Capital Account
Deficit as to any Partner, such allocation of Net Loss shall be reallocated
among the other Partners in accordance with their respective Percentage
Interests, subject to the limitations of this Section 6.3(vi).

          (vii) Section 754 Adjustment. To the extent an adjustment to the
adjusted tax basis of any Partnership asset pursuant to Code Section 734(b) or
Code Section 743(b) is required, pursuant to


                                      -24-



Regulations Section 1.704-1(b)(2)(iv)(m)(2) or Regulations Section
1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital
Accounts as the result of a distribution to a Partner in complete liquidation of
his interest in the Partnership, the amount of such adjustment to the Capital
Accounts shall be treated as an item of gain (if the adjustment increases the
basis of the asset) or loss (if the adjustment decreases such basis) and such
gain or loss shall be specially allocated to the Partners in accordance with
their interests in the Partnership in the event that Regulations Section
1.704-1(b)(2)(iv)(m)(2) applies, or to the Partners to whom such distribution
was made in the event that Regulations Section 1.704-1(b)(2)(iv)(m)(4) applies.

          (viii) Curative Allocation. The allocations set forth in Sections
6.3(i), (ii), (iii), (iv), (v), (vi), and (vii) (the "Regulatory Allocations")
are intended to comply with certain regulatory requirements, including the
requirements of Regulations Sections 1.704-1(b) and 1.704-2. Notwithstanding the
provisions of Sections 6.1 and 6.2, the Regulatory Allocations shall be taken
into account in allocating other items of income, gain, loss and deduction among
the Partners so that, to the extent possible, the net amount of such allocations
of other items and the Regulatory Allocations to each Partner shall be equal to
the net amount that would have been allocated to each such Partner if the
Regulatory Allocations had not occurred. For purposes of determining a Partner's
proportional share of the "excess nonrecourse liabilities" of the Partnership
within the meaning of Regulations Section 1.752-3(a)(3), each Partner's interest
in Partnership profits shall be such Partner's Percentage Interest.

SECTION 6.4 TAX ALLOCATIONS

     A. In General. Except as otherwise provided in this Section 6.4, for income
tax purposes each item of income, gain, loss and deduction (collectively, "Tax
Items") shall be allocated among the Partners in the same manner as its
correlative item of "book" income, gain, loss or deduction is allocated pursuant
to Sections 6.2 and 6.3.

     B. Allocations Respecting Section 704(c) Revaluations. Notwithstanding
Section 6.4.A, Tax Items with respect to Partnership property that is
contributed to the Partnership by a Partner with a Gross Asset Value that
differs from its adjusted tax basis in the hands of the Contributing Partner
immediately preceding the date of contribution shall be allocated among the
Partners for income tax purposes pursuant to Regulations promulgated under
Section 704(c) of the Code, so as to take into account the variation between
book Capital Accounts and tax capital accounts. The Partnership shall account
for such variation under the "traditional method" under Regulations Section
1.704-3(b) with respect to Partnership property that is contributed to the
Partnership in connection with the General Partner's initial offering. With
respect to other properties contributed to the Partnership, the Partnership
shall account for such variation under any reasonable method consistent with
Section 704(c) of the Code and the applicable regulations as chosen by the
General Partner. In the event the Gross Asset Value of any Partnership asset is
adjusted pursuant to subparagraph (b) of the definition of Gross Asset Value
(provided in Article 1), subsequent allocations of Tax Items with respect to
such asset shall take account of the variation, if any, between the adjusted
basis of such asset and its Gross Asset Value in the same manner as under
Section 704(c) of the Code and the applicable regulations consistent with the
requirements of Regulations Section 1.704-1(b)(2)(iv)(g) using any method
approved under Section 704(c) of the Code and the applicable regulations as
chosen by the General Partner.

                                   ARTICLE 7.
                      MANAGEMENT AND OPERATIONS OF BUSINESS

SECTION 7.1 MANAGEMENT

     A. Except as otherwise expressly provided in this Agreement, all management
powers over the business and affairs of the Partnership are and shall be
exclusively vested in the General Partner, and no Limited Partner shall have any
right to participate in or exercise control or management power over the
business


                                      -25-



and affairs of the Partnership. The General Partner may not be removed
by the Limited Partners with or without cause, except with the consent of the
General Partner. In addition to the powers now or hereafter granted a general
partner of a limited partnership under applicable law or which are granted to
the General Partner under any other provision of this Agreement, the General
Partner, subject to the other provisions hereof including Sections 7.3 and 11.2,
shall have full power and authority to do all things deemed necessary or
desirable by it to conduct the business of the Partnership (including, without
limitation, all actions consistent with allowing the General Partner at all
times to qualify as a REIT unless the General Partner voluntarily terminates its
REIT status), to exercise all powers set forth in Section 3.2 and to effectuate
the purposes set forth in Section 3.1, including, without limitation:

          (1) the making of any expenditures, the lending or borrowing of money
(including, without limitation, making prepayments on loans and borrowing money
to permit the Partnership to make distributions to its Partners in such amounts
as will permit the General Partner (so long as the General Partner has
determined to qualify as a REIT) to avoid the payment of any federal income tax
(including, for this purpose, any excise tax pursuant to Section 4981 of the
Code) and to make distributions to its stockholders sufficient to permit the
General Partner to maintain REIT status), the assumption or guarantee of, or
other contracting for, indebtedness and other liabilities, the issuance of
evidences of indebtedness (including the securing of same by mortgage, deed of
trust or other lien or encumbrance on all or any of the Partnership's assets)
and the incurring of any obligations it deems necessary for the conduct of the
activities of the Partnership;

          (2) the making of tax, regulatory and other filings, or rendering of
periodic or other reports to governmental or other agencies having jurisdiction
over the business or assets of the Partnership, the registration of any class of
securities of the Partnership under the Exchange Act, and the listing of any
debt securities of the Partnership on any exchange;

          (3) subject to the provisions of Section 11.2, the acquisition,
disposition, mortgage, pledge, encumbrance, hypothecation or exchange of any
assets of the Partnership or the merger or other combination of the Partnership
with or into another entity;

          (4) the acquisition, disposition, mortgage, pledge, encumbrance or
hypothecation of all or any assets of the Partnership, and the use of the assets
of the Partnership (including, without limitation, cash on hand) for any purpose
consistent with the terms of this Agreement and on any terms it sees fit,
including, without limitation, the financing of the conduct or the operations of
the General Partner or the Partnership, the lending of funds to other Persons
(including, without limitation, the General Partner or any Subsidiaries of the
Partnership) and the repayment of obligations of the Partnership, any of its
Subsidiaries and any other Person in which it has an equity investment, and the
making of capital contributions to its Subsidiaries;

          (5) the management, operation, leasing, landscaping, repair,
alteration, demolition or improvement of any real property or improvements owned
by the Partnership or any Subsidiary of the Partnership;

          (6) the negotiation, execution, and performance of any contracts,
leases, conveyances or other instruments that the General Partner considers
useful or necessary to the conduct of the Partnership's operations or the
implementation of the General Partner's powers under this Agreement, including
contracting with contractors, developers, consultants, accountants, legal
counsel, other professional advisors and other agents and the payment of their
expenses and compensation out of the Partnership's assets;

          (7) the distribution of Partnership cash or other Partnership assets
in accordance with this Agreement;

          (8) the establishment of one or more divisions of the Partnership, the
selection and dismissal of employees of the Partnership (including, without
limitation, employees having titles such as "president," "vice president,"
"secretary" and "treasurer"), and agents, outside attorneys, accountants,
consultants and


                                      -26-



contractors of the Partnership, the determination of their compensation and
other terms of employment or hiring, including waivers of conflicts of interest
and the payment of their expenses and compensation out of the Partnership's
assets;

          (9) the maintenance of such insurance for the benefit of the
Partnership and the Partners and directors and officers of the Partnership or
the General Partner as it deems necessary or appropriate;

          (10) the formation of, or acquisition of an interest in, and the
contribution of property to, any further limited or general partnerships,
limited liability companies, joint ventures, corporations or other relationships
that it deems desirable (including, without limitation, the acquisition of
interests in, and the contributions of property to any Subsidiary and any other
Person in which it has an equity investment from time to time); provided, that,
as long as the General Partner has determined to continue to qualify as a REIT,
the Partnership may not engage in any such formation, acquisition or
contribution that could cause the General Partner to fail to qualify as a REIT;

          (11) the control of any matters affecting the rights and obligations
of the Partnership, including the settlement, compromise, submission to
arbitration or any other form of dispute resolution, or abandonment of, any
claim, cause of action, liability, debt or damages, due or owing to or from the
Partnership, the commencement or defense of suits, legal proceedings,
administrative proceedings, arbitration or other forms of dispute resolution,
and the representation of the Partnership in all suits or legal proceedings,
administrative proceedings, arbitrations or other forms of dispute resolution,
the incurring of legal expense, and the indemnification of any Person against
liabilities and contingencies to the extent permitted by law;

          (12) the undertaking of any action in connection with the
Partnership's direct or indirect investment in any Person (including, without
limitation, contributing or loaning Partnership funds to, incurring indebtedness
on behalf of, or guarantying the obligations of any such Persons);

          (13) subject to the other provisions in this Agreement, the
determination of the fair market value of any Partnership property distributed
in kind using such reasonable method of valuation as it may adopt, provided,
that such methods are otherwise consistent with requirements of this Agreement;

          (14) the management, operation, leasing, landscaping, repair,
alteration, demolition or improvement of any real property or improvements owned
by the Partnership or any Subsidiary of the Partnership or any Person in which
the Partnership has made a direct or indirect equity investment;

          (15) holding, managing, investing and reinvesting cash and other
assets of the Partnership;

          (16) the collection and receipt of revenues and income of the
Partnership;

          (17) the exercise, directly or indirectly through any attorney-in-fact
acting under a general or limited power of attorney, of any right, including the
right to vote, appurtenant to any asset or investment held by the Partnership;

          (18) the exercise of any of the powers of the General Partner
enumerated in this Agreement on behalf of or in connection with any Subsidiary
of the Partnership or any other Person in which the Partnership has a direct or
indirect interest, or jointly with any such Subsidiary or other Person;

          (19) the exercise of any of the powers of the General Partner
enumerated in this Agreement on behalf of any Person in which the Partnership
does not have an interest pursuant to contractual or other arrangements with
such Person;

          (20) the making, execution and delivery of any and all deeds, leases,
notes, deeds to secure debt, mortgages, deeds of trust, security agreements,
conveyances, contracts, guarantees, warranties, indemnities,


                                      -27-



waivers, releases or legal instruments or agreements in writing necessary or
appropriate in the judgment of the General Partner for the accomplishment of any
of the powers of the General Partner enumerated in this Agreement;

          (21) the issuance of additional Partnership Interests, as appropriate,
in connection with the contribution of Additional Funds pursuant to Section 4.3;

          (22) the distribution of cash to acquire OP Units held by a Limited
Partner in connection with a Limited Partner's exercise of its Redemption Right
under Section 8.6 hereof;

          (23) the amendment and restatement of Exhibit A hereto to reflect
accurately at all times the Capital Contributions and Percentage Interests of
the Partners as the same are adjusted from time to time to the extent necessary
to reflect redemptions, Capital Contributions, the issuance of OP Units, the
admission of any Additional Limited Partner or any Substituted Limited Partner
or otherwise, which amendment and restatement, notwithstanding anything in this
Agreement to the contrary, shall not be deemed an amendment to this Agreement,
as long as the matter or event being reflected in Exhibit A hereto otherwise is
authorized by this Agreement;

          (24) the taking of any and all acts and things necessary or prudent to
ensure that the Partnership will not be classified as a "publicly traded
partnership" under Section 7704 of the Code; and

          (25) the delegation to another Person of any powers now or hereafter
granted to the General Partner.

     B. Each of the Limited Partners agrees that the General Partner is
authorized to execute, deliver and perform the above-mentioned agreements and
transactions on behalf of the Partnership without any further act, approval or
vote of the Partners, notwithstanding any other provisions of this Agreement
(except as provided in Section 7.3 or 11.2), the Act or any applicable law, rule
or regulation to the fullest extent permitted under the Act or other applicable
law, rule or regulation. The execution, delivery or performance by the General
Partner or the Partnership of any agreement authorized or permitted under this
Agreement shall not constitute a breach by the General Partner of any duty that
the General Partner may owe the Partnership or the Limited Partners or any other
Persons under this Agreement or of any duty stated or implied by law or equity.

     C. At all times from and after the date hereof, the General Partner may
cause the Partnership to obtain and maintain (i) casualty, liability and other
insurance on the Investments and (ii) liability insurance for the Indemnities
hereunder.

     D. At all times from and after the date hereof, the General Partner may
cause the Partnership to establish and maintain working capital and other
reserves in such amounts as the General Partner, in its sole and absolute
discretion, deems appropriate and reasonable from time to time.

     E. Each of the Limited Partners acknowledges that, in exercising its
authority under this Agreement, the General Partner may, but shall be under no
obligation to, take into account the tax consequences to any Partner (including
the General Partner) of any action taken (or not taken) by the General Partner.
The General Partner and the Partnership shall not have liability to a Partner
under this Agreement as a result of any income tax liability incurred by a
Limited Partner as a result of an action (or inaction) by the General Partner
pursuant to its authority under this Agreement.

     F. Except as otherwise provided herein, to the extent the duties of the
General Partner require expenditures of funds to be paid to third parties, the
General Partner shall not have any obligations hereunder except to the extent
that Partnership funds are reasonably available to it for the performance of
such duties, and nothing herein contained shall be deemed to authorize or
require the General Partner, in its


                                      -28-



capacity as such, to expend its individual funds for payment to third parties or
to undertake any individual liability or obligation on behalf of the
Partnership.

SECTION 7.2 CERTIFICATE OF LIMITED PARTNERSHIP

     To the extent that such action is determined by the General Partner to be
reasonable and necessary or appropriate, the General Partner shall file
amendments to and restatements of the Certificate and do all the things to
maintain the Partnership as a limited partnership (or a partnership in which the
limited partners have limited liability) under the laws of the State of Delaware
and to maintain the Partnership's qualification to do business as a foreign
limited partnership in each other state, the District of Columbia or other
jurisdiction, in which the Partnership may elect to do business or own property.
Subject to the terms of Section 8.5.A(4), the General Partner shall not be
required, before or after filing, to deliver or mail a copy of the Certificate
or any amendment thereto to any Limited Partner. The General Partner shall use
all reasonable efforts to cause to be filed such other certificates or documents
as may be reasonable and necessary or appropriate for the formation,
continuation, qualification and operation of a limited partnership (or a
partnership in which the limited partners have limited liability) in the State
of Delaware, any other state, or the District of Columbia or other jurisdiction,
in which the Partnership may elect to do business or own property.

SECTION 7.3 RESTRICTIONS ON GENERAL PARTNER'S AUTHORITY

     A. The General Partner may not take any action in contravention of an
express prohibition or limitation of this Agreement without the written Consent
of the Limited Partners and the Special General Partner, and may not (i) perform
any act that would subject a Limited Partner to liability as a general partner
in any jurisdiction or any other liability except as provided herein or under
the Act; or (ii) enter into any contract, mortgage, loan or other agreement that
prohibits or restricts, or has the effect of prohibiting or restricting, the
ability of a Limited Partner to exercise its rights to a Redemption in full,
except in each case with the written consent of such Limited Partner.

     B. The General Partner shall not, without the prior Consent of the Partners
(in addition to any Consent of the Limited Partners required by any other
provision hereof), or except as provided in Section 7.3.D, amend, modify or
terminate this Agreement.

     C. The General Partner may not cause the Partnership to take any action
which the General Partner would be prohibited from taking directly under the
General Partner's bylaws as in effect from time to time.

     D. Notwithstanding Section 7.3.B, the General Partner shall have the
exclusive power to amend this Agreement as may be required to facilitate or
implement any of the following purposes:

          (1) to add to the obligations of the General Partner or surrender any
right or power granted to the General Partner or any Affiliate of the General
Partner for the benefit of the Limited Partners;

          (2) to reflect the issuance of additional Partnership Interests
pursuant to Sections 4.3.B, 5.4 and 6.2B. or the admission, substitution,
termination, or withdrawal of Partners in accordance with this Agreement (which
may be effected through the replacement of Exhibit A with an amended Exhibit A);

          (3) to set forth or amend the designations, rights, powers, duties and
preferences of the holders of any additional Partnership Interests issued
pursuant to Article 4;

          (4) to reflect a change that is of an inconsequential nature and does
not adversely affect the Limited Partners in any material respect, or to cure
any ambiguity, correct or supplement any provision in this Agreement not
inconsistent with law or with other provisions, or make other changes with
respect to


                                      -29-



matters arising under this Agreement that will not be inconsistent with law or
with the provisions of this Agreement;

          (5) to satisfy any requirements, conditions, or guidelines contained
in any order, directive, opinion, ruling or regulation of a federal or state
agency or contained in federal or state law;

          (6) to reflect such changes as are reasonably necessary for the
General Partner to maintain its status as a REIT, including changes which may be
necessitated due to a change in applicable law (or an authoritative
interpretation thereof) or a ruling of the IRS;

          (7) to modify, as set forth in the definition of "Capital Account,"
the manner in which Capital Accounts are computed; and

          (8) to amend or modify any provision of this Agreement to reflect a
statutory or regulatory change regarding the federal income tax treatment of the
"profits interest" of the Special General Partner or to ensure that the receipt
of the Special General Partner's profits interest will not result in taxation to
the Special General Partner.

          The General Partner will provide notice to the Limited Partners when
any action under this Section 7.3.D is taken.

     E. Notwithstanding Sections 7.3.B and 7.3.D, this Agreement shall not be
amended with respect to any Partner adversely affected, and no action may be
taken by the General Partner, without the Consent of such Partner adversely
affected if such amendment or action would (i) convert a Limited Partner's
interest in the Partnership into a general partner's interest (except as the
result of the General Partner acquiring such interest), (ii) modify the limited
liability of a Limited Partner, (iii) alter rights of the Partner to receive
distributions pursuant to Article 5 or Section 13.2.A(4), or the allocations
specified in Article 6 (except as permitted pursuant to Sections 4.3, 5.4, 6.2.B
and Section 7.3.D(3)), (iv) materially alter or modify the rights to a
Redemption or the REIT Shares Amount as set forth in Section 8.6, and related
definitions hereof, or (v) amend this Section 7.3.E. Further, no amendment may
alter the restrictions on the General Partner's authority set forth elsewhere in
this Section 7.3 or in Section 11.2.A without the Consent specified in such
section. This Section 7.3.E does not require unanimous consent of all Partners
adversely affected unless the amendment is to be effective against all partners
adversely affected.

SECTION 7.4 REIMBURSEMENT OF THE GENERAL PARTNER

     A. Except as provided in this Section 7.4 and elsewhere in this Agreement
(including the provisions of Articles 5 and 6 regarding distributions, payments
and allocations to which it may be entitled), the General Partner shall not be
compensated for its services as general partner of the Partnership.

     B. The Partnership shall be responsible for and shall pay all expenses
relating to the Partnership's and the General Partner's organization, the
ownership of its assets and its operations. The General Partner is hereby
authorized to pay compensation for accounting, administrative, legal, technical,
management and other services rendered to the Partnership. Except to the extent
provided in this Agreement, the General Partner and its Affiliates shall be
reimbursed on a monthly basis, or such other basis as the General Partner may
determine in its sole and absolute discretion, for all expenses that the General
Partner and its Affiliates incur relating to the ownership and operation of, or
for the benefit of, the Partnership (including, without limitation,
administrative expenses); provided, that the amount of any such reimbursement
shall be reduced by any interest earned by the General Partner with respect to
bank accounts or other instruments or accounts held by it on behalf of the
Partnership. The Partners acknowledge that all such expenses of the General
Partner are deemed to be for the benefit of the Partnership. Such reimbursement
shall be in addition to any reimbursement made as a result of indemnification
pursuant to Section 7.7 hereof. In the event that certain expenses are incurred
for the benefit of the Partnership and other entities (including the


                                      -30-



General Partner), such expenses will be allocated to the Partnership and such
other entities in such a manner as the General Partner in its sole and absolute
discretion deems fair and reasonable. All payments and reimbursements hereunder
shall be characterized for federal income tax purposes as expenses of the
Partnership incurred on its behalf, and not as expenses of the General Partner.

     C. If the General Partner shall elect to purchase from its stockholders
REIT Shares for the purpose of delivering such REIT Shares to satisfy an
obligation under any dividend reinvestment program adopted by the General
Partner, any employee stock purchase plan adopted by the General Partner, or any
similar obligation or arrangement undertaken by the General Partner in the
future or for the purpose of retiring such REIT Shares, the purchase price paid
by the General Partner for such REIT Shares and any other expenses incurred by
the General Partner in connection with such purchase shall be considered
expenses of the Partnership and shall be advanced to the General Partner or
reimbursed to the General Partner, subject to the condition that: (i) if such
REIT Shares subsequently are sold by the General Partner, the General Partner
shall pay to the Partnership any proceeds received by the General Partner for
such REIT Shares (which sales proceeds shall include the amount of dividends
reinvested under any dividend reinvestment or similar program; provided, that a
transfer of REIT Shares for OP Units pursuant to Section 8.6 would not be
considered a sale for such purposes); and (ii) if such REIT Shares are not
retransferred by the General Partner within thirty (30) days after the purchase
thereof, or the General Partner otherwise determines not to retransfer such REIT
Shares, the General Partner, shall cause the Partnership to redeem a number of
OP Units held by the General Partner equal to the number of such REIT Shares, as
adjusted (x) pursuant to Section 7.5 (in the event the General Partner acquires
material assets, other than on behalf of the Partnership) and (y) for stock
dividends and distributions, stock splits and subdivisions, reverse stock splits
and combinations, distributions of rights, warrants or options, and
distributions of evidences of indebtedness or assets relating to assets not
received by the General Partner pursuant to a pro rata distribution by the
Partnership (in which case such advancement or reimbursement of expenses shall
be treated as having been made as a distribution in redemption of such number of
OP Units held by the General Partner).

     D. As set forth in Section 4.3, the General Partner shall be treated as
having made a Capital Contribution in the amount of all expenses that it incurs
relating to the General Partner's offering of REIT Shares, other shares of
capital stock of the General Partner or New Securities.

     E. If and to the extent any reimbursements to the General Partner pursuant
to this Section 7.4 constitute gross income of the General Partner (as opposed
to the repayment of advances made by the General Partner on behalf of the
Partnership), such amounts shall constitute guaranteed payments within the
meaning of Section 707(c) of the Code, shall be treated consistently therewith
by the Partnership and all Partners, and shall not be treated as distributions
for purposes of computing the Partners' Capital Accounts.

SECTION 7.5 OUTSIDE ACTIVITIES OF THE GENERAL PARTNER

     A. Except in connection with a transaction authorized in Section 11.2,
without the Consent of the Limited Partners, the General Partner shall not,
directly or indirectly, enter into or conduct any business, other than in
connection with the ownership, acquisition and disposition of Partnership
Interests as a General Partner and the management of the business of the
Partnership, its operation as a public reporting company with a class (or
classes) of securities registered under the Exchange Act, its operation as a
REIT and such activities as are incidental to the same. Without the Consent of
the Limited Partners, the General Partner shall not, directly or indirectly,
participate in or otherwise acquire any interest in any real or personal
property, except its General Partner Interest, its minority interest in any
Subsidiary Partnership(s) that the General Partner holds in order to maintain
such Subsidiary Partnership's status as a partnership, and such bank accounts,
similar instruments or other short term investments as it deems necessary to
carry out its responsibilities contemplated under this Agreement and the
Charter. In the event the General Partner desires to contribute cash to any
Subsidiary Partnership to acquire or maintain an interest of 1% or less in the
capital of such partnership, the General Partner may acquire or maintain an
interest of 1% or less in the


                                      -31-



capital of such partnership, and the General Partner may acquire such cash from
the Partnership as a loan or in exchange for a reduction in the General
Partner's OP Units, in an amount equal to the amount of such cash divided by the
Fair Market Value of a REIT Share on the day such cash is received by the
General Partner. Notwithstanding the foregoing, the General Partner may acquire
Investments or other assets in exchange for REIT Shares or cash, to the extent
such Investments or other assets are immediately contributed by the General
Partner to the Partnership, pursuant to the terms described in Section 4.3.D.
Any Limited Partner Interests acquired by the General Partner, whether pursuant
to exercise by a Limited Partner of its right of Redemption, or otherwise, shall
be automatically converted into a General Partner Interest comprised of an
identical number of OP Units with the same rights, priorities and preferences as
the class or series so acquired. The General Partner may also own one hundred
percent (100%) of the stock or interests of one or more Qualified REIT
Subsidiaries or limited liability companies, respectively, provided that any
such entity shall be subject to the limitations of this Section 7.5.A. If, at
any time, the General Partner acquires material assets (other than Partnership
Interests or other assets on behalf of the Partnership) the definition of "REIT
Shares Amount" and the definition of "Deemed Value of Partnership Interests"
shall be adjusted, as reasonably determined by the General Partner, to reflect
the relative Fair Market Value of a share of capital stock of the General
Partner relative to the Deemed Partnership Interest Value of the related
Partnership Unit. The General Partner's General Partner Interest in the
Partnership, its minority interest in any Subsidiary Partnership(s) (held
directly or indirectly through a Qualified REIT Subsidiary) that the General
Partner holds in order to maintain such Subsidiary Partnership's status as a
partnership, and interests in such short-term liquid investments, bank accounts
or similar instruments as the General Partner deems necessary to carry out its
responsibilities contemplated under this Agreement and the Charter are interests
which the General Partner is permitted to acquire and hold for purposes of this
Section 7.5.A.

     B. In the event the General Partner exercises its rights under the Charter
to purchase REIT Shares, other common stock of the General Partner or New
Securities, as the case may be, then the General Partner shall cause the
Partnership to purchase from it a number of OP Units equal to the number of REIT
Shares, other capital stock of the General Partner or New Securities, as the
case may be, so purchased on the same terms that the General Partner purchased
such REIT Shares, other capital stock of the General Partner or New Securities,
as the case may be.

SECTION 7.6 CONTRACTS WITH AFFILIATES

     A. The Partnership may lend or contribute to Persons in which it has an
equity investment, and such Persons may borrow funds from the Partnership, on
terms and conditions established in the sole and absolute discretion of the
General Partner. The foregoing authority shall not create any right or benefit
in favor of any Person.

     B. Except as provided in Section 7.5.A, the Partnership may transfer assets
to joint ventures, other partnerships, corporations or other business entities
in which it is or thereby becomes a participant upon such terms and subject to
such conditions consistent with this Agreement and applicable law as the General
Partner in its sole discretion deems advisable.

     C. The General Partner, in its sole and absolute discretion and without the
approval of the Limited Partners, may propose and adopt on behalf of the
Partnership employee benefit plans funded by the Partnership for the benefit of
employees of the General Partner, the Partnership, Subsidiaries of the
Partnership or any Affiliate of any of them in respect of services performed,
directly or indirectly, for the benefit of the Partnership, the General Partner,
or any of the Partnership's Subsidiaries.

     D. Except as expressly permitted by this Agreement, neither the General
Partner nor any of its Affiliates shall sell, transfer or convey any property
to, or purchase any property from, the Partnership, directly or indirectly,
except pursuant to transactions that are determined by the General Partner in
good faith to be fair and reasonable.


                                      -32-



     E. The General Partner is expressly authorized to enter into, in the name
and on behalf of the Partnership, a right of first opportunity arrangement and
other conflict avoidance agreements with various Affiliates of the Partnership
and the General Partner, on such terms as the General Partner, in its sole and
absolute discretion, believes are advisable.

SECTION 7.7 INDEMNIFICATION

     A. To the fullest extent permitted by law, the Partnership shall indemnify
an Indemnitee from and against any and all losses, claims, damages, liabilities,
joint or several, expenses (including legal fees and expenses), judgments,
fines, settlements, and other amounts arising from any and all claims, demands,
actions, suits or proceedings, civil, criminal, administrative or investigative,
that relate to the operations of the Partnership as set forth in this Agreement
in which any Indemnitee may be involved, or is threatened to be involved, as a
party or otherwise, unless (1) Section 12.2.2 of the Charter of the General
Partner prohibits the corporation from indemnifying the Indemnitee for a tax
matter, in which case the Partnership shall likewise be prohibited from
indemnifying the Indemnitee for the matter, or (2) it is established that: (i)
the act or omission of the Indemnitee was material to the matter giving rise to
the proceeding and either was committed in bad faith, fraud or was the result of
active and deliberate dishonesty; (ii) the Indemnitee actually received an
improper personal benefit in money, property or services; or (iii) in the case
of any criminal proceeding, the Indemnitee had reasonable cause to believe that
the act or omission was unlawful. Without limitation, the foregoing indemnity
shall extend to any liability of any Indemnitee, pursuant to a loan guaranty or
otherwise, for any indebtedness of the Partnership or any Subsidiary of the
Partnership (including, without limitation, any indebtedness which the
Partnership or any Subsidiary of the Partnership has assumed or taken subject
to), and the General Partner is hereby authorized and empowered, on behalf of
the Partnership, to enter into one or more indemnity agreements consistent with
the provisions of this Section 7.7 in favor of any Indemnitee having or
potentially having liability for any such indebtedness. The termination of any
proceeding by judgment, order, settlement, conviction or upon a plea of nolo
contendere or its equivalent, or any entry of an order of probation prior to
judgment, does not create a presumption that the Indemnitee did not meet the
requisite standard of conduct set forth in this Section 7.7.A. Any
indemnification pursuant to this Section 7.7 shall be made only out of the
assets of the Partnership, and any insurance proceeds from the liability policy
covering the General Partner and any Indemnitee, and neither the General Partner
nor any Limited Partner shall have any obligation to contribute to the capital
of the Partnership or otherwise provide funds to enable the Partnership to fund
its obligations under this Section 7.7, except to the extent otherwise expressly
agreed to by such Partner and the Partnership.

     B. Reasonable expenses incurred by an Indemnitee who is a party to a
proceeding may be paid or reimbursed by the Partnership in advance of the final
disposition of the proceeding upon receipt by the Partnership of (i) a written
affirmation by the Indemnitee of the Indemnitee's good faith belief that the
standard of conduct necessary for indemnification by the Partnership as
authorized in this Section 7.7 has been met, and (ii) a written undertaking by
or on behalf of the Indemnitee to repay the amount if it shall ultimately be
determined that the standard of conduct has not been met.

     C. The indemnification provided by this Section 7.7 shall be in addition to
any other rights to which an Indemnitee or any other Person may be entitled
under any agreement, pursuant to any vote of the Partners, as a matter of law or
otherwise, and shall continue as to an Indemnitee who has ceased to serve in
such capacity unless otherwise provided in a written agreement pursuant to which
such Indemnitee is indemnified.

     D. The Partnership may, but shall not be obligated to, purchase and
maintain insurance, on behalf of the Indemnitees and such other Persons as the
General Partner shall determine, against any liability that may be asserted
against or expenses that may be incurred by such Person in connection with the
Partnership's activities, regardless of whether the Partnership would have the
power to indemnify such Person against such liability under the provisions of
this Agreement.


                                      -33-



     E. For purposes of this Section 7.7, the Partnership shall be deemed to
have requested an Indemnitee to serve as fiduciary of an employee benefit plan
whenever the performance by it of its duties to the Partnership also imposes
duties on, or otherwise involves services by, it to the plan or participants or
beneficiaries of the plan; excise taxes assessed on an Indemnitee with respect
to an employee benefit plan pursuant to applicable law shall constitute fines
within the meaning of Section 7.7; and actions taken or omitted by the
Indemnitee with respect to an employee benefit plan in the performance of its
duties for a purpose reasonably believed by it to be in the interest of the
participants and beneficiaries of the plan shall be deemed to be for a purpose
which is not opposed to the best interests of the Partnership.

     F. In no event may an Indemnitee subject the Limited Partners to personal
liability by reason of the indemnification provisions set forth in this
Agreement.

     G. An Indemnitee shall not be denied indemnification in whole or in part
under this Section 7.7 because the Indemnitee had an interest in the transaction
with respect to which the indemnification applies if the transaction was
otherwise permitted by the terms of this Agreement.

     H. The provisions of this Section 7.7 are for the benefit of the
Indemnitees, their heirs, successors, assigns and administrators and shall not
be deemed to create any rights for the benefit of any other Persons. Any
amendment, modification or repeal of this Section 7.7 or any provision hereof
shall be prospective only and shall not in any way affect the limitations on the
Partnership's liability to any Indemnitee under this Section 7.7 as in effect
immediately prior to such amendment, modification or repeal with respect to
claims arising from or relating to matters occurring, in whole or in part, prior
to such amendment, modification or repeal, regardless of when such claims may
arise or be asserted.

     I. If and to the extent any reimbursements to the General Partner pursuant
to this Section 7.7 constitute gross income of the General Partner (as opposed
to the repayment of advances made by the General Partner on behalf of the
Partnership) such amounts shall constitute guaranteed payments within the
meaning of Section 707(c) of the Code, shall be treated consistently therewith
by the Partnership and all Partners, and shall not be treated as distributions
for purposes of computing the Partners' Capital Accounts.

     J. Any indemnification hereunder is subject to, and limited by, the
provisions of Section 10-107 of the Act and Section 12.2.2 of the Charter.

     K. In the event the Partnership is made a party to any litigation or
otherwise incurs any loss or expense as a result of or in connection with any
Partner's personal obligations or liabilities unrelated to Partnership business,
such Partner shall indemnify and reimburse the Partnership for all such loss and
expense incurred, including legal fees, and the Partnership interest of such
Partner may be charged therefor. The liability of a Partner under this Section
7.7.K shall not be limited to such Partner's Partnership Interest, but shall be
enforceable against such Partner personally.

SECTION 7.8 LIABILITY OF THE GENERAL PARTNER

     A. Notwithstanding anything to the contrary set forth in this Agreement,
none of the General Partner nor any of its officers, directors, agents or
employees shall be liable or accountable in damages or otherwise to the
Partnership, any Partners or any Assignees, or their successors or assigns, for
losses sustained, liabilities incurred or benefits not derived as a result of
errors in judgment or mistakes of fact or law or any act or omission if the
General Partner acted in good faith.

     B. The Limited Partners expressly acknowledge that the General Partner is
acting for the benefit of the Partnership, the Limited Partners and the General
Partner's stockholders collectively. The General Partner is under no obligation
to give priority to the separate interests of the Limited Partners or the
General Partner's stockholders (including, without limitation, the tax
consequences to Limited Partners or


                                      -34-



Assignees or to stockholders) in deciding whether to cause the Partnership to
take (or decline to take) any actions. If there is a conflict between the
interests of the stockholders of the General Partner on one hand and the Limited
Partners on the other, the General Partner shall endeavor in good faith to
resolve the conflict in a manner not adverse to either the stockholders of the
General Partner or the Limited Partners; provided, however, that for so long as
the General Partner, owns a controlling interest in the Partnership, any such
conflict that cannot be resolved in a manner not adverse to either the
stockholders of the General Partner or the Limited Partners shall be resolved in
favor of the stockholders. The General Partner shall not be liable under this
Agreement to the Partnership or to any Partner for monetary damages for losses
sustained, liabilities incurred, or benefits not derived by Limited Partners in
connection with such decisions; provided, that the General Partner has acted in
good faith.

     C. Subject to its obligations and duties as General Partner set forth in
Section 7.1.A, the General Partner may exercise any of the powers granted to it
by this Agreement and perform any of the duties imposed upon it hereunder either
directly or by or through its agents. The General Partner shall not be
responsible for any misconduct or negligence on the part of any such agent
appointed by it in good faith.

     D. Any amendment, modification or repeal of this Section 7.8 or any
provision hereof shall be prospective only and shall not in any way affect the
limitations on the liability of the General Partner and any of its officers,
directors, agents and employee's liability to the Partnership and the Limited
Partners under this Section 7.8 as in effect immediately prior to such
amendment, modification or repeal with respect to claims arising from or
relating to matters occurring, in whole or in part, prior to such amendment,
modification or repeal, regardless of when such claims may arise or be asserted.

SECTION 7.9 OTHER MATTERS CONCERNING THE GENERAL PARTNER

     A. The General Partner may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, bond, debenture, or other
paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties.

     B. The General Partner may consult with legal counsel, accountants,
appraisers, management consultants, investment bankers and other consultants and
advisers selected by it, and any act taken or omitted to be taken in reliance
upon the opinion of such Persons as to matters which such General Partner
reasonably believes to be within such Person's professional or expert competence
shall be conclusively presumed to have been done or omitted in good faith and in
accordance with such opinion.

     C. The General Partner shall have the right, in respect of any of its
powers or obligations hereunder, to act through any of its duly authorized
officers and a duly appointed attorney or attorneys-in-fact. Each such attorney
shall, to the extent provided by the General Partner in the power of attorney,
have full power and authority to do and perform all and every act and duty which
is permitted or required to be done by the General Partner hereunder.

     D. Notwithstanding any other provisions of this Agreement or any
non-mandatory provision of the Act, any action of the General Partner on behalf
of the Partnership or any decision of the General Partner to refrain from acting
on behalf of the Partnership, undertaken in the good faith belief that such
action or omission is necessary or advisable in order to protect the ability of
the General Partner, for so long as the General Partner has determined to
qualify as a REIT, to (i) continue to qualify as a REIT or (ii) avoid the
General Partner incurring any taxes under Section 857 or Section 4981 of the
Code, is expressly authorized under this Agreement and is deemed approved by all
of the Limited Partners.


                                      -35-



SECTION 7.10 TITLE TO PARTNERSHIP ASSETS

     Title to Partnership assets, whether real, personal or mixed and whether
tangible or intangible, shall be deemed to be owned by the Partnership as an
entity, and no Partners, individually or collectively, shall have any ownership
interest in such Partnership assets or any portion thereof. Title to any or all
of the Partnership assets may be held in the name of the Partnership, the
General Partner or one or more subsidiaries or nominees, as the General Partner
may determine, including Affiliates of the General Partner. The General Partner
hereby declares and warrants that any Partnership assets for which legal title
is held in the name of the General Partner or any nominee or Affiliate of the
General Partner shall be held by the General Partner for the use and benefit of
the Partnership in accordance with the provisions of this Agreement; provided,
however, that the General Partner shall use its best efforts to cause beneficial
and record title to such assets to be vested in the Partnership, a subsidiary or
a nominee thereof, as soon as reasonably practicable. All Partnership assets
shall be recorded as the property of the Partnership in its books and records,
irrespective of the name in which legal title to such Partnership assets is
held.

SECTION 7.11 RELIANCE BY THIRD PARTIES

     Notwithstanding anything to the contrary in this Agreement, any Person
dealing with the Partnership shall be entitled to assume that the General
Partner has full power and authority to encumber, sell or otherwise use in any
manner any and all assets of the Partnership and to enter into any contracts on
behalf of the Partnership, and such Person shall be entitled to deal with the
General Partner as if it were the Partnership's sole party in interest, both
legally and beneficially. Each Limited Partner hereby waives any and all
defenses or other remedies which may be available against such Person to
contest, negate or disaffirm any action of the General Partner in connection
with any such dealing. In no event shall any Person dealing with the General
Partner or its representatives be obligated to ascertain that the terms of this
Agreement have been complied with or to inquire into the necessity or expedience
of any act or action of the General Partner or its representatives. Each and
every certificate, document or other instrument executed on behalf of the
Partnership by the General Partner or its representatives shall be conclusive
evidence in favor of any and every Person relying thereon or claiming thereunder
that (i) at the time of the execution and delivery of such certificate, document
or instrument, this Agreement was in full force and effect, (ii) the Person
executing and delivering such certificate, document or instrument was duly
authorized and empowered to do so for and on behalf of the Partnership and (iii)
such certificate, document or instrument was duly executed and delivered in
accordance with the terms and provisions of this Agreement and is binding upon
the Partnership.

SECTION 7.12 MANAGEMENT ASSISTANCE PROVIDED BY SPECIAL GENERAL PARTNER

     In addition to the requirement to obtain the Consent of the Special General
Partner with respect to certain matters as provided for in this Agreement, the
Special General Partner shall provide consulting services and assistance to the
Partnership at various times, in conjunction with the Advisor, for no additional
consideration, on matters relating to the following:

     (1)  the strategic planning of the Partnership;

     (2)  the creation of business plans of the Partnership;

     (3)  the sale, merger, or the sale of substantially all of the assets, of
          the Partnership; and

     (4)  any other matters concerning the Partnership as determined appropriate
          by the General Partner and the Special General Partner.


                                      -36-



                                   ARTICLE 8.
                   RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS

SECTION 8.1 LIMITATION OF LIABILITY

     The Limited Partners shall have no liability under this Agreement except as
expressly provided in this Agreement or under the Act.

SECTION 8.2 MANAGEMENT OF BUSINESS

     No Limited Partner or Assignee (other than the General Partner, any of its
Affiliates or any officer, director, employee, partner, agent or trustee of the
General Partner, the Partnership or any of their Affiliates, in their capacity
as such) shall take part in the operations, management or control (within the
meaning of the Act) of the Partnership's business, transact any business in the
Partnership's name or have the power to sign documents for or otherwise bind the
Partnership. The transaction of any such business by the General Partner, any of
its Affiliates or any officer, director, employee, partner, agent or trustee of
the General Partner, the Partnership or any of their Affiliates, in their
capacity as such, shall not affect, impair or eliminate the limitations on the
liability of the Limited Partners or Assignees under this Agreement.

SECTION 8.3 OUTSIDE ACTIVITIES OF LIMITED PARTNERS

     Subject to any agreements entered into by a Limited Partner or its
Affiliates with the General Partner, Partnership or a Subsidiary, any Limited
Partner and any officer, director, employee, agent, trustee, Affiliate or
stockholder of any Limited Partner shall be entitled to and may have business
interests and engage in business activities in addition to those relating to the
Partnership, including business interests and activities in direct competition
with the Partnership or that are enhanced by the activities of the Partnership.
Neither the Partnership nor any Partners shall have any rights by virtue of this
Agreement in any business ventures of any Limited Partner or Assignee. Subject
to such agreements, none of the Limited Partners nor any other Person shall have
any rights by virtue of this Agreement or the partnership relationship
established hereby in any business ventures of any other Person, other than the
Limited Partners benefiting from the business conducted by the General Partner,
and such Person shall have no obligation pursuant to this Agreement to offer any
interest in any such business ventures to the Partnership, any Limited Partner
or any such other Person, even if such opportunity is of a character which, if
presented to the Partnership, any Limited Partner or such other Person, could be
taken by such Person.

SECTION 8.4 RETURN OF CAPITAL

     Except pursuant to the rights of Redemption set forth in Section 8.6, no
Limited Partner shall be entitled to the withdrawal or return of his or her
Capital Contribution, except to the extent of distributions made pursuant to
this Agreement or upon termination of the Partnership as provided herein. No
Limited Partner or Assignee shall have priority over any other Limited Partner
or Assignee either as to the return of Capital Contributions, or as otherwise
expressly provided in this Agreement, or as to profits, losses, distributions or
credits.

SECTION 8.5 RIGHTS OF LIMITED PARTNERS RELATING TO THE PARTNERSHIP

     A. In addition to other rights provided by this Agreement or by the Act,
and except as limited by Section 8.5.C, each Limited Partner shall have the
right, for a purpose reasonably related to such Limited Partner's interest as a
limited partner in the Partnership, upon written demand with a statement of the
purpose of such demand and at such Limited Partner's expense:


                                      -37-



          (1) to obtain a copy of the most recent annual and quarterly reports
filed with the Securities and Exchange Commission by the General Partner
pursuant to the Exchange Act, and each communication sent to the stockholders of
the General Partner;

          (2) to obtain a copy of the Partnership's federal, state and local
income tax returns for each Partnership Year;

          (3) to obtain a current list of the name and last known business,
residence or mailing address of each Partner;

          (4) to obtain a copy of this Agreement and the Certificate and all
amendments thereto, together with executed copies of all powers of attorney
pursuant to which this Agreement, the Certificate and all amendments thereto
have been executed; and

          (5) to obtain true and full information regarding the amount of cash
and a description and statement of any other property or services contributed by
each Partner and which each Partner has agreed to contribute in the future, and
the date on which each became a Partner.

     B. The Partnership shall notify each Limited Partner in writing of any
adjustment made in the calculation of the REIT Shares Amount within a reasonable
time after the date such change becomes effective.

     C. Notwithstanding any other provision of this Section 8.5, the General
Partner may keep confidential from the Limited Partners, for such period of time
as the General Partner determines in its sole and absolute discretion to be
reasonable, any information that (i) the General Partner believes to be in the
nature of trade secrets or other information the disclosure of which the General
Partner in good faith believes is not in the best interests of the Partnership
or (ii) the Partnership or the General Partner is required by law or by
agreements with unaffiliated third parties to keep confidential.

SECTION 8.6 REDEMPTION RIGHTS

     A. At any time after one year following the date of issuance of any OP
Units to a Limited Partner or a Special General Partner, such Partner shall have
the right (subject to the terms and conditions set forth herein and in any other
such agreement, as applicable) to require the Partnership to redeem all or a
portion of the OP Units held by such Partner (such OP Units being hereafter
referred to as "Tendered Units") in exchange for the Cash Amount (a
"Redemption"); provided that the terms of such OP Units do not provide that such
OP Units are not entitled to a right of Redemption. Unless otherwise expressly
provided in this Agreement or in a separate agreement entered into between the
Partnership and the holders of such OP Units, all OP Units shall be entitled to
a right of Redemption hereunder. The Tendering Partner shall have no right, with
respect to any OP Units so redeemed, to receive any distributions paid on or
after the Specified Redemption Date. Any Redemption shall be exercised pursuant
to a Notice of Redemption delivered to the General Partner by the Special
General Partner or Limited Partner who is exercising the right (the "Tendering
Partner"). The Cash Amount shall be payable to the Tendering Partner within ten
(10) days of the Specified Redemption Date in accordance with the instructions
set forth in the Notice of Redemption.

     B. Notwithstanding Section 8.6.A above, if the Special General Partner or a
Limited Partner has delivered to the General Partner a Notice of Redemption then
the General Partner may, in its sole and absolute discretion (subject to the
limitations on ownership and transfer of REIT Shares set forth in the Charter),
elect to acquire some or all of the Tendered Units from the Tendering Partner in
exchange for the REIT Shares Amount (as of the Specified Redemption Date) and,
if the General Partner so elects, the Tendering Partner shall sell the Tendered
Units to the General Partner in exchange for the REIT Shares Amount. In such
event, the Tendering Partner shall have no right to cause the Partnership to
redeem such


                                      -38-



Tendered Units. The General Partner shall promptly give such Tendering Partner
written notice of its election, and the Tendering Partner may elect to withdraw
its redemption request at any time prior to the acceptance of the cash or REIT
Shares Amount by such Tendering Partner.

     C. The REIT Shares Amount, if applicable, shall be delivered as duly
authorized, validly issued, fully paid and nonassessable REIT Shares and, if
applicable, free of any pledge, lien, encumbrance or restriction, other than
those provided in the Charter, the Bylaws of the General Partner, the Securities
Act, relevant state securities or blue sky laws and any applicable registration
rights agreement with respect to such REIT Shares entered into by the Tendering
Partner. Notwithstanding any delay in such delivery (but subject to Section
8.6.E), the Tendering Partner shall be deemed the owner of such REIT Shares for
all purposes, including without limitation, rights to vote or consent, and
receive dividends, as of the Specified Redemption Date.

     D. The Special General Partner and each Limited Partner covenants and
agrees with the General Partner that all Tendered Units shall be delivered to
the General Partner free and clear of all liens, claims and encumbrances
whatsoever and should any such liens, claims and/or encumbrances exist or arise
with respect to such Tendered Units, the General Partner shall be under no
obligation to acquire the same. The Special General Partner and each Limited
Partner further agrees that, in the event any state or local property transfer
tax is payable as a result of the transfer of its Tendered Units to the General
Partner (or its designee), such Partner shall assume and pay such transfer tax.

     E. Notwithstanding the provisions of Section 8.6.A, 8.6.B, 8.6.C or any
other provision of this Agreement, the Special General Partner or a Limited
Partner (i) shall not be entitled to effect a Redemption for cash or an exchange
for REIT Shares to the extent the ownership or right to acquire REIT Shares
pursuant to such exchange by such Partner on the Specified Redemption Date could
cause such Partner or any other Person, or, in the opinion of counsel selected
by the General Partner, may cause such Partner or any other Person, to violate
the restrictions on ownership and transfer of REIT Shares set forth in the
Charter and (ii) shall have no rights under this Agreement to acquire REIT
Shares which would otherwise be prohibited under the Charter. To the extent any
attempted Redemption or exchange for REIT Shares would be in violation of this
Section 8.6.E, it shall be null and void ab initio and such Partner shall not
acquire any rights or economic interest in the cash otherwise payable upon such
Redemption or the REIT Shares otherwise issuable upon such exchange.

     F. Notwithstanding anything herein to the contrary (but subject to Section
8.6.E), with respect to any Redemption or exchange for REIT Shares pursuant to
this Section 8.6:

          (1) All OP Units acquired by the General Partner pursuant thereto
shall automatically, and without further action required, be converted into and
deemed to be Limited Partner Interests comprised of the same number and class of
OP Units.

          (2) The Special General Partner and each Limited Partner may not
effect a Redemption for less than one thousand (1,000) OP Units or, if such
Partner holds less than one thousand (1,000) OP Units, such Partner may effect a
Redemption only with respect to all OP Units held by such Partner.

          (3) A Tendering Partner may not effect more than two (2) Redemptions
in a single calendar year.

          (4) Without the consent of the General Partner, the Special General
Partner and each Limited Partner may not effect a Redemption during the period
after the Partnership Record Date with respect to a distribution and before the
record date established by the General Partner for a distribution to its
stockholders of some or all of its portion of such distribution.


                                      -39-



          (5) The consummation of any Redemption or exchange for REIT Shares
shall be subject to the expiration or termination of the applicable waiting
period, if any, under the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended.

          (6) Each Tendering Partner shall continue to own all OP Units subject
to any Redemption or exchange for REIT Shares, and be treated as a Partner with
respect to such OP Units for all purposes of this Agreement, until such OP Units
are transferred to the General Partner and paid for or exchanged on the
Specified Redemption Date. Until a Specified Redemption Date, the Tendering
Partner shall have no rights as a stockholder of the General Partner with
respect to such Tendering Partner's OP Units.

     G. In the event that the Partnership issues additional Partnership
Interests to any Additional Limited Partner pursuant to Section 4.3.B, the
General Partner shall make such revisions to this Section 8.6 as it determines
are necessary to reflect the issuance of such additional Partnership Interests.

     H. Notwithstanding any other provision of this Agreement, the General
Partner is authorized to take any action that it determines to be necessary or
appropriate to cause the partnership to comply with any withholding requirements
established under the Code or any other federal, state or local law that apply
upon a Redemption or exchange of Tendered Units. If a Tendering Partner believes
that it is exempt from withholding upon a Redemption or exchange of Tendered
Units, such Partner must furnish the General Partner a FIRPTA certificate or
other documentation requested by the General Partner is a form acceptable to the
General Partner. If the Partnership or the General Partner is required to
withhold and pay over to any taxing authority any amount upon a Redemption or
exchange of Tendered Units and the Cash Amount or the REIT Shares Amount, as the
case may be, equals or exceeds the amount of tax required to be withheld, the
amount withheld shall be treated as an amount received by such Partner in
redemption of its Tendered Units. If the Cash Amount or the REIT Shares Amount,
as the case may be, is less than the amount of tax required to be withheld, the
Tendering Partner shall not receive any Cash Amount or REIT Shares Amount, and
the Tendering Partner shall contribute the excess of the amount of tax required
to be withheld over the Cash Amount or REIT Shares Amount before such excess
taxes are required to be paid to the taxing authority.

                                   ARTICLE 9.
                     BOOKS, RECORDS, ACCOUNTING AND REPORTS

SECTION 9.1 RECORDS AND ACCOUNTING

     The General Partner shall keep, or cause to be kept, at the principal
office of the Partnership appropriate books and records with respect to the
Partnership's business, including without limitation, all books and records
necessary to provide to the Special General Partner and the Limited Partners any
information, lists and copies of documents required to be provided pursuant to
Section 9.3. Any records maintained by or on behalf of the Partnership in the
regular course of its business may be kept on, or be in the form of any
information storage device, provided, that the records so maintained are
convertible into clearly legible written form within a reasonable period of
time. The books of the Partnership shall be maintained, for financial and tax
reporting purposes, on an accrual basis in accordance with generally accepted
accounting principles.

SECTION 9.2 FISCAL YEAR

     The fiscal year of the Partnership shall be the calendar year.

SECTION 9.3 REPORTS

     A. As soon as practicable, but in no event later than 105 days after the
close of each Partnership Year, or such earlier date as they are filed with the
Securities and Exchange Commission, the General Partner shall


                                      -40-



cause to be delivered to the Special General Partner and each Limited Partner as
of the close of the Partnership Year, an annual report containing financial
statements of the Partnership, or of the General Partner if such statements are
prepared solely on a consolidated basis with the General Partner, for such
Partnership Year, presented in accordance with generally accepted accounting
principles, such statements to be audited by a nationally recognized firm of
independent public accountants selected by the General Partner.

     B. As soon as practicable, but in no event later than 45 days after the
close of each calendar quarter (except the last calendar quarter of each year),
or such earlier date as they are filed with the Securities and Exchange
Commission, the General Partner shall cause to be delivered to the Special
General Partner and each Limited Partner as of the last day of the calendar
quarter, a report containing unaudited financial statements of the Partnership,
or of the General Partner, if such statements are prepared solely on a
consolidated basis with the applicable law or regulation, or as the General
Partner determines to be appropriate.

SECTION 9.4 NONDISCLOSURE OF CERTAIN INFORMATION

     Notwithstanding the provisions of Sections 9.1 and 9.3, the General Partner
may keep confidential from the Special General Partner and the Limited Partners
any information that the General Partner believes to be in the nature of trade
secrets or other information the disclosure of which the General Partner in good
faith believes is not in the best interest of the Partnership or which the
Partnership is required by law or by agreements with unaffiliated third parties
to keep confidential.

                                   ARTICLE 10.
                                   TAX MATTERS

SECTION 10.1 PREPARATION OF TAX RETURNS

     The General Partner shall arrange for the preparation and timely filing of
all returns of Partnership income, gains, deductions, losses and other items
required of the Partnership for federal and applicable state income tax purposes
and shall use all reasonable efforts to furnish, within 90 days of the close of
each taxable year, the tax information reasonably required by the Special
General Partner and the Limited Partners for federal and applicable state income
tax reporting purposes. The Special General Partner and each Limited Partner
shall promptly provide the General Partner with any information reasonably
requested by the General Partner relating to any Contributed Property
contributed (directly or indirectly) by such Partner to the Partnership.

SECTION 10.2 TAX ELECTIONS

     Except as otherwise provided herein, the General Partner shall, in its sole
and absolute discretion, determine whether to make any available election
pursuant to the Code, including the election under Section 754 of the Code. The
General Partner shall have the right to seek to revoke any such election
(including without limitation, any election under Section 754 of the Code) upon
the General Partner's determination in its sole and absolute discretion that
such revocation is the best interests of the Partners.

SECTION 10.3 TAX MATTERS PARTNER

     A. The General Partner shall be the "tax matters partner" of the
Partnership for federal income tax purposes. Pursuant to Section 6230(e) of the
Code, upon receipt of notice from the IRS of the beginning of an administrative
proceeding with respect to the Partnership, the tax matters partner shall
furnish the IRS with the name, address and profit interest of the Special
General Partner and each of the Limited Partners and Assignees; provided,
however, that such information is provided to the Partnership by the Partners
and Assignees.


                                      -41-



     B. The tax matters partner is authorized, but not required:

          (1) to enter into any settlement with the IRS with respect to any
administrative or judicial proceedings for the adjustment of Partnership items
required to be taken into account by a Partner for income tax purposes (such
administrative proceedings being referred to as a "tax audit" and such judicial
proceedings being referred to as "judicial review"), and in the settlement
agreement the tax matters partner may expressly state that such agreement shall
bind all Partners, except that such settlement agreement shall not bind any
Partner (i) who (within the time prescribed pursuant to the Code and
Regulations) files a statement with the IRS providing that the tax matters
partner shall not have the authority to enter into a settlement agreement on
behalf of such Partner or (ii) who is a "notice partner" (as defined in Section
6231 of the Code) or a member of a "notice group" (as defined in Section
6223(b)(2) of the Code);

          (2) in the event that a notice of a final administrative adjustment at
the Partnership level of any item required to be taken into account by a Partner
for tax purposes (a "final adjustment") is mailed to the tax matters partner, to
seek judicial review of such final adjustment, including the filing of a
petition for readjustment with the Tax Court or the United States Claims Court,
or the filing of a complaint for refund with the District Court of the United
States for the district in which the Partnership's principal place of business
is located;

          (3) to intervene in any action brought by any other Partner for
judicial review of a final adjustment;

          (4) to file a request for an administrative adjustment with the IRS at
any time and, if any part of such request is not allowed by the IRS, to file an
appropriate pleading (petition or complaint) for judicial review with respect to
such request;

          (5) to enter into an agreement with the IRS to extend the period for
assessing any tax which is attributable to any item required to be taken into
account by a Partner for tax purposes, or an item affected by such item; and

          (6) to take any other action on behalf of the Partners of the
Partnership in connection with any tax audit or judicial review proceeding to
the extent permitted by applicable law or regulations.

     The taking of any action and the incurring of any expense by the tax
matters partner in connection with any such proceeding, except to the extent
required by law, is a matter in the sole and absolute discretion of the tax
matters partner and the provisions relating to indemnification of the General
Partner set forth in Section 7.7 shall be fully applicable to the tax matters
partner in its capacity as such.

     C. The tax matters partner shall receive no compensation for its services.
All third party costs and expenses incurred by the tax matters partner in
performing its duties as such (including legal and accounting fees) shall be
borne by the Partnership. Nothing herein shall be construed to restrict the
Partnership from engaging an accounting firm to assist the tax matters partner
in discharging its duties hereunder, so long as the compensation paid by the
Partnership for such services is reasonable.

SECTION 10.4 ORGANIZATIONAL EXPENSES

     The Partnership shall elect to deduct expenses, if any, incurred by it in
organizing the Partnership as provided in Section 709 of the Code.

SECTION 10.5 WITHHOLDING

     The Special General Partner and each Limited Partner hereby authorize the
Partnership to withhold from or pay on behalf of or with respect to such Partner
any amount of federal, state, local, or foreign taxes that the General Partner
determines that the Partnership is required to withhold or pay with respect to
any


                                      -42-



amount distributable or allocable to such Partner pursuant to this Agreement,
including, without limitation, any taxes required to be withheld or paid by the
Partnership pursuant to Sections 1441, 1442, 1445 or 1446 of the Code. Any
amount paid on behalf of or with respect to the Special General Partner or a
Limited Partner shall constitute a receivable of the Partnership from such
Partner, which receivable shall be paid by such Partner within 15 days after
notice from the General Partner that such payment must be made unless (i) the
Partnership withholds such payment from a distribution which would otherwise be
made to the Partner or (ii) the General Partner determines, in its sole and
absolute discretion, that such payment may be satisfied out of the available
funds of the Partnership which would, but for such payment, be distributed to
the Partner. Any amounts withheld pursuant to the foregoing clauses (i) or (ii)
shall be treated as having been distributed to such Partner. The Special General
Partner and each Limited Partner hereby unconditionally and irrevocably grants
to the Partnership a security interest in such Partner's Partnership Interest to
secure such Partner's obligation to pay to the Partnership any amounts required
to be paid pursuant to this Section 10.5. Any amounts payable by the Special
General Partner or a Limited Partner hereunder shall bear interest at the base
rate on corporate loans at large United States money center commercial banks, as
published from time to time in the Wall Street Journal, plus two percentage
points (but not higher than the maximum lawful rate) from the date such amount
is due (i.e., 15 days after demand) until such amount is paid in full. The
Special General Partner and each Limited Partner shall take such actions as the
Partnership or the General Partner shall request in order to perfect or enforce
the security interest created hereunder.

                                   ARTICLE 11.
                            TRANSFERS AND WITHDRAWALS

SECTION 11.1 TRANSFER

     A. The term "transfer," when used in this Article 11 with respect to a
Partnership Interest, shall be deemed to refer to a transaction by which a
Partner purports to assign its Partnership Interest to another Person and
includes a sale, assignment, gift (outright or in trust), pledge, encumbrance,
hypothecation, mortgage, exchange or any other disposition by law or otherwise.
The term "transfer" when used in this Article 11 does not include any Redemption
or exchange for REIT Shares pursuant to Section 8.6, except as otherwise
provided herein. No part of the interest of a Limited Partner shall be subject
to the claims of any creditor, any spouse for alimony or support, or to legal
process, and may not be voluntarily or involuntarily alienated or encumbered
except as may be specifically provided for in this Agreement or consented to by
the General Partner and the Special General Partner.

     B. No Partnership Interest shall be transferred, in whole or in part,
except in accordance with the terms and conditions set forth in this Article 11.
Any transfer or purported transfer of a Partnership Interest not made in
accordance with this Article 11 shall be null and void ab initio unless
otherwise consented to by the General Partner and the Special General Partner in
their sole and absolute discretion.

SECTION 11.2 TRANSFER OF THE PARTNERSHIP INTEREST OF THE GENERAL PARTNER AND THE
SPECIAL GENERAL PARTNER

     A. The General Partner shall not (i) withdraw from the Partnership, (ii)
directly or indirectly transfer all or any portion of its interest in the
Partnership, or (iii) engage in any merger, consolidation, or other combination
with or into another Person, sale of all or substantially all of its assets or
any reclassification or recapitalization of its outstanding equity interests (an
"Extraordinary Transaction"), without the Consent of the Partners, which may be
given or withheld by each Partner in his, her or its sole and absolute
discretion. In addition, if an Extraordinary Transaction would result in the
termination of the Advisory Agreement, the Partnership must either (i) purchase
the Special General Partner Interest as provided under Section 11.7, or (ii)
obtain the Consent of the Special General Partner. Upon any transfer of a
Partnership Interest in accordance with the provisions of this Section 11.2, the
transferee shall become a Substitute General Partner for all purposes herein,
and shall be vested with the powers and rights of the transferor General
Partner, and shall be liable for all obligations and responsible for all duties
of the General Partner, once


                                      -43-



such transferee has executed such instruments as may be necessary to effectuate
such admission and to confirm the agreement of such transferee to be bound by
all the terms and provisions of this Agreement with respect to the Partnership
Interest so acquired. It is a condition to any transfer otherwise permitted
hereunder that the transferee assumes, by operation of law or express agreement,
all of the obligations of the transferor General Partner under this Agreement
with respect to such transferred Partnership Interest, and no such transfer
(other than pursuant to a statutory merger or consolidation wherein all
obligations and liabilities of the transferor General Partner are assumed by a
successor corporation by operation of law) shall relieve the transferor General
Partner of its obligations under this Agreement without the Consent of the
Limited Partners, in their reasonable discretion. In the event the General
Partner withdraws from the Partnership in violation of this Agreement or
otherwise, or otherwise dissolves or terminates, or upon the Incapacity of the
General Partner, all of the remaining Partners may elect to continue the
Partnership business by selecting a Substitute General Partner in accordance
with the Act

     B. Notwithstanding any other provision of this Agreement, the Special
General Partner shall not transfer all or any portion of its Partnership
Interest to any transferee without the consent of the General Partner, which
consent may be withheld in the sole and absolute discretion of the General
Partner. Notwithstanding the preceding sentence, however, the Special General
Partner shall have the right, at any time, to transfer its Partnership Interest
to the General Partner or to an Affiliate of the General Partner.

SECTION 11.3 LIMITED PARTNERS' RIGHTS TO TRANSFER

     A. Prior to the first anniversary of the Effective Date, no Limited Partner
shall transfer all or any portion of its Partnership Interest to any transferee
without the consent of the General Partner and the Special General Partner,
which consent may be withheld in their sole and absolute discretion; provided,
however, that any Limited Partner may, at any time, without the consent of the
General Partner and the Special General Partner, (i) transfer all or any portion
of its Partnership Interest to the General Partner, (ii) transfer all or any
portion of its Partnership Interest to an Affiliate, another original Limited
Partner or to an Immediate Family Member, subject to the provisions of Section
11.6, (iii) transfer all or any portion of its Partnership Interest to a trust
for the benefit of a charitable beneficiary or to a charitable foundation,
subject to the provisions of Section 11.6, and (iv) subject to the provisions of
Section 11.6, pledge (a "Pledge") all or any portion of its Partnership Interest
to a lending institution, which is not an Affiliate of such Limited Partner, as
collateral or security for a bona fide loan or other extension of credit, and
transfer such pledged Partnership Interest to such lending institution in
connection with the exercise of remedies under such loan or extension or credit,
and the transfer of such pledged Partnership Interest by the lender to any
transferee. After such anniversary, each Limited Partner or Assignee (resulting
from a transfer made pursuant to clauses (i)-(iv) of the proviso of the
preceding sentence) shall have the right to transfer all or any portion of its
Partnership Interest, subject to the provisions of Section 11.6 and the
satisfaction of each of the following conditions (in addition to the right of
each such Limited Partner or Assignee to continue to make any such transfer
permitted by clauses (i)-(iv) of such proviso without satisfying either of the
following conditions):

          (1) General Partner Right of First Refusal. The transferring Partner
shall give written notice of the proposed transfer to the General Partner, which
notice shall state (i) the identity of the proposed transferee, and (ii) the
amount and type of consideration proposed to be received for the transferred OP
Units. The General Partner shall have ten (10) business days upon which to give
the transferring Partner notice of its election to acquire the OP Units on the
proposed terms. If it so elects, it shall purchase the OP Units on such terms
within ten (10) business days after giving notice of such election. If it does
not so elect, the transferring Partner may transfer such OP Units to a third
party, on economic terms no more favorable to the transferee than the proposed
terms, subject to the other conditions of this Section 11.3.

          (2) Qualified Transferee. Any transfer of a Partnership Interest shall
be made only to Qualified Transferees. It is a condition to any transfer
otherwise permitted hereunder that the transferee assumes by operation of law or
express agreement all of the obligations of the transferor Limited Partner under
this


                                      -44-



Agreement with respect to such transferred Partnership Interest and no such
transfer (other than pursuant to a statutory merger or consolidation wherein all
obligations and liabilities of the transferor Partner are assumed by a successor
corporation by operation of law) shall relieve the transferor Partner of its
obligations under this Agreement without the approval of the General Partner, in
its reasonable discretion. Notwithstanding the foregoing, any transferee of any
transferred Partnership Interest shall be subject to any and all ownership
limitations contained in the Charter, which may limit or restrict such
transferee's ability to exercise its Redemption rights, and to the
representations in Section 3.4.D. Any transferee, whether or not admitted as a
Substituted Limited Partner, shall take subject to the obligations of the
transferor hereunder. Unless admitted as a Substituted Limited Partner, no
transferee, whether by a voluntary transfer, by operation of law or otherwise,
shall have any rights hereunder, other than the rights of an Assignee as
provided in Section 11.5.

     B. If a Limited Partner is subject to Incapacity, the executor,
administrator, trustee, committee, guardian, conservator, or receiver of such
Limited Partner's estate shall have all the rights of a Limited Partner, but not
more rights than those enjoyed by other Limited Partners, for the purpose of
settling or managing the estate, and such power as the Incapacitated Limited
Partner possessed to transfer all or any part of his or its interest in the
Partnership. The Incapacity of a Limited Partner, in and of itself, shall not
dissolve or terminate the Partnership.

     C. The General Partner may prohibit any transfer otherwise permitted under
Section 11.3 by a Limited Partner of his or her OP Units if, in the opinion of
legal counsel to the Partnership, such transfer would require the filing of a
registration statement under the Securities Act by the Partnership or would
otherwise violate any federal or state securities laws or regulations applicable
to the Partnership or the Partnership Unit.

SECTION 11.4 SUBSTITUTED LIMITED PARTNERS

     A. No Limited Partner shall have the right to substitute a transferee as a
Limited Partner in his or her place (including any transferee permitted by
Section 11.3). The General Partner shall, however, have the right to consent to
the admission of a transferee of the interest of a Limited Partner pursuant to
this Section 11.4 as a Substituted Limited Partner, which consent may be given
or withheld by the General Partner in its sole and absolute discretion. The
General Partner's failure or refusal to permit a transferee of any such
interests to become a Substituted Limited Partner shall not give rise to any
cause of action, whether at law or in equity, against the Partnership or any
Partner.

     B. A transferee who has been admitted as a Substituted Limited Partner in
accordance with this Article 11 shall have all the rights and powers and be
subject to all the restrictions and liabilities of a Limited Partner under this
Agreement. The admission of any transferee as a Substituted Limited Partner
shall be subject to the transferee executing and delivering to the General
Partner an acceptance of all of the terms and conditions of this Agreement
(including without limitation, the provisions of Section 2.4 and such other
documents or instruments as may be required to effect the admission), each in
form and substance satisfactory to the General Partner) and the acknowledgment
by such transferee that each of the representations and warranties set forth in
Section 3.4 are true and correct with respect to such transferee as of the date
of the transfer of the Partnership Interest to such transferee and will continue
to be true to the extent required by such representations and warranties.

     C. Upon the admission of a Substituted Limited Partner, the General Partner
shall amend Exhibit A to reflect the name, address, number of OP Units, and
Percentage Interest of such Substituted Limited Partner and to eliminate or
adjust, if necessary, the name, address and interest of the predecessor of such
Substituted Limited Partner.


                                      -45-



SECTION 11.5 ASSIGNEES

     If the General Partner, in its sole and absolute discretion, does not
consent to the admission of any permitted transferee under Section 11.3 as a
Substituted Limited Partner, as described in Section 11.4, such transferee shall
be considered an Assignee for purposes of this Agreement. An Assignee shall be
entitled to all the rights of an assignee of a limited partnership interest
under the Act, including the right to receive distributions from the Partnership
and the share of Net Income, Net Loss, gain and loss attributable to the OP
Units assigned to such transferee, the rights to transfer the OP Units provided
in this Article 11, the right of Redemption provided in Section 8.6, but shall
not be deemed to be a holder of OP Units for any other purpose under this
Agreement, and shall not be entitled to effect a Consent with respect to such OP
Units on any matter presented to the Limited Partners for approval (such Consent
remaining with the transferor Limited Partner). In the event any such transferee
desires to make a further assignment of any such Partnership Units, such
transferee shall be subject to all the provisions of this Article 11 to the same
extent and in the same manner as any Limited Partner desiring to make an
assignment of OP Units. Notwithstanding anything contained in this Agreement to
the contrary, as a condition to becoming an Assignee, any prospective Assignee
must first execute and deliver to the Partnership an acknowledgment that each of
the representations and warranties set forth in Section 3.4 are true and correct
with respect to such prospective Assignee as of the date of the prospective
assignment of the Partnership Interest to such prospective Assignee and will
continue to be true to the extent required by such representations or
warranties.

SECTION 11.6 GENERAL PROVISIONS

     A. No Limited Partner may withdraw from the Partnership other than as a
result of (i) a permitted transfer of all of such Limited Partner's OP Units in
accordance with this Article 11 and the transferee(s) of such Partnership Units
being admitted to the Partnership as a Substituted Limited Partner or (ii)
pursuant to the exercise of its right of Redemption of all of such Limited
Partner's OP Units under Section 8.6; provided that after such transfer,
exchange or redemption such Limited Partner owns no Partnership Interest.

     B. Any Limited Partner who shall transfer all of such Limited Partner's OP
Units in a transfer permitted pursuant to this Article 11 where such transferee
was admitted as a Substituted Limited Partner or pursuant to the exercise of its
rights of Redemption of all of such Limited Partner's OP Units under Section 8.6
shall cease to be a Limited Partner; provided that after such transfer, exchange
or redemption such Limited Partner owns no Partnership Interest.

     C. Transfers pursuant to this Article 11 may only be made on the first day
of a fiscal quarter of the Partnership, unless the General Partner otherwise
agrees.

     D. If any Partnership Interest is transferred, assigned or redeemed during
any quarterly segment of the Partnership's Partnership Year in compliance with
the provisions of this Article 11 or transferred or redeemed pursuant to Section
8.6, on any day other than the first day of a Partnership Year, then Net Income,
Net Loss, each item thereof and all other items attributable to such Partnership
Interest for such Partnership Year shall be divided and allocated between the
transferor Partner and the transferee Partner by taking into account their
varying interests during the Partnership Year using a method selected by the
General Partner that is in accordance with Section 706(d) of the Code. Except as
otherwise agreed by the General Partner, all distributions of Available Cash
with respect to which the Partnership Record Date is before the date of such
transfer, assignment, exchange or redemption shall be made to the transferor
Partner, and all distributions of Available Cash thereafter, in the case of a
transfer or assignment other than a redemption, shall be made to the transferee
Partner.

     E. In addition to any other restrictions on transfer herein contained,
including without limitation the provisions of this Article 11, in no event may
any transfer or assignment of a Partnership Interest by any


                                      -46-



Partner (including pursuant to a Redemption or exchange for REIT Shares by the
Partnership or the General Partner) be made (i) to any person or entity who
lacks the legal right, power or capacity to own a Partnership Interest; (ii) in
violation of applicable law; (iii) except with the consent of the General
Partner, which may be given or withheld in its sole and absolute discretion, of
any component portion of a Partnership Interest, such as the Capital Account, or
rights to distributions, separate and apart from all other components of a
Partnership Interest; (iv) except with the consent of the General Partner, which
may be given or withheld in its sole and absolute discretion, if in the opinion
of legal counsel to the Partnership such transfer could cause a termination of
the Partnership for federal or state income tax purposes (except as a result of
the Redemption or exchange for REIT Shares of all Partnership Interests held by
all Limited Partners or pursuant to a transaction expressly permitted under
Section 11.2); (v) if in the opinion of counsel to the Partnership such transfer
could cause the Partnership to cease to be classified as a partnership for
federal income tax purposes (except as a result of the Redemption or exchange
for REIT Shares of all Partnership Interests held by all Limited Partners); (vi)
if such transfer could, in the opinion of counsel to the Partnership, cause the
Partnership to become, with respect to any employee benefit plan subject to
Title I of ERISA, a "party-in-interest" (as defined in Section 3(14) of ERISA)
or a "disqualified person" (as defined in Section 4975(c) of the Code); (vii) if
such transfer could, in the opinion of counsel to the Partnership, cause any
portion of the assets of the Partnership to constitute assets of any employee
benefit plan pursuant to Department of Labor Regulations Section 2510.2-101;
(viii) if such transfer requires the registration of such Partnership Interest
pursuant to any applicable federal or state securities laws; (ix) except with
the consent of the General Partner, which may be given or withheld in its sole
and absolute discretion, if such transfer (1) could be treated as effectuated
through an "established securities market" or a "secondary market" (or the
substantial equivalent thereof) within the meaning of Section 7704 of the Code,
(2) could cause the Partnership to become a "publicly traded partnership," as
such term is defined in Sections 469(k)(2) or 7704(b) of the Code, (3) could be
in violation of Section 3.4.E(5), or (4) could cause the Partnership to fail one
or more of the Safe Harbors (as defined below); (x) if such transfer subjects
the Partnership to be regulated under the Investment Company Act of 1940, the
Investment Advisors Act of 1940 or the Employee Retirement Income Security Act
of 1974, each as amended; (xi) except with the consent of the General Partner,
which may be given or withheld in its sole discretion, if the transferee or
assignee of such Partnership Interest is unable to make the representations set
forth in Section 3.4.C; (xii) if such transfer is made to a lender to the
Partnership or any Person who is related (within the meaning of Section
1.752-4(b) of the Regulations) to any lender to the Partnership whose loan
constitutes a Nonrecourse Liability, except with the consent of the General
Partner, which may be given or withheld in its sole and absolute discretion; and
provided, that, as a condition to granting such consent the lender may be
required to enter into an arrangement with the Partnership and the General
Partner to redeem or exchange for the REIT Shares Amount any OP Units in which a
security interest is held simultaneously with the time at which such lender
would be deemed to be a partner in the Partnership for purposes of allocating
liabilities to such lender under Section 752 of the Code; or (xiii) if in the
opinion of legal counsel for the Partnership such transfer could adversely
affect the ability of the General Partner to continue to qualify as a REIT or,
except with the consent of the General Partner, which may be given or withheld
in its sole and absolute discretion, subject the General Partner to any
additional taxes under Section 857 or Section 4981 of the Code.

     F. The General Partner shall monitor the transfers of interests in the
Partnership (including any acquisition of OP Units by the Partnership or the
General Partner) to determine (i) if such interests could be treated as being
traded on an "established securities market" or a "secondary market (or the
substantial equivalent thereof)" within the meaning of Section 7704 of the Code
and (ii) whether such transfers of interests could result in the Partnership
being unable to qualify for the "safe harbors" set forth in Regulations Section
1.7704-1 (or such other guidance subsequently published by the IRS setting forth
safe harbors under which interests will not be treated as "readily tradable on a
secondary market (or the substantial equivalent thereof)" within the meaning of
Section 7704 of the Code) (the "Safe Harbors"). The General Partner shall have
the authority (but shall not be required) to take any steps it determines are
necessary or appropriate in its sole and absolute discretion to prevent any
trading of interests which could cause the Partnership to become a "publicly
traded partnership" within the meaning of Code Section 7704,


                                      -47-



or any recognition by the Partnership of such transfers, or to ensure that one
or more of the Safe Harbors is met.

SECTION 11.7 CALL RIGHT ATTRIBUTABLE TO THE SPECIAL GENERAL PARTNER INTEREST

     A. In the event of a "Trigger Event" (as defined in Section 11.7B hereof),
the Partnership shall have the right (the "Call Right") to redeem all, or any
portion, of the Special General Partner Interest. The Partnership shall exercise
the Call Right by providing the Special General Partner with written notice of
its desire to exercise the Call Right within sixty (60) days of the occurrence
of a Trigger Event. The purchase price to be paid by the Partnership for the
portion of the Special General Partner Interest that is subject to the Call
Right shall equal the fair market value of such Interest as determined by
Appraisal, and, subject to Section 11.C below, shall be paid in cash or in REIT
Shares (at the option of the Special General Partner) within one hundred twenty
(120) days after the Partnership provides the written notice required under this
Section 11.7.A.

     B. For purposes of this Section 11.7, a Trigger Event means, at any time
after the second anniversary of the Effective Date, the:

          (1)  expiration of the Advisory Agreement with the consent of the
               Advisor;

          (2)  termination of the Advisory Agreement for any reason other than
               by the Advisor if an Affiliate of the Advisor does not serve as
               the advisor under any replacement advisory agreement; or

          (3)  resignation of the Advisor under the Advisory Agreement for "Good
               Reason" (as defined in the Advisory Agreement).

     C. In the event that the Partnership exercises the Call Right as a result
of a termination of the Advisory Agreement for "Cause" (as defined in the
Advisory Agreement), the Partnership shall have the option to redeem all or a
portion of the Special General Partner Interest by issuing its promissory note
with (i) a term of five (5) years; (ii) annual installments of principal payable
ratably over the term of the note; and (iii) a market rate of interest.

SECTION 11.8 PUT RIGHT OF GENERAL PARTNER

     The General Partner shall have the right at any time (the "GP Put Right")
to require the Partnership to redeem any portion of the General Partner Interest
for the purpose of providing the General Partner with sufficient funds to enable
it to make redemptions of its stock. The General Partner shall exercise the GP
Put Right at any time by providing the Partnership with written notice of its
desire to exercise the GP Put Right. The purchase price to be paid by the
Partnership for the portion of the General Partner Interest that the General
Partner desires to be redeemed shall equal the fair market value of such portion
as determined by Appraisal, and shall be paid in cash within one hundred twenty
(120) days after the General Partner provides the written notice required under
this Section 11.8. In the event that the General Partner exercises the GP Put
Right, the OP Units held by the General Partner shall be reduced as appropriate.

                                   ARTICLE 12.
                              ADMISSION OF PARTNERS

SECTION 12.1 ADMISSION OF SUCCESSOR GENERAL PARTNER

     A successor to all of the General Partner's General Partner Interest
pursuant to Section 11.2 who is proposed to be admitted as a successor General
Partner shall be admitted to the Partnership as the General Partner, effective
upon such transfer. Any such transferee shall carry on the business of the
Partnership


                                      -48-



without dissolution. In each case, the admission shall be subject to the
successor General Partner executing and delivering to the Partnership an
acceptance of all of the terms and conditions of this Agreement and such other
documents or instruments as may be required to effect the admission. In the case
of such admission on any day other than the first day of a Partnership Year, all
items attributable to the General Partner Interest for such Partnership Year
shall be allocated between the transferring General Partner and such successor
as provided in Article 11.

SECTION 12.2 ADMISSION OF ADDITIONAL LIMITED PARTNERS

     A. After the admission to the Partnership of the initial Limited Partners
on the date hereof, a Person who makes a Capital Contribution to the Partnership
in accordance with this Agreement shall be admitted to the Partnership as an
Additional Limited Partner only upon furnishing to the General Partner (i)
evidence of acceptance in form satisfactory to the General Partner of all of the
terms and conditions of this Agreement, including, without limitation, the power
of attorney granted in Section 2.4 and (ii) such other documents or instruments
as may be required in the discretion of the General Partner in order to effect
such Person's admission as an Additional Limited Partner.

     B. Notwithstanding anything to the contrary in this Section 12.2, no Person
shall be admitted as an Additional Limited Partner without the consent of the
General Partner, which consent may be given or withheld in the General Partner's
sole and absolute discretion. The admission of any Person as an Additional
Limited Partner shall become effective on the date upon which the name of such
Person is recorded on the books and records of the Partnership, following the
receipt of the Capital Contribution in respect of such Limited Partner and the
consent of the General Partner to such admission. If any Additional Limited
Partner is admitted to the Partnership on any day other than the first day of a
Partnership Year, then Net Income, Net Loss, each item thereof and all other
items allocable among Partners and Assignees for such Partnership Year shall be
allocated among such Limited Partner and all other Partners and Assignees by
taking into account their varying interests during the Partnership Year using a
method selected by the General Partner that is in accordance with Section 706(d)
of the Code. All distributions of Available Cash with respect to which the
Partnership Record Date is before the date of such admission shall be made
solely to Partners and Assignees other than the Additional Limited Partner
(other than in its capacity as an Assignee) and, except as otherwise agreed to
by the Additional Limited Partners and the General Partner, all distributions of
Available Cash thereafter shall be made to all Partners and Assignees including
such Additional Limited Partner.

SECTION 12.3 AMENDMENT OF AGREEMENT AND CERTIFICATE OF LIMITED PARTNERSHIP

     For the admission to the Partnership of any Partner, the General Partner
shall take all steps necessary and appropriate under the Act to amend the
records of the Partnership and, if necessary, to prepare as soon as practical an
amendment of this Agreement (including an amendment of Exhibit A) and, if
required by law, shall prepare and file an amendment to the Certificate and may
for this purpose exercise the power of attorney granted pursuant to Section 2.4.

                                   ARTICLE 13.
                           DISSOLUTION AND LIQUIDATION

SECTION 13.1 DISSOLUTION

     The Partnership shall not be dissolved by the admission of Substituted
Limited Partners or Additional Limited Partners or by the admission of a
successor General Partner in accordance with the terms of this Agreement. Upon
the withdrawal of the General Partner, any successor General Partner (selected
as described in Section 13.1.B below) shall continue the business of the
Partnership. The Partnership shall dissolve, and its affairs shall be wound up,
upon the first to occur of any of the following (each a "Liquidating Event"):


                                      -49-



     A. the expiration of its term as provided in Section 2.5;

     B. an event of withdrawal of the General Partner, as defined in the Act,
unless, within 90 days after the withdrawal, all of the remaining Partners agree
in writing, in their sole and absolute discretion, to continue the business of
the Partnership and to the appointment, effective as of the date of withdrawal,
of a substitute General Partner;

     C. subject to compliance with Section 11.2 an election to dissolve the
Partnership made by the General Partner, in its sole and absolute discretion;

     D. entry of a decree of judicial dissolution of the Partnership pursuant to
the provisions of the Act;

     E. any sale or other disposition of all or substantially all of the assets
of the Partnership or a related series of transactions that, taken together,
result in the sale or other disposition of all or substantially all of the
assets of the Partnership;

     F. the Incapacity of the General Partner, unless all of the remaining
Partners in their sole and absolute discretion agree in writing to continue the
business of the Partnership and to the appointment, effective as of a date prior
to the date of such Incapacity, of a substitute General Partner;

     G. the redemption or exchange for REIT Shares of all Partnership Interests
(other than those of the General Partner) pursuant to this Agreement; or

     H. a final and non-appealable judgment is entered by a court of competent
jurisdiction ruling that the General Partner is bankrupt or insolvent, or a
final and non-appealable order for relief is entered by a court with appropriate
jurisdiction against the General Partner, in each case under any federal or
state bankruptcy or insolvency laws as now or hereafter in effect, unless prior
to the entry of such order or judgment all of the remaining Partners agree in
writing to continue the business of the Partnership and to the appointment,
effective as of a date prior to the date of such order or judgment, of a
substitute General Partner.

SECTION 13.2 WINDING UP

     A. Upon the occurrence of a Liquidating Event, the Partnership shall
continue solely for the purposes of winding up its affairs in an orderly manner,
liquidating its assets, and satisfying the claims of its creditors and Partners.
No Partner shall take any action that is inconsistent with, or not necessary to
or appropriate for, the winding up of the Partnership's business and affairs.
The General Partner (or, in the event there is no remaining General Partner, any
Person elected by a Majority in Interest of the Limited Partners (the
"Liquidator")) shall be responsible for overseeing the winding up and
dissolution of the Partnership and shall take full account of the Partnership's
liabilities and property and the Partnership property shall be liquidated as
promptly as is consistent with obtaining the fair value thereof, and the
proceeds therefrom (which may, to the extent determined by the General Partner,
include shares of stock in the General Partner) shall be applied and distributed
in the following order:

          (1) First, to the payment and discharge of all of the Partnership's
debts and liabilities to creditors other than the Partners;

          (2) Second, to the payment and discharge of all of the Partnership's
debts and liabilities to the General Partner;

          (3) Third, to the payment and discharge of all of the Partnership's
debts and liabilities to the other Partners; and


                                      -50-



          (4) The balance, if any, to the General Partner, the Special General
Partner and the Limited Partners in proportion to their positive Capital Account
balances, determined after taking into account all Capital Account adjustments
for all prior periods and the Partnership taxable year during which the
liquidation occurs (other than those made as a result of the liquidating
distribution set forth in this Section 13.2.A(4)).

     B. Notwithstanding the provisions of Section 13.2.A which require
liquidation of the assets of the Partnership, but subject to the order of
priorities set forth therein, if prior to or upon dissolution of the Partnership
the Liquidator determines that an immediate sale of part or all of the
Partnership's assets would be impractical or would cause undue loss to the
Partners, the Liquidator may, in its sole and absolute discretion, defer for a
reasonable time the liquidation of any assets except those necessary to satisfy
liabilities of the Partnership (including to those Partners as creditors) and/or
distribute to the Partners, in lieu of cash, as tenants in common and in
accordance with the provisions of Section 13.2.A, undivided interests in such
Partnership assets as the Liquidator deems not suitable for liquidation. Any
such distributions in-kind shall be made only if, in the good faith judgment of
the Liquidator, such distributions in-kind are in the best interest of the
Partners, and shall be subject to such conditions relating to the disposition
and management of such properties as the Liquidator deems reasonable and
equitable and to any agreements governing the operation of such properties at
such time. The Liquidator shall determine the fair market value of any property
distributed in kind using such reasonable method of valuation as it may adopt.

SECTION 13.3 CAPITAL CONTRIBUTION OBLIGATION

     If any Partner has a deficit balance in his, her, or its Capital Account
(after giving effect to all contributions, distributions and allocations for the
taxable years, including the year during which such liquidation occurs), such
Partner shall have no obligation to make any contribution to the capital of the
Partnership with respect to such deficit, and such deficit at any time shall not
be considered a debt owed to the Partnership or to any other Person for any
purpose whatsoever, except to the extent otherwise expressly agreed to by such
Partner and the Partnership.

SECTION 13.4 COMPLIANCE WITH TIMING REQUIREMENTS OF REGULATIONS

     In the discretion of the Liquidator or the General Partner, a pro rata
portion of the distributions that would otherwise be made to the General Partner
and Limited Partners pursuant to this Article 13 may be:

     (1) distributed to a trust established for the benefit of the General
Partner and Limited Partners for the purposes of liquidating Partnership assets,
collecting amounts owed to the Partnership, and paying any contingent or
unforeseen liabilities or obligations of the Partnership or of the General
Partner arising out of or in connection with the Partnership. The assets of any
such trust shall be distributed to the General Partner and Limited Partners from
time to time, in the reasonable discretion of the Liquidator or the General
Partner, in the same proportions and the amount distributed to such trust by the
Partnership would otherwise have been distributed to the General Partner and
Limited Partners pursuant to this Agreement; or

     (2) withheld or escrowed to provide a reasonable reserve for Partnership
liabilities (contingent or otherwise) and to reflect the unrealized portion of
any installment obligations owed to the Partnership, provided, that such
withheld or escrowed amounts shall be distributed to the General Partner and
Limited Partners in the manner and priority set forth in Section 13.2.A as soon
as practicable.

SECTION 13.5 DEEMED DISTRIBUTION AND RECONTRIBUTION

     Notwithstanding any other provision of this Article 13, in the event the
Partnership is liquidated within the meaning of Regulations Section
1.704-1(b)(2)(ii)(g) but no Liquidating Event has occurred, the Partnership's
property shall not be liquidated, the Partnership's liabilities shall not be
paid or discharged, and the Partnership's affairs shall not be wound up.
Instead, the Partnership shall be deemed to have


                                      -51-



contributed all of its assets and liabilities to a new partnership in exchange a
for an interest in the new partnership. Immediately thereafter, the Partnership
shall be deemed to distribute interests in the new partnership to the General
Partner and Limited Partners in proportion to their respective interests in the
Partnership in liquidation of the Partnership.

SECTION 13.6 RIGHTS OF LIMITED PARTNERS

     Except as otherwise provided in this Agreement, each Limited Partner shall
look solely to the assets of the Partnership for the return of his Capital
Contribution and shall have no right or power to demand or receive property from
the General Partner. No Limited Partner shall have priority over any other
Limited Partner as to the return of his Capital Contributions, distributions or
allocations.

SECTION 13.7 NOTICE OF DISSOLUTION

     In the event a Liquidating Event occurs or an event occurs that would, but
for provisions of Section 13.1, result in a dissolution of the Partnership, the
General Partner shall, within 30 days thereafter, provide written notice thereof
to each of the Partners and to all other parties with whom the Partnership
regularly conducts business (as determined in the discretion of the General
Partner) and shall publish notice thereof in a newspaper of general circulation
in each place in which the Partnership regularly conducts business (as
determined in the discretion of the General Partner).

SECTION 13.8 CANCELLATION OF CERTIFICATE OF LIMITED PARTNERSHIP

     Upon the completion of the liquidation of the Partnership cash and property
as provided in Section 13.2, the Partnership shall be terminated and the
Certificate and all qualifications of the Partnership as a foreign limited
partnership in jurisdictions shall be cancelled and such other actions as may be
necessary to terminate the Partnership shall be taken.

SECTION 13.9 REASONABLE TIME FOR WINDING-UP

     A reasonable time shall be allowed for the orderly winding-up of the
business and affairs of the Partnership and the liquidation of its assets
pursuant to Section 13.2, in order to minimize any losses otherwise attendant
upon such winding-up, and the provisions of this Agreement shall remain in
effect between the Partners during the period of liquidation.

SECTION 13.10 WAIVER OF PARTITION

     Each Partner hereby waives any right to partition of the Partnership
property.

                                   ARTICLE 14.
                  AMENDMENT OF PARTNERSHIP AGREEMENT; CONSENTS

SECTION 14.1 AMENDMENTS

     A. The actions requiring consent or approval of the Partners or of the
Limited Partners pursuant to this Agreement, including Section 7.3, or otherwise
pursuant to applicable law, are subject to the procedures in this Article 14.

     B. Amendments to this Agreement requiring the consent or approval of
Limited Partners may be proposed by the General Partner or by Limited Partners
holding twenty-five percent (25%) or more of the Partnership Interests held by
Limited Partners. Following such proposal, the General Partner shall submit any
proposed amendment to the Partners or to the Limited Partners, as applicable.
The General Partner shall seek the written consent of the Limited Partners on
the proposed amendment or shall call a meeting to


                                      -52-



vote thereon and to transact any other business that it may deem appropriate.
For purposes of obtaining a written consent, the General Partner may require a
response within a reasonable specified time, but not less than 15 days, and
failure to respond in such time period shall constitute a consent which is
consistent with the General Partner's recommendation (if so recommended) with
respect to the proposal; provided, that, an action shall become effective at
such time as requisite consents are received even if prior to such specified
time.

SECTION 14.2 ACTION BY THE PARTNERS

     A. Meetings of the Partners may be called by the General Partner and shall
be called upon the receipt by the General Partner of a written request by
Limited Partners holding twenty-five percent (25%) or more of the Partnership
Interests held by Limited Partners. The notice shall state the nature of the
business to be transacted. Notice of any such meeting shall be given to all
Partners not less than seven days nor more than 30 days prior to the date of
such meeting. Partners may vote in person or by proxy at such meeting. Whenever
the vote or Consent of the Limited Partners or of the Partners is permitted or
required under this Agreement, such vote or Consent may be given at a meeting of
Partners or may be given in accordance with the procedure prescribed in
Section 14.1.

     B. Any action required or permitted to be taken at a meeting of the
Partners may be taken without a meeting if a written consent setting forth the
action so taken is signed by the percentage as is expressly required by this
Agreement for the action in question. Such consent may be in one instrument or
in several instruments, and shall have the same force and effect as a vote of
the Percentage Interests of the Partners (expressly required by this Agreement).
Such consent shall be filed with the General Partner. An action so taken shall
be deemed to have been taken at a meeting held on the effective date so
certified.

     C. Each Limited Partner may authorize any Person or Persons to act for him
by proxy on all matters in which a Limited Partner is entitled to participate,
including waiving notice of any meeting, or voting or participating at a
meeting. Every proxy must be signed by the Limited Partner or his
attorney-in-fact. No proxy shall be valid after the expiration of 11 months from
the date thereof unless otherwise provided in the proxy. Every proxy shall be
revocable at the pleasure of the Limited Partner executing it.

     D. Each meeting of Partners shall be conducted by the General Partner or
such other Person as the General Partner may appoint pursuant to such rules for
the conduct of the meeting as the General Partner or such other Person deems
appropriate.

     E. On matters on which Limited Partners are entitled to vote, each Limited
Partner shall have a vote equal to the number of OP Units held.

                                   ARTICLE 15.
                               GENERAL PROVISIONS

SECTION 15.1 ADDRESSES AND NOTICE

     Any notice, demand, request or report required or permitted to be given or
made to a Partner or Assignee under this Agreement shall be in writing and shall
be deemed given or made when delivered in person or when sent by first class
United States mail or by other means of written communication to the Partner or
Assignee at the address set forth in Exhibit A or such other address as the
Partners shall notify the General Partner in writing.

SECTION 15.2 TITLES AND CAPTIONS

     All article or section titles or captions in this Agreement are for
convenience only. They shall not be deemed part of this Agreement and in no way
define, limit, extend or describe the scope or intent of any


                                      -53-



provisions hereof. Except as specifically provided otherwise, references to
"Articles" and "Sections" are to Articles and Sections of this Agreement.

SECTION 15.3 PRONOUNS AND PLURALS

     Whenever the context may require, any pronoun used in this Agreement shall
include the corresponding masculine, feminine or neuter forms, and the singular
form of nouns, pronouns and verbs shall include the plural and vice versa.

SECTION 15.4 FURTHER ACTION

     The parties shall execute and deliver all documents, provide all
information and take or refrain from taking action as may be necessary or
appropriate to achieve the purposes of this Agreement.

SECTION 15.5 BINDING EFFECT

     This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their heirs, executors, administrators, successors, legal
representatives and permitted assigns.

SECTION 15.6 CREDITORS

     Other than as expressly set forth herein with respect to Indemnitees, none
of the provisions of this Agreement shall be for the benefit of, or shall be
enforceable by, any creditor of the Partnership.

SECTION 15.7 WAIVER

     No failure or delay by any party to insist upon the strict performance of
any covenant, duty, agreement or condition of this Agreement or to exercise any
right or remedy consequent upon any breach thereof shall constitute waiver of
any such breach or any other covenant, duty, agreement or condition.

SECTION 15.8 COUNTERPARTS

     This Agreement may be executed in counterparts, all of which together shall
constitute one agreement binding on all the parties hereto, notwithstanding that
all such parties are not signatories to the original or the same counterpart.
Each party shall become bound by this Agreement immediately upon affixing its
signature hereto.

SECTION 15.9 APPLICABLE LAW

     This Agreement shall be construed in accordance with and governed by the
laws of the State of Delaware, without regard to the principles of conflicts of
law.

SECTION 15.10 INVALIDITY OF PROVISIONS

     If any provision of this Agreement is or becomes invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall not be affected thereby.

SECTION 15.11 ENTIRE AGREEMENT

     This Agreement contains the entire understanding and agreement among the
Partners with respect to the subject matter hereof and supersedes any other
prior written or oral understandings or agreements among them with respect
thereto.


                                      -54-



SECTION 15.12 NO RIGHTS AS STOCKHOLDERS

     Nothing contained in this Agreement shall be construed as conferring upon
the holders of OP Units any rights whatsoever as stockholders of the General
Partner, including without limitation any right to receive dividends or other
distributions made to stockholders of the General Partner or to vote or to
consent or to receive notice as stockholders in respect of any meeting of
stockholders for the election of directors of the General Partner or any other
matter.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]


                                      -55-



IN WITNESS WHEREOF, the parties hereto have executed this Agreement of Limited
Partnership as of the date first written above.

General Partner:                        CORPORATE PROPERTY ASSOCIATES 17-
                                        GLOBAL INCORPORATED,
                                        a Maryland company


                                        By: /s/ Mark J. DeCesaris
                                            ------------------------------------
                                            Name: Mark J. DeCesaris
                                            Title: Acting Chief Financial
                                                   Officer


Special General Partner:                W. P. CAREY HOLDINGS, LLC,
                                        a Delaware limited liability company


                                        By: /s/ Thomas E. Zacharias
                                            ------------------------------------
                                            Name: Thomas E. Zacharias
                                            Title: Chief Operating Officer


                                      -56-

EX-10.3

                                                                    EXHIBIT 10.3

             CORPORATE PROPERTY ASSOCIATES 17 - GLOBAL INCORPORATED
                              50 ROCKEFELLER PLAZA
                               NEW YORK, NY 10020

                             SALES AGENCY AGREEMENT

                                November 30, 2007

Carey Financial, LLC
50 Rockefeller Plaza
New York, NY 10020

Ladies and Gentlemen:

Corporate Property Associates 17 - Global Incorporated, a Maryland corporation
(the "Company"), hereby confirms its agreement with you as follows:

     1. Introduction. This Sales Agency Agreement (the "Agreement") sets forth
the understandings and agreements between the Company and you whereby you will
offer and sell on a best efforts basis for the account and risk of the Company,
along with a group of Selected Dealers (as defined in Section 3(c) below) to be
formed with your assistance, up to 250,000,000 shares of common stock, par value
$0.001 per share (each a "Share," and collectively, the "Shares") of the
Company, of which 50,000,000 Shares are being offered pursuant to the Company's
Distribution Reinvestment and Stock Purchase Plan (the "DRIP"), registered on
Form S-11. Shares sold to the public other than through the DRIP shall be sold
at $10 per share (subject to certain volume discounts) and shares sold through
the DRIP shall be sold at $9.50 per share (the "Offering"). The Shares are more
fully described in the Registration Statement referred to below.

     2. Representations and Warranties of the Company.

The Company represents, warrants and agrees that:

          (a) Registration Statement and Prospectus. The Company has filed with
     the Securities and Exchange Commission (the "Commission") a registration
     statement on Form S-11 (File No. 333-140842), for the registration of the
     Shares under the Securities Act of 1933, as amended (the "Securities Act")
     and the regulations thereunder (the "Regulations"). The registration
     statement, as amended, (including financial statements, exhibits and all
     other documents related thereto filed as a part thereof or incorporated
     therein), and any registration statement filed under Rule 462(b) of the
     Securities Act, are herein called the "Registration Statement" and the
     prospectus contained therein is called the "Prospectus," respectively,
     except that if the Registration Statement is amended by a post-effective
     amendment, the term "Registration Statement" shall, from and after the
     declaration of effectiveness of such post-effective amendment, refer to the
     Registration Statement as so amended and the term "Prospectus" shall refer
     to the Prospectus as so amended, and if the Prospectus filed by the Company
     pursuant to Rule 424(b) or 424(c) of the Regulations shall differ from the
     Prospectus on file at the time the Registration Statement or any
     post-effective amendment shall become effective, the term "Prospectus"
     shall refer to the Prospectus filed pursuant to either of such Rules from
     and after the date on which it shall have been filed with the Commission.
     Further, if a separate prospectus is filed and becomes effective with
     respect solely to the



     DRIP (a "DRIP Prospectus"), the term "Prospectus" shall refer to such DRIP
     Prospectus from and after the declaration of effectiveness of such DRIP
     Prospectus.

          (b) Compliance with the Securities Act. The Registration Statement has
     been prepared and filed by the Company and has been declared effective by
     the Commission. Neither the Commission nor any state securities authority
     has issued any order preventing or suspending the use of any Prospectus
     filed with the Registration Statement or any amendments or supplements
     thereto and no proceeding for that purpose has been instituted, or to the
     Company's knowledge, is threatened or contemplated by the Commission or by
     the states securities authorities. At the time the Registration Statement
     became effective (the "Effective Date") and at the time that any
     post-effective amendments thereto or any additional registration statement
     filed under Rule 462(b) of the Securities Act becomes effective, the
     Registration Statement or any amendment thereto (1) complied, or will
     comply, as to form in all material respects with the requirements of the
     Securities Act and the Regulations and (2) did not or will not contain an
     untrue statement of a material fact or omit to state a material fact
     necessary to make the statements therein not misleading. When the
     Prospectus or any amendment or supplement thereto is filed with the
     Commission pursuant to Rule 424(b) or 424(c) of the Regulations and at all
     times subsequent thereto through the date on which the Offering is
     terminated ("Termination Date"), the Prospectus (as amended or as
     supplemented) will comply in all material respects with the requirements of
     the Securities Act and the Regulations, and will not include any untrue
     statement of a material fact or omit to state a material fact required to
     be stated therein or necessary to make the statements therein, in the light
     of the circumstances under which they were made, not misleading.

          (c) The Company. The Company has been duly incorporated and validly
     exists as a corporation in good standing under the laws of the State of
     Maryland with full power and authority to conduct the business in which it
     is engaged in as described in the Prospectus. The Company is duly qualified
     to do business as a foreign corporation and is in good standing in each
     other jurisdiction in which it owns or leases property of a nature, or
     transacts business of a type that would make such qualification necessary
     except where the failure to be so qualified or in good standing could not
     have, individually or in the aggregate, a material adverse effect on the
     financial condition, stockholders' equity, results of operation or business
     of the Company, taken as a whole (a "Material Adverse Effect").

          (d) The Shares. The Shares, when issued, will be duly and validly
     issued, fully paid and non-assessable and will conform in all material
     respects to the description thereof contained in the Prospectus; no holder
     thereof will be subject to personal liability for the obligations of the
     Company solely by reason of being such a holder; such Shares are not
     subject to the preemptive rights of any shareholder of the Company; and all
     corporate action required to be taken for the authorization, issue and sale
     of such Shares has been validly and sufficiently taken.

          (e) Violations. The Company is not in violation of its Articles of
     Incorporation ("Articles") or Bylaws or in default in the performance or
     observance of any material obligation, agreement, covenant or condition
     contained in any contract, indenture, mortgage, loan agreement, note, lease
     or other agreement or instrument to which it is a party or by which it or
     any of its properties is bound.

          (f) Taxes. The Company has filed all federal, state and foreign income
     tax returns which have been required to be filed on or before the due date
     (taking into account all extensions of time to file). The Company has paid
     or provided for the payment of all taxes indicated by said returns and all
     assessments received by the Company to the extent that such taxes or
     assessment have become due, except where the Company is contesting such
     assessments in good faith and except for such taxes and assessments of
     immaterial amounts, the failure of which to pay, would not, individually or
     in the aggregate, reasonably be expected to have a Material Adverse Effect.


                                       2


          (g) Pending Action. Except as disclosed in the Registration Statement
     and the Prospectus, there is no action, suit or proceeding pending or, to
     the best of the knowledge, information and belief of the Company,
     threatened to which the Company is a party, before or by any court or
     governmental agency or body which would reasonably be expected to have a
     Material Adverse Effect.

          (h) Financial Statements. The financial statements of the Company,
     including the notes thereto, filed as part of the Registration Statement
     and those included in the Prospectus present fairly in all material
     respects the financial position of the Company as of the date indicated and
     the results of its operations for the periods specified; said financial
     statements have been prepared in conformity with generally accepted
     accounting principles applied on a consistent basis and comply with the
     requirements of Regulation S-X promulgated by the Commission; and
     PricewaterhouseCoopers LLP, whose report is filed with the Commission as a
     part of the Registration Statement, are independent accountants as required
     by the Securities Act and the Regulations.

          (i) No Subsequent Material Events. Since the respective dates as of
     which information is given in the Registration Statement and the
     Prospectus, except as may otherwise be stated in or contemplated by the
     Registration Statement and the Prospectus, (a) there has not been any
     material adverse change in the condition (financial or otherwise) of the
     Company or in the earnings, affairs or business prospects of the Company,
     whether or not arising in the ordinary course of business, and (b) there
     have not been any material transactions entered into by the Company except
     in the ordinary course of business.

          (j) Investment Company Act. The Company does not intend to conduct its
     business so as to be an "investment company" as that term is defined in the
     Investment Company Act of 1940, as amended and the rules and regulations
     thereunder, and it will exercise reasonable diligence to ensure that it
     does not become an "investment company" within the meaning of the
     Investment Company Act of 1940.

          (k) Authorization of Agreement. This Agreement and the Advisory
     Agreement (the "Advisory Agreement") among the Company, Carey Asset
     Management Corp. (the "Advisor") and CPA(R):17 Limited Partnership have
     been duly and validly authorized, executed and delivered by the Company and
     CPA(R):17 Limited Partnership and constitute the valid agreements of the
     Company and CPA(R):17 Limited Partnership enforceable in accordance with
     their terms. The execution and delivery of this Agreement and the Advisory
     Agreement, the consummation of the transactions herein and therein
     contemplated and the compliance with the terms of this Agreement and the
     Advisory Agreement by the Company and CPA(R):17 Limited Partnership will
     not conflict with or constitute a default under (1) the Articles or bylaws
     of the Company or the Operating Partnership Agreement of CPA(R):17 Limited
     Partnership or (2) any indenture, mortgage, deed of trust, lease or other
     agreement or instrument to which the Company is a party, or (3) any law,
     order, rule or regulation, writ, injunction or decree of any government,
     governmental instrumentality or court, domestic or foreign, having
     jurisdiction over the Company, or any of its property, except in the case
     of clauses (2) and (3), where such conflict, breach, violation or default
     would not reasonably be expected to have individually or in the aggregate,
     a Material Adverse Effect and except to the extent that the enforceability
     of the indemnity and/or contribution provisions contained in Section 8 of
     this Agreement may be limited under applicable securities law; and no
     consent, approval, authorization or order of any court or other
     governmental agency or body has been or is required for the performance of
     this Agreement or the Advisory Agreement by the Company, or CPA(R):17
     Limited Partnership, or for the consummation of the transactions
     contemplated hereby and thereby (except such as have been obtained under
     the Securities Act or as may be required under state securities or "blue
     sky" laws in connection with the distribution of the Shares).


                                       3


          (l) Description of Agreements. The Company is not a party to or bound
     by any contract or other instrument of a character required to be described
     in the Registration Statement or the Prospectus or to be filed as an
     exhibit to the Registration Statement that is not described and filed as
     required.

          (m) Qualification as a Real Estate Investment Trust. The Company
     intends to satisfy the requirements of the Internal Revenue Code of 1986 as
     amended (the "Code") for qualification of the Company as a real estate
     investment trust. Commencing with the taxable year ending December 31,
     2007, the Company has been organized and has operated in conformity with
     the requirements for qualification as a real estate investment trust under
     the Code and its actual method of operation has enabled it and its proposed
     method of operation as described in the Prospectus will enable it to
     continue to meet the requirements for taxation as a real estate investment
     trust under the Code.

     3. Sales of Shares. On the basis of the representations, warranties and
covenants herein contained, but subject to the terms and conditions herein set
forth, the Company hereby appoints you as its sales agent ("Sales Agent") to
solicit purchasers, along with the Selected Dealers, for the Shares during the
period (the "Effective Term") from the Effective Date to the Termination Date,
including the Shares pursuant to the DRIP, each in the manner described in the
Registration Statement. Subject to the performance by the Company of all
obligations to be performed by it hereunder and the completeness and accuracy of
all of its representations and warranties, you agree to use your best efforts as
Sales Agent, promptly following written or telegraphic receipt of notice of the
Effective Date from the Company, to offer and sell such number of Shares as
contemplated by this Agreement at the price stated in the Prospectus.

          (a) Purchase of Shares. The purchase of Shares must be made during the
     offering period described in the Prospectus, or after such offering period
     in the case of purchases made pursuant to the DRIP (each such purchase
     hereinafter defined as an "Order"). Persons desiring to purchase Shares are
     required to (i) deliver to you or the appropriate Selected Dealer a check
     in the amount of $10 per Share purchased (subject to certain volume
     discounts or other discounts as described in the Prospectus) payable to
     Wells Fargo Bank, N. A., until subscription proceeds reach $10 million and
     thereafter to the Bank of the West (each of such Wells Fargo Bank, N.A. and
     the Bank of the West being an "Agent Bank"), or (ii) authorize a debit of
     such amount to the account such purchaser maintains with you, the
     appropriate Selected Dealer. During the Offering and until the first
     valuation of the Company's assets is completed, Shares issued pursuant to
     the DRIP shall be purchased at $9.50 per share. Subsequent to the first
     annual valuation of the Company's assets, the price of shares purchased
     pursuant to the DRIP will be 95% of the then-current net asset value. For
     investors residing in certain states, an order form in the form attached to
     the Prospectus (each an "Order Form") must be completed and submitted to
     the Company. On a daily basis, you will submit all checks received from
     investors and transfer, via Federal Reserve bank wire, the total amount
     debited from investor accounts for the purchase of Shares along with a list
     including the name, address and telephone number of, the social security
     number or taxpayer identification number of, the brokerage account number
     of (if applicable), the number of Shares purchased by, any election to
     participate in the DRIP by, and the total dollar amount of investment by,
     each investor on whose behalf checks are submitted or the wire transfer is
     made. You also will forward all Order Forms to the Company. You shall use
     your best efforts to wire such funds or transmit checks to the applicable
     Agent Bank not later than noon of the next business day after receipt by
     you from your customer of each Order. You will advise the applicable Agent
     Bank whether the funds you are submitting are attributable to individual
     retirement accounts, Keogh plans, or any other employee benefit plan
     subject to Title I of the Employee Retirement Income Security Act of 1974
     or from some other type of investor.

     All Orders solicited by you will be strictly subject to review and
     acceptance by the Company and the Company reserves the right in its
     absolute discretion to reject any Order or to accept or reject Orders in
     the order of their receipt by the Company or otherwise. Within 30 days of
     receipt of an Order, the


                                       4


     Company must accept or reject such Order. If the Company elects to reject
     such Order, within 10 business days after such rejection, it will notify
     the purchaser of such fact and cause the return of such purchaser's funds
     submitted with such application and any interest earned thereon. If you
     receive no notice of rejection within the foregoing time limits or if funds
     submitted by the purchaser are released from escrow to the Company within
     the foregoing time limits, the Order shall be deemed accepted. You agree to
     make every reasonable effort to determine that the purchase of Shares is a
     suitable and appropriate investment for each potential purchaser of Shares
     based on information provided by such purchaser regarding such purchaser's
     financial situation and investment objectives. You agree to maintain copies
     of the Orders received from investors.

          (b) Closing Dates and Delivery of Shares. In no event shall a sale of
     Shares to an investor be completed until at least five business days after
     the date the investor receives a copy of the Prospectus. On the date Shares
     are first issued to shareholders (such date being herein referred to as the
     "Initial Closing Date"), the applicable Agent Bank will at such time and
     place as instructed by you and the Company (which instruction shall be
     subject to the satisfaction on such date of the conditions contained
     herein), deliver to the Company or its designee immediately available funds
     in an amount equal to the escrow funds maintained by the Company and on
     deposit in the escrow account of the applicable Agent Bank prior to the
     date designated by the Company. If, after the Initial Closing Date,
     additional sales of Shares are made, on each such date (each such date
     being referred to as an "Additional Closing Date") and at each such time
     and place as instructed by you and the Company (which instruction shall be
     subject to the satisfaction on each such date of the conditions contained
     herein), the applicable Agent Bank shall be required to deliver to the
     Company or its designee immediately available funds in an amount equal to
     the escrow funds on deposit in the escrow account of the applicable Agent
     Bank prior to the date specified by the Company. The Initial Closing Date
     and each Additional Closing Date are each herein referred to as a "Closing
     Date." Closing dates for purchases made pursuant to the DRIP will be as set
     forth in the DRIP.

          (c) Selected Dealers. The Shares offered and sold under this
     Agreement, other than sales made by the Company directly to its officers
     and directors, shall be offered and sold only by you as Sales Agent and by
     a selling group of brokers or dealers (the "Selected Dealers"), all of whom
     must be members in good standing of the Financial Industry Regulatory
     Authority (the "FINRA"), who execute Selected Dealer Agreements with you
     substantially in the form attached hereto as Exhibit A, all of whom are
     acceptable to the Company and you (which acceptance shall not be
     unreasonably withheld by you). You will assist the Company in forming the
     selling group of Selected Dealers. No firm shall be invited to join the
     selling group of Selected Dealers if it is (i) currently subject to any
     suspension or expulsion pursuant to the rules and regulations of the
     Commission, the state securities commissions of any of the fifty states,
     the New York Stock Exchange, Inc. or the American Stock Exchange, Inc. as
     those rules and regulations relate to broker-dealers, or the rules and
     regulations of the FINRA or (ii) a "discount broker" as that term is
     commonly understood in the brokerage industry. The Company and the Advisor
     or an affiliate thereof agree to participate in your marketing efforts to
     the extent that you may reasonably request and, without limiting the
     generality of the foregoing, agree to visit the offices of Selected Dealers
     as you may reasonably designate.

          (d) Compensation. In consideration for your execution of this
     Agreement, and for the performance of your obligations hereunder, the
     Company agrees to pay or cause to be paid to you a selling commission (the
     "Selling Commission") of six and one-half percent ($0.65) of the price of
     each Share (except for Shares sold pursuant to the DRIP, as to which no
     Selling Commissions shall be paid) sold by you or by a Selected Dealer;
     provided, however, that your Selling Commission shall be reduced with
     respect to volume sales of Shares to single purchasers (as defined in the
     Prospectus). In the case of such volume sales to single purchasers, on
     orders of $250,000 or more your Selling Commission shall be reduced by the
     amount of the Share purchase price discount. In the case of such volume
     sales to single


                                       5



     purchasers, your Selling Commission will be reduced for each incremental
     share purchase in the total volume ranges set forth in the table below.
     Such reduced share price will not affect the amount received by the Company
     for investment. The following table sets forth the reduced Share purchase
     price and Selling Commission payable to you:



                              PURCHASE PRICE PER SHARE FOR    SELLING COMMISSION PER SHARE
VOLUME DISCOUNT RANGE FOR A    INCREMENTAL SHARE IN VOLUME    ON TOTAL SALE FOR INCREMENTAL
     SINGLE PURCHASER                DISCOUNT RANGE          SHARE IN VOLUME DISCOUNT RANGE
- ---------------------------   ----------------------------   ------------------------------
                                                       
$ 2000 - $250,000                          $10.00                         $0.65
$250,001 - $500,000                        $ 9.85                         $0.50
$500,001 - $750,000                        $ 9.70                         $0.35
$750,001 - $1,000,000                      $ 9.60                         $0.25
$1,000,001- $5,000,000                     $ 9.50                         $0.15


     As an example, a single purchaser would receive 50,380.7107 Shares rather
than 50,000 Shares for his/her or its investment of $500,000 and the Selling
Commission would be $28,940. On the first $250,000 of the investment there would
be no discount and the purchaser would receive 25,000 Shares at $10 per share.
On the remaining $250,000, the per share price would be $9.85 and the purchaser
would receive 25,380.7107 Shares.

     Selling Commissions for purchases of $5,000,000 or more are negotiable but
in no event will the proceeds to the Company be less than $9.35 per Share.
Selling Commissions paid will in all cases be the same for the same level of
sales.

     The Company will pay to you for reallowance to Selected Dealers only, the
amount of any due diligence expense reimbursement paid to the Selected Dealers
which you have agreed to pay in the amount of up to one-half percent of the
total proceeds received by the Company from Shares sold by each Selected Dealer
to which you have agreed to make such reimbursement.

     From your total Selling Commissions, you agree to reallow to each Selected
Dealer with whom you have entered into a Selected Dealer Agreement the full
$0.65 Selling Commission per Share for Shares sold by the Company pursuant to
Orders solicited by such Selected Dealer and up to the full amount of the $0.20
per Share Selected Dealer Fee (as defined in the Selected Dealer Agreement) paid
to you by the Company with respect to Shares solicited by the Selected Dealer.
The Company will pay to you a Wholesaling Fee of $0.15 per Share sold. This fee
is intended to cover your wholesaling expenses. No Selling Commissions, Selected
Dealer Fees or Wholesaling Fees will be paid in connection with purchases of
Shares made through the DRIP.

     No payment of Selling Commissions will be made by the Company with respect
to Orders (or portions thereof), which are rejected by the Company. In addition,
we will not pay you a Selected Dealer Fee if the aggregate underwriting
compensation to be paid to us, you and the other Selected Dealers in connection
with the Offering and sale of the Shares (including such Selected Dealer Fee)
exceed the limitations prescribed by the FINRA. Selling Commissions, Selected
Dealer Fees and Wholesaling Fees will be paid within five business days
following any Closing Date with respect to the Shares sold to purchasers whose
Shares are issued on such Closing Date. Selling Commissions, Selected Dealer
Fees and Wholesaling Fees will be payable only with respect to transactions
lawful in the jurisdictions where they occur, (Purchases of Shares by W. P.
Carey & Co. LLC, its Affiliates or any Selected Dealer or any of their employees
shall be net of Selling Commissions).


                                       6



     The Company represents that neither it nor any of its affiliates have
offered or sold any Shares pursuant to this Offering, other than directly to the
Company's officers and directors and to registered investment advisers, and
agrees that, through the date on which the Offering is terminated (the
"Termination Date"), the Company will not offer or sell any Shares otherwise
than through you as herein provided, except to its officers and directors and to
registered investment advisers.

          (e) Finders Fee. Neither the Company nor any Selected Dealer
     participating in the Offering shall, directly or indirectly, pay or award
     any finder's fees, commissions or other compensation to any person engaged
     by a potential investor for investment advice as an inducement to such
     advisor to advise the purchase of Shares; provided, however, that normal
     Selling Commissions payable to a registered broker-dealer or other properly
     licensed person for selling Shares shall not be prohibited hereby.

          (f) Wholesaling Activities. You hereby agree to provide the following
     additional services for the Company:

               (i) reviewing sales literature prepared by the Company to be used
          in the offer and sale of the Shares for compliance with the Securities
          Act and the Regulations thereunder, the Conduct Rules of the FINRA and
          the "blue sky" laws of any jurisdiction in which such material is used
          ("Blue Sky Law"). The sales literature may include, but not be limited
          to, a slide presentation, a property acquisition report, a brochure
          and seminar invitations for presentation and distribution to the
          public and an audio program, a video program and a brochure for
          presentation and distribution to broker-dealers;

               (ii) assisting broker-dealers participating in the Offering by
          coordinating broker-dealer seminars, informational meetings,
          distributing brochures and other sales literature designed for
          broker-dealers and providing information and answering any questions
          with regard to the Offering; and

               (iii) assisting the Company in enlisting broker-dealers to
          participate in the Offering as Selected Dealers.

     4. Covenants. The Company covenants to you and each Selected Dealer that it
will:

          (a) Commission Orders. Use its best efforts to cause the Registration
     Statement and any subsequent amendments thereto, to become effective as
     promptly as possible, and will promptly notify you and confirm the notice
     in writing if requested, (i) when the Registration Statement and any
     post-effective amendment thereto become effective, (ii) of the issuance by
     the Commission or any state securities authority of any jurisdiction of any
     stop order or of the initiation, or the threatening, of any proceedings for
     that purpose or of the suspension of the qualification of the Shares for
     offering or sale in any jurisdiction or of the institution or threatening
     of any proceedings for any of such purposes, (iii) of the receipt of any
     comments from the Commission with respect to the Registration Statement,
     and (iv) of any request by the Commission for any amendment to the
     Registration Statement as filed or any amendment or supplement to the
     Prospectus or for additional information relating thereto. The Company and
     you will make every reasonable effort to prevent the issuance by the
     Commission of a stop order or a suspension order and if the Commission
     shall enter a stop order or suspension order at any time, the Company will
     make every reasonable effort to obtain the lifting of such order at the
     earliest possible moment.

          (b) Registration Statement. Deliver to you and Selected Dealers
     without charge the Registration Statement and each amendment thereto, and
     as soon as the Registration Statement or any amendment or supplement
     thereto become effective, such number of copies of the Prospectus (as
     amended or supplemented), the Registration Statement and supplements and
     amendments thereto, if any (without exhibits), as you may reasonably
     request. The Company hereby consents to the use of the


                                       7


     Prospectus or any amendment or supplement thereto by you and Selected
     Dealers both in connection with the Offering and for such period of time
     thereafter as the Prospectus is required to be delivered in connection
     therewith.

          (c) "Blue Sky" Qualifications. Endeavor in good faith, in cooperation
     with you, Selected Dealers and counsel to Selected Dealers, at or prior to
     the time the Registration Statement becomes effective, to seek the approval
     of the Offering by the FINRA, and to qualify the Shares for offering and
     sale under the securities laws of all 50 states and the District of
     Columbia, except in those jurisdictions you may reasonably designate,
     provided, however, the Company shall not be obligated to subject itself to
     taxation as a party doing business in any such jurisdiction. In each
     jurisdiction where such qualification shall be effected, the Company will,
     unless you agree that such action is not at the time necessary or
     advisable, file and make such statements or reports as are or may
     reasonably be required by the laws of such jurisdiction.

          (d) Amendments and Supplements. If during the time when a Prospectus
     is required to be delivered under the Securities Act, any event relating to
     the Company shall occur as a result of which it is necessary, in the
     opinion of the Company's counsel, to amend or supplement the Prospectus in
     order to make the Prospectus not misleading in light of the circumstances
     existing at the time it is delivered to an investor, the Company will
     forthwith prepare and furnish without expense to you and the Selected
     Dealers, a reasonable number of copies of an amendment or amendments of, or
     a supplement or supplements to, the Registration Statement or the
     Prospectus which will amend or supplement the Registration Statement or
     Prospectus so that as amended or supplemented it will not contain an untrue
     statement of a material fact or omit to state a material fact required to
     be stated therein or necessary in order to make the statements therein, in
     the light of the circumstances under which they were made, not misleading.
     During the time when a Prospectus is required to be delivered under the
     Securities Act, the Company shall comply in all material respects with all
     requirements imposed upon it by the Securities Act, as from time to time in
     force, so far as necessary to permit the continuance of sales of the Shares
     in accordance with the provisions hereof and the Prospectus.

          (e) Copies of Reports. During the Offering, you will be furnished with
     the following:

               (i) as soon as practicable after they have been sent by the
          Company to the shareholders or to any class of security holders of the
          Company or filed with the Commission, copies of each annual and
          interim financial and each other report provided to such shareholder;

               (ii) as soon as practicable, copies of every press release issued
          by the Company and every material news item and article in respect of
          the Company or its affairs released by the Company; and

               (iii) additional documents and information with respect to the
          Company and its affairs as you may from time to time reasonably
          request.

          (f) Sales Material. Will deliver to you from time to time, all
     advertising and supplemental sales material (whether designated solely for
     broker-dealer use or otherwise) proposed to be used or delivered in
     connection with the Offering, prior to the use or delivery to third parties
     of such material, and will not so use or deliver, in connection with the
     Offering, any such material to which you or your counsel shall reasonably
     object or disapprove within seven days of delivery of such material to you
     or which shall be reasonably disapproved by your counsel within such
     seven-day period.


                                       8


          (g) Use of Proceeds. Apply the proceeds from the sale of Shares as set
     forth in the section of the Prospectus entitled "Estimated Use of Proceeds"
     and operate the business of the Company in accordance with the descriptions
     of its business set forth in the Prospectus.

          (h) Prospectus Delivery. In case you or any Selected Dealer is
     required to deliver a Prospectus in connection with sales of any of the
     Shares at any time nine months or more after the Effective Date, upon your
     or such Selected Dealer's request, the Company will, at its expense,
     prepare and deliver to you or such Selected Dealer as many copies as you
     may request of an amended or supplemented Prospectus complying with Section
     10(a)(3) of the Securities Act.

          (i) Financial Statements. Make generally available to its security
     holders as soon as practicable, but not later than 60 days after the close
     of the period covered thereby, an earnings statement of the Company (in
     form complying with the provisions of Rule 158 under the Securities Act)
     covering a period of 12 months beginning after the Effective Date but not
     later than the first day of the Company's fiscal quarter next following the
     Effective Date.

          (j) Compliance with Exchange Act. Comply with the requirements of the
     Securities Exchange Act of 1934 ("Exchange Act") relating to the Company's
     obligation to file periodic reports including annual reports on Form 10-K,
     quarterly reports on Form 10-Q and current reports on Form 8-K.

     5. Covenants of the Sales Agent. You covenant and agree with the Company as
follows;

          (a) Compliance with Laws. In connection with the offer and sale of
     Shares, you shall comply with any applicable requirements of the Securities
     Act, the Exchange Act and the applicable state securities or "blue sky"
     laws, and the rules and regulations thereunder.

          (b) Accuracy of Information. No information supplied by you for use in
     the Registration Statement will contain any untrue statements of a material
     fact or omit to state any material fact necessary to make such information
     not misleading.

          (c) No Additional Information. You will not give any information or
     make any representation in connection with the offering of the Shares other
     than that contained in the Prospectus.

          (d) Sale of Shares. You shall act as Sales Agent and solicit, directly
     or through Selected Dealers, purchasers of the Shares only in the
     jurisdictions in which you have been advised by the Company that such
     solicitations can be made and in which you or the soliciting Selected
     Dealer, as the case may be, are qualified to so act.

          (f) Licensing. Any person employed or retained by either the Company
     or you to provide sales support or wholesaling services in support of you
     or your clients shall be licensed in accordance with all applicable laws
     and will comply with all applicable federal and state securities laws and
     regulations.

     6. Payment of Expenses.

          (a) Expenses. Whether or not the transactions contemplated in this
     Agreement are consummated or if this Agreement is terminated, the Company
     will pay, in addition to the compensation described in Section 3(d) (which
     you may retain up to the point of termination unless this agreement is
     terminated without any Shares being sold, in which case no such
     compensation shall be paid), all fees and expenses incurred in connection
     with the formation, qualification and registration of the Company and in
     marketing, distributing and processing the Shares under applicable Federal
     and state law, and any other


                                       9


     fees and expenses actually incurred and directly related to the offering
     and sale of the Shares and your other obligations under this Agreement,
     including such fees and expenses as: (i) the preparing, printing, filing
     and delivering of the Registration Statement (as originally filed and all
     amendments thereto) and of any preliminary prospectus and of the Prospectus
     and any amendments thereof or supplements thereto and the preparing and
     printing of the Selected Dealer Agreements, this Agreement and Order Forms,
     including the cost of all copies thereof and any financial statements or
     exhibits relating to the foregoing supplied to you or the Selected Dealers
     in quantities reasonably requested by you; (ii) the preparing and printing
     of the solicitation material and related documents and the filing and/or
     recording of such certified certificates or other documents necessary to
     comply with the laws of the State of Maryland for the formation of a
     corporation and thereafter for the continued good standing of a Company;
     (iii) the issuance and delivery of the Shares, including any transfer or
     other taxes payable thereon; (iv) any escrow arrangements in connection
     with the transactions described herein, including any compensation or
     reimbursement to an escrow agent for its services as such; (v) the
     qualification or registration of the Shares under state securities or "blue
     sky" laws; (vi) the filing fees payable to the Commission and to the FINRA;
     (vii) the preparation and printing of advertising material in connection
     with and relating to the Offering, including the cost of all sales
     literature and investor and broker-dealer sales and information meetings;
     (viii) the cost and expenses of counsel and accountants of the Company; and
     (ix) any other expenses of issuance and distribution of the Shares. The
     Company shall also reimburse directly all other entities for the expenses
     of the type described in clauses (i) through (ix) of the preceding sentence
     incurred directly by those entities at your request.

          (b) Sales Incentive Programs. Subject to the satisfactory completion
     of any regulatory reviews and examinations which may be required, the prior
     review and approval and the rules of the FINRA (including Rule 2710
     (c)(6)(B)(xiii)) and approval by the Company or the Advisor, the Company,
     the Advisor and Affiliates of the Advisor may establish sales incentive
     programs for your associated persons or the associated persons of Selected
     Dealers only. Sales incentives will be deemed to be additional
     compensation. The aggregate value of incentives paid directly to an
     individual associated person during the Offering will not exceed $100 in
     any given year.

          (c) Limitation. Notwithstanding the foregoing, the total compensation
     paid to the Sales Agent and Selected Dealers from any source in connection
     with the Offering pursuant to Section 3(d) hereof and this Section 6 shall
     not exceed the limitations prescribed by the FINRA. The Company and you
     agree to monitor the payment of all fees and expense reimbursements to
     assure that the FINRA limitations are not exceeded.

     7. Conditions of Your Obligations. Your obligations hereunder shall be
subject to the continued accuracy throughout the Effective Term of the
representations, warranties and agreements of the Company, to the performance by
the Company of its obligations hereunder and to the following terms and
conditions:

          (a) Effectiveness of Registration Statement. The Registration
     Statement shall have initially become effective not later than 5:30 p.m.,
     Eastern time, on the date of this Agreement, at any time during the term of
     this Agreement, no stop order shall have been issued or proceedings
     therefor initiated or threatened by the Commission; and all requests for
     additional information on the part of the Commission and state securities
     administrators shall have been complied with to the reasonable satisfaction
     of your counsel and no stop order or similar order shall have been issued
     or proceedings therefor initiated or threatened by any state securities
     authority in any jurisdiction in which the Company intends to offer Shares.

          (b) Stop Orders. On the Effective Date and during the Effective Term
     no order suspending the sale of the Shares in any jurisdiction (except the
     Designated Jurisdictions) nor any stop order issued


                                       10



     by the Commission shall have been issued, and on the Effective Date and
     during the Effective Term no proceedings relating to any such suspension or
     stop orders shall have been instituted, or to the knowledge of the Company,
     shall be contemplated.

          (c) Information Concerning the Advisor. On the Effective Date, you
     shall receive a letter dated the Effective Date from the Advisor,
     confirming that: (1) the Advisory Agreement has been duly and validly
     authorized, executed and delivered by the Advisor and constitutes a valid
     agreement of the Advisor enforceable in accordance with its terms; (2) the
     execution and delivery of the Advisory Agreement, the consummation of the
     transactions therein contemplated and compliance with the terms of the
     Advisory Agreement by the Advisor will not conflict with or constitute a
     default under its articles of incorporation or bylaws or any indenture,
     mortgage, deed of trust, lease or other agreement or instrument to which
     the Advisor is a party, or any law, order, rule or regulation, writ,
     injunction or decree of any government, governmental instrumentality or
     court, domestic or foreign, having jurisdiction over the Advisor, or any of
     its property; (3) no consent, approval, authorization or order of any court
     or other governmental agency or body has been or is required for the
     performance of the Advisory Agreement by the Advisor, or for the
     consummation of the transactions contemplated thereby; and (4) the Advisor
     is a corporation duly formed, validly existing and in good standing under
     the laws of the State of Delaware and is duly qualified to do business as a
     foreign corporation in each other jurisdiction in which the nature of its
     business would make such qualification necessary.

     If any of the conditions specified in this Section 7 shall not have been
     fulfilled when and as required by this Agreement, this Agreement and all
     your obligations hereunder may be canceled by you by notifying the Company
     of such cancellation in writing or by telecopy at any time, and any such
     cancellation or termination shall be without liability of any party to any
     other party except as otherwise provided in Sections 3(d), 6, 8, 9 and 10
     hereof.

     All certificates, letters and other documents referred to in this Section 7
     will be in compliance with the provisions hereof only if they are
     reasonably satisfactory in form and substance to you and your counsel. The
     Company will furnish you with conformed copies of such certificates,
     letters and other documents, as you shall reasonably request.

     8. Indemnification.

          (a) Indemnification by the Company. Subject to the conditions set
     forth below and those included in the Articles and Bylaws, the Company
     agrees to indemnify and hold harmless you, each Selected Dealer and each
     person, if any, who controls you or any such Selected Dealer within the
     meaning of Section 15 of the Securities Act, from and against any and all
     loss, liability, claim, damage and expense whatsoever (including but not
     limited to any and all expenses whatsoever reasonably incurred in
     investigating, preparing for, defending against or settling any litigation,
     commenced or threatened, or any claim whatsoever) arising out of or based
     upon: (1) any untrue or alleged untrue statement of a material fact
     contained (i) in the Registration Statement at the time it became effective
     or in the Prospectus (as from time to time amended or supplemented) or any
     related preliminary prospectus; or (ii) in any application or other
     document (in this Section 8 collectively called "application") executed by
     the Company or based upon information furnished by the Company and filed in
     any jurisdiction in order to qualify the Shares under the securities laws
     thereof or (2) the omission or alleged omission from the Registration
     Statement (or any amendment thereto) at the time it became effective or
     from the Prospectus, of a material fact required to be stated therein or
     necessary to make the statements therein in light of the circumstances
     under which they were made not misleading; provided however that the
     Company shall not be liable in any such case to the extent any such
     statement or omission was made in reliance upon and in conformity with
     written information furnished to the Company by you expressly for use in
     the Registration Statement or related preliminary prospectus or Prospectus
     or any amendment or supplement


                                       11


     thereof or in any of such applications or in any such sales as the case may
     be. Notwithstanding the foregoing, the Company shall not indemnify the
     Sales Agent for any losses, liabilities or expenses arising from or out of
     an alleged violation of federal or state securities laws unless: there has
     been a successful adjudication on the merits of each count involving
     alleged securities law violations as to the particular indemnitee, (ii)
     such claims have been dismissed with prejudice on the merits by a court of
     competent jurisdiction as to the particular indemnitee or (iii) a court of
     competent jurisdiction approves a settlement of the claims against a
     particular indemnitee and finds that indemnification of the settlement and
     the related costs should be made, and the court considering the request for
     indemnification has been advised of the position of the Commission and of
     the published position of any state securities regulatory authority in
     which securities of the Company were offered or sold as to indemnification
     for violations of securities laws.

          (b) Indemnification by You. Subject to the conditions set forth below,
     you agree to indemnify and hold harmless the Company, each of its
     directors, those of its officers who have signed the Registration Statement
     and each other person, if any, who controls the Company within the meaning
     of Section 15 of the Securities Act to the same extent as the foregoing
     indemnity from the Company but only with respect to an untrue statement or
     alleged untrue statement of a material fact or omission or alleged omission
     to state a material fact in the Registration Statement (as from time to
     time amended or supplemented) or Prospectus, or any related preliminary
     prospectus, or any application made in reliance upon or, in conformity
     with, written information furnished by you expressly for use in such
     Registration Statement or Prospectus or any amendment or supplement
     thereto, or in any related preliminary prospectus or in any of such
     applications.

          (c) Procedure for Making Claims. Each indemnified party shall give
     prompt notice to each indemnifying party of any claim or action (including
     any governmental investigation) commenced against it in respect of which
     indemnity may be sought hereunder, but failure to so notify any
     indemnifying party shall not relieve it from any liability, except to the
     extent it has been materially prejudiced by such failure, and in any event
     shall not relieve it from any liability that it may have otherwise than on
     account of this indemnity agreement. The indemnifying party, jointly with
     any other indemnifying parties receiving such notice, shall assume the
     defense of such action with counsel chosen by it and reasonably
     satisfactory to the indemnified parties defendant in such action, unless
     such indemnified parties reasonably object to such assumption on the ground
     that there may be legal defenses available to them which are different from
     or in addition to those available to such indemnifying party. Any
     indemnified party shall have the right to employ a separate counsel in any
     such action and to participate in the defense thereof but the reasonable
     fees and expenses of such counsel shall be borne by such party unless such
     party has objected in accordance with the preceding sentence, in which
     event such fees and expenses shall be borne by the indemnifying parties.
     Except as set forth in the preceding sentence, if an indemnifying party
     assumes the defense of such action, the indemnifying party shall not be
     liable for any fees and expenses of separate counsel for the indemnified
     parties incurred thereafter in connection with such action. In no event
     shall the indemnifying parties be liable for the reasonable fees and
     expenses of more than one counsel for all indemnified parties in connection
     with any one action or separate but similar or related actions in the same
     jurisdiction arising out of the same general allegations or circumstances.

     The indemnity agreements contained in this Section 8 and the warranties and
     representations contained in this Agreement shall remain in full force and
     effect regardless of any investigation made by or on behalf of the
     indemnified party and shall survive any termination of this Agreement. An
     indemnifying party shall not be liable to an indemnified party on account
     of any settlement, compromise or consent to the entry of judgment of any
     claim or action effected without the consent of such indemnifying party.
     The Company agrees promptly to notify you of the commencement of any
     litigation or proceedings against the Company in connection with the issue
     and sale of the Shares or in connection with the Registration Statement or
     Prospectus.


                                       12


          (d) Contribution. Subject to the limitations set forth in Section 8(a)
     hereof and in order to provide for just and equitable contribution where
     the indemnification provided for in this Section 8 is unavailable to or
     insufficient to hold harmless an indemnified party under subsection (a) or
     (b) above in respect of any losses, liabilities, claims, damages or
     expenses (or actions in respect thereof) referred to therein, except by
     reason of the terms thereof, the Company on the one hand and you on the
     other shall contribute to the amount paid or payable by such indemnified
     party as a result of such losses, liabilities, claims, damages or expenses
     (or actions in respect thereof) in such proportion as is appropriate to
     reflect the relative benefits received by the Company on the one hand and
     you on the other from the Offering based on the public offering price of
     the Shares sold and the Selling Commissions received by you with respect to
     such Shares sold. If, however, the allocation provided by the immediately
     preceding sentence is not permitted by applicable law, then each applicable
     indemnifying party, in lieu of indemnifying such indemnified party, shall
     contribute to the amount paid or payable by such indemnified party in such
     proportion as is appropriate to reflect not only such relative benefits
     referred to above but also the relative fault of the Company on the one
     hand and you on the other in connection with the statements or omissions
     which resulted in such losses, liabilities, claims, damages or expenses (or
     actions in respect thereof), as well as any other relevant equitable
     considerations. The relative benefits received by the Company on the one
     hand and you on the other shall be deemed to be in the same proportion as
     (i) the aggregate net compensation retained by the Company and its
     affiliates for the purchase of Shares and (ii) the total proceeds from the
     Offering (net of Selling Commissions, Selected Dealer Fees and Wholesaling
     Fees but before deducting expenses) received by the Company bear to the
     total Selling Commissions received by you. The relative fault shall be
     determined by reference to, among other things, whether the untrue or
     alleged untrue statement of a material fact or the omission to state a
     material fact relates to information supplied by the Company on the one
     hand or you on the other. The Company agrees with you that it would not be
     just and equitable if contribution pursuant to this subsection (d) were
     determined by pro rata allocation, or by any other method of allocation
     which does not take account of the equitable considerations referred to
     above in this subsection (d). The amount paid or payable by an indemnified
     party as a result of the losses, liabilities, claims, damages or expenses
     (or action in respect thereof) referred to above in this subsection (d)
     shall be deemed to include any legal or other expenses reasonably incurred
     by such indemnified party in connection with investigating or defending any
     such action or claim. Notwithstanding the provisions of this subsection
     (d), you shall not be required to contribute any amount in excess of the
     amount by which the total price of the Shares sold by you to the public
     exceeds the amount of any damages which you have otherwise been required to
     pay by reason of such untrue or alleged untrue statement or omission or
     alleged omission. No person guilty of fraudulent misrepresentation (within
     the meaning of Section 11(f) of the Securities Act or Section 10(b) of the
     Securities Exchange Act of 1934, as amended) shall be entitled to
     contribution from any person who was not guilty of such fraudulent
     misrepresentation. For purposes of this Section, any person that controls
     you within the meaning of Section 15 of the Securities Act shall have the
     same right to contribution as you, and each person who controls the Company
     within the meaning of Section 15 of the Securities Act shall have the same
     right to contribution as the Company.

     9. Representations and Agreements to Survive. All representations,
warranties and agreements contained in this Agreement or in certificates shall
remain operative and in full force and effect regardless of any investigation
made by any party, and shall survive the Termination Date.

     10. Effective Date, Term and Termination of this Agreement.

          (a) This Agreement shall become effective as of the date it is
     executed by all parties hereto. You or the Company may elect to terminate
     this Agreement prior to the time the Registration Statement is declared
     effective by the Commission without liability of any party to any other
     party, except as provided in Section 10(e) hereof.


                                       13


          (b) You shall have the right to terminate this Agreement at any time
     during the Effective Term without liability of any party to any other party
     except as provided in Section 10(e) hereof if: (i) any representations or
     warranties hereunder shall be found to have been incorrect; or (ii) the
     Company shall fail, refuse or be unable to perform any condition of its
     obligations hereunder, or (iii) the Prospectus shall have been amended or
     supplemented despite your objection to such amendment or supplement as
     provided in subsection (a) of Section 2 hereof, or (iv) all trading on the
     New York Stock Exchange or the American Stock Exchange shall have been
     suspended, or minimum or maximum prices for trading generally shall have
     been fixed, or maximum ranges for prices for all securities shall have been
     required, on the New York Stock Exchange or the American Stock Exchange by
     such exchanges or by order of the Commission or any other governmental
     authority having jurisdiction; or (v) the United States shall have become
     involved in a war or major hostilities or a material escalation of
     hostilities or acts of terrorism involving the United States or other
     national or international calamity or crisis (other than hostilities
     including Iraq and Afghanistan); or (vi) a banking moratorium shall have
     been declared by a state or federal authority or person; or (vii) the
     Company shall have sustained a material or substantial loss by fire, flood,
     accident, hurricane, earthquake, theft, sabotage or other calamity or
     malicious act which, whether or not said loss shall have been insured, will
     in your good faith opinion make it inadvisable to proceed with the offering
     and sale of the Shares; or (viii) there shall have been, subsequent to the
     dates information is given in the Registration Statement and the
     Prospectus, such change in the business, properties, affairs, condition
     (financial or otherwise) or prospects of the Company whether or not in the
     ordinary course of business or in the condition of securities markets
     generally as in your good faith judgment would make it inadvisable to
     proceed with the offering and sale of the Shares, or which would materially
     adversely affect the operations of the Company.

          (c) If this Agreement shall be terminated for reason of any failure on
     the part of the Company to perform any undertaking or satisfy any condition
     of this Agreement to be performed or satisfied by them pursuant to Section
     7 hereof, you may elect to terminate this Agreement without liability of
     any party to any other party except as provided in Section 10(e) hereof.

          (d) The Company shall have the right to terminate this Agreement
     without cause on 60 days' notice in writing to you without penalty, subject
     to liability as provided in Section 10(e) hereof.

          (e) In the event this Agreement is terminated by any party pursuant to
     Sections 10(a), 10(b), 10(c) or 10(d) hereof, the Company shall pay all
     expenses of the Offering as required by Section 6 hereof and no party will
     have any additional liability to any other party except for any liability
     which may exist under Section 8 hereof; and provided further, that if you
     terminate your participation in the Offering in other than good faith, the
     Company shall not be responsible for the expenses described in clause (vii)
     of subsection (a) of Section 6 hereof other than expenses of counsel to the
     Selected Dealers. In no event will the Company be liable to reimburse you
     for expenses other than your actual and reasonable out-of-pocket expenses.

          (f) If you elect to terminate this Agreement as provided in this
     Section 10, you shall notify the Company promptly by telephone or telegram
     with confirmation by letter. If the Company elects to terminate this
     Agreement as provided in this Section 10, the Company shall notify you
     promptly by telephone or telegram with confirmation by letter.

     11. Notices.

          (a) All communications hereunder, except as herein otherwise
     specifically provided, shall be in writing and if sent to you shall be
     mailed, or personally delivered, to you at 50 Rockefeller Plaza, New York,
     New York 10020, and if sent to the Company shall be mailed, or personally
     delivered, to the


                                       14


     Company at 50 Rockefeller Plaza, New York, New York 10020, Attention: Mr.
     Wm. Polk Carey and Mr. Gordon F. DuGan.

          (b) Notice shall be deemed to be given by you to the Company or by the
     Company to you when it is mailed or personally delivered as provided in
     subsection (a) of this Section 11.

     12. Parties. This Agreement shall inure solely to the benefit of, and shall
be binding upon you, the Company, and the controlling persons, directors and
officers referred to in Section 8 hereof, and their respective successors, legal
representatives and assigns, and no other person shall have or be construed to
have any legal or equitable right, remedy or claim under or in respect of or by
virtue of this Agreement or any provision herein contained, except that the
Selected Dealers shall have the rights granted to them pursuant to Section 8
hereof. Notwithstanding the foregoing, this Agreement may not be assigned
without the consent of the parties hereto.

     13. Construction. This Agreement shall be construed in accordance with the
laws of the State of New York applicable to agreements to be made and performed
entirely within such state.

     14. Finders' Fees. You shall have no liability for any finders' fees owed
in connection with the transactions contemplated by this Agreement.

     15. Severability. Any provision of this Agreement, which is invalid or
unenforceable in any jurisdiction, shall be ineffective to the extent of such
invalidity or unenforceability without invalidating or rendering unenforceable
the remaining provisions hereof, and any such invalidity or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such provisions in
any other jurisdiction.

     16. Additional Offerings. The terms of this Agreement may be extended to
cover additional offerings of shares of the Company by the execution by the
parties hereto of an addendum identifying the shares and registration statement
relating to such additional offering. Upon execution of such addendum, the terms
"Shares", "Offering", "Registration Statement" and "Prospectus" set forth herein
shall be deemed to be amended as set forth in such addendum.


                                       15



     If the foregoing correctly sets forth the understanding between you and the
Company, please so indicate in the space provided on the attached page for that
purpose, whereupon this letter shall constitute a binding agreement between us.

                                         CORPORATE PROPERTY ASSOCIATES 17 -
                                         GLOBAL INCORPORATED


                                         By: /s/ Jan F. Karst
                                             -----------------------------------
                                             Jan F. Karst
                                         Its: President


                                         Accepted as of the Date first above
                                         Written:

                                         CAREY FINANCIAL, LLC


                                         By: /s/ Louisa H. Quarto
                                             ----------------------------------
                                             Louisa H. Quarto
                                         Its: Executive Director and Chief
                                              Management Officer


                                       16



                                  EXHIBIT INDEX

Exhibit A - Selected Dealer Agreement

EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO RULE 13a-14(a)

I, Gordon F. DuGan, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Corporate Property Associates 17 – Global Incorporated;

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)) for the registrant and we 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)	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
c)	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 controls 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 controls over financial reporting.

Date 12/14/2007

/s/ Gordon F. DuGan  

Gordon F. DuGan 

Chief Executive Officer 

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO RULE 13a-14(a)

I, Mark J. DeCesaris, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Corporate Property Associates 17 – Global Incorporated;

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)) for the registrant and we 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)	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
c)	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 controls 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 controls over financial reporting.

Date 12/14/2007

/s/ Mark J. DeCesaris  

Mark J. DeCesaris 

acting Chief Financial Officer 

EX-32

Exhibit 32

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Corporate Property Associates 17 – Global Incorporated on Form 10-Q for the period ended September 30, 2007 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Gordon F. DuGan, Chief Executive Officer of Corporate Property Associates 17 – Global Incorporated, certify, to the best of my knowledge and belief, 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 result of operations of Corporate Property Associates 17 – Global Incorporated.

Date 12/14/2007

/s/ Gordon F. DuGan  

Gordon F. DuGan 

Chief Executive Officer 

In connection with the Quarterly Report of Corporate Property Associates 17 – Global Incorporated on Form 10-Q for the period ended September 30, 2007 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Mark J. DeCesaris, acting Chief Financial Officer of Corporate Property Associates 17 – Global Incorporated, certify, to the best of my knowledge and belief, 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 result of operations of Corporate Property Associates 17 – Global Incorporated.

Date 12/14/2007

/s/ Mark J. DeCesaris  

Mark J. DeCesaris 

acting Chief Financial Officer 

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 Corporate Property Associates 17 – Global Incorporated and will be retained by Corporate Property Associates 17 – Global Incorporated and furnished to the Securities and Exchange Commission or its staff upon request.