10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)
þ	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 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: 0-50261*

G REIT Liquidating Trust

(Exact name of registrant as specified in its charter)

Maryland (State or other jurisdiction of incorporation or organization)	26-6199755 (I.R.S. Employer Identification No.)
1551 N. Tustin Avenue, Suite 200 Santa Ana, California 92705 (Address of principal executive offices)	92705 (zip code)

Registrant’s telephone number, including area code: (714) 667-8252

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Name of Each Exchange on Which Registered
None	None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock*

(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes o     No þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.*

Yes o     No o

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

Yes o     No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.*

o

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

Large accelerated filer o Accelerated filer o Non-accelerated filer þ Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

  Yes o     No þ

As of June 30, 2007, the aggregate market value of common stock held by non-affiliates of G REIT, Inc. was approximately $43,920,000 (based on the price for which each share was sold).* No established market exists for the registrant’s shares of common stock.

As of March 24, 2008, there were 43,920,000 units of beneficial interest in G REIT Liquidating Trust outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

None

*  G REIT Liquidating Trust is the transferee of the assets and liabilities of G REIT, Inc., and files reports under the Commission file number for G REIT, Inc. G REIT, Inc. filed a Form 15 on January 28, 2008, indicating its notice of termination of registration and filing requirements.

TABLE OF CONTENTS

		Page
PART I
Item 1.	Business		3
Item 1A.	Risk Factors		10
Item 1B.	Unresolved Staff Comments		24
Item 2.	Properties		25
Item 3.	Legal Proceedings		29
Item 4.	Submission of Matters to a Vote of Security Holders		29
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		30
Item 6.	Selected Financial Data		31
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		33
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk		58
Item 8.	Financial Statements and Supplementary Data		59
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure		59
Item 9A(T).	Controls and Procedures		59
Item 9B.	Other Information		60
PART III
Item 10.	Directors, Executive Officers and Corporate Governance		61
Item 11.	Executive Compensation		66
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		67
Item 13.	Certain Relationships and Related Transactions, and Director Independence		67
Item 14.	Principal Accounting Fees and Services		70
PART IV
Item 15.	Exhibits, Financial Statement Schedules		71
SIGNATURES			112
EXHIBIT 10.21
EXHIBIT 10.22
EXHIBIT 10.23
EXHIBIT 10.24
EXHIBIT 10.25
EXHIBIT 10.26
EXHIBIT 21.1
EXHIBIT 31.1
EXHIBIT 32.1

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PART I

Item 1.      Business.

The use of the words “we,” “us” or “our” refers to G REIT Liquidating Trust and its subsidiaries, except where the context otherwise requires.

Overview

We were organized on January 22, 2008, as a liquidating trust pursuant to a plan of liquidation of G REIT, Inc., or G REIT. On January 28, 2008, in accordance with the Agreement and Declaration of Trust, or the Liquidating Trust Agreement, by and between G REIT and each of its directors, Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace and Gary T. Wescombe, or our Trustees, G REIT transferred its then remaining assets and liabilities to us. Upon the transfer of the assets and liabilities to us, each stockholder of G REIT as of January 22, 2008, or the Record Date, automatically became the holder of one unit of beneficial interest, or a unit, in G REIT Liquidating Trust for each share of G REIT common stock then currently held of record by such stockholder. Our purpose is to wind up the affairs of G REIT by liquidating its remaining assets, distributing the proceeds from the liquidation of the remaining assets to the holders of units, each a beneficiary and, collectively, the beneficiaries, and paying all liabilities, costs and expenses of G REIT and G REIT Liquidating Trust.

G REIT was incorporated on December 18, 2001, under the laws of the Commonwealth of Virginia and qualified and elected to be taxed as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended, or the Code, for federal income tax purposes. On September 27, 2004, G REIT was reincorporated in the State of Maryland in accordance with the approval of its stockholders at its 2004 Annual Meeting of Stockholders. G REIT was originally formed to acquire, manage and invest in office, industrial and service real estate properties which have a government-tenant orientation. G REIT was formed with the intent to be listed on a national stock exchange, quoted on a quotation system of a national securities association or merged with an entity whose shares are listed or quoted. In 2005, as a result of (i) then current market conditions, (ii) the increasing costs of corporate compliance (including, without limitation, all federal, state and local regulatory requirements applicable to us, including the Sarbanes-Oxley Act of 2002, as amended, or the Sarbanes-Oxley Act), and (iii) the possible need to reduce monthly distributions, the G REIT board of directors determined that a liquidation would provide G REIT’s stockholders with a greater return on their investment over a reasonable period of time than through implementation of other alternatives considered.

As described below, on February 27, 2006, G REIT’s stockholders approved a plan of liquidation and the eventual dissolution of G REIT. Accordingly, G REIT has been engaged in an ongoing liquidation of its assets. As of December 31, 2007, G REIT owned interests in five properties aggregating a total gross leaseable area, or GLA, of 1.5 million square feet, comprised of interests in four consolidated office properties, or the consolidated properties, and one unconsolidated office property, or the unconsolidated property. As of December 31, 2007, approximately 57.2% of the total GLA of G REIT’s consolidated properties was leased and governmental related entities occupied approximately 18.1% of the total GLA. On January 28, 2008, G REIT transferred its interests in the five properties to us pursuant to the Liquidating Trust Agreement. On March 12, 2008, we sold one of the consolidated properties, Pax River Office Park located in Lexington Park, Maryland, which comprised 17.5% of G REIT’s GLA as of December 31, 2007. Following the sale of this property, we held interests in three remaining consolidated properties and the unconsolidated property, which we refer to collectively as the “remaining assets.” For more information relating to the consolidated and unconsolidated properties, see Item 2. Properties.

Liquidation of G REIT, Inc.

On December 19, 2005, the board of directors of G REIT approved a plan of liquidation which was thereafter approved by stockholders of G REIT at the Special Meeting of Stockholders held on February 27, 2006. The G REIT plan of liquidation, or the plan of liquidation, contemplates the orderly sale of all of G REIT’s assets, the payment of its liabilities, the winding up of operations and the dissolution of G REIT.

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G REIT engaged Robert A. Stanger & Co., Inc., or Stanger, to perform financial advisory services in connection with the plan of liquidation, including rendering opinions as to whether G REIT’s net real estate liquidation value range estimate and estimated per share distribution range were reasonable. In December 2005, Stanger opined that G REIT’s net real estate liquidation value range estimate and estimated per share distribution range were reasonable from a financial point of view. Actual values realized for assets and settlement of liabilities may differ materially from the amounts estimated by G REIT or reflected in Stanger’s opinion.

The plan of liquidation granted G REIT’s board of directors the power to sell any and all of its assets without further approval by its stockholders and provided that liquidating distributions be made to its stockholders as determined by G REIT’s board of directors. The plan of liquidation also provided for the transfer of G REIT’s remaining assets and liabilities to a liquidating trust if G REIT was unable to sell its assets and pay its liabilities within 24 months of its stockholders’ approval of the plan of liquidation (which was February 27, 2008). On October 29, 2007, G REIT’s board of directors approved the transfer of G REIT’s assets and liabilities to G REIT Liquidating Trust.

On January 22, 2008, G REIT and our Trustees, Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace and Gary T. Wescombe, the independent directors of G REIT, entered into the Liquidating Trust Agreement in connection with our formation. Gary T. Wescombe, the chairman of the G REIT board of directors was appointed the chairman of the Trustees. On January 28, 2008, G REIT transferred its remaining assets to, and its remaining liabilities were assumed by, us in accordance with the plan of liquidation and the Liquidating Trust Agreement. In connection with the transfer of assets to, and assumption of liabilities by, us the stock transfer books of G REIT were closed as of the close of business on the Record Date and each share of G REIT’s common stock outstanding on the Record Date was converted automatically into a unit of beneficial interest. Following the conversion of shares to units, all outstanding shares of G REIT’s common stock were deemed cancelled. The rights of beneficiaries in their beneficial interests are not represented by any form of certificate or other instrument. Stockholders of G REIT on the Record Date were not required to take any action to receive their units. On the date of the conversion, the economic value of each unit of beneficial interest was equivalent to the economic value of a share of G REIT’s common stock. On January 28, 2008, G REIT filed a Form 15 with the Securities and Exchange Commission, or the SEC, to terminate the registration of G REIT’s common stock under the Securities Exchange Act of 1934, as amended, or the Exchange Act, and G REIT announced that it would cease filing reports under the Exchange Act. Our Trustees will issue to beneficiaries and file with the SEC annual reports on Form 10-K and current reports on Form 8-K upon the occurrence of a material event relating to us.

Immediately before the transfer of G REIT’s assets and liabilities to us, G REIT, L.P., the operating partnership of G REIT, or the Operating Partnership, redeemed the special limited partnership interest held by Grubb & Ellis Realty Investors, LLC, or Grubb & Ellis Realty Investors (formerly known as Triple Net Properties, LLC), or our advisor, in exchange for the right to receive 15.0% of certain distributions made by G REIT and G REIT Liquidating Trust after G REIT’s stockholders, who are now our beneficiaries, have received certain returns on their invested capital. As a result of such redemption, G REIT owned 100.0% of the outstanding partnership interests in the Operating Partnership. The Operating Partnership was dissolved in connection with the dissolution of G REIT, and all of its assets and liabilities were distributed to G REIT immediately before the transfer to us.

Our existence will terminate upon the earliest of (i) the distribution of all of our remaining assets in accordance with the terms of Liquidating Trust Agreement, or (ii) the expiration of a period of three years from the date assets were first transferred to us, or January 28, 2011. Our existence may, however, be extended beyond the three-year term if our Trustees then determine that an extension is reasonably necessary to fulfill our purpose and, prior to such extension, our Trustees have requested and received certain no-action assurances from the SEC. Although we can provide no assurances, we currently expect to sell our remaining assets by September 30, 2008 and anticipate completing the plan of liquidation by December 31, 2008.

In accordance with the plan of liquidation, we continue to actively manage our property portfolio to seek to achieve higher occupancy rates, control operating expenses and maximize income from ancillary operations

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and services. We continually evaluate our existing portfolio and adjust our net real estate liquidation value accordingly. It is our policy that when we execute a purchase and sale agreement or become aware of market conditions or other circumstances that indicate that the present value of our properties materially differs from our expected net sales price, we will adjust our liquidation value accordingly. Under the adoption of the plan of liquidation, we will not acquire any new properties, and are focused on liquidating our remaining assets.

Our Advisor

Our advisor manages our day-to-day business affairs and assets and carries out the directives of our Trustees, pursuant to an advisory agreement, or the Advisory Agreement. Our advisor is a Virginia limited liability company that was formed in April of 1998 to advise syndicated limited partnerships, limited liability companies, and other entities, including many of our affiliates, regarding the acquisition, management and disposition of real estate assets. Our advisor advises us and certain of our affiliates with respect to the management and potential disposition of our remaining assets.

Liquidation Progress during 2008, 2007 and 2006

Year to Date 2008

•   On March 12, 2008, we sold Pax River Office Park located in Lexington Park, Maryland, or the Pax River Office Park property, to an unaffiliated third party for a sales price of $14,475,000.

Year Ended December 31, 2007

•   G REIT paid the following liquidating distributions in 2007:

•   in April 2007 and November 2007, G REIT paid special liquidating distributions of approximately $131,761,000, or $3.00 per share, and $43,920,000, or $1.00 per share, respectively; and

•   G REIT paid cumulative monthly liquidating distributions from January 2007 through December 2007 totaling $13,231,000, or $0.30 per share.

•   G REIT sold the following ten properties in 2007:

•   on January 11, 2007, G REIT sold Two Corporate Plaza located in Clear Lake, Texas, or the Two Corporate Plaza property, to an unaffiliated third party for a sales price of $18,000,000;

•   on March 22, 2007, G REIT sold One World Trade Center located in Long Beach, California, or the One World Trade Center property, to an unaffiliated third party for a sales price of $148,900,000;

•   on March 30, 2007, G REIT sold One Financial Plaza, located in St. Louis, Missouri, or the One Financial Plaza property, of which G REIT owned a 77.63% interest, to an unaffiliated third party for a sales price of $47,000,000;

•   on June 29, 2007, G REIT sold 824 Market Street, located in Wilmington, Delaware, or the 824 Market Street property, to tenant in common, or TIC, investors managed by our advisor for a sales price of $37,000,000;

•   on June 29, 2007, G REIT sold North Belt Corporate Center, located in Houston, Texas, or the North Belt Corporate Center property, to an unaffiliated third party for a sales price of $17,750,000;

•   on July 23, 2007, G REIT sold Opus Plaza at Ken Caryl located in Littleton, Colorado, or the Opus Plaza at Ken Caryl property, to an unaffiliated third party for a sales price of $10,400,000;

•   on August 2, 2007, G REIT sold Madrona Buildings located in Torrance, California, or the Madrona Buildings property, to an unaffiliated third party for a sales price of $52,500,000;

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•   on September 14, 2007, G REIT sold Eaton Freeway Industrial Park located in Phoenix, Arizona, or the Eaton Freeway Industrial Park property, to an unaffiliated third party for a sales price of $7,825,000;

•   on September 14, 2007, G REIT sold North Pointe Corporate Center located in Sacramento, California, or the North Pointe Corporate Center property, to an unaffiliated third party for a sales price of $23,750,000; and

•   on November 6, 2007, G REIT sold Bay View Plaza located in Alameda, California, or the Bay View Plaza property, to an unaffiliated third party for a sales price of $9,700,000.

Year Ended December 31, 2006

•   G REIT paid the following liquidating distributions in 2006:

•   in October 2006, G REIT paid a special liquidating distribution of approximately $171,289,000, or $3.90 per share; and

•   G REIT paid cumulative monthly liquidating distributions from May 2006 through December 2006 totaling $21,493,000, or $0.49 per share.

•   G REIT sold the following ten properties in 2006:

•   on July 18, 2006, G REIT sold 600 B St. (Comerica) located in San Diego, California, or the 600 B St. property, to an unaffiliated third party for a sales price of $95,500,000;

•   on September 14, 2006, G REIT sold Hawthorne Plaza located in San Francisco, California, or the Hawthorne Plaza property, to an unaffiliated third party for a sales price of $125,000,000;

•   on September 29, 2006, G REIT sold AmberOaks Corporate Center located in Austin, Texas, or the AmberOaks Corporate Center property, to an unaffiliated third party for a sales price of $46,837,000;

•   on October 6, 2006, G REIT sold Brunswig Square located in Los Angeles, California, or the Brunswig Square property, to an unaffiliated third party for a sales price of $26,900,000;

•   on October 17, 2006 G REIT sold Centerpointe Corporate Park located in Kent, Washington, or the Centerpointe Corporate Park property, to an unaffiliated third party for a sales price of $77,525,000;

•   on November 14, 2006, G REIT sold 5508 Highway 290 located in Austin, Texas, or the 5508 Highway 290 property, to an unaffiliated third party for a sales price of $10,200,000;

•   on November 15, 2006, G REIT sold Department of Children and Family Campus located in Plantation, Florida, or the Department of Children and Family Campus property, to TIC investors managed by our advisor for a sales price of $13,000,000;

•   on November 22, 2006, G REIT sold Public Ledger Building located in Philadelphia, Pennsylvania, or the Public Ledger Building property, to an unaffiliated third party for a sales price of $43,000,000;

•   on December 15, 2006, G REIT sold Atrium Building located in Lincoln, Nebraska, or the Atrium Building property, to an unaffiliated third party for a sales price of $5,805,000; and

•   on December 29, 2006, G REIT sold Gemini Plaza located in Houston, Texas, or the Gemini Plaza property, to an unaffiliated third party for a sales price of $17,000,000.

Although we can provide no assurances, we currently expect to sell our remaining assets by September 30, 2008 and anticipate completing our liquidation by December 31, 2008. As a result of the approval of the plan of liquidation by G REIT’s stockholders, the liquidation basis of accounting was adopted as of December 31, 2005 and for all periods subsequent to December 31, 2005. For a more detailed discussion of the plan of

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liquidation, including the risk factors and certain other uncertainties associated therewith, please read our definitive proxy statement filed with the SEC on January 13, 2006.

Current Objectives and Policies

In accordance with the plan of liquidation, our primary objective is to obtain the highest possible sales value for our remaining assets, while maintaining current value and income from these investments. Due to the adoption of the plan of liquidation, we will not acquire any new properties, and we are focused on liquidating our remaining assets. However, we cannot assure our beneficiaries that we will achieve these objectives or the capital of our beneficiaries will not decrease.

In accordance with the plan of liquidation, we currently consider various factors when evaluating potential property dispositions. These factors include, without limitation, (i) the ability to sell our remaining assets at the highest possible price in order to maximize the return to our beneficiaries; and (ii) the ability of buyers to finance the acquisition of our assets. Until we successfully sell our remaining assets, our primary operating strategy is to enhance the performance and value of the properties through strategies designed to address the needs of current and prospective tenants. These strategies include:

•   managing costs and seeking to minimize operating expenses by centralizing management, leasing, marketing, financing, accounting, renovation and data processing activities;

•   improving rental income and cash flow by aggressively marketing rentable space and raising rents when feasible;

•   emphasizing regular maintenance and periodic renovation to meet the needs of tenants and to maximize long-term returns; and

•   refinancing our properties when favorable financing terms are available to increase the cash flow.

As of March 24, 2008 we owned three consolidated properties and a 30.0% interest in one unconsolidated property. Two of these consolidated properties were located in Texas and one was located in California.

Our interest in one unconsolidated property is located in Illinois with an aggregate GLA of 519,000 square feet. Most of our leases are “gross” leases with terms of five years or more, usually providing for a base minimum annual rent with periodic increases. Our gross leases typically require that we pay all or a majority of the operating expenses, including real estate taxes, special assessments, utilities, insurance and building repairs related to the property. In addition, most of our government tenant leases may permit tenants to terminate under certain circumstances, including, for example, in the event of their failure to obtain financial appropriations or in the event of the termination or non-renewal of a material contract.

Financing Policies

As of December 31, 2007, one of the consolidated properties was subject to existing mortgage with an aggregate principal amount outstanding of $24,000,000 consisting of $18,840,000 on a liquidation basis of variable rate debt at a weighted-average interest rate of 8.13% per annum. We may utilize certain derivative financial instruments at times to limit interest rate risk. The fixed interest rates and the interest rate swap, cap and collar agreements on the variable interest rates limit the risk of fluctuating interest rates. The derivatives we enter into, and the only derivative transactions approved by our Trustees, are those which are used only for hedging purposes rather than speculation. If an anticipated hedged transaction does not occur, any positive or negative value of the derivative will be recognized immediately in net income. We did not have any derivative financial instruments as of December 31, 2007.

Tax Status

G REIT was organized and operated so as to qualify for taxation as a REIT under the Code. Its qualification and taxation as a REIT depended on its ability to meet, through actual annual operating results, asset diversification, distribution levels and diversity in stock ownership, numerous requirements established

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under highly technical and complex Code provisions subject to interpretation. Because G REIT qualified for taxation as a REIT, G REIT was not be subject to federal income tax to the extent G REIT distributed at least 100.0% of its REIT taxable income to its stockholders. As a liquidating trust, we will generally not be subject to federal income taxes.

Tax Treatment

We will issue an annual information statement to our beneficiaries with tax information for their tax returns for the period from January 28, 2008 through December 31, 2008. Beneficiaries are urged to consult with their own tax advisors as to their own filing requirements and the appropriate tax reporting of this information on their returns. Beneficiaries will receive a final Form 1099-DV from G REIT for the period beginning January 1, 2008 and ending January 28, 2008.

Reports to Beneficiaries

Our Trustees are expected to issue annual reports to the beneficiaries showing our assets and liabilities at the end of each fiscal year and our receipts and disbursements for the period. The annual reports will also describe changes in our assets during the reporting period and the actions taken by our Trustees during the period. Our Trustees will file with the SEC (i) an annual report on Form 10-K and (ii) a current report on Form 8-K upon the occurrence of a material event relating to us. We make our filings available at www.gbe-realtyinvestors.com as soon as reasonably practicable after such materials are electronically filed with the SEC. They are also available for printing by any beneficiary upon request.

Meetings of Beneficiaries; Removal of Trustees

Generally, there will be no meetings of the beneficiaries. However, our Trustees may at any time call a meeting of the beneficiaries to be held at such time and at such place as our Trustees shall determine. In addition, holders of at least 25% of the units held by all beneficiaries may require our Trustees to call a meeting of the beneficiaries. Any or all Trustees may be removed at any time, with cause, by beneficiaries holding aggregate units of at least a majority of the total units held by all beneficiaries. Any or all Trustees may be removed at any time, without cause, by beneficiaries holding aggregate units of at least two-thirds of the total units held by all beneficiaries.

Distribution Policy

In order to qualify as a REIT for federal income tax purposes, G REIT was required to distribute at least 90.0% of its taxable income (excluding capital gains) to its stockholders. Subsequent to March 31, 2006, all distributions have been paid in the form of liquidating distributions to G REIT’s stockholders and recorded when approved. Since the approval of the plan of liquidation, G REIT paid three special liquidating distributions as follows: (i) in October 2006, G REIT paid $171,289,000, or $3.90 per share; (ii) in April 2007, G REIT paid $131,761,000, or $3.00 per share; and (iii) in November 2007, G REIT paid $43,920,000, or $1.00 per share, for a total of $7.90 per share being paid to date in special liquidating distributions. In addition, G REIT paid cumulative monthly liquidating distributions beginning with the April 2006 distribution, paid in May 2006, through and including the December 2007 distribution, paid in January 2008, totaling $34,724,000, or $0.79 per share, to its stockholders. The monthly liquidating distributions to stockholders were based on an annualized rate of 7.50% on: (i) a $10.00 per share value from May 2006 through October 2006; (ii) a remaining $6.10 per share value from November 2006 to April 2007; (iii) a remaining $3.10 per share value from May 2007 to November 2007; and (iv) a remaining $2.10 per share value beginning in December 2007. While the plan of liquidation provided that monthly distributions would terminate following the payment of liquidating distributions totaling $150,000,000, G REIT’s board of directors decided to continue to pay monthly distributions at an annualized rate of 7.50% on the share value remaining of $2.10. Our Trustees will continue to evaluate the payment of monthly liquidating distributions on an on-going basis as more properties are sold and additional special liquidating distributions are paid to beneficiaries. Every payment of liquidating distributions will be subject to the availability of cash and the sole discretion of our Trustees.

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Competition

As we complete the plan of liquidation, we will be in competition with other sellers of similar properties, or interests in properties, as our remaining assets, to locate suitable purchasers, which may result in us receiving lower net proceeds than our estimated liquidation proceeds. Additionally, until we sell our remaining assets, we will compete with a considerable number of other real estate companies seeking to lease office space, some of which have greater marketing and financial resources than we do. Principal factors of competition in our business are the quality of properties (including the design and condition of improvements), leasing terms (including rent and other charges and allowances for tenant improvements), attractiveness and convenience of location, the quality and breadth of tenant services provided, and the reputation as an owner and operator of quality office properties in the relevant market. Our ability to compete also depends on, among other factors, trends in the national and local economies, financial condition and operating results of current and prospective tenants, availability and cost of capital, including capital raised by incurring debt, construction and renovation costs, taxes, governmental regulations, legislation and population trends.

As of March 24, 2008, we hold interests in properties located in California, Texas and Illinois. Other entities managed by our advisor also own property interests in some of the same regions in which we own property interests and such properties are managed by Triple Net Properties Realty, Inc., or Realty, an affiliate of our advisor. Our properties may face competition in these geographic regions from such other properties owned, operated or managed by our advisor or Realty. Our advisor and Realty have interests that may vary from those we may have in such geographic markets.

Government Regulations

Our properties are subject to various federal, state and local laws, ordinances and regulations, including, among other things, zoning regulations, land use controls, environmental controls relating to air and water quality, noise pollution and indirect environmental impacts such as increased motor vehicle activity. Additionally, under the Americans with Disabilities Act of 1990, or ADA, all public accommodations must meet federal requirements for access and use by disabled persons. Although we believe that we are in substantial compliance with present requirements of the ADA, our properties have not been audited, nor have investigations of our properties been conducted to determine compliance. We may incur additional costs in connection with the ADA or other federal, state and local laws which may require us to make modifications to our properties. We cannot predict the cost of compliance with the ADA or other legislation.

Environmental

As an owner of real estate, we are subject to various environmental laws of federal, state and local governments. Such environmental laws and regulations may hold us liable for the costs of removal or remediation of certain hazardous or toxic substances which may be on our properties. These laws could impose liability without regard to whether we are responsible for the presence or release of the hazardous materials. Compliance with existing laws has not had a material adverse effect on our financial condition or results of operations, and management does not believe it will have such an impact in the future. However, we cannot predict the impact of unforeseen environmental contingencies or new or changed laws or regulations on properties in which we hold an interest.

Employees

We have no employees. Substantially all of our work is performed by employees of our advisor and its affiliates.

Financial Information about Industry Segments

We internally evaluate all of our properties as one industry segment, and, accordingly, we do not report segment information.

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Item 1A.      Risk Factors.

Risks Associated with Our Liquidation

We may delay or reduce our estimated liquidating distributions to our beneficiaries.

As of March 24, 2008, we estimate that our net proceeds from liquidation will be approximately $478,327,000 (of which approximately $381,694,000 has already been paid to G REIT stockholders prior to the transfer of G REIT’s assets and liabilities to us) and we expect that our beneficiaries will receive approximately $10.89 per unit in liquidating distributions (of which $8.69 per share has already been paid to G REIT stockholders prior to the transfer of G REIT’s assets and liabilities to us), which we anticipate paying by December 31, 2008. However, our expectations about the amount of liquidating distributions to our beneficiaries that we will make and when we will make them are based on many estimates and assumptions, one or more of which may prove to be incorrect. As a result, the actual amount of liquidating distributions we pay to our beneficiaries may be more or less than we currently estimate. In addition, the liquidating distributions to our beneficiaries may be paid later than we predict.

If we are unable to find buyers for our remaining assets at our expected sales prices, our liquidating distributions may be delayed or reduced.

As of March 24, 2008, none of our remaining assets are subject to binding sale agreements providing for their sale. In calculating our estimated range of liquidating distributions to our beneficiaries, we assumed that we would be able to find buyers for our properties at amounts based on our estimated range of market values for each property. However, we may have overestimated the sales prices that we will ultimately be able to obtain for our remaining assets. For example, in order to find buyers in a timely manner, we may be required to lower our asking price below the low end of our current estimate of a property’s market value. If we are not able to find buyers for our remaining assets in a timely manner or if we have overestimated the sales prices we will receive, our liquidating payments to our beneficiaries would be delayed or reduced. Furthermore, the projected liquidating distribution to our beneficiaries is based upon the market value for each property, but real estate market values are constantly changing and fluctuate with changes in interest rates, supply and demand dynamics, occupancy percentages, lease rates, the availability of suitable buyers, the perceived quality and dependability of income flows from tenancies and a number of other factors, both local and national. The net liquidation proceeds from each property may also be affected by the terms of prepayment or assumption costs associated with debt encumbering each property. In addition, minority ownership matters, transactional fees and expenses, environmental contamination at our properties or unknown liabilities, if any, may adversely impact the net liquidation proceeds from our remaining assets.

Decreases in property values may reduce the amount that we receive upon a sale of our remaining assets.

The underlying value of our properties may be reduced by a number of factors that are beyond our control, including, without limitation, the following:

•   adverse changes in economic conditions;

•   the financial performance of our tenants, and the ability of our tenants to satisfy their obligations under their leases;

•   potential major repairs which are not presently contemplated;

•   terminations and renewals of leases by our tenants;

•   changes in interest rates and the availability of financing;

•   competition; and

•   changes in real estate tax rates and other operating expenses.

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Any reduction in the value of our properties would make it more difficult for us to sell our remaining assets for the amounts that we have estimated. Reductions in the amounts that we receive when we sell our remaining assets could decrease or delay the payment of liquidating distributions to beneficiaries.

If we are unable to maintain the occupancy rates of currently leased space and lease currently available space, if tenants default under their leases or other obligations to us during the liquidation process or if our cash flow during the liquidation is otherwise less than we expect, our liquidating distributions to our beneficiaries may be delayed or reduced.

In calculating our estimated liquidating distributions to our beneficiaries, we assumed that we would maintain the occupancy rates of currently-leased space, that we would be able to rent certain currently available space at market rents and that we would not experience any significant tenant defaults during the liquidation process that were not subsequently cured. Negative trends in one or more of these factors during the liquidation process may adversely affect the resale value of the properties, which would reduce our liquidating distributions to our beneficiaries. To the extent that we receive less income than we expect during the liquidation process, our liquidating distributions to our beneficiaries will be reduced. We may also decide in the event of a tenant default to restructure the lease, which could require us to substantially reduce the rent payable to us under the lease, or make other modifications that are unfavorable to us which could decrease or delay the payment of liquidating distributions to our beneficiaries.

If our liquidation costs or unpaid liabilities are greater than we expect, our liquidating distributions to our beneficiaries may be delayed or reduced.

Before making the final liquidating distribution to our beneficiaries, we will need to pay or arrange for the payment of all of our transaction costs in the liquidation, and all other costs and all valid claims of our creditors. Our Trustees may also decide to acquire one or more insurance policies covering unknown or contingent claims against us, for which we would pay a premium which has not yet been determined. Our Trustees may also decide to establish a reserve fund to pay these contingent claims. The amounts of transaction costs in the liquidation are not yet final, so we have used estimates of these costs in calculating the amounts of our projected liquidating distributions to our beneficiaries. To the extent that we have underestimated these costs in calculating our projections, our actual net liquidation value may be lower than our estimated range. In addition, if the claims of our creditors are greater than we have anticipated or we decide to acquire one or more insurance policies covering unknown or contingent claims against us, our liquidating distributions to our beneficiaries may be delayed or reduced. Further, if a reserve fund is established, payment of liquidating distributions to our beneficiaries may be delayed or reduced.

If any of the parties to our future sale agreements default thereunder, or if these sales do not otherwise close, our liquidating distributions to our beneficiaries may be delayed or reduced.

We will seek to enter into binding sale agreements for all of our remaining assets. The consummation of the potential sales for which we will enter into sale agreements in the future will be subject to satisfaction of closing conditions. If any of the transactions contemplated by these future sale agreements do not close because of a buyer default, failure of a closing condition or for any other reason, we will need to locate a new buyer for the asset which we may be unable to do promptly or at prices or on terms that are as favorable as the original sale agreement. We will also incur additional costs involved in locating a new buyer and negotiating a new sale agreement for this asset. These additional costs are not included in our projections. In the event that we incur these additional costs, our liquidating payments to our beneficiaries would be delayed or reduced.

The pending SEC investigation of our advisor could result in lawsuits or other actions against us or our affiliates.

On September 16, 2004, our advisor learned that the SEC Los Angeles Enforcement Division, or the SEC Staff, was conducting an investigation referred to as “In the matter of Triple Net Properties, LLC.” The SEC has requested information from our advisor relating to disclosure in public and private securities offerings

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sponsored by our advisor and its affiliates, or the Triple Net securities offerings (including offerings by G REIT). The SEC has requested financial and other information regarding the Triple Net securities offerings and the disclosures included in the related offering documents.

Our advisor is engaged in settlement negotiations with the SEC Staff regarding this matter. Based on these negotiations, our advisor believes that the conclusion to this matter will not result in a material adverse affect to its results of operations, financial condition or ability to conduct our business. The settlement negotiations are continuing, and any settlement negotiated with the SEC Staff must be approved by the Commissioners. Since the matter is not concluded, it remains subject to the risk that the SEC may seek additional remedies, including substantial fines and injunctive relief against our advisor that, if obtained, could harm our advisor’s ability to perform its duties to us. The matters that are the subject of this investigation could also give rise to claims against our advisor by investors in its existing real estate investment programs which could adversely affect our advisor’s performance with respect to us. At this time, we cannot assess how or when the outcome of the matter will be ultimately determined and its impact on us. Therefore, at this time, we have not accrued any loss contingencies in accordance with Statement of Financial Accounting Standards, or SFAS, No. 5, Accounting for Contingencies.

If we are unable to retain our advisor to complete the plan of liquidation, our liquidating distributions might be delayed or reduced.

Our day-to-day operations are managed by our advisor. We face the risk that we may lose the services of our advisor. The Advisory Agreement between our advisor and G REIT expired on July 22, 2005. Our advisor proposed that we bear additional costs under the terms of any new advisory agreement to reflect current market rates in our sector. However, in connection with the approval of the plan of liquidation by G REIT’s stockholders, our advisor’s then Board of Managers agreed to continue to provide such services to us on a month-to-month basis pursuant to the terms of the expired Advisory Agreement. However, we have no binding agreement with our advisor to continue to provide services pursuant to the expired Advisory Agreement and thus face the risk that our advisor will not continue to provide services to us. If we are unable to retain the services of our advisor throughout the period of the liquidation process, we may be unable to complete the plan of liquidation in as expeditious a manner as might otherwise be the case or on terms as favorable to us as our advisor may be able to do so, because of the loss of our advisor’s experience and familiarity with our assets and business. In addition, we would also incur transitional costs if we were either to become self-managed or enter an advisory relationship with a new advisor.

Even if we are able to retain the services of our advisor throughout the period of the liquidation process, our ability to complete the plan of liquidation in a timely manner also depends on the continued services of our executive officers. Our ability to complete any sales, to locate qualified buyers for our other assets and to negotiate and complete any such sales, depends to a large extent upon the experience and abilities of our advisor’s executive officers, including, without limitation, Scott D. Peters, Andrea R. Biller and Jeffrey T. Hanson, their familiarity with our assets, counter-parties to any sale agreements and the market for our remaining assets, and their ability to efficiently manage the professionals in the process as well as our advisor. We face the risk that our advisor or its affiliates’ employees may seek other employment rather than remain with our advisor or its affiliate throughout the period of the liquidation process. If our advisor is unable to retain appropriate qualified key executives and staff to complete the plan of liquidation in a reasonably expeditious manner, liquidating distributions to our beneficiaries might be delayed or reduced. Furthermore, the fees to be paid to our advisor pursuant to the Advisory Agreement are based in part upon the value of our assets managed by our advisor. As we sell our remaining assets during the period of the liquidation process, our advisor’s fees for managing our portfolio of properties will decrease. Accordingly, we face the risk that our advisor will reassign certain of our executive officers to the management of other entities advised by our advisor, and/or that our advisor may reduce the number or the amount of resources dedicated to the management of our remaining assets as we sell our remaining assets during the period of the liquidation process. If we lose the services of our executive officers or if we do not have sufficient resources dedicated to our management, we may be unable to complete the plan of liquidation in as expeditious a manner as we

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anticipate and, therefore, any liquidating distributions received by our beneficiaries may be delayed and/or reduced.

Our beneficiaries may not receive any profits resulting from the sale of one or more of our remaining assets, or receive such profits in a timely manner, because we may provide financing to the purchaser of such property.

Our beneficiaries may experience a delay before receiving their share of the net proceeds of such liquidation. In liquidation, we may sell our remaining assets either subject to or upon the assumption of any then outstanding mortgage debt or, alternatively, may provide financing to purchasers. We do not have any limitations or restrictions on the right to take such purchase money obligations. To the extent we receive promissory notes or other property in lieu of cash from sales, such proceeds, other than any interest payable on those proceeds, will not be included in net sale proceeds until and to the extent the promissory notes or other property are actually paid, sold, refinanced or otherwise disposed of. We may receive initial down payments in the year of sale in an amount less than the selling price and subsequent payments may be spread over a number of years. In such event, our beneficiaries may experience a delay in the distribution of the net proceeds of a sale until such time as the installment payments are received.

Our beneficiaries may recognize taxable income as a result of the transfer of G REIT’s assets and liabilities to us.

Upon the transfer of G REIT’s assets and liabilities to us on January 28, 2008, for federal income tax purposes, each beneficiary will be treated as having received a pro rata share of the assets transferred to us, less such beneficiary’s pro rata share of the liabilities assumed by us. Since we intend to qualify as a “liquidating (grantor) trust” for federal income tax purposes, we will generally not be subject to federal income tax. As a result, each beneficiary will need to take into account the effect of the transfer of assets when computing his or her taxable income. In the event that we have not sold any or all of our remaining assets by December 31, 2008, or made liquidating distributions to our beneficiaries from the sale of our remaining assets, our beneficiaries may recognize taxable income as a result of the transfer of the remaining assets to us without having received any funds to pay the related federal income taxes on such taxable income. In addition, our beneficiaries may recognize additional taxable income from the eventual sale of the remaining assets to the extent the proceeds from such sale are greater than the basis in such assets, which will include the gain recognized by our beneficiaries upon conversion to the liquidating trust, offset by the depreciation of the assets so long as such assets are held by us.

The value of our portfolio may be adversely affected by the adoption of the plan of liquidation.

Based on the approval of the plan of liquidation, we are committed to winding-up our operations. This may adversely affect the value that a potential acquirer might place on us or put pressure on us to sell our remaining assets at or below the low end of the estimated range, which would reduce the amount of liquidating distributions to our beneficiaries.

There can be no assurance that the plan of liquidation will result in greater returns to our beneficiaries on their investment within a reasonable period of time than our beneficiaries would receive through other alternatives reasonably available to us at this time.

Once our remaining assets are sold, our beneficiaries will no longer participate in any future earnings or growth of our remaining assets or benefit from any increases in the value of our remaining assets. While G REIT’s board of directors and the special committee each believed that a liquidation at the time would be more likely to provide our beneficiaries with a greater return on their investment within a reasonable period of time than our beneficiaries would receive through other alternatives reasonably available to us, such belief relied on certain assumptions and judgments concerning future events which may be unreliable or incorrect.

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Our Trustees may amend the plan of liquidation without further beneficiary approval.

Our Trustees may amend the plan of liquidation without further beneficiary approval, to the extent permitted by Maryland law. Thus, to the extent that Maryland law permits us to do so, we may decide to conduct the liquidation differently than previously described in our definitive proxy statement filed with the SEC on January 13, 2006.

Our Trustees have the authority to sell our remaining assets under terms less favorable than those assumed for the purpose of estimating our net liquidation value range.

Our Trustees have the authority to sell any and all of our remaining assets on such terms and to such parties as our Trustees determine in their sole discretion. Our beneficiaries will have no subsequent opportunity to vote on such matters and will, therefore, have no right to approve or disapprove the terms of such sales. Accordingly, our beneficiaries must rely solely on our Trustees’ judgment with respect to the sale process and our Trustees’ judgment may not always be the best judgment when evaluating in hindsight.

Approval of the plan of liquidation may lead to litigation which could result in substantial costs and distract our Trustees’ and advisor.

Historically, extraordinary corporate actions by a company, such as the plan of liquidation, sometimes lead to securities class action lawsuits being filed against that company. We may become involved in this type of litigation as a result of the plan of liquidation. As of March 24, 2008, no such lawsuits relative to the plan of liquidation have been filed nor do we know of any being contemplated. However, if such a lawsuit is filed against us, the resulting litigation is likely to be expensive and, even if we ultimately prevail, the process will divert our attention from implementing the plan of liquidation and otherwise operating our business. If we do not prevail in any such a lawsuit which may be filed against us in the future, we may be liable for damages. In such event, we cannot predict the amount of any such damages, however, if applicable, they may be significant and may reduce our cash available for distribution to our beneficiaries.

Our advisor has conflicts of interest that may influence its implementation of the plan of liquidation and may cause it to manage our liquidation in a manner not solely in the best interests of our beneficiaries.

Our advisor, its affiliates and our Trustees have interests in the liquidation that are different from our beneficiaries’ interests as a beneficiary. Our Trustees are aware of these actual and potential conflicts of interest, some of which are summarized below.

•   Our advisor or its affiliates receive compensation under the expired Advisory Agreement, including fees for disposing of our interests in our consolidated and unconsolidated properties. Our advisor has engaged Realty to provide various services to us in connection with our properties, including disposing of our remaining assets. In accordance with the plan of liquidation, our advisor or Realty will be paid to liquidate our remaining assets pursuant to the Advisory Agreement. Based on the estimated sales prices of our remaining assets as of December 31, 2007, we estimate that we will pay fees to Realty or its affiliates of approximately $1,541,000 for disposing of our remaining assets during liquidation. Our advisor or Realty also have agreements with certain affiliated co-owners of our properties, pursuant to which our advisor will also receive fees for the disposition of the affiliated co-owners’ interests in the properties. Based on our estimated sales prices as of December 31, 2007, we estimate that the total fees that will be received by our advisor or Realty from the affiliated co-owners will be approximately $1,668,000, which includes the fees to be received by our advisor under the Advisory Agreement. Moreover, if we sell one or more of our remaining assets to one of our affiliates or an affiliate of our advisor, our advisor and Realty may receive additional fees from the purchaser of the property.

•   Our advisor owns 23,138 units, and, therefore, in accordance with the plan of liquidation, based on the net assets in liquidation as of December 31, 2007, plus liquidating distributions to our beneficiaries through December 31, 2007, will be entitled to receive approximately $252,000 in liquidating distributions. These estimates include projections of costs and expenses expected to be incurred during

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the period required to complete the plan of liquidation. These projections could change materially based on the timing of any sales, the performance of the underlying assets and change in the underlying assumptions of the projected cash flows.

•   Our former Executive Vice President and Secretary, who is also an executive officer of our advisor, owns a total of 20,000 units, and, therefore, in accordance with the plan of liquidation, based on the net assets in liquidation as of December 31, 2007, plus liquidating distributions to our beneficiaries through December 31, 2007, will be entitled to receive approximately $218,000 in liquidating distributions. These estimates include projections of costs and expenses expected to be incurred during the period required to complete the plan of liquidation. These projections could change materially based on the timing of any sales, the performance of the underlying assets and change in the underlying assumptions of the projected cash flows.

•   Our Trustees own a total of 45,000 units in the aggregate and, therefore, in accordance with the plan of liquidation, based on the net assets in liquidation as of December 31, 2007, plus liquidating distributions to G REIT stockholders through December 31, 2007, will be entitled to receive approximately $490,000 in liquidating distributions. These estimates include projections of costs and expenses expected to be incurred during the period required to complete the plan of liquidation. These projections could change materially based on the timing of any sales, the performance of the underlying assets and change in the underlying assumptions of the projected cash flows.

•   Under the plan of liquidation approved by G REIT’s stockholders, G REIT’s independent directors were entitled to receive certain milestone payments of $25,000 on each of December 31, 2007 and 2006 for serving as members of G REIT’s board of directors and G REIT’s special committee. Our Trustees (and previously as the independent directors of G REIT) are also entitled to receive a milestone payment of $50,000 when we have made aggregate liquidating distributions of at least $11.00 per unit to our beneficiaries. Assuming that our Trustees receive the maximum amount of milestone payments for serving as our Trustees and for previously serving as members of G REIT’s board of directors and G REIT’s special committee, they will each receive aggregate payments of up to $100,000. As of March 24, 2008, based upon the satisfaction of performance milestones, each of Messrs. Hunt, Inlow, Johnson, Wallace and Wescombe have received milestone payments of $50,000 each from G REIT and/or G REIT Liquidating Trust.

•   G REIT paid Scott D. Peters, G REIT’s former Chief Executive Officer and President, and Andrea R. Biller, G REIT’s former Executive Vice President and Secretary, retention bonuses of $50,000 and $25,000, respectively, upon the filing of each of G REIT’s annual and quarterly reports with the SEC during the period of the liquidation process, beginning with the annual report for the year ending December 31, 2005. As of December 31, 2007, Mr. Peters and Ms. Biller had received, in the aggregate, retention bonuses of $400,000 and $200,000 from G REIT, respectively. Additionally, our advisor paid to each of Scott D. Peters and Andrea R. Biller a performance-based bonus of $100,000 upon the receipt by our advisor of net commissions aggregating $5,000,000 or more from the sale of G REIT’s properties. As of December 31, 2007, Mr. Peters and Ms. Biller had received their performance-based bonuses of $100,000 each from our advisor. Effective January 30, 2008 and March 4, 2008, Scott D. Peters and Andrea R. Biller, respectively, waived their rights to receive any future retention bonuses.

•   The plan of liquidation permits us to sell one or more of our remaining assets to one or more of our affiliates, but only if the transaction is approved by our Trustees. If we enter such a transaction, our Trustees will only approve the transaction if (i) they determine that the consideration to be received by us in connection with such transaction is fair to us and the transaction is in our best interests, and (ii) we have obtained an appraisal of such asset showing that the proposed sale price is within the appraiser’s range of estimated values for the asset, or we have obtained an opinion from Stanger, or another independent consultant, that the consideration to be received by us in connection with such sale is fair to us from a financial point of view. We expect that our Trustees will require that Stanger, or another independent consultant, opine to us, from a financial point of view, as to the fairness of the

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consideration to be received by us in such transaction or conduct an appraisal of the underlying property. In no event will our Trustees approve a transaction if we have received a higher offer for the property from a credible party whom we reasonably believe is ready, able and willing to close the transaction on the proposed terms. Additionally, if we sell one or more of our remaining assets to unaffiliated third parties or our affiliates, our advisor, Realty or an affiliate of our advisor may manage one or more of such properties following their sale, which would entitle our advisor, Realty or an affiliate of our advisor to receive additional fees.

•   Our advisor is entitled to receive certain incentive distributions from net proceeds from the sale of our remaining assets after our beneficiaries have received their invested capital, plus an 8.0% return on such invested capital. After the sale of our remaining assets, and payment of, or adequate provision for, the debts and obligations, our advisor will receive an incentive performance distribution between approximately $0 and $9,070,000. Based on the valuation of our portfolio as of December 31, 2007 and 2006, we have reserved for an estimated incentive fee distribution to our advisor of $763,000 and $3,226,000, respectively.

Consequently, our Trustees and our advisor are more likely to support the plan of liquidation than might otherwise be the case if they did not expect to receive those payments. Additionally, because of the above conflicts of interest, our Trustees and our advisor may make decisions or take actions based on factors other than the best interests of our beneficiaries throughout the period of the liquidation process.

Our adoption of the plan of liquidation caused our accounting basis to change, which could require us to write-down our remaining assets.

Due to the adoption of the plan of liquidation, we changed our basis of accounting from the going-concern basis to that of the liquidation basis of accounting. In order for our financial statements to be in accordance with generally accepted accounting principles, or GAAP, under the liquidation basis of accounting, all of our remaining assets must be stated at their estimated net realizable value and all of our liabilities must be recorded at the estimated amounts at which the liabilities are expected to be settled. Based on the most recent available information, we may make liquidating distributions to our beneficiaries that exceed the carrying amount of our net assets. However, we cannot assure our beneficiaries what the ultimate amounts of such liquidating distributions will be. Therefore, there is a risk that the liquidation basis of accounting may entail write-downs of certain of our remaining assets to values substantially less than their respective carrying amounts, and may require that certain of our liabilities be increased or certain other liabilities be recorded to reflect the anticipated effects of an orderly liquidation. A write-down in our remaining assets could make it more difficult to negotiate amendments to our debt instruments or result in defaults under any debt instruments that we may enter. In addition, write-downs in our remaining assets could reduce the price that a third party would be willing to pay to acquire our remaining assets.

Beneficiaries could be liable to the extent of liquidating distributions received if contingent reserves are insufficient to satisfy our liabilities.

If we fail to create an adequate contingency reserve for payment of our expenses and liabilities, each beneficiary could be held liable for the payment to creditors of such beneficiary’s pro rata portion of the excess, limited to the amounts previously received by each beneficiary in distributions from us or G REIT.

If a court holds at any time that we have failed to make adequate provision for our expenses and liabilities or if the amount ultimately required to be paid in respect of such liabilities exceeds the amount available from the contingency reserve and the remaining assets, our creditors could seek an injunction to prevent us from making liquidating distributions to our beneficiaries under the plan of liquidation on the grounds that the amounts to be distributed are needed to provide for the payment of our expenses and liabilities. Any such action could delay or substantially diminish the cash distributions to be made to beneficiaries under the plan of liquidation.

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We may have underestimated the amount of prepayment fees or defeasance charges on our mortgages.

In calculating our estimated net liquidation value range and our estimated per share distribution range, we have assumed that the purchasers of our properties will assume certain mortgages on the underlying property, which contain penalties in the event of the prepayment of those mortgages. The sale of our remaining assets pursuant to the plan of liquidation will trigger substantial penalties unless the purchasers assume (and/or are allowed to assume) the corresponding mortgage. We may be unsuccessful in negotiating the assumption of any underlying mortgages in the sale of any of our remaining assets, which could negatively affect the amount of cash available for distribution to our beneficiaries pursuant to the plan of liquidation. As of December 31, 2007, the total amount of prepayment fees on our mortgages, which we may be liable for, is approximately $188,000.

We expect to incur increasingly significant costs in connection with Sarbanes-Oxley compliance and we may become subject to liability for any failure to comply.

The Sarbanes-Oxley Act of 2002, as amended, or the Sarbanes-Oxley Act, and related laws, regulations and standards relating to corporate governance and disclosure requirements applicable to public companies have increased the costs of corporate governance, reporting and disclosure practices which are now required of us. We expect that our efforts to continue to comply with the Sarbanes-Oxley Act and applicable laws and regulations will continue to involve significant, and potentially increasing, costs. In addition, these laws, rules and regulations create new legal bases for administrative enforcement, civil and criminal proceedings against us in case of non-compliance, thereby increasing our risks of liability and potential sanctions.

While we are not aware of any material non-compliance with the Sarbanes-Oxley Act and related laws and regulations, we were formed prior to the enactment of these corporate governance standards and as a result we did not have all necessary procedures and policies in place at the time of their enactment. Any failure to comply with the Sarbanes-Oxley Act could result in fees, fines, penalties or administrative remedies, which could reduce and/or delay the amount of liquidating distributions to our beneficiaries under the plan of liquidation.

Risks of our Business

Erroneous disclosures in the prior performance tables in G REIT’s initial and second public offering documents could result in lawsuits or other actions against us which could have a material adverse effect upon our business and results of operations.

In connection with G REIT’s initial and second public offerings of common stock conducted through best efforts offerings from July 22, 2002 through April 30, 2004, G REIT disclosed the prior performance of all public and non-public investment programs sponsored by our advisor. Our advisor determined that there were certain errors in those prior performance tables. In particular, the financial information in the tables was stated to be presented on a GAAP basis. In general, the tables for the public programs were not presented on a GAAP basis and the tables for the non-public programs were prepared and presented on a tax or cash accounting basis. Moreover, a number of the prior performance data figures were themselves erroneous, even as presented on a tax or cash basis. In particular, certain programs sponsored by our advisor have invested either along side or in other programs sponsored by our advisor. The nature and results of these investments were not fully and accurately disclosed in the tables. In addition, for the private programs, certain calculations of depreciation and amortization were not on an income tax basis for a limited liability company investment, certain operating expenses were not reflected in the operating results, and monthly mortgage and principal payments were not reported. In general, the resulting effect is an overstatement of our advisor’s program and aggregate portfolio operating results. The overstatement of results could result in lawsuits or other actions against us which could have a material adverse effect upon our business and results of operations. At this time there is no litigation related to the prior performance tables.

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Due to the risks involved in the ownership of real estate, there is no guarantee of any return on our beneficiaries’ investments and our beneficiaries may lose some or all of their investment.

In owning units of beneficial interest, our beneficiaries are subjected to the risks associated with owning real estate. Ownership of real estate is subject to significant risks. The performances of our beneficiaries’ investments in us are subject to risks related to the ownership and operation of real estate, including:

•   changes in the general economic climate;

•   changes in local conditions such as an oversupply of space or reduction in demand for real estate;

•   changes in interest rates and the availability of financing; and

•   changes in laws and governmental regulations, including those governing real estate usage, zoning and taxes.

If any of our properties decrease in value, the value of our beneficiaries’ investments will likewise decrease and they could lose some or all of their investment.

If our unconsolidated property is unable to generate sufficient funds to pay its expenses, liabilities or distributions, our liquidating distributions to our beneficiaries may be reduced and/or delayed.

If Congress Center, located in Chicago, Illinois, or the Congress Center property, of which we own 30.0%, is unable to generate sufficient funds to pay its expenses, liabilities or distributions, the Congress Center property may need to borrow funds from affiliates or third parties to pay such expenses, liabilities or distributions and incur an interest expense. For example, on February 1, 2008, the Congress Center property entered into an unsecured loan with NNN Realty Advisors, Inc., or NNN Realty Advisors, evidenced by an unsecured promissory note in the principal amount of $225,000. The unsecured note provides for a maturity date of July 31, 2008, bears interest at a fixed rate of 7.64% per annum and requires monthly interest-only payments for the term of the unsecured note. The payment of interest expenses may reduce the amount available for distributions to us which may then reduce or delay the timing of our liquidating distributions to our beneficiaries since the Congress Center property is our one remaining unconsolidated property and source of revenue.

Our properties face significant competition.

We face significant competition from other owners, operators and developers of office properties. All or substantially all of our properties face competition from similar properties owned by others in the same markets. Such competition may affect our ability to attract and retain tenants and may reduce the rents we are able to charge. These competing properties may have vacancy rates higher than our properties, which may cause their owners to rent space at lower rental rates than those charged by us or to provide greater tenant improvement allowances or other leasing concessions than we provide to our tenants. As a result, we may be required to provide rent concessions, incur charges for tenant improvements and other inducements, or we may not be able to timely lease the space, all of which would adversely impact our results of operations, liquidity and financial condition, which could reduce liquidating distributions to our beneficiaries. As we dispose of each of our remaining assets, we will be in competition with sellers of similar properties to locate suitable purchasers, which may result in us receiving lower proceeds from the sale or result in us not being able to sell the property due to the lack of an acceptable return.

We depend upon our tenants to pay rent, and their inability to pay rent may substantially reduce our revenues and cash available for distribution to our beneficiaries.

Our investments in office properties are subject to varying degrees of risk that generally arise from the ownership of real estate. The value of our properties and the ability to make distributions to our beneficiaries depend upon the ability of the tenants at our properties to generate enough income in excess of their operating expenses to make their lease payments to us. Changes beyond our control may adversely affect our tenants’ ability to make their lease payments to us and, in such event, would substantially reduce both our income

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from operations and our ability to make distributions to our beneficiaries. These changes include, among others, the following:

•   downturns in national, regional or local economic conditions where our properties are located, which generally will negatively impact the demand for office space and rental rates;

•   changes in local market conditions such as an oversupply of office properties, including space available by sublease, or a reduction in demand for the lease of office properties, making it more difficult for us to lease space at attractive rental rates or at all;

•   competition from other available office properties owned by others, which could cause us to lose current or prospective tenants or cause us to reduce rental rates to competitive levels;

•   our ability to pay for adequate maintenance, insurance, utility, security and other operating costs, including real estate taxes and debt service payments, that are not necessarily reduced when circumstances such as market factors and competition cause a reduction in income from a property; and

•   changes in federal, state or local regulations and controls affecting rents, prices of goods, interest rates, fuel and energy consumption.

Due to these changes, among others, tenants and lease guarantors, if any, may be unable to make their lease payments. A default by a tenant or the failure of a tenant’s guarantor to fulfill its obligations to us, or an early termination of a lease as a result of a tenant default or otherwise could, depending upon the size of the leased premises and our advisor’s ability to successfully find a substitute tenant, have a material adverse effect on our revenues and cash available for distribution to its members. Moreover, as of December 31, 2007, rent paid by the ten largest tenants at our consolidated properties represented 46.2% of our annualized revenues. The revenues generated by the properties these tenants occupy is substantially dependent on the financial condition of these tenants and, accordingly, any event of bankruptcy, insolvency or a general downturn in the business of any of these large tenants may result in the failure or delay of such tenants’ rental payments which may have an adverse impact on our financial performance and our ability to pay liquidating distributions to our beneficiaries.

Lack of diversification and illiquidity of real estate may make it difficult for us to sell underperforming properties or recover our investment in one or more properties.

Our business is subject to risks associated with investment solely in real estate. Real estate investments are relatively illiquid. Pursuant to the plan of liquidation, we expect to liquidate our remaining assets by September 30, 2008; however, due to the illiquid nature of real estate and the short timeframe that we have to sell our remaining assets, we may not recoup the estimated fair value we have recorded as of December 31, 2007 by September 30, 2008. We cannot provide assurance that we will be able to dispose of our remaining assets by September 30, 2008 which could adversely impact the timing and amount of distributions.

Lack of geographic diversity may expose us to regional economic downturns that could adversely impact our operations or our ability to recover our investment in one or more properties.

Our portfolio lacks geographic diversity due to its limited size and the fact that we have only four remaining assets (one of which we have an underlying interest in one real property) as of March 24, 2008. As of March 24, 2008, our four remaining assets were located in three states: California, Texas and Illinois. This geographic concentration of properties exposes us to economic downturns in these regions. A recession in these states could adversely affect our ability to generate or increase operating revenues, attract new tenants or dispose of properties. In addition, our properties may face competition in any of these states from other properties owned, operated or managed by our advisor or its affiliates or third parties. Our advisor or its affiliates have interests that may vary from our interests in such states.

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Our consolidated properties depend upon the California and Texas economies and the demand for office space.

As of March 24, 2008, we had a 15.2% and 84.8% concentration of tenants in our California and Texas properties, respectively, based on aggregate annual rental income. We are susceptible to adverse developments in California and Texas (such as business layoffs or downsizing, industry slowdowns, relocations of businesses, changing demographics, increased telecommuting, terrorist targeting of high-rise structures, infrastructure quality, California and Texas state budgetary constraints and priorities, increases in real estate and other taxes, costs of complying with government regulations or increased regulation and other factors) and the national, California and Texas office space market (such as oversupply of or reduced demand for office space). In addition, the State of California continues to address issues related to budget deficits, shortages of electricity, interruptions in power service, increased energy costs, and the continued solvency of its utility companies, any or all of which may create the perception that the State is not able to effectively manage itself, in turn reducing demand for office space in California. The State of California is also generally regarded as more litigious and more highly regulated and taxed than many states, which may reduce demand for office space in California. Any adverse economic or real estate developments in California and Texas, or any decrease in demand for office space resulting from California’s regulatory environment, business climate or energy or fiscal problems, could adversely impact our financial condition, results of operations, cash flow, and our ability to satisfy our debt service obligations and to pay liquidating distributions to our beneficiaries. We cannot assure the continued growth of the California and Texas economies or the national economy or our future growth rate.

Losses for which we either could not or did not obtain insurance will adversely affect our earnings and we may be unable to comply with insurance requirements contained in mortgage or other agreements due to high insurance costs.

We and our advisor endeavor to maintain comprehensive insurance on each of the properties we own, including liability and fire and extended coverage, in amounts sufficient to permit the replacement of the properties in the event of a total loss, subject to applicable deductibles. However, we could still suffer a loss due to the cost to repair any damage to properties that are not insured or are underinsured. There are types of losses, generally of a catastrophic nature, such as losses due to terrorism, wars, earthquakes, floods or acts of God that are either uninsurable or not economically insurable. If such a catastrophic event were to occur, or cause the destruction of one or more of our properties, we could lose both our invested capital and anticipated profits from such property or properties. Additionally, we could default under our debt instruments or other agreements if the cost and/or availability of certain types of insurance make it impractical or impossible to comply with covenants relating to the insurance we are required to maintain under such agreements. In such instances, we may be required to self-insure against certain losses or seek other forms of financial assurance. Additionally, inflation, changes in building codes and ordinances, environmental considerations, and other factors also might make it infeasible to use insurance proceeds to replace a property if it is damaged or destroyed. Under such circumstances, the insurance proceeds received by us might not be adequate to restore our economic position with respect to the affected property.

Our co-ownership arrangements with affiliated entities may not reflect solely our beneficiaries’ best interests and may subject these investments to increased risks.

We have acquired our interests in the Congress Center property and Western Place I & II located in Fort Worth, Texas, or the Western Place I & II property, through co-ownership arrangements with other entities managed or advised by our advisor and its affiliates. These acquisitions are financed, in part, by loans under which we are jointly and severally liable for the entire loan amount along with the other co-owners. In addition, investing in properties through co-ownership arrangements subjects that investment to risks not present in a wholly-owned property, including, among others, the following:

•   the risk that the co-owner(s) in the investment might become bankrupt;

•   the risk that the co-owner(s) may at any time have economic or business interests or goals which are inconsistent with our business interests or goals;

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•   the risk that the co-owner(s) may be unable to make required payments on loans under which we are jointly and severally liable; or

•   the risk that the co-owner(s) may be in a position to take action contrary to our instructions or requests or contrary to our policies or objectives, such as selling a property at a time when it would have adverse consequences to us.

Actions by co-owner(s) might have the result of subjecting the applicable property to liabilities in excess of those otherwise contemplated and may have the effect of reducing our cash available for distribution to our beneficiaries. It also may be difficult for us to sell our interest in any co-ownership arrangement at the time we deem best for our beneficiaries.

There is currently no public market for our units of beneficial interest and the units of beneficial interest may not be transferred except by operation of law or upon the death of a beneficiary.

Our beneficiaries are not able to transfer their units other than in limited circumstances. The units are not and will not be listed on any exchange, quoted by a securities broker or dealer, nor admitted for trading in any market, including the over-the-counter market. The units are not transferable except by operation of law or upon the death of a beneficiary.

We may not have sufficient cash flow to cover our required debt service payments which could result in foreclosures and unexpected debt service expenses upon refinancing, both of which could have an adverse impact on our operations and cash flow. Additionally, restrictive covenants in our loan documents may restrict our disposition activities.

As of March 24, 2008, we had $120,035,000 of debt outstanding related to properties in which we have interests, which includes our consolidated and unconsolidated properties. Based upon our interest in such properties, our aggregate debt approximates $47,772,000 (on a liquidation basis) as of March 24, 2008. Accordingly, we are subject to the risks normally associated with debt financing, including, without limitation, the risk that our cash flow may not be sufficient to cover required debt service payments. There is also a risk that, if necessary, existing indebtedness will not be able to be refinanced or that the terms of such refinancing will not be as favorable as the terms of the existing indebtedness.

In addition, if we cannot meet our required mortgage payment obligations, the property or properties subject to such mortgage indebtedness could be foreclosed upon by, or otherwise transferred to, our lender, with a consequent loss of income and asset value to us. For tax purposes, a foreclosure of any of our properties would be treated as a sale of the property for a purchase price equal to the outstanding balance of the debt secured by the mortgage. If the outstanding balance of the debt secured by the mortgage exceeds our tax basis in the property, we would recognize taxable income on foreclosure, but we may not receive any cash proceeds.

The mortgages on our properties contain customary restrictive covenants such as satisfaction of certain total debt-to-asset ratios, secured debt-to-total-asset ratios, and debt service coverage ratios. The mortgages also include provisions that may limit our ability, without the prior consent of the lender, to incur additional indebtedness, further mortgage or transfer the applicable property, discontinue insurance coverage, change the conduct of its business or make loans or advances to, enter into any transaction of merger or consolidation with, or acquire the business, assets or equity of, any third party. In addition, any future lines of credit or loans may contain financial covenants, further restrictive covenants and other obligations.

If we materially breach such covenants or obligations in our debt agreements, the lender may, including, without limitation, seize our income from the property securing the loan or legally declare a default on the loan obligation, require us to repay the debt immediately and foreclose on the property securing the loan. If we were to breach such covenants or obligations, we may then have to sell properties either at a loss or at a time that prevents us from achieving a higher price. Any failure to pay our indebtedness when due or failure to cure events of default could result in higher interest rates during the period of the loan default and could ultimately result in the loss of properties through foreclosure. Additionally, if the lender were to seize our

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income from the property securing the loan, we would no longer have any discretion over the use of the income, which may adversely impact our ability to fund our liquidating distributions.

The pending SEC investigation of our advisor could result in defaults or alleged defaults under our loan documents or limit our ability to obtain debt financing in the future.

We rely on debt financing for meeting capital expenditure obligations, among other things. The SEC investigation of our advisor described above, or any related other enforcement action by government authorities against our advisor or us, could result in defaults or alleged defaults under our existing loan agreements or could make it more difficult for us to obtain new debt financing or prevent us from satisfying customary debt covenants or conditions required by existing loan documents, including conditions for additional advances.

The real estate we own may not appreciate or may decrease in value.

The commercial real estate market has experienced a substantial influx of capital from investors in the past. This substantial flow of capital, combined with significant competition for real estate, may have resulted in inflated purchase prices for such assets. To the extent we own real estate in such an environment, we are subject to the risk that if the real estate market ceases to attract the same level of capital investment in the future as it has attracted in the past, or if the number of companies seeking to acquire such assets decreases, our returns will be lower and the value of our remaining assets may not appreciate or may decrease significantly below the amount we paid for such assets.

Because some of our principal tenants are U.S. government and state agencies, our properties may have a higher risk of terrorist attack than similar properties leased to non-governmental tenants.

Because some of our principal tenants are U.S. government and state agencies, our properties may have a higher risk of terrorist attack than similar properties that are leased to non-government tenants. Some of our properties could be considered “high profile” targets because of the particular government tenant. Certain losses resulting from terrorist attacks may be uninsurable. Additional terrorism insurance may not be available at a reasonable price or at all.

We depend on the U.S. government for a significant portion of our revenues. Any failure by the U.S. government to perform its obligations or renew its leases upon expiration may harm our cash flow and ability to pay liquidating distributions.

Rent from government tenants represented 33.2% of G REIT’s revenues from consolidated properties for the year ended December 31, 2007. In addition, government tenants leased 31.5% of G REIT’s total leased space as of December 31, 2007. Any default by the U.S. government, or its failure to renew its leases with us upon their expiration, could cause interruptions in the receipt of lease revenue or result in vacancies, or both, which would reduce our revenues and could decrease the ultimate value of the affected property upon sale. Further, failure on the part of a tenant to comply with the terms of a lease may cause us to find another tenant. We cannot assure our beneficiaries that we would be able to find another tenant without incurring substantial costs, or at all, or that, if another tenant were found, we would be able to enter into a new lease on favorable terms.

An increase in the operating costs of our government-leased properties would harm our cash flow and ability to pay liquidating distributions.

Leased properties in which the tenant is wholly responsible for any increases in operating costs that apply to the property are not typical of the leases entered into through the General Services Administration, or GSA, the principal leasing agency of the federal government. Under present practice, most GSA leases only cover increases in real estate taxes above a base amount and these GSA leases also increase that portion of the rent applicable to other operating expenses by an agreed upon percentage based upon the consumer price index. Typically, operating expenses in these leases do not include insurance cost. To the extent operating costs other

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than real estate taxes and insurance increase at a rate greater than the specified percentage, our cash flow would be harmed and our ability to pay liquidating distributions to our beneficiaries may be harmed.

Since our cash flow is not assured, we may not pay distributions in the future.

Our ability to pay distributions, including liquidating distributions to our beneficiaries, may be adversely affected by the risks described herein. We cannot assure our beneficiaries that we will be able to pay distributions in the future at the same level or at all. We also cannot assure our beneficiaries that the level of our distributions will increase over time or the receipt of income from additional property acquisitions will necessarily increase our cash available for distribution to our beneficiaries.

The conflicts of interest of our advisor’s executives with us mean we will not be managed by our advisor solely in the best interests of our beneficiaries.

Our advisor’s executives have conflicts of interest relating to the management of our business and property. Accordingly, those parties may make decisions or take actions based on factors other than in the best interest of our beneficiaries.

Our advisor also advises T REIT Liquidating Trust, is the managing member of the advisors of both Grubb & Ellis Apartment REIT, Inc. and Grubb & Ellis Healthcare REIT, Inc., and manages NNN 2002 Value Fund, LLC, NNN 2003 Value Fund, LLC, as well as other private tenant-in-common programs and other programs, all of which may compete with us or otherwise have similar business interests and/or investment objectives. Some of the executive officers of our advisor also serve as officers and directors of NNN 2003 Value Fund, LLC, Grubb & Ellis Apartment REIT, Inc. and Grubb & Ellis Healthcare REIT, Inc. Our advisor is a wholly owned indirect subsidiary of Grubb & Ellis Company, or Grubb & Ellis, and executive officers of our advisor collectively own approximately 4.1% of Grubb & Ellis. As officers, directors, and partial owners of entities that do business with us or that have interests in competition with our own interests, these individuals will experience conflicts between their obligations to us and their obligations to, and pecuniary interests in, our advisor, Grubb & Ellis and its affiliated entities. These conflicts of interest could:

•   limit the time and services that our advisor devotes to us, because it will be providing similar services to T REIT Liquidating Trust, NNN 2002 Value Fund, LLC, NNN 2003 Value Fund, LLC, Grubb & Ellis Apartment REIT, Inc. and Grubb & Ellis Healthcare REIT, Inc. and other real estate programs and properties;

•   impair our ability to compete for tenants in geographic areas where other properties are advised by our advisor and its affiliates; and

•   impair our ability to compete for the disposition of properties with other real estate entities that are also advised by our advisor and its affiliates and seeking to dispose of properties at or about the same time as us.

If our advisor or its affiliates breach their fiduciary obligations to us, we may not meet our investment objectives, which could reduce the expected cash available for distribution to our beneficiaries.

The absence of arm’s length bargaining may mean that our agreements are not as favorable to our beneficiaries as these agreements otherwise would have been.

Any existing or future agreements between us and our advisor, Realty or their affiliates were not and will not be reached through arm’s length negotiations. Thus, such agreements may not solely reflect our beneficiaries’ interests. For example, the Advisory Agreement was not the result of arm’s length negotiations. As a result, this agreement may be relatively more favorable to our advisor than to us.

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Dramatic increases in insurance rates could adversely affect our cash flow and our ability to make liquidating distributions to our beneficiaries pursuant to the plan of liquidation.

Due to recent natural disasters resulting in massive property destruction, prices for insurance coverage have been increasing dramatically. We cannot assure that we will be able to renew our insurance premiums at our current or reasonable rates or the amount of the potential increase of such premiums. As a result, our cash flow could be adversely impacted by increased premiums. In addition, the sales prices of our properties may be affected by these rising costs and adversely affect our ability to make liquidating distributions to our beneficiaries pursuant to the plan of liquidation.

Item 1B.      Unresolved Staff Comments.

Not applicable.

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Item 2.      Properties.

As of December 31, 2007, G REIT owned four consolidated office properties located in three states with an aggregate GLA of 984,000 square feet. G REIT also owned an interest in one unconsolidated office property located in Illinois with an aggregate GLA of 519,000 square feet. As of December 31, 2007, 18.1% of the aggregate GLA of these consolidated properties was leased to governmental related entities. On March 12, 2008, we sold one of the consolidated properties, Pax River Office Park located in Lexington Park, Maryland, which comprised 17.5% of G REIT’s GLA as of of December 31, 2007.

The following table presents certain additional information about the consolidated properties as of December 31, 2007:

														% Total						Annual
	Property	GLA		% of			%			Date		Annual		of Annual			Physical			Rent per
Property	Location	(Sq Ft)		GLA			Owned			Acquired		Rent(1)		Rent			Occupancy(2)			Sq Ft(3)
Sutter Square Galleria	Sacramento, CA		61,000		6.2	%		100.0	%		10/28/03	$	1,120,000		11.8	%		90.8	%	$	20.18
Pacific Place	Dallas, TX		324,000		32.9	%		100.0	%		05/26/04		—		—			—		$	—
Western Place I & II	Fort Worth, TX		427,000		43.4	%		78.5	%		07/23/04		6,264,000		65.9	%		85.9	%	$	17.07
Pax River Office Park	Lexington Park, MD		172,000		17.5	%		100.0	%		08/06/04		2,122,000		22.3	%		81.9	%	$	15.04
Totals			984,000									$	9,506,000					57.2	%	$	16.87

(1)	Annual rental income is based on contractual base rent from leases in effect as of December 31, 2007.
(2)	As of December 31, 2007, approximately 57.2% of the total GLA in the consolidated properties was leased.
(3)	Average annual rent per occupied square foot as of December 31, 2007.

The following information generally applies to the properties:

•   we believe all of our properties are adequately covered by insurance and are suitable for their intended purposes;

•   we have no plans for any material renovations, improvements or development of our properties, except in accordance with planned budgets;

•   our properties are located in markets where we are subject to competition in attracting new tenants and retaining current tenants; and

•   prior to the adoption of the plan of liquidation, depreciation was provided on a straight-line basis over the estimated useful lives of the buildings, ranging primarily from 15 to 39 years and over the shorter of the lease term or useful lives of the tenant improvements. Properties cease to be depreciated under the liquidation basis of accounting.

Significant Tenants

As of December 31, 2007, none of the tenants at the consolidated properties accounted for 10.0% or more of G REIT’s aggregate annual rental income. However, separate agencies of the General Services Administration had two leases at one of the consolidated properties which accounted for 2.4% of our aggregate annual rental income as of December 31, 2007.

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Ownership Information

The following is a summary of our organizational structure and the properties we owned and held interests in as of December 31, 2007:

The following is a summary of our ownership information for the properties in which we own less than a 100.0% interest:

Ownership of Congress Center

The following is a summary of our relationships with entities with ownership interests in one of our consolidated properties, the Congress Center property, as of December 31, 2007:

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Ownership of Western Place I & II

The following is a summary of our relationships with entities with ownership interests in Western Place I & II as of December 31, 2007:

Lease Expiration Table

The following table presents the sensitivity of our annual base rent due to lease expirations for the next 10 years at the consolidated properties as of December 31, 2007, by number, square feet, percentage of leased area and annual base rent.

	Number of				% of Leased Area			Annual Rent		% of Total Annual
Year Ending	Leases		Total Sq. Ft. of		Represented by			Under Expiring		Rent Represented
December 31	Expiring		Expiring Leases		Expiring Leases			Leases		by Expiring Leases(1)
2008		16		87,000		16.3	%	$	1,648,000		17.4	%
2009		10		60,000		11.2			1,044,000		11.0
2010		21		157,000		29.3			2,366,000		24.9
2011		10		58,000		10.9			955,000		10.0
2012		10		95,000		17.8			1,722,000		18.1
2013		1		11,000		2.1			216,000		2.3
2014		4		35,000		6.6			555,000		5.8
2015		2		31,000		5.8			505,000		5.3
2016		—		—		—			—		—
2017		—		—		—			—		—
Thereafter		—		—		—			—		—
Total		74		534,000		100.0	%	$	9,011,000		94.8	%

(1) The annual rent percentage is based on the total annual base rent as of December 31, 2007, which, in addition to leases with scheduled expirations as included in this table, include certain tenants that have leases extended on a monthly basis.

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Concentration of Tenants

The following table sets forth information as to the ten largest tenants at our consolidated properties as of December 31, 2007, based upon aggregate annual rental income.

		Current		Total			Rentable
		Annual		Rental			Square		Lease		Renewal
Lessee	Property	Base Rent		Income			Feet		Expiration		Options
NAVAIR-USA Naval Air Systems*	Pax River Office Park (1)	$	750,000		7.9	%		35,000		8/14/2008	Two years
Lockheed Martin/EIS*	Western Place I & II		616,000		6.5			38,000		12/31/2010	Three 3 year
THS Business Telecommunications	Western Place I & II		530,000		5.6			31,000		2/28/2010	Two years
BAE Systems*	Western Place I & II		511,000		5.4			30,000		4/30/2012	Two 5 year
Leprechaun, LLC	Western Place I & II		372,000		3.9			20,000		10/31/2012	Five years
J.F. Taylor, Inc.	Pax River Office Park(1)		366,000		3.9			30,000		3/31/2010	None
UC Davis Extension*	Sutter Square		344,000		3.6			18,000		1/1/2012	Two 5 year
Apex Capital Corp	Western Place I & II		342,000		3.6			21,000		12/31/2015	None
Taylor, Olson, Adkins, Sralla & Elam	Western Place I & II		301,000		3.2			20,000		11/30/2014	Two 5 year
Lockheed Martin Corporation-OWEGO*	Pax River Office Park (1)		243,000		2.6			17,000		12/31/2009	Two 3 year
		$	4,375,000		46.2	%		260,000

*	Government entity or government contractor.
(1)	Pax River Office Park was sold on March 12, 2008.

The loss of the above-mentioned tenants or their inability to pay rent could have a material adverse effect on our business and results of operations.

Geographic Diversification; Concentration Table

The following table lists, in alphabetical order, the states in which our consolidated properties are located and provides certain information regarding our portfolio’s geographic diversification/concentration as of December 31, 2007.

			Aggregate		Approximate % of			Current		Approximate % of
	No. of		Rentable		Rentable			Annual		Aggregate
State	Properties		Square Feet		Square Feet			Base Rent		Annual Rent
California		1		61,000		6.2	%	$	1,120,000		11.8	%
Maryland*		1		172,000		17.5			2,122,000		22.3
Texas		2		751,000		76.3			6,264,000		65.9
Total		4		984,000		100.0	%	$	9,506,000		100.0	%

* The only property located in Maryland was Pax River Office Park which was sold on March 12, 2008. Immediately following the sale of Pax River Office Park, the approximate percentage of rentable square feet was 7.5% and 92.5% in California and Texas, respectively, and the approximate percentage of aggregate annual rent was 15.2% and 84.8% in California and Texas, respectively.

We are also subject to a concentration of regional economic exposure as 84.8% of our current aggregate annual base rental income is generated by our consolidated properties located in Texas. Regional economic downturns in Texas could adversely impact our operations.

Indebtedness

As of December 31, 2007, we had a secured mortgage loan outstanding on one of our consolidated properties, representing aggregate indebtedness in the principal amount of $24,000,000 ($18,840,000 on a liquidation basis) of variable rate debt at a weighted-average interest rate of 8.13% per annum. See Item 7: “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Note 8 — “Mortgage Loans Payable Secured by Properties Held for Sale” to the consolidated financial statements included with this report.

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Item 3.      Legal Proceedings.

SEC Investigation

On September 16, 2004, our advisor advised G REIT that it learned that the SEC Los Angeles Enforcement Division, or the SEC Staff, was conducting an investigation referred to as “In the matter of Triple Net Properties, LLC.” The SEC has requested information from our advisor relating to disclosure in public and private securities offerings sponsored by our advisor and its affiliates, or the Triple Net securities offerings (including offerings by G REIT). The SEC has requested financial and other information regarding the Triple Net securities offerings and the disclosures included in the related offering documents.

Our advisor is engaged in settlement negotiations with the SEC Staff regarding this matter. Based on these negotiations, our advisor believes that the conclusion to this matter will not result in a material adverse affect to its results of operations, financial condition or ability to conduct our business. The settlement negotiations are continuing, and any settlement negotiated with the SEC Staff must be approved by the Commissioners. Since the matter is not concluded, it remains subject to the risk that the SEC may seek additional remedies, including substantial fines and injunctive relief against our advisor that, if obtained, could materially adversely affect our advisor’s ability to perform its duties to us. The matters that are the subject of this investigation could also give rise to claims against our advisor by investors in its existing real estate investment programs which could adversely affect our advisor’s performance with respect to us. At this time, we cannot assess how or when the outcome of the matter will be ultimately determined and its impact on us. Therefore, at this time, we have not accrued any loss contingencies in accordance with Statement of Financial Accounting Standards, or SFAS, No. 5.

Prior Performance Tables

In connection with G REIT’s initial and second public offerings of common stock conducted through “best efforts” offerings from July 22, 2002 through April 30, 2004, G REIT disclosed the prior performance of all public and private investment programs sponsored by our advisor. Our advisor determined that there were certain errors in those prior performance tables. In particular, the financial information in the tables was stated to be presented on a GAAP basis. Generally the tables for the public programs were not presented on a GAAP basis and the tables for the private programs were prepared and presented on a tax or cash accounting basis. Moreover, a number of the prior performance data figures were themselves erroneous, even as presented on a tax or cash basis. In particular, certain programs sponsored by our advisor have invested either along side or in other programs sponsored by our advisor. The nature and results of these investments were not fully and accurately disclosed in the tables. In addition, for the private programs certain calculations of depreciation and amortization were not on an income tax basis for limited liability company investments; certain operating expenses were not reflected in the operating results; and monthly mortgage and principal payments were not reported. In general, the resulting effect is an overstatement of our advisor’s program and aggregate portfolio operating results. At this time there is no litigation related to the prior performance tables.

Revised prior performance tables reflecting corrected numbers and disclosures from those initially included in G REIT’s prospectuses dated July 22, 2002 and January 23, 2004 were included in G REIT’s definitive proxy statement and G REIT’s Current Report on Form 8-K filed with the SEC on January 13, 2006.

Litigation

To our knowledge, there are no material pending legal proceedings, nor any planned, other than routine litigation incidental to our business to which we are a party or of which certain of our properties are subject.

Item 4.      Submission of Matters to a Vote of Security Holders.

No matters were submitted to a vote of security holders during the fourth quarter of 2007.

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PART II

Item 5.      Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Market Information

There is no public market for the units of beneficial interests in G REIT Liquidating Trust. The units are not and will not be listed on any exchange, quoted by a securities broker or dealer, nor admitted for trading in any market, including the over-the-counter market. The units are not transferable except by operation of law or upon the death of a beneficiary.

Beneficiaries

As of March 24, 2008, we had approximately 14,000 beneficiaries.

Distributions

Since the approval of the plan of liquidation, G REIT has paid three special liquidating distributions as follows: (i) in October 2006, G REIT paid $171,289,000, or $3.90 per share; (ii) in April 2007, G REIT paid $131,761,000, or $3.00 per share; and (iii) in November 2007, G REIT paid $43,920,000, or $1.00 per share, for a total of $7.90 per share being paid to date in special liquidating distributions. In addition, G REIT paid cumulative monthly liquidating distributions beginning with the April 2006 distribution, paid in May 2006, through and including the December 2007 distribution, paid in January 2008, totaling $34,724,000, or $0.79 per share, to its stockholders. The monthly liquidating distributions are based on an annualized rate of 7.50% on: (i) a $10.00 per share value from May 2006 through October 2006; (ii) a remaining $6.10 per share value from November 2006 to April 2007; (iii) a remaining $3.10 per share value from May 2007 to November 2007; and (iv) a remaining $2.10 per share value beginning in December 2007. While the plan of liquidation provided that monthly distributions would terminate following the payment of liquidating distributions totaling $150,000,000, G REIT’s board of directors has determined to continue to pay monthly distributions at an annualized rate of 7.50% on the share value remaining of $2.10. Our Trustees will continue to evaluate the payment of monthly liquidating distributions on an on-going basis as our remaining assets are sold and additional special liquidating distributions are paid to beneficiaries. Every payment of liquidating distributions will be subject to the availability of cash and the discretion of our Trustees. For the years ended December 31, 2007 and 2006, G REIT paid liquidating distributions of $188,912,000, or $4.30 per share, and $201,017,000, or $4.58 per share, respectively. For the year ended December 31, 2006, G REIT declared distributions of $201,017,000, or $4.58 per share, which consisted of $8,235,000, or $0.19 per share, in distributions declared prior to G REIT stockholders approving the plan of liquidation on February 27, 2006 and $192,782,000, or $$4.39 per share, in liquidating distributions. G REIT had distributions payable of $576,000, or $0.01 per share and $0 as of December 31, 2007 and 2006.

Additionally, G REIT was required to distribute 90.0% of its REIT taxable income (excluding capital gains) on an annual basis in order to qualify as a REIT for federal income tax purposes. G REIT has historically distributed amounts in excess of its taxable income resulting in a return of capital to its stockholders. G REIT satisfied the requirements necessary to qualify as a REIT through January 28, 2008, the date that G REIT transferred its assets and liabilities to us. As a liquidating trust, we will generally not be subject to federal income taxes.

Equity Compensation Plan Information

In accordance with the plan of liquidation, all outstanding options under G REIT’s equity compensation plans were forfeited and the plans were terminated. Upon termination of G REIT’s 2004 incentive award plan, or the 2004 Plan, on February 27, 2006, the 55,000 shares of restricted stock outstanding under the 2004 Plan became fully vested. We do not have an equity compensation plan currently in place.

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Item 6.      Selected Financial Data.

The following sets forth G REIT’s selected consolidated financial and operating information on a historical basis. The following should be read with the sections titled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and the notes thereto. G REIT’s historical results are not necessarily indicative of results for any future period.

	Liquidation Basis
	As of December 31,
Selected Financial Data(1)	2007		2006		2005
STATEMENT OF NET ASSETS:
Total assets	$	121,529,000	$	526,905,000	$	887,499,000
Mortgage loans payable, including properties held for sale	$	18,840,000	$	225,836,000	$	350,402,000
Credit facility and other debt	$	—	$	—	$	60,964,000
Net assets in liquidation(2)	$	96,633,000	$	288,739,000	$	453,459,000
Net asset value per share(2)	$	2.20	$	6.57	$	10.34

	Liquidation Basis
	For the Year Ended December 31,
	2007			2006
STATEMENT OF CHANGES IN NET ASSETS:
Net assets in liquidation, beginning of period	$	288,739,000		$	453,459,000
Change in estimated costs in excess of estimated receipts during liquidation		(1,994,000	)		4,560,000
Net (decrease) increase in fair value		(1,200,000	)		23,502,000
Liquidating distributions to stockholders		(188,912,000	)		(192,782,000	)
Change in net assets in liquidation		(192,106,000	)		(164,720,000	)
Net assets in liquidation, end of period	$	96,633,000		$	288,739,000

	Going Concern Basis
	As of December 31,
Selected Financial Data(1)	2004		2003
BALANCE SHEET DATA:
Total assets	$	915,050,000	$	345,399,000
Mortgage loans payable, including properties held for sale	$	442,275,000	$	97,257,000
Credit facility and other debt	$	58,369,000	$	81,534,000
Stockholders’ equity	$	357,025,000	$	150,522,000

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	Going Concern Basis
	Years Ended December 31,
	2005			2004			2003
OPERATING DATA (BY YEAR):
General and administrative expense	$	4,006,000		$	2,419,000		$	1,287,000
Interest (including amortization of deferred financing costs)	$	2,054,000		$	1,243,000		$	293,000
Income from discontinued operations, including gain on sale	$	6,335,000		$	1,225,000		$	1,337,000
Net income (loss)	$	2,629,000		$	(1,876,000	)	$	78,000
Income (loss) per common share, basic and diluted(3):
Loss from continuing operations	$	(0.08	)	$	(0.08	)	$	(0.15	)
Income (loss) from discontinued operations	$	0.14		$	0.03		$	0.16
Net income (loss)	$	0.06		$	(0.05	)	$	0.01
Distributions declared	$	32,888,000		$	28,042,000		$	6,211,000
Distributions per common share(3)	$	0.75		$	0.75		$	0.74
Weighted-average number of shares outstanding(3):
Basic and diluted		43,867,000			37,336,000			8,243,000
OTHER DATA:
Cash flows provided by (used in) operating activities	$	19,697,000		$	39,905,000		$	7,878,000
Cash flows provided by (used in) investing activities	$	80,432,000		$	(563,218,000	)	$	(291,418,000	)
Cash flows (used in) provided by financing activities	$	(110,351,000	)	$	525,347,000		$	290,694,000
Funds from operations(3)(4)	$	30,661,000		$	33,818,000		$	5,019,000
Number of consolidated properties		24			23			11
Rentable square feet		5,650,000			5,972,000			2,146,000
Occupancy of portfolio		87.4	%		87.5	%		88.0	%

(1)	The above selected financial data should be read in conjunction with the historical consolidated financial statements and related notes appearing elsewhere in this report.
(2)	The net assets in liquidation as of December 31, 2007 and 2006 of $96,633,000 and $288,739,000, respectively, plus the cumulative liquidating distributions to G REIT’s stockholders through December 31, 2007 and 2006 of approximately $381,694,000 and $192,782,000, respectively, would result in liquidating distributions per share of approximately $10.89 and $10.96 as of December 31, 2007 and 2006, respectively.
(3)	Net income (loss) and distributions per share are based upon the weighted-average number of G REIT shares of common stock outstanding. Distributions by G REIT of the current and accumulated earnings and profits for federal income tax purposes are taxable to its stockholders as ordinary income. Distributions in excess of these earnings and profits generally are treated as a non-taxable reduction of G REIT stockholder’s basis in the shares of common stock to the extent thereof (a return of capital for tax purposes), and thereafter as taxable gain. These distributions in excess of earnings and profits will have the effect of deferring taxation of the distributions until the sale of the stockholder’s shares. For the years ended December 31, 2007, 2006, 2005, 2004, and 2003, 100.0%, 98.6%, 53.5%, 51.6%, and 53.6%, respectively, represented a return of capital for tax purposes. In order to maintain G REIT’s qualification as a REIT, G REIT had to make annual distributions to its stockholders of at least 90.0% of its REIT

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taxable income. REIT taxable income does not include net capital gains. Under certain circumstances, G REIT may have been required to make distributions in excess of cash available for distribution in order to meet the REIT distribution requirements. Distributions were determined by G REIT’s board of directors and were dependent on a number of factors, including the amount of funds available for distribution, G REIT’s financial condition, any decision by G REIT’s board of directors to reinvest funds rather than to distribute funds, its capital expenditures, the annual distribution required to maintain REIT status under the Code and other factors G REIT’s board of directors may have deemed relevant.

(4) Prior to the adoption of the plan of liquidation, one of G REIT’s objectives was to provide cash distributions to its stockholders from cash generated from operations. G REIT considered Funds From Operations, or FFO, to be an appropriate supplemental measure of a REIT’s operating performance as it is based on a net income analysis of property portfolio performance that excludes non-cash items such as depreciation. G REIT computed FFO in accordance with the White Paper on FFO approved by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT, as revised in February 2004. The White Paper defines FFO as net income or loss computed in accordance with GAAP excluding extraordinary items, as defined by GAAP, and gains and losses from sales of depreciable operating property, but including real estate related depreciation and amortization (excluding amortization of deferred financing costs and depreciation of non-real estate assets), and after adjustment for unconsolidated partnerships and joint ventures. Other REITs may use different methodologies for calculating FFO and, accordingly, G REIT’s FFO calculations may not be comparable to other REITs.

Because FFO excludes depreciation and amortization, gains and losses from property dispositions and extraordinary items, it provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities, general and administrative expenses and interest costs, providing a perspective not immediately apparent from net income. In addition, G REIT believed FFO provided useful information to the investment community about its financial performance when compared to other REITs since FFO is generally recognized as the industry standard for reporting the operations of REITs.

However, FFO should not be viewed as an alternative measure of G REIT’s operating performance since it does not reflect either depreciation and amortization costs or the level of capital expenditures and leasing costs necessary to maintain the operating performance of G REIT’s properties, which are significant economic costs and could materially impact G REIT’s results of operations.

Non-cash adjustments to arrive at FFO consisted of adjustments for, depreciation and amortization and net gain (loss) from the sale of real estate and a joint venture. For additional information, see “Funds from Operations,” which includes a reconciliation of G REIT’s GAAP net income available to its stockholders to FFO for the years ended December 31, 2005, 2004 and 2003.

Item 7.      Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion should be read in conjunction with Item 6: “Selected Financial Data” and the consolidated financial statements and notes of G REIT appearing elsewhere in this report.

Forward-Looking Statements

Historical results and trends should not be taken as indicative of future operations. Our statements contained in this report that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Actual results may differ materially from those included in the forward-looking statements. We intend those forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including in this statement for purposes of complying with those safe-harbor provisions. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies and expectations of us, are generally identifiable by use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,” “prospects,” or similar expressions. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors

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which could have a material adverse effect on our operations and future prospects on a consolidated basis include, but are not limited to: changes in economic conditions generally and the real estate market specifically; legislative and regulatory changes; the availability of capital; interest rate fluctuation; our ability to service our debt, competition; supply and demand for operating properties in our current market areas; the prospect of a continuing relationship with our advisor; generally accepted accounting principles, or GAAP; predictions of the amount of liquidating distributions to be received by our beneficiaries; statements regarding the timing of asset dispositions and the sales price we will receive for our remaining assets; the effect of the liquidation; and litigation, including, without limitation, the investigation of our advisor by the Securities and Exchange Commission, or the SEC; and the implementation and completion of the plan of liquidation.

These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. We make no representations or warranties (express or implied) about the accuracy of any such forward-looking statements contained in this report, and, unless otherwise required by law, we do not intend to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Additional information concerning us and our business, including additional factors that could materially affect our financial results, is included herein and in our other filings with the SEC.

Overview and Background

We were organized on January 22, 2008, as a liquidating trust pursuant to a plan of liquidation of G REIT, Inc., or G REIT. On January 28, 2008, in accordance with the Agreement and Declaration of Trust, or the Liquidating Trust Agreement, by and between G REIT and each of its directors, Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace and Gary T. Wescombe, or our Trustees, G REIT transferred its then remaining assets and liabilities to us. Gary T. Wescombe, the chairman of the board of directors of G REIT was appointed the chairman of the Trustees. Upon the transfer of the assets and liabilities to us, each stockholder of G REIT as of January 22, 2008, or the Record Date, automatically became the holder of one unit of beneficial interest, or a unit, in G REIT Liquidating Trust for each share of G REIT’s common stock then currently held of record by such stockholder. Our purpose is to wind up the affairs of G REIT by liquidating its remaining assets, distributing the proceeds from the liquidation of the remaining assets to the holders of units, each a beneficiary and, collectively, the beneficiaries, and paying all liabilities, costs and expenses of G REIT and G REIT Liquidating Trust.

G REIT was incorporated on December 18, 2001, under the laws of the Commonwealth of Virginia and qualified and elected to be taxed as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended, or the Code, for federal income tax purposes. On September 27, 2004, G REIT was reincorporated in the State of Maryland in accordance with the approval of its stockholders at the 2004 Annual Meeting of Stockholders. G REIT was originally formed to acquire, manage and invest in office, industrial and service real estate properties which have governmental related entities. G REIT was formed with the intent to be listed on a national stock exchange, quoted on a quotation system of a national securities association or merged with an entity whose shares are listed or quoted. In 2005, as a result of (i) then current market conditions, (ii) the increasing costs of corporate compliance (including, without limitation, all federal, state and local regulatory requirements applicable to us, including the Sarbanes-Oxley Act of 2002, as amended, or the Sarbanes-Oxley Act), and (iii) the possible need to reduce monthly distributions, the then G REIT board of directors determined that a liquidation would provide G REIT’s stockholders with a greater return on their investment over a reasonable period of time than through implementation of other alternatives considered.

As described below, on February 27, 2006, G REIT’s stockholders approved a plan of liquidation and the eventual dissolution of G REIT. Accordingly, G REIT has been engaged in an ongoing liquidation of its assets. As of December 31, 2007, G REIT owned interests in five properties aggregating a total gross leaseable area, or GLA, of 1.5 million square feet, comprised of interests in four consolidated office properties, or the consolidated properties, and one unconsolidated office property, or the unconsolidated property. As of December 31, 2007, approximately 57.2% of the total GLA of G REIT’s consolidated properties was leased and tenants with governmental related entities occupied approximately 18.1% of the total GLA. On January 28, 2008, G REIT transferred its interests in the five remaining properties to us pursuant to the Liquidating

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Trust Agreement. On March 12, 2008, we sold one of the consolidated properties, Pax River Office Park located in Lexington Park, Maryland, which comprised 17.5% of G REIT’s GLA as of December 31, 2007. Following the sale of this property, we held interests in three remaining consolidated properties and the unconsolidated property, which we refer to collectively as the “remaining assets.” For more information relating to the consolidated and unconsolidated properties, see Item 2. Properties.

G REIT conducted business and owned properties through G REIT, L.P., or its Operating Partnership, which was formed as a Virginia limited partnership in December 2001. As of December 31, 2007, G REIT was the sole general partner of the Operating Partnership and had control over the affairs of the Operating Partnership. G REIT owned 100.0% of the equity interests therein, except for the special limited partnership interest held by Grubb & Ellis Realty Investors, LLC, or Grubb & Ellis Realty Investors (formerly known as Triple Net Properties, LLC), or our advisor, which entitled our advisor to receive certain incentive distributions from net proceeds from the sale of G REIT’s remaining assets after G REIT stockholders have received their invested capital, as defined in the Operating Partnership’s limited partnership agreement, plus an 8.0% return on such invested capital. On January 28, 2008, immediately before the transfer of G REIT’s assets and liabilities to us, the Operating Partnership redeemed the special limited partnership interest held by Grubb & Ellis Realty Investors, in exchange for the right to receive 15.0% of certain distributions made by G REIT and G REIT Liquidating Trust after G REIT’s stockholders, who are know our beneficiaries, have received certain returns on their invested capital. As a result of such redemption, G REIT owned 100.0% of the outstanding partnership interests in the Operating Partnership. The Operating Partnership was dissolved in connection with the dissolution of G REIT, and all of its assets and liabilities were distributed to G REIT immediately before the transfer to us.

Liquidation of G REIT, Inc.

On December 19, 2005, the board of directors of G REIT approved a plan of liquidation which was thereafter approved by stockholders of G REIT at the Special Meeting of Stockholders held on February 27, 2006. The G REIT plan of liquidation, or the plan of liquidation, contemplates the orderly sale of all of G REIT’s assets, the payment of its liabilities, the winding up of operations and the dissolution of G REIT. G REIT engaged Robert A. Stanger & Co., Inc., or Stanger, to perform financial advisory services in connection with the plan of liquidation, including rendering opinions as to whether G REIT’s net real estate liquidation value range estimate and estimated per share distribution range were reasonable. In December 2005, Stanger opined that G REIT’s net real estate liquidation value range estimate and estimated per share distribution range were reasonable from a financial point of view. Actual values realized for assets and settlement of liabilities may differ materially from the amounts estimated by G REIT or reflected in Stanger’s opinion.

The plan of liquidation granted G REIT’s board of directors the power to sell any and all of its assets without further approval by its stockholders and provided that liquidating distributions be made to its stockholders as determined by G REIT’s board of directors. The plan of liquidation also provided for the transfer of G REIT’s remaining assets and liabilities to a liquidating trust if G REIT was unable to sell its assets and pay its liabilities within 24 months of its stockholders’ approval of the plan of liquidation (which was February 27, 2008). On October 29, 2007, G REIT’s board of directors approved the transfer of G REIT’s assets and liabilities to G REIT Liquidating Trust.

On January 22, 2008, G REIT and our Trustees, Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace, and Gary T. Wescombe, the independent directors of G REIT, entered into the Liquidating Trust Agreement in connection with our formation. Gary T. Wescombe, the chairman of the board of directors of G REIT was appointed the chairman of the Trustees. On January 28, 2008, G REIT transferred its remaining assets to, and its remaining liabilities were assumed by, our Trustees in accordance with G REIT’s plan of liquidation and the Liquidating Trust Agreement. In connection with the transfer of assets to, and assumption of liabilities by, us the stock transfer books of G REIT were closed as of the close of business on the Record Date and each share of G REIT’s common stock outstanding on the Record Date was converted automatically into a unit. Following the conversion of shares to units of beneficial interest, all outstanding shares of G REIT’s common stock were deemed cancelled. The rights of beneficiaries in their beneficial

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interests are not represented by any form of certificate or other instrument. Stockholders of G REIT on the Record Date were not required to take any action to receive units of beneficial interests. On the date of the conversion, the economic value of each unit of beneficial interest was equivalent to the economic value of a share of G REIT’s common stock. On January 28, 2008, G REIT filed a Form 15 with the SEC to terminate the registration of G REIT’s common stock under the Securities Exchange Act of 1934, as amended, or the Exchange Act, and G REIT announced that it would cease filing reports under the Exchange Act. Our Trustees will issue to beneficiaries and file with the SEC annual reports on Form 10-K and current reports on Form 8-K upon the occurrence of a material event relating to us.

Our existence will terminate upon the earliest of (i) the distribution of all of our assets in accordance with the terms of Liquidating Trust Agreement, or (ii) the expiration of a period of three years from the date assets were first transferred to us, or January 28, 2008. We may, however, extend the three-year term if our Trustees then determine that an extension is reasonably necessary to fulfill our purpose and, prior to such extension, our Trustees have requested and received certain no-action assurances from the SEC. Although we can provide no assurances, we currently expect to sell our remaining assets by September 30, 2008 and anticipate completing the plan of liquidation by December 31, 2008.

In accordance with the plan of liquidation, we continue to actively manage our property portfolio to seek to achieve higher occupancy rates, control operating expenses and maximize income from ancillary operations and services. We continually evaluate our existing portfolio and adjust our net real estate liquidation value accordingly. It is our policy that when we execute a purchase and sale agreement or become aware of market conditions or other circumstances that indicate that the present value of our properties materially differs from our expected net sales price, we will adjust our liquidation value accordingly. Under the adoption of the plan of liquidation, we will not acquire any new properties, and are focused on liquidating our remaining assets.

Our Advisor

Our advisor manages our day-to-day business affairs and assets and carries out the directives of our Trustees, pursuant to an advisory agreement, or the Advisory Agreement. Our advisor is a Virginia limited liability company that was formed in April of 1998 to advise syndicated limited partnerships, limited liability companies, and other entities, including many of our affiliates, regarding the acquisition, management and disposition of real estate assets. Our advisor advises us and certain of our affiliates with respect to the management and potential disposition of our remaining assets.

Dispositions in 2007

Pursuant to the Advisory Agreement, our advisor or its affiliate is entitled to property disposition fees in connection with our disposition of properties. Prior to the adoption of the plan of liquidation, our advisor or its affiliate was entitled to a real estate disposition fee equal to the lesser of 3.0% of the sales price or 50.0% of the sales commission that would have been paid to third-party sales broker. For properties sold after the adoption of the plan of liquidation, we anticipate paying our advisor or its affiliate a real estate disposition fee of up to 1.5% of the sales price of the property. Certain disposition fees paid to Triple Net Properties Realty, Inc., or Realty, were passed through to our advisor pursuant to an agreement between our Advisor and Realty, or the Realty-Triple Net Agreement.

Two Corporate Plaza — Houston, Texas

On January 11, 2007, G REIT sold Two Corporate Plaza located in Houston, Texas, or the Two Corporate Plaza property, to Metro Properties, LLC, an unaffiliated third party, for a sales price of $18,000,000. G REIT’s net cash proceeds from the sale were $7,127,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves. A property disposition fee of $270,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $380,000, or 2.1% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2005, G REIT’s net assets available in liquidation were increased by approximately $1,021,000 as of December 31, 2006 as a result of the sale.

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One World Trade Center — Long Beach, California

On March 22, 2007, G REIT sold One World Trade Center located in Long Beach, California, or the One World Trade Center property, to Legacy Partners Realty Fund II, LLC, an unaffiliated third party, for a sales price of $148,900,000. G REIT’s net cash proceeds from the sale were $54,165,000 after payment of the related mortgage loan, closing costs and other transaction expenses. A property disposition fee of $2,234,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $893,000, or 0.6% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $310,000 as a result of the sale.

One Financial Plaza — St. Louis, Missouri

On March 30, 2007, G REIT sold One Financial Plaza located in St. Louis, Missouri, or the One Financial Plaza property, of which G REIT owned 77.63%, to Parmenter Realty Fund III, Inc., an unaffiliated third party, for a sales price of $47,000,000. G REIT’s net cash proceeds from the sale were $11,487,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves. A property disposition fee of $705,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $380,000, or 0.81% of the sales price, was also paid to an unaffiliated broker at closing. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date increased by approximately $400,000 as a result of the sale.

824 Market Street — Wilmington, Delaware

On June 29, 2007, G REIT sold 824 Market Street located in Wilmington, Delaware, or the 824 Market Street property, to TIC investors managed by our advisor for a sales price of $37,000,000. G REIT’s net cash proceeds from the sale were $16,636,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves and collateral account. A property disposition fee of $648,000, or 1.8% of the sales price, was paid to our advisor and its affiliate. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $877,000 as a result of the sale.

North Belt Corporate Center — Houston, Texas

On June 29, 2007, G REIT sold North Belt Corporate Center located in Houston, Texas, or the North Belt Corporate Center property, to Younan Properties, Inc., an unaffiliated third party, for a sales price of $17,750,000. G REIT’s net cash proceeds from the sale were $6,952,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves and collateral account. A property disposition fee of $266,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $352,000, or 2.0% of the sales price, was also paid to Grubb & Ellis. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $69,000 as a result of the sale.

Opus Plaza at Ken Caryl — Littleton, Colorado

On July 23, 2007, G REIT sold Opus Plaza at Ken Caryl located in Littleton, Colorado, or the Opus Plaza at Ken Caryl property, to On Dow Avenue Partners, LLC, an unaffiliated third party, for a sales price of $10,400,000. G REIT’s net cash proceeds from the sale were $3,207,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves. A property disposition fee of $156,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $312,000, or 3.0% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $177,000 as a result of the sale.

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Madrona Buildings — Torrance, California

On August 2, 2007, G REIT sold Madrona Buildings located in Torrance, California, or the Madrona Buildings property, to Dominguez Industrial Center, LLC, an unaffiliated third party, for a sales price of $52,500,000. G REIT’s net cash proceeds from the sale were $15,034,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves. A property disposition fee of $788,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $412,000, or 0.8% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date increased by approximately $2,927,000 as a result of the sale.

Eaton Freeway Industrial Park — Phoenix, Arizona

On September 14, 2007, G REIT sold Eaton Freeway Industrial Park located in Phoenix, Arizona, or the Eaton Freeway Industrial Park property, to GD Eaton Freeway, LLC, an unaffiliated third party, for a sales price of $7,825,000. G REIT’s net cash proceeds from the sale were $2,326,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves. A property disposition fee of $117,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $235,000, or 3.0% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $555,000 as a result of the sale.

North Pointe Corporate Center — Sacramento, California

On September 14, 2007, G REIT sold North Pointe Corporate Center located in Sacramento, California, or the North Pointe Corporate Center property, to Amstar-34, LLC, an unaffiliated third party, for a sales price of $23,750,000. G REIT’s net cash proceeds from the sale were $23,007,000 after payment of closing costs and other transaction expenses. A property disposition fee of $356,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $285,000, or 1.2% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $1,513,000 as a result of the sale.

Bay View Plaza — Alameda, California

On November 6, 2007, G REIT sold Bay View Plaza located in Alameda, California, or the Bay View Plaza property, of which G REIT owned 97.68%, to Ellis Partners LLC, an unaffiliated third party, for a sales price of $9,700,000. G REIT’s net cash proceeds from the sale were $3,828,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves. A property disposition fee of $146,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $194,000, or 2.0% of the sales price, was also paid to Grubb & Ellis. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $967,000 as a result of the sale.

Termination of Property under Contract

On August 8, 2007, G REIT entered into an agreement, which was subsequently amended, to sell Sutter Square Galleria located in Sacramento, California, or the Sutter Square Galleria property, to an unaffiliated third party for a sales price of $7,500,000. On September 21, 2007, the agreement, as amended, was terminated.

Dispositions in 2006

600 B Street — San Diego, California

On July 18, 2006, G REIT sold 600 B Street in San Diego, California, or the 600 B Street property, to Legacy Partners Realty Fund II, LLC, an unaffiliated third party, for a sales price of $95,500,000. G REIT’s

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cash proceeds were $91,730,000 after closing costs and other transaction expenses. A property disposition fee was paid to Realty of $1,433,000, or 1.5% of the sales price, and sales commissions to unaffiliated brokers of $573,000, or 0.6% of the sales price. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date increased by approximately $755,000 as a result of the sale.

Hawthorne Plaza — San Francisco, California

On September 14, 2006, G REIT sold Hawthorne Plaza located in San Francisco, California, or the Hawthorne Plaza property, to TMG Partners, an unaffiliated third party, for a sales price of $125,000,000. G REIT’s cash proceeds were $68,261,000 after payment of the related mortgage loan, closing costs and other transaction expenses. A property disposition fee was paid to Realty of $1,875,000, or 1.5% of the sales price, and sales commissions to unaffiliated brokers of $750,000, or 0.6% of the sales price. The mortgage loan at the property of $51,719,000 was paid in full upon sale of the property. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date increased by approximately $19,960,000 as a result of the sale.

AmberOaks — Austin, Texas

On September 29, 2006, G REIT sold AmberOaks located in Austin, Texas, or the AmberOaks property, to Chase Merritt, LP, an unaffiliated third party, for a sales price of $46,837,000. G REIT’s cash proceeds were $27,584,000 after payment of the related mortgage loan, closing costs and other transaction expenses. A property disposition fee was paid to Realty of $703,000, or 1.5% of the sales price, and sales commissions to unaffiliated brokers of $611,000, or 1.3% of the sales price. The mortgage loan at the property of $18,050,000 was paid in full upon sale of the property. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date increased by approximately $5,268,000 as a result of the sale.

Brunswig Square — Los Angeles, California

On October 6, 2006, G REIT sold Brunswig Square located in Los Angeles, California, or the Brunswig Square property, to Jamison Properties Inc., an unaffiliated third party, for a sales price of $26,900,000. G REIT’s net cash proceeds from the sale were $9,639,000 after payment of the related mortgage loan, closing costs and other transaction expenses. A property disposition fee of $404,000, or 1.5% of the sales price, was paid to Realty and a sales commission of $336,000, or 1.3% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $2,062,000 as a result of the sale.

Centerpoint Corporate Park — Kent, Washington

On October 17, 2006, G REIT sold Centerpoint Corporate Park located in Kent, Washington, or the Centerpoint Corporate Park property, to Archon Acquisition, LLC, an unaffiliated third party, for a sales price of $77,525,000. G REIT’s net cash proceeds from the sale were $33,707,000 after payment of the related credit facility attributable to the Centerpoint Corporate Park property, closing costs and other transaction expenses. A property disposition fee of $1,163,000, or 1.5% of the sales price, was paid to Realty and a sales commission of $465,000, or 0.6% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date increased by approximately $17,173,000 as a result of the sale.

5508 Highway 290 — Austin, Texas

On November 14, 2006, G REIT sold 5508 Highway 290 located in Austin, Texas, or the 5508 Highway 290 property, to The Commons at Cliff Creek LTD, an unaffiliated third party, for a sales price of $10,200,000. G REIT paid $862,000 upon the disposition of the property to pay off the related credit facility and to pay closing costs and other transaction expenses. A property disposition fee of $150,000, or 1.5% of the sales price, was paid to Realty and a sales commission of $450,000, or 4.4% of the sales price, was also

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paid to unaffiliated brokers. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $705,000 as a result of the sale.

Department of Children and Family Campus — Plantation, Florida

On November 15, 2006, G REIT sold Department of Children and Family Campus located in Plantation, Florida, or the Department of Children and Family Campus property, to TIC investors managed by our advisor for a sales price of $13,000,000. G REIT’s net cash proceeds from the sale were $2,898,000 after pay-off of the related credit facility and the payment of closing costs and other transaction expenses. As compared to December 31, 2005, G REIT’s net assets available in liquidation as the sales date increased by approximately $3,147,000 as a result of the sale.

Public Ledger Building — Philadelphia, Pennsylvania

On November 22, 2006, G REIT sold Public Ledger Building located in Philadelphia, Pennsylvania, or the Public Ledger Building property, to J Grasso Properties, LLC, an unaffiliated third party for a sales price of $43,000,000. G REIT’s net cash proceeds from the sale were $13,933,000 after pay-off of the related mortgage loan and the payment of closing costs and other transaction expenses. A property disposition fee of $645,000, or 1.5% of the sales price, was paid to Realty and a sales commission of $430,000, or 1.0% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date increased by approximately $558,000 as a result of the sale.

Atrium Building — Lincoln, Nebraska

On December 15, 2006, G REIT sold Atrium Building located in Lincoln, Nebraska, or the Atrium Building property, to Sequoia Investments XVIII, LLC, an unaffiliated third party for a sales price of $5,805,000. G REIT paid $219,000 upon the disposition of the property to pay off the related mortgage loan and to pay closing costs and other transaction expenses. A property disposition fee of $87,000, or 1.5% of the sales price, was paid to Realty and a sales commission of $174,000, or 3.0% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $480,000 as a result of the sale.

Gemini Plaza — Houston, Texas

On December 29, 2006, G REIT sold Gemini Plaza located in Houston, Texas, or the Gemini Plaza property, to Manuchehr Khoshbin, an unaffiliated third party for a sales price of $17,000,000. G REIT’s net cash proceeds from the sale were $5,633,000 after pay-off of the related mortgage loan and the payment of closing costs and other transaction expenses. A property disposition fee of $255,000, or 1.5% of the sales price, was paid to Realty and a sales commission of $251,000, or 1.5% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $2,437,000 as a result of the sale.

Dispositions in 2005

525 B Street — San Diego, California

On August 10, 2005, G REIT sold 525 B Street located in San Diego, California, or the 525 B Street property, to an unaffiliated third party, for a sales price of $116,000,000. In conjunction with the sale of the 525 B Street property, G REIT paid off its existing cross-collateralized debt of $126,000,000 on the 525 B and 600 B Street properties. The sale resulted in G REIT recording a gain of $10,550,000. A property disposition fee of $1,115,000, or 1.0% of the sales price, was paid to Realty and sales commissions of $862,000, or 0.7% of the sales price, was also paid to unaffiliated brokers.

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Park Sahara — Las Vegas, Nevada

On December 20, 2005, the Park Sahara property in Las Vegas, Nevada, of which G REIT owned a 4.75% TIC interest, was sold to an unaffiliated third party for a total sales price of $17,455,000. G REIT received net cash proceeds from the sale totaling approximately $273,000 after repayment of debt, closing costs and other transaction expenses. The sale resulted in G REIT recording a net gain of approximately $132,000. A property disposition fee of $320,000, or approximately 1.8% of the total sales price, was paid to Realty and sales commissions of $639,000, or approximately 3.7% of the total sales price, was also paid to unaffiliated brokers.

Acquisitions in 2005

Pursuant to the Advisory Agreement, our advisor or its affiliate is entitled to property acquisition fees in connection with our acquisition of properties. Prior to the adoption of the plan of liquidation, our advisor or its affiliate was entitled to a real estate acquisition fee of up to 3.0% of the purchase price of a property. Certain acquisition fees paid to Realty were passed through to our advisor pursuant to the Realty-Triple Net Agreement.

G REIT acquired the following properties during 2005 (for further discussion on these properties, see Note 6 — “Real Estate Investments”):

Property	Property Location		Date Acquired		Ownership %
Opus Plaza at Ken Caryl		Littleton, Colorado		September 12, 2005		100	%
Eaton Freeway		Phoenix, Arizona		October 21, 2005		100	%

During the year ended December 31, 2005, G REIT completed the acquisition of two wholly-owned properties, adding a total of 124,000 square feet of GLA to its property portfolio. The aggregate purchase price of the two consolidated properties was $17,764,000, of which $11,700,000 was financed with mortgage debt. Realty was paid $448,000 in real estate acquisition fees. In accordance with Statement of Financial Accounting Standards, or SFAS, No. 141, Business Combinations, G REIT allocated the purchase price to the fair value of the assets acquired and the liabilities assumed, including the allocation of the intangibles associated with the in-place leases considering the following factors: lease origination costs; tenant relationships; and above or below market leases. During 2005, G REIT allocated and recorded $2,846,000 of intangible assets associated with in-place lease origination costs and tenant relationships, as well as above market leases. Such intangible assets are being amortized over the term of each of the underlying tenant leases ranging from 44 to 140 months. Total amortization of the lease intangible assets for 2005 was $109,000. On one of G REIT’s acquisitions, G REIT recorded a lease intangible liability related to the acquired below market lease which aggregated $127,000 during 2005. The lease intangible liability is being amortized over the term of the underlying tenant lease of 56 months. Amortization of $5,000 was recorded for this lease intangible liability during 2005.

Critical Accounting Policies

Use of Estimates

The preparation of financial statements in accordance with GAAP and under the liquidation basis of accounting requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets (including net assets in liquidation), liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We believe that our critical accounting policies are those that require significant judgments and estimates such as those related to revenue recognition, allowance for doubtful accounts, impairment of real estate and intangible assets, purchase price allocation, deferred assets and qualification as a REIT. These estimates are made and evaluated on an on-going basis using information that is currently available as well as various other assumptions believed to be reasonable under the circumstances. Actual results could vary from those estimates, perhaps in material adverse ways, and those estimates could be different under different assumptions or conditions.

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Liquidation Basis of Accounting

Under the liquidation basis of accounting, all assets were adjusted to their estimated fair value (on an undiscounted basis) and liabilities, including estimated costs associated with implementing the plan of liquidation, were adjusted to their estimated settlement amounts. Minority liabilities due to interests in properties held by TICs were offset against the respective properties. The valuation of real estate held for sale and investments in unconsolidated real estate is based on current contracts, estimates and other indications of sales value net of estimated selling costs. Actual values realized for assets and settlement of liabilities may differ materially from the amounts estimated. Estimated future cash flows from property operations were made based on the anticipated sales dates of our remaining assets. Due to the uncertainty in the timing of the anticipated sales dates and the cash flows therefrom, operations may differ materially from amounts estimated. These amounts are presented in the accompanying statement of net assets included in the consolidated financial statements. The net assets represent the estimated liquidation value of our remaining assets available to our beneficiaries upon liquidation. The actual settlement amounts realized for assets and settlement of liabilities may differ materially, perhaps in adverse ways, from the amounts estimated.

In accordance with the plan of liquidation, we continue to actively manage our property portfolio to seek to achieve higher occupancy rates, control operating expenses and maximize income from ancillary operations and services. We continually evaluate our existing portfolio and adjust our net real estate liquidation value accordingly. It is our policy that when we execute a purchase and sale agreement or become aware of market conditions or other circumstances that indicate that the present value of our properties materially differs from our expected net sales price, we will adjust our liquidation value accordingly. Under the adoption of the plan of liquidation, we will not acquire any new properties, and are focused on liquidating our remaining assets.

Asset (Liability) for Estimated Receipts (Costs) in Excess of Estimated (Costs) Receipts during Liquidation

Under the liquidation basis of accounting, we are required to estimate the cash flows from operations and accrue the costs associated with implementing and completing the plan of liquidation. We currently estimate that we will have operating cash inflows from our estimated receipts in excess of the estimated costs of liquidation. These amounts can vary significantly due to, among other things, the timing and estimates for executing and renewing leases, along with the estimates of tenant improvements incurred and paid, the timing of the property sales, the timing and amounts associated with discharging known and contingent liabilities and the costs associated with winding up our operations. These costs are estimated and are expected to be paid over the liquidation period.

The change in the asset for estimated receipts in excess of estimated costs during liquidation as of December 31, 2007 is as follows:

	As of December 31,			Cash Payments			Change in		As of December 31,
	2006			and (Receipts)			Estimates		2007
Assets:
Estimated net inflows from consolidated and unconsolidated operating activities	$	12,424,000		$	(9,554,000	)	$	1,158,000	$	4,028,000
Liabilities:
Liquidation costs		(5,291,000	)		1,417,000			1,871,000		(2,003,000	)
Capital expenditures		(4,092,000	)		3,012,000			102,000		(978,000	)
	$	(9,383,000	)	$	4,429,000		$	1,973,000	$	(2,981,000	)
Total asset for estimated receipts in excess of estimated costs during liquidation	$	3,041,000		$	(5,125,000	)	$	3,131,000	$	1,047,000

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The change in the asset (liability) for estimated receipts (costs) in excess of estimated (costs) receipts during liquidation as of December 31, 2006 is as follows:

	As of December 31,			Cash Payments			Change in			As of December 31,
	2005			and (Receipts)			Estimates			2006
Assets:
Estimated net inflows from consolidated and unconsolidated operating activities	$	24,390,000		$	(27,104,000	)	$	15,138,000		$	12,424,000
Liabilities:
Liquidation costs		(4,418,000	)		2,697,000			(3,570,000	)		(5,291,000	)
Liquidating distributions to stockholders		(8,226,000	)		8,235,000			(9,000	)		—
Capital expenditures		(13,265,000	)		9,804,000			(631,000	)		(4,092,000	)
		(25,909,000	)		20,736,000			(4,210,000	)		(9,383,000	)
Total asset (liability) for estimated receipts (costs) in excess of estimated (costs) receipts during liquidation	$	(1,519,000	)	$	(6,368,000	)	$	10,928,000		$	3,041,000

Accrued distributions to stockholders included in the liability for estimated costs in excess of estimated receipts during liquidation at December 31, 2005 included the estimated monthly liquidating distributions at an annualized rate of 7.50% expected to be paid pursuant to the plan of liquidation. The cash payments in distributions to stockholders include distributions paid of $8,235,000 for the first quarter of 2006. Subsequent to March 31, 2006, all distributions have been in the form of liquidating distributions to G REIT’s stockholders and recorded when approved.

Net Assets in Liquidation

The net assets in liquidation as of December 31, 2007 of $96,633,000 plus cumulative liquidating distributions through December 31, 2007 of approximately $381,694,000 (which were paid to G REIT stockholders prior to the transfer of G REIT’s assets and liabilities to us) would result in liquidating distributions to our beneficiaries per unit of approximately $10.89 per unit (of which $8.69 per share was paid to G REIT stockholders prior to the transfer of G REIT’s assets and liabilities to us). These estimates for liquidating distributions per unit include projections of costs and expenses expected to be incurred during the period required to complete the plan of liquidation. These projections could change materially based on the timing of sales, the performance of the underlying assets and any changes in the underlying assumptions of the projected cash flows.

Properties Held for Sale

Prior to the adoption of the plan of liquidation, we accounted for our properties held for sale in accordance with SFAS No. 144, Accounting for the Impairment or Disposal of Long Lived Assets, which addresses financial accounting and reporting for the impairment or disposal of long-lived assets and requires that, in a period in which a component of an entity either has been disposed of or is classified as held for sale, the income statements for current and prior periods shall report the results of operations of the component as discontinued operations. Prior to the adoption of the plan of liquidation, we reclassified amounts related to the operating properties in the consolidated financial statements to reflect the reclassification required by SFAS No. 144.

Accordingly, revenues, operating costs and expenses, and other non-operating results for the discontinued operations of all consolidated properties have been excluded from our results from continuing operations for

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all periods presented herein. The financial results for all consolidated properties are presented in our consolidated statements of operations in a single line item entitled “Income (loss) from discontinued operations.”

Revenue Recognition and Allowance for Doubtful Accounts

Prior to the adoption of the plan of liquidation, we recognized base rental income on a straight-line basis over the terms of the respective lease agreements (including rent holidays). Differences between rental income recognized and amounts contractually due under the lease agreements were credited or charged, as applicable, to rent receivable. We maintained an allowance for doubtful accounts for estimated losses resulting from the inability of tenants to make required payments under lease agreements. We also maintained an allowance for deferred rent receivables arising from the straight-lining of rents. G REIT determined the adequacy of this allowance by continually evaluating individual tenant receivables considering the tenant’s financial condition, security deposits, letters of credit, lease guarantees, if applicable, and current economic conditions. Tenant reimbursement revenue, which is comprised of additional amounts recoverable from tenants for common area maintenance expenses and certain other recoverable expenses, is recognized as revenue in the period in which the related expenses are incurred. Rental revenue is recorded on a contractual basis under the liquidation basis of accounting. In accordance with the plan of liquidation, as of December 31, 2007 and 2006, G REIT adjusted tenant receivables and deferred rent receivable to their net realizable value.

Impairment

Prior to the adoption of the plan of liquidation, G REIT’s properties were carried at the lower of historical cost less accumulated depreciation or fair value. G REIT assessed the impairment of a real estate asset when events or changes in circumstances indicated that the net book value may not be recoverable. Indicators G REIT considered important and which it believed could trigger an impairment review include the following:

•   significant negative industry or economic trend;

•   a significant underperformance relative to historical or projected future operating results; and

•   a significant change in the manner in which the asset is used.

In the event that the carrying amount of a property exceeded the sum of the undiscounted cash flows (excluding interest) that were expected to result from the use and eventual disposition of the property, G REIT would recognize an impairment loss to the extent the carrying amount exceeded the estimated fair value of the property. The estimate of expected future net cash flows was inherently uncertain and relied on subjective assumptions which were dependent upon future and current market conditions and events that affect the ultimate value of the property. It required G REIT to make assumptions related to future rental rates, tenant allowances, operating expenditures, property taxes, capital improvements, occupancy levels, and the estimated proceeds generated from the future sale of the property. G REIT did not record any impairment losses for the year ended December 31, 2005.

As of December 31, 2005, the operating properties were adjusted to fair value, less estimated costs to sell, through the adjustments to reflect the change to the liquidation basis of accounting. Subsequent to December 31, 2005, all changes in the estimated fair value of the operating properties, less estimated costs to sell, are adjusted to fair value with a corresponding change to G REIT’s net assets in liquidation.

Investment in Unconsolidated Real Estate

Prior to the adoption of the plan of liquidation, G REIT accounted for itsinvestment in unconsolidated real estate operating property using the equity method of accounting. Accordingly, G REIT reported its net equity in G REIT’s proportionate share of the total investment in unconsolidated real estate as “Investment in unconsolidated real estate” on G REIT’s consolidated balance sheet. G REIT reported its proportionate share of the total earnings of G REIT’s investment in unconsolidated real estate as “Equity in earnings of unconsolidated real estate” on G REIT’s consolidated statements of operations. Under the liquidation basis of

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accounting all of G REIT’s investments in unconsolidated real estate are recorded at estimated fair value less costs to sell.

Qualification as a REIT

G REIT has operated so as to qualify for taxation as a REIT under the Code since the taxable year ended December 31, 2002. G REIT’s qualification and taxation as a REIT depended on its ability to meet, through actual annual operating results, asset diversification, distribution levels and diversity of stock ownership, numerous requirements established under highly technical and complex Code provisions subject to interpretation.

If G REIT failed to qualify as a REIT in any taxable year, G REIT would have been subject to federal income tax, including any applicable alternative minimum tax, on its taxable income at regular corporate rates. Moreover, unless entitled to relief under specific statutory provisions, G REIT also would have been disqualified as a REIT for four taxable years following the year during which qualification was lost. G REIT continued to qualify as a REIT until its dissolution on January 28, 2008.

Factors which May Influence Future Changes in Net Assets in Liquidation

Rental Income

The amount of rental income generated by our properties depends principally on Realty’s ability to maintain the occupancy rates of currently leased space and to lease currently available space and space available from unscheduled lease terminations at the existing rental rates. Negative trends in one or more of these factors could adversely affect our rental income in future periods.

Scheduled Lease Expirations

As of December 31, 2007, our consolidated properties were 57.2% leased. 16.3% of the leased GLA expires during 2008. Our leasing strategy for 2008 and through the plan of liquidation focuses on negotiating renewals for leases scheduled to expire during the year and identifying new tenants or existing tenants seeking additional space to occupy the GLA for which we are unable to negotiate such renewals with the existing tenant. Of the leases expiring in 2008, we anticipate, but cannot assure, that approximately 96.7% of the tenants will renew for another term.

Sarbanes-Oxley Act

The Sarbanes-Oxley Act, and related laws, regulations and standards relating to corporate governance and disclosure requirements applicable to public companies have increased the costs of compliance with corporate governance, reporting and disclosure practices which are now required of us. In addition, these laws, rules and regulations create new legal bases for administrative enforcement, civil and criminal proceedings against us in case of non-compliance, thereby increasing our risk of liability and potential sanctions. If we are unable to complete the plan of liquidation by December 31, 2008, we expect that our efforts to continue to comply with these laws and regulations will involve significant costs, and any failure on our part to comply could result in fees, fines, penalties or administrative remedies against us, which could reduce and/or delay the amount of liquidating distributions to our beneficiaries under the plan of liquidation.

Changes in Net Assets in Liquidation

For the Year Ended December 31, 2007

Net assets in liquidation decreased $192,106,000, or $4.37 per share, during the year ended December 31, 2007. The primary reasons for the decrease in net assets were a decrease in real estate assets of $347,682,000, or $7.92 per share, a decrease in cash and cash equivalents of $45,827,000 or $1.04 per share, and a decrease in restricted cash of $7,256,000, or $0.17 per share, offset by a decrease in mortgage loans payable of $206,996,000, or $4.71 per share.

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The overall decrease in real estate assets during the year ended December 31, 2007 was primarily due to: (i) a decrease of $342,107,000, or $7.79 per share, due to the sale of the Two Corporate Plaza, One World Trade Center, One Financial Plaza, 824 Market Street, North Belt Corporate Center, Opus Plaza at Ken Caryl, Madrona Buildings, North Pointe Corporate Center, Eaton Freeway Industrial Park and Bay View Plaza properties; (ii) a decrease of $903,000, or $0.02 per share, as a result of the anticipated sale of the Pax River Office Park property which closed on March 12, 2008; and (iii) a decrease of $6,314,000, or $0.14 per share, in the in the expected liquidation value of certain other properties. The decrease was partially offset by an increase of $1,642,000, or $0.04 per share, in the expected liquidation value of certain other properties. The decrease in cash and cash equivalents during the year ended December 31, 2007 was primarily due to the distributions to stockholders of approximately $188,912,000, or $4.30 per share, offset by net proceeds of $139,833,000 or $3.18 per share, received on the sale of the Two Corporate Plaza, One World Trade Center, One Financial Plaza, 824 Market Street, North Belt Corporate Center, Opus Plaza at Ken Caryl, Madrona Buildings, North Pointe Corporate Center, Eaton Freeway Industrial Park and Bay View Plaza properties.

The decrease in restricted cash during the year ended December 31, 2007, was primarily due to the return of lender required reserves in conjunction with the sale of properties. The decrease in mortgage loans payable during the year ended December 31, 2007 was primarily due to the sale of our Two Corporate Plaza, One World Trade Center, One Financial Plaza, 824 Market Street, North Belt Corporate Center, Opus Plaza at Ken Caryl, Madrona Buildings, Eaton Freeway Industrial Park and Bay View Plaza properties and the payoff of the mortgage loan at the Sutter Square Galleria property.

For the Year Ended December 31, 2006

Net assets in liquidation decreased $164,720,000, or $3.75 per share, during the year ended December 31, 2006. The primary reasons for the decrease in net assets includes: (i) a decrease in real estate investments of $418,779,000, or $9.54 per share; (ii) a decrease in restricted cash of $5,733,000, or $0.13 per share; (iii) a decrease in investment in marketable securities of $7,617,000, or $0.17 per share; and (iv) a decrease in the liability for estimated costs in excess of estimated receipts during liquidation of $4,560,000, or $0.10 per share, resulting in an asset for estimated receipts in excess of estimated costs during liquidation as offset by (a) an increase in cash and cash equivalents of $69,639,000, or $1.59 per share; (b) a decrease in mortgage loans payable and amounts owed under a credit facility and other debt of $185,530,000, or $4.22 per share; (c) a decrease in accounts payable and accrued liabilities of $5,614,000, or $0.13 per share; and (d) a decrease in security deposits and prepaid rent of $2,360,000, or $0.05 per share.

The overall decrease in the value of real estate assets during the year ended December 31, 2006 includes: (i) a decrease of $400,513,000, or $9.12 per share, due to the sale of the 600 B Street, Hawthorne Plaza, AmberOaks, Brunswig Square, Centerpointe Corporate Park, 5508 Highway 290, Department of Children and Family Campus, Public Ledger Building, Atrium Building and Gemini Plaza properties during the year ended December 31, 2006; (ii) a decrease of $2,587,000, or $0.06 per share, in the anticipated sales prices of the One World Trade Center and One Financial Plaza properties pursuant to executed purchase and sale agreements; and (iii) a decrease of $20,777,000, or $0.47 per share, in the expected liquidation values of certain other properties; as offset by (a) an increase of $1,021,000, or $0.02 per share, as a result of the anticipated sale of the Two Corporate Park property which closed on January 11, 2007; (b) an increase of $39,000, or less than $0.01 per share, as a result of the anticipated sales price of the Opus Plaza at Ken Caryl property pursuant to an executed purchase and sale agreement and (c) an increase of $4,038,000, or $0.09 per share, in the expected liquidation value of certain other properties. The increase in cash and cash equivalents is primarily due to the proceeds received on the sale of our properties which closed in the fourth quarter of 2006. The decrease in restricted cash, accounts payable and accrued liabilities, security deposits and prepaid rent, mortgage loans payable and amounts owed under a credit facility is primarily due to the sale of our properties during the year ended December 31, 2006. The decrease in investment in marketable securities is due to the liquidation of investments in marketable securities during the year ended December 31, 2006.

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Results of Operations

G REIT’s operating results were primarily comprised of income derived from its portfolio of properties. Because of the adoption of the plan of liquidation, all operating activity from the properties for the year ended December 31, 2005 has been reclassified to discontinued operations.

Results of operations for the year ended December 31, 2005

	Year Ended
	December 31,
	2005
Expenses:
General and administrative	$	4,006,000
Operating loss		(4,006,000	)
Other (expense) income:
Interest (including amortization of deferred financing costs)		(2,054,000	)
Interest and dividend income		695,000
Gain on sale of marketable securities, unconsolidated real estate and joint venture		572,000
Equity in earnings of unconsolidated real estate		1,337,000
Other expense, net		(250,000	)
Loss from continuing operations before discontinued operations		(3,706,000	)
Discontinued operations:
Gain on sale of real estate		10,550,000
Loss from discontinued operations		(4,215,000	)
		6,335,000
Net income	$	2,629,000

The following is a discussion of the results of operations for the year ended December 31, 2005.

General and Administrative Expenses

General and administrative expenses of $4,006,000 consisted primarily of third party professional legal and accounting fees related to G REIT’s SEC filing requirements.

Interest Expense

Interest expense of $2,054,000 consisted primarily of interest and loan fee amortization related to a credit facility with LaSalle National Bank Association, or LaSalle, interest due to the breakage of mortgage rate lock deposits in June 2005 and September 2005 and margin loan interest due to the margin borrowings on G REIT’s Margin Securities Account with the Margin Lending Program at Merrill Lynch in 2005.

Interest and Dividend Income

Interest and dividend income of $695,000 consisted primarily of interest earned as a result of the breakage of a rate lock deposit in August 2005, interest earned on the refinancing proceeds that were held in an escrow account for two and a half months after the refinancing of one of G REIT’s properties, interest earned on a mortgage rate lock deposit in accordance with the terms of the rate lock agreement, interest and dividends earned on G REIT’s investment in marketable equity securities and interest earned on cash balances in interest bearing accounts.

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Gain on Sale of Marketable Securities, Unconsolidated Real Estate and Joint Venture

Gain on sale of marketable securities, unconsolidated real estate and joint venture of $572,000 for the year ended December 31, 2005 was due to the purchase and sale of the investments in G REIT’s Merrill Lynch account of $440,000 and the gain on sale of Park Sahara of $132,000 in 2005.

Equity in Earnings of Unconsolidated Real Estate

Equity in earnings of unconsolidated real estate of $1,337,000 consisted of G REIT’s pro rata share of the earnings at Congress Center located in Chicago, Illinois, or the Congress Center property, and Park Sahara located in Las Vegas, Nevada, or the Park Sahara property.

Other Expense

Other expense of $250,000 consisted of $309,000 in defeasance costs associated with the refinancing of Sutter Square on November 18, 2005 offset by other income of $59,000 associated with property management and accounting fee reimbursements related to our investments in the Congress Center and Park Sahara properties.

Loss from Continuing Operations

Loss from continuing operations was $3,706,000, or $0.08 per basic and diluted share, for the year ended December 31, 2005.

Loss from Discontinued Operations

Loss from discontinued operations was $4,215,000 and consisted of the net operating results of consolidated properties. In accordance with the plan of liquidation, all consolidated properties are included in discontinued operations.

Gain on Sale of Real Estate — Discontinued operations

Gain on sale of real estate was $10,550,000 for the year ended December 31, 2005 and consisted of the gain on sale of the 525 B Street property which was sold on August 10, 2005.

Net Income

Net income was $2,629,000, or $0.06 per basic and dilutive share.

Liquidity and Capital Resources

As of December 31, 2007, total assets and net assets in liquidation were $121,529,000 and $96,633,000, respectively. Our ability to meet our obligations is contingent upon the disposition of our remaining assets in accordance with the plan of liquidation. We estimate that the net proceeds from the sale of our remaining assets pursuant to the plan of liquidation will be adequate to pay our obligations; however, we cannot provide any assurance as to the prices we will receive for the disposition of our remaining assets or the net proceeds therefrom.

Current Sources of Capital and Liquidity

We anticipate, but can not assure, that our cash flow from operations and sales of our remaining assets will be sufficient during the liquidation period to fund our cash needs for payment of expenses, capital expenditures, recurring debt service payments and repayment of debt maturities. Due to the uncertain timing of property sales and the maturity of certain debt obligations coming due, we may need to refinance one or more of our properties and/or request extensions of the terms of existing financing agreements.

The plan of liquidation gives our Trustees the power to sell any and all of our remaining assets without further approval by our beneficiaries and provides that liquidating distributions be made to our beneficiaries as

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determined at the discretion of our Trustees. Although we can provide no assurances, we currently expect to sell all of our remaining assets by September 30, 2008 and anticipate completing the plan of liquidation by December 31, 2008.

Factors Which May Influence Future Sources of Capital and Liquidity

SEC Investigation

On September 16, 2004, our advisor advised G REIT that it learned that the SEC Los Angeles Enforcement Division, or the SEC Staff, was conducting an investigation referred to as “In the matter of Triple Net Properties, LLC.” The SEC has requested information from our advisor relating to disclosure in public and private securities offerings sponsored by our advisor and its affiliates, or the Triple Net securities offerings (including offerings by G REIT). The SEC has requested financial and other information regarding the Triple Net securities offerings and the disclosures included in the related offering documents.

Our advisor is engaged in settlement negotiations with the SEC Staff regarding this matter. Based on these negotiations, our advisor believes that the conclusion to this matter will not result in a material adverse affect to its results of operations, financial condition or ability to conduct our business. The settlement negotiations are continuing, and any settlement negotiated with the SEC Staff must be approved by the Commissioners. Since the matter is not concluded, it remains subject to the risk that the SEC may seek additional remedies, including substantial fines and injunctive relief against our advisor that, if obtained, could materially adversely affect our advisor’s ability to perform its duties to us. The matters that are the subject of this investigation could also give rise to claims against our advisor by investors in its existing real estate investment programs which could adversely affect our advisor’s performance with respect to us. At this time, we cannot assess how or when the outcome of the matter will be ultimately determined and its impact on us. Therefore, at this time, we have not accrued any loss contingencies in accordance with SFAS No. 5, Accounting for Contingencies.

Prior Performance Tables

In connection with G REIT’s initial and second public offerings of common stock conducted through “best efforts” offerings from July 22, 2002 through April 30, 2004, G REIT disclosed the prior performance of all public and private investment programs sponsored by our advisor. Our advisor determined that there were certain errors in those prior performance tables. In particular, the financial information in the tables was stated to be presented on a GAAP basis. Generally the tables for the public programs were not presented on a GAAP basis and the tables for the private programs were prepared and presented on a tax or cash accounting basis. Moreover, a number of the prior performance data figures were themselves erroneous, even as presented on a tax or cash basis. In particular, certain programs sponsored by our advisor have invested either along side or in other programs sponsored by our advisor. The nature and results of these investments were not fully and accurately disclosed in the tables. In addition, for the private programs certain calculations of depreciation and amortization were not on an income tax basis for limited liability company investments; certain operating expenses were not reflected in the operating results; and monthly mortgage and principal payments were not reported. In general, the resulting effect is an overstatement of our advisor’s program and aggregate portfolio operating results. At this time there is no litigation related to the prior performance tables.

Revised prior performance tables reflecting corrected numbers and disclosures from those initially included in G REIT’s prospectuses dated July 22, 2002 and January 23, 2004 were included in G REIT’s definitive proxy statement and G REIT’s Current Report on Form 8-K filed with the SEC on January 13, 2006.

Debt Financing

The Western Place I & II property is required by the terms of the applicable loan documents to meet certain minimum loan to value, debt service coverage, performance covenants and other requirements. On November 1, 2007, the $24,000,000 secured mortgage loan with LaSalle on the Western Place I & II property, of which we own 78.5%, matured. As a result, as of December 31, 2007, G REIT was in default on the

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mortgage loan with LaSalle. On February 26, 2008, we, along with our co-owners, or the Western Place Owners, refinanced the Western Place I & II property’s mortgage loan with Wachovia Bank, National Association, or Wachovia, in the principal amount of $28,000,000. The loan matures on February 28, 2009, and provides for monthly interest-only payments due on the first day of each calendar month, beginning April 1, 2008. At the option of the Western Place Owners, the loan bears interest at per annum rates equal to: (a) 30-day LIBOR plus 1.65% per annum; or (b) the Prime Rate, as announced by Wachovia from time to time as its prime rate. If any monthly installment that is due is not received by Wachovia on or before the 15th day of each month, the loan provides for a late charge equal to 4.0% of such monthly installment. In the event of a default, the loan also provides for a default interest rate of 4.0% per annum plus the greater of the LIBOR Rate or the Prime Rate. The loan may be prepaid in whole or in part, without paying a prepayment premium. The loan documents contain certain customary representations, warranties, covenants and indemnities. In addition, the Western Place Owners entered into an interest rate swap agreement, or the ISDA Agreement, in conjunction with refinance of the Western Place I & II property. As a result of the ISDA Agreement, the Western Place loan bears interest at a nominal fixed rate of 6.21% per annum from February 26, 2008 through February 28, 2009; and provides for monthly interest-only payments due on the first business day of each calendar month commencing on April 1, 2008. As a result of the refinancing, the Western Place Owners borrowed $24,250,000. In addition, there is $3,750,000 available for general tenant improvements, leasing commissions and capital improvements under the mortgage loan, which shall be released as work or leasing costs are incurred and evidence of such costs is provided to the satisfaction of lender. As of March 24, 2008, there was $24,250,000, of which $19,036,000 represents our pro rata share, outstanding on the mortgage loan with Wachovia.

The composition of G REIT’s aggregate debt balances as of December 31, 2007 and 2006 (liquidation basis) were as follows:

					Weighted-
					Average
	Total Debt				Interest Rate
	As of December 31,				As of December 31,
	2007		2006		2007			2006
	(Liquidation basis)
Mortgage debt	$	18,840,000	$	225,836,000		8.13	%		5.65	%
Fixed rate and variable rate
Fixed rate	$	—	$	196,321,000		—			5.32	%
Variable rate	$	18,840,000	$	29,515,000		8.13	%		7.86	%

As of December 31, 2007, interest payments on the mortgage debt was variable and the mortgage debt was exposed to fluctuations on the one-month LIBOR rate.

G REIT had restricted cash balances of $1,299,000 as of December 31, 2007 that were held as credit enhancements and as reserves for property taxes, capital expenditures and capital improvements in connection with G REIT’s loan portfolio. When we repay the loans, the restricted balances that are outstanding at that time will become available to us as unrestricted funds.

Other Liquidity Needs

G REIT was required to distribute 90.0% of its REIT taxable income, excluding capital gains, on an annual basis in order to qualify as a REIT for federal income tax purposes. All such distributions were at the discretion of G REIT’s board of directors. The amount of distributions depended on G REIT’s funds from operations, financial condition, capital requirements, annual distribution requirements under the REIT provisions of the Code and other factors G REIT’s board of directors deemed relevant. G REIT met its REIT distribution requirements for 2007. Amounts accumulated for distribution to G REIT’s stockholders were invested primarily in interest-bearing accounts and short-term interest-bearing securities, which were consistent with G REIT’s intention to maintain its qualification as a REIT. Such investments included, for example, certificates of deposit and interest-bearing bank deposits.

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We believe that we will have sufficient capital resources to satisfy our liquidity needs during the liquidation period. G REIT made and declared liquidating distributions to its stockholders in the aggregate amount of $381,694,000, or $8.69 per share, during the year ended December 31, 2007. The source for payment of these distributions was funds from operating activities and proceeds from the sales of properties. While the plan of liquidation provided that monthly distributions would terminate following the payment of liquidating distributions totaling $150,000,000, G REIT’s board of directors determined to continue to pay monthly distributions at an annualized rate of 7.50% on the share value remaining of $2.10. Our Trustees will continue to evaluate the payment of monthly liquidating distributions on an on-going basis as more properties are sold and additional special liquidating distributions are paid to beneficiaries. Every payment of liquidating distributions will be subject to the availability of cash and the discretion of our Trustees.

As of December 31, 2007, G REIT had $2,981,000 of commitments and expenditures during the liquidation period comprised of the following: $2,003,000 of liquidation costs and $978,000 of capital expenditures. However, there can be no assurance that we will not exceed the amounts of these estimated expenditures or that we will be able to obtain additional sources of financing on commercially favorable terms, or at all.

A material adverse change in the net cash provided by operating activities or net proceeds expected from the liquidation of real estate assets may affect our ability to fund these items and may affect our ability to satisfy the financial performance covenants under our mortgages. If we fail to meet our financial performance covenants and are unable to reach a satisfactory resolution with the lenders, the maturity dates for the secured notes could be accelerated. Any of these circumstances could adversely affect our ability to fund working capital, liquidation costs and unanticipated cash needs.

Liquidating distributions to our beneficiaries will be determined by our Trustees in their sole discretion and are dependent on a number of factors, including the amount of funds available for distribution, our financial condition, our capital expenditures and other factors our Trustees may deem relevant.

The stated range of stockholder distributions disclosed in the plan of liquidation are estimates only and actual results may be higher or lower than estimated. The potential for variance on either end of the range could occur for reasons including, but not limited to: (i) unanticipated costs that could reduce net assets actually realized; (ii) winding up our business significantly faster than anticipated which could eliminate some of the anticipated costs and result in higher net liquidation proceeds; (iii) a delay in our liquidation that could result in higher than anticipated costs and lower net liquidation proceeds; and (iv) change in circumstances, such as, the discovery of new environmental issues or loss of a tenant that may that may result in actual net proceeds realized from the sale of assets being significantly lower than currently estimated.

G REIT’s distributions of amounts in excess of its taxable income have resulted in a return of capital to G REIT stockholders. The income tax treatment for distributions reportable for the years ended December 31, 2007, 2006 and 2005, was as follows:

	December 31,
	2007				2006				2005
Ordinary income	$	—	—		$	2,829,000	1.40	%	$	3,333,000	10.12	%
Capital gain		—	—			—	—			11,963,000	36.34	%
Return of capital		—	—			2,661,000	1.32	%		17,628,000	53.54	%
Liquidating distributions		190,010,000	100.00	%		196,597,000	97.28	%		—	—
	$	190,010,000	100.00	%	$	202,087,000	100.00	%	$	32,924,000	100.00	%

Subsequent to March 31, 2006, approximately $188,912,000, or $4.30 per share, and $192,782,000, or $4.39 per share, of liquidating distributions to G REIT stockholders were paid for the years ended December 31, 2007 and 2006, respectively, and are treated by stockholders as proceeds from the sale of their stock.

Subject to our Trustees’ determinations and in accordance with the plan of liquidation, we expect to meet our liquidity requirements through the completion of the liquidation, through retained cash flow, dispositions

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of assets, and additional long-term secured and unsecured borrowings. We do not intend to reserve funds to retire existing debt upon maturity. We will instead, seek to refinance such debt at maturity or retire such debt through the disposition of the underlying property.

If we experience lower occupancy levels and reduced rental rates, reduced revenues as a result of asset sales, increased capital expenditures and leasing costs compared to historical levels due to competitive market conditions for new and renewal leases, the effect would be a reduction of net cash provided by operating activities. If any or all of these events occur and if our Trustees continue to declare distributions to our beneficiaries at current levels, we may experience a cash flow deficit in subsequent periods. In connection with such a shortfall in net cash available, we may seek to obtain capital to pay distributions by means of secured debt financing through one or more third parties. This estimate is based on various assumptions which are difficult to predict, including the levels of leasing activity at year end and related leasing costs. Any changes in these assumptions could adversely impact our financial results and our ability to fund working capital and our other unanticipated cash needs.

Cash Flows

For the Year Ended December 31, 2005

Cash flows provided by operating activities was $19,697,000 for the year ended December 31, 2005.

Cash flows provided by investing activities were $80,432,000 for the year ended December 31, 2005 and were primarily related to the sale of the 525 B Street property in August 2005 offset by increases in capital expenditures, the purchase of the Opus Plaza and Eaton Freeway properties in September 2005 and October 2005, respectively, and increases in restricted cash.

Cash flows used in financing activities were $110,351,000 for the year ended December 31, 2005. The use of cash was primarily for repayments of amounts borrowed under the credit facility and mortgage debt. In addition, cash distributions paid to G REIT stockholders in 2005 were $32,888,000.

As a result of the above, cash and cash equivalents for the year ended December 31, 2005 was $7,345,000.

Capital Resources

General

We derive substantially all of our revenues from tenants under leases at our properties. Our operating cash flow, therefore, depends materially on the rents that we are able to charge to our tenants and the ability of these tenants to make their rental payments.

The primary uses of cash are to fund distributions to our beneficiaries and for debt service. We may also regularly require capital to invest in our existing portfolio of operating assets in connection with routine capital improvements and leasing activities, including funding tenant improvements, allowances and leasing commissions. The amounts of the leasing-related expenditures can vary significantly depending on negotiations with tenants and the willingness of tenants to pay higher base rents over the life of the leases.

In accordance with the plan of liquidation, we anticipate our source for the payment of our liquidating distributions to our beneficiaries to be primarily from the net proceeds from the sale of our remaining assets and funds from operating activities. We will require up to $978,000 for the year ended December 31, 2008 for capital expenditures, including, without limitation, tenant and/or capital improvements and lease commissions. We intend to use proceeds from the sale of properties to provide funds to the extent the reserves on deposit with the lender of $1,299,000 as of December 31, 2007, are not sufficient or cannot be used for these expenditures.

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Financing

Total debt decreased as a result of the sale of ten properties during the year ended December 31, 2007 that had mortgage debt that was paid off upon sale of the property. As of December 31, 2007 and December 31, 2006, mortgage loans payable secured by property held for sale balances were $18,840,000 and $225,836,000, respectively.

The credit facility with LaSalle matured on January 30, 2006. On January 25, 2006, G REIT, as the general partner for G REIT, L.P., entered into a Second Amended and Restated Credit Agreement, or Amended Credit Agreement, for the credit facility in the amount of $58,369,000, with lenders: (i) LaSalle; (ii) Bank of America, National Association, or Bank of America; and (iii) Citizens Financial Bank, or Citizens Financial; with LaSalle acting as agent for the lenders. The credit facility matured on January 30, 2007. Advances under this credit facility were collateralized by the mortgaged properties and proceeds thereof. Advances bore interest, at G REIT’s election, at the prime rate or the one-month LIBOR rate plus a margin of 2.25%, when G REIT met certain conditions, which included no default on advances, and full compliance with the other covenants. The advances were subject to a floor rate of 3.5% and required interest only payments on a monthly basis.

The Amended Credit Agreement contained covenants that were comparable to those of other real estate investment trusts and facilitated the plan of liquidation which was thereafter approved by G REIT stockholders on February 27, 2006. These covenants included, among others: a limitation on the incurrence of additional indebtedness; a limitation on mergers, investments, acquisitions, and dividend distributions; and maintenance of specified financial ratios. The Amended Credit Agreement contained normal events of default for an agreement of this type. The nonpayment of any outstanding principal, interest, fees or amounts due under the credit facility and the failure to perform or observe covenants in the loan documents, among other things, could have resulted in events of default. Additionally, under the terms of the Amended Credit Agreement, at no time during the loan should the borrowing base be made up of less than two properties or G REIT minimum net worth equal to less than $150,000,000.

On October 17, 2006, G REIT entered into a First Amendment to Second Amended and Restated Credit Agreement, or the Amendment. The material terms of the Amendment provided for the following: (i) the release of the Centerpoint Corporate Park property as a mortgaged property under the terms of the Amended Credit Agreement; (ii) that upon receipt of proceeds, or the Proceeds, from the Release Price (as defined in the Amended Credit Agreement) resulting from the sale of Centerpoint Corporate Park property, Bank of America and Citizens Financial Bank would have received full payment of their Commitments (as defined in the Amended Credit Agreement); (iii) and that upon receipt of the Proceeds, Bank of America and Citizens Financial should no longer serve as lenders under the Credit Agreement and should each deem any promissory notes or note assumptions they hold as paid in full and returned to G REIT. On October 17, 2006, G REIT paid down $39,900,000 on the credit facility in conjunction with the sale of the Centerpoint Corporate Park property. With the $39,900,000 payment, Bank of America and Citizens Financial received full repayment of their commitments and LaSalle received the remaining balance of the Release Price payment. As a result, the principal balance of LaSalle’s commitment was $18,469,000 and Bank of America and Citizens Financial were no longer lenders under the Credit Agreement. On November 14, 2006, G REIT paid down $9,588,000 on the credit facility in conjunction with the sale of the 5508 Highway 290 property. G REIT paid off the remaining principal balance on the credit facility of $8,881,000 in conjunction with the sale of the Department of Children and Family Campus property on November 15, 2006 and terminated the credit facility.

As of December 31, 2007, G REIT had $30,985,000 in cash and cash equivalents. In addition, G REIT has restricted cash balances of $1,299,000 as of December 31, 2007 that are held as credit enhancements and as reserves for property taxes, capital expenditures and capital improvements in connection with our loan portfolio. When we repay the loans, the restricted balances that are outstanding at that time will become available to us as unrestricted funds.

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Unconsolidated Debt

Total mortgage debt on the unconsolidated property, the Congress Center property, was $96,101,000 and $97,308,000 as of December 31, 2007 and 2006, respectively. Our share of the unconsolidated debt, based on ownership percentage, was $28,830,000 and $29,192,000 as of December 31, 2007 and 2006, respectively.

On December 21, 2006, Realty received a termination notice from Employer’s Reinsurance Corporation notifying Realty of its intent to exercise its option to terminate its lease effective January 1, 2008 at the Congress Center property. Effective January 1, 2008, Employer’s Reinsurance Corporation’s lease was terminated. Pursuant to the Property Reserves Agreement with the lender under our mortgage debt, the lender was entitled to receive an early termination fee penalty of $3,800,000 from the borrower (all the co-owners of the Congress Center property) to be placed in a reserve account controlled by the lender. In addition, the lender was entitled to receive $225,000 on a monthly basis beginning January 1, 2007 and continuing through and including the payment date occurring on December 1, 2007 from the borrower. Beginning January 1, 2008 and continuing through and including the payment date occurring on December 1, 2011, the lender is entitled to receive $83,000 on a monthly basis from the borrower. In the event that the Congress Center property does not generate sufficient funds from operations to satisfy the monthly reserve payments to the lender, it is anticipated that the borrower will obtain an unsecured loan from our advisor or its affiliates or NNN 2002 Value Fund, LLC, or our affiliate co-owner, will advance the required amounts to the lender on behalf of the borrower. In January 2007, Employer’s Reinsurance Corporation paid $3,773,000 to the lender as an early termination fee penalty pursuant to their lease agreement. G REIT, along with T REIT Liquidating Trust (successor of T REIT, Inc.) and our affiliate co-owner paid the remaining $27,000 of the early termination fee penalty owed to the lender. As of December 31, 2007, G REIT has advanced $273,000 to the lender for the reserves associated with the early lease termination. It is anticipated that upon the sale of the Congress Center property, we, along with T REIT Liquidating Trust (successor of T REIT, Inc.) and our affiliate co-owner, will receive repayment of any advances made to the lender for reserves. All payments to the lender are to be placed in a reserve account to be held by the lender for reimbursement to the borrower for tenant improvement and leasing commissions incurred in connection with re-leasing the space. Realty has begun marketing efforts to re-lease the space as a result of the lease termination on January 1, 2008; however, our failure to replace this tenant may reduce or delay our liquidating distributions to our beneficiaries.

The Congress Center property is required by the terms of the applicable loan documents to meet certain minimum loan to value, performance covenants and other requirements. As of December 31, 2007, the Congress Center property was in compliance with all such covenants.

Insurance

Property Damage, Business Interruption, Earthquake and Terrorism

The insurance coverage provided through third-party insurance carriers is subject to coverage limitations. Should an uninsured or underinsured loss occur, we could lose all or a portion of our investment in, and anticipated cash flows from, one or more of our properties. In addition, there can be no assurance that third-party insurance carriers will be able to maintain reinsurance sufficient to cover any losses that may be incurred.

Debt Service Requirements

One of our principal liquidity needs is the payment of interest and principal on outstanding indebtedness, which includes mortgage payments on one of our properties. As of December 31, 2007, the Western Place I & II property, of which we own 78.5%, was subject to an existing mortgage, which had an aggregate principal amount outstanding of $24,000,000. G REIT’s total debt consisted of $18,840,000 on a liquidation basis, of variable rate debt at a weighted-average interest rate of 8.13% per annum. As of December 31, 2007, the weighted-average interest rate on G REIT’s outstanding debt was 8.13% per annum.

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The scheduled principal payments for the next five years, as of December 31, 2007 (liquidation basis) are as follows:

Year	Amount
2008	$	18,840,000
2009		—
2010		—
2011		—
2012		—
Thereafter		—
	$	18,840,000

Contractual Obligations

The following table provides information with respect to the maturities, including scheduled principal repayments of secured debt, as well as scheduled interest payments of variable rate debt as of December 31, 2007. It also provides information about the minimum commitments due in connection with ground lease obligations as of December 31, 2007. The table does not reflect any available extension options.

	Payments Due by Period (Liquidation Basis)
	Less Than						More Than
	1 Year		1-3 Years		3-5 Years		5 Years
State	(2008)		(2009-2010)		(2011-2012)		(After 2012)		Total
Principal payments — variable rate debt	$	18,840,000	$	—	$	—	$	—	$	18,840,000
Interest payments — variable rate debt (based on rate in effect as of December 31, 2007)		1,202,000		—		—		—		1,202,000
Ground lease obligations(1)		—		—		—		—		—
Tenant improvement and lease commission obligations		84,000		—		—		—		84,000
Total	$	20,126,000	$	—	$	—	$	—	$	20,126,000

(1) The Sutter Square Galleria property is subject to a ground lease expiring in 2040 with one 10-year option period thereafter. Future minimum rents to be paid under this non-cancelable operating lease are computed at 12.5% of gross rents, as defined in the ground lease agreement.

Off-Balance Sheet Arrangements

There are no off-balance sheet transactions, arrangements or obligations (including contingent obligations) that have, or are reasonably likely to have, a current or future material effect on our financial condition, changes in the financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Inflation

Until we complete the plan of liquidation, we will be exposed to inflation risk as income from long-term leases at our properties is expected to be the primary source of our cash flows from operations. The majority of our tenant leases provide protection from the impact of inflation. These provisions include rent steps, reimbursement billings for operating expense pass-through charges, real estate tax and insurance reimbursements on a per square foot allowance. However, due to the long-term nature of the leases, among other factors, the leases may not re-set frequently enough to cover inflation.

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Funds from Operations

We define Funds from Operations, or FFO, a non-GAAP measure, consistent with the standards established by the White Paper on FFO approved by the Board of Governors of the National Association of Real Estate Investment Trust, or NAREIT, as revised in February 2004. The White Paper defines FFO as net income or loss computed in accordance with GAAP, excluding gains or losses from sales of property but including asset impairment write downs, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated joint ventures are calculated to reflect FFO.

We consider FFO to be an appropriate supplemental measure of a REIT’s operating performance as it is based on a net income analysis of property portfolio performance that excludes non-cash items such as depreciation. The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time. Since real estate values historically rise and fall with market conditions, presentations of operating results for a REIT, using historical accounting for depreciation, could be less informative. The use of FFO is recommended by the REIT industry as a supplemental performance measure.

We believe our FFO reporting for G REIT complies with NAREIT’s policy described above.

Presentation of this information is intended to assist the reader in comparing the operating performance of different REITs, although it should be noted that not all REITs calculate FFO the same way, so comparisons with other REITs may not be meaningful. Furthermore, FFO is not necessarily indicative of cash flow available to fund cash needs and should not be considered as an alternative to net income as an indication of our performance.

The following is the calculation of FFO for the years ended December 31, 2005, 2004 and 2003:

	Years Ended December 31,
	2005			2004			2003
Net income	$	2,629,000		$	(1,876,000	)	$	78,000
Add:
Depreciation and amortization — discontinued operations		38,519,000			34,730,000			3,718,000
Depreciation and amortization — unconsolidated properties		195,000			1,457,000			1,223,000
Less:
Gain on sale of real estate and joint venture (net of related income tax)		(10,682,000	)		(493,000	)		—
Funds from operations	$	30,661,000		$	33,818,000		$	5,019,000
Weighted-average common shares outstanding — basic and diluted		43,867,000			37,336,000			8,243,000
Gain on the sale of investments included in net income and FFO	$	440,000		$	251,000		$	—

Subsequent Events

Plan of Liquidation

On January 28, 2008, G REIT transferred its assets to, and its liabilities were assumed by, us in accordance with the plan of liquidation and the Liquidating Trust Agreement.

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Real Estate Investments

Dispositions in 2008

Pax River Office Park — Lexington, Maryland

On March 12, 2008, we sold the Pax River Office Park property located in Lexington, Maryland to Hampshire Global Partners, LLC, an unaffiliated third party, for a sales price of $14,475,000. Our net cash proceeds from the sale were $13,984,000 after payment of closing costs and other transaction expenses. A sales commission of $253,000, or 1.7% of the sales price, was paid to an unaffiliated broker. As compared to December 31, 2006, our net assets available in liquidation as of the sales date decreased by approximately $903,000, or $0.02 per share, as a result of the sale.

Mortgage Loans Payable Secured by Properties Held for Sale

On February 26, 2008, we, along with our co-owners, or the Western Place Owners, refinanced the Western Place I & II property’s mortgage loan with Wachovia, in the principal amount of $28,000,000. The loan matures on February 28, 2009, and provides for monthly interest-only payments due on the first day of each calendar month, beginning April 1, 2008. At the option of the Western Place Owners, the loan bears interest at per annum rates equal to: (a) 30-day LIBOR plus 1.65% per annum; or (b) the Prime Rate, as announced by Wachovia from time to time as its prime rate. If any monthly installment that is due is not received by Wachovia on or before the 15th day of each month, the loan provides for a late charge equal to 4.0% of such monthly installment. In the event of a default, the loan also provides for a default interest rate of 4.0% per annum plus the greater of the LIBOR Rate or the Prime Rate. The loan may be prepaid in whole or in part, without paying a prepayment premium. The loan documents contain certain customary representations, warranties, covenants and indemnities. In addition, the Western Place Owners entered into an interest rate swap agreement, or the ISDA Agreement, in conjunction with refinance of the Western Place I & II property. As a result of the ISDA Agreement, the Western Place loan bears interest at a nominal fixed rate of 6.21% per annum from February 26, 2008 through February 28, 2009; and provides for monthly interest-only payments due on the first business day of each calendar month commencing on April 1, 2008. As a result of the refinancing, the Western Place Owners borrowed $24,250,000. In addition, there is $3,750,000 available for general tenant improvements, leasing commissions and capital improvements under the mortgage loan, which shall be released as work or leasing costs are incurred and evidence of such costs is provided to the satisfaction of lender. As of March 24, 2008, there was $24,250,000, of which $19,036,000 represents our pro rata share, outstanding on the mortgage loan with Wachovia.

Unconsolidated Debt

In connection with the transfer of assets and liabilities from G REIT to us on January 28, 2008, we may be required to pay a transfer fee of up to $288,000 with respect to the assumption of certain debt obligations by us related to the unconsolidated property. We are in the process of working with the lender to finalize the terms of the transfer of this obligation.

Unconsolidated Debt Due to Related Parties

On February 1, 2008, the Congress Center property, of which we own 30.0%, entered into an unsecured loan with NNN Realty Advisors, Inc., or NNN Realty Advisors, evidenced by an unsecured promissory note in the principal amount of $225,000. The unsecured note provides for a maturity date of July 31, 2008, bears interest at a fixed rate of 7.64% per annum and requires monthly interest-only payments for the term of the unsecured note.

Recently Issued Accounting Pronouncements

In July 2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes, or FIN No. 48. This interpretation, among other things, creates a two-step approach for evaluating uncertain tax positions. Recognition (step one) occurs when an enterprise concludes that a tax position, based solely on its

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technical merits, is more-likely-than-not to be sustained upon examination. Measurement (step two) determines the amount of benefit that more-likely-than-not will be realized upon settlement. Derecognition of a tax position that was previously recognized would occur when a company subsequently determines that a tax position no longer meets the more-likely-than-not threshold of being sustained. FIN No. 48 specifically prohibits the use of a valuation allowance as a substitute for derecognition of tax positions, and it has expanded disclosure requirements. FIN No. 48 is effective for fiscal years beginning after December 15, 2006, in which the impact of adoption should be accounted for as a cumulative-effect adjustment to the beginning balance of retained earnings. The adoption of FIN No. 48 did not have a material impact on G REIT’s or our consolidated financial statements.

In September 2006, the FASB issued Statement of Financial Accounting Standards, or SFAS, No. 157, Fair Value Measurement, or SFAS No. 157. SFAS No. 157 defines fair value, establishes a framework for measuring fair value in accordance with GAAP, and expands disclosures about fair value measurements. The provisions of SFAS No. 157 are effective for fiscal years beginning after November 15, 2007. G REIT adopted SFAS No. 157 on January 1, 2008. The adoption of SFAS No. 157 did not have a material effect on G REIT’s or our consolidated financial statements.

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities, or SFAS No. 159. SFAS No. 159 permits entities to choose to measure many financial instruments and certain other items at fair value. The objective of the guidance is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. SFAS No. 159 is effective as of the beginning of the first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of the fiscal year beginning on or before November 15, 2007, provided the provisions of SFAS No. 157 are applied. G REIT adopted SFAS No. 159 on a prospective basis on January 1, 2008. The adoption of SFAS No. 159 did not have a material impact on G REIT’s or our consolidated financial statements.

In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities, or SFAS No. 161. SFAS No. 161 is intended to improve financial reporting about derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entity’s financial position, financial performance, and cash flows. SFAS No. 161 achieves these improvements by requiring disclosure of the fair values of derivative instruments and their gains and losses in a tabular format. It also provides more information about an entity’s liquidity by requiring disclosure of derivative features that are credit risk — related. Finally, it requires cross-referencing within footnotes to enable financial statement users to locate important information about derivative instruments. SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. The adoption of SFAS No. 161 is not expected to have a material impact on our consolidated financial statements.

Item 7A.      Quantitative and Qualitative Disclosures About Market Risk.

We are exposed to interest rate changes primarily as a result of our long-term debt used to maintain liquidity and fund capital expenditures and expansion of our real estate investment portfolio and operations. Our interest rate risk objectives are to limit the impact of interest rate changes on earnings and cash flows and to lower our overall borrowing costs. To achieve these objectives we borrow primarily at fixed rates or variable rates with the lowest margins available and, in some cases, with the ability to convert variable rate debt to fixed rate debt. We may enter into derivative financial instruments such as interest rate swaps, caps and treasury locks in order to seek to mitigate our interest rate risk on a related financial instrument. We do not enter into derivative or interest rate transactions for speculative purposes.

Our interest rate risk is monitored using a variety of techniques. The table below presents, as of December 31, 2007 (on a liquidation basis), the principal amounts and weighted-average interest rates by year of expected maturity to evaluate the expected cash flows and sensitivity to interest rate changes.

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	Expected Maturity Date
	2008			2009		2010		2011		2012		Thereafter		Total			Fair Value
Variable rate debt	$	18,840,000		$	—	$	—	$	—	$	—	$	—	$	18,840,000		$	18,840,000
Average interest rate on maturing debt (based on rate in effect as of December 31, 2007)		8.13	%		—		—		—		—		—		8.13	%

The weighted-average interest rate of G REIT’s mortgage debt as of December 31, 2007 was 8.13% per annum. As of December 31, 2007, G REIT’s mortgage debt consisted of $18,840,000 of variable rate debt at a variable interest rate of 8.13% per annum. An increase in the variable interest rate on such mortgage debt constitutes a market risk. As of December 31, 2007, for example a 0.50% increase in LIBOR would have decreased our overall net assets by $94,000, or less than 0.10%.

Our exposure to market changes in interest rates is similar to that which G REIT faced as of December 31, 2006. The table below presents, as of December 31, 2006 (on a liquidation basis), the principal amounts and weighted-average interest rates by year of expected maturity to evaluate the expected cash flows and sensitivity to interest rate changes.

	Expected Maturity Date
	2007			2008			2009			2010			2011			Thereafter			Total			Fair Value
Fixed rate debt	$	10,257,000		$	964,000		$	24,969,000		$	1,556,000		$	23,994,000		$	134,581,000		$	196,321,000		$	196,321,000
Average interest rate on maturing debt		5.89	%		5.37	%		5.47	%		5.32	%		5.21	%		5.27	%		5.32	%
Variable rate debt	$	23,912,000		$	77,000		$	5,526,000		$	—		$	—		$	—		$	29,515,000		$	29,515,000
Average interest rate on maturing debt (based on rate in effect as of December 31, 2006)		7.98	%		7.35	%		7.35	%		—			—			—			7.86	%

The weighted-average interest rate of G REIT’s mortgage debt as of December 31, 2006 was 5.65% per annum. As of December 31, 2006, G REIT’s mortgage debt consisted of $196,321,000, or 86.9%, of the total debt at a fixed interest rate of 5.32% per annum and $29,515,000, or 13.1%, of the total debt at a variable interest rate of 7.86% per annum. An increase in the variable interest rate on certain mortgages payable constitutes a market risk. As of December 31, 2006, for example a 0.50% increase in LIBOR would have decreased G REIT’s overall net assets by $148,000, or less than 0.06%.

Item 8.      Financial Statements and Supplementary Data.

See the index included at “Item 15. Exhibits, Financial Statement Schedules.”

Item 9.      Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.

We did not employ independent accountants to perform an audit on the financial statements contained in this Form 10-K.

Item 9A(T).      Controls and Procedures.

(a) Evaluation of disclosure controls and procedures.  We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC, rules and forms, and that such information is accumulated and communicated to us, including our Trustees and advisor, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, we recognize that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, as ours are designed to do, and we necessarily were required to apply our judgment in evaluating whether the benefits of the controls and procedures that we adopt outweigh their costs.

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As of December 31, 2007, an evaluation was conducted under the supervision and with the participation of our Trustees and advisor of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934). Based on this evaluation, our Trustees concluded that the design and operation of these disclosure controls and procedures were effective.

(b) Management’s Report on Internal Control over Financial Reporting.  Our Trustees are responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). Under the supervision of our Trustees and with the participation of our Trustees and advisor, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can only provide reasonable assurance with respect to financial statement preparation and presentation.

Based on our evaluation under the Internal Control-Integrated Framework, our Trustees concluded that our internal control over financial reporting was effective as of December 31, 2007.

(c) Changes in internal control over financial reporting.  There were no changes in our internal control over financial reporting that occurred during the quarter ended December 31, 2007 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

This Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Trustees’ report was not subject to attestation by our independent registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only Trustees’ report in this Annual Report on Form 10-K.

Item 9B.      Other Information.

None.

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PART III

Item 10.      Directors, Executive Officers and Corporate Governance.

As of March 24, 2008, we have no directors or executive officers. G REIT Liquidating Trust is administered by our five Trustees, consisting of the following:

Name	Age		Position	Term of Office
Gary Hunt		59	Trustee	Since January 2008
W. Brand Inlow		54	Trustee	Since January 2008
Edward A. Johnson		56	Trustee	Since January 2008
D. Fleet Wallace		40	Trustee	Since January 2008
Gary T. Wescombe		65	Chairman of the Trustees	Since January 2008

Gary H. Hunt previously served as a director of G REIT, Inc. from July 2005 to January 2008. Mr. Hunt has also served as a director of Grubb & Ellis Company since December 2007 previously serving as a director of NNN Realty Advisors from December 2006 to December 2007. Mr. Hunt has served as the managing partner of California Strategies, a privately held consulting firm in Irvine, California that works with large homebuilders, real estate companies and government entities since 2001. Prior to serving with California Strategies, Mr. Hunt was the Executive Vice President of The Irvine Company, a 110-year-old privately held company that plans, develops and invests in real estate primarily in Orange County, California for 25 years. At The Irvine Company, Mr. Hunt worked at local, regional, state and federal levels directing the company’s major entitlement, regional infrastructure, planning and strategic government, media and community relations activities. Additionally, Mr. Hunt served on the board of directors and the Executive Committee of The Irvine Company for 10 years. Some of Mr. Hunt’s other work experience includes staff positions with the California State Legislature, U.S. House of Representatives, California Governor Ronald Reagan and Executive Director of the Californian Republican Party. He also serves on the board of directors of Glenair Inc., The Beckman Foundation and the Irvine Health Foundation. Mr. Hunt holds a J.D. degree from the Irvine University School of Law and teaches courses on business and government at the Graduate School of Management, University of California, Irvine.

W. Brand Inlow previously served as a director of G REIT, Inc. from April 2002 to January 2008. Since July 2007, Mr. Inlow has also served as a Trustee of T REIT Liquidating Trust since July 2007, having previously served as a director of T REIT, Inc. from May 2002 to July 2007. Mr. Inlow also serves as a director and audit committee member of Grubb & Ellis Apartment REIT, Inc. He is a Principal, Co-Founder, and serves as Director of Acquisitions for McCann Realty Partners, LLC, an apartment investment company focusing on garden apartment communities in the Southeast formed in October 2004. Since October 2003, Mr. Inlow has provided professional consulting services to the multifamily industry on matters related to acquisitions, dispositions, asset management and property management operations, and through an affiliation with LAS Realty in Richmond, Virginia conducts commercial real estate brokerage. Mr. Inlow is also President of Jessie’s Wish, Inc., a Virginia non-profit corporation dedicated to awareness, education and financial assistance for patients and families dealing with eating disorders. Mr. Inlow served as President of Summit Realty Group, Inc. in Richmond, Virginia, from September 2001 through October 2003. From November 1999 to September 2001, he was Vice President of Acquisitions for EEA Realty, LLC in Alexandria, Virginia where he was responsible for acquisition, disposition and financing of company assets, which were primarily garden apartment properties. From November 1991 to November 1999, Mr. Inlow worked for United Dominion Realty Trust, Inc., a publicly traded real estate investment trust, as Assistant Vice President and Senior Acquisition Analyst, where he was responsible for the acquisition of garden apartment communities.

Edward A. Johnson previously served as a director of G REIT, Inc. since December 2001. Dr. Johnson has served as President of the Au Sable Institute of Environmental Studies, Grand Rapids, Michigan since September 2007. Dr. Johnson served as the President of the University of the New West, Phoenix, Arizona from November 2003 to September 2007. Dr. Johnson served as President of Sterling College, a small liberal arts college affiliated with the Presbyterian Church (USA), in Sterling, Kansas, from 1997 to November 2003

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where his major accomplishments include development of strategic and business plans, initiation of the nation’s first undergraduate program in social entrepreneurship and selection as its first leadership college by Habitat for Humanity International. From 1992 to 1997, he served as executive director of the Arizona Commission for Postsecondary Education. Dr. Johnson received a B.S. degree in History and Political science from Morningside College, Sioux City, Iowa in 1973, a J.D. degree from Creighton University School of Law, Omaha, Nebraska in 1976, and a Ph.D. degree in Higher Education Administration — Law and Education specialization from Arizona State University, Tempe, Arizona in 1984.

D. Fleet Wallace previously served as a director of G REIT, Inc. from April 2002 to January 2008. Mr. Wallace has also served as a director of Grubb & Ellis Company since December 2007, having previously served as a director of NNN Realty Advisors from December 2006 to December 2007. Mr. Wallace also previously served as a director of T REIT, Inc. from May 2002 to July 2007. Mr. Wallace is a Principal and Co-Founder of McCann Realty Partners, LLC, an apartment investment company focusing on garden apartment properties in the Southeast formed in October 2004. Mr. Wallace also serves as a Principal of Greystone Capital Management, LLC, formed in September 2001, and helps manage Greystone Fund, L.P. and Greystone Finance, LLC. Greystone Fund, L.P. is a professionally managed opportunity fund invested primarily in promising venture capital opportunities and distressed assets in the form of real estate, notes and accounts receivable, inventory and other assets. Greystone Finance, LLC provides debt financing to commercial borrowers in Virginia which have limited access to more traditional sources of funding. From April 1998 to August 2001, Mr. Wallace served as Corporate Counsel and Assistant Secretary of United Dominion Realty Trust, Inc., a publicly-traded real estate investment trust. At United Dominion, he managed general corporate matters for over 150 affiliated entities, negotiated and executed numerous real estate acquisitions and dispositions, and provided legal support on over $1 billion in financing transactions. From September 1994 to April 1998, Mr. Wallace was in the private practice of law with the firm of McGuire Woods in Richmond, Virginia. Mr. Wallace received a B.A. degree in History from the University of Virginia in 1990 and a J.D. degree from the University of Virginia in 1994.

Gary T. Wescombe previously served as a director of G REIT, Inc. from December 2001 to January 2008. Mr. Wescombe provides consulting services to various entities in the real estate sector. From October 1999 to December 2001, he was a partner in Warmington Wescombe Realty Partners in Costa Mesa, California, where he focused on real estate investments and financing strategies. Prior to retiring in 1999, Mr. Wescombe was a Partner with Ernst & Young, LLP (previously Kenneth Leventhal & Company) from 1970 to 1999. In addition, Mr. Wescombe is director, Chief Financial Officer and Treasurer of the Arnold and Mabel Beckman Foundation, a nonprofit foundation established for the purpose of supporting scientific research. Mr. Wescombe also serves as a director and audit committee member of Grubb & Ellis Healthcare REIT, Inc. Mr. Wescombe received a B.S. degree in Accounting and Finance from California State University, San Jose in 1965 and is a member of the American Institute of Certified Public Accountants and California Society of Certified Public Accountants.

Our Advisor’s Executive Officers

The following table and biographical descriptions set forth information with respect to our advisor’s executive officers, as of March 24, 2008.

Name	Age		Position	Term of Office
Scott D. Peters		50	Chief Executive Officer	Since 2006
Francene LaPoint		43	Chief Financial Officer	Since 2006
Andrea R. Biller		58	General Counsel and Executive Vice President	Since 2003 Since 2007
Jeffrey T. Hanson		37	President and Chief Investment Officer	Since 2006
Richard T. Hutton, Jr.		56	Executive Vice President	Since 2003
Talle A. Voorhies		60	Executive Vice President and Secretary	Since 1998

There are no family relationships between any executive officers.

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Scott D. Peters has served as the Chief Executive Officer of our advisor since November 2006, having served as its Executive Vice President and Chief Financial Officer, from September 2004 to October 2006. He has also served as Chief Executive Officer, President and a director of NNN Realty Advisors, since its formation in September 2006 and as its Chairman of the Board since December 2007. Mr. Peters has also served as the Chief Executive Officer, President and a director of Grubb & Ellis Company since December 2007. From December 2005 to January 2008, Mr. Peters served as the Chief Executive Officer and President of G REIT, Inc., having previously served as its Executive Vice President and Chief Financial Officer since September 2004. Mr. Peters has also served as the Executive Vice President and Chief Financial Officer of T REIT, Inc. from September 2004 to December 2006 and as a director and Executive Vice President of Grubb & Ellis Apartment REIT, Inc. since April 2007 and January 2006, respectively. Mr. Peters has also served as Grubb & Ellis Healthcare REIT, Inc.’s Chief Executive Officer since April 2006, President since June 2007 and Chairman of the Board since 2006. From February 1997 to February 2007, Mr. Peters served as Senior Vice President, Chief Financial Officer and a director of Golf Trust of America, Inc., a publicly traded real estate investment trust. Mr. Peters received his B.B.A. degree in Accounting and Finance from Kent State University in Ohio.

Francene LaPoint has served as the Chief Financial Officer of our advisor since November 2006 having served as its Executive Vice President and Controller since July 2004. She has also served as the Chief Financial Officer of NNN Realty Advisors since September 2006 and as a director since December 2007. Ms. LaPoint has also served as the Executive Vice President, Accounting and Finance, of Grubb & Ellis Company since December 2007. She has also served as the Chief Financial Officer of NNN Realty Advisors since September 2006 and as a director since December 2007. Ms. LaPoint has also served as Chief Financial Officer of Realty since March 2007. Ms. LaPoint served as Senior Vice President and Corporate Controller of Hawthorne Savings, FSB (Hawthorne Financial Corporation), a publicly traded financial institution, from June 1999 to June 2004. Ms. LaPoint obtained her license to be a Certified Public Accountant while working for PricewaterhouseCoopers from January 1996 to June 1999. She graduated from California State University, Fullerton with a B.A. degree in Business Administration — Accounting Concentration and is a member of the American Institute of Certified Public Accountants.

Andrea R. Biller has served as the Executive Vice President of our advisor since January 2007 and its General Counsel since March 2003. Ms. Biller has also served as the General Counsel, Executive Vice President and Secretary of NNN Realty Advisors since its formation in September 2006 and as a director since December 2007. She has also served as the General Counsel, Executive Vice President and Secretary of Grubb & Ellis Company since December 2007. Ms. Biller has also served as Executive Vice President and Secretary of Grubb & Ellis Healthcare REIT, Inc. since April 2006. Ms. Biller has also served as the Secretary and Executive Vice President of G REIT, Inc. from June 2004 to January 2008 and December 2005 to January 2008, respectively, the Secretary of T REIT, Inc. from May 2004 to July 2007 and the Secretary of Grubb & Ellis Apartment REIT, Inc. since January 2006. Ms. Biller practiced as a private attorney specializing in securities and corporate law from 1990 to 1995 and 2000 to 2002. She practiced at the SEC from 1995 to 2000, including two years as special counsel for the Division of Corporation Finance. Ms. Biller earned a B.A. degree in Psychology from Washington University, an M.A. degree in Psychology from Glassboro State University in New Jersey and a J.D. degree from George Mason University School of Law in Virginia in 1990. Ms. Biller is a member of the California, Virginia and the District of Columbia State Bar Associations.

Jeffrey T. Hanson has served as the President and Chief Investment Officer of our advisor since December 2007 and January 2007, respectively. He has also served as the Chief Investment Officer of NNN Realty Advisors since September 2006. Mr. Hanson has also served as the President and Chief Executive Officer of Realty since July 2006 and as its Chairman of the Board of Directors since April 2007. Mr. Hanson has also served as the Executive Vice President, Investment Programs, of Grubb & Ellis since December 2007. He has also served as the Chief Investment Officer of NNN Realty Advisors since September 2006. Mr. Hanson has also served as the Chief Investment Officer of NNN Realty Advisors since its formation. From 1996 to July 2006, Mr. Hanson served as Senior Vice President with Grubb & Ellis Company’s Institutional Investment Group in the firm’s Newport Beach office. During this period with Grubb & Ellis, he managed investment sale assignments throughout Southern California and other Western US markets for major

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private and institutional clients. Mr. Hanson is a member of the Sterling College Board of Trustees and formerly served as a member of the Grubb & Ellis President’s Counsel and Institutional Investment Group Board of Advisors. Mr. Hanson earned a B.S. degree in Business from the University of Southern California with an emphasis in Real Estate Finance.

Richard T. Hutton, Jr., has served as an Executive Vice President of our advisor since September 2005. From April 1999 to August 2003, Mr. Hutton served as Senior Vice President — real estate acquisitions and Vice President Property Management for our advisor, where he oversaw the management of the real estate portfolios and property management staff of our advisor and its affiliates. Mr. Hutton has also served as our interim Chief Financial Officer from October 2003 through December 2003 and April 2004 through September 2004 and also serves as the Chief Executive Officer of NNN 2003 Value Fund, LLC. Mr. Hutton has over 15 years experience in real estate accounting, finance and property operations. Mr. Hutton’s previous experience includes serving as Controller for the TMP Group from November 1997 to April 1999. Mr. Hutton has also served as the interim Chief Financial Officer of G REIT, Inc. and our advisor from October 2003 through December 2003 and April 2004 through September 2004. Mr. Hutton has a B.A. degree in Psychology from Claremont McKenna College and has been licensed as a certified public accountant in California since 1984.

Talle A. Voorhies has served as an Executive Vice President and Secretary of our advisor since 1998. She also served as our advisor’s Executive Vice President from April 1998 to December 2001, when she became Chief Operating Officer. Ms. Voorhies served as Executive Vice President from April 1998 through February 2005 and Financial Principal from April 1998 through November 2004 of Grubb & Ellis Securities, Inc. Ms. Voorhies is Director of our advisor’s investor services department. She holds Series 22, 7, 24 and 27 licenses as a member of The Financial Industry Regulatory Authority (FINRA). Ms. Voorhies has also served as Vice President of G REIT, Inc. since December 2001 to January 2008. From December 1987 to January 1999, Ms. Voorhies worked with the TMP Group, Inc., where she served as Chief Administrative Officer and Vice President of broker-dealer relations.

Audit Committee

We do not have an audit committee or other committee that performs similar functions and, consequently, have not designated an audit committee financial expert. Due to our limited operations and level of activity, which primarily includes the sale of the remaining assets and the payment of outstanding obligations, our Trustees believe that the services of an audit committee financial expert are not warranted.

Fiduciary Relationship of our advisor to Us

Our advisor is deemed to be in a fiduciary relationship to us pursuant to the Advisory Agreement and under applicable law. Our advisor’s fiduciary duties include responsibility for our control and management and exercising good faith and integrity in handling our affairs. Our advisor has a fiduciary responsibility for the safekeeping and use of all of our funds and assets, whether or not they are in its immediate possession and control, and may not use or permit another to use such funds or assets in any manner except for our exclusive benefit.

Our funds will not be commingled with the funds of any other person or entity except for operating revenue from our properties.

Our advisor may employ persons or firms to carry out all or any portion of our business. Some or all such persons or entities employed may be affiliates of our advisor. It is not clear under current law the extent, if any, that such parties will have a fiduciary duty to us or our beneficiaries. Investors who have questions concerning the fiduciary duties of our advisor should consult with their own legal counsel.

Compensation of Directors and Trustees

Our Trustees each receive $1,000 per meeting, and our Chairman of the Trustees shall receive an additional $500 per meeting, payable on the first day of each month.

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Prior to the transfer to of G REIT’s assets and liabilities to us on January 28, 2008, G REIT paid each independent and outside director an annual retainer fee of $15,000. In addition, each independent and outside director was paid the following fees for attending board of directors and committee meetings:

•   $1,000 per regular monthly board of directors meeting, whether in person or by telephone;

•   $500 per committee meeting, whether in person or by telephone, unless the committee meeting follows a regularly scheduled monthly board meeting; and

•   an additional $500 per committee meeting to the committee chairperson for each meeting attended in person or by telephone.

Prior to the adoption of the plan of liquidation, the independent and outside directors also qualified for the independent director stock option plan and 2004 incentive award plan. As of February 27, 2006, all stock option plans were terminated.

The following table sets forth the compensation earned by G REIT’s directors in 2007:

									Change in
									Pension Value
	Fees								and Nonqualified
	Earned						Non-Equity		Deferred		All Other
	or Paid in		Stock		Option		Incentive Plan		Compensation		Compensation
Name	Cash ($)		Awards ($)		Awards ($)		Compensation ($)		Earnings ($)		($)		Total ($)
(a)	(b)(1)		(c)		(d)		(e)		(f)		(g)(2)		(h)
Gary T. Wescombe	$	23,000		—		—		—		—	$	25,000	$	48,000
Edward A. Johnson	$	19,500		—		—		—		—	$	25,000	$	44,500
D. Fleet Wallace	$	21,000		—		—		—		—	$	25,000	$	46,000
W. Brand Inlow	$	21,000		—		—		—		—	$	25,000	$	46,000
Gary H. Hunt	$	19,500		—		—		—		—	$	25,000	$	44,500

(1) Consists of the amounts described below:

		Basic Annual
		Retainer		Meeting Fees
Director	Role	($)		($)
Wescombe	Chairman of the Trustees	$	15,000	$	8,000
Johnson	Trustee	$	15,000	$	4,500
Wallace	Trustee	$	15,000	$	6,000
Inlow	Trustee	$	15,000	$	6,000
Hunt	Trustee	$	15,000	$	4,500

(2) G REIT’s independent directors were entitled to receive certain milestone payments of $25,000 on each of December 31, 2007 and 2006 for serving as members of G REIT’s board of directors and G REIT’s special committee. Our Trustees (and previously as the independent directors of G REIT) are also entitled to receive a milestone payment of $50,000 when we have made aggregate liquidating distributions of at least $11.00 per unit to our beneficiaries. Assuming that our Trustees receive the maximum amount of milestone payments for serving as our Trustees and for previously serving as members of G REIT’s board of directors and G REIT’s special committee, they will each receive aggregate payments of up to $100,000. As of March 24, 2008, based upon the satisfaction of performance milestones, each of Messrs. Hunt, Inlow, Johnson, Wallace and Wescombe have received milestone payments of $50,000 each from G REIT and/or G REIT Liquidating Trust.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires each director, officer, and individual beneficially owning more than 10% of a registered security of G REIT to file with the SEC, within specified time frames, initial statements of beneficial ownership (Form 3) and statements of changes in beneficial ownership (Forms 4 and 5) of common stock of the G REIT. These specified time frames require the reporting of changes in ownership

65

within two business days of the transaction giving rise to the reporting obligation. Reporting persons are required to furnish copies of all Section 16(a) forms filed with the SEC. Based solely on a review of the copies of such forms furnished to G REIT during and with respect to the fiscal year ended December 31, 2007 or written representations that no additional forms were required, to the best of our knowledge, all required Section 16(a) filings were timely and correctly made by reporting persons during 2007.

Code of Business Conduct and Ethics

We have not adopted a code of ethics nor do we currently intend to due to the fact that we have no employees and our advisor manages our business and affairs, with the oversight of our Trustees. Nonetheless, our Trustees intend to promote honest and ethical conduct, full and fair disclosure in our reports to the SEC, and compliance with applicable governmental laws and regulations.

Item 11.      Executive Compensation.

Compensation of Executive Officers

We have no employees and the former executive officers of G REIT were all employees of our advisor and/or its affiliates. These executive officers are compensated by our advisor and/or its affiliates and have not received any compensation from us for their services other than as listed in the table below.

Summary Compensation Table

													Change in
													Pension
													Value and
													Nonqualified
											Non-Equity		Deferred
							Stock		Option		Incentive Plan		Compensation		All Other
	Fiscal		Salary		Bonus		Awards		Awards		Compensation		Earnings		Compensation			Total
	Year		($)		($)		($)		($)		($)		($)		($)			($)
Name and Principal Position(a)	(b)		(c)		(d)		(e)		(f)		(g)		(h)		(i)			(j)
Scott D. Peters,		2007	$	—	$	—	$	—	$	—	$	—	$	—	$	200,000	(1)	$	200,000
Chief Executive Officer and President(3)		2006		—		—		—		—		—		—	$	200,000	(1)	$	200,000
Courtney A. Brower,		2007		—		—		—		—		—		—	$	25,000	(2)	$	25,000
Chief Accounting Officer(3)		2006		—		—		—		—		—		—		—			—
Andrea R. Biller,		2007		—		—		—		—		—		—	$	100,000	(1)	$	100,000
Executive Vice President and Secretary(3)		2006		—		—		—		—		—		—	$	100,000	(1)	$	100,000

(1)

In accordance with the plan of liquidation approved by G REIT stockholders, G REIT paid Scott D. Peters, G REIT’s former Chief Executive Officer and President, and Andrea R. Biller, G REIT’s former Executive Vice President and Secretary, retention bonuses of $50,000 and $25,000, respectively, upon the filing of each of its annual and quarterly reports with the SEC during the period of the liquidation process, beginning with the annual report for the year ending December 31, 2005. As of December 31, 2007, Mr. Peters and Ms. Biller have received, in the aggregate, retention bonuses of $400,000 and $200,000 from G REIT, respectively. Additionally, our advisor paid to each of Scott D. Peters and Andrea R. Biller a performance-based bonus of $100,000 upon the receipt by our advisor of net commissions aggregating $5,000,000 or more from the sale of G REIT’s properties. As of December 31, 2007, Mr. Peters and Ms. Biller have received their performance-based bonuses of $100,000 each from our advisor. Effective January 30, 2008 and March 4, 2008, Scott D. Peters and Andrea R. Biller, respectively, waived their rights to receive all future retention bonuses.

(2)

In April 2007, G REIT’s board of directors authorized the payment of $150,000 in retention and performance based bonuses to some of G REIT’s key officers and employees of our advisor. As of December 31, 2007, $130,000 in retention and performance bonuses had been paid by G REIT, of which Ms. Brower, G REIT’s Chief Accounting Officer, received $25,000.

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(3) As of January 28, 2008, Mr. Peters, Ms. Brower and Ms. Biller no longer served as officers of G REIT.

Option/SAR Grants in Last Fiscal Year

Pursuant to the plan of liquidation, G REIT’s equity compensation plans and any outstanding options were forfeited as of February 27, 2006.

Compensation Committee Interlocks and Insider Participation

During 2007, all of G REIT’s directors served on the executive compensation committee.

Item 12.      Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

Principal Beneficiaries

There is no public market for our units of beneficial interests. On January 22, 2008, G REIT formally closed its stock transfer books. The units are not and will not be listed on any exchange, quoted by a securities broker or dealer, nor admitted for trading in any market, including the over-the-counter market. The units of beneficial interests are not transferable except by operation of law or upon the death of a beneficiary.

The following table sets forth the beneficial ownership of units as of March 24, 2008, as to (i) each beneficiary that is known by us to have beneficially owned more than five percent of the units as of March 24, 2008; and (ii) our Trustees. All such information was provided by the people listed. All percentages have been calculated as of and are based upon 43,920,000 units outstanding at the close of business on such date.

The people in the table below have indicated that they have sole voting and investment power over the units listed.

	Number of Units		Percent of
Name of Beneficial Owner	Beneficially Owned(1)		Class
Gary T. Wescombe, Chairman of the Trustees		10,000		*
Edward A. Johnson, Trustee		10,000		*
D. Fleet Wallace, Trustee		10,000		*
W. Brand Inlow, Trustee		10,000		*
Gary H. Hunt, Trustee		5,000		*
Total		45,000

* Represents less than 1.0% of our outstanding units of beneficial interest.

Item 13.      Certain Relationships and Related Transactions, and Director Independence.

Our advisor manages our day-to-day business affairs and assets and carries out the directives of our Trustees. Our advisor is a Virginia limited liability company that was formed in April of 1998 to advise syndicated limited partnerships, limited liability companies, and other entities regarding the acquisition, management and disposition of real estate assets. Prior to our formation, our advisor held 23,138 shares of common stock of G REIT, which were converted into 23,138 units. Our advisor intends to retain such units while serving as our advisor.

Advisory Agreement

The Advisory Agreement between our advisor and G REIT expired on July 22, 2005. Based on the adoption of the plan of liquidation, our advisor has agreed to continue to provide its services to us on a month-to-month basis pursuant to the terms of the expired Advisory Agreement. Under the terms of the Advisory Agreement, our advisor has responsibility for our day-to-day operations, administers our accounting and bookkeeping functions, serves as a consultant in connection with policy decisions to be made by our

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Trustees, manages our properties and renders other services deemed appropriate by our Trustees. Our advisor is entitled to reimbursement from us for expenses incurred in rendering its services, subject to certain limitations. Fees and costs reimbursed to our advisor cannot exceed the greater of 2.0% of average invested assets, as defined in the Advisory Agreement, or 25.0% of net income for the previous four quarters, as defined in the Advisory Agreement. As of December 31, 2007, 2006 and 2005, such reimbursement had not exceeded these limitations. During the years ended December 31, 2007, 2006 and 2005, G REIT reimbursed our advisor for expenses of $1,951,000, $2,830,000, and $2,941,000, respectively, related to its operations.

Under the Advisory Agreement, our advisor bears the expenses incurred in connection with supervising, monitoring and inspecting real property or other assets owned by us (excluding proposed acquisitions) or otherwise relating to its duties under the Advisory Agreement. Such expenses include employing its personnel, rent, telephone, equipment and other administrative expenses. We reimburse our advisor for certain expenses incurred, including those related to proposed acquisitions and travel expenses. However, we will not reimburse our advisor for any operating expenses that, in any four consecutive fiscal quarters, exceed the greater of 2.0% of average invested assets or 25.0% of net income for such year. If our advisor receives an incentive distribution, net income (for purposes of calculating operating expenses) excludes any gain from the sale of assets. Any amount exceeding the greater of 2.0% of average invested assets or 25.0% of net income paid to our advisor during a fiscal quarter will be repaid to us within 60 days after the end of the fiscal year. We bear our own expenses for functions not required to be performed by our advisor under the Advisory Agreement, which generally include capital raising and financing activities, corporate governance matters, and other activities not directly related to real estate properties and other assets. To date, except as disclosed below, no reimbursements have been made to our advisor pursuant to the provisions of the Advisory Agreement.

Pursuant to the Advisory Agreement, our advisor or its affiliate is entitled to receive the payments and fees described below. These payments and fees were not negotiated at arm’s length and may be higher than payments and fees that would have resulted from an arm’s length transaction with an unrelated entity.

Real Estate Acquisition Fee

Prior to the adoption of the plan of liquidation, our advisor or its affiliate was entitled to a real estate acquisition fee of up to 3.0% of the purchase price of a property. For the year ended December 31, 2005, G REIT paid $448,000 to our advisor or its affiliate for real estate acquisition fees. No real estate acquisition fees were paid to our advisor for the years ended December 31, 2006 and 2005.

Real Estate Disposition Fee

Prior to the adoption of the plan of liquidation, our advisor or its affiliate was entitled to a real estate disposition fee equal to the lesser of 3.0% of the sales price or 50.0% of the sales commission that would have been paid to third-party sales broker. For properties sold after the adoption of the plan of liquidation, we anticipate paying our advisor or its affiliate a real estate disposition fee of up to 1.5% of the sales price of the property. For the years ended December 31, 2007, 2006 and 2005, G REIT paid our advisor or its affiliate $5,686,000, $6,713,000, and $1,115,000, respectively, for real estate disposition fees.

Lease Commissions

We pay our advisor or its affiliate a leasing commission for its services in leasing any of our properties of 6.0% of the value of any lease (based upon the contract rent during the term of the lease) entered into during the term of the Advisory Agreement and 3.0% with respect to any renewals. For the years ended December 31, 2007, 2006 and 2005, G REIT paid our advisor or its affiliate leasing commissions of $1,114,000, $3,705,000 and $2,756,000, respectively.

Property Management Fees

We pay our advisor or its affiliate a property management fee of 5.0% of the gross revenues from our properties. For the years ended December 31, 2007, 2006 and 2005, G REIT incurred and paid property management fees to our advisor or its affiliate of $1,658,000, $4,811,000, and $5,617,000, respectively.

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Incentive Distributions

Our advisor owned non-voting incentive performance units in the Operating Partnership and was entitled to incentive distributions of operating cash flow after G REIT stockholders received an 8.0% annual return on their invested capital. On January 28, 2008, immediately before the transfer of G REIT’s assets and liabilities to us, the Operating Partnership redeemed the special limited partnership interest held by its advisor, Grubb & Ellis Realty Investors, in exchange for the right to receive 15.0% of certain distributions made by G REIT and G REIT Liquidating Trust after G REIT’s stockholders, who are know our beneficiaries, have received certain returns on their invested capital. As a result of such redemption, G REIT owned 100.0% of the outstanding partnership interests in the Operating Partnership. No incentive distributions were made to our advisor for the years ended December 31, 2006, 2005 and 2004. In accordance with the plan of liquidation, the estimated incentive fee distribution to our advisor is between $0 and $9,070,000. Based on the valuation of G REIT’s portfolio as of December 31, 2007 and 2006, we have reserved for an estimated incentive fee distribution to our advisor of $763,000 and $3,226,000, respectively.

Retention Bonuses and Milestone Payments

In accordance with the plan of liquidation approved by G REIT stockholders, G REIT paid Scott D. Peters, G REIT’s former Chief Executive Officer and President, and Andrea R. Biller, G REIT’s former Executive Vice President and Secretary, retention bonuses of $50,000 and $25,000, respectively, upon the filing of each of its annual and quarterly reports with the SEC during the period of the liquidation process, beginning with the annual report for the year ending December 31, 2005. As of December 31, 2007, Mr. Peters and Ms. Biller had received, in the aggregate, retention bonuses of $400,000 and $200,000 from G REIT, respectively. Additionally, our advisor paid to each of Scott D. Peters and Andrea R. Biller a performance-based bonus of $100,000 upon the receipt by our advisor of net commissions aggregating $5,000,000 or more from the sale of G REIT’s properties. As of December 31, 2007, Mr. Peters and Ms. Biller had received their performance-based bonuses of $100,000 each from our advisor. Effective January 30, 2008 and March 4, 2008, Scott D. Peters and Andrea R. Biller, respectively, waived their rights to receive all future retention bonuses.

D. Fleet Wallace, W. Brand Inlow, Edward A. Johnson, Gary T. Wescombe and Gary H. Hunt, our Trustees (and previously independent directors of G REIT), were entitled to receive certain milestone payments of $25,000 on each of December 31, 2007 and 2006 for serving as members of G REIT’s board of directors and G REIT’s special committee. Our Trustees (and previously as the independent directors of G REIT) are also entitled to receive a milestone payment of $50,000 when we have made aggregate liquidating distributions of at least $11.00 per unit to our beneficiaries. Assuming that our Trustees receive the maximum amount of milestone payments for serving as our Trustees and for previously serving as members of G REIT’s board of directors and G REIT’s special committee, they will each receive aggregate payments of up to $100,000. As of March 24, 2008, based upon the satisfaction of performance milestones, each of Messrs. Hunt, Inlow, Johnson, Wallace and Wescombe have received milestone payments of $50,000 each from G REIT and/or G REIT Liquidating Trust.

Real Estate Commissions

In August 2006, Jeffrey T. Hanson was appointed to serve as a member of the then Board of Managers and the Managing Director-Real Estate of our advisor and the President and Chief Executive Officer of Realty. Prior to his employment with our advisor and Realty, Mr. Hanson was employed with Grubb & Ellis Company. In connection with his previous employment with Grubb & Ellis Company, and subsequent to his employment with our advisor and Realty, Mr. Hanson has been paid real estate commissions of approximately $309,000 relating to transactions involving properties sold by G REIT.

Related Party Accounts Receivable/Payable

Related party accounts receivable consists primarily of amounts due to us from our advisor and affiliates. Related party accounts payable consists primarily of amounts due from us to our advisor and affiliates.

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Review, Approval or Ratification of Transactions with Related Persons

All transactions between us and any related person, including our advisor and its affiliates, are reviewed and approved by our Trustees. Additionally, the plan of liquidation provides that we may sell our remaining assets to one of our affiliates or an affiliate of our advisor. If we enter such a transaction, we expect that our Trustees will require that Stanger, or another independent consultant, opine to us as to the fairness of the consideration to be received by us in such transaction, from a financial point of view, or conduct an appraisal of the applicable property as a condition to their approval. In no event will our Trustees approve a transaction if: (i) Stanger, or another independent consultant, concludes after a review of the information then available, including any pending offers, letters of intent, contracts for sale, appraisals or other data, that the consideration to be received by us is not fair to us from a financial point of view; (ii) Stanger, or another independent consultant, concludes that the consideration to be received is less than the appraised value of the applicable property; or (iii) we have received a higher offer for the applicable property from a credible party with whom we reasonably believe is ready, able and willing to close the transaction on the contract terms.

Director and Trustee Independence

Each of our Trustees qualified as “independent directors” as defined in G REIT’s charter in compliance with the requirements of the North American Securities Administration Association’s Statement of Policy Regarding Real Estate Investment Trusts. All of our current Trustees meet these same requirements for independence.

Item 14.      Principal Accounting Fees and Services.

Deloitte & Touché, LLP, or Deloitte, has served as our independent auditor since February 8, 2004 and has audited our financial statements for the years ended December 31, 2006 and 2005. We did not employ independent auditors to perform an audit on the financial statements contained in this Form 10-K for the year ended December 31, 2007.

The following table lists the fees for services rendered by the independent auditors for 2007 and 2006:

Services	2007		2006
Audit Fees(1)	$	432,000	$	636,000
Audit-Related Fees(2)		—		—
Tax Fees(3)		39,000		68,000
All Other Fees		—		—
Total	$	471,000	$	704,000

(1)	Audit fees billed in 2007 and 2006 consisted of the audit of our annual financial statements, acquisition audits, reviews of our quarterly financial statements, and statutory and regulatory audits, consents and other services related to filings with the SEC.
(2)	Audit-related fees billed in 2007 and 2006 consisted of financial accounting and reporting consultations.
(3)	Tax services billed in 2007 and 2006 consisted of tax compliance and tax planning and advice.

G REIT’s audit committee determined that the provision by Deloitte of non-audit services for G REIT in 2007 is compatible with Deloitte’s maintaining its independence.

G REIT’s audit committee approved Deloitte to perform the following non-audit services for G REIT during 2007:

•   consultations and consents related to SEC filings and registration statements;

•   consultation of accounting matters; and

•   tax planning and tax compliance for the U.S. income and other taxes.

G REIT’s audit committee pre-approved all auditing services and permitted non-audit services (including the fees and terms thereof) to be performed for G REIT by its independent auditor, subject to the de minims exceptions for non-audit services described in Section 10A(i)(1)(B) of the Exchange Act and the rules and regulations of the SEC.

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PART IV

Item 15.      Exhibits, Financial Statement Schedules.

(a)(1) Financial Statements:

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	Page
Consolidated Statements of Net Assets as of December 31, 2007 and 2006 (Liquidation Basis)		72
Consolidated Statement of Changes in Net Assets (Liquidation Basis) For the Year Ended December 31, 2007 and 2006		73
Consolidated Statement of Operations and Comprehensive Income (Loss) (Going Concern Basis) For the Year Ended December 31, 2005		74
Consolidated Statement of Stockholders’ Equity (Going Concern Basis) For the Year Ended December 31, 2005		75
Consolidated Statement of Cash Flows (Going Concern Basis) For the Year Ended December 31, 2005		76
Notes to Consolidated Financial Statements		77
Schedules		110

(a)(2) Financial Statement Schedules:

The following financial statement schedules for the year ended December 31, 2007 are submitted herewith:

	Page
Valuation and Qualifying Accounts (Schedule II)		110
Real Estate Operating Properties and Accumulated Depreciation (Schedule III)		111

All schedules other than the ones listed above have been omitted as the required information is inapplicable or the information is presented in the consolidated financial statements or related notes.

(a)(3) Exhibits:

The exhibits listed on the Exhibit Index (following the signatures section of this report) are included, or incorporated by reference, in this annual report.

(b) Exhibits:

See Item 15(a)(3) above.

(c) Financial Statement Schedules:

	Page
Valuation and Qualifying Accounts (Schedule II)		110
Real Estate Operating Properties and Accumulated Depreciation (Schedule III)		111

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G REIT LIQUIDATING TRUST

CONSOLIDATED STATEMENTS OF NET ASSETS
(Liquidation Basis)
As of December 31, 2007 and 2006

	As of December 31,
	2007		2006
ASSETS
Real estate investments:
Real estate held for sale	$	70,913,000	$	417,384,000
Investments in unconsolidated real estate		14,678,000		15,889,000
		85,591,000		433,273,000
Cash and cash equivalents		30,985,000		76,812,000
Restricted cash		1,299,000		8,555,000
Accounts receivable, net		2,193,000		5,025,000
Accounts receivable from related parties		414,000		199,000
Asset for estimated receipts in excess of estimated costs during liquidation		1,047,000		3,041,000
Total assets		121,529,000		526,905,000
LIABILITIES
Mortgage loans payable secured by properties held for sale	$	18,840,000	$	225,836,000
Accounts payable and accrued liabilities		4,840,000		8,526,000
Accounts payable due to related parties		835,000		1,175,000
Security deposits and prepaid rent		381,000		2,629,000
Total liabilities		24,896,000		238,166,000
Commitments and contingencies (Note 13)
Net assets in liquidation	$	96,633,000	$	288,739,000

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

72

G REIT LIQUIDATING TRUST

CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS
(Liquidation Basis)
For the Years Ended December 31, 2007 and 2006

	Year Ended December 31,
	2007			2006
Net assets in liquidation, beginning of period	$	288,739,000		$	453,459,000
Changes in net assets in liquidation:
Changes to asset (liability) for estimated receipts (costs) in excess of estimated costs (receipts) during liquidation:
Operating income		(8,771,000	)		(25,716,000	)
Distributions received from unconsolidated properties		(783,000	)		(1,388,000	)
Payments of liquidation costs and other amounts		4,429,000			12,501,000
Distributions to stockholders		—			8,235,000
Change in estimated receipts (costs) in excess of estimated costs (receipts) during liquidation		3,131,000			10,928,000
Change to liability for estimated costs in excess of estimated receipts during liquidation		(1,994,000	)		4,560,000
Change in fair value of assets and liabilities:
Change in fair value of marketable securities		—			(132,000	)
Change in fair value of real estate investments		(6,325,000	)		17,266,000
Change in assets and liabilities due to activity in liability for estimated costs in excess of estimated receipts during liquidation		5,125,000			6,368,000
Net increase in fair value		(1,200,000	)		23,502,000
Liquidating distributions to stockholders		(188,912,000	)		(192,782,000	)
Change in net assets in liquidation		(192,106,000	)		(164,720,000	)
Net assets in liquidation, end of period	$	96,633,000		$	288,739,000

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

73

G REIT LIQUIDATING TRUST

CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Going Concern Basis)
For the Year Ended December 31, 2005

	Year Ended
	December 31,
	2005
Expenses:
General and administrative	$	4,006,000
Operating loss		(4,006,000	)
Other (expense) income:
Interest expense (including amortization of deferred financing costs)		(2,054,000	)
Interest and dividend income		695,000
Gain on sale of marketable securities, unconsolidated real estate and joint venture		572,000
Equity in earnings (losses) of unconsolidated real estate		1,337,000
Income taxes		—
Other expense, net		(250,000	)
Loss from continuing operations before discontinued operations		(3,706,000	)
Discontinued operations:
Gain on sale of real estate		10,550,000
Loss from discontinued operations		(4,215,000	)
		6,335,000
Net income	$	2,629,000
Comprehensive income:
Net income	$	2,629,000
Unrealized gain on marketable securities		78,000
Comprehensive income	$	2,707,000
Net income (loss) per common share:
Continuing operations — basic and diluted	$	(0.08	)
Discontinued operations — basic and diluted	$	0.14
Total net income per common share — basic and diluted	$	0.06
Weighted-average number of common shares outstanding — basic and diluted		43,867,000
Distributions declared per share	$	0.75
Distributions declared	$	32,888,000

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

74

G REIT LIQUIDATING TRUST

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY
(Going Concern Basis)
For the Year Ended December 31, 2005

	Common Stock
			Common				Distributions			Accumulated
	Number of		Stock Par		Additional		in Excess			Comprehensive
	Shares		Value		Paid-In Capital		of Earnings			Income		Total
BALANCE — December 31, 2004		43,865,000		439,000		392,836,000		(36,305,000	)		55,000		357,025,000
Net income		—		—		—		2,629,000			—		2,629,000
Unrealized gain on marketable securities		—		—		—		—			78,000		78,000
Vesting of restricted stock and stock based compensation expense		4,000		—		234,000		—			—		234,000
Distributions		—		—		—		(32,888,000	)		—		(32,888,000	)
BALANCE — December 31, 2005		43,869,000	$	439,000	$	393,070,000	$	(66,564,000	)	$	133,000	$	327,078,000

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

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G REIT LIQUIDATING TRUST

CONSOLIDATED STATEMENT OF CASH FLOWS
(Going Concern Basis)
For the Year Ended December 31, 2005

	Year Ended
	December 31,
	2005
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	2,629,000
Adjustments to reconcile net income to net cash provided by operating activities:
Gain on sale of real estate		(10,550,000	)
Gain on sale of marketable securities, unconsolidated real estate and joint venture		(572,000	)
Depreciation and amortization (including deferred financing costs and above/below market leases and deferred rent)		34,536,000
Swap collar interest		226,000
Stock compensation expense		234,000
Distributions received in excess of equity in earnings from investments in unconsolidated real estate		56,000
Minority interests		(183,000	)
Change in operating assets and liabilities:
Accounts receivable		(1,374,000	)
Other assets		(2,475,000	)
Accounts payable and accrued liabilities		(2,773,000	)
Security deposits and prepaid rent		(57,000	)
Net cash provided by operating activities		19,697,000
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of real estate operating properties		(18,419,000	)
Purchase of investments in unconsolidated real estate and joint venture		—
Capital expenditures		(12,158,000	)
Proceeds from sale of real estate operating property		113,014,000
Proceeds from sale of unconsolidated real estate		273,000
Purchases of marketable securities		(23,849,000	)
Proceeds from sales of marketable securities		18,910,000
Proceeds from sale of joint venture		—
Restricted cash		2,661,000
Real estate and escrow deposits		—
Net cash provided by investing activities		80,432,000
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock, net		—
Borrowings under credit facility, mortgages payable and other debt		185,806,000
Principal repayments under credit facility, mortgages payable and other debt		(262,905,000	)
Refund (payment) of deferred financing costs		310,000
Minority interests contributions		—
Minority interests distributions		(674,000	)
Distributions		(32,888,000	)
Net cash used in financing activities		(110,351,000	)
NET DECREASE IN CASH AND CASH EQUIVALENTS		(10,222,000	)
CASH AND CASH EQUIVALENTS — beginning of year		17,567,000
CASH AND CASH EQUIVALENTS — end of year	$	7,345,000
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the year for:
Interest	$	26,616,000
Income taxes	$	—
NONCASH INVESTING AND FINANCING ACTIVITIES:
Investing Activities:
Accrual for tenant improvements and capital expenditures	$	242,000
The following represents the change in certain assets and liabilities in connection with our acquisitions and dispositions of operating properties:
Real estate deposits applied	$	—
Financing Activities:
Refinancing of property	$	—
Issuance of common stock for dividends reinvested	$	—

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

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005

The use of the words “we,” “us” or “our” refers to G REIT Liquidating Trust and its subsidiaries, except where the context otherwise requires.

1.   Organization and Description of Business

We were organized on January 22, 2008, as a liquidating trust pursuant to a plan of liquidation of G REIT, Inc., or G REIT. On January 28, 2008, in accordance with the Agreement and Declaration of Trust, or the Liquidating Trust Agreement, by and between G REIT and each of its directors, Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace and Gary T. Wescombe, or our Trustees, G REIT transferred its then remaining assets and liabilities to us. Upon the transfer of the assets and liabilities to us, each stockholder of G REIT as of January 22, 2008, or the Record Date, automatically became the holder of one unit of beneficial interest, or a unit, in G REIT Liquidating Trust for each share of G REIT common stock then currently held of record by such stockholder. Our purpose is to wind up the affairs of G REIT by liquidating its remaining assets, distributing the proceeds from the liquidation of the remaining assets to the holders of units, each a beneficiary and, collectively, the beneficiaries, and paying all liabilities, costs and expenses of G REIT and G REIT Liquidating Trust.

G REIT was incorporated on December 18, 2001, under the laws of the Commonwealth of Virginia and qualified and elected to be taxed as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended, or the Code, for federal income tax purposes. On September 27, 2004, G REIT was reincorporated in the State of Maryland in accordance with the approval of its stockholders at the 2004 Annual Meeting of Stockholders. G REIT was originally formed to acquire, manage and invest in office, industrial and service real estate properties which have a government-tenant orientation. G REIT was formed with the intent to be listed on a national stock exchange, quoted on a quotation system of a national securities association or merged with an entity whose shares are listed or quoted. In 2005, as a result of (i) then current market conditions, (ii) the increasing costs of corporate compliance (including, without limitation, all federal, state and local regulatory requirements applicable to us, including the Sarbanes-Oxley Act of 2002, as amended, or the Sarbanes-Oxley Act), and (iii) the possible need to reduce monthly distributions, the then G REIT board of directors determined that a liquidation would provide G REIT’s stockholders with a greater return on their investment over a reasonable period of time than through implementation of other alternatives considered.

As described below, on February 27, 2006, G REIT’s stockholders approved a plan of liquidation and the eventual dissolution of G REIT. Accordingly, G REIT has been engaged in an ongoing liquidation of its assets. As of December 31, 2007, G REIT owned interests in five properties aggregating a total gross leaseable area, or GLA, of 1.5 million square feet, comprised of interests in four consolidated office properties and one unconsolidated office property. With reference to their sale or disposition, these properties shall be referred to as our “remaining assets.” As of December 31, 2007, approximately 57.2% of the total GLA of its consolidated properties was leased and tenants with a government orientation occupied approximately 18.1% of the total GLA. On January 28, 2008, G REIT transferred its interests in the five remaining properties to us pursuant to the Liquidating Trust Agreement.

Pursuant to an advisory agreement, or the Advisory Agreement, Grubb & Ellis Realty Investors, LLC, or Grubb & Ellis Realty Investors (formerly known as Triple Net Properties, LLC), or our advisor, manages our day-to-day business affairs and assets and carries out the directives of our Trustees. Our advisor is a Virginia limited liability company that was formed in April of 1998 to advise syndicated limited partnerships, limited liability companies, and other entities, including many of our affiliates, regarding the acquisition, management and disposition of real estate assets. Our advisor advises us and certain of our affiliates with respect to the management and potential disposition of our remaining assets.

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

2.   Plan of Liquidation

On December 19, 2005, the board of directors of G REIT approved a plan of liquidation which was thereafter approved by stockholders of G REIT at the Special Meeting of Stockholders held on February 27, 2006. The G REIT plan of liquidation, or the plan of liquidation, contemplates the orderly sale of all of G REIT’s assets, the payment of its liabilities, the winding up of operations and the dissolution of G REIT. G REIT engaged Robert A. Stanger & Co., Inc., or Stanger, to perform financial advisory services in connection with the plan of liquidation, including rendering opinions as to whether the net real estate liquidation value range estimate and G REIT’s estimated per share distribution range were reasonable. In December 2005, Stanger opined that G REIT’s net real estate liquidation value range estimate and G REIT’s estimated per share distribution range were reasonable from a financial point of view. Actual values realized for assets and settlement of liabilities may differ materially from the amounts estimated by G REIT or reflected in Stanger’s opinion.

The plan of liquidation gave G REIT’s board of directors the power to sell any and all of its assets without further approval by its stockholders and provided that liquidating distributions be made to its stockholders as determined by G REIT’s board of directors. The plan of liquidation also provided for the transfer of G REIT’s remaining assets and liabilities to a liquidating trust if G REIT was unable to sell its assets and pay its liabilities within 24 months of its stockholders’ approval of the plan of liquidation (which was February 27, 2008). On October 29, 2007, G REIT’s board of directors approved the transfer of G REIT’s assets and liabilities to G REIT Liquidating Trust.

On January 22, 2008, G REIT and our Trustees, Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace and Gary T. Wescombe, the independent directors of G REIT, entered into the Liquidating Trust Agreement in connection with our formation. Gary T. Wescombe, the chairman of the G REIT board of directors was appointed the chairman of the Trustees. On January 28, 2008, G REIT transferred its remaining assets to, and its remaining liabilities were assumed by, us in accordance with the plan of liquidation and the Liquidating Trust Agreement. In connection with the transfer of assets to, and assumption of liabilities by, us the stock transfer books of G REIT were closed as of the close of business on the Record Date and each share of G REIT’s common stock outstanding on the Record Date was converted automatically into a unit. Following the conversion of shares to units, all outstanding shares of G REIT’s common stock were deemed cancelled. The rights of beneficiaries in their beneficial interests are not represented by any form of certificate or other instrument. Stockholders of G REIT on the Record Date were not required to take any action to receive their units. On the date of the conversion, the economic value of each unit of beneficial interest was equivalent to the economic value of a share of G REIT’s common stock. On January 28, 2008, G REIT filed a Form 15 with the Securities and Exchange Commission, or the SEC, to terminate the registration of G REIT’s common stock under the Securities Exchange Act of 1934, as amended, or the Exchange Act, and G REIT announced that it would cease filing reports under the Exchange Act. Our Trustees will issue to beneficiaries and file with the SEC annual reports on Form 10-K and current reports on Form 8-K upon the occurrence of a material event relating to us.

Immediately before the transfer of G REIT’s assets and liabilities to us, G REIT, L.P., the operating partnership of G REIT, or the Operating Partnership, redeemed the special limited partnership interest held by our advisor, in exchange for the right to receive 15.0% of certain distributions made by G REIT and G REIT Liquidating Trust after G REIT’s stockholders, who are know our beneficiaries, have received certain returns, as provided by the Operating Partnership Agreement. As a result of such redemption, G REIT owned 100.0% of the outstanding partnership interests in the Operating Partnership. The Operating Partnership was dissolved in connection with the dissolution of G REIT, and all of its assets and liabilities were distributed to G REIT immediately before the transfer to us.

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

Our existence will terminate upon the earliest of (i) the distribution of all of our assets in accordance with the terms of Liquidating Trust Agreement, or (ii) the expiration of a period of three years from the date assets were first transferred to G REIT Liquidating Trust, or January 28, 2011. Our existence may, however, be extended beyond the three-year term if our Trustees then determine that an extension is reasonably necessary to fulfill our purpose and, prior to such extension, our Trustees have requested and received certain no-action assurances from the SEC. Although we can provide no assurances, we currently expect to sell our remaining assets by September 30, 2008 and anticipate completing the plan of liquidation by December 31, 2008.

In accordance with the plan of liquidation, we continue to actively manage our property portfolio to seek to achieve higher occupancy rates, control operating expenses and maximize income from ancillary operations and services. We continually evaluate our existing portfolio and adjust our net real estate liquidation value accordingly.

It is our policy that when we execute a purchase and sale agreement or become aware of market conditions or other circumstances that indicate that the present value of our properties materially differs from our expected net sales price, we will adjust our liquidation value accordingly. Under the adoption of the plan of liquidation, we will not acquire any new properties, and are focused on liquidating our remaining assets.

3.   Summary of Significant Accounting Policies

The summary of significant accounting policies presented below is designed to assist in understanding our consolidated financial statements. Such financial statements and accompanying notes are the representations of our management, who are responsible for their integrity and objectivity. The following accounting policies conform to accounting principles generally accepted in the United States of America, or GAAP, in all material respects, and have been consistently applied in preparing the accompanying consolidated financial statements.

Use of Estimates

The preparation of our financial statements in conformity with GAAP and the liquidation basis of accounting requires management to make estimates and assumptions that affect the reported amounts of the assets, including net assets in liquidation, and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses for the reporting period. These estimates are made and evaluated on an on-going basis using information that is currently available as well as various other assumptions believed to be reasonable under the circumstances. Actual results could differ, perhaps in adverse ways, and those estimates could be different under different assumptions or conditions from those estimates.

Principles of Consolidation

Our accompanying consolidated financial statements include G REIT’s accounts and those of the Operating Partnership, the wholly owned subsidiaries of the Operating Partnership and any variable interest entities, as defined in Financial Accounting Standards Board, or FASB, Interpretation No. 46, Consolidation of Variable Interest Entities, an Interpretation of Accounting Research Bulletin No. 51, as revised, or FIN No. 46(R), that we have concluded should be consolidated. All significant intercompany balances and transactions have been eliminated in consolidation and all references to us include our operating partnership and its subsidiaries.

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

Liquidation Basis of Accounting

Under the liquidation basis of accounting, all assets were adjusted to their estimated fair value (on an undiscounted basis) and liabilities, including estimated costs associated with implementing the plan of liquidation, were adjusted to their estimated settlement amounts. Minority liabilities due to interests in properties held by tenants-in-common, or TICs, were offset against the respective properties. The valuation of real estate held for sale and investments in unconsolidated real estate is based on current contracts, estimates and other indications of sales value net of estimated selling costs. Actual values realized for assets and settlement of liabilities may differ materially from the amounts estimated. Estimated future cash flows from property operations were made based on the anticipated sales dates of our remaining assets. Due to the uncertainty in the timing of the anticipated sales dates and the cash flows there from, operations may differ materially from amounts estimated. These amounts are presented in the accompanying statement of net assets included in the consolidated financial statements. The net assets represent the estimated liquidation value of our remaining assets available to our beneficiaries upon liquidation. The actual settlement amounts realized for assets and settlement of liabilities may differ materially, perhaps in adverse ways, from the amounts estimated.

In accordance with the plan of liquidation, we continue to actively manage our property portfolio to seek to achieve higher occupancy rates, control operating expenses and maximize income from ancillary operations and services. We continually evaluate our existing portfolio and adjust our net real estate liquidation value accordingly. It is our policy that when we execute a purchase and sale agreement or become aware of market conditions or other circumstances that indicate that the present value of our properties materially differs from our expected net sales price, we will adjust our liquidation value accordingly. Under the adoption of the plan of liquidation, we will not acquire any new properties, and are focused on liquidating our remaining assets.

Operating Properties

Prior to the adoption of the plan of liquidation, operating properties were carried at the lower of historical cost less accumulated depreciation or fair value. The cost of the operating properties included the cost of land and completed buildings and related improvements. Expenditures that increased the service life of properties were capitalized; the cost of maintenance and repairs was charged to expense as incurred. The cost of building and improvements were depreciated on a straight-line basis over the estimated useful lives of the buildings and improvements, ranging primarily from 15 to 39 years and the shorter of the lease term or useful life, ranging from one to 10 years for tenant improvements. When depreciable property was retired or disposed of, the related costs and accumulated depreciation were removed from the accounts and any gain or loss reflected in operations.

Prior to the adoption of the plan of liquidation, an operating property was evaluated for potential impairment whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. Impairment losses were recorded on long-lived assets used in operations. Impairment losses were recorded on an operating property when indicators of impairment were present and the carrying amount of the asset was greater than the sum of the future undiscounted cash flows expected to be generated by that asset. G REIT would recognize an impairment loss to the extent the carrying amount exceeded the fair value of the property. G REIT did not record any impairment losses for the year ended December 31, 2005.

As of December 31, 2005, the operating properties were adjusted to fair value, less estimated costs to sell, through the adjustments to reflect the change to the liquidation basis of accounting. Subsequent to December 31, 2005, all changes in the estimated fair value of the operating properties, less estimated costs to sell, are adjusted to fair value with a corresponding change to net assets in liquidation.

80

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

Properties Held for Sale

Statement of Financial Accounting Standard, or SFAS, No. 144, Accounting for Impairment or Disposal of Long-Lived Assets, addresses financial accounting and reporting for the impairment or disposal of long-lived assets and requires that, in a period in which a component of an entity either has been disposed of or is classified as held for sale, the income statements for current and prior periods shall report the results of operations of the component as discontinued operations. Prior to the adoption of the plan of liquidation, G REIT reclassified amounts related to the operating properties in the consolidated financial statements to reflect the reclassification required by SFAS No. 144.

Accordingly, revenues, operating costs and expenses, and other non-operating results for the discontinued operations of the operating properties have been excluded from G REIT’s results from continuing operations for all periods presented herein. The financial results for the operating properties are presented in G REIT’s consolidated statement of operations in a single line item entitled “Income (loss) from discontinued operations.”

Prior to the adoption of the plan of liquidation, in accordance with SFAS No. 144 at such time as a property was held for sale, such property was carried at the lower of (i) its carrying amount or (ii) fair value less costs to sell. In addition, a property being held for sale ceased to be depreciated. G REIT classified operating properties as property held for sale in the period in which all of the following criteria were met:

•   management, having the authority to approve the action, committed to a plan to sell the asset;

•   the asset was available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets;

•   an active program to locate a buyer and other actions required to complete the plan to sell the asset had been initiated;

•   the sale of the asset was probable and the transfer of the asset was expected to qualify for recognition as a completed sale within one year;

•   the asset was being actively marketed for sale at a price that was reasonable in relation to its current fair value; and

•   given the actions required to complete the plan, it was unlikely that significant changes to the plan would be made or that the plan would be withdrawn.

Cash and Cash Equivalents

Cash and cash equivalents consist of all highly liquid investments with a maturity of three months or less when purchased. Certificates of deposit and short-term investments with remaining maturities of three months or less when acquired are considered cash equivalents.

Restricted Cash

Restricted cash is comprised of credit enhancements and impound reserve accounts for property taxes, insurance, capital improvements and tenant improvements. As of December 31, 2007 and 2006, G REIT had restricted cash of $1,299,000 and $8,555,000, respectively.

Minority Interests

Minority interests relate to the TIC interests in the consolidated properties that are not wholly owned by G REIT, which, as of December 31, 2007, amounted to a 21.5% in Western Place I & II. In accordance with

81

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

the adoption of the plan of liquidation, G REIT applied the minority interest liability of $1,202,000 and $5,349,000 as of December 31, 2007 and 2006, respectively, against the related assets and liabilities to properly reflect G REIT’s portion of the estimated fair value of such assets.

Tenant Receivables and Allowance for Uncollectible Accounts

Prior to the adoption of the plan on liquidation, tenant receivables and unbilled deferred rent receivables were carried net of the allowances for uncollectible current tenant receivables and unbilled deferred rent. An allowance was maintained for estimated losses resulting from the inability of certain tenants to meet the contractual obligations under their lease agreements. G REIT’s determination of the adequacy of these allowances was based primarily upon evaluations of historical loss experience, individual tenant receivables considering the tenant’s financial condition, security deposits, letters of credit, lease guarantees and current economic conditions and other relevant factors. In accordance with the plan of liquidation, as of December 31, 2007 and 2006, G REIT adjusted tenant receivables and deferred rent receivable to their net realizable value.

Derivative Financial Instruments

We are exposed to the effect of interest rate changes in the normal course of business. We seek to mitigate these risks by following established risk management policies and procedures which include the occasional use of derivatives. Our primary strategy in entering into derivative contracts is to minimize the volatility that changes in interest rates could have on its future cash flows. We employ derivative instruments, including interest rate swaps and caps, to effectively convert a portion of our variable-rate debt to fixed-rate debt. We do not enter into derivative instruments for speculative purposes.

Derivatives are recognized as either assets or liabilities in the balance sheet and measured at fair value in accordance with SFAS No. 133, Derivative Instruments and Hedging Activities. Changes in fair value are included as a component of interest expense in the consolidated statement of operations in the period of change.

Revenue Recognition

Prior to the adoption of the plan of liquidation, in accordance with SFAS No. 13, “Accounting for Leases,” minimum annual rental revenue was recognized on a straight-line basis over the term of the related lease (including rent holidays). Tenant reimbursement revenue, which is comprised of additional amounts recoverable from tenants for common area maintenance expenses and certain other recoverable expenses, was recognized as revenue in the period in which the related expenses are incurred. Rental revenue is recorded on the contractual basis under the liquidation basis of accounting for periods subsequent to the year ended December 31, 2005.

Concentration of Credit Risk

Financial instruments that potentially subject us to a concentration of credit risk are primarily cash investments and accounts receivable from tenants. Cash is generally invested in investment-grade short-term instruments and the amount of credit exposure to any one commercial issuer is limited. We have cash in financial institutions which is insured by the Federal Deposit Insurance Corporation, or FDIC, up to $100,000 per institution. As of December 31, 2007, G REIT had cash accounts in excess of FDIC insured limits. We believe this risk is not significant. Concentration of credit risk with respect to accounts receivable from tenants is limited. We perform credit evaluations of prospective tenants and security deposits are obtained upon lease execution.

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

As of December 31, 2007, G REIT had interests in one property located in California which accounted for 11.8% of its total revenue, one property located in Maryland which accounted for 22.3% of its total revenue and two properties located in Texas which accounted for 65.9% of its total revenue based on contractual base rent from leases in effect as of December 31, 2007. As of December 31, 2006, G REIT had interests in five properties located in California which accounted for 42.4% of its total revenue and four properties located in Texas which accounted for 31.3% of its total revenue based on contractual base rent from leases in effect as of December 31, 2006. As of December 31, 2007 and 2006, none of G REIT’s tenants accounted for 10.0% or more of its aggregate annual rental income.

Impairment

Prior to the adoption of the plan of liquidation, G REIT’s properties were carried at the lower of historical cost less accumulated depreciation or fair value. G REIT assessed the impairment of a real estate asset when events or changes in circumstances indicated that the net book value may not be recoverable. Indicators G REIT considered important and which it believed could trigger an impairment review include the following:

•   significant negative industry or economic trend;

•   a significant underperformance relative to historical or projected future operating results; and

•   a significant change in the manner in which the asset is used.

In the event that the carrying amount of a property exceeded the sum of the undiscounted cash flows (excluding interest) that were expected to result from the use and eventual disposition of the property, G REIT would recognize an impairment loss to the extent the carrying amount exceeded the estimated fair value of the property. The estimate of expected future net cash flows was inherently uncertain and relied on subjective assumptions which were dependent upon future and current market conditions and events that affect the ultimate value of the property. It required G REIT to make assumptions related to future rental rates, tenant allowances, operating expenditures, property taxes, capital improvements, occupancy levels, and the estimated proceeds generated from the future sale of the property. G REIT did not record any impairment losses for the year ended December 31, 2005.

As of December 31, 2005, the operating properties were adjusted to fair value, less estimated costs to sell, through the adjustments to reflect the change to the liquidation basis of accounting. Subsequent to December 31, 2005, all changes in the estimated fair value of the operating properties, less estimated costs to sell, are adjusted to fair value with a corresponding change to G REIT’s net assets in liquidation.

Investment in Unconsolidated Real Estate

Prior to the adoption of the plan of liquidation, G REIT accounted for itsinvestment in unconsolidated real estate operating property using the equity method of accounting. Accordingly, G REIT reported its net equity in G REIT’s proportionate share of the total investment in unconsolidated real estate as “Investment in unconsolidated real estate” on G REIT’s consolidated balance sheet. G REIT reported its proportionate share of the total earnings of G REIT’s investment in unconsolidated real estate as “Equity in earnings of unconsolidated real estate” on G REIT’s consolidated statements of operations. Under the liquidation basis of accounting all of G REIT’s investments in unconsolidated real estate are recorded at estimated fair value less costs to sell.

83

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

Fair Value of Financial Instruments

SFAS No. 107, Disclosures About Fair Value of Financial Instruments, requires disclosure of fair value of financial instruments, whether or not recognized on the face of the balance sheet, for which it is practical to estimate that value. SFAS No. 107 defines fair value as the quoted market prices for those instruments that are actively traded in financial markets. In cases where quoted market prices are not available, fair values are estimated using present value or other valuation techniques such as discounted cash flow analysis. The fair value estimates are made at the end of each year based on available market information and judgments about the financial instrument, such as estimates of timing and amount of expected future cash flows. Such estimates do not reflect any premium or discount that could result from offering for sale at one time our entire holdings of a particular financial instrument, nor do they consider that tax impact of the realization of unrealized gains or losses. In many cases, the fair value estimates cannot be substantiated by comparison to independent markets, nor can the disclosed value be realized in immediate settlement of the instrument.

G REIT’s consolidated statements of net assets include the following financial instruments: cash and cash equivalents, marketable securities, tenant rent and other receivables, accounts payable and accrued expenses and mortgage loans payable. G REIT considers the carrying values of cash and cash equivalents, tenant rent and other receivables and accounts payable and accrued expenses to approximate fair value for these financial instruments because of the short period of time between origination of the instruments and their expected realization. The fair value of payable to affiliates is not determinable due to its related party nature. Based on borrowing rates available to G REIT as of December 31, 2007 and 2006, the fair value and the net settlement value of the mortgage loans payable were $18,840,000 and $225,836,000, respectively.

Income Taxes

G REIT operated as a real estate investment trust for federal income tax purposes until its dissolution on January 28, 2008. As a REIT, G REIT was generally not subject to income taxes. To maintain its REIT status, G REIT was required to distribute annually as distributions at least 90.0% of G REIT’s REIT taxable income for the year, as defined by the Internal Revenue Code of 1986, as amended, or the Code, to G REIT’s stockholders, among other requirements. If G REIT failed to qualify as a REIT in any taxable year, G REIT would have been subject to federal income tax on its taxable income at regular corporate tax rates. Even if G REIT qualified for taxation as a REIT, G REIT may have been subject to certain state and local taxes on our income and property and federal income and excise taxes on its undistributed income. G REIT believes that it has met all of the REIT distribution and technical requirements for the years ended December 31, 2007, 2006 and 2005 and was not subject to any federal income taxes.

Per Share Data

Prior to the adoption of the plan of liquidation, G REIT reported earnings per share pursuant to SFAS No. 128, Earnings Per Share. Basic earnings per share attributable for all periods presented are computed by dividing the net income by the weighted-average number of shares outstanding during the period. Diluted earnings per share are computed based on the weighted-average number of shares and all potentially dilutive securities, if any. G REIT’s potentially dilutive securities were options and non-vested restricted shares of stock. As of December 31, 2007, 2006 and 2005, there were 0, 0 and 420,000 options, respectively, which were accounted for under the treasury stock method. There were 0, 0 and 51,000 non-vested restricted shares of stock as of December 31, 2007, 2006 and 2005, respectively. Upon approval of the plan of liquidation by G REIT’s stockholders, all outstanding options were forfeited on February 27, 2006. The options and restricted stock did not have a dilutive effect on earnings per share and, therefore, basic and diluted earnings per share were equivalent.

84

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

Net income per share is calculated as follows:

	Year Ended
	December 31,
	2005
Loss from continuing operations	$	(3,706,000	)
Gain on sale of real estate		10,550,000
Loss from discontinued operations		(4,215,000	)
Net income	$	2,629,000
Net income (loss) per share — basic and diluted:
Continuing operations	$	(0.08	)
Discontinued operations		0.14
Total net income per share — basic and diluted	$	0.06
Weighted-average number of shares outstanding — basic and diluted		43,867,000

Stock Based Compensation

Prior to the adoption of the plan of liquidation, as permitted by SFAS No. 123, Accounting for Stock-Based Compensation, and SFAS No. 148, Accounting for Stock-Based Compensation Transition and Disclosure, G REIT elected to follow Accounting Principles Board Opinion, or APB, No. 25, Accounting for Stock Issued to Employees, and related interpretations in accounting for its employee stock options. Under APB No. 25, compensation expense is recorded when the exercise price of employee stock options is less than the fair value of the underlying stock on the date of grant. G REIT implemented the disclosure-only provisions of SFAS No. 123 and SFAS No. 148. If G REIT had elected to adopt the expense recognition provisions of SFAS No. 123 the impact on net income and earnings per share of common stock would have been as follows:

	Year Ended
	December 31,
	2005
Reported net income	$	2,629,000
Add: Stock based employee compensation expense included in reported net income		162,000
Less: Total stock based employee compensation expense determined under fair value based method for all awards		(183,000	)
Pro forma net income	$	2,608,000
Reported net income per share — basic and diluted	$	0.06
Pro forma net income per share — basic and diluted	$	0.06

The pro forma amounts were determined by estimating the fair value of each option using the Black-Scholes option-pricing model, assuming a 7.5% dividend yield, a 3.5% to 4.4% risk-free interest rate based on the 10-year U.S. Treasury Bond at the date of issuance, an expected life of 10 years and a volatility rate of 10.0%.

There were no options granted during the years ended December 31, 2007, 2006 and 2005. Upon approval of the plan of liquidation, all outstanding options were forfeited on February 27, 2006.

SFAS No. 123(R), Share-Based Payment, requires that all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. Our

85

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

January 1, 2006 adoption of SFAS No. 123(R) did not have any impact on G REIT’s net assets in liquidation during the year ended December 31, 2006.

Asset Retirement Obligations

In March 2005, the Financial Accounting Standards Board, or FASB, issued Interpretation No. 47, Accounting for Conditional Asset Retirement Obligations, or FIN 47. FIN 47 clarifies guidance provided in FASB Statement No. 143, Accounting for Asset Retirement Obligations. The term asset retirement obligation refers to a legal obligation to perform an asset retirement activity in which the timing and/or method of settlement are conditional on a future event that may or may not be within the control of the entity. Entities are required to recognize a liability for the fair value of a conditional asset retirement obligation when incurred if the liability’s fair value can be reasonably estimated. FIN 47 was effective as of the end of the first fiscal year ending after December 15, 2005. The adoption of the interpretation did not have a material effect on G REIT’s consolidated financial statements.

Segments

We internally evaluate all of our properties as one industry segment and accordingly do not report segment information.

Recently Issued Accounting Pronouncements

In July 2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes, or FIN No. 48. This interpretation, among other things, creates a two-step approach for evaluating uncertain tax positions. Recognition (step one) occurs when an enterprise concludes that a tax position, based solely on its technical merits, is more-likely-than-not to be sustained upon examination. Measurement (step two) determines the amount of benefit that more-likely-than-not will be realized upon settlement. Derecognition of a tax position that was previously recognized would occur when a company subsequently determines that a tax position no longer meets the more-likely-than-not threshold of being sustained. FIN No. 48 specifically prohibits the use of a valuation allowance as a substitute for derecognition of tax positions, and it has expanded disclosure requirements. FIN No. 48 is effective for fiscal years beginning after December 15, 2006, in which the impact of adoption should be accounted for as a cumulative-effect adjustment to the beginning balance of retained earnings in the year of adoption. The adoption of FIN No. 48 did not have a material impact on G REIT’s or our consolidated financial statements.

In September 2006, the FASB issued Statement of Financial Accounting Standards, or SFAS, No. 157, Fair Value Measurement, or SFAS No. 157. SFAS No. 157 defines fair value, establishes a framework for measuring fair value in accordance with GAAP, and expands disclosures about fair value measurements. The provisions of SFAS No. 157 are effective for fiscal years beginning after November 15, 2007. G REIT adopted SFAS No. 157 on January 1, 2008. The adoption of SFAS No. 157 did not have a material effect on G REIT’s or our consolidated financial statements.

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities, or SFAS No. 159. SFAS No. 159 permits entities to choose to measure many financial instruments and certain other items at fair value. The objective of the guidance is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. SFAS No. 159 is effective as of the beginning of the first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of the fiscal year beginning on or before November 15, 2007, provided the provisions of SFAS No. 157 are applied. G REIT adopted SFAS No. 159 on a prospective

86

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

basis on January 1, 2008. The adoption of SFAS No. 159 did not have a material impact on G REIT’s or our consolidated financial statements.

In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities, or SFAS No. 161. SFAS No. 161 is intended to improve financial reporting about derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entity’s financial position, financial performance, and cash flows. SFAS No. 161 achieves these improvements by requiring disclosure of the fair values of derivative instruments and their gains and losses in a tabular format. It also provides more information about an entity’s liquidity by requiring disclosure of derivative features that are credit risk — related. Finally, it requires cross-referencing within footnotes to enable financial statement users to locate important information about derivative instruments. SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. The adoption of SFAS No. 161 is not expected to have a material impact on our consolidated financial statements.

4.   Asset (Liability) for Estimated Receipts (Costs) in Excess of Estimated (Costs) Receipts during Liquidation

Under the liquidation basis of accounting, we are required to estimate the cash flows from operations and accrue the costs associated with implementing and completing the plan of liquidation. We currently estimate that we will have operating cash inflows from our estimated receipts in excess of the estimated costs of liquidation. These amounts can vary significantly due to, among other things, the timing and estimates for executing and renewing leases, along with the estimates of tenant improvements incurred and paid, the timing of the property sales, the timing and amounts associated with discharging known and contingent liabilities and the costs associated with winding up our operations. These costs are estimated and are expected to be paid over the liquidation period.

The change in the asset for estimated receipts in excess of estimated costs during liquidation as of December 31, 2007 is as follows:

	December 31,			Cash Payments			Change in		December 31,
	2006			and (Receipts)			Estimates		2007
Assets:
Estimated net inflows from consolidated and unconsolidated operating activities	$	12,424,000		$	(9,554,000	)	$	1,158,000	$	4,028,000
Liabilities:
Liquidation costs		(5,291,000	)		1,417,000			1,871,000		(2,003,000	)
Capital expenditures		(4,092,000	)		3,012,000			102,000		(978,000	)
	$	(9,383,000	)	$	4,429,000		$	1,973,000	$	(2,981,000	)
Total asset for estimated receipts in excess of estimated costs during liquidation	$	3,041,000		$	(5,125,000	)	$	3,131,000	$	1,047,000

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

The change in the asset (liability) for estimated receipts (costs) in excess of estimated (costs) receipts during liquidation as of December 31, 2006 is as follows:

	December 31,			Cash Payments			Change in			December 31,
	2005			and (Receipts)			Estimates			2006
Assets:
Estimated net inflows from consolidated and unconsolidated operating activities	$	24,390,000		$	(27,104,000	)	$	15,138,000		$	12,424,000
Liabilities:
Liquidation costs		(4,418,000	)		2,697,000			(3,570,000	)		(5,291,000	)
Liquidating distributions to stockholders		(8,226,000	)		8,235,000			(9,000	)		—
Capital expenditures		(13,265,000	)		9,804,000			(631,000	)		(4,092,000	)
		(25,909,000	)		20,736,000			(4,210,000	)		(9,383,000	)
Total asset (liability) for estimated receipts (costs) in excess of estimated (costs) receipts during liquidation	$	(1,519,000	)	$	(6,368,000	)	$	10,928,000		$	3,041,000

Accrued distributions to stockholders included in the liability for estimated costs in excess of estimated receipts during liquidation at December 31, 2005 included the estimated monthly liquidating distributions at an annualized rate of 7.50% expected to be paid pursuant to the plan of liquidation. The cash payments in distributions to stockholders include distributions paid of $8,235,000 for the first quarter of 2006. Subsequent to March 31, 2006, all distributions have been in the form of liquidating distributions to G REIT’s stockholders and recorded when approved.

5.   Net Assets in Liquidation

For the Year Ended December 31, 2007

Net assets in liquidation decreased $192,106,000, or $4.37 per share, during the year ended December 31, 2007. The primary reasons for the decrease in net assets were a decrease in real estate assets of $347,682,000, or $7.92 per share, a decrease in cash and cash equivalents of $45,827,000 or $1.04 per share, and a decrease in restricted cash of $7,256,000, or $0.17 per share, offset by a decrease in mortgage loans payable of $206,996,000, or $4.71 per share.

The overall decrease in real estate assets during the year ended December 31, 2007 was primarily due to: (i) a decrease of $342,107,000, or $7.79 per share, due to the sale of the Two Corporate Plaza, One World Trade Center, One Financial Plaza, 824 Market Street, North Belt Corporate Center, Opus Plaza at Ken Caryl, Madrona Buildings, North Pointe Corporate Center, Eaton Freeway Industrial Park and Bay View Plaza properties; (ii) a decrease of $903,000, or $0.02 per share, as a result of the anticipated sale of the Pax River Office Park property which closed on March 12, 2008; and (iii) a decrease of $6,314,000, or $0.14 per share, in the in the expected liquidation value of certain other properties. The decrease was partially offset by an increase of $1,642,000, or $0.04 per share, in the expected liquidation value of certain other properties. The decrease in cash and cash equivalents during the year ended December 31, 2007 was primarily due to the distributions to stockholders of approximately $188,912,000, or $4.30 per share, offset by net proceeds of $139,833,000 or $3.18 per share, received on the sale of the Two Corporate Plaza, One World Trade Center, One Financial Plaza, 824 Market Street, North Belt Corporate Center, Opus Plaza at Ken Caryl, Madrona Buildings, North Pointe Corporate Center, Eaton Freeway Industrial Park and Bay View Plaza properties.

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

The decrease in restricted cash during the year ended December 31, 2007 was primarily due to the return of lender required reserves in conjunction with the sale of properties. The decrease in mortgage loans payable during the year ended December 31, 2007 was primarily due to the sale of the Two Corporate Plaza, One World Trade Center, One Financial Plaza, 824 Market Street, North Belt Corporate Center, Opus Plaza at Ken Caryl, Madrona Buildings, Eaton Freeway Industrial Park and Bay View Plaza properties and the payoff of the mortgage loan at theSutter Square Galleria property.

For the Year Ended December 31, 2006

Net assets in liquidation decreased $164,720,000, or $3.75 per share, during the year ended December 31, 2006. The primary reasons for the decrease in net assets includes: (i) a decrease in real estate investments of $418,779,000, or $9.54 per share; (ii) a decrease in restricted cash of $5,733,000, or $0.13 per share; (iii) a decrease in investment in marketable securities of $7,617,000, or $0.17 per share; and (iv) a decrease in the liability for estimated costs in excess of estimated receipts during liquidation of $4,560,000, or $0.10 per share, resulting in an asset for estimated receipts in excess of estimated costs during liquidation as offset by (a) an increase in cash and cash equivalents of $69,639,000, or $1.59 per share; (b) a decrease in mortgage loans payable and amounts owed under a credit facility and other debt of $185,530,000, or $4.22 per share; (c) a decrease in accounts payable and accrued liabilities of $5,614,000, or $0.13 per share; and (d) a decrease in security deposits and prepaid rent of $2,360,000, or $0.05 per share.

The overall decrease in the value of real estate assets during the year ended December 31, 2006 includes: (i) a decrease of $400,513,000, or $9.12 per share, due to the sale of the 600 B Street, Hawthorne Plaza, AmberOaks, Brunswig Square, Centerpointe Corporate Park, 5508 Highway 290, Department of Children and Family Campus, Public Ledger Building, Atrium Building and Gemini Plaza properties during the year ended December 31, 2006; (ii) a decrease of $2,587,000, or $0.06 per share, in the anticipated sales prices of the One World Trade Center and One Financial Plaza properties pursuant to executed purchase and sale agreements; and (iii) a decrease of $20,777,000, or $0.47 per share, in the expected liquidation values of certain other properties; as offset by (a) an increase of $1,021,000, or $0.02 per share, as a result of the anticipated sale of the Two Corporate Park property which closed on January 11, 2007; (b) an increase of $39,000, or less than $0.01 per share, as a result of the anticipated sales price of the Opus Plaza at Ken Caryl property pursuant to an executed purchase and sale agreement and (c) an increase of $4,038,000, or $0.09 per share, in the expected liquidation value of certain other properties. The increase in cash and cash equivalents is primarily due to the proceeds received on the sale of our properties which closed in the fourth quarter of 2006. The decrease in restricted cash, accounts payable and accrued liabilities, security deposits and prepaid rent, mortgage loans payable and amounts owed under a credit facility is primarily due to the sale of our properties during the year ended December 31, 2006. The decrease in investment in marketable securities is due to the liquidation of investments in marketable securities during the year ended December 31, 2006.

The net assets in liquidation as of December 31, 2007 of $96,633,000 plus cumulative liquidating distributions through December 31, 2007 of approximately $381,694,000 (which were paid to G REIT stockholders prior to the transfer of G REIT’s assets and liabilities to us) would result in liquidating distributions to our beneficiaries per unit of approximately $10.89 per unit (of which $8.69 per share was paid to G REIT stockholders prior to the transfer of G REIT’s assets and liabilities to us). These estimates for liquidating distributions per unit include projections of costs and expenses expected to be incurred during the period required to complete the plan of liquidation. These projections could change materially based on the timing of sales, the performance of the underlying assets and any changes in the underlying assumptions of the projected cash flows.

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

6.   Real Estate Investments

Our real estate investments are comprised of consolidated properties and investment in unconsolidated real estate. As of December 31, 2007 and 2006, all of our consolidated properties are considered held for sale in accordance with the plan of liquidation.

G REIT had the following acquisitions and dispositions during the years ended December 31, 2007, 2006 and 2005:

Dispositions in 2007

Pursuant to the Advisory Agreement, our advisor or its affiliate is entitled to property disposition fees in connection with our disposition of properties. Prior to the adoption of the plan of liquidation, our advisor or its affiliate was entitled to a real estate disposition fee equal to the lesser of 3.0% of the sales price or 50.0% of the sales commission that would have been paid to third-party sales broker. For properties sold after the adoption of the plan of liquidation, we anticipate paying our advisor or its affiliate a real estate disposition fee of up to 1.5% of the sales price of the property. Certain disposition fees paid to Triple Net Properties Realty, Inc., or Realty, were passed through to our advisor pursuant to an agreement between our Advisor and Realty, or the Realty-Triple Net Agreement.

Two Corporate Plaza — Houston, Texas

On January 11, 2007, G REIT sold Two Corporate Plaza located in Houston, Texas, or the Two Corporate Plaza property, to Metro Properties, LLC, an unaffiliated third party, for a sales price of $18,000,000. G REIT’s net cash proceeds from the sale were $7,127,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves. A property disposition fee of $270,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $380,000, or 2.1% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2005, G REIT’s net assets available in liquidation were increased by approximately $1,021,000 as of December 31, 2006 as a result of the sale.

One World Trade Center — Long Beach, California

On March 22, 2007, G REIT sold One World Trade Center located in Long Beach, California, or the One World Trade Center property, to Legacy Partners Realty Fund II, LLC, an unaffiliated third party, for a sales price of $148,900,000. G REIT’s net cash proceeds from the sale were $54,165,000 after payment of the related mortgage loan, closing costs and other transaction expenses. A property disposition fee of $2,234,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $893,000, or 0.6% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $310,000 as a result of the sale.

One Financial Plaza — St. Louis, Missouri

On March 30, 2007, G REIT sold One Financial Plaza located in St. Louis, Missouri, or the One Financial Plaza property, of which G REIT owned 77.63%, to Parmenter Realty Fund III, Inc., an unaffiliated third party, for a sales price of $47,000,000. G REIT’s net cash proceeds from the sale were $11,487,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves. A property disposition fee of $705,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $380,000, or 0.81% of the sales price, was also paid to an

90

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

unaffiliated broker at closing. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date increased by approximately $400,000 as a result of the sale.

824 Market Street — Wilmington, Delaware

On June 29, 2007, G REIT sold 824 Market Street located in Wilmington, Delaware, or the 824 Market Street property, to TIC investors managed by our advisor for a sales price of $37,000,000. G REIT’s net cash proceeds from the sale were $16,636,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves and collateral account. A property disposition fee of $648,000, or 1.8% of the sales price, was paid to our advisor and its affiliate. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $877,000 as a result of the sale.

North Belt Corporate Center — Houston, Texas

On June 29, 2007, G REIT sold North Belt Corporate Center located in Houston, Texas, or the North Belt Corporate Center property, to Younan Properties, Inc., an unaffiliated third party, for a sales price of $17,750,000. G REIT’s net cash proceeds from the sale were $6,952,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves and collateral account. A property disposition fee of $266,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $352,000, or 2.0% of the sales price, was also paid to Grubb & Ellis. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $69,000 as a result of the sale.

Opus Plaza at Ken Caryl — Littleton, Colorado

On July 23, 2007, G REIT sold Opus Plaza at Ken Caryl located in Littleton, Colorado, or the Opus Plaza at Ken Caryl property, to On Dow Avenue Partners, LLC, an unaffiliated third party, for a sales price of $10,400,000. G REIT’s net cash proceeds from the sale were $3,207,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves. A property disposition fee of $156,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $312,000, or 3.0% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $177,000 as a result of the sale.

Madrona Buildings — Torrance, California

On August 2, 2007, G REIT sold Madrona Buildings located in Torrance, California, or the Madrona Buildings property, to Dominguez Industrial Center, LLC, an unaffiliated third party, for a sales price of $52,500,000. G REIT’s net cash proceeds from the sale were $15,034,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves. A property disposition fee of $788,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $412,000, or 0.8% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date increased by approximately $2,927,000 as a result of the sale.

Eaton Freeway Industrial Park — Phoenix, Arizona

On September 14, 2007, G REIT sold Eaton Freeway Industrial Park located in Phoenix, Arizona, or the Eaton Freeway Industrial Park property, to GD Eaton Freeway, LLC, an unaffiliated third party, for a sales price of $7,825,000. G REIT’s net cash proceeds from the sale were $2,326,000 after payment of the related

91

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves. A property disposition fee of $117,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $235,000, or 3.0% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $555,000 as a result of the sale.

North Pointe Corporate Center — Sacramento, California

On September 14, 2007, G REIT sold North Pointe Corporate Center located in Sacramento, California, or the North Pointe Corporate Center property, to Amstar-34, LLC, an unaffiliated third party, for a sales price of $23,750,000. G REIT’s net cash proceeds from the sale were $23,007,000 after payment of closing costs and other transaction expenses. A property disposition fee of $356,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $285,000, or 1.2% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $1,513,000 as a result of the sale.

Bay View Plaza — Alameda, California

On November 6, 2007, G REIT sold Bay View Plaza located in Alameda, California, or the Bay View Plaza property, of which G REIT owned 97.68%, to Ellis Partners LLC, an unaffiliated third party, for a sales price of $9,700,000. G REIT’s net cash proceeds from the sale were $3,828,000 after payment of the related mortgage loan, closing costs and other transaction expenses, and the return of lender required reserves. A property disposition fee of $146,000, or 1.5% of the sales price, was paid to our advisor and its affiliate and a sales commission of $194,000, or 2.0% of the sales price, was also paid to Grubb & Ellis. As compared to December 31, 2006, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $967,000 as a result of the sale.

Termination of Property under Contract

On August 8, 2007, G REIT entered into an agreement, which was subsequently amended, to sell Sutter Square Galleria located in Sacramento, California, or the Sutter Square Galleria property, to an unaffiliated third party for a sales price of $7,500,000. On September 21, 2007, the agreement, as amended, was terminated.

Dispositions in 2006

600 B Street — San Diego, California

On July 18, 2006, G REIT sold 600 B Street in San Diego, California, or the 600 B Street property, to Legacy Partners Realty Fund II, LLC, an unaffiliated third party, for a sales price of $95,500,000. G REIT’s cash proceeds were $91,730,000 after closing costs and other transaction expenses. A property disposition fee was paid to Realty of $1,433,000, or 1.5% of the sales price, and sales commissions to unaffiliated brokers of $573,000, or 0.6% of the sales price. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date increased by approximately $755,000 as a result of the sale.

Hawthorne Plaza — San Francisco, California

On September 14, 2006, G REIT sold Hawthorne Plaza located in San Francisco, California, or the Hawthorne Plaza property, to TMG Partners, an unaffiliated third party, for a sales price of $125,000,000. G REIT’s cash proceeds were $68,261,000 after payment of the related mortgage loan, closing costs and other transaction expenses. A property disposition fee was paid to Realty of $1,875,000, or 1.5% of the sales price,

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

and sales commissions to unaffiliated brokers of $750,000, or 0.6% of the sales price. The mortgage loan at the property of $51,719,000 was paid in full upon sale of the property. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date increased by approximately $19,960,000 as a result of the sale.

AmberOaks — Austin, Texas

On September 29, 2006, G REIT sold AmberOaks located in Austin, Texas, or the AmberOaks property, to Chase Merritt, LP, an unaffiliated third party, for a sales price of $46,837,000. G REIT’s cash proceeds were $27,584,000 after payment of the related mortgage loan, closing costs and other transaction expenses. A property disposition fee was paid to Realty of $703,000, or 1.5% of the sales price, and sales commissions to unaffiliated brokers of $611,000, or 1.3% of the sales price. The mortgage loan at the property of $18,050,000 was paid in full upon sale of the property. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date increased by approximately $5,268,000 as a result of the sale.

Brunswig Square — Los Angeles, California

On October 6, 2006, G REIT sold Brunswig Square located in Los Angeles, California, or the Brunswig Square property, to Jamison Properties Inc., an unaffiliated third party, for a sales price of $26,900,000. G REIT’s net cash proceeds from the sale were $9,639,000 after payment of the related mortgage loan, closing costs and other transaction expenses. A property disposition fee of $404,000, or 1.5% of the sales price, was paid to Realty and a sales commission of $336,000, or 1.3% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $2,062,000 as a result of the sale.

Centerpoint Corporate Park — Kent, Washington

On October 17, 2006, G REIT sold Centerpoint Corporate Park located in Kent, Washington, or the Centerpoint Corporate Park property, to Archon Acquisition, LLC, an unaffiliated third party, for a sales price of $77,525,000. G REIT’s net cash proceeds from the sale were $33,707,000 after payment of the related credit facility attributable to the Centerpoint Corporate Park property, closing costs and other transaction expenses. A property disposition fee of $1,163,000, or 1.5% of the sales price, was paid to Realty and a sales commission of $465,000, or 0.6% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date increased by approximately $17,173,000 as a result of the sale.

5508 Highway 290 — Austin, Texas

On November 14, 2006, G REIT sold 5508 Highway 290 located in Austin, Texas, or the 5508 Highway 290 property, to The Commons at Cliff Creek LTD, an unaffiliated third party, for a sales price of $10,200,000. G REIT paid $862,000 upon the disposition of the property to pay off the related credit facility and to pay closing costs and other transaction expenses. A property disposition fee of $150,000, or 1.5% of the sales price, was paid to Realty and a sales commission of $450,000, or 4.4% of the sales price, was also paid to unaffiliated brokers. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $705,000 as a result of the sale.

Department of Children and Family Campus — Plantation, Florida

On November 15, 2006, G REIT sold Department of Children and Family Campus located in Plantation, Florida, or the Department of Children and Family Campus property, to TIC investors managed by our advisor for a sales price of $13,000,000. G REIT’s net cash proceeds from the sale were $2,898,000 after pay-off of

93

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

the related credit facility and the payment of closing costs and other transaction expenses. As compared to December 31, 2005, G REIT’s net assets available in liquidation as the sales date increased by approximately $3,147,000 as a result of the sale.

Public Ledger Building — Philadelphia, Pennsylvania

On November 22, 2006, G REIT sold Public Ledger Building located in Philadelphia, Pennsylvania, or the Public Ledger Building property, to J Grasso Properties, LLC, an unaffiliated third party for a sales price of $43,000,000. G REIT’s net cash proceeds from the sale were $13,933,000 after pay-off of the related mortgage loan and the payment of closing costs and other transaction expenses. A property disposition fee of $645,000, or 1.5% of the sales price, was paid to Realty and a sales commission of $430,000, or 1.0% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date increased by approximately $558,000 as a result of the sale.

Atrium Building — Lincoln, Nebraska

On December 15, 2006, G REIT sold Atrium Building located in Lincoln, Nebraska, or the Atrium Building property, to Sequoia Investments XVIII, LLC, an unaffiliated third party for a sales price of $5,805,000. G REIT paid $219,000 upon the disposition of the property to pay off the related mortgage loan and to pay closing costs and other transaction expenses. A property disposition fee of $87,000, or 1.5% of the sales price, was paid to Realty and a sales commission of $174,000, or 3.0% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $480,000 as a result of the sale.

Gemini Plaza — Houston, Texas

On December 29, 2006, G REIT sold Gemini Plaza located in Houston, Texas, or the Gemini Plaza property, to Manuchehr Khoshbin, an unaffiliated third party for a sales price of $17,000,000. G REIT’s net cash proceeds from the sale were $5,633,000 after pay-off of the related mortgage loan and the payment of closing costs and other transaction expenses. A property disposition fee of $255,000, or 1.5% of the sales price, was paid to Realty and a sales commission of $251,000, or 1.5% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2005, G REIT’s net assets available in liquidation as of the sales date decreased by approximately $2,437,000 as a result of the sale.

Dispositions in 2005

525 B Street — San Diego, California

On August 10, 2005, G REIT sold 525 B Street located in San Diego, California, or the 525 B Street property, to an unaffiliated third party, for a sales price of $116,000,000. In conjunction with the sale of the 525 B Street property, G REIT paid off its existing cross-collateralized debt of $126,000,000 on the 525 B and 600 B Street properties. The sale resulted in G REIT recording a gain of $10,550,000. A property disposition fee of $1,115,000, or 1.0% of the sales price, was paid to Realty and sales commissions of $862,000, or 0.7% of the sales price, was also paid to unaffiliated brokers.

Park Sahara — Las Vegas, Nevada

On December 20, 2005, the Park Sahara property in Las Vegas, Nevada, of which G REIT owned a 4.75% TIC interest, was sold to an unaffiliated third party for a total sales price of $17,455,000. G REIT received net cash proceeds from the sale totaling approximately $273,000 after repayment of debt, closing costs and other transaction expenses. The sale resulted in G REIT recording a net gain of approximately

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

$132,000. A property disposition fee of $320,000, or approximately 1.8% of the total sales price, was paid to Realty and sales commissions of $639,000, or approximately 3.7% of the total sales price, was also paid to unaffiliated brokers.

Acquisitions in 2005

Pursuant to the Advisory Agreement, our advisor or its affiliate is entitled to property acquisition fees in connection with our acquisition of properties. Prior to the adoption of the plan of liquidation, our advisor or its affiliate was entitled to a real estate acquisition fee of up to 3.0% of the purchase price of a property. Certain acquisition fees paid to Realty were passed through to our advisor pursuant to the Realty-Triple Net Agreement.

Opus Plaza at Ken Caryl — Littleton, Colorado

On September 12, 2005, through our wholly-owned subsidiary G REIT — Opus Plaza at Ken Caryl, LLC, we purchased a 100.0% interest in Opus Plaza at Ken Caryl, a single-story office building of 62,000 square feet of GLA located in Littleton, Colorado. The property was purchased from an unaffiliated third party for a purchase price of $10,176,000. The seller paid Realty a sales commission of $296,000, or 2.9% of the purchase price. At the time of acquisition, we obtained a first mortgage loan from LaSalle secured by the property in the amount of $6,700,000. The loan bears interest at a fixed rate of 5.24% per annum and its maturity date is October 1, 2015.

Eaton Freeway — Phoenix, Arizona

On October 21, 2005, through our wholly-owned subsidiary G REIT — Eaton Freeway Industrial Park, LLC, we purchased a 100.0% interest in Eaton Freeway, a four-building multi-tenant industrial complex totaling 62,000 of GLA square feet located in Phoenix, Arizona. The property was purchased from an unaffiliated third party for a purchase price of $7,588,000. We paid Realty a sales commission of $152,000, or 2.0% of the purchase price. At acquisition, we obtained a first mortgage loan secured by the property from Principal Bank in the amount of $5,000,000. The loan bears interest at a fixed rate of 5.21% per annum and the maturity date of the loan is May 1, 2011.

Investments in Unconsolidated Real Estate

Prior to the adoption of the plan of liquidation, investments in unconsolidated real estate consisted of our investments in undivided TIC interests. Under the liquidation basis of accounting all of our investments in unconsolidated real estate are recorded at estimated fair value less costs to sell.

The summarized condensed combined historical financial information of investments in G REIT’s unconsolidated real estate is as follows:

	Year Ended
	December 31,
	2005
Revenues	$	20,512,000
Rental and other expenses		16,195,000
Net income	$	4,317,000
Our equity in earnings	$	1,337,000

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

7.   Restricted Cash

Restricted cash is comprised of credit enhancements and impound reserve accounts for property taxes, insurance, capital improvements and tenant improvements. As of December 31, 2007 and 2006, we had restricted cash of $1,299,000 and $8,555,000, respectively.

8.   Mortgage Loans Payable Secured by Properties Held for Sale

As of December 31, 2007, we had a secured mortgage loan outstanding on one of our consolidated properties, representing aggregate indebtedness in the principal amount of $24,000,000 ($18,840,000 on a liquidation basis) consisting of all variable rate debt at a weighted-average interest rate of 8.13% per annum. As of December 31, 2006, we had secured mortgage loans outstanding on 11 of our consolidated properties, representing aggregate indebtedness in the principal amount of $238,010,000 ($225,836,000 on a liquidation basis) consisting of $196,321,000 on a liquidation basis, or 86.9%, of fixed rate debt at a weighted-average interest rate of 5.32% per annum and $29,515,000 on a liquidation basis, or 13.1%, variable rate debt at a weighted-average interest rate of 7.86% per annum. As of December 31, 2007, the effective interest rate and weighted-average effective interest rate on the mortgage loan was 8.13% per annum. As of December 31, 2006 the effective interest rates on mortgage loans ranged from 5.18% to 8.22% per annum and the weighted-average effective interest rate was 5.65% per annum.

As of December 31, 2007 and 2006, we have adjusted the carrying values of the outstanding mortgage loans payable to the estimated settlement amount in the condensed consolidated statements of net assets. The adjusted amount excludes that portion of the mortgage debt attributable to the minority ownership interest in the properties that are not wholly owned by us.

Our properties financed by borrowings are required by the terms of the applicable loan documents to meet certain minimum loan to value, debt service coverage, performance covenants and other requirements on a combined and individual basis. On November 1, 2007, the $24,000,000 secured mortgage loan with LaSalle on the Western Place I & II property, of which we own 78.5%, matured. As a result, as of December 31, 2007, G REIT was in default on the mortgage loan with LaSalle. On February 26, 2008 we refinanced such mortgage loan with Wachovia. See Subsequent Events.

Derivatives are recognized as either assets or liabilities in the condensed consolidated statements of net assets and measured at fair value in accordance with SFAS No. 133, Derivative Instruments and Hedging Activities. Changes in fair value are included as a component of interest expense in the statement of operations in the period of change. We did not have any derivative financial instruments as of December 31, 2007 or 2006.

The principal payments due on notes payable for each of the next five years ending December 31 and thereafter are summarized as follows (liquidation basis):

Year	Amount
2008	$	18,840,000
2009		—
2010		—
2011		—
2012		—
Thereafter		—
	$	18,840,000

96

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

9.   Minority Interests

Minority interests relate to the TIC interests in the consolidated properties that are not wholly owned by us, which, as of December 31, 2007, amounted to a 21.5% interest in Western Place I & II. In accordance with the adoption of the plan of liquidation, we applied the minority interest liability of $1,202,000 and $5,349,000 as of December 31, 2007 and 2006, respectively, against the related assets and liabilities to properly reflect our portion of the estimated fair value of such assets.

We currently have the right to purchase all or any portion of the outstanding undivided TIC interests in Western Place I & II at fair market value. However, we do not intend to acquire any portion of the outstanding undivided TIC interests as we are currently focused on liquidating our remaining assets and liabilities.

10.   Stockholders’ Equity

Common Stock

As of December 31, 2007, 2006 and 2005, 43,920,000, 43,920,000 and 43,869,000 shares of our common stock were outstanding, respectively. The aggregate gross proceeds to us before offering costs and selling commissions were $437,315,000 pursuant to our initial public offering, or Initial Offering, and our second public offering, or Second Offering. See Note 14 — “Related Party Transactions”. An aggregate of 22,100 shares of our common stock, or $200,005 of our common stock, were sold to our advisor in accordance with the requirements of the North American Securities Administrators Association.

Pursuant to our Initial Offering, our limitation on all offering expenses is 15.0% of the gross offering proceeds. Effective October 17, 2002, our board of directors lowered the limitation on offering and organizational expenses to be borne by us on a prospective basis from 15.0% to 14.0% of the gross offering proceeds. Organizational and offering costs did not exceed these limitations during our Initial and Second Offerings.

In connection with our Initial Offering, we incurred $20,944,000 of costs related to the issuance and distribution of our common stock through December 31, 2004. Such amount includes $18,565,000 paid to NNN Capital Corp., the dealer manager of the Offering, a company 100.0% owned by Anthony W. Thompson, the former Chairman of the board of directors of Grubb & Ellis and founder of our Advisor, during the offering period, principally comprised of selling commissions, marketing and due diligence costs. In addition, we paid $1,630,000 to our advisor for reimbursement of offering expenses.

Beginning September 1, 2002, we began monthly distributions to G REIT stockholders of record as of the end of the preceding month at an annual rate of 7.00% of the per share purchase price to the extent of lawfully available funds. The distribution rate increased to 7.25% effective January 1, 2003 and to 7.50% effective June 1, 2003. Subsequent to March 31, 2006, all distributions have been paid in the form of liquidating distributions to its stockholders and recorded when approved. Since the approval of the plan of liquidation, G REIT paid three special liquidating distributions as follows: (i) in October 2006 G REIT paid $171,289,000, or $3.90 per share; (ii) in April 2007 G REIT paid $131,761,000, or $3.00 per share; and (iii) in November 2007 G REIT paid $43,920,000, or $1.00 per share, for a total of $7.90 per share being paid to date in special liquidating distributions. In addition, G REIT has paid cumulative monthly liquidating distributions beginning with the April 2006 distribution, paid in May 2006, through and including the December 2007 distribution, paid in January 2008, totaling $34,724,000, or $0.79 per share, to its stockholders. The monthly liquidating distributions to stockholders were based on an annualized rate of 7.50% on: (i) a $10.00 per share value from May 2006 through October 2006; (ii) a remaining $6.10 per share value from November 2006 to April 2007; (iii) a remaining $3.10 per share value from May 2007 to November 2007; and (iv) a remaining $2.10 per share value beginning in December 2007. While the plan of liquidation provided that monthly distributions would terminate following the payment of liquidating distributions totaling $150,000,000,

97

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

G REIT’s board of directors decided to continue to pay monthly distributions at an annualized rate of 7.50% on the share value remaining of $2.10. Our Trustees will continue to evaluate the payment of monthly liquidating distributions on an on-going basis as more properties are sold and additional special liquidating distributions are paid to beneficiaries. Every payment of liquidating distributions will be subject to the availability of cash and the discretion of our Trustees. For the year ended December 31, 2007, we declared liquidating distributions of $188,912,000, or $4.30 per share. For the year ended December 31, 2006, we declared distributions of $201,017,000, or $4.58 per share, which consisted of $8,235,000, or $0.19 per share, in distributions declared prior to G REIT stockholders approving the plan of liquidation on February 27, 2006 and $192,782,000, or $$4.39 per share, in liquidating distributions. We had distributions payable of $576,000, or $0.01 per share and $0 as of December 31, 2007 and 2006.

Stock Option Plans

Independent Director Stock Option Plan

On July 22, 2002, we adopted the independent director stock option plan, or Director Plan, which was approved by G REIT stockholders at our annual meeting on June 28, 2003. We had authorized and reserved a total of 100,000 shares of common stock for issuance under the Director Plan. The Director Plan provided for the grant of options to purchase 5,000 shares of common stock to each independent or outside director as of the date such individual became a director, and subsequent grants of options to purchase 5,000 shares of common stock on the date of each annual meeting of stockholders to each independent and outside director still in office. No options were granted during the years ended December 31, 2007 and 2006. Upon approval of the plan of liquidation by G REIT stockholders on February 27, 2006, all outstanding options were forfeited for no consideration and the Director Plan was terminated.

Officer and Employee Stock Option Plan

On July 22, 2002, we adopted the officer and employee stock option plan, or Officer Plan. We authorized and reserved a total of 400,000 shares of common stock for issuance under the Officer Plan. No options were granted during the years ended December 31, 2007 and 2006. Upon approval of the plan of liquidation by G REIT stockholders on February 27, 2006, all outstanding options were forfeited for no consideration and the Officer Plan was terminated.

2004 Incentive Award Plan

On May 10, 2004, we adopted the 2004 incentive award plan, or 2004 Plan, to provide for equity awards to our employees, directors and consultants, which was approved at our Annual Meeting of Stockholders on June 29, 2004. The 2004 Plan authorizes the grant of options to our employees, directors and consultants intended to qualify as incentive stock options under Section 422 of the Code. The 2004 Plan also authorizes the grant of awards consisting of nonqualified stock options, restricted stock, stock appreciation rights and other awards, including cash bonuses.

The aggregate number of shares of common stock subject to such awards was not to exceed 6,000,000 shares of our common stock. Our board of directors administered the 2004 Plan. The 2004 Plan provided that each of our non-employee directors would receive an automatic grant of 5,000 shares of restricted stock on the date of each of our annual meetings.

As of December 31, 2007 and 2006 there were 55,000 restricted shares of common stock granted. Restricted shares vested at 20.0% per year on each of the first through fifth anniversaries of the grant date, or sooner upon a change of control of our company. Compensation expense related to the restricted stock awards under the 2004 Plan is recorded over the related vesting periods based on the fair value of the underlying

98

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

awards. Included in the general and administrative expenses in the accompanying consolidated statement of operations is compensation expense of $98,000 for the year ended December 31, 2005, related to such awards. During the year ended December 31, 2005, 4,000 restricted shares vested. The 2004 Plan was terminated upon approval of the plan of liquidation by G REIT stockholders on February 27, 2006 and all outstanding restricted shares became fully vested.

	Number			Fair Value
Nonvested Restricted Shares at	of Shares			of Shares
Nonvested as of December 31, 2005		51,000		$	10.00
Vested		(51,000	)		(10.00	)
Nonvested as of December 31, 2006		—		$	—

Under the liquidation basis of accounting, the accelerated vesting of the restricted shares did not change the net assets available for liquidation. In addition, the forfeitures of all the outstanding vested and unvested stock options did not change net assets available for liquidation nor the amount of net assets available for liquidation per share. SFAS No. 123(R), Share-Based Payment, did not have any impact on the net assets in liquidation during the year ended December 31, 2006.

11.   Future Minimum Rent

Rental Income

We have operating leases with tenants that expire at various dates through 2021 and are either subject to scheduled fixed increases or adjustments based on the Consumer Price Index. Generally, the leases grant tenants renewal options. Leases also provide for additional rents based on certain operating expenses. Future minimum rent contractually due under operating leases, excluding tenant reimbursements of certain costs, as of December 31, 2007, are summarized as follows:

Year Ending	Amount
2008	$	8,444,000
2009		7,507,000
2010		5,918,000
2011		4,116,000
2012		2,447,000
Thereafter		4,741,000
Total	$	33,173,000

A certain amount of our rental income is from tenants with leases which are subject to contingent rent provisions. These contingent rents are subject to the tenant achieving periodic revenues in excess of specified levels. For the years ended December 31, 2007, 2006 and 2005, the amount of contingent rent earned by us was not significant.

12.   Related Party Transactions

Advisory Agreement

Advisory Fees

The Advisory Agreement between our advisor and G REIT expired on July 22, 2005. Based on the adoption of the plan of liquidation, our advisor has agreed to continue to provide its services to us on a

99

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

month-to-month basis pursuant to the terms of the expired Advisory Agreement. Under the terms of the Advisory Agreement, our advisor has responsibility for our day-to-day operations, administers our accounting and bookkeeping functions, serves as a consultant in connection with policy decisions to be made by our Trustees, manages our properties and renders other services deemed appropriate by our Trustees. Our advisor is entitled to reimbursement from us for expenses incurred in rendering its services, subject to certain limitations. Fees and costs reimbursed to our advisor cannot exceed the greater of 2.0% of average invested assets, as defined, or 25.0% of net income for the previous four quarters, as defined. As of December 31, 2007, 2006 and 2005, such reimbursement had not exceeded these limitations. During the years ended December 31, 2007, 2006 and 2005, G REIT reimbursed our advisor for expenses of $1,951,000, $2,830,000, and $2,941,000, respectively, related to its operations.

Pursuant to the Advisory Agreement, our advisor or its affiliate is entitled to receive the following payments and fees described below. These payments and fees were not negotiated at arm’s length and may be higher than payments and fees that would have resulted from an arm’s length transaction with an unrelated entity.

Real Estate Acquisition Fee

Prior to the adoption of the plan of liquidation, our advisor or its affiliate was entitled to a real estate acquisition fee of up to 3.0% of the purchase price of a property. For the year ended December 31, 2005, G REIT paid $448,000 to our advisor or its affiliate for real estate acquisition fees. No real estate acquisition fees were paid to our advisor for the years ended December 31, 2006 and 2005.

Real Estate Disposition Fee

Prior to the adoption of the plan of liquidation, our advisor or its affiliate was entitled to a real estate disposition fee equal to the lesser of 3.0% of the sales price or 50.0% of the sales commission that would have been paid to third-party sales broker. For properties sold after the adoption of the plan of liquidation, we anticipate paying our advisor or its affiliate a real estate disposition fee of up to 1.5% of the sales price of the property. For the years ended December 31, 2007, 2006 and 2005, G REIT paid our advisor or its affiliate $5,686,000, $6,713,000, and $1,115,000 for real estate disposition fees.

Lease Commissions

We pay our advisor or its affiliate a leasing commission for its services in leasing any of our properties of 6.0% of the value of any lease (based upon the contract rent during the term of the lease) entered into during the term of the Advisory Agreement and 3.0% with respect to any renewals. For the years ended December 31, 2007, 2006 and 2005, G REIT paid our advisor or its affiliate leasing commissions of $1,114,000, $3,705,000 and $2,756,000, respectively.

Property Management Fees

We pay our advisor or its affiliate a property management fee of 5.0% of the gross revenues from our properties. For the years ended December 31, 2007, 2006 and 2005, G REIT incurred and paid property management fees to our advisor or its affiliate of $1,658,000, $4,811,000 and $5,617,000, respectively.

Incentive Distributions

Our advisor owned non-voting incentive performance units in the Operating Partnership and was entitled to incentive distributions of operating cash flow after G REIT stockholders received an 8.0% annual return on their invested capital. On January 28, 2008, immediately before the transfer of G REIT’s assets and liabilities

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

to us, the Operating Partnership redeemed the special limited partnership interest held by its advisor, Grubb & Ellis Realty Investors in exchange for the right to receive 15.0% of certain distributions made by G REIT and G REIT Liquidating Trust after G REIT’s stockholders, who are know our beneficiaries, have received certain returns on their invested capital. As a result of such redemption, G REIT owned 100.0% of the outstanding partnership interests in the Operating Partnership. No incentive distributions were made to our advisor for the years ended December 31, 2006, 2005 and 2004. In accordance with the plan of liquidation, the estimated incentive fee distribution to our advisor is between $0 and $9,070,000. Based on the valuation of G REIT’s portfolio as of December 31, 2007 and 2006, we have reserved for an estimated incentive fee distribution to our advisor of $763,000 and $3,226,000, respectively.

Retention Bonuses and Milestone Payments

In accordance with the plan of liquidation approved by G REIT stockholders, G REIT paid Scott D. Peters, G REIT’s former Chief Executive Officer and President, and Andrea R. Biller, G REIT’s former Executive Vice President and Secretary, retention bonuses of $50,000 and $25,000, respectively, upon the filing of each of its annual and quarterly reports with the SEC during the period of the liquidation process, beginning with the annual report for the year ending December 31, 2005. As of December 31, 2007, Mr. Peters and Ms. Biller had received, in the aggreage, retention bonuses of $400,000 and $200,000 from G REIT, respectively. Additionally, our advisor paid to each of Scott D. Peters and Andrea R. Biller a performance-based bonus of $100,000 upon the receipt by our advisor of net commissions aggregating $5,000,000 or more from the sale of G REIT’s properties. As of December 31, 2007, Mr. Peters and Ms. Biller had received their performance-based bonuses of $100,000 each from our advisor. Effective January 30, 2008 and March 4, 2008, Scott D. Peters and Andrea R. Biller, respectively, waived their rights to receive all future retention bonuses.

D. Fleet Wallace, W. Brand Inlow, Edward A. Johnson, Gary T. Wescombe and Gary H. Hunt, our Trustees (and previously independent directors of G REIT), were entitled to receive certain milestone payments of $25,000 on each of December 31, 2007 and 2006 for serving as members of G REIT’s board of directors and G REIT’s special committee. Our Trustees (and previously as the independent directors of G REIT) are also entitled to receive a milestone payment of $50,000 when we have made aggregate liquidating distributions of at least $11.00 per unit to our beneficiaries. Assuming that our Trustees receive the maximum amount of milestone payments for serving as our Trustees and for previously serving as members of G REIT’s board of directors and G REIT’s special committee, they will each receive aggregate payments of up to $100,000. As of March 24, 2008, based upon the satisfaction of performance milestones, each of Messrs. Hunt, Inlow, Johnson, Wallace and Wescombe have received milestone payments of $50,000 each from G REIT and/or G REIT Liquidating Trust.

Real Estate Commissions

In August 2006, Jeffrey T. Hanson was appointed to serve as a member of the then Board of Managers and the Managing Director-Real Estate of our advisor and the President and Chief Executive Officer of Realty. Prior to his employment with our advisor and Realty, Mr. Hanson was employed with Grubb & Ellis Co. In connection with his previous employment with Grubb & Ellis Co., and subsequent to his employment with our advisor and Realty, Mr. Hanson has been paid real estate commissions of approximately $309,000 relating to transactions involving properties sold by G REIT.

Related Party Accounts Receivable/Payable

Related party accounts receivable consists primarily of amounts due to us from our advisor and affiliates. Related party accounts payable consists primarily of amounts due from us to our advisor and affiliates.

101

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

Review, Approval or Ratification of Transactions with Related Persons

All transactions between us and any related person, including our advisor and its affiliates, are reviewed and approved by our Trustees. Additionally, the plan of liquidation provides that we may sell our remaining assets to one of our affiliates or an affiliate of our advisor. If we enter such a transaction, we expect that our Trustees will require that Stanger, or another independent consultant, opine to us as to the fairness of the consideration to be received by us in such transaction, from a financial point of view, or conduct an appraisal of the applicable property as a condition to their approval. In no event will our Trustees approve a transaction if: (i) Stanger, or another independent consultant, concludes after a review of the information then available, including any pending offers, letters of intent, contracts for sale, appraisals or other data, that the consideration to be received by us is not fair to us from a financial point of view; (ii) Stanger, or another independent consultant, concludes that the consideration to be received is less than the appraised value of the applicable property; or (iii) we have received a higher offer for the applicable property from a credible party with whom we reasonably believe is ready, able and willing to close the transaction on the contract terms.

13.   Commitments and Contingencies

Operating Leases

The Sutter Square Galleria property is subject to a ground lease expiring in 2040 with one ten-year option period thereafter. Future minimum rents to be paid under this non-cancelable operating lease are computed at 12.5% of gross rents, as defined in the ground lease agreement.

The aggregate ground lease rent for the years ended December 31, 2007, 2006 and 2005 was $162,000, $372,000 and $515,000, respectively. We do not have any future minimum ground lease obligations under noncancelable leases as of December 31, 2007 as a result of the sale of our 600 B Street and Atrium Building properties during the year ended December 31, 2006.

SEC Investigation

On September 16, 2004, our advisor advised G REIT that it learned that the SEC Los Angeles Enforcement Division, or the SEC Staff, was conducting an investigation referred to as “In the matter of Triple Net Properties, LLC.” The SEC has requested information from our advisor relating to disclosure in public and private securities offerings sponsored by our advisor and its affiliates, or the Triple Net securities offerings (including offerings by G REIT). The SEC has requested financial and other information regarding the Triple Net securities offerings and the disclosures included in the related offering documents.

Our advisor is engaged in settlement negotiations with the SEC Staff regarding this matter. Based on these negotiations, our advisor believes that the conclusion to this matter will not result in a material adverse affect to its results of operations, financial condition or ability to conduct our business. The settlement negotiations are continuing, and any settlement negotiated with the SEC Staff must be approved by the Commissioners. Since the matter is not concluded, it remains subject to the risk that the SEC may seek additional remedies, including substantial fines and injunctive relief against our advisor that, if obtained, could materially adversely affect our advisor’s ability to perform its duties to us. The matters that are the subject of this investigation could also give rise to claims against our advisor by investors in its existing real estate investment programs which could adversely affect our advisor’s performance with respect to us. At this time, we cannot assess how or when the outcome of the matter will be ultimately determined and its impact on us. Therefore, at this time, we have not accrued any loss contingencies in accordance with SFAS No. 5, Accounting for Contingencies.

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

Prior Performance Tables

In connection with G REIT’s initial and second public offerings of common stock conducted through “best efforts” offerings from July 22, 2002 through April 30, 2004, G REIT disclosed the prior performance of all public and private investment programs sponsored by our advisor. Our advisor determined that there were certain errors in those prior performance tables. In particular, the financial information in the tables was stated to be presented on a GAAP basis. Generally the tables for the public programs were not presented on a GAAP basis and the tables for the private programs were prepared and presented on a tax or cash accounting basis. Moreover, a number of the prior performance data figures were themselves erroneous, even as presented on a tax or cash basis. In particular, certain programs sponsored by our advisor have invested either along side or in other programs sponsored by our advisor. The nature and results of these investments were not fully and accurately disclosed in the tables. In addition, for the private programs certain calculations of depreciation and amortization were not on an income tax basis for limited liability company investments; certain operating expenses were not reflected in the operating results; and monthly mortgage and principal payments were not reported. In general, the resulting effect is an overstatement of our advisor’s program and aggregate portfolio operating results. At this time there is no litigation related to the prior performance tables.

Revised prior performance tables reflecting corrected numbers and disclosures from those initially included in G REIT’s prospectuses dated July 22, 2002 and January 23, 2004 were included in each of G REIT’s definitive proxy statement and G REIT’s Current Report on Form 8-K filed with the SEC on January 13, 2006.

Litigation

Neither we nor any of our properties are presently subject to any other material litigation nor, to our knowledge, is any material litigation threatened against us or any of our properties which if determined unfavorably to us would have a material adverse effect on our cash flows, financial condition or results of operations. We are a party to litigation arising in the ordinary course of business, none of which if determined unfavorably to us, individually or in the aggregate, is expected to have a material adverse effect on our cash flows, financial condition or results of operations.

Environmental Matters

We follow the policy of monitoring our properties for the presence of hazardous or toxic substances. While there can be no assurance that a material environmental liability does not exist, we are not currently aware of any environmental liability with respect to the properties that would have a material effect on our financial condition, results of operations and cash flows. Further, we are not aware of any environmental liability or any unasserted claim or assessment with respect to an environmental liability that we believe would require additional disclosure or the recording of a loss contingency.

Unconsolidated Debt

Total mortgage debt of our unconsolidated property, Congress Center located in Chicago, Illinois, or, the Congress Center property was $96,101,000 and $97,308,000 as of December 31, 2007 and 2006, respectively. Our share of the unconsolidated debt, based on our ownership percentage, was $28,830,000 and $29,192,000 as of December 31, 2007 and 2006, respectively.

On December 21, 2006, Realty received a termination notice from Employer’s Reinsurance Corporation notifying Realty of its intent to exercise its option to terminate its lease effective January 1, 2008 at the Congress Center property. Effective January 1, 2008, Employer’s Reinsurance Corporation’s lease was terminated. Pursuant to the Property Reserves Agreement with the lender under our mortgage debt, the lender

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

was entitled to receive an early termination fee penalty of $3,800,000 from the borrower (all the co-owners of the Congress Center property) to be placed in a reserve account controlled by the lender. In addition, the lender was entitled to receive $225,000 on a monthly basis beginning January 1, 2007 and continuing through and including the payment date occurring on December 1, 2007 from the borrower. Beginning January 1, 2008 and continuing through and including the payment date occurring on December 1, 2011, the lender is entitled to receive $83,000 on a monthly basis from the borrower. In the event that the Congress Center property does not generate sufficient funds from operations to satisfy the monthly reserve payments to the lender, it is anticipated that the borrower will obtain an unsecured loan from our advisor or its affiliates or NNN 2002 Value Fund, LLC, or our affiliate co-owner, will advance the required amounts to the lender on behalf of the borrower. In January 2007, Employer’s Reinsurance Corporation paid $3,773,000 to the lender as an early termination fee penalty pursuant to their lease agreement. G REIT, along with T REIT Liquidating Trust (successor of T REIT, Inc.) and our affiliate co-owner paid the remaining $27,000 of the early termination fee penalty owed to the lender. As of December 31, 2007, G REIT has advanced $273,000 to the lender for the reserves associated with the early lease termination. It is anticipated that upon the sale of the Congress Center property, we, along with T REIT Liquidating Trust (successor of T REIT, Inc.) and our affiliate co-owner, will receive repayment of any advances made to the lender for reserves. All payments to the lender are to be placed in a reserve account to be held by the lender for reimbursement to the borrower for tenant improvement and leasing commissions incurred in connection with re-leasing the space. Realty has begun marketing efforts to re-lease the space as a result of the lease termination on January 1, 2008; however, our failure to replace this tenant may reduce or delay our liquidating distributions to our beneficiaries.

The Congress Center property is required by the terms of the applicable loan documents to meet certain minimum loan to value, performance covenants and other requirements. As of December 31, 2007, the Congress Center property was in compliance with all such covenants.

Other

Our commitments and contingencies include the usual obligations of real estate owners and operators in the normal course of business. In the opinion of management, these matters are not expected to have a material impact on our consolidated financial position and results of operations.

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

14.   Discontinued Operations — Properties Held for Sale

Prior to adoption of the plan of liquidation, in accordance with SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, the net income and the net gain on dispositions of operating properties sold subsequent to December 31, 2004 classified as held for sale are reflected in the consolidated statement of operations as discontinued operations for all periods presented. In accordance with the plan of liquidation, all of our operating properties for all periods presented are considered discontinued operations. The following tables summarize the properties held for sale and income (loss) and expense components that comprise discontinued operations for the year ended December 31, 2005:

Property	Date Purchased	Date Sold
5508 West Highway 290 Building	September 13, 2002	November 14, 2006
Two Corporate Plaza	November 27, 2002	January 11, 2007
Atrium Building	January 31, 2003	December 15, 2006
Department of Children and Family	April 25, 2003	November 15, 2006
Gemini Plaza	May 2, 2003	December 29, 2006
Bay View Plaza	July 31, 2003	November 6, 2007
North Pointe Corporate Center	August 11, 2003	September 14, 2007
824 Market St.	October 10, 2003	June 29, 2007
Sutter Square Galleria	October 28, 2003	—
One World Trade Center	December 5, 2003	March 22, 2007
Centerpoint Corporate Park	December 30, 2003	October 17, 2006
AmberOaks Corporate Center	January 20, 2004	September 29, 2006
Public Ledger Building	February 13, 2004	November 22, 2006
Madrona Buildings	March 31, 2004	August 2, 2007
Brunswig Square	April 5, 2004	October 6, 2006
North Belt Corporate Center	April 8, 2004	June 29, 2007
Hawthorne Plaza	April 20, 2004	September 14, 2006
Pacific Place	May 26, 2004	—
525 B Street — Golden Eagle	June 14, 2004	August 10, 2005
600 B Street — Comerica	June 14, 2004	July 18, 2006
Western Place I & II	July 23, 2004	—
Pax River Office Park	August 6, 2004	March 12, 2008
One Financial Plaza	August 6, 2004	March 30, 2007
Opus Plaza at Ken Caryl	September 12, 2005	July 23, 2007
Eaton Freeway Industrial Park	October 21, 2005	September 14, 2007

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

	Year Ended
	December 31,
	2005
Revenues
Rental income	$	118,912,000
Interest income		216,000
		119,128,000
Expenses
Rental expenses		56,310,000
Depreciation and amortization		39,027,000
Interest expense (including amortization of deferred financing costs)		28,189,000
Minority interest		(183,000	)
Loss from discontinued operations — properties held for sale, net		(4,215,000	)
Gain on sale of real estate		10,550,000
	$	6,335,000

Intangible Assets

Amortization expense recorded on the identified intangible assets, for each of fiscal years ended December 31, 2005 was $16,030,000.

As of December 31, 2005, all intangible assets and related accumulated amortization balances were adjusted to net realizable value.

Intangible Liabilities

Amortization expense recorded on the identified intangible liabilities, for each of fiscal years ended December 31, 2005 was $4,604,000.

As of December 31, 2005, all intangible liabilities and related accumulated amortization balances adjusted to net settlement value.

15.   Tax Treatment of Distributions

The income tax treatment for distributions reportable for the years ended December 31, 2007, 2006 and 2005 was as follows:

	December 31,
	2007				2006				2005
Ordinary income	$	—	—		$	2,829,000	1.40	%	$	3,333,000	10.12	%
Capital gain		—	—			—	—			11,963,000	36.34	%
Return of capital		—	—			2,661,000	1.32	%		17,628,000	53.54	%
Liquidating distributions		190,010,000	100.00	%		196,597,000	97.28	%		—	—
	$	190,010,000	100.00	%	$	202,087,000	100.00	%	$	32,924,000	100.00	%

Subsequent to March 31, 2006, approximately $188,912,000, or $4.30 per share, and $192,782,000, or $4.39 per share, of liquidating distributions to G REIT stockholders were paid for the years ended

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

December 31, 2007 and 2006, respectively, and are treated by stockholders as proceeds from the sale of their stock.

16.   Business Combinations

During the year ended December 31, 2005, G REIT completed the acquisition of two wholly-owned consolidated properties, adding a total of 124,000 square feet of GLA to its property portfolio. The aggregate purchase price of the two consolidated properties was $17,764,000, of which $11,700,000 was financed with mortgage debt. Realty was paid $448,000 in real estate acquisition fees in connection with these acquisitions. In accordance with SFAS No. 141, G REIT allocated the purchase price to the fair value of the assets acquired and the liabilities assumed, including the allocation of the intangibles associated with the in-place leases considering the following factors: lease origination costs; tenant relationships; and above or below market leases. During 2005, G REIT allocated and recorded $2,846,000 of intangible assets associated with in-place lease origination costs and tenant relationships, as well as above market leases. In addition, G REIT have recorded a lease intangible liability related to the acquired below market lease which aggregated $127,000 during 2005.

Assuming all of the 2005 acquisitions had occurred January 1, 2005, pro forma net income and net income per diluted share would have been $2.4 million and $0.05 respectively, for the year ended December 31, 2005. The pro forma results are not necessarily indicative of the operating results that would have been obtained had the acquisitions occurred at the beginning of the periods presented, nor are they necessarily indicative of future operating results.

17.   Selected Quarterly Financial Data (Unaudited)

Set forth below is the unaudited selected quarterly financial data. We believe that all necessary adjustments, consisting only of normal recurring adjustments, have been included in the amounts stated below to present fairly, and in accordance with generally accepted accounting principles, the unaudited selected quarterly financial data when read in conjunction with the consolidated financial statements.

	Liquidation Basis
	Quarters Ended
	December 31,			September 30,			June 30,			March 31,
	2007			2007			2007			2007
Net assets in liquidation, beginning of period	$	147,408,000		$	151,719,000		$	284,843,000		$	288,739,000
Change to asset for estimated receipts in excess of estimated costs during liquidation		—			85,000			(924,000	)		(1,155,000	)
Net increase (decrease) in fair value		(4,577,000	)		(1,842,000	)		2,937,000			2,282,000
Liquidating distributions to stockholders		(46,198,000	)		(2,554,000	)		(135,137,000	)		(5,023,000	)
Change in net assets in liquidation		(50,775,000	)		(4,311,000	)		(133,124,000	)		(3,896,000	)
Net assets in liquidation, end of period	$	96,633,000		$	147,408,000		$	151,719,000		$	284,843,000

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G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

	Liquidation Basis
	Quarters Ended
	December 31,			September 30,			June 30,			March 31,
	2006			2006			2006			2006
Net assets in liquidation, beginning of period	$	462,193,000		$	473,518,000		$	454,184,000		$	453,459,000
Change to asset (liability) for estimated receipts (costs) in excess of estimated (costs) receipts during liquidation		5,796,000			(542,000	)		(314,000	)		(380,000	)
Net increase (decrease) in fair value		(2,938,000	)		(2,549,000	)		27,884,000			1,105,000
Liquidating distributions to stockholders		(176,312,000	)		(8,234,000	)		(8,236,000	)		—
Change in net assets in liquidation		(173,454,000	)		(11,325,000	)		19,334,000			725,000
Net assets in liquidation, end of period	$	288,739,000		$	462,193,000		$	473,518,000		$	454,184,000

18.   Subsequent Events

Plan of Liquidation

On January 28, 2008, G REIT transferred its assets to, and its liabilities were assumed by, us in accordance with the plan of liquidation and the Liquidating Trust Agreement.

Real Estate Investments

Dispositions in 2008

Pax River Office Park — Lexington, Maryland

On March 12, 2008, we sold our Pax River Office Park property located in Lexington, Maryland to Hampshire Global Partners, LLC, an unaffiliated third party, for a sales price of $14,475,000. Our net cash proceeds from the sale were $13,984,000 after payment of closing costs and other transaction expenses. A sales commission of $253,000, or 1.7% of the sales price, was also paid to an unaffiliated broker. As compared to December 31, 2006, our net assets available in liquidation as of the sales date decreased by approximately $903,000, or $0.02 per share, as a result of the sale.

Mortgage Loans Payable Secured by Properties Held for Sale

On February 26, 2008, we, along with our co-owners, or the Western Place Owners, refinanced the Western Place I & II property’s mortgage loan with Wachovia Bank, National Association, or Wachovia, in the principal amount of $28,000,000. The loan matures on February 28, 2009, and provides for monthly interest-only payments due on the first day of each calendar month, beginning April 1, 2008. At the option of the Western Place Owners, the loan bears interest at per annum rates equal to: (a) 30-day LIBOR plus 1.65% per annum; or (b) the Prime Rate, as announced by Wachovia from time to time as its prime rate. If any monthly installment that is due is not received by Wachovia on or before the 15th day of each month, the loan provides for a late charge equal to 4.0% of such monthly installment. In the event of a default, the loan also provides for a default interest rate of 4.0% per annum plus the greater of the LIBOR Rate or the Prime Rate. The loan may be prepaid in whole or in part, without paying a prepayment premium. The loan documents contain certain customary representations, warranties, covenants and indemnities. In addition, the Western Place Owners entered into an interest rate swap agreement, or the ISDA Agreement, in conjunction with refinance of the Western Place I & II property. As a result of the ISDA Agreement, the Western Place loan bears interest at a nominal fixed rate of 6.21% per annum from February 26, 2008 through February 28, 2009; and provides

108

G REIT LIQUIDATING TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Years Ended December 31, 2007, 2006 and 2005 — (Continued)

for monthly interest-only payments due on the first business day of each calendar month commencing on April 1, 2008. As a result of the refinancing, the Western Place Owners borrowed $24,250,000. In addition, there is $3,750,000 available for general tenant improvements, leasing commissions and capital improvements under the mortgage loan, which shall be released as work or leasing costs are incurred and evidence of such costs is provided to the satisfaction of lender. As of March 24, 2008, there was $24,250,000, of which $19,036,000 represents our pro rata share, outstanding on the mortgage loan with Wachovia.

Unconsolidated Debt

In connection with the transfer of assets and liabilities from G REIT to us on January 28, 2008, we may be required to pay a transfer fee of up to $288,000 with respect to the assumption of certain debt obligations by us related to the unconsolidated property. We are in the process of working with the lender to finalize the terms of the transfer of this obligation.

Unconsolidated Debt Due to Related Parties

On February 1, 2008, the Congress Center property, of which we own 30.0%, entered into an unsecured loan with NNN Realty Advisors, evidenced by an unsecured promissory note in the principal amount of $225,000. The unsecured note provides for a maturity date of July 31, 2008, bears interest at a fixed rate of 7.64% per annum and requires monthly interest-only payments for the term of the unsecured note.

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G REIT LIQUIDATING TRUST

SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS

			Additions
	Balance at		Charged to		Charged to					Balance at
	Beginning of		Costs and		Other					End of
Description	Period		Expenses		Accounts		Deductions			Period
Year Ended December 31, 2005 — Reserve deducted from accounts receivable	$	321,000	$	—	$	—	$	(321,000	)	$	—

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G REIT LIQUIDATING TRUST

SCHEDULE III — REAL ESTATE OPERATING PROPERTIES AND ACCUMULATED
DEPRECIATION

				Initial Costs to Company				Gross Amounts at Which Carried at Close of Period
						Buildings				Buildings					Net
						and				and		Accumulated			Liquidation						Date
	Encumbrance			Land		Improvements		Land		Improvements		Depreciation(2)			Adjustment(1)			Total			Constructed
Sutter Square (Office), Sacramento, CA	$	—		$	—	$	8,414,000	$	—	$	8,538,000	$	(581,000	)	$			$	7,957,000			1987
Pacific Place (Office), Dallas, TX		—			1,230,000		24,646,000		1,230,000		26,496,000		(1,372,000	)					26,354,000			1982
Western Place I & II (Office), Fort Worth, TX		24,000,000			2,397,000		27,652,000		2,397,000		31,270,000		(1,517,000	)					32,150,000			1980
Pax River (Office), Lexington Park, MD		—			1,661,000		12,163,000		1,661,000		12,383,000		(482,000	)					13,562,000			1983
Net Liquidation Adjustment(1)		(5,160,000	)		—		—		—		—		—			(9,110,000	)		(9,110,000	)
Total	$	18,840,000		$	5,228,000	$	72,875,000	$	5,228,000	$	78,687,000	$	(3,952,000	)	$	(9,110,000	)	$	70,913,000

			Maximum Life on Which
	Date		Depreciation in Latest
	Acquired		Income Statement is Computed
Sutter Square (Office), Sacramento, CA		October 28, 2003		39 years
Pacific Place (Office), Dallas, TX		May 26, 2004		39 years
Western Place I & II (Office), Fort Worth, TX		July 23, 2004		39 years
Pax River (Office), Lexington Park, MD		August 6, 2004		39 years

(a) The changes in total real estate for the year ended December 31, 2007 are as follows:

	2007
Balance as of December 31, 2006 (liquidation basis)	$	417,384,000
Capital expenditures		3,012,000
Liquidation adjustment, net		(5,889,000	)
Disposals		(343,594,000	)
Balance as of December 31, 2007 (liquidation basis)	$	70,913,000

(1)	Under the liquidation basis of accounting, our real estate holding are now carried at their estimated fair value, as a result the net liquidation adjustment is the net adjustment that we have made to the carrying value of the property in order to reflect its fair value.
(2)	Depreciation expense has not been recorded subsequent to December 31, 2005 as a result of the adoption of the plan of liquidation, because all assets are considered held for sale.

111

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.

	G REIT LIQUIDATING TRUST (Registrant)
By	/s/  Gary T. Wescombe	Chairman of the Trustees
	Gary T. Wescombe
Date	March 24, 2008

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By	/s/  Gary T. Wescombe	Chairman of the Trustees
	Gary T. Wescombe
Date	March 24, 2008
By	/s/  Gary H. Hunt	Trustee
	Gary H. Hunt
Date	March 24, 2008
By	/s/  W. Brand Inlow	Trustee
	W. Brand Inlow
Date	March 24, 2008
By	/s/  Edward A. Johnson	Trustee
	Edward A. Johnson
Date	March 24, 2008
By	/s/  D. Fleet Wallace	Trustee
	D. Fleet Wallace
Date	March 24, 2008

112

EXHIBIT INDEX

Pursuant to Item 601(a)(2) of Regulation S-K, this Exhibit index immediately precedes the exhibits.

The following exhibits are included, or incorporated by reference, in this Annual Report on Form 10-K for the fiscal year 2007 (and are numbered in accordance with Item 601 of Regulation S-K).

Exhibit
Number			Exhibit
	2	.1	G REIT, Inc. Plan of Liquidation and Dissolution, as approved by stockholders on February 27, 2006 and as currently in effect (included as Exhibit A to our Definitive Proxy Statement filed on January 13, 2006 and incorporated herein by reference)
	3	.1	Articles of Incorporation of G REIT, Inc. (as approved by stockholders on June 29, 2004 and as currently in effect (included as Appendix B to our Definitive Proxy Statement filed on May 27, 2004 and incorporated herein by reference).
	3	.2	Bylaws of G REIT, Inc. (as approved by stockholders on June 29, 2004 and as currently in effect (included as Appendix C to our Definitive Proxy Statement filed on May 27, 2004 and incorporated herein by reference).
	4	.1	Form of our Common Stock Certificate (included as Exhibit 4.1 to our Registration Statement on Form S-11 filed on January 9, 2002 (File No. 333-76498) and incorporated herein by reference).
	10	.1	Form of Agreement of Limited Partnership of G REIT, L.P. (included as Exhibit 10.1 to our Registration Statement on Form S-11 filed on January 9, 2002 (File No. 333-76498) and incorporated herein by reference).
	10	.2	Amended and Restated Dividend Reinvestment Plan (included as Exhibit C to our Prospectus, a part of Amendment No. 2 to our Registration Statement on Form S-11 filed on January 23, 2004 (File No. 333-109640) and incorporated herein by reference).
	10	.3	Amended and Restated Stock Repurchase Plan (included as Exhibit D to our Prospectus, a part of Amendment No. 2 to our Registration Statement on Form S-11 filed on January 23, 2004 (File No. 333-109640) and incorporated herein by reference).
	10	.4	Independent Director Stock Option Plan (included as Exhibit 10.4 to Amendment No. 1 to our Registration Statement on Form S-11 filed on April 29, 2002 (File No. 333-76498) and incorporated herein by reference).
	10	.5	Officer and Employee Stock Option Plan (included as Exhibit 10.5 to Amendment No. 1 to our Registration Statement on Form S-11 filed on April 29, 2002 (File No. 333-76498) and incorporated herein by reference).
	10	.6	Advisory Agreement between G REIT, Inc. and Triple Net Properties, LLC (included as Exhibit 10.6 to our Registration Statement on Form S-11 filed on January 9, 2002 (File No. 333-76498) and incorporated herein by reference).
	10	.7	First Amendment to Advisory Agreement between G REIT, Inc. and Triple Net Properties, LLC (included as Exhibit 10.8 to Post Effective Amendment No. 1 to our Registration Statement on Form S-11 filed on December 18, 2002 (File No. 333-76498) and incorporated herein by reference).
	10	.8+	2004 Incentive Award Plan (included as Appendix A to the Definitive Proxy filed on May 27, 2004 and incorporated herein by reference).
	10	.9	Credit Agreement among G REIT, L.P., the Lenders and LaSalle Bank National Association dated as of January 31, 2003 (included as Exhibit 10.48 to Form 10-K for the fiscal year ended December 31, 2004 filed on March 31, 2005 and incorporated herein by reference).
	10	.10	First Amendment to Credit Agreement among G REIT, L.P., the Lenders and LaSalle Bank National Association dated as of April, 2003 (included as Exhibit 10.49 to Form 10-K for the fiscal year ended December 31, 2004 filed on March 31, 2005 and incorporated herein by reference).
	10	.11	Amended and Restated Credit Agreement among G REIT, L.P., the Lenders and LaSalle Bank National Association dated as of July 17, 2003 (included as Exhibit 10.50 to Form 10-K for the fiscal year ended December 31, 2004 filed on March 31, 2005 and incorporated herein by reference).

113

Exhibit
Number			Exhibit
	10	.12	First, Second, Third, Fourth, Fifth and Sixth Amendment to the Amended and Restated Credit Agreement among G REIT, L.P., the Lenders and LaSalle Bank National Association dated as of August 11, 2003, September 19, 2003, November 7, 2003, December 19, 2003, March, 2004 and August 27, 2004, respectively (included as Exhibit 10.51 to Form 10-K for the fiscal year ended December 31, 2004 filed on March 31, 2005 and incorporated herein by reference).
	10	.13	Second Amendment to Purchase and Sale Agreement by and between GREIT-One World Trade Center, L.P. and Legacy Partners Realty Fund II, LLC, dated January 5, 2007 (included as Exhibit 10.1 to Form 8-K filed on January 10, 2007 and incorporated herein by reference).
	10	.14	Third Amendment to Purchase and Sale Agreement by and between GREIT-One World Trade Center, L.P. and Legacy Partners Realty Fund II, LLC, dated January 19, 2007 (included as Exhibit 10.1 to Form 8-K filed on January 25, 2007 and incorporated herein by reference).
	10	.15	Fourth Amendment to Purchase and Sale Agreement by and between GREIT-One World Trade Center, L.P. and Legacy Partners Realty Fund II, LLC, dated January 26, 2007 (included as Exhibit 10.1 to Form 8-K filed on February 1, 2007 and incorporated herein by reference).
	10	.16	Fifth Amendment to Purchase and Sale Agreement by and between GREIT-One World Trade Center, L.P. and Legacy Partners Realty Fund II, LLC, dated January 31, 2007 (included as Exhibit 10.2 to Form 8-K filed on February 1, 2007 and incorporated herein by reference).
	10	.17	Sixth Amendment to Purchase and Sale Agreement by and between GREIT-One World Trade Center, L.P. and Legacy Partners Realty Fund II, LLC, dated February 15, 2007 (included as Exhibit 10.1 to Form 8-K filed on February 22, 2007 and incorporated herein by reference).
	10	.18	Seventh Amendment to Purchase and Sale Agreement by and between GREIT-One World Trade Center, L.P. and Legacy Partners Realty Fund II, LLC, dated February 22, 2007 (included as Exhibit 10.1 to Form 8-K filed on February 26, 2007 and incorporated herein by reference).
	10	.19	Eighth Amendment to Purchase and Sale Agreement by and between GREIT-One World Trade Center, L.P. and Legacy Partners Realty Fund II, LLC, dated February 28, 2007 (included as Exhibit 10.1 to Form 8-K filed on March 6, 2007 and incorporated herein by reference).
	10	.20	Ninth Amendment to Purchase and Sale Agreement by and between GREIT-One World Trade Center, L.P. and Legacy Partners Realty Fund II, LLC, dated March 2, 2007 (included as Exhibit 10.2 to Form 8-K filed on March 6, 2007 and incorporated herein by reference).
	14	.1	GREIT Code of Business Conduct and Ethics dated May 14, 2004 (included as Exhibit 14.1 to Form 10-K for the fiscal year ended December 31, 2004 filed by us on March 31, 2005 and incorporated herein by reference).
	10	.21*	Loan Agreement between NNN Western Place, LLC, NNN Western Place 1, LLC, NNN Western Place 2, LLC, NNN Western Place 3, LLC, NNN Western Place 4, LLC, NNN Western Place 5, LLC, NNN Western Place 6, LLC, NNN Western Place 7, LLC, GREIT-Western Place, LP and Wachovia Bank, National Association, dated February 15, 2008 and effective February 26, 2008.
	10	.22*	Promissory Note by NNN Western Place, LLC, NNN Western Place 1, LLC, NNN Western Place 2, LLC, NNN Western Place 3, LLC, NNN Western Place 4, LLC, NNN Western Place 5, LLC, NNN Western Place 6, LLC, NNN Western Place 7, LLC and GREIT-Western Place, LP in favor of Wachovia Bank, National Association, dated February 15, 2008 and effective February 26, 2008.
	10	.23*	Deed of Trust, Assignment, Security Agreement and Fixture Filing by NNN Western Place, LLC, NNN Western Place 1, LLC, NNN Western Place 2, LLC, NNN Western Place 3, LLC, NNN Western Place 4, LLC, NNN Western Place 5, LLC, NNN Western Place 6, LLC, NNN Western Place 7, LLC and GREIT-Western Place, LP in favor of Wachovia Bank, National Association, dated February 15, 2008 and effective February 26, 2008.
	10	.24*	Repayment Guaranty by Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace and Gary T. Wescombe, as Trustees of the G REIT Liquidating Trust in favor of Wachovia Bank, National Association, dated February 15, 2008 and effective February 26, 2008.

114

Exhibit
Number			Exhibit
	10	.25*	Environmental Indemnity Agreement by NNN Western Place, LLC, NNN Western Place 1, LLC, NNN Western Place 2, LLC, NNN Western Place 3, LLC, NNN Western Place 4, LLC, NNN Western Place 5, LLC, NNN Western Place 6, LLC, NNN Western Place 7, LLC, GREIT-Western Place, LP, Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace and Gary T. Wescombe, as Trustees of the G REIT Liquidating Trust, and NNN Realty Advisors, Inc. in favor of Wachovia Bank, National Association, dated February 15, 2008 and effective February 26, 2008.
	10	.26*	ISDA Agreement by and between Wachovia Bank, National Association and NNN Western Place, LLC, NNN Western Place 1, LLC, NNN Western Place 2, LLC, NNN Western Place 3, LLC, NNN Western Place 4, LLC, NNN Western Place 5, LLC, NNN Western Place 6, LLC, NNN Western Place 7, LLC and GREIT-Western Place, LP, dated January 8, 2008, as amended February 26, 2008.
	21	.1*	Subsidiaries of G REIT Liquidating Trust.
	31	.1*	Certification of Trustee, as required by Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	32	.1*	Certification of Trustee, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

*	Filed herewith.
+	Compensatory plan or arrangement.

115

EX-10.21

EXHIBIT 10.21

LOAN AGREEMENT

between
NNN WESTERN PLACE, LLC, a Delaware limited liability company,
NNN WESTERN PLACE 1, LLC, a Delaware limited liability company,
NNN WESTERN PLACE 2, LLC, a Delaware limited liability company,
NNN WESTERN PLACE 3, LLC, a Delaware limited liability company,
NNN WESTERN PLACE 4, LLC, a Delaware limited liability company,
NNN WESTERN PLACE 5, LLC, a Delaware limited liability company,
NNN WESTERN PLACE 6, LLC, a Delaware limited liability company,
NNN WESTERN PLACE 7, LLC, a Delaware limited liability company, and
GREIT — WESTERN PLACE, LP, a Texas limited partnership

and

WACHOVIA BANK, NATIONAL ASSOCIATION,
a national banking association

dated as of

February 15, 2008

LOAN AGREEMENT

          This Loan Agreement is made as of February 15, 2008 by and between WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association, whose address is Wachovia Bank, N.A., Real Estate Financial Services, General Banking Group, Mail Code: CA 6233, 15750 Alton Parkway, Irvine, California 92618 (“Lender”), and NNN WESTERN PLACE, LLC, a Delaware limited liability company (“Western Place”), NNN WESTERN PLACE 1, LLC, a Delaware limited liability company (“Western Place 1”), NNN WESTERN PLACE 2, LLC, a Delaware limited liability company (“Western Place 2”), NNN WESTERN PLACE 3, LLC, a Delaware limited liability company (“Western Place 3”), NNN WESTERN PLACE 4, LLC, a Delaware limited liability company (“Western Place 4”), NNN WESTERN PLACE 5, LLC, a Delaware limited liability company (“Western Place 5”), NNN WESTERN PLACE 6, LLC, a Delaware limited liability company (“Western Place 6”), NNN WESTERN PLACE 7, LLC, a Delaware limited liability company (“Western Place 7”), and GREIT — WESTERN PLACE, LP, a Texas limited partnership (“GREIT-Western Place”, and collectively with Western Place, Western Place 1, Western Place 2, Western Place 3, Western Place 4, Western Place 5, Western Place 6 and Western Place 7, the “Borrower”), whose address is c/o Grubb & Ellis Realty Investors, LLC, 1551 N. Tustin Avenue, Suite 300, Santa Ana, California 92705.

RECITALS

          A. Borrower has acquired or will acquire fee simple title to that certain real property located in Fort Worth, Texas, as more particularly described in Exhibit A attached hereto (collectively, the “Property”), commonly known as 6000 and 6100 Western Place, Fort Worth, Texas.

          B. Borrower has requested that Lender extend credit to it for the financing and operation of the Project (as defined herein).

          C. Lender is prepared to extend such credit in accordance with and subject to the terms and conditions set forth herein.

          NOW, THEREFORE, in consideration of the covenants and conditions herein contained, the parties agree as follows:

ARTICLE I
DEFINITIONS

          1.1 Definitions. As used herein, the following terms shall have the meanings set forth below:

          “Affiliate” of any Person means any other Person directly or indirectly controlling, controlled by or under direct or indirect common control with such Person. For purposes of this definition, “control” when used with respect to any Person means the power to

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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.

          “Agreement” shall mean this Loan Agreement, as the same may be amended, modified, supplemented, renewed and restated from time to time.

          “Appraisal” shall mean an appraisal of the “as is” value of the Property and the Improvements (i) ordered by Lender, (ii) prepared by an appraiser satisfactory to Lender, (iii) in compliance with all federal and state standards for appraisals, (iv) reviewed by Lender and (v) in form and substance satisfactory to Lender in its sole and absolute discretion; provided, however, that in reviewing such appraisals and applying such discretion, Lender will act in good faith and will consistently apply the standards generally used by Lender in the normal course of its real estate lending business in order to review and evaluate appraisals.

          “Borrower” has the meaning set forth in the preamble hereof, whose address is as set forth in the introductory paragraph to this Agreement

          “Budget” shall mean the cost breakdown/budget for the Loan attached hereto as Exhibit B, which shall set forth the costs to be paid with the Loan.

          “Business Day” shall mean a day of the year other than Saturdays, Sundays and legal holidays on which banks are required to be closed in California, Texas or North Carolina.

          “Calendar Month” shall mean any of the twelve (12) calendar months of the year. With respect to any payment or obligation that is due or required to be performed within a specified number of Calendar Months, then such payment or obligation shall become due on the day in the last of such specified number of Calendar Months that corresponds numerically to the date on which such payment or obligation was incurred or commenced; provided, however, that with respect to any obligation that was incurred or commenced on the 29th, 30th or 31st day of any Calendar Month and if the Calendar Month in which such payment or obligation would otherwise become due does not have a numerically corresponding date, such obligation shall become due on the first Business Day of the next succeeding Calendar Month.

          “CC&R’s” shall mean any and all covenants, conditions, restrictions, maintenance agreements or reciprocal easement agreements affecting the Project or any of the Property.

          “Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental Authority or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority.

          “Closing Date” shall mean the date the Mortgage is recorded in the official records of the County.

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          “Collateral” shall mean all real and personal property (whether tangible or intangible) in which a lien, encumbrance or security interest is granted in favor of Lender pursuant to the Loan Documents.

          “County” shall mean Tarrant County, Texas.

          “Day” or “Days” shall mean calendar days unless expressly stated to be Business Days.

          “Debt Service Coverage Ratio” shall mean a fraction, the numerator of which is the Net Operating Income from the Project before payment of debt service for the three-month period in question, and the denominator of which is an amount equivalent to the sum of (a) an amount, as reasonably determined by Lender, equivalent to the interest that would accrue on the Loan during such three-month period at a rate of interest equal to the greater of (i) seven and ninety-eight one-hundredths percent (7.98%) per annum, or (ii) the rate of one and one-half percent (1.50%) per annum above the Treasury Note Rate (herein defined), and (b) an amount for such period, as reasonably determined by Lender, equivalent to the amount of principal that would be payable during such three-month period according to a schedule that would fully amortize the Loan over a 30-year period given the foregoing rate of interest.

          “Default Rate” shall have the meaning assigned in the Note.

          “Environmental Indemnity” shall mean that certain Environmental Indemnity Agreement executed by Borrower and Guarantor of even date herewith.

          “Event of Default” shall mean the occurrence of any of the events listed in Section 11.1 of this Agreement.

          “ERISA” shall mean Employee Retirement Income Security Act of 1974, as the same may, from time to time, be amended.

          “Federal Funds Rate” means, for any day, the rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided, however, that (a) if the day for which such rate is to be determined is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if such rate is not so published for any Business Day, the Federal Funds Rate for such Business Day shall be the average rate charged to Lender on such Business Day on such transactions as determined by Lender.

          “Financing Statement” shall mean one or more UCC-1 financing statements authorized by Borrower, as debtor, in favor of Lender, as secured party, and perfecting Lender’s security interest in the collateral described therein, each in form and substance satisfactory to Lender, to be filed in the Office of the Secretary of State of Delaware and Texas, and in such other offices for recording or filing such statements in such jurisdictions as Lender shall desire to perfect Lender’s security interest or reflect such interest in appropriate public records.

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          “Governmental Authority” shall mean (a) any governmental municipality or political subdivision thereof, (b) any governmental or quasi-governmental agency, authority, board, bureau, commission, department instrumentality or public body, or (c) any court, administrative tribunal or public utility.

          “Guarantor” shall collectively mean the Trust Guarantor and Triple Net Guarantor.

          “Guaranty” shall collectively mean the Triple Net Guaranty and the Trust Guaranty.

          “Improvements” shall mean all on-site and off-site improvements to the Property, if any, and appurtenances now or later to be located on the Land and/or in such improvements.

          “Indebtedness” means, as to any Person (a) indebtedness created, issued, incurred or assumed by such Person for borrowed money or evidenced by bonds, debentures, notes or similar instruments; (b) all obligations of such Person to pay the deferred purchase price of property or services and all other accounts payable; (c) all indebtedness secured by a lien on any asset of such Person whether or not such indebtedness is assumed by such Person; (d) all obligations, contingent or otherwise, of such Person directly or indirectly guaranteeing any indebtedness or other obligation of any other Person or in any manner providing for the payment of any indebtedness or other obligation of any other Person or otherwise protecting the holder of such indebtedness against loss (excluding endorsements for collection or deposit in the ordinary course of business); (e) the amount of all reimbursement obligations and other obligations of such Person (whether due or to become due, contingent or otherwise) in respect of letters of credit, drafts, notes, bankers’ acceptances, surety or other bonds and similar instruments; (f) all capitalized lease obligations; (g) all other obligations that would be included as liabilities on a balance sheet prepared in accordance with GAAP; (h) all payables of such Person relating to minority interests; (i) net liabilities under Swap Contracts.

          “Indemnified Taxes” means Taxes other than Excluded Taxes.

          “Indemnitee” means Lender (and its successors and assigns) and any participating or syndicating lenders relating to the Loan.

          “Interest Rate” shall have the meaning assigned in the Note.

          “Leases” means all leases, and other occupancy or use agreements (whether oral or written), now or hereafter existing, which cover or relate to the Property or any part thereof, together with all options therefor, amendments thereto and renewals and modifications thereof.

          “Lender” shall mean Wachovia Bank, National Association, a national banking association, whose address is as set forth in the introductory paragraph to this Agreement, and its successors and assigns.

          “Lending Office” means the office, branch, subsidiary or affiliate of Lender selected by Lender, from time to time, for the funding or booking of the Loan.

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          “LLC Borrowers” means, collectively, NNN Western Place, LLC, a Delaware limited liability company, NNN Western Place 1, LLC, a Delaware limited liability company, NNN Western Place 2, LLC, a Delaware limited liability company, NNN Western Place 3, LLC, a Delaware limited liability company, NNN Western Place 4, LLC, a Delaware limited liability company, NNN Western Place 5, LLC, a Delaware limited liability company, NNN Western Place 6, LLC, a Delaware limited liability company, and NNN Western Place 7, LLC, a Delaware limited liability company

          “Loan” shall mean the loan made by Lender to Borrower pursuant to this Agreement for the refinancing of the Property and the operation of the Project.

          “Loan Amount” shall mean Twenty-Eight Million and No/100 Dollars ($28,000,000.00).

          “Loan Documents” shall mean this Agreement, the Note, the Mortgage, Financing Statements, the Guaranty, the Environmental Indemnity, the Subordination of Property Management Agreement and all other documents and instruments (other than any Swap Contracts) now or hereafter executed and delivered in connection with this Agreement and the Loan described herein.

          “London Banking Day” means a day on which dealings in dollar deposits are conducted by and between banks in the London interbank eurodollar market.

          “LP Borrower” means GREIT — Western Place, LP, a Texas limited partnership.

          “Maturity Date” shall mean the date upon which the Loan becomes due and payable, which date shall be February 28, 2009.

          “Mortgage” shall mean a Deed of Trust, Assignment, Security Agreement and Fixture Filing executed by Borrower, as trustor, and naming Lender as beneficiary, creating a first lien on the Property, the Improvements, and all other buildings, fixtures and improvements now or hereafter owned or acquired by Borrower and situated on the Property, and all rights and easements appurtenant thereto, securing indebtedness and obligations pursuant to the Loan Documents and any Swap Contracts with Lender or its Affiliates, all in form and substance acceptable to Lender, as such Mortgage may be amended, modified, supplemented, renewed and restated from time to time.

          “Net Operating Income” shall mean the amount of (a) Rental Income for the applicable three (3) month period of time in question, less (b) the amount of Operating Expenses for such period of time.

          “Non-Related Party” shall mean a person or entity that is not an Affiliate of Borrower.

          “Note” shall mean the Promissory Note of even date herewith evidencing the Loan and secured by the Mortgage, as such note may be amended, modified, supplemented, renewed or restated from time to time.

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          “Obligations” means all indebtedness and obligations owing by Borrower to Lender under the Loan Documents.

          “Operating Expenses” shall mean any and all costs and expenses incurred in connection with the Project (or which should have been incurred to operate and maintain the Project in a first class manner) during the applicable three-month time period in question as reasonably determined by Lender, including without limitation (a) taxes and assessments imposed upon the Project which are reasonably allocable to such time period, (b) bond assessments which are reasonably allocable to such time period, (c) insurance premiums for casualty insurance and liability insurance carried in connection with the Project which are reasonably allocable to such time period, (d) operating expenses incurred by Borrower for the management, operation, cleaning, leasing, maintenance and repair of the Project which are reasonably allocable to such time period, including a management fee as approved by Lender, and (e) a sufficient replacement reserve (based on an annual rate of $0.15 per foot), but excluding depreciation, debt service and capital expenditures). Operating Expenses shall not include any depreciation, interest, principal, loan fees, extension fees or other payments on the Loan.

          “Permitted Exceptions” means the matters approved by Lender as permitted exceptions of title with respect to the Property and set forth as exceptions to title in the Title Insurance Policy approved by Lender.

          “Person” shall mean a natural person, a partnership, a joint venture, an unincorporated association, a limited liability company, a corporation, a trust, any other legal entity, or any Governmental Authority.

          “Project” shall mean the Property and the Improvements.

          “Property” shall mean the real property described in Exhibit A attached hereto.

          “Rental Income” shall mean the rental income received by Borrower, as reasonably determined by Lender, for the three (3) month period of time in question from the tenant Leases of the Improvements which are then in effect (and as to which the tenants thereunder are in possession and paying rent, and are not in default) or any other income, if any, generated by Borrower’s ownership and operation of the Project.

          “Subordination of Property Management Agreement” shall mean that certain Subordination of Property Management Agreement of even date herewith executed by Borrower and property manager, in form and content satisfactory to Lender.

          “Swap Contract” shall mean any agreement, whether or not in writing, relating to any transaction that is a rate swap, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap or option, bond, note or bill option, interest rate option, forward foreign exchange transaction, interest cap, collar or floor transaction, currency swap, cross-currency rate swap, swap option, currency option or any other similar transaction (including any option to enter into the foregoing) or any combination of the foregoing, and, unless the context otherwise clearly requires, any form of master agreement published by the International Swaps and Derivatives Association, Inc., or any other master agreement, together

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with any related schedules and confirmations, as amended, supplemented, superseded or replaced from time to time, relating to or governing any or all of the foregoing.

          “TI/LC/CapEx Holdback” means the portion of the Loan in the amount of $3,750,000.00 allocated on the Budget under the “Tenant Improvements” line item.

          “TIC Agreement” means that certain Amended and Restated Tenants In Common Agreement dated as of _________, 2008, by and between each Borrower.

          “Title Company” shall mean Commonwealth Land Title Insurance Company, or such other title insurance company as Lender may approve from time to time.

          “Title Insurance Policy” shall mean a title insurance policy in the form of an American Land Title Association Loan Policy (1992) extended coverage (without revision, modification or amendment) issued by the Title Company, in form and substance satisfactory to Lender and containing such endorsements as Lender may require.

          “Triple Net Guarantor” shall mean NNN Realty Advisors, LLC, a Delaware corporation.

          “Triple Net Guaranty” shall mean that certain Repayment Guaranty of even date herewith executed by Triple Net Guarantor, in form and content satisfactory to Lender.

          “Trust Guarantor” shall mean Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace, and Gary T. Wescombe, as Trustees of the G REIT Liquidating Trust dated January 22, 2008

          “Trust Guaranty” shall mean that certain Repayment Guaranty of even date herewith executed by the Trust Guarantor, in form and content satisfactory to Lender.

          “Unmatured Event of Default” shall mean an event or condition which with notice or lapse of time, or both, would become an Event of Default.

          1.2 Accounting Terms. For purposes of this Agreement, all accounting terms not otherwise defined herein or in the Recitals shall have the meanings assigned to them in conformity with generally acceptable accounting standards and principles, consistently applied (“GAAP”).

ARTICLE II
THE LOAN

          2.1 Agreement to Lend and Borrow. Subject to the terms and conditions of this Agreement, Lender agrees to lend to Borrower and Borrower agrees to borrow from Lender the Loan Amount (or such lesser amount as Borrower requests that Lender advance). The Loan proceeds shall be used for the purposes of financing the Property and operating the Project in accordance with this Agreement, and other uses reasonably approved by Lender. All amounts advanced under the Loan and repaid shall not be re-borrowed.

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          2.2 Evidence of Indebtedness. The Loan shall be evidenced by the Note. In the event of any inconsistency between the Note and this Agreement, the provisions of this Agreement shall prevail.

          2.3 Interest Rate.

          (a) Payment. The Loan shall bear interest on the unpaid principal amount thereof at a rate per annum equal to the Interest Rate. Interest shall be payable in arrears and shall be due on the first day of each calendar month and on the Maturity Date (as it may be extended) and on the date the outstanding principal amount of the Note is repaid in full.

          (b) Rate after Default. If all or a portion of the principal amount of the Loan made hereunder or any installment of interest on the Loan shall not be paid when due (whether at the stated maturity, by acceleration or otherwise and after any applicable opportunity to cure), any such overdue principal amount and, to the extent permitted by applicable law, any overdue installment of interest on the Loan shall, without limiting any other rights of Lender, bear interest, payable on demand, for each day until paid at the Default Rate. After the occurrence and during the continuance of an Event of Default, the principal amount of the Loan (and, to the extent permitted by applicable law, all accrued interest thereon) may, at the election of Lender, bear interest at the Default Rate.

          (c) Computation of Interest. Interest in respect of the Loan shall be calculated on the basis of a 360-day year for the actual days elapsed. Each determination of an interest rate by Lender pursuant to any provision of this Agreement shall be conclusive and binding on Lender and Borrower in the absence of manifest error.

          (d) No Deductions. All payments of principal or interest under the Note shall be made without deduction of any present and future taxes, levies, imposts, deductions, charges or withholdings, which amounts shall be owed and paid by Borrower. Borrower will pay the amounts necessary such that the gross amount of the principal and interest received by Lender is not less than that required by the Note.

          (e) Order of Application. Any payments received by Lender will be applied in the following order: (1) late charges; (2) impound payments for taxes and insurance (if any); (3) interest; and (4) principal.

          2.4 Maturity of the Loan. All principal owing on the Loan, and all accrued interest and other sums owing under the Loan Documents not otherwise paid when due, shall be due and payable in full on the Maturity Date.

          2.5 Prepayment. Upon not less than thirty (30) days’ prior written notice to Lender, Borrower may prepay the Loan, in whole or in part (provided Lender shall have no obligations to readvance any repaid principal), without prepayment premium (but subject to any costs set forth in any Swap Contract should Lender in its sole discretion elect to terminate any such Swap Contract provided by Lender or its Affiliate upon any such prepayment).

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          2.6 Security. Payment of the Notes shall be secured by the following:

          (a) The Mortgage;

          (b) To the extent to which they may be assigned, all other rights, licenses, permits, franchises, authorizations, approvals and agreements relating to the use, occupancy or operation of the Project; and

          (c) The Financing Statement.

          2.7 Fees.

          (a) Loan Fee. On the Closing Date, Borrower shall pay to Lender a loan fee in the amount of One Hundred Twelve Thousand and No/100 Dollars ($112,000.00).

          (b) Extension Fees. Borrower shall pay all fees for any maturity date extension as and when due pursuant to this Agreement.

          (c) Exit Fee. Borrower shall pay to Lender an exit fee of $70,000.00. This exit fee shall be payable in full upon the first to occur of (i) any Event of Default, (ii) the Maturity Date (as it may be extended pursuant to Section 2.4 above), and (iii) repayment of the Loan in full. Notwithstanding the above, payment by Borrower of the exit fee shall be waived by Lender if (1) Borrower obtains a permanent loan from Wachovia Real Estate Capital Markets for the refinance of the Property, or (2) the Property is sold to a non-affiliated third party and the Loan is repaid in full prior to the Maturity Date. Borrower acknowledges, however, that Lender has made no commitment, express or implied, to provide any such refinance loan, and Lender is under no obligation to provide any such loan.

          2.8 Increased Costs.

          (a) If any Change in Law shall: (i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, Lender; (ii) subject Lender to any tax of any kind whatsoever with respect to this Agreement or the Loan, or change the basis of taxation of payments to Lender in respect thereof; or (iii) impose on Lender or the London interbank market any other condition, cost or expense affecting this Agreement or the Loan or participation therein; and the result of any of the foregoing shall be to increase the cost to Lender of making or maintaining the Loan (or of maintaining its obligation to make the Loan), or to reduce the amount of any sum received or receivable by Lender hereunder (whether of principal, interest or any other amount) then, upon request of Lender, Borrower will pay to Lender such additional amount or amounts as will compensate Lender for such additional costs actually incurred or reduction actually suffered.

          (b) If Lender determines that any Change in Law affecting Lender or any Lending Office of Lender or Lender’s holding company, if any, regarding capital

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requirements has or would have the effect of reducing the rate of return on Lender’s capital or on the capital of Lender’s holding company, if any, as a consequence of this Agreement, the Loan to a level below that which Lender or Lender’s holding company could have achieved but for such Change in Law (taking into consideration Lender’s policies and the policies of Lender’s holding company with respect to capital adequacy), then from time to time Borrower will pay to Lender such additional amount or amounts as will compensate Lender or Lender’s holding company for any such reduction suffered.

ARTICLE III
CONDITIONS PRECEDENT

          3.1 Closing. Lender’s obligations to close the Loan and perform under this Agreement are expressly conditioned upon (i) Borrower’s satisfaction of all of the conditions set forth in Exhibit C hereto; (ii) Borrower’s satisfaction of the conditions for disbursement set forth in Article IV (as applicable); (iii) the Title Company’s unconditional commitment to issue the Title Insurance Policy; and (iv) Borrower’s delivery to Lender of the following documents, in form and content satisfactory to Lender, duly executed (and acknowledged where necessary) by the appropriate parties thereto:

          (a) This Agreement;

          (b) The Note;

          (c) The Mortgage, which shall be duly recorded in the official records of the County;

          (d) The Financing Statements, each of which shall be duly filed with the applicable Secretary of State of each Borrower’s formation;

          (e) The Guaranty;

          (f) The Environmental Indemnity;

          (g) The Subordination of Property Management Agreement;

          (h) Assignments of all other agreements, contracts, rights, permits, licenses, entitlements, authorizations, and franchises relating to the Project, and consents to such assignments where deemed appropriate by Lender; and

          (i) Such other documents that Lender may reasonably require.

ARTICLE IV
LOAN DISBURSEMENTS

          4.1 Recordation Disbursements. Upon recordation of the Mortgage and satisfaction of all conditions set forth herein, provided that the Title Company has issued or is

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irrevocably committed in writing to issue to Lender the Title Insurance Policy referred to in Section 5.1 hereof, Lender shall disburse to Borrower the entirety of the Loan proceeds minus the TI/LC/CapEx Holdback.

          4.2 Subsequent Disbursements. Subsequent to recordation of the Mortgage and subject to the provisions of this Agreement, Borrower shall be entitled to disbursements of sums as are required to be used for the payment of leasing commissions, tenant improvements and other capital expenditures as set forth below.

          4.3 Limitations and Conditions on Disbursements. In addition to the conditions precedent set forth in Sections 3.1 and 4.1 above, Borrower shall be entitled to disbursement of the Loan only in accordance with the terms and conditions of this Agreement (unless waived or modified by Lender) and, in addition, the following conditions (unless waived or modified by Lender):

          (a) The representations and warranties of Borrower contained in all of the Loan Documents shall be correct in all material respects on and as of the date of the disbursement as though made on and as of that date and no Event of Default or Unmatured Event of Default shall have occurred and be continuing as of the date of the disbursement;

          (b) No mechanics’ lien shall have been recorded against the Property that has not been released or bonded over; and

          (c) Lender shall be satisfied that the advance will not be junior in priority to any mechanics’ or materialmen’s liens or any intervening or other liens on the Property other than Permitted Exceptions.

          (d) Excluding the initial advance of the Loan, all advances of the Loan shall be limited to the purposes and amounts set forth in the categories set forth in the Budget; provided that notwithstanding any limitations on disbursements set forth in this Agreement, the budget, or otherwise, Borrower shall pay all costs and expenses arising in connection with the Project;

          (e) Lender shall not be required to make any requested advance (excluding the initial advance of the Loan) before five (5) days after the receipt of a written request therefor from Borrower, and in any event until all applicable conditions and requirements in this Agreement have been satisfied;

          (f) Lender shall have no obligation to make advances from the TI/LC/CapEx Holdback more often than once in any one month period; and

          (g) Advances from the TI/LC/CapEx Holdback for capital expenditures and tenant improvements shall be made on the following conditions (in addition to those specified in Sections 4.2(a)-(f) above):

          (1) Each request for such an advance shall specify the amount requested, shall be on forms satisfactory to Lender, and shall be accompanied by

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appropriate invoices, bills paid affidavits, lien waivers, title updates, endorsements to the title insurance, and other documents as may be required by Lender.

          (2) Borrower shall not use any portion of an advance from the TI/LC/CapEx Holdback for payment of any other cost except as specifically set forth in a request for advance approved by Lender in writing.

          (3) For advances from the TI/LC/CapEx Holdback to be used for tenant improvements, Borrower shall have submitted and Lender shall have approved (a) the lease for which the tenant improvements are to be constructed, and (b) a schedule of the tenant improvements setting forth (i) each item of tenant improvements which Borrower or the applicable tenant intends to undertake; (ii) the estimated cost of each such item, and (iii) the time schedule for completing the tenant improvements.

          (4) All tenant improvements constructed by Borrower prior to the date an advance from the TI/LC/CapEx Holdback for tenant improvements is requested shall be completed to the satisfaction of Lender in accordance with the plans therefor approved by the tenant under the applicable lease; provided that to the extent the construction scheduled for any such tenant improvements contemplates that construction will extend beyond the date of the tenant improvements advance, such construction shall be completed prior to the date of the tenant improvements advance to the extent set forth in the construction schedule.

          (5) Each advance from the TI/LC/CapEx Holdback for capital expenditures and tenant improvements, except for a final advance from the TI/LC/CapEx Holdback, shall be in the amount of actual costs incurred or to be incurred less ten percent (10%) of such costs as retainage to be advanced as part of a final advance from the TI/LC/CapEx Holdback (however, the retainage will be advanced on a per-leased premises basis if the conditions contained in Section 4.3(g)(6) are met for the applicable leased premises).

          (6) As a condition to the funding of the final advance from the TI/LC/CapEx Holdback for tenant improvements for any space in the Project:

          (1) the tenant under the lease is in occupancy, has accepted the leased premises and is paying rent under the lease, without offset, credit or defense, as evidenced by a tenant estoppel certificate executed by such tenant, addressed to Lender, in form satisfactory to Lender;

          (2) the brokers to whom lease commissions are payable have acknowledged payment in full of all commissions due with respect to the lease in question and have released Lender, Borrower, the Project and the lease from all commissions due with respect to such lease (however,

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this acknowledgment and release may be received immediately after such final advance is advanced); and

          (3) Borrower shall have furnished Lender with (i) a true and correct copy of the final and unconditional certificate of occupancy for the space under said lease, issued without restriction by the appropriate governmental authority having jurisdiction over the Project; and (ii) final original lien waivers (conditioned only upon receipt of funds from the final advance) executed by each contractor, subcontractor and materialmen supplying labor or materials for the tenant improvements.

          (7) As a condition to the funding of the final advance from the TI/LC/CapEx Holdback for capital expenditures for any space in the Project, Borrower shall have furnished Lender with final original lien waivers (conditioned only upon receipt of funds from the final advance) executed by each contractor, subcontractor and materialmen supplying labor or materials for the “other improvements” construction referred to in the Budget.

          (h) Advances from the TI/LC/CapEx Holdback for leasing commissions shall be made to pay leasing commissions in accordance with written leasing commission agreements approved in writing by Lender (however, Lender shall only have such right of approval with respect to leasing commission agreements entered into after the Closing Date); however, Lender shall not be obligated to make any advance from the TI/LC/CapEx Holdback for leasing commissions for any portion of any leasing commission until the executed lease, as approved by Lender, is delivered to Lender, at which time Lender shall make an advance from the TI/LC/CapEx Holdback for leasing commissions of not more than fifty percent (50%) of the leasing commission. The remaining portion of any leasing commission shall be advanced only when (i) the tenant under the lease is in occupancy, has accepted the leased premises and is paying rent under the lease, without offset, credit or defense, as evidenced by a tenant estoppel certificate executed by such tenant, addressed to Lender, in form satisfactory to Lender, and (ii) the brokers to whom such commissions are payable have acknowledged payment in full of all commissions due with respect to the lease and have released Lender, Borrower, the Project and the lease from all commissions due with respect to such lease (however, this acknowledgment and release may be received immediately after such applicable remaining portion for any leasing commission is advanced).

          4.4 Debt Service Coverage Ratio. At all times during the term of the Loan, the Debt Service Coverage Ratio shall equal or exceed 1.25:1.00 as determined by Lender in its sole and absolute discretion; provided, however, if the Maturity Date of the Loan is extended pursuant to Section 2.4 above, at all times thereafter during the term of the Loan, the Debt Service Coverage Ratio shall equal or exceed 1.30:1.00, as determined by Lender in its sole and absolute discretion. If for any reason the applicable Debt Service Coverage Ratio is not met, then Borrower shall, within thirty (30) days after Lender’s demand, immediately reduce the unpaid principal balance of the Loan in an amount which would cause the applicable Debt Service Coverage Ratio to be met.

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ARTICLE V
TITLE INSURANCE

          5.1 Basic Insurance. Concurrently with the recording of the Mortgage, Borrower shall, at Borrower’s sole cost and expense, deliver or cause to be delivered to Lender the Title Insurance Policy issued by the Title Company (and such reinsurers and coinsurers as Lender may require) with a liability limit of not less than the full amount of the Loan and with coverage and in form satisfactory to Lender, insuring Lender’s interest under the Mortgage as a valid first lien on the Project, together with such reinsurance or coinsurance agreements or endorsements to the Title Insurance Policy as Lender may require, which policy shall contain only the Permitted Exceptions from its coverage, and thereafter Borrower shall, at its own cost and expense, do all things necessary to maintain the Mortgage as a valid first lien on the Property.

          5.2 Intentionally Omitted.

ARTICLE VI
OPERATION AND MAINTENANCE OF THE PROJECT

          6.1 Operation as First Class Commercial Office Buildings. At all times during the term of this Agreement, Borrower shall itself (or through a manager satisfactory to Lender) operate the Project as first class commercial office buildings.

          6.2 Maintenance. Borrower shall at all times maintain the Project in good condition and repair (as is more fully set forth in the Mortgage).

ARTICLE VII
LIABILITY, RISK, AND FLOOD INSURANCE

     At all times throughout the Loan term Borrower shall, at its sole cost and expense, maintain insurance, and shall pay, as the same becomes due and payable, all premiums in respect thereto, including, but not necessarily limited to:

          7.1 Property. “Special Cause of Loss” insurance on the Improvements in an amount not less than the full insurable value on a replacement cost basis of the insured Improvements and personal property related thereto.

          7.2 Liability. Insurance protecting Borrower and Lender against loss or losses from liability imposed by law or assumed in any written contract and arising from personal injury, including bodily injury or death, having a limit of liability of not less than One Million Dollars ($1,000,000) (combined single limit for personal injury and property damage) and an umbrella excess liability policy in an amount not less than Fifteen Million Dollars ($15,000,000) protecting Borrower and Lender against any loss or liability or damage for personal injury, including bodily injury or death, or property damage. Such policies must be written on an occurrence basis so as to provide blanket contractual liability, broad form property damage coverage, and coverage for products and completed operations.

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          7.3 Additional Insurance. Borrower shall provide such other policies of insurance as Lender may reasonably request in writing.

          7.4 Other Requirements. All required insurance shall be procured and maintained in financially sound and generally recognized responsible insurance companies selected by Borrower and subject to the approval of Lender. Such companies should be authorized to write such insurance in the State of Texas. The company issuing the policies shall have a financial and performance rating of “A-IX” or better by A.M. Best Co., in Bests’ Key Guide, or such other rating acceptable to Lender. All property policies evidencing the required insurance shall name Lender as first mortgagee, and all liability policies evidencing the insurance required shall name Lender as additional insured, shall provide for payment to Lender (or its assignee, as directed by Lender) of the net proceeds of insurance resulting from any claim for loss or damage thereunder, shall not be cancelable as to the interests of Lender due to the acts of Borrower, and shall provide for at least thirty (30) days prior written notice of the cancellation or modification thereof to Lender.

          7.5 Evidence. All policies of insurance, or certificates of insurance evidencing that such insurance is in full force and effect, shall be delivered to Lender on or before the closing date (together with proof of the payment of the premiums thereof). At least thirty (30) days prior to the expiration or cancellation of each such policy, Borrower shall furnish Lender evidence that such policy has been renewed or replaced in the form of a certificate reflecting that there is in full force and effect, with a term covering the next succeeding calendar year, insurance of the types and in the amounts required.

ARTICLE VIII
RIGHTS OF INSPECTION; AGENCY

     Lender, or its agent, shall have the right at any time and from time to time to enter upon the Property for purposes of inspection and conducting Appraisals.

ARTICLE IX
REPRESENTATIONS AND WARRANTIES

          9.1 Consideration. As an inducement to Lender to execute this Agreement and to disburse the proceeds of the Loan, Borrower represents and warrants to Lender that the following statements set forth in this Article IX are true, correct and complete as of the date hereof and will be true, correct and complete as of the Closing Date and Borrower acknowledges that the truth and accuracy of such representations and warranties is also a condition precedent to Lender’s obligation to make each Loan advance.

          9.2 Organization, Powers and Good Standing.

          (a) Organization and Powers-Borrower. LLC Borrowers are each limited liability companies, duly organized and validly existing under the laws of the State of Delaware and are duly qualified to transact business as a limited liability company under the laws of the State of Texas. LP Borrower is a limited partnership, duly

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organized and validly existing under the laws of the State of Texas and is duly qualified to transact business as a limited partnership under the laws of the State of Texas. Borrower has all requisite power and authority and rights to own and operate its properties, to carry on its businesses as now conducted and as proposed to be conducted, and to enter into and perform this Agreement and the other Loan Documents. The address of Borrower’s principal place of business is 1551 N. Tustin Avenue, Suite 300, Santa Ana, California 92705.

          (b) Organization and Powers-Guarantor.

          (1) NNN Realty Advisors, Inc. is a corporation, duly organized and validly existing under the laws of the State of Delaware. Guarantor has all requisite power and authority and rights to own and operate its properties, to carry on its businesses as now conducted and as proposed to be conducted, and to enter into and perform the Environmental Indemnity and the other Loan Documents. The address of Guarantor’s principal place of business is 1551 N. Tustin Avenue, Suite 300, Santa Ana, California 92705.

          (2) G REIT Liquidating Trust dated January 22, 2008 is duly formed and validly existing, and has the power to own its assets and to transact the business in which it is now engaged.

          (c) Good Standing. LLC Borrowers have made all filings and are in good standing in the States of Delaware and Texas and in each other jurisdiction in which the character of the property they own or the nature of the business they transact makes such filings necessary or where the failure to make such filings could have a materially adverse effect on the business, operations, assets or condition (financial or otherwise) of LLC Borrowers. LP Borrowers has made all filings and is in good standing in the State of Texas and in each other jurisdiction in which the character of the property it owns or the nature of the business it transacts makes such filings necessary or where the failure to make such filings could have a materially adverse effect on the business, operations, assets or condition (financial or otherwise) of LP Borrower. Guarantor has made all filings and is in good standing in the State of Delaware and the State of Maryland and in each other jurisdiction in which the character of the property it owns or the nature of the business it transacts makes such filings necessary or where the failure to make such filings could have a materially adverse effect on the business, operations, assets or condition (financial or otherwise) of Guarantor.

          (d) Non-foreign Status. No Borrower is a “foreign corporation,” “foreign partnership,” “foreign trust,” or “foreign estate,” as those terms are defined in the Internal Revenue Code and the regulations promulgated thereunder. Each Borrower’s U.S. employer identification number is as set forth on the signature page hereof.

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          9.3 Authorization of Loan Documents.

          (a) Authorization. The execution, delivery and performance of the Loan Documents by each Borrower are within such Borrower’s powers and have been duly authorized by all necessary action by such Borrower.

          (b) No Conflict. The execution, delivery and performance of the Loan Documents by each Borrower will not violate (i) any Borrower’s operating agreement or partnership agreement or articles of organization; or (ii) to each Borrower’s knowledge, any legal requirement affecting any Borrower or any of its properties; or (iii) any agreement to which any Borrower is bound or to which it is a party and will not result in or require the creation (except as provided in or contemplated by this Agreement) of any lien upon any of such properties.

          (c) Binding Obligations. This Agreement and the other Loan Documents have been duly executed by each Borrower, and are legally valid and binding obligations of each Borrower, enforceable against each Borrower in accordance with their terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and by general principles of equity.

          9.4 Compliance with Laws. The Property consists of a legal and separate parcel or parcels under applicable law and for tax assessment purposes. The Improvements were constructed in compliance with, and the Project presently complies fully with, all restrictive covenants and all applicable laws and regulations, including, without limitation, all building codes, environmental laws and the Americans With Disabilities Act (Public Law 101-336).

          9.5 No Material Defaults. There exists no material violation of or material default by any Borrower and no event has occurred which, upon the giving of notice or the passage of time, or both, would constitute a material default with respect to (a) the terms of any instrument evidencing or securing any material indebtedness secured by the Project, (b) any material lease or other agreement affecting the Project to which any Borrower is a party, (c) to Borrower’s knowledge, any material license, permit, statute, ordinance, law, judgment, order, writ, injunction, decree, rule or regulation of any Governmental Authority, or any determination or award of any arbitrator to which any Borrower or the Project may be bound, or (d) any mortgage, instrument, agreement or document by which any Borrower, or any of its properties is bound: (i) which involves any Loan Document, (ii) that might materially and adversely affect the ability of any Borrower to perform its obligations under any of the Loan Documents, any Swap Contracts or any other material instrument, agreement or document to which it is a party, or (iii) which might adversely affect the first priority of the liens created by this Agreement or any of the Loan Documents.

          9.6 Litigation; Adverse Facts. No Borrower has knowledge of any action, suit, investigation, proceeding or arbitration (whether or not purportedly on behalf of Borrower) at law or in equity or before or by any foreign or domestic court or other governmental entity (a “Legal Action”), pending or, to the knowledge of Borrower, overtly threatened against or affecting any Borrower or any of its assets which could reasonably be expected to result in any

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material adverse change in the business, operations, assets (including the Project) or condition (financial or otherwise) of any Borrower or would materially and adversely affect any Borrower’s ability to perform its obligations under the Loan Documents. No Borrower is (a) in violation of any applicable law which violation materially and adversely affects or may materially and adversely affect the business, operations, assets (including the Project) or condition (financial or otherwise) of any Borrower, (b) subject to, or in default with respect to any other legal requirement that would have a materially adverse effect on the business, operations, assets (including the Project) or condition (financial or otherwise) of any Borrower, or (c) in default with respect to any agreement to which Borrower is a party or to which any Borrower is bound. There is no Legal Action pending or, to the knowledge of any Borrower, threatened against or affecting any Borrower questioning the validity or the enforceability of this Agreement or any of the other Loan Documents.

          9.7 Title to Properties; Liens. Borrower has good and legal title to all properties and assets reflected in its most recent balance sheet delivered to Lender, except for assets disposed of in the ordinary course of business since the date of such balance sheet. Borrower is the sole owner of, and has good and marketable title to the fee interest in the Property, and the Improvements and all other real property described in the Mortgage, free from any adverse lien, security interest or encumbrance of any kind whatsoever, excepting only (a) liens and encumbrances shown on the Title Policy, (b) liens and security interests in favor of Lender, and (c) other matters which have been approved in writing by Lender.

          9.8 Disclosure. There is no fact known to any Borrower that materially and adversely affects the business, operations, assets or condition (financial or otherwise) of any Borrower that has not been disclosed in this Agreement or in other documents, certificates and written statements furnished to Lender in connection herewith.

          9.9 Payment of Taxes. All tax returns and reports of any Borrower required to be filed by it have been timely filed, and all taxes, assessments, fees and other governmental charges upon Borrower and upon its properties, assets, income and franchises which are due and payable have been paid when due and payable.

          9.10 Securities Activities. No Borrower is not engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any margin stock (as defined within Regulations G, T and U of the Board of Governors of the Federal Reserve System), and none of the value of any Borrower’s assets consists of such margin stock. No part of the Loan will be used to purchase or carry any margin stock or to extend credit to others for that purpose or for any other purpose that violates the provisions of Regulations U or X of said Board of Governors.

          9.11 Government Regulations. No Borrower is subject to regulation under the Investment Company Act of 1940, the Federal Power Act, the Public Utility Holding Company Act of 1935, the Interstate Commerce Act or to any federal or state statute or regulation limiting its ability in incur indebtedness for money borrowed.

          9.12 Rights to Project Agreements, Permits and Licenses. Borrower is the true owner of all rights in and to all existing agreements, permits and licenses relating to the Project,

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and will be the true owner of all rights in and to all future agreements, permits and licenses relating to the Project.

          9.13 Access. All streets and easements necessary for the operation of the Project are available to the boundaries of the Property.

          9.14 Use of Project. To Borrower’s knowledge, the Improvements and the Property, and their use as commercial office buildings, comply fully with all applicable laws and restrictive covenants, including, without limitation, all zoning laws (except for certain matters which do not comply with current ADA and fire code requirements, but which complied with previous requirements, and with respect to which the city of Hayward has waived the current non-compliance).

          9.15 Financial Condition. The financial statements and all financial data previously delivered to Lender in connection with the Loan and/or relating to Borrower are true, correct and complete in all material respects. Such financial statements fairly present the financial position of the parties who are the subject thereof as of the date thereof. No material adverse change has occurred in such financial position, no borrowings have been made by any Borrower since the date thereof which are secured by, or might give rise to, a lien or claim against the Project, the proceeds of this Loan, or other assets of any Borrower.

          9.16 Personal Property. Borrower is now and shall continue to be the sole owner of the personal property constituting part of the Collateral free from any adverse lien, security interest or adverse claim of any kind whatsoever, except for liens or security interests in favor of Lender.

          9.17 No Condemnation. No condemnation proceedings or moratorium is pending or, to Borrower’s knowledge, threatened against the Project or the Property (or any portion thereof) which would materially impair the use, occupancy or full operation of the Project in any manner whatsoever.

          9.18 Other Loan Documents. Each of the representations and warranties of Borrower contained in any of the other Loan Documents is true and correct in all material respects. All of such representations and warranties are incorporated herein for the benefit of Lender.

          9.19 Guarantor. Each Guarantor has full right, power and authority to execute, deliver and carry out the terms of the Guaranty and Environmental Indemnity and, when executed and delivered pursuant thereto, the Guaranty and the Environmental Indemnity will constitute the valid, binding and legal obligations of each Guarantor, enforceable against each Guarantor in accordance with its terms subject to bankruptcy, insolvency, moratorium and similar laws affecting creditors generally and to general principles of equity.

          9.20 No Lease Defaults. There are no defaults by Borrower, to Borrower’s knowledge, or any tenant under any Lease.

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          9.21 Defects. To Borrower’s knowledge, there are no defects, facts or conditions affecting the Project which would make it unsuitable for its present use and operation as commercial office buildings.

          9.22 ERISA. As of the Closing Date and throughout the term of the Loan, (a) Borrower is not and will not be an “employee benefit plan” as defined in ERISA, and (b) the assets of Borrower do not and will not constitute “plan assets” of one or more such plans for purposes of Title I of ERISA.

ARTICLE X
COVENANTS OF BORROWER

          10.1 Consideration. As an inducement to Lender to execute this Agreement and to make each disbursement of the Loan, Borrower hereby covenants as set forth in this Article X, which covenants shall remain in effect so long as the Note shall remain unpaid or any obligation of Borrower under any other Loan Documents or under any Swap Contracts remain outstanding or unperformed.

          10.2 Existence. Each Borrower shall and shall cause each Guarantor (if other than an individual) to continue to be validly existing under the laws of the jurisdiction of its organization.

          10.3 Books and Records; Access by Lender. Borrower shall maintain a single, standard, modern system of accounting (including, without limitation, a single, complete and accurate set of books and records of its assets, business, financial condition, operations, property, prospects and results of operation in accordance with good accounting practice and on a cash basis). During business hours and upon reasonable advance written notice, Borrower will give representatives of Lender access to all assets, books, documents, property, and records of Borrower and will permit such representatives to inspect such assets and property and to audit, copy, examine and make excerpts from such books, documents and records.

          10.4 No Encumbrances. Borrower will not permit any lien, levy, attachment or restraint to be made or filed against the Project, or any portion thereof, which is not released or bonded over (to Lender’s satisfaction) within fifteen (15) days, or permit any receiver, trustee or assignee for the benefit of creditors to be appointed to take possession of the Project or any portion thereof, except for lien claims filed or asserted against the Property or the Project and concerning which Borrower is in full compliance with the applicable provisions of the Mortgage.

          10.5 Compliance with Laws. Borrower shall comply with all applicable laws, statutes, regulations, codes and requirements, as amended from time to time (including, without limitation, all environmental laws, building, zoning and use laws, requirements, regulations and ordinances, and the Americans With Disabilities Act), all CC&Rs and all obligations created by private contracts and leases which affect ownership, development, construction, equipping, fixturing, use or operation of the Project. If requested by Lender, Borrower shall deliver to Lender, promptly after receipt thereof, copies of all permits and approvals received from Governmental Authorities relating to the development, construction, use, occupancy or operation

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of the Project to the extent such items are in Borrower’s possession or are reasonably obtainable by Borrower.

          10.6 Personal Property. Borrower will not install materials, personal property, equipment or fixtures subject to any security agreement or other agreement or contract wherein the right is reserved to any person, firm or corporation to remove or repossess any such materials, equipment for fixtures, or whereby title to any of the same is not completely vested in Borrower at the time of installation, other than medical equipment purchased with purchase money financing, without Lender’s prior written consent.

          10.7 Assessments. Borrower shall pay or discharge all lawful claims, including taxes, assessments and governmental charges or levies imposed upon Borrower or its income or profits or upon any property (including the Project) belonging to Borrower (all the above collectively hereinafter referred to as “Impositions”), prior to the date upon which penalties attach thereto, and submit evidence satisfactory to Lender confirming the payment of all Impositions against the Project. Borrower has the right before any delinquency occurs to contest or object to the amount or validity of any such Imposition by appropriate proceedings, but this will not be deemed or construed in any way as relieving, modifying or extending Borrower’s covenant to pay any such Imposition at the time and in the manner provided in this Section 10.7, unless Borrower has given prior written notice to Lender of Borrower’s intent to so contest or object to an Imposition, and unless, at Lender’s sole option, (i) Borrower demonstrates to Lender’s reasonable satisfaction that the proceedings to be initiated by Borrower will conclusively operate to prevent the sale of the Collateral, or any part thereof, to satisfy such Imposition prior to final determination of such proceedings; or (ii) Borrower furnishes a good and sufficient bond or surety as requested by and reasonably satisfactory to Lender; or (iii) Borrower demonstrates to Lender’s reasonable satisfaction that Borrower has provided as good and sufficient undertaking as may be required or permitted by law to accomplish a stay of any such sale.

          10.8 Information and Statements. Borrower shall furnish to Lender:

          (a) as soon as the same are available, and in any event within one hundred twenty (120) days after the end of each fiscal year of Borrower, certified by an officer of Borrower, a copy of the current company-prepared financial statements of Borrower, prepared in accordance with sound accounting principles, consistently applied, which shall consist of (1) a balance sheet as of the end of the relevant fiscal year, (2) statements of income and expenses of Borrower for such fiscal year (together, in each case, with the comparable figures for the previous fiscal year), (3) statements of income and expenses and changes in financial position of the Project for such fiscal year (together, in each case with comparable figures for the corresponding fiscal year), and (4) cash flow statements of Borrower;

          (b) copies of filed federal income tax returns of Borrower and each Guarantor for each taxable year (with all K-1s and other forms and supporting schedules attached), on or before October 30 of each year;

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          (c) a copy of the filed Form 10-K of each Guarantor for each fiscal year, within one hundred twenty (120) days after each Guarantor’s fiscal year end;

          (d) as soon as the same are available, and in any event within forty-five (45) days after the end of each fiscal quarter of each Guarantor, certified by an officer of each Guarantor, (i) a copy of the current company-prepared financial statements of each Guarantor, prepared upon a GAAP accrual basis, and (ii) a certification that each Guarantor has met the financial covenants as set forth in Section 14 and 15 of the Guaranty, certified by an officer of each Guarantor. However, the financial statements delivered by Trust Guarantor in accordance with this Section 10.8(d) will consist of a Statement of Net Assets and a Statement of Changes in Net Assets, prepared on a liquidation GAAP basis.

          (e) as soon as the same are available, and in any event within sixty (60) days after the end of each fiscal quarter, deliver to Lender a detailed rent roll, in form and detail reasonably satisfactory to Lender, for the Project for the preceding fiscal quarter; and

          (f) such other information concerning Borrower, Guarantor, the Project, and the assets, business, financial condition, operations, property, prospects, and results of operations of Borrower and Guarantor as Lender reasonably requests from time to time.

          10.9 Representations and Warranties. Until repayment of the Note and all other obligations secured by the Mortgage, the representations and warranties of Article IX shall remain true and complete in all material respects.

          10.10 Trade Names. Borrower shall immediately notify Lender in writing of any change in the legal, trade or fictitious business names used by Borrower and shall, upon Lender’s request, execute any additional financing statements and other certificates necessary to reflect the change in trade names or fictitious business names.

          10.11 Further Assurances. Borrower shall execute and deliver from time to time, promptly after any request therefor by Lender, any and all instruments, agreements and documents and shall take such other action as may be necessary or desirable in the opinion of Lender to maintain, perfect or insure Lender’s security provided for herein and in the other Loan Documents, including, without limitation, the authorization of UCC-1 renewal statements, the execution of such amendments to the Mortgage and the other Loan Documents and the delivery of such endorsements to the Title Company, all as Lender shall reasonably require, and Borrower shall pay all fees and expenses (including reasonable attorneys’ fees) related thereto. Promptly upon the request of Lender, Borrower shall execute and deliver a Certification of Non- Foreign Status.

          10.12 Notice of Litigation.

          (a) Borrower shall give, or cause to be given, prompt written notice to Lender of (a) any action or proceeding which is instituted by or against any Borrower or Trust Guarantor in any Federal or state court or before any commission or other

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regulatory body, Federal, state or local, foreign or domestic, or any such proceedings which are threatened in writing against it, which, if adversely determined, would be likely to have a material and adverse effect upon any Borrower’s or Trust Guarantor’s (as applicable) business, operations, properties, assets, management, ownership or condition (financial or otherwise), (b) any other action, event or condition of any nature which may have a material and adverse effect upon any Borrower’s or any Guarantor’s (as applicable) business, operations, management, assets, properties, ownership or condition (financial or otherwise), or which, with notice or lapse of time or both, would constitute an Event of Default or a default under any other contract, instrument or agreement to which Borrower or any Guarantor is a party to by or to which Borrower or any Guarantor or any of their properties or assets may be bound or subject, and (c) any actions, proceedings or notices adversely affecting the Project or Lender’s interest therein by any zoning, building or other municipal officers, offices or departments having jurisdiction with respect to the Project.

          (b) Borrower shall give, or cause to be given, prompt written notice to Lender of (a) any action or proceeding which is instituted by or against Triple Net Guarantor in any Federal or state court or before any commission or other regulatory body, Federal, state or local, foreign or domestic, or any such proceedings which are threatened in writing against it, which, if adversely determined, would be likely to have a material and adverse effect upon its business, operations, properties, assets, management, ownership or condition (financial or otherwise).

          10.13 Good Standing. LLC Borrowers shall each maintain their good standing in Delaware and Texas and preserve their existence and all rights and franchises material to their business, and LP Borrower shall maintain its good standing in Texas and preserve its existence and all rights and franchises material to its business. Each Borrower shall cause Guarantor (if other than an individual) to maintain and preserve its existence.

          10.14 Hazardous Materials. Borrower will not use, and will not permit the use of, any Hazardous Substance (as defined in the Environmental Indemnity) in connection with the Project except as permitted by applicable law and the Environmental Indemnity.

          10.15 Intentionally Omitted.

          10.16 Government Regulation. No Borrower shall (a) be or become subject at any time to any law, regulation, or list of any government agency (including, without limitation, the U.S. Office of Foreign Asset Control list) that prohibits or limits Lender from making any advance or extension of credit to any Borrower or from otherwise conducting business with any Borrower, or (b) fail to provide documentary and other evidence of each Borrower’s identity as and when requested by Lender at any time to enable Lender to verify each Borrower’s identity or to comply with any applicable law or regulation, including, without limitation, Section 326 of the USA Patriot Act of 2001, 31 U.S.C. Section 5318.

          10.17 Negative Covenants. Borrower shall not, without the prior written consent of Lender in Lender’s sole and absolute discretion, do or permit to be done any of the following:

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          (a) Indebtedness. Borrower shall not incur or become liable for any Indebtedness, whether secured or unsecured, in favor of any Person, other than:

          (1) the Loan;

          (2) trade debt incurred in the ordinary course of each Borrower’s business and paid in the ordinary course of each Borrower’s business and in any event in not more than sixty (60) days; and

          (3) obligations under Swap Contracts permitted under Section 12.27 hereof.

          (b) Liens and Encumbrances. No Borrower shall create, incur or suffer to exist any lien or encumbrance (which is not released or bonded over, to Lender’s satisfaction, within fifteen (15) days) in, of or on any of the property of such Borrower except for Permitted Exceptions.

          (c) Fundamental Changes. Borrower shall not, and Borrower shall not permit Guarantor to, dissolve or liquidate or become a party to any merger or consolidation.

          (d) Distributions. No Borrower shall declare or pay any distributions or redeem, repurchase or otherwise acquire or retire any of its capital stock or other ownership interest at any time outstanding, except that, for so long as no Event of Default or Unmatured Event of Default has occurred and is continuing, each Borrower may make distributions to its members so long as after giving effect to any such distribution no Event of Default or Unmatured Event of Default shall have occurred.

          (e) Affiliates. No Borrower shall enter into any transaction (including the purchase or sale of any property or service) with, or make any payment or transfer to, any Affiliate of any Borrower except in the ordinary course of business and pursuant to the reasonable requirements of such Borrower’s business and upon fair and reasonable terms no less favorable to Borrower than Borrower would obtain in a comparable arms-length transaction.

          (f) Amendments to Organizational Documents. No Borrower shall allow any amendments to be made in the terms of any Borrower’s or any Guarantor’s organizational documents which would adversely effect in any material respect Borrower, Guarantor, the Project, any Borrower’s or any Guarantor’s ability to perform their obligations under the Loan Documents or Lender’s security interests.

          (g) No Other Business. Borrower will not engage in any business other than the ownership, management, and operation of the Project and Borrower will conduct and operate its business as presently conducted and operated.

          (h) No Commingling. No Borrower shall commingle its funds and other assets with those of any Borrower, any Affiliate, Guarantor, any of Borrower’s members, managers, partners or shareholders or any other Person.

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          (i) Changes. Borrower will not change or in any manner cause or seek a change in any laws, requirements of Governmental Authorities or obligations created by private contracts and leases which now or hereafter may significantly adversely affect the ownership, use or operation of the Project, without the prior written consent of Lender.

          (j) Change in Ownership. Borrower will not suffer to occur or exist, whether occurring voluntarily or involuntarily, any change in, or lien or encumbrance with respect to the legal or beneficial ownership of any interest in Borrower, any member in Borrower or any other direct or indirect ownership interest in Borrower or the members in Borrower, except as permitted in the Loan Documents.

          (k) Leases. Borrower shall not enter into, amend or modify any lease in excess of 5,000 square feet (each such lease, a “Material Lease”) covering any portion of the Project without Lender’s prior written consent, in Lender’s sole discretion; provided, however, Borrower shall also not enter any lease which is not a Material Lease for which the rent payable under such lease is not a market rent or the terms are not otherwise market without Lender’s prior written consent, in Lender’s sole discretion. Borrower shall furnish to Lender, upon execution, a fully executed copy of each lease entered into by Borrower, together with all exhibits and attachments thereto and all amendments and modifications thereof. Borrower shall provide Lender with a copy of each proposed Material Lease and with financial information on the proposed tenant to aid Lender in determining whether it will consent thereto. Lender may declare each such Material Lease (or any other lease) to be prior or subordinate to the Mortgage, at Lender’s sole option.

          10.18 TIC Agreement. The TIC Agreement and any rights of Borrower thereunder shall be subordinate to the Mortgage pursuant to the terms of the TIC Agreement. A memorandum of the TIC Agreement shall be duly recorded in the Official Records of Tarrant County, Texas substantially concurrently with, but subsequent to the recording of, the Mortgage. The TIC Agreement shall not be amended, modified or terminated without Lender’s prior, written consent.

          10.19 Partition. So long as any portion of the Loan remains outstanding, no Person comprising the Borrower shall seek the partition and sale of the Project (or any interest therein), whether voluntarily, by court order or otherwise.

          10.20 Bankruptcy by a Borrower. If any Person comprising the Borrower becomes the subject of any voluntary or involuntary case or proceeding which seeks liquidation, reorganization or other relief with respect to its debts or other liabilities under any bankruptcy, insolvency or other similar law now or hereafter in effect, then the other Persons comprising the Borrower shall have the right to purchase the bankrupt Person’s interest in the Project at fair market value based on an independent MAI appraisal, and such other Persons shall promptly and diligently pursue such purchase in accordance with the TIC Agreement.

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          10.21 Post-Closing Deliveries. Borrower shall, by February 29, 2008, cause the fully-executed and notarized (by each Borrower) TIC Agreement to be recorded in the Official Records of Tarrant County, Texas.

ARTICLE XI
EVENTS OF DEFAULT AND REMEDIES

          11.1 Events of Default. The occurrence of any one or more of the following shall constitute an Event of Default under this Agreement:

          (a) Failure of Borrower or Guarantor to pay any amounts due pursuant to this Agreement, the Note or the Loan Documents (including, without limitation, principal, interest, fees, or other amounts) within ten (10) days after the date such amount is due.

          (b) Failure by Borrower or Guarantor to pay any amount (other than principal or interest) when due under this Agreement or any other Loan Document and the expiration of ten (10) days after written notice of such failure by Lender to Borrower.

          (c) Failure by Borrower, Guarantor or any other Person referred to therein to comply with any of the provisions of Article VII or Sections 10.4, 10.16, 10.17(b), (c), (d) and (j), or 10.21.

          (d) Failure by Borrower or Guarantor to perform any other obligation, or to comply with any term or condition, applicable to Borrower or Guarantor under any Loan Document that is not referred to in another Section of this Section 11.1 and the expiration of thirty (30) days after written notice of such failure by Lender to Borrower; provided, however, that if such default is susceptible of cure but such cure cannot be accomplished with reasonable diligence within said period of time, and if Borrower commences to cure such default promptly after receipt of notice thereof from Lender, and thereafter prosecutes the curing of such default with reasonable diligence, such period of time shall be extended for such period of time as may be necessary to cure such default with reasonable diligence, but not to exceed an additional sixty (60) days.

          (e) Any representation or warranty by Borrower or Guarantor in any Loan Document is materially false, incorrect or misleading as of the date made or renewed.

          (f) The occurrence of any event (including, without limitation, a change in the financial condition, business, or operations of Borrower or Guarantor for any reason whatsoever) that materially and adversely affects the ability of Borrower or Guarantor to perform any of its obligations under the Loan Documents or under any Swap Contracts.

          (g) Borrower or Guarantor (i) is unable or admits in writing any Borrower’s or any Guarantor’s inability to pay its monetary obligations as they become due, (ii) fails to pay when due any monetary obligation, whether such obligation be direct

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or contingent, to any person in excess of $250,000, (iii) makes a general assignment for the benefit of creditors, or (iv) applies for, consents to, or acquiesces in, the appointment of a trustee, receiver, or other custodian for any Borrower or any Guarantor or the property of any Borrower or any Guarantor or any part thereof, or in the absence of such application, consent, or acquiescence a trustee, receiver, or other custodian is appointed for any Borrower or any Guarantor or the property of any Borrower or any Guarantor or any part thereof, and such appointment is not discharged within sixty (60) days.

          (h) Commencement of any case under the Bankruptcy Code, Title 11 of the United State Code, or commencement of any other bankruptcy arrangement, reorganization, receivership, custodianship, or similar proceeding under any federal, state, or foreign law by any Borrower or any Guarantor.

          (i) If a receiver, trustee or similar officer shall be appointed for any Borrower or any Guarantor or for all or any substantial part of the property of any Borrower or any Guarantor without the application or consent of Borrower or Guarantor and such appointment shall continue undischarged for a period of sixty (60) days (whether or not consecutive); or any bankruptcy, insolvency, reorganization, arrangements, readjustment of debt, dissolution, liquidation or similar proceedings shall be instituted (by petition, application, or otherwise) against any Borrower or any Guarantor and shall remain undismissed for a period of sixty (60) days (whether or not consecutive).

          (j) Any material litigation or proceeding is commenced before any Governmental Authority against or affecting any Borrower or the property of any Borrower or any part thereof and such litigation or proceeding is not defended diligently and in good faith by Borrower. Any litigation or proceeding is commenced before any Governmental Authority against or affecting any Guarantor which if decided against any Guarantor would materially adversely affect the Project or any Guarantor’s ability to perform its obligations under the Guaranty, and such litigation or proceeding is not defended diligently and in good faith by Guarantor.

          (k) A final judgment or decree for monetary damages or a monetary fine or penalty (not subject to appeal or as to which the time for appeal has expired) entered against any Borrower or any Guarantor by any Government Authority, which together with the aggregate amount of all other such judgments and decrees against Borrower or Guarantor that remain unpaid or that have not been discharged or stayed, exceeds $250,000.00, is not paid and discharged or stayed within thirty (30) days after the entry thereof.

          (l) Commencement of any action or proceeding which seeks as one of its remedies the dissolution of any Borrower.

          (m) All or any part of the property of any Borrower, or all or any part of the property of any Guarantor valued in excess of $500,000 in the aggregate, is attached, levied upon, or otherwise seized by legal process, and such attachment, levy, or seizure is not quashed, stayed, or released within thirty (30) days of the date thereof.

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          (n) The occurrence of any Accelerating Transfer (as defined in the Mortgage), unless Lender has consented to such Accelerating Transfer in its sole and absolute discretion, as more particularly provided in the Mortgage.

          (o) The occurrence of any Event of Default, as such term is defined in any other Loan Document, after taking into account applicable cure periods.

          (p) (i) A default shall occur in the payment when due (after giving effect to any applicable notice and grace periods), whether by acceleration or otherwise, with respect to indebtedness of any Borrower or any Guarantor in an aggregate amount exceeding $50,000; or (ii) a default shall occur in the performance or observance of any obligation or condition with respect to indebtedness in an aggregate amount exceeding $50,000 if the effect of such default described in this clause (ii) is to permit the acceleration of the maturity of such indebtedness.

          (q) Any Borrower, any Guarantor or any Person on behalf of Borrower or Guarantor shall claim or assert that the Loan Documents are not legal, valid and binding agreements enforceable against Borrower or Guarantor in accordance with their respective terms; or the Loan Documents shall in any way be terminated (except in accordance with their terms) or become or be judicially declared ineffective or inoperative or shall in any way cease to give or provide the respective liens, security interests, rights, titles, interests, remedies, powers or privileges intended to be created thereby.

          (r) Any Governmental Authorities take or institute action, which in the reasonable opinion of Lender, will adversely affect any Borrower’s or any Guarantor’s ability to repay the Loan or which will materially affect any Borrower’s or any Guarantor’s condition or operations, if such action remains effective for more than thirty (30) days.

          (s) Lender fails to have a legal, valid, binding, and enforceable first priority lien acceptable to Lender (subject to Permitted Exceptions) on the Property, Improvements and all other collateral.

          (t) Failure of Guarantor to perform or comply with any financial covenant or agreement contained in the Environmental Indemnity which remains uncured for thirty (30) days after written notice of such failure by Lender to Guarantor.

          (u) Any amendment, modification or termination of the TIC Agreement without Lender’s prior written consent.

          (v) All or any portion of the Project (or any interest therein) is partitioned, whether voluntarily, by court order, or otherwise, or any action is commenced by or on behalf of any Person seeking a partition of all or any portion of the Project, or any interest therein.

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          11.2 Remedies.

          (a) Notwithstanding any provision to the contrary herein or any of the other Loan Documents, upon the happening of any Event of Default under this Agreement, or upon an Event of Default under any of the other Loan Documents: (i) Lender’s obligation to make further advances of the Loan shall be suspended, and (ii) if the Event of Default shall not be cured within the applicable notice and cure periods, then Lender shall, at its option, have the remedies provided in the Loan Document breached by Borrower, including, without limitation, the option to declare all outstanding indebtedness to be immediately due and payable without presentment, demand, protest or notice of any kind, and the following remedies: Lender’s obligation to make further disbursements to Borrower shall terminate; Lender may, at its option, apply any of Borrower’s funds in its possession to the outstanding indebtedness under the Note whether or not such indebtedness is then due; and Lender may exercise all rights and remedies available to it under any or all of the Loan Documents. All sums expended by Lender for such purposes shall be deemed to have been disbursed to and borrowed by Borrower and should be secured by the Mortgage on the Property.

          (b) Effective from and after the occurrence of and during the continuance of an Event of Default, Borrower hereby constitutes and appoints Lender, or an independent contractor selected by Lender, as its true and lawful attorney-in-fact with full power of substitution for the performance of each Borrower’s obligations under this Agreement in the name of Borrower, and hereby empower said attorney-in-fact to do any or all of the following upon the occurrence of an Event of Default:

          (1) to employ attorneys to defend against attempts to interfere with the exercise of power granted hereby;

          (2) to pay, settle or compromise all existing bills and claims which are or may be liens against the Property, the Improvements or the Project;

          (3) to execute all applications and certificates in the name of Borrower, which may be required by any other contract;

          (4) to prosecute and defend all actions or proceedings in connection with the Project and to take such action, require such performance and do any and every other act as is deemed necessary with respect to the operation of the Project which any Borrower might do on its own behalf;

          (5) to let new or additional contracts to the extent not prohibited by their existing contracts; and

          (6) to take such action and require such performance as it deems necessary under any of the bonds or insurance policies to be furnished hereunder, to make settlements and compromises with the sureties or insurers thereunder, and in connection therewith to execute instruments of release and satisfaction.

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     It is understood and agreed that the foregoing power of attorney shall be deemed to be a power coupled with an interest which cannot be revoked until repayment of the Loan and performance of all other obligations under the Loan Documents or any Swap Contracts entered into pursuant to Section 12.27 hereof.

ARTICLE XII
MISCELLANEOUS

          12.1 Assignment. Borrower shall not assign any of its rights under this Agreement without the prior written consent of Lender, which may be granted or withheld in the sole and absolute discretion of Lender.

          12.2 Notices. All demands or notices required or which any party desires to give hereunder or under any other Loan Document shall be in writing (including, without limitation, telecopy, telegraphic, telex, or cable communication) and, unless otherwise specifically provided in such other Loan Document, shall be deemed sufficiently given or furnished if delivered by personal delivery, by nationally recognized overnight courier service or by certified United States mail, postage prepaid, addressed to the party to whom directed at the applicable address specified at the end of this paragraph (unless changed by similar notice in writing given by the particular party whose address is to be changed) or by facsimile. Any demand or notice shall be deemed to have been given either at the time of personal delivery or, in the case of courier or mail, as of the date of first attempted delivery at the address and in the manner provided herein, or, in the case of facsimile, upon receipt; provided that service of a demand or notice required by any applicable statute shall be considered complete when the requirements of that statute are met. Notwithstanding the foregoing, no notice of change of address shall be effective except upon actual receipt. This Section shall not be construed in any way to affect or impair any waiver of notice or demand provided in this Agreement or in any other Loan Document or to require giving of notice or demand to or upon any Person in any situation or for any reason. All notices sent to Borrower may be sent to NNN Western Place, LLC and delivery of any notices to NNN Western Place, LLC in compliance with this Section 12.2 shall be deemed to be delivery of notice to each Borrower. The addresses for notices are as follows:

If to Lender:	Wachovia Bank, National Association
	Real Estate Financial Services
	General Banking Group
	Mail Code: CA 6233
	15750 Alton Parkway
	Irvine, California 92618
	Attn: Anne McNeil

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If to Borrower:	NNN Western Place, LLC
	NNN Western Place 1, LLC
	NNN Western Place 2, LLC
	NNN Western Place 3, LLC
	NNN Western Place 4, LLC
	NNN Western Place 5, LLC NNN Western Place 6, LLC
	NNN Western Place 7, LLC
	GREIT — Western Place, LP
	c/o Grubb & Ellis Realty Investors, LLC
	1551 N. Tustin Avenue, Suite 300
	Santa Ana, California 92705
	Attn: Scott Peters
With a copy to:	Gregory Kaplan, PLC
	7 East Second Street
	Richmond, Virginia
	Attn: Joseph J. McQuade, Esq.
	Telephone: (804) 525-1785
	Facsimile: (804) 525-1885

          12.3 Authority to File Notices. Borrower irrevocably appoints Lender at its attorney-in-fact, with full power of substitution, to file for record, at Borrower’s cost and expense and in Borrower’s name, any notices of completion, notices of cessation of labor, or any other notices that Lender considers necessary or desirable to protect its security.

          12.4 Inconsistencies with the Loan Documents. In the event of any inconsistencies between the terms of this Agreement and any terms of any of the Loan Documents, the terms of this Agreement shall govern and prevail.

          12.5 No Waiver. No disbursement of proceeds of the Loan shall constitute a waiver of any conditions to Lender’s obligation to make further disbursements nor, in the event Borrower is unable to satisfy any such conditions, shall any such waiver have the effect of precluding Lender from thereafter declaring such inability to constitute a default under this Agreement.

          12.6 Lender Approval of Instruments and Parties. All proceedings taken in accordance with transactions provided for herein; all surveys, appraisals and documents required or contemplated by this Agreement and the persons responsible for the execution and preparation thereof; shall be satisfactory to and subject to reasonable approval by Lender. Lender’s counsel shall be provided with copies of all documents which they may reasonably request in connection with the Agreement.

          12.7 Lender Determination of Facts. Lender shall at all times be free to establish independently, to its satisfaction, the existence or nonexistence of any fact or facts, the existence or nonexistence of which is a condition of this Agreement.

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          12.8 Incorporation of Preamble, Recitals and Exhibits. The preamble, recitals and exhibits hereto are hereby incorporated in to this Agreement.

          12.9 Third-Party Consultants. Lender may hire such third-party consultants as it deems necessary, the costs of which shall be paid by Borrower, to provide the following services: (a) perform environmental assessments; (b) to provide Appraisals; and (c) perform such other services as may, from time to time, be reasonably required by Lender. This obligation on the part of Borrower shall survive the closing of the Loan and the repayment thereof.

          12.10 Payment of Expenses. Borrower shall pay all taxes and assessments and all expenses, charges, costs and fees provided for in this Agreement or relating to the Loan or the Project, including, without limitation, any fees incurred for recording or filing any of the Loan Documents, title insurance premiums and charges, tax service contract fees, fees of any consultants, Lender’s processing and closing fees, Lender’s inspection fees, reasonable fees and expenses of Lender’s counsel (and any counsel to any assignee of Lender to which the Loan Documents are pledged as security), printing, photostating and duplicating expenses, air freight charges, escrow fees, costs of surveys, premiums of hazard insurance policies and surety bonds and fees for any appraisal, appraisal review, market or feasibility study required by Lender. Borrower hereby authorizes Lender to disburse the proceeds of the Loan to pay such expenses, charges, costs and fees notwithstanding that Borrower may not have requested a disbursement of such amount. Such disbursement shall be added to the outstanding principal balance of the Note. The authorization hereby granted shall be irrevocable, and no further direction or authorization from Borrower shall be necessary for Lender to make such disbursements. However, the provision of this Section 12.10 shall not prevent Borrower from paying such expense, charges, costs and fees from its own funds. All such expenses, charges, costs and fees shall be Borrower’s obligation regardless of whether or not Borrower has requested and met the conditions for a disbursement of the Loan. The obligations on the part of Borrower under this Section 12.10 shall survive the closing of the Loan and the repayment thereof.

          12.11 Disclaimer by Lender. Lender shall not be liable to any contractor, subcontractor, supplier, laborer, architect, engineer or any other party for services performed or materials supplied in connection with the Project. Lender shall not be liable for any debts or claims accruing in favor of any such parties against Borrowers or others or against the Property or the Project. Borrower is not and shall not be an agent of Lender for any purpose. Lender is not a joint venture partner with Borrower in any manner whatsoever. Prior to default by Borrower under this Agreement and the exercise of remedies granted herein, Lender shall not be deemed to be in privity of contract with any contractor or provider of services to the Project, nor shall any payment of funds directly to a contractor, subcontractor, or provider of services be deemed to create any third party beneficiary status or recognition of same by Lender. Approvals granted by Lender for any matters covered under this Agreement shall be narrowly construed to cover only the parties and facts identified in any written approval or, if not in writing, such approvals shall be solely for the benefit of Borrower.

          12.12 Indemnification. TO THE FULLEST EXTENT PERMITTED BY LAW, BORROWER AGREES TO PROTECT, INDEMNIFY, DEFEND AND HOLD HARMLESS LENDER, ITS DIRECTORS, OFFICERS, AGENTS AND EMPLOYEES FROM AND AGAINST ANY AND ALL LIABILITY, EXPENSE OR DAMAGE OF ANY

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KIND OR NATURE AND FROM ANY SUITS, CLAIMS OR DEMANDS, INCLUDING REASONABLE LEGAL FEES AND EXPENSES ON ACCOUNT OF ANY MATTER OR THING OR ACTION OR FAILURE TO ACT BY LENDER, WHETHER IN SUIT OR NOT, ARISING OUT OF THIS AGREEMENT OR IN CONNECTION HEREWITH, OTHER THAN SUCH CLAIMS AND LIABILITIES AS ARISE SOLELY FROM THE GROSS NEGLIGENCE OR INTENTIONAL MISCONDUCT OF LENDER. Upon receiving knowledge of any suit, claim or demand asserted by a third party that Lender believes is covered by this indemnity, Lender shall give Borrower notice of the matter and an opportunity to defend it, at Borrower’s sole cost and expense, with legal counsel satisfactory to Lender. Lender may also require Borrower to defend the matter. The obligations on the part of Borrower under this Section 12.12 shall survive the closing of the Loan and the repayment thereof.

          12.13 Titles and Headings. The titles and headings of sections of this Agreement are intended for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.

          12.14 Brokers. Borrower and Lender represent to each other that neither of them knows of any brokerage commissions or finders’ fee due or claimed with respect to the transaction contemplated hereby. Borrower and Lender shall indemnify and hold harmless the other party from and against any and all loss, damage, liability, or expense, including costs and reasonable attorney fees, which such other party may incur or sustain by reason of or in connection with any misrepresentation by the indemnifying party with respect to the foregoing.

          12.15 Change, Discharge, Termination, or Waiver. No provision of this Agreement may be changed, discharged, terminated, or waived except in writing signed by the party against whom enforcement of the change, discharge, termination, or waiver is sought. No failure on the part of Lender to exercise and no delay by Lender in exercising any right or remedy under the Loan Documents or under the law shall operate as a waiver thereof.

          12.16 CHOICE OF LAW. THIS AGREEMENT AND THE TRANSACTION CONTEMPLATED HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES.

          12.17 Disbursements in Excess of Loan Amount. In the event the total disbursements by Lender exceed the amount of the Loan the total of all disbursements shall be secured by the Mortgage. All other sums expended by Lender pursuant to this Agreement or any other Loan Documents shall be deemed to have been paid to Borrower and shall be secured by, among other things, the Mortgage.

          12.18 Participations. Lender shall have the right at any time to sell, assign, transfer, negotiate or grant participations in all or any part of the Loan or the Note to one or more participants.

          12.19 Submission to Jurisdiction; Waiver of Venue; Service of Process.

          (a) BORROWER IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE

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JURISDICTION OF THE COURTS OF THE STATE OF TEXAS SITTING IN TARRANT COUNTY, THE COURTS OF THE STATE OF CALIFORNIA SITTING IN ORANGE COUNTY, THE UNITED STATES DISTRICT COURT OF THE NORTHERN DISTRICT OF TEXAS AND THE UNITED STATES DISTRICT COURT OF THE CENTRAL DISTRICT OF CALIFORNIA AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

          (b) BORROWER IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (a) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

          (c) EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 12.2. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

          12.20 Counterparts. This Agreement may be executed in any number of counterparts each of which shall be deemed an original, but all such counterparts together shall constitute but one agreement.

          12.21 Time is of the Essence. Time is of the essence of this Agreement.

          12.22 Attorneys’ Fees. Borrower shall promptly pay to Lender from Borrower’s own funds or from the proceeds of the Loan, upon demand, with interest thereon from the date of

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demand at the default interest rate, reasonable attorneys’ fees and all costs and other expenses paid or incurred by Lender in enforcing or exercising its rights or remedies created by, connected with or provided for in this Agreement, any of the other Loan Documents or under any Swap Contracts, and payment thereof shall be secured by the Mortgage. If at any time Borrower fails, refuses or neglects to do any of the things herein provided to be done by Borrower, Lender shall have the right, but not the obligation, to do the same but at the expense and for the account of Borrower. The amount of any monies so expended or obligations so incurred by Lender, together with interest thereon at the default interest rate, shall be repaid to Lender forthwith upon written demand therefor and payment thereof shall be secured by the Mortgage.

          12.23 Signs. Through the term of the Loan, Lender shall have the right to erect one of more signs on the Project indicating its provision of financing for the Project, and Lender shall also have the right to publicize its financing of the Project as Lender may deem appropriate.

          12.24 Waiver Of Jury Trial. BORROWER AND LENDER HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). BORROWER AND LENDER (A) CERTIFY THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGE THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

          12.25 WAIVER OF SPECIAL DAMAGES. BORROWER WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT BORROWER MAY HAVE TO CLAIM OR RECOVER FROM LENDER IN ANY LEGAL ACTION OR PROCEEDING ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES.

          12.26 USA Patriot Act Notification. The following notification is provided to Borrower pursuant to Section 326 of the USA Patriot Act of 2001, 31 U.S.C. Section 5318:

IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT. To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person or entity that opens an account, including any deposit account, treasury management account, loan, other extension of credit, or other financial services product. What this means for Borrower: When Borrower opens an account, if Borrower is an individual, Lender will ask for Borrower’s name, taxpayer identification number, residential

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address, date of birth, and other information that will allow Lender to identify Borrower, and, if Borrower is not an individual, Lender will ask for Borrower’s name, taxpayer identification number, business address, and other information that will allow Lender to identify Borrower. Lender may also ask, if Borrower is an individual, to see Borrower’s driver’s license or other identifying documents, and, if Borrower is not an individual, to see Borrower’s legal organizational documents or other identifying documents.

          12.27 Swap Contracts. Borrower may enter into Swap Contracts with Lender (or its Affiliates), or with another financial institution acceptable to Lender, for the purpose of hedging and protecting against interest rate fluctuation risks with respect to the Loan, on such terms and conditions as are mutually approved by Borrower and Lender (or its Affiliates). So long as any Mortgage encumbers the Project and the Swap Contract has been provided by Lender (or its Affiliates) in connection with the Loan, Borrower’s obligations (including any payment obligations) with respect to any such Swap Contract shall be secured by the Deeds of Trust and any other Collateral, and any default by Borrower under any such Swap Contract shall, at the discretion of Lender, constitute an Event of Default under this Agreement. All Swap Contracts, if any, between Borrower and Lender (or its Affiliates) are independent Agreements governed by the written provisions of the Swap Contracts, which will remain in full force and effect, unaffected by any repayment, prepayment, acceleration, reduction, increase or change in the terms of any Notes or other Loan Documents, except as otherwise expressly provided in the written Swap Contracts, and any payoff statement from Lender relating to the Note shall not apply to the Swap Contracts except as otherwise expressly provided in such payoff statement. By its respective signature below, each Borrower waives any right to prepay the Loan, in whole or in part, without payment of any and all amounts specified or required under the terms of any Swap Contracts (the “Indemnified Amounts”). Borrower acknowledges that prepayment of the Loan may result in Lender (or its Affiliates) incurring additional losses, costs, expenses and liabilities, including lost revenues and lost profits in connection with the Swap Contract or otherwise. Borrower therefore agrees to pay any and all Indemnified Amounts if the Loan is prepaid, whether voluntarily or by reason of acceleration, including acceleration upon any transfer or conveyance of any right, title or interest in any Property giving Lender the right to accelerate the maturity of the Loan as provided in the Loan Documents. Borrower agrees that Lender’s willingness to offer the Loan to Borrower is sufficient and independent consideration, given individual weight by Borrower, for this waiver. Borrower understands that Lender would not offer the Loan to Borrower absent this waiver. Notwithstanding anything to the contrary contained in this Agreement, any obligations of Borrower under any Swap Contracts owed to Wachovia Bank, N.A. (or any of its Affiliates) shall, at Wachovia Bank, N.A.’s (or its Affiliates’) discretion, be secured pari passu with any and all indebtedness and obligations of Borrower secured pursuant to the Loan Documents.

          12.28 Interest Rate Limitation. It is the intent of Borrower and Lender and all other parties to the Loan Documents to conform to and contract in strict compliance with applicable usury Law from time to time in effect. In no way, nor in any event or contingency (including but not limited to prepayment, default, demand for payment, or acceleration of the maturity of any obligation), shall the interest taken, reserved, contracted for, charged, chargeable, or received under this Agreement, or otherwise, exceed the maximum nonusurious amount

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permitted by applicable Law (the “Maximum Amount”). If, from any possible construction of any document, interest would otherwise be payable in excess of the Maximum Amount, any such construction shall be subject to the provisions of this Section and shall ipso facto be automatically reformed and the interest payable shall be automatically reduced to the Maximum Amount, without the necessity of execution of any amendment or new document. If Lender shall ever receive anything of value which is characterized as interest under applicable Law and which would apart from this provision be in excess of the Maximum Amount, an amount equal to the amount which would have been excessive interest shall, without penalty, be applied to the reduction of the principal amount owing under the Loan Documents in the inverse order of its maturity and not to the payment of interest, or refunded to Borrower or the other payor thereof if and to the extent such amount which would have been excessive exceeds such unpaid principal. The right to accelerate maturity of the Note or any other obligations under the Loan Documents does not include the right to accelerate any interest which has not otherwise accrued on the date of such acceleration, and does not intend to charge or receive any unearned interest in the event of acceleration. All interest paid or agreed to be paid to shall, to the extent permitted by applicable Law, be amortized, prorated, allocated and spread throughout the full stated term (including any renewal or extension) of such indebtedness so that the amount of interest on account of such indebtedness does not exceed the Maximum Amount. As used in this Section, the term “applicable Law” shall mean the Laws of the State where the Property is located or where the obligations under the Loan Documents are payable, or the federal Laws of the United States applicable to this transaction, whichever Laws allow the greatest interest, as such Laws now exist or may be changed or amended or come into effect in the future.

     12.29 Joint Borrower Provisions. Each Borrower acknowledges and agrees that it shall be jointly and severally liable for the Loan and all other Obligations arising under this Agreement and/or any of the other Loan Documents. In furtherance thereof, each Borrower acknowledges and agrees as follows:

          (a) For the purpose of implementing the joint borrower provisions of the Loan Documents, each Borrower hereby irrevocably appoints each other Borrower as its agent and attorney-in-fact for all purposes of the Loan Documents, including the giving and receiving of notices and other communications.

          (b) TO INDUCE THE LENDER TO MAKE THE LOAN, AND IN CONSIDERATION THEREOF, EACH BORROWER HEREBY AGREES TO INDEMNIFY THE LENDER AGAINST, AND HOLD THE LENDER HARMLESS FROM, ANY AND ALL LIABILITIES, EXPENSES, LOSSES, DAMAGES AND/OR CLAIMS OF DAMAGE OR INJURY ASSERTED AGAINST THE LENDER BY ANY BORROWER OR BY ANY OTHER PERSON ARISING FROM OR INCURRED BY REASON OF (i) RELIANCE BY THE LENDER ON ANY REQUESTS OR INSTRUCTIONS FROM ANY BORROWER, OR (ii) ANY OTHER ACTION TAKEN BY THE LENDER IN GOOD FAITH WITH RESPECT TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS.

          (c) Each Borrower acknowledges that the liens and security interests created or granted herein and by the other Loan Documents will secure Obligations of all Borrowers under the Loan Documents and, in full recognition of that fact, each Borrower

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consents and agrees that the Lender may, at any time and from time to time, without notice or demand, and without affecting the enforceability or security hereof or of any other Loan Document:

          (1) agree with any Borrowers to supplement, modify, amend, extend, renew, accelerate, or otherwise change the time for payment or the terms of the Obligations or any part thereof, including any increase or decrease of the rate(s) of interest thereon;

          (2) agree with any Borrowers to supplement, modify, amend or waive, or enter into or give any agreement, approval or consent with respect to, the Obligations or any part thereof or any of the Loan Documents or any additional security or guaranties, or any condition, covenant, default, remedy, right, representation or term thereof or thereunder;

          (3) accept new or additional instruments, documents or agreements in exchange for or relative to any of the Loan Documents or the Obligations or any part thereof;

          (4) accept partial payments on the Obligations;

          (5) receive and hold additional security or guaranties for the Obligations or any part thereof;

          (6) release, reconvey, terminate, waive, abandon, subordinate, exchange, substitute, transfer and enforce any security for or guaranties of the Obligations, and apply any security and direct the order or manner of sale thereof as Lender, in its sole and absolute discretion may determine;

          (7) release any Person or any guarantor from any personal liability with respect to the Obligations or any part thereof;

          (8) settle, release on terms satisfactory to the Lender or by operation of applicable laws or otherwise liquidate or enforce any Obligations and any security therefor or guaranty thereof in any manner, consent to the transfer of any such security and bid and purchase at any sale; and

          (9) consent to the merger, change or any other restructuring or termination of the corporate existence of any Borrower or any other Person, and correspondingly restructure the obligations of such Borrower or other Person, and any such merger, change, restructuring or termination shall not affect the liability of any Borrower or the continuing existence of any lien or security interest hereunder, under any other Loan Document to which any Borrower is a party or the enforceability hereof or thereof with respect to all or any part of the Obligations.

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Notwithstanding anything to the contrary contained in this Section 12.29, there shall be no written modification of the Loan Documents without execution by either Western Place or LP Borrower.

          (d) Upon the occurrence of and during the continuance of any Event of Default, the Lender may enforce this Agreement and the other Loan Documents independently as to each Borrower and independently of any other remedy or security the Lender at any time may have or hold in connection with the Obligations, and in collecting on the Loan it shall not be necessary for the Lender to marshal assets in favor of any Borrower or any other Person or to proceed upon or against and/or exhaust any other security or remedy before proceeding to enforce this Agreement and the other Loan Documents. Each Borrower expressly waives any right to require the Lender, in connection with the Lender’s efforts to obtain repayment of the Loan and other Obligations, to marshal assets in favor of any Borrower or any other Person or to proceed against any other Person or any collateral provided by any other Person, and agrees that the Lender may proceed against any Persons and/or collateral in such order as it shall determine in its sole and absolute discretion in connection with the Lender’s efforts to obtain repayment of the Loan and other Obligations. Lender may file a separate action or actions against each Borrower to enforce the Obligations, whether action is brought or prosecuted with respect to any other security or against any other Person, or whether any other Person is joined in any such action or actions. Each Borrower agrees that Lender, each Borrower and/or any other Person may deal with each other in connection with the Obligations or otherwise, or alter any contracts or agreements now or hereafter existing between any of them, in any manner whatsoever, all without in any way altering or affecting the security of this Agreement or the other Loan Documents. The rights of the Lender hereunder and under the other Loan Documents shall be reinstated and revived, and the enforceability of this Agreement and the other Loan Documents shall continue, with respect to any amount at any time paid on account of the Obligations which thereafter shall be required to be restored or returned by the Lender as a result of the bankruptcy, insolvency or reorganization of any Borrower or any other Person, or otherwise, all as though such amount had not been paid. The enforceability of this Agreement and the other Loan Documents at all times shall remain effective even though the any or all Obligations, or any other security or guaranty therefor, may be or hereafter may become invalid or otherwise unenforceable as against any Borrower or any other Person and whether or not any Borrower or any other Person shall have any personal liability with respect thereto. Each Borrower expressly waives any and all defenses to the enforcement of its obligations under the Loan Documents now or hereafter arising or asserted by reason of (i) any disability or other defense of any Borrower or any other Person with respect to the Obligations, (ii) the unenforceability or invalidity of any security or guaranty for the Obligations or the lack of perfection or continuing perfection or failure of priority of any security for the Obligations, (iii) the cessation for any cause whatsoever of the liability of any Borrower or any other Person (other than by reason of the full and final payment and performance of all Obligations), (iv) any failure of the Lender to marshal assets in favor of any of the Borrowers or any other Person, (v) any failure of the Lender to give notice of sale or other disposition of any Collateral for the Obligations to any Borrower or to any other Person or any defect in any notice that may be given in connection with any such sale or disposition, (vi) any failure of the Lender to

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comply in any non-material respect with applicable laws in connection with the sale or other disposition of any Collateral or other security for any Obligation, (vii) any act or omission of the Lender or others that directly or indirectly results in or aids the discharge or release of any Borrower or of any other Person or of any of the Obligations or any other security or guaranty therefor by operation of law or otherwise, (viii) any law which provides that the obligation of a surety or guarantor must neither be larger in amount nor in other respects more burdensome than that of the principal or which reduces a surety’s or guarantor’s obligation in proportion to the principal obligation, (ix) any failure of the Lender to file or enforce a claim in any bankruptcy or other proceeding with respect to any Person, (x) the election by the Lender, in any bankruptcy proceeding of any Person, of the application or non-application of Section 1111(b)(2) of the United States Bankruptcy Code, (xi) any extension of credit or the grant of any lien under Section 364 of the United States Bankruptcy Code except to extent otherwise provided in this Agreement, (xii) any use of cash collateral under Section 363 of the United States Bankruptcy Code, (xiii) any agreement or stipulation with respect to the provision of adequate protection in any bankruptcy proceeding of any Person, (xiv) the avoidance of any lien or security interest in favor of the Lender securing the Obligations for any reason, or (xv) any bankruptcy, insolvency, reorganization, arrangement, readjustment of debt, liquidation or dissolution proceeding commenced by or against any Person, including any discharge of, or bar or stay against collecting, all or any of the Obligations (or any interest thereon) in or as a result of any such proceeding. Without in any way limiting the foregoing, with respect to the Loan Documents and the Obligations, each Borrower: (A) waives all rights and defenses arising out of an election of remedies by the Lender, even though that election of remedies, such as nonjudicial foreclosure with respect to security for Borrowers’ obligations, has destroyed each of their rights of subrogation and reimbursement against the other by the operation of applicable law; and (B) waives any right to a fair value hearing or similar proceeding following a nonjudicial foreclosure of the Obligations to the maximum extent permitted by applicable law.

          (e) The Borrowers represent and warrant to the Lender that they have established adequate means of obtaining from each other, on a continuing basis, financial and other information pertaining to their respective businesses, operations and condition (financial and otherwise) and their respective properties, and each now is and hereafter will be completely familiar with the businesses, operations and condition (financial and otherwise) of the other and their respective properties. Each Borrower hereby expressly waives and relinquishes any duty on the part of Lender to disclose to such Borrower any matter, fact or thing related to the businesses, operations or condition (financial or otherwise) of the other Borrowers or the other Borrowers’ properties, whether now known or hereafter known by the Lender during the life of this Agreement. With respect to any of the Obligations, the Lender need not inquire into the powers of any Borrower or the officers, employees or other Persons acting or purporting to act on such Borrower’s behalf.

          (f) Without limiting the foregoing, or anything else contained in this Agreement, each Borrower waives all rights and defenses that it may have because the Obligations are secured by real property. This means, among other things:

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          (1) The Lender may collect on the Obligations from any Borrower without first foreclosing on any real or personal property collateral pledged by any other Borrower; and

          (2) If the Lender forecloses on any real property collateral pledged by any Borrower for the Obligations: (A) the amount of the indebtedness owed by the other Borrowers may be reduced only by the price for which that collateral is sold at the foreclosure sale, even if the collateral is worth more than the sale price; and (B) the Lender may collect from any Borrower even if the Lender, by foreclosing on the real property collateral, has destroyed any right any Borrower may have to collect from the other Borrowers.

          (g) This is an unconditional and irrevocable waiver of any rights and defenses each Borrower may have because the Obligations are secured by real property. Each Borrower expressly waives any right to receive notice of any judicial or nonjudicial foreclosure or sale of any real property collateral provided by the other Borrowers to secure the Obligations and failure to receive any such notice shall not impair or affect such Borrower’s obligations hereunder or the enforceability of this Agreement or the other Loan Documents or any liens created or granted hereby or thereby.

          (h) Notwithstanding anything to the contrary elsewhere contained herein or in any other Loan Document to which any Borrower is a party, with respect to the Loan and all other Obligations, each Borrower hereby waives (until such time as the Obligations have been fully satisfied) with respect to the other Borrowers and their successors and assigns (including any surety) and any other Person any and all rights at law or in equity, to subrogation, to reimbursement, to exoneration, to contribution, to setoff, to any other rights and defenses available to it under applicable law, or to any other rights that could accrue to a surety against a principal, to a guarantor against a maker or obligor, to an accommodation party against the party accommodated, or to a holder or transferee against a maker and which each of them may have or hereafter acquire against the other or any other Person in connection with or as a result of such Borrower’s execution, delivery and/or performance of this Agreement or any other Loan Document to which it is a party until the Obligations are paid and performed in full. Each Borrower agrees that it shall not have or assert any such rights against any other Borrower or any other Borrower’s successors and assigns or any other Person (including any surety), either directly or as an attempted setoff to any action commenced against such Borrower by any other Borrower (as borrower or in any other capacity) or any other Person until the all Obligations are paid and performed in full. Each Borrower hereby acknowledges and agrees that this waiver is intended to benefit the Lender and shall not limit or otherwise affect any Borrower’s liability under this Agreement or any other Loan Document to which it is a party, or the enforceability hereof or thereof.

          (i) Each Borrower warrants and agrees that each of the waivers and consents set forth herein is made with full knowledge of its significance and consequences, with the understanding that events giving rise to any defense waived may diminish, destroy or otherwise adversely affect rights which each otherwise may have against the other, against the Lender or others, or against any collateral. If any of the

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waivers or consents herein are determined to be contrary to any applicable law or public policy, such waivers and consents shall be effective to the maximum extent permitted by law.

ARTICLE XIII
EXHIBITS

          The following exhibits to this Agreement are fully incorporated herein as if set forth at length:

Exhibit A — Property Description

Exhibit B — Budget

Exhibit C — Closing Requirements

[Signatures Appear on Following Page.]

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          IN WITNESS WHEREOF, Lender and Borrower have caused this Agreement to be duly executed and delivered as of the date first above written.

“Lender” WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association
By:	/s/ Anne M. McNeil
	Name:	Anne M. McNeil
	Title:	Vice President
“Borrower” NNN WESTERN PLACE, LLC, a Delaware limited liability company
By:	NNN Western Place Manager, LLC, a
	Delaware limited liability company, its
	Manager
By:	Grubb & Ellis Realty Investors,
	LLC, a Virginia limited liability
	company, its Manager
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

Employer Identification No. 20-0905853

NNN WESTERN PLACE 1, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a
	Virginia limited liability company, its Vice
	President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
Employer Identification No. 63-1224037

NNN WESTERN PLACE 2, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a
	Virginia limited liability company, its Vice
	President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
Employer Identification No. 91-1743004

NNN WESTERN PLACE 3, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a
	Virginia limited liability company, its Vice
	President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
Employer Identification No. 36-6912283

NNN WESTERN PLACE 4, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a
	Virginia limited liability company, its Vice
	President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
Employer Identification No. ###-##-####

NNN WESTERN PLACE 5, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a
	Virginia limited liability company, its Vice
	President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
Employer Identification No. 550—36-7827

NNN WESTERN PLACE 6, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a
	Virginia limited liability company, its Vice
	President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
Employer Identification No. ###-##-####

NNN WESTERN PLACE 7, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a
	Virginia limited liability company, its Vice
	President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
Employer Identification No. 36-6912283

GREIT — WESTERN PLACE, LP, a Texas limited partnership
By:	GREIT — Western Place GP, LLC, a
	Delaware limited liability company, its
	General Partner
By:	G REIT Liquidating Trust dated
	January 22, 2008, a Maryland Trust,
	its Sole Member and Manager
By:	Gary H. Hunt, W. Brand
	Inlow, Edward A. Johnson,
	D. Fleet Wallace, and Gary T. Wescombe, as Trustees of the G REIT Liquidating Trust dated January 22, 2008
By:	/s/ Andrea R. Biller
	Name:	Andrea R. Biller
	Title:	Authorized Representative
Employer Identification No. 20-1334643

EX-10.22

EXHIBIT 10.22

PROMISSORY NOTE

$28,000,000.00 February 15, 2008

Borrower (defined below)
c/o Grubb & Ellis Realty Investors, LLC
1551 N. Tustin Avenue, Suite 300
Santa Ana, California 92705

WACHOVIA BANK, NATIONAL ASSOCIATION
Real Estate Financial Services
General Banking Group
Mail Code: CA 6233
15750 Alton Parkway
Irvine, California 92618

NNN WESTERN PLACE, LLC, a Delaware limited liability company, NNN WESTERN PLACE 1, LLC, a Delaware limited liability company, NNN WESTERN PLACE 2, LLC, a Delaware limited liability company, NNN WESTERN PLACE 3, LLC, a Delaware limited liability company, NNN WESTERN PLACE 4, LLC, a Delaware limited liability company, NNN WESTERN PLACE 5, LLC, a Delaware limited liability company, NNN WESTERN PLACE 6, LLC, a Delaware limited liability company, NNN WESTERN PLACE 7, LLC, a Delaware limited liability company, and GREIT — WESTERN PLACE, LP, a Texas limited partnership (individually and collectively, the “Borrower”), jointly and severally promise to pay to the order of WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association (“Lender”), in lawful money of the United States of America, at its office indicated above or wherever else Lender may specify, the sum of Twenty-Eight Million and No/100 Dollars ($28,000,000.00) or such sum as may be advanced and outstanding from time to time, with interest on the unpaid principal balance at the rate and on the terms provided in this Promissory Note (including all renewals, extensions or modifications hereof, this “Note”).

LOAN AGREEMENT. This Note is subject to the provisions of that certain Loan Agreement between Lender and Borrower of even date herewith (the “Loan Agreement”), as modified from time to time. Terms not otherwise defined herein shall be as defined in the Loan Agreement.

USE OF PROCEEDS. Borrower shall use the proceeds of the loan(s) evidenced by this Note for the commercial purposes of Borrower, as follows: financing and operation of the Project in accordance with the Loan Agreement, and other uses reasonably approved by Lender.

SECURITY. Borrower has granted Lender a security interest in the collateral described in the Loan Documents, including, but not limited to, real and personal property collateral described in that certain Mortgage, Assignment, Security Agreement and Fixture Filing of even date herewith.

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MATURITY OF THE LOAN: The outstanding principal balance of the Loan, together with all unpaid accrued interest thereon (not otherwise paid when due), and all other amounts payable by Borrower with respect to this Note or pursuant to the terms of any other Loan Documents (not otherwise paid when due), shall be due and payable in full on February 28, 2009 (the “Maturity Date”).

INTEREST RATE. Interest Period. Interest Rate Options. Interest shall accrue on the unpaid principal balance of the Loan from the date of the disbursement thereof at a rate per annum equal to the LIBOR Rate (as defined below) or the Prime Rate (as defined below), as selected by Borrower in accordance herewith (each, an “Interest Rate”). Interest shall be payable in arrears and shall be due on the first day of each calendar month and on the Maturity Date and on the date the outstanding principal amount of the Note is repaid in full. There shall be no more than one Interest Rate for the Loan in effect at any time. When the Prime Rate is selected for the Loan, it shall be adjusted from time to time, effective as of the date of each change in Lender’s Prime Rate and the Prime Rate shall continue to apply until another Interest Rate option is selected for the Loan pursuant to the subparagraph entitled “Notice and Manner of Borrowing and Rate Conversion”. When the LIBOR Rate is selected for the Loan, such rate shall apply for the Loan until another Interest Rate option is selected for the Loan pursuant to the subparagraph entitled “Notice and Manner of Borrowing and Rate Conversion.” Notice and Manner of Borrowing and Rate Conversion. Borrower shall give Lender irrevocable telephonic notice of each proposed rate conversion not later than 11:00 a.m. local time at the office of Lender first shown above (a) on the same business day as each rate conversion to the Prime Rate and (b) at least 2 business days before each proposed rate conversion to the LIBOR Rate. Each such notice shall specify (i) the date of such rate conversion, which shall be a business day and (ii) the Interest Rate selected by Borrower. Notices received after 11:00 a.m. local time at the office of Bank first shown above shall be deemed received on the next business day. Rate after Default. Upon the occurrence and during the continuance of an Event of Default, at the option of Lender, the outstanding principal balance of the Loan (and, to the extent permitted by applicable law, all accrued interest thereon) shall bear interest, payable on demand, for each day until paid at a rate per annum equal to the sum of 4% plus the greater of the LIBOR Rate or the Prime Rate (the “Default Rate”). The application of the Default Rate shall not be interpreted or deemed to extend any cure period set forth in the Loan Documents or otherwise to limit any of Lender’s remedies under this Note or any of the other Loan Documents. Computation of Interest. Interest on all Advances shall be computed on the basis of a 360-day year for the actual number of days in the applicable period (“Actual/360 Computation”). The Actual/360 Computation determines the annual effective interest yield by taking the stated (nominal) rate for a year’s period and then dividing said rate by 360 to determine the daily periodic rate to be applied for each day in the applicable period. Application of the Actual/360 Computation produces an annualized effective rate exceeding the nominal rate. If any payment of interest under the Note would otherwise be due on a day which is not a Business Day, the payment instead shall be due on the next succeeding Business Day and such extension of time shall be included in computing the interest due in respect of said payment. Each determination of an Interest Rate by Lender pursuant to any provision of this Note shall be conclusive and binding on Lender and Borrower in the absence of manifest error. No Deductions. All payments of principal or interest under this Note shall be made without deduction of any present and future taxes, levies, imposts, deductions, charges or withholdings, which amounts shall be owed and paid by Borrower. Borrower will pay the amounts necessary such that the gross

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amount of the principal and interest received by Lender is not less than that required by this Note. As used herein, “LIBOR Rate” means, for any day, the rate per annum determined on the basis of the offered rate for deposits in U.S. dollars having a maturity of one month which appears on the Reuters Screen LIBOR01 page as of 11:00 a.m. (London time) on such day, or if such day is not a London Banking Day, then on the immediately preceding London Banking Day, plus 1.65% per annum; provided that, if no such offered rates appear on such page, the applicable “LIBOR Rate” shall instead be the arithmetic average (rounded upward, if necessary, to the next higher 1/100th of 1%) of rates quoted by not less than two (2) major lenders in New York City, selected by Lender, at approximately 10:00 a.m., New York City time, on such day, for deposits in U.S. dollars offered by leading European banks having a maturity of one month in a amount comparable to the outstanding principal amount of the Loan, plus 1.65% per annum; provided, further, that if on any day Lender is unable to determine the LIBOR Rate in the foregoing manner, the LIBOR Rate for such day shall be the rate per annum equal to the Prime Rate for such day. The LIBOR Rate and the Prime Rate are floating rates which may change daily. As used herein, “Prime Rate” means that rate announced by Lender from time to time as its prime rate and is one of several interest rate bases used by Lender; Lender lends at rates both above and below the Prime Rate, and Borrower acknowledges that the Prime Rate is not represented or intended to be the lowest or most favorable rate of interest offered by Lender. As used herein, “London Banking Day” means a day on which dealings in dollar deposits are conducted by and between banks in the London interbank eurodollar market.

PREPAYMENT. Upon not less than thirty (30) days’ prior written notice to Lender, Borrower may prepay the Loan, in whole or in part (provided Lender shall have no obligations to readvance any repaid principal), without prepayment premium (but subject to any costs set forth in any Swap Contract should Lender in its sole discretion elect to terminate any such Swap Contract provided by Lender or its Affiliate upon any such prepayment).

APPLICATION OF PAYMENTS. Monies received by Lender from any source for application toward payment of the Obligations shall be applied in the following order: (i) late charges; (ii) impound payments for taxes and insurance required pursuant to the Loan Documents, if any, (iii) interest and (iv) principal. If an Event of Default occurs, monies may be applied to the Obligations in any manner or order deemed appropriate by Lender.

If any payment received by Lender under this Note or other Loan Documents is rescinded, avoided or for any reason returned by Lender because of any adverse claim or threatened action, the returned payment shall remain payable as an obligation of all persons liable under this Note or other Loan Documents as though such payment had not been made.

DEFINITIONS. Loan Documents. The term “Loan Documents”, shall have the meaning provided in the Loan Agreement. Obligations. The term “Obligations”, as used in this Note and the other Loan Documents, refers to any and all indebtedness and other obligations under this Note, all other obligations under any other Loan Document(s), and all obligations under any Swap Contracts entered into in connection with the Loan between Borrower and Lender (or its Affiliate) whenever executed. Certain Other Terms. All terms that are used but not otherwise defined in any of the Loan Documents shall have the definitions provided in the Uniform Commercial Code.

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LATE CHARGE. If any payments are not timely made, Borrower shall also pay to Lender a late charge equal to 4% of each payment past due for 15 or more days (other than the final repayment of the principal of the Loan at maturity).

Acceptance by Lender of any late payment without an accompanying late charge shall not be deemed a waiver of Lender’s right to collect such late charge or to collect a late charge for any subsequent late payment received.

ATTORNEYS’ FEES AND OTHER COLLECTION COSTS. Borrower shall pay all of Lender’s reasonable expenses incurred to enforce or collect any of the Obligations including, without limitation, arbitration, paralegals’, attorneys’ and experts’ fees and expenses, whether incurred without the commencement of a suit, in any trial, arbitration, or administrative proceeding, or in any appellate or Bankruptcy proceeding.

EVENT OF DEFAULT. The occurrence of any of the following will be deemed to be an event of default (“Event of Default”) hereunder: (i) Failure of Borrower to pay any amounts due pursuant to this Note or the Loan Documents (including, without limitation, principal, interest, fees, or other amounts) within ten (10) days after the date such amount is due; or (ii) the occurrence of any other Event of Default under the Loan Agreement, or any of the other Loan Documents (including any amendment, modification or extension thereof) which is not cured within any applicable cure period (if any) set forth therein.

REMEDIES UPON DEFAULT. Upon the occurrence and during the continuance of an Event of Default, at the option of Lender, the entire balance of principal of this Note, together with all accrued interest thereon, shall, without demand or notice, immediately become due and payable and so long as such Event of Default continues, the entire balance of principal together with all accrued interest shall bear interest at the Default Rate. Upon the occurrence and during the continuance of an Event of Default, Lender may exercise any and all rights and remedies it may have under the Loan Documents, and under applicable law and in equity. No delay or omission on the part of the holder hereof in exercising any right under this Note or under any of the other Loan Documents will operate as a waiver of such right.

FINANCIAL AND OTHER INFORMATION. Borrower shall timely deliver to Lender the information required under Section 10.8 of the Loan Agreement. Such information shall be true, complete, and accurate in all material respects.

WAIVERS AND AMENDMENTS. No waivers, amendments or modifications of this Note and other Loan Documents shall be valid unless in writing and signed by an officer of Lender. No waiver by Lender of any Event of Default shall operate as a waiver of any other Event of Default or the same Event of Default on a future occasion. Neither the failure nor any delay on the part of Lender in exercising any right, power, or remedy under this Note and other Loan Documents shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or remedy.

Each Borrower or any person liable under this Note waives presentment, protest, notice of dishonor, demand for payment, notice of intention to accelerate maturity, notice of acceleration of maturity, notice of sale and all other notices of any kind. Further, each agrees that Lender

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may extend, modify or renew this Note or make a novation of the loan evidenced by this Note for any period, and grant any releases, compromises or indulgences with respect to any collateral securing this Note, or with respect to any other Borrower or any other person liable under this Note or other Loan Documents, all without notice to or consent of each Borrower or each person who may be liable under this Note or any other Loan Document and without affecting the liability of Borrower or any person who may be liable under this Note or any other Loan Document.

MISCELLANEOUS PROVISIONS. Assignment. This Note and the other Loan Documents shall inure to the benefit of and be binding upon the parties and their respective heirs, legal representatives, successors and assigns. Lender’s interests in and rights under this Note and the other Loan Documents are freely assignable, in whole or in part, by Lender. In addition, nothing in this Note or any of the other Loan Documents shall prohibit Lender from pledging or assigning this Note or any of the other Loan Documents or any interest therein to any Federal Reserve Lender. Borrower shall not assign its rights and interest hereunder without the prior written consent of Lender, and any attempt by Borrower to assign without Lender’s prior written consent is null and void. Any assignment shall not release Borrower from the Obligations. Applicable Law; Conflict Between Documents. This Note and, unless otherwise provided in any other Loan Document, the other Loan Documents shall be governed by and construed under the laws of the State of Texas without regard to that state’s conflict of laws principles. Notwithstanding Section 12.4 of the Loan Agreement, if the terms of this Note should conflict with the terms of any loan agreement or any commitment letter that survives closing, the terms of this Note shall control. Jurisdiction. Borrower irrevocably agrees to non-exclusive personal jurisdiction in the State of Texas and the state named in Lender’s address on the first page hereof. Severability. If any provision of this Note or of the other Loan Documents shall be prohibited or invalid under applicable law, such provision shall be ineffective but only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Note or other such document. Notices. Any notices to be given under this Note shall be given in accordance with the terms of Section 12.2 of the Loan Agreement. Plural; Captions. All references in the Loan Documents to Borrower, guarantor, person, document or other nouns of reference mean both the singular and plural form, as the case may be, and the term “person” shall mean any individual, person or entity. The captions contained in the Loan Documents are inserted for convenience only and shall not affect the meaning or interpretation of the Loan Documents. Advances. Lender may, in its sole discretion, make other advances to or on behalf of Borrower which shall be deemed to be advances under this Note, even though the stated principal amount of this Note may be exceeded as a result thereof. Posting of Payments. All payments received at the office of Lender first shown above after 1:00 p.m. local time in Charlotte, North Carolina shall be deemed received at the opening of the next banking day. Fees and Taxes. Borrower shall promptly pay all documentary, intangible recordation and/or similar taxes on this transaction (excluding all excess profits taxes, franchise taxes, capital stock taxes, federal and state income taxes, and other taxes to the extent applicable to Lender’s general or net income) whether assessed at closing or arising from time to time.

WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS NOTE OR ANY OTHER LOAN

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DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS NOTE AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

INTEREST RATE LIMITATION. It is the intent of Borrower and Lender and all other parties to the Loan Documents to conform to and contract in strict compliance with applicable usury Law from time to time in effect. In no way, nor in any event or contingency (including but not limited to prepayment, default, demand for payment, or acceleration of the maturity of any obligation), shall the interest taken, reserved, contracted for, charged, chargeable, or received under this Agreement, or otherwise, exceed the maximum nonusurious amount permitted by applicable Law (the “Maximum Amount”). If, from any possible construction of any document, interest would otherwise be payable in excess of the Maximum Amount, any such construction shall be subject to the provisions of this Section and shall ipso facto be automatically reformed and the interest payable shall be automatically reduced to the Maximum Amount, without the necessity of execution of any amendment or new document. If Lender shall ever receive anything of value which is characterized as interest under applicable Law and which would apart from this provision be in excess of the Maximum Amount, an amount equal to the amount which would have been excessive interest shall, without penalty, be applied to the reduction of the principal amount owing under the Loan Documents in the inverse order of its maturity and not to the payment of interest, or refunded to Borrower or the other payor thereof if and to the extent such amount which would have been excessive exceeds such unpaid principal. The right to accelerate maturity of the Note or any other obligations under the Loan Documents does not include the right to accelerate any interest which has not otherwise accrued on the date of such acceleration, and does not intend to charge or receive any unearned interest in the event of acceleration. All interest paid or agreed to be paid to shall, to the extent permitted by applicable Law, be amortized, prorated, allocated and spread throughout the full stated term (including any renewal or extension) of such indebtedness so that the amount of interest on account of such indebtedness does not exceed the Maximum Amount. As used in this Section, the term “applicable Law” shall mean the Laws of the State where the Property is located or where the obligations under the Loan Documents are payable, or the federal Laws of the United States applicable to this transaction, whichever Laws allow the greatest interest, as such Laws now exist or may be changed or amended or come into effect in the future.

JOINT BORROWER PROVISIONS. If more than one Person signs this Note as Borrower, (a) the term “Borrower” shall mean each such Person and (b) the obligations of each Borrower shall be joint, several and independent. Section 12.29 of the Loan Agreement (the “Joint Borrower” provisions) is by this reference incorporated herein in its entirety. This Note may be executed in multiple counterparts, each of which shall constitute an original, but all of which shall constitute one document.

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IN WITNESS WHEREOF, Borrower, on the day and year first above written, has caused this Note to be executed under seal.

PLACE OF EXECUTION AND DELIVERY. Borrower hereby certifies that this Note and the Loan Documents were executed in the State of California and delivered to Lender in the State of Texas.

BORROWER: NNN WESTERN PLACE, LLC, a Delaware limited liability company By:  NNN Western Place Manager, LLC, a         Delaware limited liability company, its         Manager
By:  Grubb & Ellis Realty Investors, LLC, a         Virginia limited liability company, its Manager
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Office
NNN WESTERN PLACE 1, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 2, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

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NNN WESTERN PLACE 3, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 4, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 5, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 6, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

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NNN WESTERN PLACE 7, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
GREIT — WESTERN PLACE, LP, a Texas limited partnership By:  GREIT — Western Place GP, LLC, a Delaware         limited liability company, its General Partner
By:  G REIT Liquidating Trust dated         January 22, 2008, a Maryland Trust,         its Sole Member and Manager
By:  Gary H. Hunt, W. Brand Inlow,         Edward A. Johnson, D. Fleet         Wallace, and Gary T. Wescombe, as         Trustees of the G REIT Liquidating         Trust dated January 22, 2008
By:	/s/ Andrea R. Biller
	Name:	Andrea R. Biller
	Title:	Authorized Representative

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EX-10.23

EXHIBIT 10.23

Prepared By/Return To:
Sheppard, Mullin, Richter & Hampton llp
650 Town Center Drive, 4th Floor
Costa Mesa, California 92626-1993
Attn: Kenneth D. Fox, Esquire

SPACE ABOVE THIS LINE RESERVED FOR RECORDER’S USE

DEED OF TRUST, ASSIGNMENT
SECURITY AGREEMENT AND
FIXTURE FILING

by

NNN WESTERN PLACE, LLC, a Delaware limited liability company
(Organizational Identification Number 3776466),
NNN WESTERN PLACE 1, LLC, a Delaware limited liability company
(Organizational Identification Number 3824095),
NNN WESTERN PLACE 2, LLC, a Delaware limited liability company
(Organizational Identification Number 3824096),
NNN WESTERN PLACE 3, LLC, a Delaware limited liability company
(Organizational Identification Number 3824099),
NNN WESTERN PLACE 4, LLC, a Delaware limited liability company
(Organizational Identification Number 3824100),
NNN WESTERN PLACE 5, LLC, a Delaware limited liability company
(Organizational Identification Number 3824101),
NNN WESTERN PLACE 6, LLC, a Delaware limited liability company
(Organizational Identification Number 3824102),
NNN WESTERN PLACE 7, LLC, a Delaware limited liability company
(Organizational Identification Number 3824103), and
GREIT — WESTERN PLACE, LP, a Texas limited partnership
(Organizational Identification Number 800353572),
as Grantor,
to
TRSTE, INC., a Virginia corporation
as Trustee
in favor of
WACHOVIA BANK, NATIONAL ASSOCIATION,
a national banking association,
as Beneficiary

This document serves as a Fixture Filing under the Texas Uniform Commercial Code.

Deed of Trust, Assignment, Security Agreement and Fixture Filing

NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OF THE
FOLLOWING INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE IT IS
FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER’S LICENSE
NUMBER.

THIS INSTRUMENT CONTAINS INDEMNIFICATION PROVISIONS AND PROVISIONS LIMITING BENEFICIARY’S LIABILITY
FOR NEGLIGENCE.

     This Deed of Trust, Assignment, Security Agreement and Fixture Filing is made as of the 15th day of February, 2008, by NNN WESTERN PLACE, LLC, a Delaware limited liability company, NNN WESTERN PLACE 1, LLC, a Delaware limited liability company, NNN WESTERN PLACE 2, LLC, a Delaware limited liability company, NNN WESTERN PLACE 3, LLC, a Delaware limited liability company, NNN WESTERN PLACE 4, LLC, a Delaware limited liability company, NNN WESTERN PLACE 5, LLC, a Delaware limited liability company, NNN WESTERN PLACE 6, LLC, a Delaware limited liability company, NNN WESTERN PLACE 7, LLC, a Delaware limited liability company, and GREIT — WESTERN PLACE, LP, a Texas limited partnership (individually and collectively herein referred to as “Grantor”), whose address is c/o Grubb & Ellis Realty Investors, LLC, 1551 N. Tustin Avenue, Suite 300, Santa Ana, California 92705, to the TRSTE, INC., a Virginia corporation (“Initial Trustee”), whose address is 301 South Tryon Street, Charlotte, North Carolina 28288, for the benefit of WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association (“Beneficiary”), whose address is Wachovia Bank, N.A., Real Estate Financial Services, General Banking Group, Mail Code: CA 6233, 15750 Alton Parkway, Irvine, California 92618.

Recitals

     Grantor has requested that Beneficiary make the Loan (as hereinafter defined) to Grantor. As a condition precedent to making the Loan, Beneficiary has required that Grantor execute and deliver this Deed of Trust, Assignment, Security Agreement and Fixture Filing to Trustee for the benefit of Beneficiary.

Grants and Agreements

     Now, therefore, in order to induce Beneficiary to make the Loan to Grantor, Grantor agrees as follows:

Article I
Definitions

     As used in this Deed of Trust, the terms defined in the Preamble hereto shall have the respective meanings specified therein, and the following additional terms shall have the meanings specified:

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     “Accessories” means all fixtures, equipment, systems, machinery, furniture, furnishings, appliances, inventory, goods, building and construction materials, supplies and other articles of personal property, of every kind and character, tangible and intangible (including software embedded therein), now owned or hereafter acquired by Grantor, which are now or hereafter attached to or situated in, on or about the Land or Improvements, or used in or necessary to the complete and proper planning, development, use, occupancy or operation thereof, or acquired (whether delivered to the Land or stored elsewhere) for use or installation in or on the Land or Improvements, and all Additions to the foregoing, all of which are hereby declared to be permanent accessions to the Land.

     “Accelerating Transfer” means any Transfer of all or any part of the Property, the legal or beneficial interest therein, or any membership interest in Grantor in violation of Section 5.2 of this Deed of Trust.

     “Accounts” means all accounts of Grantor, within the meaning of the Uniform Commercial Code of the State, derived from or arising out of the use, occupancy or enjoyment of the Property or for services rendered therein or thereon.

     “Additions” means any and all alterations, additions, accessions and improvements to property, substitutions therefor, and renewals and replacements thereof.

     “Beneficiary” means Beneficiary and its successors and assigns.

     “Claim” means any liability, suit, action, claim, demand, loss, expense, penalty, fine, judgment or other cost of any kind or nature whatsoever, including fees, costs and expenses of attorneys, consultants, contractors and experts.

     “Condemnation” means any taking of title to, use of, or any other interest in the Property under the exercise of the power of condemnation or eminent domain, whether temporarily or permanently, by any Governmental Authority or by any other Person acting under or for the benefit of a Governmental Authority.

     “Condemnation Awards” means any and all judgments, awards of damages (including severance and consequential damages), payments, proceeds, settlements, amounts paid for a taking in lieu of Condemnation, or other compensation heretofore or hereafter made, including interest thereon, and the right to receive the same, as a result of, or in connection with, any Condemnation or threatened Condemnation.

     “Deed of Trust” means this Deed of Trust, Assignment, Security Agreement and Fixture Filing, as the same may from time to time be extended, amended, restated, supplemented or otherwise modified.

     “Default” means an event or circumstance which, with the giving of Notice or lapse of time, or both, would constitute an Event of Default under the provisions of this Deed of Trust.

     “Design and Development Documents” means, collectively, (a) all contracts for services to be rendered, work to be performed or materials to be supplied in the development of the Land or the construction or repair of Improvements, if any; (b) all plans, drawings and specifications

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for the development of the Land or the construction or repair of Improvements, if any; (c) all permits, licenses, variances and other rights or approvals issued by or obtained from any Governmental Authority or other Person in connection with the development of the Land or the construction or repair of Improvements, if any; and (d) all amendments of or supplements to any of the foregoing.

     “Encumbrance” means any Lien, easement, right of way, roadway (public or private), condition, covenant or restriction (including any condition, covenant or restriction imposed in connection with any condominium development or cooperative housing development), Lease or other matter of any nature that would affect title to the Property.

     “Environmental Agreement” means the Environmental Indemnity Agreement of even date herewith by and between Grantor and Guarantor in favor of Beneficiary pertaining to the Property, as the same may from time to time be extended, amended, restated, supplemented or otherwise modified. The Environmental Agreement is one of the Loan Documents, but this Deed of Trust does not secure the obligations of Grantor or Guarantor under the Environmental Agreement.

     “Event of Default” means an event or circumstance specified in Article VI and the continuance of such event or circumstance beyond the applicable grace and/or cure periods therefor, if any, set forth in Article VI.

     “Expenses” means all fees, charges, costs and expenses of any nature whatsoever incurred at any time and from time to time (whether before or after an Event of Default) by Beneficiary or Trustee in making, funding, administering or modifying the Loan, in negotiating or entering into any “workout” of the Loan, or in exercising or enforcing any rights, powers and remedies provided in this Deed of Trust or any of the other Loan Documents, including attorneys’ fees, court costs, receiver’s fees, management fees and costs incurred in the repair, maintenance and operation of, or taking possession of, or selling, the Property.

     “Governmental Authority” means any governmental or quasi-governmental entity, including any court, department, commission, board, bureau, agency, administration, service, district or other instrumentality of any governmental entity.

     “Guarantor” means, individually and collectively, Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace, and Gary T. Wescombe, as Trustees of the G REIT Liquidating Trust dated January 22, 2008, and NNN Realty Advisors, Inc., a Delaware corporation.

     “Improvements” means all buildings, structures and other improvements now or hereafter existing, erected or placed on the Land, together with any off-site improvements owned by Grantor in any way used or to be used in connection with the use, enjoyment, occupancy or operation of the Land.

     “Insurance Proceeds” means the insurance claims under and the proceeds of any and all policies of insurance covering the Property or any part thereof, including all returned and unearned premiums with respect to any insurance relating to such Property, in each case whether now or hereafter existing or arising.

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     “Land” means the real property described in Exhibit A attached hereto and made a part hereof.

     “Laws” means all federal, state and local laws, statutes, rules, ordinances, regulations, codes, licenses, authorizations, decisions, injunctions, interpretations, orders or decrees of any court or other Governmental Authority having jurisdiction as may be in effect from time to time.

     “Leases” means all leases, license agreements and other occupancy or use agreements (whether oral or written), now or hereafter existing, which cover or relate to the Property or any part thereof, together with all options therefor, amendments thereto and renewals, modifications and guaranties thereof, including any cash or security deposited under the Leases to secure performance by the tenants of their obligations under the Leases, whether such cash or security is to be held until the expiration of the terms of the Leases or applied to one or more of the installments of rent coming due thereunder.

     “Letter of Credit” means any letter of credit issued by Beneficiary for the account of Grantor or its nominee in connection with the Property, together with any and all extensions, renewals or modifications thereof, substitutions therefor or replacements thereof.

     “Lien” means any mortgage, deed of trust, pledge, security interest, assignment, judgment, lien or charge of any kind, including any conditional sale or other title retention agreement, any lease in the nature thereof, and the filing of, or agreement to give, any financing statement under the Uniform Commercial Code of any jurisdiction.

     “Loan” means the loan from Beneficiary to Grantor, the repayment obligations in connection with which are evidenced by the Note.

     “Loan Agreement” means the Loan Agreement of even date herewith between Grantor and Beneficiary which sets forth, among other things, the terms and conditions upon which the proceeds of the Loan will be disbursed, as the same may from time to time be extended, amended, restated, supplemented or otherwise modified.

     “Loan Documents” means this Deed of Trust, the Note, the Repayment Guaranty, the Environmental Agreement, the Loan Agreement, any application or reimbursement agreement executed in connection with any Letter of Credit, and any and all other documents (other than any Swap Contracts) which Grantor, Guarantor or any other party or parties have executed and delivered, or may hereafter execute and deliver, to evidence, secure or guarantee the Obligations, or any part thereof, as the same may from time to time be extended, amended, restated, supplemented or otherwise modified.

     “Note” means the Promissory Note of even date herewith in the original principal amount of Twenty-Eight Million Thousand and No/100 Dollars ($28,000,000.00) made by Grantor to the order of Beneficiary, as the same may from time to time be extended, amended, restated, supplemented or otherwise modified.

     “Notice” means a notice, request, consent, demand or other communication given in accordance with the provisions of Section 9.8 of this Deed of Trust.

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     “Obligations” means all present and future debts, obligations and liabilities of Grantor to Beneficiary and/or Trustee arising pursuant to, and/or on account of, the provisions of this Deed of Trust, the Note or any of the other Loan Documents, including the obligations: (a) to pay all principal, interest, late charges, prepayment premiums (if any) and other amounts due at any time under the Note; (b) to pay all Expenses, indemnification payments, fees and other amounts due at any time under this Deed of Trust or any of the other Loan Documents, together with interest thereon as herein or therein provided; (c) to pay and perform all obligations of Grantor under any Swap Contract; (d) to perform, observe and comply with all of the other terms, covenants and conditions, expressed or implied, which Grantor is required to perform, observe or comply with pursuant to this Deed of Trust or any of the other Loan Documents; and (e) to pay and perform all future advances and other obligations that Grantor or any successor in ownership of all or part of the Property may agree to pay and/or perform (whether as principal, surety or guarantor) for the benefit of Beneficiary, when a writing evidences the parties’ agreement that the advance or obligation be secured by this Deed of Trust; excluding, however, the debts, obligations and liabilities of Grantor under the Environmental Agreement. This Deed of Trust does not secure the Environmental Agreement, the Repayment Guaranty or any other Loan Document that is expressly stated to be unsecured.

     “Permitted Encumbrances” means (a) any matters set forth in any policy of title insurance issued to Beneficiary and insuring Beneficiary’s interest in the Property which are acceptable to Beneficiary as of the date hereof, (b) the Liens and interests of this Deed of Trust, and (c) any other Encumbrance that Beneficiary shall expressly approve in writing in its sole and absolute discretion.

     “Person” means an individual, a corporation, a partnership, a joint venture, a limited liability company, a trust, an unincorporated association, any Governmental Authority or any other entity.

     “Personalty” means all personal property of any kind or nature whatsoever, whether tangible or intangible and whether now owned or hereafter acquired, in which Grantor now has or hereafter acquires an interest and which is used in the construction of, or is placed upon, or is derived from or used in connection with the maintenance, use, occupancy or enjoyment of, the Property, including (a) the Accessories; (b) the Accounts; (c) all franchise, license, management or other agreements with respect to the operation of the Real Property or the business conducted therein (provided all of such agreements shall be subordinate to this Deed of Trust, and Beneficiary shall have no responsibility for the performance of Grantor’s obligations thereunder) and all general intangibles (including payment intangibles, trademarks, trade names, goodwill, software and symbols but excluding all of Grantor’s rights to the payment of money to Grantor under any Swap Contracts) related to the Real Property or the operation thereof; (d) all sewer and water taps, appurtenant water stock or water rights, allocations and agreements for utilities, bonds, letters of credit, permits, certificates, licenses, guaranties, warranties, causes of action, judgments, Claims, profits, security deposits, utility deposits, and all rebates or refunds of fees, Taxes, assessments, charges or deposits paid to any Governmental Authority related to the Real Property or the operation thereof; (e) all insurance policies held by Grantor with respect to the Property or Grantor’s operation thereof; and (f) all money, instruments and documents (whether tangible or electronic) arising from or by virtue of any transactions related to the Property, and all deposits and deposit accounts of Grantor with Beneficiary related to the Property, including

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any such deposit account from which Grantor may from time to time authorize Beneficiary to debit and/or credit payments due with respect to the Loan; together with all Additions to and Proceeds of all of the foregoing. For purposes of clarification, “Personalty”, and the security interests granted hereunder, do not include any of Grantor’s rights to the payment of money from Beneficiary (or its Affiliates) under any Swap Contracts.

     “Proceeds,” when used with respect to any of the Property, means all proceeds of such Property, including all Insurance Proceeds and all other proceeds within the meaning of that term as defined in the Uniform Commercial Code of the State.

     “Property” means the Real Property and the Personalty and all other rights, interests and benefits of every kind and character which Grantor now has or hereafter acquires in, to or for the benefit of the Real Property and/or the Personalty and all other property and rights used or useful in connection therewith, including all Leases, all Rents, all Condemnation Awards, all Proceeds, and all of Grantor’s right, title and interest in and to all Design and Development Documents, all Contracts of Sale and all Refinancing Commitments.

     “Property Assessments” means all Taxes, payments in lieu of taxes, water rents, sewer rents, assessments, condominium and owner’s association assessments and charges, maintenance charges and other governmental or municipal or public or private dues, charges and levies and any Liens (including federal tax liens) which are or may be levied, imposed or assessed upon the Property or any part thereof, or upon any Leases or any Rents, whether levied directly or indirectly or as excise taxes, as income taxes, or otherwise.

     “Real Property” means the Land and Improvements, together with (a) all estates, title interests, title reversion rights, remainders, increases, issues, profits, rights-of-way or uses, additions, accretions, servitudes, strips, gaps, gores, liberties, privileges, water rights, water courses, alleys, passages, ways, vaults, licenses, tenements, franchises, hereditaments, appurtenances, easements, rights of ingress or egress, parking rights, timber, crops, mineral interests and other rights, now or hereafter owned by Grantor and belonging or appertaining to the Land or Improvements; (b) all Claims whatsoever of Grantor with respect to the Land or Improvements, either in law or in equity, in possession or in expectancy; (c) all estate, right, title and interest of Grantor in and to all streets, roads and public places, opened or proposed, now or hereafter adjoining or appertaining to the Land or Improvements; and (d) all options to purchase the Land or Improvements, or any portion thereof or interest therein, and any greater estate in the Land or Improvements, and all Additions to and Proceeds of the foregoing.

     “Refinancing Commitment” means any commitment from or other agreement with any Person providing for the financing of the Property, some or all of the proceeds of which are intended to be used for the repayment of all or a portion of the Loan.

     “Rents” means all of the rents, royalties, issues, profits, revenues, earnings, income and other benefits of the Property, or arising from the use or enjoyment of the Property, including all such amounts paid under or arising from any of the Leases and all fees, charges, accounts or other payments for the use or occupancy of rooms or other public facilities within the Real Property.

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     “Repayment Guaranty” means, collectively, the Repayment Guaranty of even date herewith executed by NNN Realty Advisors, Inc., a Delaware corporation, for the benefit of Lender, as the same may from time to time be extended, amended, restated, supplemented or otherwise modified, and the Repayment Guaranty of even date herewith executed by the Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace, and Gary T. Wescombe, as Trustees of the G REIT Liquidating Trust dated January 22, 2008, for the benefit of Lender, as the same may from time to time be extended, amended, restated, supplemented or otherwise modified.

     “State” means the state in which the Land is located.

     “Swap Contract” means any agreement, whether or not in writing, relating to any transaction that is a rate swap, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap or option, bond, note or bill option, interest rate option, forward foreign exchange transaction, interest cap, collar or floor transaction, currency swap, cross-currency rate swap, swap option, currency option or any other similar transaction (including any option to enter into the foregoing) or any combination of the foregoing, and, unless the context otherwise clearly requires, any form of master agreement published by the International Swaps and Derivatives Association, Inc., or any other master agreement, entered into between Beneficiary (or its affiliate) and Grantor (or its affiliate) in connection with the Loan, together with any related schedules and confirmations, as amended, supplemented, superseded or replaced from time to time, relating to or governing any or all of the foregoing.

     “Taxes” means all taxes and assessments, whether general or special, ordinary or extraordinary, or foreseen or unforeseen, which at any time may be assessed, levied, confirmed or imposed by any Governmental Authority or any community facilities or other private district on Grantor or on any of its properties or assets or any part thereof or in respect of any of its franchises, businesses, income or profits.

     “Transfer” means any direct or indirect sale, assignment, conveyance or transfer, whether made voluntarily or by operation of Law or otherwise, and whether made with or without consideration.

     “Trustee” means the Initial Trustee or its successor in trust who may be acting under and pursuant to this Deed of Trust from time to time.

Article II
Granting Clauses; Condition of Grant

     Section 2.1 Conveyances and Security Interests.

     In order to secure the prompt payment and performance of the Obligations, Grantor, as tenants in common, (a) irrevocably and unconditionally grants, conveys, transfers and assigns to Trustee, in trust, for the benefit of Beneficiary, with power of sale and right of entry and possession, all estate, right, title and interest that Grantor now has or may later acquire in and to the Real Property; (b) grants to Beneficiary a security interest in the Personalty; (c) assigns to Beneficiary, and grants to Beneficiary a security interest in, all Condemnation Awards and all Insurance Proceeds; and (d) assigns to Beneficiary, and grants to Beneficiary a security interest

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in, all of Grantor’s right, title and interest in, but not any of Grantor’s obligations or liabilities under, all Design and Development Documents, all Contracts of Sale and all Refinancing Commitments. All Persons who may have or acquire an interest in all or any part of the Property will be deemed to have notice of, and will be bound by, the terms of the Obligations and each other agreement or instrument made or entered into in connection with each of the Obligations. Such terms include any provisions in the Note, the Loan Agreement or any Swap Contract which provide that the interest rate on one or more of the Obligations may vary from time to time. Unless Lender otherwise agrees in writing, Grantor’s obligations under any Swap Contract shall continue to be secured by this Deed of Trust notwithstanding that Lender has sold, participated, syndicated or otherwise transferred or released some or all of its interest in the Loan to another person.

     Section 2.2 Absolute Assignment of Leases and Rents.

     In consideration of the making of the Loan by Beneficiary to Grantor and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Grantor absolutely and unconditionally assigns the Leases and Rents to Beneficiary. This assignment is, and is intended to be, an unconditional, absolute and present assignment from Grantor to Beneficiary of all of Grantor’s right, title and interest in and to the Leases and the Rents and not an assignment in the nature of a pledge of the Leases and Rents or the mere grant of a security interest therein. So long as no Event of Default shall exist, however, and so long as Grantor is not in default in the performance of any obligation, covenant or agreement contained in the Leases, Grantor shall have a license (which license shall terminate automatically and without notice upon the occurrence of an Event of Default or a default by Grantor under the Leases) to collect, but not prior to accrual, all Rents. Grantor agrees to collect and hold all Rents in trust for Beneficiary and to use the Rents for the payment of the cost of operating and maintaining the Property and for the payment of the other Obligations before using the Rents for any other purpose.

     Section 2.3 Security Agreement, Fixture Filing and Financing Statement.

     This Deed of Trust creates a security interest in the Personalty, and, to the extent the Personalty is not real property, this Deed of Trust constitutes a security agreement from Grantor to Beneficiary under the Uniform Commercial Code of the State. In addition to all of its other rights under this Deed of Trust and otherwise, Beneficiary shall have all of the rights of a secured party under the Uniform Commercial Code of the State, as in effect from time to time, or under the Uniform Commercial Code in force from time to time in any other state to the extent the same is applicable Law. This Deed of Trust shall be effective as a financing statement filed as a fixture filing with respect to all fixtures included within the Property and is to be filed for record in the real estate records of each county where any part of the Property (including such fixtures) is situated. This Deed of Trust shall also be effective as a financing statement with respect to any other Property as to which a security interest may be perfected by the filing of a financing statement and may be filed as such in any appropriate filing or recording office. The respective mailing addresses of Grantor and Beneficiary are set forth in the opening paragraph of this Deed of Trust. A carbon, photographic or other reproduction of this Deed of Trust or any other financing statement relating to this Deed of Trust shall be sufficient as a financing statement for any of the purposes referred to in this Section. Grantor hereby irrevocably authorizes

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Beneficiary at any time and from time to time to file any initial financing statements, amendments thereto and continuation statements as authorized by applicable Law, reasonably required by Beneficiary to establish or maintain the validity, perfection and priority of the security interests granted in this Deed of Trust. The foregoing authorization includes Grantor’s irrevocable authorization for Beneficiary at any time and from time to time to file any initial financing statements and amendments thereto that indicate the Personalty (a) as “all assets” of Grantor or words of similar effect, regardless of whether any particular asset comprised in the Personalty falls within the scope of the Uniform Commercial Code of the State or the jurisdiction where the initial financing statement or amendment is filed, or (b) as being of an equal or lesser scope or with greater detail; provided that in either case, such description is limited to assets used on or in connection with the Property.

     Section 2.4 Reconveyance of Deed of Trust and Termination of Assignments and Financing Statements.

     If and when Grantor has paid and performed all of the Obligations, and no further advances are to be made under the Loan Agreement and all Swap Contracts have been terminated, Trustee, upon request by Beneficiary, will provide a release of the Property from the lien of this Deed of Trust and termination statements for filed financing statements, if any, to Grantor. Grantor shall be responsible for the recordation of such release and the payment of any recording and filing costs. Upon the recording of such release and the filing of such termination statements, the absolute assignments set forth in Section 2.2 shall automatically terminate and become null and void. Partial releases of the Property from the lien of this Deed of Trust shall be made on the terms and subject to the conditions of the Loan Agreement. No partial release shall be sought, requested or required if any Event of Default has occurred which has not been cured.

Article III
Representations and Warranties

     Grantor makes the following representations and warranties to Beneficiary:

     Section 3.1 Title to Real Property.

     Grantor (a) owns fee simple title to the Real Property, (b) owns all of the beneficial and equitable interest in and to the Real Property, and (c) is lawfully seized and possessed of the Real Property. Grantor has the right and authority to convey the Real Property and does hereby convey the Real Property. The Real Property is subject to no Encumbrances other than the Permitted Encumbrances.

     Section 3.2 Title to Other Property.

     Grantor has good title to the Personalty, and the Personalty is not subject to any Encumbrance other than the Permitted Encumbrances. None of the Leases, Rents, Design and Development Documents, Contracts of Sale or Refinancing Commitments are subject to any Encumbrance other than the Permitted Encumbrances.

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     Section 3.3 Property Assessments.

     The Real Property is assessed for purposes of Property Assessments as a separate and distinct parcel from any other property, such that the Real Property shall never become subject to the Lien of any Property Assessments levied or assessed against any property other than the Real Property.

     Section 3.4 Independence of the Real Property.

     To Grantor’s knowledge, no buildings or other improvements on property not covered by this Deed of Trust rely on the Real Property or any interest therein to fulfill any requirement of any Governmental Authority for the existence of such property, building or improvements; and none of the Real Property relies, or will rely, on any property not covered by this Deed of Trust or any interest therein to fulfill any requirement of any Governmental Authority. To Grantor’s knowledge, the Real Property has been properly subdivided from all other property in accordance with the requirements of any applicable Governmental Authorities.

     Section 3.5 Existing Improvements.

     The existing Improvements, if any, were constructed, and are being used and maintained, in accordance with all applicable Laws, including zoning Laws.

     Section 3.6 Leases and Tenants.

     The Leases are valid and are in full force and effect, and Grantor is not in default under any of the terms thereof. Except as expressly permitted in the Loan Agreement, Grantor has not accepted any Rents in advance of the time the same became due under the Leases and has not forgiven, compromised or discounted any of the Rents. Grantor has title to and the right to assign the Leases and Rents to Beneficiary, and no other assignment of the Leases or Rents has been granted. To the best of Grantor’s knowledge and belief, no tenant or tenants occupying, individually or in the aggregate, more than five percent (5%) of the net rentable area of the Improvements are in default under their Lease(s) or are the subject of any bankruptcy, insolvency or similar proceeding.

Article IV
Affirmative Covenants

     Section 4.1 Obligations.

     Grantor agrees to promptly pay and perform all of the Obligations, time being of the essence in each case.

     Section 4.2 Property Assessments; Documentary Taxes.

     Grantor (a) will promptly pay in full and discharge all Property Assessments, and (b) will furnish to Beneficiary, upon demand, the receipted bills for such Property Assessments prior to the day upon which the same shall become delinquent. Property Assessments shall be considered delinquent as of the first day any interest or penalty commences to accrue thereon.

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Grantor will promptly pay all stamp, documentary, recordation, transfer and intangible taxes and all other taxes that may from time to time be required to be paid with respect to the Loan, the Note, this Deed of Trust or any of the other Loan Documents.

     Section 4.3 Permitted Contests.

     Grantor shall not be required to pay any of the Property Assessments, or to comply with any Law, so long as Grantor shall in good faith, and at its cost and expense, contest the amount or validity thereof, or take other appropriate action with respect thereto, in good faith and in an appropriate manner or by appropriate proceedings; provided that (a) such proceedings operate to prevent the collection of, or other realization upon, such Property Assessments or enforcement of the Law so contested, (b) there will be no sale, forfeiture or loss of the Property during the contest, (c) neither Beneficiary nor Trustee is subjected to any Claim as a result of such contest, and (d) Grantor provides assurances satisfactory to Beneficiary (including the establishment of an appropriate reserve account with Beneficiary) of its ability to pay such Property Assessments or comply with such Law in the event Grantor is unsuccessful in its contest. Each such contest shall be promptly prosecuted to final conclusion or settlement, and Grantor shall indemnify and save Beneficiary and Trustee harmless against all Claims in connection therewith. Promptly after the settlement or conclusion of such contest or action, Grantor shall comply with such Law and/or pay and discharge the amounts which shall be levied, assessed or imposed or determined to be payable, together with all penalties, fines, interests, costs and expenses in connection therewith.

     Section 4.4 Compliance with Laws.

     Grantor will comply with and not violate, and cause to be complied with and not violated, all present and future Laws applicable to the Property and its use and operation.

     Section 4.5 Maintenance and Repair of the Property.

     Grantor, at Grantor’s sole expense, will (a) keep and maintain Improvements and Accessories in good condition, working order and repair, and (b) make all necessary or appropriate repairs and Additions to Improvements and Accessories, so that each part of the Improvements and all of the Accessories shall at all times be in good condition and fit and proper for the respective purposes for which they were originally intended, erected, or installed.

     Section 4.6 Additions to Security.

     All right, title and interest of Grantor in and to all Improvements and Additions hereafter constructed or placed on the Property and in and to any Accessories hereafter acquired shall, without any further deed of trust, conveyance, assignment or other act by Grantor, become subject to the Lien of this Deed of Trust as fully and completely, and with the same effect, as though now owned by Grantor and specifically described in the granting clauses hereof. Grantor agrees, however, to execute and deliver to Trustee and/or Beneficiary such further documents as may be required by the terms of the Loan Agreement and the other Loan Documents.

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     Section 4.7 Subrogation; Vendor’s/Purchase Money Lien.

     To the extent permitted by Law, Beneficiary shall be subrogated, notwithstanding its release of record, to any Lien now or hereafter existing on the Property to the extent that such Lien is paid or discharged by Beneficiary whether or not from the proceeds of the Loan. This Section shall not be deemed or construed, however, to obligate Beneficiary to pay or discharge any Lien. If all or any portion of the proceeds of the loan evidenced by the Note or of any other secured indebtedness has been advanced for the purpose of paying the purchase price for all or a part of the Property, no vendor’s or purchase money lien is waived; and Beneficiary shall have, and is hereby granted, a vendor’s or purchase money lien on the Property as cumulative additional security for the secured indebtedness. Beneficiary may foreclose under this Deed of Trust or under the vendor’s or purchase money lien without waiving the other or may foreclose under both.

     Section 4.8 Leases.

          (a) Except as expressly permitted in the Loan Agreement, Grantor shall not enter into any Material Lease (as defined in the Loan Agreement) with respect to all or any portion of the Property without the prior written consent of Beneficiary.

          (b) Neither Trustee nor Beneficiary shall be obligated to perform or discharge any obligation of Grantor under any Lease. The assignment of Leases provided for in this Deed of Trust in no manner places on Beneficiary or Trustee any responsibility for (i) the control, care, management or repair of the Property, (ii) the carrying out of any of the terms and conditions of the Leases, (iii) any waste committed on the Property, or (iv) any dangerous or defective condition on the Property (whether known or unknown).

          (c) No approval of any Lease by Beneficiary shall be for any purpose other than to protect Beneficiary’s security and to preserve Beneficiary’s rights under the Loan Documents, and no such approval shall result in a waiver of a Default or Event of Default.

Article V
Negative Covenants

     Section 5.1 Encumbrances.

     Grantor will not permit any of the Property to become subject to any Encumbrance other than the Permitted Encumbrances. Within thirty (30) days after the filing of any mechanic’s lien or other Lien or Encumbrance against the Property, Grantor will promptly discharge the same by payment or filing a bond or otherwise as permitted by Law. So long as Beneficiary’s security has been protected by the filing of a bond or otherwise in a manner satisfactory to Beneficiary in its sole and absolute discretion, Grantor shall have the right to contest in good faith any Claim, Lien or Encumbrance, provided that Grantor does so diligently and without prejudice to Beneficiary or delay in completing construction of the Improvements. Grantor shall give Beneficiary Notice of any default under any Lien and Notice of any foreclosure or threat of foreclosure with respect to any of the Property.

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     Section 5.2 Transfer of the Property.

          (a) Grantor will not Transfer, or contract to Transfer, all or any part of the Property or any legal or beneficial interest therein (except for certain Transfers of the Accessories expressly permitted in this Deed of Trust). The Transfer of more than 10% of the membership interests in Grantor (whether in one or more transactions during the term of the Loans) shall be deemed to be a prohibited Transfer of the Property.

          (b) Provided that no Event of Default is then continuing hereunder or under any of the other Loan Documents, the following Transfers shall be permitted under this Section 5.2 without the prior written consent of Beneficiary:

          (1) a Transfer of corporate stock, partnership interests (other than the general partner’s direct interests in Grantor) and/or membership interests (other than the managing member’s direct interests in Grantor) in Grantor, or in any partner or member of Grantor, or any direct or indirect legal or beneficial owner of Grantor, so long as following such Transfer (whether in one or a series of transactions) or, with respect to any creation or issuance of new limited partnership interests or membership interests, not more than 49% of the beneficial economic interest in Grantor (whether directly or indirectly) has been transferred in the aggregate, and there is no Change of Control (defined below) and the persons responsible for the day to day management of the Property and Grantor remain unchanged following such Transfer;

          (2) any involuntary Transfer caused by the death of any partner, shareholder, joint venturer, member or beneficial owner of a trust, or any direct or indirect legal or beneficial owner of Grantor, so long as Grantor is promptly reconstituted, if required, following such death and so long as there is no Change of Control (defined below) and those persons responsible for the day to day management of the Property and Grantor remain unchanged as a result of such death (other than any decedent) or any replacement management or controlling parties are approved by Beneficiary;

          (3) a Transfer comprised of gifts for estate planning purposes of any individual’s interests in Grantor, or in any of Grantor’s partners, members, shareholders, beneficial owners of a trust or joint venturers, or any direct or indirect legal or beneficial owner of Grantor, to the spouse, any lineal descendant, or the spouse of any lineal descendant of such individual, or to a trust for the benefit of any one or more of such individual, spouse, any lineal descendant, or the spouse of any lineal descendant of such individual, so long as Grantor is reconstituted promptly, if required, following such gift and so long as there is no Change of Control and those persons responsible for the day to day management of the Property and Grantor remain unchanged following such gift.

          (4) Provided that no Event of Default is then continuing hereunder or under any of the other Loan Documents, or, if an Event of Default exists and such transfer would result in the cure of such Event of Default, the

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transfer of any tenant in common interest in the Property between the entities comprising Borrower (a “TIC Agreement Transfer”) shall be permitted by Lender, provided that (1) the financial condition of the transferee has not materially adversely changed since the date such transferee initially acquired tenant in common interests in the Property, (2) the TIC Agreement Transfer does not result in the violation of any applicable securities laws, (3) following the TIC Agreement Transfer no more than forty-nine percent (49%) of the undivided ownership interests in the Property will be held by any Person and its Affiliates who together owned less than a forty-nine percent (49%) undivided ownership interest in the Property prior to the TIC Agreement Transfer, and (4) Lender shall have received and approved all documents evidencing or relating to the TIC Agreement Transfer (including without limitation, conveyance instruments, amendments to the Tenancy in Common Agreement and the Loan Documents to reflect changes in ownership percentages, and title insurance policy endorsements) as well as any other documents, instruments, opinions, endorsements or agreements reasonably required by Lender, and Lender shall have been paid all costs and expenses, including attorneys’ fees, incurred in connection with the TIC Agreement Transfer.

For purposes of this Section 5.2(b), “Change of Control” shall mean a change in the identity of the individual or entities or group of individuals or entities who have the right, by virtue of any partnership agreement, articles of incorporation, by-laws, articles of organization, operating agreement or any other agreement, with or without taking any formative action, to cause Grantor to take some action or to prevent, restrict or impede Grantor from taking some action which, in either case, Grantor could take or could refrain from taking were it not for the rights of such individuals. With respect to any Transfer of less than an undivided forty-nine percent (49%) interest in the Property that is subject to the prior written approval of Beneficiary, Beneficiary shall approve or disapprove any such matter within ten (10) Business Days of Beneficiary’s receipt of a written notice from Grantor requesting Beneficiary’s approval, provided such notice includes all information necessary to make such decision, and further provided that such written notice from Grantor shall conspicuously state, in large bold type, that “PURSUANT TO SECTION 5.2 OF THE DEED OF TRUST, A RESPONSE IS REQUIRED WITHIN TEN (10) BUSINESS DAYS OF BENEFICIARY’S RECEIPT OF THIS WRITTEN NOTICE”. If Beneficiary fails to disapprove any such matter within such period, Grantor shall provide a second written notice requesting approval, which written notice shall conspicuously state, in large bold type, that “PURSUANT TO SECTION 5.2 OF THE DEED OF TRUST, THE MATTER DESCRIBED HEREIN SHALL BE DEEMED APPROVED IF BENEFICIARY DOES NOT RESPOND TO THE CONTRARY WITHIN FIVE (5) BUSINESS DAYS OF BENEFICIARY’S RECEIPT OF THIS WRITTEN NOTICE”. Thereafter, if Beneficiary does not disapprove such matter within said five (5) Business Day period such matter shall be deemed approved.

     Section 5.3 Removal, Demolition or Alteration of Accessories and Improvements.

     Except to the extent permitted by the following sentence, no Improvements or Accessories shall be removed, demolished or materially altered without the prior written consent of Beneficiary. Grantor may remove and dispose of, free from the Lien of this Deed of Trust,

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such Accessories as from time to time become worn out or obsolete, provided that, either (a) Grantor reasonably determines that such Accessories are not necessary for the proper ownership or operation of the Property, (b) at the time of, or prior to, such removal, any such Accessories are replaced with other Accessories which are free from Liens other than Permitted Encumbrances and have a value at least equal to that of the replaced Accessories (and by such removal and replacement Grantor shall be deemed to have subjected such replacement Accessories to the Lien of this Deed of Trust), or (c) so long as a prepayment may be made without the imposition of any premium pursuant to the Note, such Accessories are sold at fair market value for cash and the net cash proceeds received from such disposition are paid over promptly to Beneficiary to be applied to the prepayment of the principal of the Loan.

     Section 5.4 Additional Improvements.

     Grantor will not construct any Improvements other than those presently on the Land and those described in the Loan Agreement without the prior written consent of Beneficiary. Grantor will complete and pay for, within a reasonable time, any Improvements which Grantor is permitted to construct on the Land. Grantor will construct and erect any permitted Improvements (a) strictly in accordance with all applicable Laws and any private restrictive covenants, (b) entirely on lots or parcels of the Land, (c) so as not to encroach upon any easement or right-of-way or upon the land of others, and (d) wholly within any building restriction and setback lines applicable to the Land.

     Section 5.5 Restrictive Covenants, Zoning, etc.

     Without the prior written consent of Beneficiary, Grantor will not initiate, join in, or consent to any change in, any restrictive covenant, easement, zoning ordinance, or other public or private restrictions limiting or defining the uses which may be made of the Property. Grantor (a) will promptly perform and observe, and cause to be performed and observed, all of the terms and conditions of all agreements affecting the Property, and (b) will do or cause to be done all things necessary to preserve intact and unimpaired any and all easements, appurtenances and other interests and rights in favor of, or constituting any portion of, the Property.

Article VI
Events of Default

     The occurrence or happening, from time to time, of any one or more of the following shall constitute an Event of Default under this Deed of Trust:

     Section 6.1 Payment Obligations.

     Grantor fails to pay any of the Obligations when due, whether on the scheduled due date or upon acceleration, maturity or otherwise.

     Section 6.2 Transfers.

          (a) Grantor Transfers, or contracts to Transfer, all or any part of the Property or any legal or beneficial interest therein (except for Transfers of the Accessories expressly permitted under this Deed of Trust). The Transfer of more than 10% of the membership interests

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in Grantor (whether in one or more transactions during the term of the Loans) shall be deemed to be a prohibited Transfer of the Property.

          (b) Provided that no Event of Default is then continuing hereunder or under any of the other Loan Documents, the Transfers set forth in Section 5.2(b) shall be permitted under this Section 6.2(b) without the prior written consent of Beneficiary.

     Section 6.3 Other Obligations.

     Grantor fails to promptly perform or comply with any of the Obligations set forth in this Deed of Trust (other than those expressly described in other Sections of this Article VI), and such failure continues uncured for a period of thirty (30) days after Notice from Beneficiary to Grantor; provided, however, that if such default is susceptible of cure but such cure cannot be accomplished with reasonable diligence within said period of time, and if Grantor commences to cure such default promptly after receipt of notice thereof from Beneficiary, and thereafter prosecutes the curing of such default with reasonable diligence, such period of time shall be extended for such period of time as may be necessary to cure such default with reasonable diligence, but not to exceed an additional sixty (60) days.

     Section 6.4 Event of Default Under Other Loan Documents.

     An Event of Default (as defined therein) occurs under the Note or the Loan Agreement, or Grantor or Guarantor fails to promptly pay, perform, observe or comply with any obligation or agreement contained in any of the other Loan Documents (within any applicable grace or cure period).

     Section 6.5 Default Under Other Lien Documents.

     A default by Grantor occurs under any other mortgage, deed of trust or security agreement covering the Property, including any Permitted Encumbrances.

     Section 6.6 Execution; Attachment.

     Any execution or attachment is levied against any of the Property, and such execution or attachment is not set aside, discharged or stayed within sixty (60) days after the same is levied.

Article VII
Rights and Remedies

     Upon the happening of and during the continuance of any Event of Default, Beneficiary shall have the right, in addition to any other rights or remedies available to Beneficiary under any of the Loan Documents or applicable Law, to exercise any one or more of the following rights, powers or remedies:

     Section 7.1 Acceleration.

     Beneficiary may accelerate all Obligations under the Loan Documents (except as provided below) whereupon such Obligations shall become immediately due and payable,

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without notice of default, notice of acceleration or intention to accelerate, presentment or demand for payment, protest, notice of protest, notice of nonpayment or dishonor, or notices or demands of any kind or character (all of which are hereby waived by Grantor); provided that the foregoing provisions of this Section 7.1 shall not be applicable to the Swap Contracts, and any acceleration of the obligations thereunder or exercise of other remedies thereunder shall be governed by the terms of the Swap Contracts.

     Section 7.2 Foreclosure.

     Trustee is authorized and empowered and it shall be his special duty at the request of Beneficiary to sell the Property or any part thereof situated in the State of Texas, at the courthouse of any county (whether or not the counties in which the Property is located are contiguous, if the Property is located in more than one county) in the State of Texas in which any part of the Property is situated, at public venue to the highest bidder for cash between the hours of ten o’clock a.m. and four o’clock p.m. on the first Tuesday in any month or at such other place, time and date as provided by the statutes of the State of Texas then in force governing sales of real estate under powers of sale conferred by deed of trust, after having given notice of such sale in accordance with such statutes. Any sale made by Trustee hereunder may be as an entirety or in such parcels as Beneficiary may request. To the extent permitted by applicable Law, any sale may be adjourned by announcement at the time and place appointed for such sale without further notice except as may be required by Law. The sale by Trustee of less than the whole of the Property shall not exhaust the power of sale herein granted, and Trustee is specifically empowered to make successive sale or sales under such power until the whole of the Property shall be sold; and, if the proceeds of such sale of less than the whole of the Property shall be less than the aggregate of the Obligations and the expense of executing this trust as provided herein, this Deed of Trust and the lien hereof shall remain in full force and effect as to the unsold portion of the Property just as though no sale had been made; provided, however, that Grantor shall never have any right to require the sale of less than the whole of the Property but Beneficiary shall have the right, at its sole election, to request Trustee to sell less than the whole of the Property. Trustee may, after any request or direction by Beneficiary, and as agent for the Beneficiary, sell not only the real property but also the Personalty and other interests which are a part of the Property, or any part thereof, as a unit and as a part of a single sale, or may sell any part of the Property separately from the remainder of the Property. It shall not be necessary for Trustee to have taken possession of any part of the Property or to have present or to exhibit at any sale any of the Personalty. After each sale, Trustee shall make to the purchaser or purchasers at such sale good and sufficient conveyances in the name of Grantor, conveying the property so sold to the purchaser or purchasers with general warranty of title of Grantor, subject to the Permitted Encumbrances (and to such leases and other matters, if any, as Trustee may elect upon request of Beneficiary), and shall receive the proceeds of said sale or sales and apply the same as herein provided. Payment of the purchase price to the Trustee shall satisfy the obligation of purchaser at such sale therefor, and such purchaser shall not be responsible for the application thereof. The power of sale granted herein shall not be exhausted by any sale held hereunder by Trustee or his substitute or successor, and such power of sale may be exercised from time to time and as many times as Beneficiary may deem necessary until all of the Property has been duly sold and all Obligations has been fully paid. In the event any sale hereunder is not completed or is defective in the opinion of Holder, such sale shall not exhaust the power of sale hereunder and Beneficiary shall have the right to cause a subsequent sale or sales to be made

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hereunder. Any and all statements of fact or other recitals made in any deed or deeds or other conveyances given by Trustee or any successor or substitute appointed hereunder as to nonpayment of the Obligations or as to the occurrence of any default, or as to Beneficiary’s having declared all of said indebtedness to be due and payable, or as to the request to sell, or as to notice of time, place and terms of sale and the properties to be sold having been duly given, or as to the refusal, failure or inability to act of Trustee or any substitute or successor trustee, or as to the appointment of any substitute or successor trustee, or as to any other act or thing having been duly done by Holder or by such Trustee, substitute or successor, shall be taken as prima facie evidence of the truth of the facts so stated and recited. The Trustee or his successor or substitute may appoint or delegate any one or more persons as agent to perform any act or acts necessary or incident to any sale held by Trustee, including the posting of notices and the conduct of sale, but in the name and on behalf of Trustee, his successor or substitute. If Trustee or his successor or substitute shall have given notice of sale hereunder, any successor or substitute Trustee thereafter appointed may complete the sale and the conveyance of the property pursuant thereto as if such notice had been given by the successor or substitute Trustee conducting the sale.

     Section 7.3 Judicial Action.

     Beneficiary shall have the right from time to time to sue Grantor for any sums (whether interest, damages for failure to pay principal or any installments thereof, taxes, or any other sums required to be paid under the terms of this Deed of Trust, as the same become due), without regard to whether or not any of the other Obligations shall be due, and without prejudice to the right of Beneficiary thereafter to enforce any appropriate remedy against Grantor, including an action of foreclosure or an action for specific performance, for a Default or Event of Default existing at the time such earlier action was commenced.

     Section 7.4 Collection of Rents.

     Upon the occurrence of an Event of Default, the license granted to Grantor to collect the Rents shall be automatically and immediately revoked, without further notice to or demand upon Grantor. Beneficiary may, but shall not be obligated to, perform any or all obligations of the landlord under any or all of the Leases, and Beneficiary may, but shall not be obligated to, exercise and enforce any or all of Grantor’s rights under the Leases. Without limiting the generality of the foregoing, Beneficiary may notify the tenants under the Leases that all Rents are to be paid to Beneficiary, and following such notice all Rents shall be paid directly to Beneficiary and not to Grantor or any other Person other than as directed by Beneficiary, it being understood that a demand by Beneficiary on any tenant under the Leases for the payment of Rent shall be sufficient to warrant payment by such tenant of Rent to Beneficiary without the necessity of further consent by Grantor. Grantor hereby irrevocably authorizes and directs the tenants under the Leases to pay all Rents to Beneficiary instead of to Grantor, upon receipt of written notice from Beneficiary, without the necessity of any inquiry of Grantor and without the necessity of determining the existence or non-existence of an Event of Default. Grantor hereby appoints Beneficiary as Grantor’s attorney-in-fact with full power of substitution, which appointment shall take effect upon the occurrence of an Event of Default and is coupled with an interest and is irrevocable prior to the full and final payment and performance of the Obligations, in Grantor’s name or in Beneficiary’s name: (a) to endorse all checks and other instruments

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received in payment of Rents and to deposit the same in any account selected by Beneficiary; (b) to give receipts and releases in relation thereto; (c) to institute, prosecute and/or settle actions for the recovery of Rents; (d) to modify the terms of any Leases including terms relating to the Rents payable thereunder; (e) to cancel any Leases; (f) to enter into new Leases; and (g) to do all other acts and things with respect to the Leases and Rents which Beneficiary may deem necessary or desirable to protect the security for the Obligations. Any Rents received shall be applied first to pay all Expenses and next in reduction of the other Obligations. Grantor shall pay, on demand, to Beneficiary, the amount of any deficiency between (i) the Rents received by Beneficiary, and (ii) all Expenses incurred together with interest thereon as provided in the Loan Agreement and the other Loan Documents.

     Section 7.5 Taking Possession or Control of the Property.

     As an absolute matter of right without regard to the adequacy of the security, and to the extent permitted by Law without notice to Grantor, Beneficiary shall be entitled, upon ex parte application to a court of competent jurisdiction, to the immediate appointment of a receiver for all or any part of the Property and the Rents, whether such receivership may be incidental to a proposed sale of the Property or otherwise, and Grantor hereby consents to the appointment of such a receiver and agrees that such receiver shall have all of the rights and powers granted to Beneficiary pursuant to Section 7.4. In addition, to the extent permitted by Law, and with or without the appointment of a receiver, or an application therefor, Beneficiary may (a) enter upon, and take possession of (and Grantor shall surrender actual possession of), the Property or any part thereof, without notice to Grantor and without bringing any legal action or proceeding, or, if necessary by force, legal proceedings, ejectment or otherwise, and (b) remove and exclude Grantor and its agents and employees therefrom.

     Section 7.6 Management of the Property.

     Upon obtaining possession of the Property or upon the appointment of a receiver as described in Section 7.5, Beneficiary, Trustee or the receiver, as the case may be, may, at its sole option, (a) make all necessary or proper repairs and Additions to or upon the Property, (b) operate, maintain, control, make secure and preserve the Property, and (c) complete the construction of any unfinished Improvements on the Property and, in connection therewith, continue any and all outstanding contracts for the erection and completion of such Improvements and make and enter into any further contracts which may be necessary, either in their or its own name or in the name of Grantor (the costs of completing such Improvements shall be Expenses secured by this Deed of Trust and shall accrue interest as provided in the Loan Agreement and the other Loan Documents). Beneficiary, Trustee or such receiver shall be under no liability for, or by reason of, any such taking of possession, entry, holding, removal, maintaining, operation or management, except for gross negligence or willful misconduct. The exercise of the remedies provided in this Section shall not cure or waive any Event of Default, and the enforcement of such remedies, once commenced, shall continue for so long as Beneficiary shall elect, notwithstanding the fact that the exercise of such remedies may have, for a time, cured the original Event of Default.

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     Section 7.7 Uniform Commercial Code.

     Beneficiary may proceed under the Uniform Commercial Code as to all or any part of the Personalty, and in conjunction therewith may exercise all of the rights, remedies and powers of a secured creditor under the Uniform Commercial Code. Upon the occurrence of any Event of Default, Grantor shall assemble all of the Accessories and make the same available within the Improvements. Any notification required by the Uniform Commercial Code shall be deemed reasonably and properly given if sent in accordance with the Notice provisions of this Deed of Trust at least ten (10) days before any sale or other disposition of the Personalty. Disposition of the Personalty shall be deemed commercially reasonable if made pursuant to a public sale advertised at least twice in a newspaper of general circulation in the community where the Property is located. It shall be deemed commercially reasonable for the Trustee to dispose of the Personalty without giving any warranties as to the Personalty and specifically disclaiming all disposition warranties. Alternatively, Beneficiary may choose to dispose of some or all of the Property, in any combination consisting of both Personalty and Real Property, in one sale to be held in accordance with the Law and procedures applicable to real property, as permitted by Article 9 of the Uniform Commercial Code. Grantor agrees that such a sale of Personalty together with Real Property constitutes a commercially reasonable sale of the Personalty.

     Section 7.8 Application of Proceeds.

     Unless otherwise provided by applicable Law, all proceeds from the sale of the Property or any part thereof pursuant to the rights and remedies set forth in this Article VII and any other proceeds received by Beneficiary from the exercise of any of its other rights and remedies hereunder or under the other Loan Documents shall be applied first to pay all Expenses and next in reduction of the other Obligations, in such manner and order as Beneficiary may elect.

     Section 7.9 Other Remedies.

     Beneficiary shall have the right from time to time to protect, exercise and enforce any legal or equitable remedy against Grantor provided under the Loan Documents or by applicable Laws.

Article VIII
Trustee

     Section 8.1 Liability of Trustee.

     Trustee shall have no liability or responsibility for, and make no warranties in connection with, the validity or enforceability of any of the Loan Documents or the description, value or status of title to the Property. Trustee shall be protected in acting upon any notice, request, consent, demand, statement, note or other paper or document believed by Trustee to be genuine and to have been signed by the party or parties purporting to sign the same. Trustee shall not be liable for any error of judgment, nor for any act done or step taken or omitted, nor for any mistakes of law or fact, nor for anything which Trustee may do or refrain from doing in good faith, nor generally shall Trustee have any accountability hereunder. WITHOUT LIMITATION, THE FOREGOING LIMITATIONS OF LIABILITY SHALL APPLY TO TRUSTEE WITH RESPECT TO MATTERS WHICH IN WHOLE OR IN PART ARE

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CAUSED BY OR ARISE OUT OF, OR ARE CLAIMED TO BE CAUSED BY OR ARISE OUT OF, THE NEGLIGENCE (WHETHER SOLE, COMPARATIVE OR CONTRIBUTORY) OR STRICT LIABILITY OF TRUSTEE. HOWEVER, SUCH INDEMNITIES SHALL NOT APPLY TO TRUSTEE TO THE EXTENT THAT THE SUBJECT OF THE INDEMNIFICATION IS CAUSED BY OR ARISES OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF TRUSTEE. The powers and duties of Trustee hereunder may be exercised through such attorneys, agents or servants as Trustee may appoint, and Trustee shall have no liability or responsibility for any act, failure to act, negligence or willful conduct of such attorney, agent or servant, so long as the selection was made with reasonable care. In addition, Trustee may consult with legal counsel selected by Trustee, and Trustee shall have no liability or responsibility by reason of any act or failure to act in accordance with the opinions of such counsel. Trustee may act hereunder and may sell or otherwise dispose of the Property or any part thereof as herein provided, although Trustee has been, may now be or may hereafter be, an attorney, officer, agent or employee of Beneficiary, in respect of any matter or business whatsoever. Trustee, however, shall have no obligation to sell all or any part of the Property following an Event of Default or to take any other action authorized to be taken by Trustee hereunder except upon the demand of Beneficiary.

     Section 8.2 Indemnification of Trustee.

     Grantor agrees to indemnify Trustee and to hold Trustee harmless from and against any and all Claims and Expenses directly or indirectly arising out of or resulting from any transaction, act, omission, event or circumstance in any way connected with the Property or the Loan, including but not limited to any Claim arising out of or resulting from any assertion or allegation that Trustee is liable for any act or omission of Grantor or any other Person in connection with the ownership, development, financing, operation or sale of the Property. WITHOUT LIMITATION, THE FOREGOING INDEMNITIES SHALL APPLY TO TRUSTEE WITH RESPECT TO MATTERS WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF, OR ARE CLAIMED TO BE CAUSED BY OR ARISE OUT OF, THE NEGLIGENCE (WHETHER SOLE, COMPARATIVE OR CONTRIBUTORY) OR STRICT LIABILITY OF TRUSTEE. HOWEVER, SUCH INDEMNITIES SHALL NOT APPLY TO TRUSTEE TO THE EXTENT THAT THE SUBJECT OF THE INDEMNIFICATION IS CAUSED BY OR ARISES OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF TRUSTEE. The agreements and indemnifications contained in this Section shall apply to Claims arising both before and after the repayment of the Loan and shall survive the repayment of the Loan, any foreclosure or deed, conveyance or assignment in lieu thereof and any other action by Trustee to enforce the rights and remedies of Beneficiary or Trustee hereunder or under the other Loan Documents.

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     Section 8.3 Substitution of Trustee; Multiple Trustees.

     Beneficiary shall have, and is hereby granted with warranty of further assurances, the irrevocable power to appoint a new or replacement or substitute Trustee. Such power may be exercised at any time without notice, without cause and without specifying any reason therefor, by filing for record in the office where this Deed of Trust is recorded a Substitution of Trustee. The power of appointment of a successor Trustee may be exercised as often as and whenever Beneficiary may choose, and the exercise of the power of appointment, no matter how often, shall not be an exhaustion thereof. Upon the recordation of such Substitution of Trustee, the Trustee so appointed shall thereupon, without any further act or deed of conveyance, become fully vested with identically the same title and estate in and to the Property and with all the rights, powers, trusts and duties of its predecessor in the trust hereunder with like effect as if originally named as Trustee hereunder. Whenever in this Deed of Trust reference is made to Trustee, it shall be construed to mean each Person appointed as Trustee for the time being, whether original or successor in trust. All title, estate, rights, powers, trusts and duties granted to Trustee shall be in each Person appointed as Trustee so that any action hereunder by any Person appointed as Trustee shall for all purposes be deemed to be, and as effective as, the action of all Trustees.

Article IX
Miscellaneous

     Section 9.1 Rights, Powers and Remedies Cumulative.

     The Deed of Trust is a deed of trust and mortgage, and each right, power and remedy of Beneficiary or Trustee as provided for in this Deed of Trust, or in any of the other Loan Documents or now or hereafter existing by Law, shall be cumulative and concurrent and shall be in addition to every other right, power or remedy provided for in this Deed of Trust, or in any of the other Loan Documents or now or hereafter existing by Law, and the exercise or beginning of the exercise by Beneficiary or Trustee of any one or more of such rights, powers or remedies shall not preclude the simultaneous or later exercise by Beneficiary or Trustee of any or all such other rights, powers or remedies. In the event a foreclosure hereunder shall be commenced by Trustee, Beneficiary may at any time before the sale of the Property direct Trustee to abandon the sale, and may then institute suit for the collection of the Note and/or any other secured indebtedness, and for the foreclosure of this Deed of Trust. It is agreed that if Beneficiary should institute a suit for the collection of the Note or any other secured indebtedness and for the foreclosure of this Deed of Trust, Beneficiary may at any time before the entry of a final judgment in said suit dismiss the same, and require Trustee, to sell the Property in accordance with the provisions of this Deed of Trust.

     Section 9.2 No Waiver by Beneficiary or Trustee.

     No course of dealing or conduct by or among Beneficiary, Trustee and Grantor shall be effective to amend, modify or change any provisions of this Deed of Trust or the other Loan Documents. No failure or delay by Beneficiary or Trustee to insist upon the strict performance of any term, covenant or agreement of this Deed of Trust or of any of the other Loan Documents,

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or to exercise any right, power or remedy consequent upon a breach thereof, shall constitute a waiver of any such term, covenant or agreement or of any such breach, or preclude Beneficiary or Trustee from exercising any such right, power or remedy at any later time or times. By accepting payment after the due date of any of the Obligations, neither Beneficiary nor Trustee shall be deemed to waive the right either to require prompt payment when due of all other Obligations, or to declare an Event of Default for failure to make prompt payment of any such other Obligations. Neither Grantor nor any other Person now or hereafter obligated for the payment of the whole or any part of the Obligations shall be relieved of such liability by reason of (a) the failure of Beneficiary to comply with any request of Grantor or of any other Person to take action to foreclose this Deed of Trust or otherwise enforce any of the provisions of this Deed of Trust, or (b) any agreement or stipulation between any subsequent owner or owners of the Property and Beneficiary, or (c) Beneficiary’s extending the time of payment or modifying the terms of this Deed of Trust or any of the other Loan Documents without first having obtained the consent of Grantor or such other Person. Regardless of consideration, and without the necessity for any notice to or consent by the holder of any subordinate Lien on the Property, Beneficiary may release any Person at any time liable for any of the Obligations or any part of the security for the Obligations and may extend the time of payment or otherwise modify the terms of this Deed of Trust or any of the other Loan Documents without in any way impairing or affecting the Lien of this Deed of Trust or the priority of this Deed of Trust over any subordinate Lien. The holder of any subordinate Lien shall have no right to terminate any Lease regardless of whether or not such Lease is subordinate to this Deed of Trust. Beneficiary may resort to the security or collateral described in this Deed of Trust or any of the other Loan Documents in such order and manner as Beneficiary may elect in its sole discretion.

     Section 9.3 Waivers and Agreements Regarding Remedies.

     To the fullest extent Grantor may do so, under applicable law, Grantor hereby:

          (a) agrees that it will not at any time plead, claim or take advantage of any Laws now or hereafter in force providing for any appraisement, valuation, stay, extension or redemption, and waives and releases all rights of redemption, valuation, appraisement, stay of execution, extension and notice of election to accelerate the Obligations;

          (b) waives all rights to a marshalling of the assets of Grantor, including the Property, or to a sale in the inverse order of alienation in the event of a foreclosure of the Property, and agrees not to assert any right under any Law pertaining to the marshalling of assets, the sale in inverse order of alienation, the exemption of homestead, the administration of estates of decedents, or other matters whatsoever to defeat, reduce or affect the right of Beneficiary under the terms of this Deed of Trust to a sale of the Property without any prior or different resort for collection, or the right of Beneficiary to the payment of the Obligations out of the proceeds of sale of the Property in preference to every other claimant whatsoever;

          (c) waives any right to bring or utilize any defense, counterclaim or setoff, other than one which denies the existence or sufficiency of the facts upon which any foreclosure action is grounded. If any defense, counterclaim or setoff, other than one permitted by the preceding clause, is timely raised in a foreclosure action, such defense, counterclaim or setoff shall be dismissed. If such defense, counterclaim or setoff is based on a Claim which could be

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tried in an action for money damages, such Claim may be brought in a separate action which shall not thereafter be consolidated with the foreclosure action. The bringing of such separate action for money damages shall not be deemed to afford any grounds for staying the foreclosure action; and

          (d) waives and relinquishes any and all rights and remedies which Grantor may have or be able to assert by reason of the provisions of any Laws pertaining to the rights and remedies of sureties.

     Section 9.4 Successors and Assigns.

     All of the grants, covenants, terms, provisions and conditions of this Deed of Trust shall run with the Land and shall apply to and bind the successors and assigns of Grantor (including any permitted subsequent owner of the Property), and inure to the benefit of Beneficiary, its successors and assigns and to the successors in trust of Trustee.

     Section 9.5 No Warranty by Beneficiary.

     By inspecting the Property or by accepting or approving anything required to be observed, performed or fulfilled by Grantor or to be given to Beneficiary or Trustee pursuant to this Deed of Trust or any of the other Loan Documents, Beneficiary or Trustee shall not be deemed to have warranted or represented the condition, sufficiency, legality, effectiveness or legal effect of the same, and such acceptance or approval shall not constitute any warranty or representation with respect thereto by Beneficiary or Trustee.

     Section 9.6 Amendments.

     This Deed of Trust may not be modified or amended except by an agreement in writing, signed by the party against whom enforcement of the change is sought.

     Section 9.7 Severability.

     In the event any one or more of the provisions of this Deed of Trust or any of the other Loan Documents shall for any reason be held to be invalid, illegal or unenforceable, in whole or in part or in any other respect, or in the event any one or more of the provisions of the Loan Documents operates or would prospectively operate to invalidate this Deed of Trust or any of the other Loan Documents, then and in either of those events, at the option of Beneficiary, such provision or provisions only shall be deemed null and void and shall not affect the validity of the remaining obligations, and the remaining provisions of the Loan Documents shall remain operative and in full force and effect and shall in no way be affected, prejudiced or disturbed thereby.

     Section 9.8 Notices.

     All Notices required or which any party desires to give hereunder or under any other Loan Document shall be in writing and, unless otherwise specifically provided in such other Loan Document, shall be deemed sufficiently given or furnished if delivered by personal delivery, by nationally recognized overnight courier service or by certified United States mail,

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postage prepaid, addressed to the party to whom directed at the applicable address specified in the Preamble to this Deed of Trust (unless changed by similar notice in writing given by the particular party whose address is to be changed) or by facsimile. Any Notice shall be deemed to have been given either at the time of personal delivery or, in the case of courier or mail, as of the date of first attempted delivery at the address and in the manner provided herein, or, in the case of facsimile, upon receipt; provided that service of a Notice required by any applicable statute shall be considered complete when the requirements of that statute are met. Notwithstanding the foregoing, no notice of change of address shall be effective except upon actual receipt. This Section shall not be construed in any way to affect or impair any waiver of notice or demand provided in this Deed of Trust or in any other Loan Document or to require giving of notice or demand to or upon any Person in any situation or for any reason.

     Section 9.9 Joint and Several Liability.

     If Grantor consists of two (2) or more Persons, the term “Grantor” shall also refer to all Persons signing this Deed of Trust as Grantor, and to each of them, and all of them are jointly and severally bound, obligated and liable hereunder. Trustee or Beneficiary may release, compromise, modify or settle with any of Grantor, in whole or in part, without impairing, lessening or affecting the obligations and liabilities of the others of Grantor hereunder or under the Note. Any of the acts mentioned aforesaid may be done without the approval or consent of, or notice to, any of Grantor. Section 12.29 of the Loan Agreement (the “Joint Borrower Provisions”) is by this reference incorporated herein in its entirety.

     Section 9.10 Rules of Construction.

     The words “hereof,” “herein,” “hereunder,” “hereto,” and other words of similar import refer to this Deed of Trust in its entirety. The terms “agree” and “agreements” mean and include “covenant” and “covenants.” The words “include” and “including” shall be interpreted as if followed by the words “without limitation.” The headings of this Deed of Trust are for convenience of reference only and shall not be considered a part hereof and are not in any way intended to define, limit or enlarge the terms hereof. All references (a) made in the neuter, masculine or feminine gender shall be deemed to have been made in all such genders, (b) made in the singular or plural number shall be deemed to have been made, respectively, in the plural or singular number as well, (c) to the Loan Documents are to the same as extended, amended, restated, supplemented or otherwise modified from time to time unless expressly indicated otherwise, (d) to the Land, Improvements, Personalty, Real Property or Property shall mean all or any portion of each of the foregoing, respectively, and (e) to Articles or Sections are to the respective Articles or Sections contained in this Deed of Trust unless expressly indicated otherwise. Any term used or defined in the Uniform Commercial Code of the State, as in effect from time to time, which is not defined in this Deed of Trust shall have the meaning ascribed to that term in the Uniform Commercial Code of the State. If a term is defined in Article 9 of the Uniform Commercial Code of the State differently than in another Article of the Uniform Commercial Code of the State, the term shall have the meaning specified in Article 9.

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     Section 9.11 Governing Law.

     This Deed of Trust shall be construed, governed and enforced in accordance with the Laws in effect from time to time in the State. It is the intent of Grantor and Beneficiary and all other parties to the Loan Documents to conform to and contract in strict compliance with applicable usury Law from time to time in effect. In no way, nor in any event or contingency (including but not limited to prepayment, default, demand for payment, or acceleration of the maturity of any obligation), shall the interest taken, reserved, contracted for, charged, chargeable, or received under this Deed of Trust, or otherwise, exceed the maximum nonusurious amount permitted by applicable Law (the “Maximum Amount”). If, from any possible construction of any document, interest would otherwise be payable in excess of the Maximum Amount, any such construction shall be subject to the provisions of this Section and shall ipso facto be automatically reformed and the interest payable shall be automatically reduced to the Maximum Amount, without the necessity of execution of any amendment or new document. Beneficiary shall ever receive anything of value which is characterized as interest under applicable Law and which would apart from this provision be in excess of the Maximum Amount, an amount equal to the amount which would have been excessive interest shall, without penalty, be applied to the reduction of the principal amount owing on the Obligations in the inverse order of its maturity and not to the payment of interest, or refunded to Grantor or the other payor thereof if and to the extent such amount which would have been excessive exceeds such unpaid principal. The right to accelerate maturity of the Note or any other Obligations does not include the right to accelerate any interest which has not otherwise accrued on the date of such acceleration, and does not intend to charge or receive any unearned interest in the event of acceleration. All interest paid or agreed to be paid to shall, to the extent permitted by applicable Law, be amortized, prorated, allocated and spread throughout the full stated term (including any renewal or extension) of such indebtedness so that the amount of interest on account of such indebtedness does not exceed the Maximum Amount. As used in this Section, the term “applicable Law” shall mean the Laws of the State where the Property is located or where the Obligations are is payable, or the federal Laws of the United States applicable to this transaction, whichever Laws allow the greatest interest, as such Laws now exist or may be changed or amended or come into effect in the future.

     Section 9.12 Entire Agreement.

     The Loan Documents constitute the entire understanding and agreement between Grantor and Beneficiary with respect to the transactions arising in connection with the Loan, and supersede all prior written or oral understandings and agreements between Grantor and Beneficiary with respect to the matters addressed in the Loan Documents. In particular, and without limitation, the terms of any commitment by Beneficiary to make the Loan are merged into the Loan Documents. Except as incorporated in writing into the Loan Documents, there are no representations, understandings, stipulations, agreements or promises, oral or written, with respect to the matters addressed in the Loan Documents.

     THE WRITTEN LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF

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PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.

THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

[Signatures on following pages]

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     IN WITNESS WHEREOF, Grantor has caused this Deed of Trust to be executed as of the day and year first written above.

GRANTOR: NNN WESTERN PLACE, LLC, a Delaware limited liability company
By:	NNN Western Place Manager, LLC, a Delaware limited liability company, its Manager
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Manager
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Office
NNN WESTERN PLACE 1, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 2, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

S-1

NNN WESTERN PLACE 3, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 4, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 5, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 6, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

S-2

NNN WESTERN PLACE 7, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
GREIT — WESTERN PLACE, LP, a Texas limited partnership
By:	GREIT — Western Place GP, LLC, a Delaware limited liability company, its General Partner
By:	G REIT Liquidating Trust dated January 22, 2008, a Maryland Trust, its Sole Member and Manager
By:	Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace, and Gary T. Wescombe, as Trustees of the G REIT Liquidating Trust dated January 22, 2008
By:	/s/ Andrea R. Biller
	Name:	Andrea R. Biller
	Title:	Authorized Representative

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ACKNOWLEDGMENT

STATE OF CALIFORNIA	)
	)
COUNTY OF ORANGE	)

On February 15, 2008, before me, P.C. Han, a Notary Public, personally appeared Jeffrey T. Hanson who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature /s/ Phil C. Han  

My Commission Expires:
June 25, 2011

[Seal] P.C. Han
[Seal] Commission # 1753200
[Seal] Notary Public — California
[Seal] Orange County
[Seal] My Comm. Expires Jun 25, 2011

ACKNOWLEDGMENT

STATE OF CALIFORNIA	)
	)
COUNTY OF ORANGE	)

On February 15, 2008, before me, P.C. Han, a Notary Public, personally appeared Jeffrey T. Hanson who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature /s/ Phil C. Han  

My Commission Expires:
June 25, 2011

[Seal] P.C. Han
[Seal] Commission # 1753200
[Seal] Notary Public — California
[Seal] Orange County
[Seal] My Comm. Expires Jun 25, 2011

ACKNOWLEDGMENT

STATE OF CALIFORNIA	)
	)
COUNTY OF ORANGE	)

On February 15, 2008, before me, P.C. Han, a Notary Public, personally appeared Jeffrey T. Hanson who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature /s/ Phil C. Han 

My Commission Expires:
June 25, 2011

[Seal] P.C. Han
[Seal] Commission # 1753200
[Seal] Notary Public — California
[Seal] Orange County
[Seal] My Comm. Expires Jun 25, 2011

ACKNOWLEDGMENT

STATE OF CALIFORNIA	)
	)
COUNTY OF ORANGE	)

On February 15, 2008, before me, P.C. Han, a Notary Public, personally appeared Jeffrey T. Hanson who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature /s/ Phil C. Han  

My Commission Expires:
June 25, 2011

[Seal] P.C. Han
[Seal] Commission # 1753200
[Seal] Notary Public — California
[Seal] Orange County
[Seal] My Comm. Expires Jun 25, 2011

ACKNOWLEDGMENT

STATE OF CALIFORNIA	)
	)
COUNTY OF ORANGE	)

On February 15, 2008, before me, P.C. Han, a Notary Public, personally appeared Jeffrey T. Hanson who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature /s/ Phil C. Han  

My Commission Expires:
June 25, 2011

[Seal] P.C. Han
[Seal] Commission # 1753200
[Seal] Notary Public — California
[Seal] Orange County
[Seal] My Comm. Expires Jun 25, 2011

ACKNOWLEDGMENT

STATE OF CALIFORNIA	)
	)
COUNTY OF ORANGE	)

On February 15, 2008, before me, P.C. Han, a Notary Public, personally appeared Jeffrey T. Hanson who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature /s/ Phil C. Han 

My Commission Expires:
June 25, 2011

[Seal] P.C. Han
[Seal] Commission # 1753200
[Seal] Notary Public — California
[Seal] Orange County
[Seal] My Comm. Expires Jun 25, 2011

ACKNOWLEDGMENT

STATE OF CALIFORNIA	)
	)
COUNTY OF ORANGE	)

On February 15, 2008, before me, P.C. Han, a Notary Public, personally appeared Jeffrey T. Hanson who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature /s/ Phil C. Han  

My Commission Expires:
June 25, 2011

[Seal] P.C. Han
[Seal] Commission # 1753200
[Seal] Notary Public — California
[Seal] Orange County
[Seal] My Comm. Expires Jun 25, 2011

ACKNOWLEDGMENT

STATE OF CALIFORNIA	)
	)
COUNTY OF ORANGE	)

On February 15, 2008, before me, P.C. Han, a Notary Public, personally appeared Jeffrey T. Hanson who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature /s/ Phil C. Han  

My Commission Expires:
June 25, 2011

[Seal] P.C. Han
[Seal] Commission # 1753200
[Seal] Notary Public — California
[Seal] Orange County
[Seal] My Comm. Expires Jun 25, 2011

ACKNOWLEDGMENT

STATE OF CALIFORNIA	)
	)
COUNTY OF ORANGE	)

On February 15, 2008, before me, P.C. Han, a Notary Public, personally appeared Andrea R. Biller who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that she executed the same in her authorized capacity, and that by her signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature /s/ Phil C. Han  

My Commission Expires:
June 25, 2011

[Seal] P.C. Han
[Seal] Commission # 1753200
[Seal] Notary Public — California
[Seal] Orange County
[Seal] My Comm. Expires Jun 25, 2011

EX-10.24

EXHIBIT 10.24

REPAYMENT GUARANTY

     THIS REPAYMENT GUARANTY (this “Guaranty”) is made as of February 15, 2008, by GARY H. HUNT, W. BRAND INLOW, EDWARD A. JOHNSON, D. FLEET WALLACE, and GARY T. WESCOMBE, as Trustees of the G REIT Liquidating Trust dated January 22, 2008 (the “Guarantor”) in favor of WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association (“Lender”).

     1. Except as otherwise provided in this Guaranty, initially capitalized terms used in this Guaranty without definition are defined in that certain Loan Agreement of even date herewith by and between NNN Western Place, LLC, a Delaware limited liability company, NNN Western Place 1, LLC, a Delaware limited liability company, NNN Western Place 2, LLC, a Delaware limited liability company, NNN Western Place 3, LLC, a Delaware limited liability company, NNN Western Place 4, LLC, a Delaware limited liability company, NNN Western Place 5, LLC, a Delaware limited liability company, NNN Western Place 6, LLC, a Delaware limited liability company, NNN Western Place 7, LLC, a Delaware limited liability company, and GREIT — Western Place, LP, a Texas limited partnership (collectively, the “Borrower”) and Lender (the “Loan Agreement”).

     2. In order to induce Lender to extend to Borrower a loan (whether acting on behalf of itself or any estate created by the commencement of a case under Title 11 United States Code or any successor statute thereto (the “Bankruptcy Code”) or any other insolvency, bankruptcy, reorganization or liquidation proceeding, or by any trustee under the Bankruptcy Code, liquidator, sequestrator or receiver of Borrower or Borrower’s property or similar Person duly appointed pursuant to any law generally governing any insolvency, bankruptcy, reorganization, liquidation, receivership or like proceeding) in the sum of $28,000,000.00 (the “Loan”), evidenced by a secured promissory note (“Note”), in the aggregate principal amount of $28,000,000.00, each now or hereafter executed by Borrower and payable to the order of Lender, Guarantor hereby unconditionally and irrevocably guarantees to Lender and to its successors, endorsees and/or assigns, the full and prompt payment of (a) the principal sum of the Note in accordance with its terms when due, by acceleration or otherwise, together with all interest accrued thereon, when due under the terms of the Note, and any and all other sums of money that become owing by Borrower to Lender under the Note, Loan Agreement or any other “Loan Document” as such term is defined in the Loan Agreement (which Note, Loan Agreement and other “Loan Documents” are also collectively referred to herein as the “Loan Documents”) and (b) any and all sums owing under any “Swap Contract” as such term is defined in the Loan Agreement (“Swap Contract”). The obligations guaranteed pursuant to this Section 2 are hereinafter referred to as the “Guaranteed Obligations.”

          Notwithstanding the foregoing, Guarantor’s obligations hereunder shall in no event exceed an amount equal to $7,400,000.00 of the principal amount of the Loan outstanding on the date the Notes become due and payable in full, whether at maturity or by acceleration or otherwise (the “Guaranteed Principal Amount”), plus 100% of (a) all interest owing on the Loan; (b) attorneys’ fees and collection costs and all other sums other than principal owing on the Loan; and (c) any deficiency, loss or damage actually suffered by Lender because of: (1) Borrower’s commission of a criminal act; (2) the failure to comply with provisions of the

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Loan Documents prohibiting the sale, transfer or encumbrance of the Project; (3) the misapplication by Borrower of any funds derived from the Project, including security deposits, insurance proceeds, condemnation awards, rental income or other income arising with respect to the Project; (4) Borrower’s commission of waste; (5) Borrower’s removal of collateral from the Project without replacement, (6) Borrower’s violation of law; (7) failure to pay real property taxes, assessments or other charges which would create liens on any portion of the Project; (8) losses, expense or liability relating to the presence of hazardous or toxic materials on the Project; (9) the fraud or intentional misrepresentation by Borrower made in or in connection with the Loan Documents or the Loan; (10) Borrower’s voluntary filing of any proceeding for relief under any federal or state bankruptcy, insolvency or receivership laws or any assignment for the benefit of creditors made by Borrower not dismissed within 180 days; (11) any involuntary filing against Borrower of any proceeding for relief under any federal or state bankruptcy, insolvency or receivership laws or any assignment for the benefit of creditors, but only if such involuntary filing was made by Borrower or an Affiliate of Borrower, or at the instigation or in collusion or acquiescence with Borrower or an Affiliate of Borrower; (12) Borrower’s interference with Lender’s enforcement proceedings (other than in good faith by reason of a legitimate defense); (13) Borrower’s failure to maintain required insurance; (14) Borrower’s collection of rent more than one month in advance; (15) any amount owing to Lender under indemnity provisions that relate to liabilities to third parties resulting from acts or omissions of Borrower, contractors or such other third parties with whom Borrower has dealt, and/or from the ownership, occupancy or use of the Project; (16) any amounts necessary to ensure lien-free completion of any tenant improvements which Borrower is obligated to construct under any leases; (17) any violation of Section 12.29 of the Loan Agreement; (18) any modification of the TIC Agreement in violation of Section 11.1(u) of the Loan Agreement; or (19) any violation of Section 11.1(v) of the Loan Agreement. Guarantor’s obligations shall not be affected, impaired, lessened or released by loans, credits or other financial accommodations now existing or hereafter advanced by Lender to Borrower in excess of the Guaranteed Principal Amount. In no event shall the Guaranteed Principal Amount be reduced as a result of (a) Lender’s foreclosure or acceptance of a deed in lieu of foreclosure with respect to any collateral securing the Loan, or (b) Guarantor’s payment of the Loan or any portion thereof prior to the date when the entire Loan becomes due and payable in full, whether at maturity or by acceleration or otherwise. The agreement of Lender to the foregoing limitation on Guarantor’s liability shall in no way be deemed to limit or restrict the right of Lender to apply any sums paid by Guarantor to any portion of the Loan.

          The indebtedness guaranteed by Guarantor hereunder shall be deemed to be the last indebtedness which remains outstanding under the Loan Documents after the application of payments received from Borrower and the application of proceeds received from the foreclosure of the Mortgage and other liquidation of any collateral for the Loan (subject to the above limitations on the maximum amount of principal indebtedness guaranteed hereby), and Guarantor may not claim or contend so long as any such indebtedness remains outstanding that any payments received by Lender from Borrower or otherwise, or proceeds received by Lender on the liquidation of the Project, shall have reduced or discharged Guarantor’s liability or obligations hereunder. Nothing contained in this paragraph shall be deemed to (i) limit or otherwise impair any of the waivers or agreements of Guarantor contained in this Guaranty or (ii) require Lender to proceed against Borrower, any collateral or any other Guarantor before proceeding against any particular Guarantor (any such requirement having been specifically waived).

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     3. (a) Guarantor waives any and all rights of subrogation, reimbursement, indemnification and contribution, and any other rights and defenses that are or may become available to Guarantor, including, without limitation, any and all rights or defenses Guarantor may have by reason of protection afforded to the principal with respect to any of the Guaranteed Obligations or to any other guarantor of any of the Guaranteed Obligations with respect to such guarantor’s obligations under its guaranty, in either case, pursuant to the antideficiency or other laws of this state limiting or discharging the principal’s indebtedness or such other guarantor’s obligations; and

          (b) Guarantor waives all rights and defenses that Guarantor may have because Borrower’s debt is secured by real property. This means, among other things:

          (i) Lender may collect from Guarantor without first foreclosing on any real or personal property collateral pledged by Borrower;

          (ii) If Lender forecloses on any real property collateral pledged by Borrower:

          (A) The amount of the debt may be reduced only by the price for which that collateral is sold at the foreclosure sale, even if the collateral is worth more than the sale price;

          (B) Lender may collect from Guarantor even if the Lender, by foreclosing on the real property collateral, has destroyed any right Guarantor may have to collect from Borrower.

This is an unconditional and irrevocable waiver of any rights and defenses Guarantor may have because Borrower’s debt is secured by real property; and

          (c) Guarantor waives all rights and defenses arising out of an election of remedies by Lender, even though that election of remedies, such as a nonjudicial foreclosure with respect to security for the Guaranteed Obligations, has destroyed Guarantor’s rights of subrogation and reimbursement against Borrower, and even though that election of remedies by Lender has destroyed Guarantor’s rights of contribution against another guarantor of any of the Guaranteed Obligations.

No other provision of this Guaranty shall be construed as limiting the generality of any of the covenants and waivers set forth in this Section 3.

     4. Guarantor represents and warrants to Lender that Guarantor has a financial interest in Borrower or is otherwise affiliated with Borrower. In that regard, Guarantor agrees that Lender’s agreement to make the Loan to Borrower is of substantial and material benefit to Guarantor and further agrees as follows:

          (a) Guarantor shall continue to be liable under this Guaranty and the provisions hereof will remain in full force and effect notwithstanding (i) any modification, agreement or stipulation between Borrower and Lender or their respective successors and assigns, with respect to the Loan Documents or the Swap Contracts or the obligations

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encompassed thereby, including, without limitation, the Guaranteed Obligations, (ii) Lender’s waiver of or failure to enforce any of the terms, covenants or conditions contained in the Loan Documents or the Swap Contracts or in any modification thereof, (iii) any discharge or release of Borrower or any other guarantor from any liability with respect to the Guaranteed Obligations, (iv) any discharge, release, exchange or subordination of any real or personal property then held by Lender as security for the performance of the Guaranteed Obligations, (v) any additional security taken for the Guaranteed Obligations, whether real or personal property, (vi) any foreclosure or other realization on any security for the Guaranteed Obligations, regardless of the effect upon Guarantor’s subrogation, contribution or reimbursement rights against Borrower or any other guarantor, (vii) any additional loans or financial accommodations to Borrower or (viii) the manner or order by which payments are applied to principal, interest or other obligations under the Loan Documents and the Swap Contracts. Without limiting the generality of the foregoing, Guarantor hereby agrees that Guarantor’s liability shall continue even if Lender alters any obligations under the Loan Documents or the Swap Contracts in any respect or Lender’s remedies or rights against Borrower are in any way impaired or suspended without Guarantor’s consent.

          (b) Guarantor’s liability under this Guaranty shall continue until all sums due under the Note have been paid in full and until all Guaranteed Obligations to Lender have been satisfied, and shall not be reduced by virtue of any payment by Borrower of any amount due under the Note or under any of the Loan Documents or Swap Contracts or Lender’s recourse to any collateral or security.

          (c) Guarantor represents and warrants to Lender that Guarantor now has and will continue to have full and complete access to any and all information concerning the transactions contemplated by the Loan Documents or Swap Contracts or referred to therein, the value of the assets owned or to be acquired by Borrower, Borrower’s financial status and its ability to pay and perform the Guaranteed Obligations owed to Lender. Guarantor further represents and warrants that Guarantor has reviewed and approved copies of the Loan Documents and Swap Contracts and is fully informed of the remedies Lender may pursue, with or without notice to Borrower, in the event of default under the Note or other Loan Documents or Swap Contracts. So long as any of the Guaranteed Obligations remains unsatisfied or owing to Lender, Guarantor shall keep fully informed as to all aspects of Borrower’s financial condition and the performance of the Guaranteed Obligations.

          (d) Guarantor acknowledges and agrees that Guarantor may be required to perform the Guaranteed Obligations in accordance with the terms hereof notwithstanding the fact that the Loan has fully matured, that the outstanding principal balance thereof is fully due and payable and that Borrower is in default of its obligation to pay the full amount due under the Note on the maturity thereof.

     5. The liability of Guarantor under this Guaranty is a guaranty of payment and performance and not of collectibility, and is not conditioned or contingent upon the genuineness, validity, regularity or enforceability of the Loan Documents, Swap Contracts or other instruments relating to the creation or performance of the Guaranteed Obligations or the pursuit by Lender of any remedies which any now has or may hereafter have with respect thereto under the Loan Documents or Swap Contracts, at law, in equity or otherwise. Guarantor hereby agrees

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that Guarantor shall be liable even if Borrower had no liability at the time of execution of any of the Loan Documents or Swap Contracts or thereafter ceases to be liable, and Guarantor’s liability may be larger in amount and more burdensome than that of Borrower. Guarantor’s liability hereunder shall not be limited or affected in any way by any impairment or any diminution or loss of value of any security or collateral for the Loan, whether caused by hazardous substances or otherwise, Lender’s failure to perfect a security interest in such security or collateral or any disability or other defense of Borrower or any other guarantor.

     6. Guarantor hereby waives to the extent permitted by law: (i) all notices to Guarantor, to Borrower, or to any other Person, including without limitation notices of the acceptance of this Guaranty or the creation, renewal, extension, modification, accrual of any of the Guaranteed Obligations owed to Lender, enforcement of any right or remedy with respect thereto and notice of any other matters relating thereto; (ii) diligence and demand of payment, presentment, protest, dishonor and notice of dishonor; (iii) any statute of limitations affecting Guarantor’s liability hereunder or the enforcement thereof; and (iv) all principles or provisions of law which conflict with the terms of this Guaranty. Guarantor further agrees that Lender may enforce this Guaranty upon the occurrence of an event of default under the Note or the other Loan Documents or Swap Contracts (as event of default is described therein), notwithstanding the existence of any dispute between Borrower and Lender with respect to the existence of said event of default or performance of the Guaranteed Obligations or any counterclaim, set-off or other claim which Borrower may allege against Lender with respect thereto. Moreover, Guarantor agrees that Guarantor’s obligations shall not be affected by any circumstances which constitute a legal or equitable discharge of a guarantor or surety.

     7. Guarantor agrees that Lender may enforce this Guaranty without the necessity of resorting to or exhausting any security or collateral (including, without limitation, pursuant to a judicial or nonjudicial foreclosure) and without the necessity of proceeding against Borrower or any other guarantor. Guarantor hereby waives the right to require Lender to proceed against Borrower, to proceed against any other guarantor, to foreclose any lien on any real or personal property, to exercise any right or remedy under the Loan Documents and Swap Contracts, to draw upon any letter of credit issued in connection herewith, or to pursue any other remedy or to enforce any other right.

     8. (a) Guarantor agrees that nothing contained herein shall prevent Lender from suing on the Note or from exercising any rights available to it under the Note or under any of the other Loan Documents or Swap Contracts and that the exercise of any of the aforesaid rights will not constitute a legal or equitable discharge of Guarantor. Guarantor understands that the exercise by Lender of certain rights and remedies contained in the Swap Contracts and Loan Documents (such as a nonjudicial foreclosure) may affect or eliminate Guarantor’s right of subrogation against Borrower and that Guarantor may therefore incur a partially or totally non-reimbursable liability hereunder; nevertheless, Guarantor hereby authorizes and empowers Lender to exercise, in its sole discretion, any rights and remedies, or any combination thereof, which may then be available to Lender, since it is the intent and purpose of Guarantor that the obligations hereunder are absolute, independent and unconditional under any and all circumstances. Guarantor expressly waives any defense (which defense, if Guarantor had not given this waiver, Guarantor might otherwise have) to a judgment against Guarantor by reason of a nonjudicial foreclosure sale. Notwithstanding any foreclosure of the lien of any mortgage or

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security agreement with respect to any or all of the real or personal property secured thereby, whether by the exercise of the power of sale contained therein, by an action for judicial foreclosure or by an acceptance of a deed in lieu of foreclosure, Guarantor shall remain bound under this Guaranty.

          (b) Guarantor shall have no right of subrogation against Borrower or against any collateral or security provided for in the Loan Documents or Swap Contracts and no right of reimbursement or contribution against any other guarantor unless and until all Guaranteed Obligations have been indefeasibly paid and satisfied in full, and Lender has released, transferred or disposed of all of their rights, title and interest in any collateral or security. To the extent the waiver of Guarantor’s rights of subrogation, reimbursement and contribution as set forth herein is found by a court of competent jurisdiction to be void or voidable for any reason, Guarantor further agrees that Guarantor’s rights of subrogation and reimbursement against Borrower and Guarantor’s rights of subrogation against any collateral or security shall be junior and subordinate to any rights Lender may have against Borrower and to all rights, title and interest Lender may have in such collateral or security, and Guarantor’s rights of contribution against any other guarantor shall be junior and subordinate to any rights Lender may have against such other guarantor. Lender may use, sell or dispose of any item of collateral or security as it sees fit without regard to Guarantor’s subrogation and contribution rights, and upon disposition or sale of any item, Guarantor’s rights with respect to such item will terminate. Guarantor understands that Guarantor may record a Request for Notice of Default and thereby receive notice of any proposed foreclosure of any real property collateral then securing the Guaranteed Obligations. With respect to the foreclosure of any security interest in any personal property collateral then securing the Guaranteed Obligations, Lender agrees to give Guarantor five (5) days’ prior written notice, in the manner set forth in Section 11 hereof, of any sale or disposition of any such personal property collateral, other than collateral which is perishable, threatens to decline speedily in value, is of a type customarily sold on a recognized market, or is cash, cash equivalents, certificates of deposit or the like.

          (c) Guarantor’s sole right with respect to any such foreclosure of real or personal property collateral shall be to bid at such sale in accordance with applicable law. Guarantor acknowledges and agrees that Lender may also bid at any such sale and in the event such collateral is sold to Lender in whole or in partial satisfaction of the Guaranteed Obligations (or any portion thereof), Guarantor shall have no further right or interest with respect thereto. Notwithstanding anything to the contrary contained herein, no provision of this Guaranty shall be deemed to limit, decrease, or in any way to diminish any rights of set-off Lender may have with respect to any cash, cash equivalents, certificates of deposit, letters of credit or the like which may now or hereafter be deposited with Lender by Borrower.

          (d) To the extent any dispute exists at any time between or among Guarantor and any other guarantor of the Guaranteed Obligations as to Guarantor’s or any other guarantor’s right to contribution or otherwise, Guarantor agrees to indemnify, defend and hold Lender harmless from and against any loss, damage, claim, demand, cost or any other liability (including, without limitation, reasonable attorneys’ fees and costs) Lender may suffer as a result of such dispute.

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          (e) So long as any of the Guaranteed Obligations are owing to Lender, Guarantor shall not, without the prior written consent of Lender, commence or join with any other party in commencing any bankruptcy, reorganization or insolvency proceedings of or against Borrower. The obligations of Guarantor under this Guaranty shall not be altered, limited or affected by any case, voluntary or involuntary, involving the bankruptcy, insolvency, receivership, reorganization, liquidation or arrangement of Borrower or by any defense which Borrower may have by reason of the order, decree or decision of any court or administrative body resulting from any such case. Lender shall have the sole right to accept or reject any plan on behalf of Guarantor proposed in such case and to take any other action which Guarantor would be entitled to take, including, without limitation, the decision to file or not file a claim. Guarantor acknowledges and agrees that any interest on the Guaranteed Obligations which accrues after the commencement of any such proceeding (or, if interest on any portion of the Guaranteed Obligations ceases to accrue by operation of law by reason of the commencement of said proceeding, such interest as would have accrued on any such portion of the Guaranteed Obligations if said proceedings had not been commenced) will be included in the Guaranteed Obligations because it is the intention of the parties that the Guaranteed Obligations should be determined without regard to any rule or law or order which may relieve Borrower of any portion of such Guaranteed Obligations. Guarantor hereby permits any trustee in bankruptcy, receiver, debtor in possession, assignee for the benefit of creditors or similar Person to pay Lender, or allow the claim of Lender in respect of, any such interest accruing after the date on which such proceeding is commenced. Guarantor hereby assigns to Lender Guarantor’s right to receive any payments from any trustee in bankruptcy, receiver, debtor in possession, assignee for the benefit of creditors or similar Person by way of dividend, adequate protection payment or otherwise. If all or any portion of the Guaranteed Obligations are paid or performed by Borrower, the obligations of Guarantor hereunder shall continue and remain in full force and effect in the event that all or any part of such payment(s) or performance(s) is avoided or recovered directly or indirectly from Lender as a preference, fraudulent transfer or otherwise in such case irrespective of payment in full of all obligations under the Loan Documents and Swap Contracts.

     9. (a) Guarantor represents and warrants that any financial statements, tax returns or other documents of Guarantor heretofore delivered to Lender are true and correct in all material respects. Such statements were prepared in accordance with generally accepted accounting principles, consistently applied and fairly present the financial position of Guarantor as of the date thereof. Guarantor further represents and warrants that no material adverse change has occurred in Guarantor’s financial position since the date of such statements.

          (b) Guarantor covenants and agrees to provide Lender with any and all financial information required by Lender pursuant to the Loan Agreement. Guarantor further covenants and agrees to immediately notify Lender of any material adverse change in Guarantor’s financial status.

     10. All notices, requests and demands to be made hereunder to the parties hereto must be in writing and given as provided in the notice provisions of the Loan Agreement (at the addresses set forth below).

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To Lender:	Wachovia Bank, National Association
	Real Estate Financial Services
	Mail Code: CA 6233
	15750 Alton Parkway
	Irvine, California 92618
	Attn: Anne McNeil
	Telephone: (949) 754-7034
	Facsimile: (949) 754-4814
To Guarantor:	G REIT Liquidating Trust dated January 22, 2008
	c/o Grubb & Ellis Realty Investors, LLC
	1551 N. Tustin Avenue, Suite 300
	Santa Ana, California 92705
	Attn: Andrea Biller
	Telephone: (714) 667-8252
	Facsimile: (714) 918-9138
With a copy to:	Gregory Kaplan, PLC
	7 East Second Street
	Richmond, Virginia
	Attn: Joseph J. McQuade, Esq.
	Telephone: (804) 525-1785
	Facsimile: (804) 525-1885

     11. Guarantor represents and warrants to Lender as follows:

          (a) No consent of any other Person, including, without limitation, any creditors of Guarantor, and no license, permit, approval or authorization of, exemption by, notice or report to, or registration, filing or declaration with, any governmental authority is required by Guarantor in connection with this Guaranty or the execution, delivery, performance, validity or enforceability of this Guaranty and all obligations required hereunder. This Guaranty has been duly executed and delivered by Guarantor, and constitutes the legally valid and binding obligation of Guarantor enforceable against Guarantor in accordance with its terms.

          (b) The execution, delivery and performance of this Guaranty will not violate any provision of any existing law or regulation binding on Guarantor, or any order, judgment, award or decree of any court, arbitrator or governmental authority binding on Guarantor, or of any mortgage, indenture, lease, contract or other agreement, instrument or undertaking to which Guarantor is a party or by which Guarantor or any of its assets may be bound, and will not result in, or require, the creation or imposition of any lien on any of Guarantor’s property, assets or revenues pursuant to the provisions of any such mortgage, indenture, lease, contract or other agreement, instrument or undertaking.

     12. Guarantor’s performance of a portion, but not all, of the Guaranteed Obligations will in no way limit, affect, modify or abridge Guarantor’s liability for that portion of the Guaranteed Obligations that is not performed. Without in any way limiting the generality of the foregoing, in the event that Lender is awarded a judgment in any suit brought to enforce

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Guarantor’s covenant to perform a portion of the Guaranteed Obligation, such judgment will in no way be deemed to release Guarantor from its covenant to perform any portion of the Guaranteed Obligation which is not the subject of such suit.

     13. Guarantor covenants and agrees to provide the financial information required for Guarantor in Section 10.8 of the Loan Agreement.

     14. Guarantor shall at all times maintain a combined net worth of at least Forty Million Dollars ($40,000,000). As used herein, “net worth” shall mean an amount equal to the gross fair market value of all of the applicable Guarantor’s assets (excluding any value for goodwill, trademarks, patents, copyrights and other similar intangible items), less an amount equal to all of such Guarantor’s liabilities (including guaranties and other contingent liabilities), all as reasonably determined by Lender.

     15. Guarantor shall at all times maintain combined unencumbered liquid assets equal to at least Five Million Dollars ($5,000,000). “Liquid assets” means the following assets of Guarantor: (i) Cash; (ii) certificates of deposit or time deposits with terms of six (6) months or less; (iii) A—1/P—1 commercial paper with a term of three (3) months or less; (iv) U.S. treasury bills and other obligations of the federal government, all with terms of six (6) months or less; (v) readily marketable securities (excluding “margin stock” (within the meaning of Regulation U of the Board of Governors of the Federal Reserve System), restricted stock and stock subject to the provisions of Rule 144 of the Securities and Exchange Commission); (vi) bankers’ acceptances issued for terms of six (6) months or less by financial institutions; (vii) repurchase agreements with terms of six (6) months or less covering U.S. government securities; (viii) unfunded capital commitments in Guarantor; and (ix) the undrawn amounts under credit lines available for disbursement to Guarantor.

     16. This Guaranty is solely for the benefit of Lender and is not intended to nor may it be deemed to be for the benefit of any third party, including Borrower.

     17. Guarantor represents and warrants to Lender as follows:

          (a) Guarantor, is duly formed and validly existing, and has the power to own its assets and to transact the business in which it is now engaged.

          (b) Guarantor has the power, authority and legal right to execute, deliver and perform this Guaranty and all obligations required hereunder and has taken all necessary action to authorize its execution, delivery and performance of this Guaranty and all obligations required hereunder. The execution, delivery and performance of this Guaranty will not violate any of the formation or governing documents of Guarantor or of any laws pursuant to which Guarantor has been formed.

     18. Guarantor hereby grants Lender a security interest in any personal property of Borrower in which Guarantor hereafter acquires any right, title or interest. Guarantor agrees that such security interest is additional security for the obligations hereby guaranteed. Such security interest is superior to any right of Guarantor in such personal property until all sums due under the Notes or other Loan Documents and Swap Contracts have been repaid in full and all Guaranteed Obligations have been fully satisfied.

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     19. Lender may assign this Guaranty with any Loan Document or Swap Contracts, without in any way affecting Guarantor’s liability hereunder. Any married person executing this Guaranty agrees that recourse may be had against community property and separate property for the satisfaction of all obligations hereby guaranteed. This Guaranty shall be binding upon Guarantor, Guarantor’s heirs, representatives, administrators, executors, successors and assigns and shall inure to the benefit of and shall be enforceable by Lender, and their successors, endorsees and assigns. As used herein, the singular includes the plural, and the masculine includes the feminine and neuter and vice versa, if the context so requires.

     20. In the event of any dispute or litigation regarding the enforcement or validity of this Guaranty, Guarantor shall be obligated to pay all charges, costs and expenses (including, without limitation, reasonable attorneys’ fees) incurred by Lender, whether or not any action or proceeding is commenced regarding such dispute and whether or not such litigation is prosecuted to judgment.

     21. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF TEXAS.

     22. To the maximum extent permitted by law, Guarantor and Lender hereby voluntarily, knowingly and intentionally WAIVE ANY AND ALL RIGHTS TO TRIAL BY JURY in any legal action or proceeding arising under or in connection with this Guaranty or any other Loan Document or Swap Contract or concerning the Guaranteed Obligations and/or any collateral therefor or pertaining to any transaction related to or contemplated in any Loan Document or Swap Contract, regardless of whether such action or proceeding concerns any contractual or tortious or other claim. Guarantor acknowledges that this waiver of jury trial is a material inducement to Lender in extending credit to Borrower, that Lender would not have extended such credit without this jury trial waiver, and that Guarantor has been represented by an attorney or has had an opportunity to consult with an attorney regarding this Guaranty and understands the legal effect of this jury trial waiver.

     23. Guarantor hereby submits to the jurisdiction of the state and federal courts in the State of Texas and State of California for purposes of any action arising from or growing out of this Guaranty, and further agrees that the venue of any such action may be laid in Orange County, California, or Tarrant County, Texas, and that (in addition to any other method provided by law for service of process) service of process in any such action may be made on Guarantor by the delivery of the process to Shannon Johnson, whose present address is c/o Grubb & Ellis Realty Investors, LLC, 1551 N. Tustin Avenue, Suite 300, Santa Ana, California 92705, whom Guarantor hereby appoints as Guarantor’s agent for service of process. Nothing contained in this Guaranty, however, shall be deemed to constitute, or to imply the existence of, any agreement by Lender to bring any such action only in said courts or to restrict in any way any of Lender’s remedies or rights to enforce the terms of this Guaranty as, when and where Lender shall deem appropriate, in its sole discretion.

     24. No provision of this Guaranty may be changed, waived, revoked or amended without Lender’s prior written consent. Every provision of this Guaranty is intended to be severable. If any term or provision hereof is declared to be illegal or invalid for any reason whatsoever by a court of competent jurisdiction, such illegality or invalidity will not affect the

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balance of the terms and provisions hereof, which terms and provisions will remain binding and enforceable.

     25. This Guaranty may be executed in any number of counterparts each of which shall be deemed an original and all of which shall constitute one and the same guaranty with the same effect as if all parties had signed the same signature page. Any signature page of this Guaranty may be detached from any counterpart of this Guaranty and reattached to any other counterpart of this Guaranty identical in form hereto but having attached to it one or more additional signature pages.

     26. No failure or delay on the part of Lender to exercise any power, right or privilege under this Guaranty will impair any such power, right or privilege, or be construed to be a waiver of any default or an acquiescence therein, nor will any single or partial exercise of such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege.

     27. This Guaranty embodies the entire agreement among the parties hereto with respect to the matters set forth herein, and supersedes all prior agreements among the parties with respect to the matters set forth herein. No course of prior dealing among the parties, no usage of trade, and no parol or extrinsic evidence of any nature may be used to supplement, modify or vary any of the terms hereof. There are no conditions to the full effectiveness of this Guaranty.

     28. This Guaranty is in addition to all other guaranties of Guarantor and any other guarantors of Borrower’s obligations to Lender.

     29. GUARANTOR ACKNOWLEDGES THAT GUARANTOR HAS BEEN AFFORDED THE OPPORTUNITY TO READ THIS DOCUMENT CAREFULLY AND TO REVIEW IT WITH AN ATTORNEY OF GUARANTOR’S CHOICE BEFORE SIGNING IT. GUARANTOR ACKNOWLEDGES HAVING READ AND UNDERSTOOD THE MEANING AND EFFECT OF THIS DOCUMENT BEFORE SIGNING IT.

     30. When two or more persons or entities have executed this Guaranty, unless the context clearly indicates otherwise, all references herein to “Guarantor” shall mean the guarantors hereunder or either or any of them. All of the obligations and liabilities of said guarantors under this Guaranty (and the obligations of other guarantors under any similar or other guaranties of part or all of the Guaranteed Obligations) shall be joint and several. Suit may be brought against said guarantors, jointly and severally, or against any one or more of them (even if less than all), without impairing the rights of Lender against the other or others of said guarantors; and Lender may settle with any one or more of said guarantors for such sums or sum as it may see fit and/or Lender may release any of said guarantors from all further liability to Lender for such indebtedness without impairing the right of Lender to demand and collect the balance of such indebtedness from the other or others of said guarantors not so released; but it is agreed among said guarantors themselves, however, that such settlement and release shall in no way impair the rights of said guarantors as among themselves.

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     IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of the date first above written.

“Guarantor”
G REIT LIQUIDATING TRUST DATED
JANUARY 22, 2008, a Maryland Trust
By:	Gary H. Hunt, W. Brand Inlow,
	Edward A. Johnson, D. Fleet Wallace,
	and Gary T. Wescombe, as Trustees of
	the G REIT Liquidating Trust dated
	January 22, 2008
By:	/s/ Andrea R. Biller
	Name:	Andrea R. Biller
	Title:	Authorized Representative

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EX-10.25

EXHIBIT 10.25

ENVIRONMENTAL INDEMNITY AGREEMENT

     This Environmental Indemnity Agreement (this “Agreement”), which is dated as of February 15, 2008, is executed by NNN WESTERN PLACE, LLC, a Delaware limited liability company, NNN WESTERN PLACE 1, LLC, a Delaware limited liability company, NNN WESTERN PLACE 2, LLC, a Delaware limited liability company, NNN WESTERN PLACE 3, LLC, a Delaware limited liability company, NNN WESTERN PLACE 4, LLC, a Delaware limited liability company, NNN WESTERN PLACE 5, LLC, a Delaware limited liability company, NNN WESTERN PLACE 6, LLC, a Delaware limited liability company, NNN WESTERN PLACE 7, LLC, a Delaware limited liability company, and GREIT — WESTERN PLACE, LP, a Texas limited partnership (individually and collectively, the “Borrower”), GARY H. HUNT, W. BRAND INLOW, EDWARD A. JOHNSON, D. FLEET WALLACE, and GARY T. WESCOMBE, as Trustees of the G REIT Liquidating Trust dated January 22, 2008, and NNN REALTY ADVISORS, INC., a Delaware corporation (individually and collectively, “Indemnitor”), as a condition of, and to induce WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association (“Lender”), to make, a loan (the “Loan”) to Borrower evidenced or to be evidenced by a Promissory Note of even date herewith, made by Borrower payable to the order of Lender in the face principal amount of $28,000,000.00 (the “Note”). The Loan is secured or to be secured by a Deed of Trust, Assignment, Security Agreement and Fixture Filing (the “Deed of Trust”) of even date herewith, encumbering certain real and personal property as therein described (collectively, the “Property”), including the land described in Exhibit A which is attached hereto and made a part hereof.

     1. Certain Definitions. As used in this Agreement:

          “Claim” means any controversy or claim between one or more Obligors and Lender, whether arising in contract or tort or by statute, that arises out of or relates to this Agreement, including any renewals, extensions or modifications hereof.

          “Cut-Off Date” means the earlier of the following two dates: (a) the date on which the indebtedness and obligations secured by the Deed of Trust have been paid and performed in full and the Deed of Trust has been released; or (b) the date on which the lien of the Deed of Trust is fully and finally foreclosed or a conveyance by deed in lieu of such foreclosure is fully and finally effective and possession of the Property has been given to and accepted by the purchaser or grantee free of occupancy and claims to occupancy by Obligors and their heirs, devisees, representatives, successors and assigns; provided, however, that if such payment, performance, release, foreclosure or conveyance is challenged in proceedings under any Debtor Relief Law or otherwise, the Cut-Off Date shall be deemed not to have occurred until such challenge is validly released, dismissed with prejudice or otherwise barred by law from further assertion.

          “Debtor Relief Law” means any federal, state or local law, domestic or foreign, as now or hereafter in effect relating to bankruptcy, insolvency, liquidation, receivership, reorganization, arrangement, composition, extension or adjustment of debts, or any similar law affecting the rights of creditors.

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          “Default” has the meaning ascribed to such term in the Deed of Trust and includes any breach of any covenant, representation or warranty and any other default under this Agreement, subject to any applicable notice and cure period.

          “Default Rate” has the meaning ascribed to such term in the Note.

          “Environmental Assessment” means a report (including all drafts thereof) of an environmental assessment of the Property of such scope as may be requested by Lender or another Indemnified Party, including the taking of soil borings and air and groundwater samples and other above- and below-ground testing, by a consulting firm acceptable to such Indemnified Party and made in accordance with the established guidelines of such Indemnified Party.

          “Environmental Claim” means any investigative, enforcement, cleanup, removal, containment, remedial or other private or governmental or regulatory action at any time threatened, instituted or completed pursuant to any applicable Environmental Requirement, against Borrower or any Obligor, against or with respect to the Property or any condition, use or activity on the Property (including any such action against any Indemnified Party), and any claim at any time threatened or made by any person against any Obligor or against or with respect to the Property or any condition, use or activity on the Property (including any such claim against any Indemnified Party), relating to damage, contribution, cost recovery, compensation, loss or injury resulting from or in any way arising in connection with any Hazardous Material or any Environmental Requirement.

          “Environmental Damages” means all claims, demands, liabilities (including strict liability), losses, damages (including consequential damages), causes of action, judgments, penalties, fines, reasonable costs and expenses (including fees, costs and expenses of attorneys, consultants, contractors, experts and laboratories), of any and every kind and character, contingent or otherwise, matured or unmatured, known or unknown, foreseeable or unforeseeable, made, incurred, suffered, brought, or imposed at any time and from time to time, and arising in whole or in part from any of the following matters, regardless of whether caused by an Obligor or a tenant or subtenant, or a prior owner of the Property or its tenant or subtenant, or any third party:

     (a) The presence of any Hazardous Material on the Property, or any escape, seepage, leakage, spillage, emission, release, discharge or disposal of any Hazardous Material on or from the Property, or the migration or release or threatened migration or release of any Hazardous Material to, from or through the Property, on or before the Cut-Off Date; or

     (b) Any act, omission, event or circumstance existing or occurring in connection with the handling, treatment, containment, removal, storage, decontamination, cleanup, transport or disposal of any Hazardous Material which is or was present on the Property on or before the Cut-Off Date; or

     (c) The breach of any representation, warranty, covenant or agreement contained in this Agreement because of any event or condition occurring or existing on or before the Cut-Off Date; or

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     (d) Any violation relating to the Property on or before the Cut-Off Date, of any Environmental Requirement in effect on or before the Cut-Off Date, regardless of whether any act, omission, event or circumstance giving rise to the violation constituted a violation at the time of the occurrence or inception of such act, omission, event or circumstance; or

     (e) Any Environmental Claim, or the filing or imposition of any environmental lien against the Property, because of, resulting from, in connection with, or arising out of any of the matters referred to in the preceding clauses (a) through (d).

     Without limiting the generality of the foregoing, “Environmental Damages” includes: (i) the investigation or remediation of any such Hazardous Material or violation of any such Environmental Requirement, including the preparation of any feasibility studies or reports and the performance of any cleanup, remediation, removal, response, abatement, containment, closure, restoration, monitoring or similar work required by any Environmental Requirement or necessary to have full use and benefit of the Property as contemplated by the Loan Documents (including any of the same in connection with any foreclosure action or transfer in lieu thereof); (ii) injury or damage to any person, property or natural resource occurring on or off the Property, including the cost of demolition and rebuilding of any improvements on real property; (iii) all liability to pay or indemnify any person or governmental authority for costs expended in connection with any of the matters included within this definition of Environmental Damages; (iv) the investigation and defense of any claim, whether or not such claim is ultimately defeated; and (v) the settlement of any claim or judgment.

          “Environmental Law” means any federal, state or local law, statute, ordinance, code, rule, regulation, license, authorization, decision, order, injunction, decree, or rule of common law, and any judicial interpretation of any of the foregoing, which pertains to health or safety (as they relate to natural resources or the environment), any Hazardous Material, or the environment (including ground or air or water or noise pollution or contamination, and underground or aboveground tanks) and shall include the Solid Waste Disposal Act, 42 U.S.C. § 6901 et seq.; the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9601 et seq. (“CERCLA”), as amended by the Superfund Amendments and Reauthorization Act of 1986 (“SARA”); the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et seq.; the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; the Clean Air Act, 42 U.S.C. § 7401 et seq.; the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq.; the Safe Drinking Water Act, 42 U.S.C. § 300f et seq.; and any other state or federal environmental statutes, and all rules, regulations, orders and decrees now or hereafter promulgated under any of the foregoing, as any of the foregoing now exist or may be changed or amended or come into effect in the future.

          “Environmental Requirement” means any Environmental Law, agreement or restriction, as the same now exists or may be changed or amended or come into effect in the future, which pertains to health or safety (as they relate to natural resources or the environment), any Hazardous Material, or the environment, including ground, air, water or noise pollution or contamination, and underground or aboveground tanks.

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          “Hazardous Material” means any substance, whether solid, liquid or gaseous: (a) which is listed, defined or regulated as a “hazardous substance”, “hazardous waste” or “solid waste”, or otherwise classified as hazardous or toxic, in or pursuant to any Environmental Requirement; or (b) which is or which contains asbestos, radon, any polychlorinated biphenyl, urea formaldehyde foam insulation, explosive or radioactive material, or motor fuel or other petroleum hydrocarbons; or (c) which causes or poses a threat to cause a contamination or nuisance on the Property or any adjacent property or a hazard to the environment or to the health or safety of persons on the Property.

          “Indemnified Party” means each of the following persons and entities: (a) Lender or any subsequent holder of the Note; (b) Trustee; (c) any persons or entities owned or controlled by, owning or controlling, or under common control or affiliated with, Lender, any subsequent holder of the Note, and/or Trustee; (d) any participants and co-lenders in the Loan; (e) the directors, officers, partners, employees, attorneys and agents of each of the foregoing persons and entities; and (f) the heirs, personal representatives, successors and assigns of each of the foregoing persons and entities.

          “Loan Documents” has the meaning ascribed to such term in the Deed of Trust.

          “Obligor” means any individual Borrower or Indemnitor and “Obligors” means some or all of the persons and entities comprising Borrower and/or Indemnitor, collectively.

          “On” or “on”, when used with respect to the Property or any property adjacent to the Property, means “on, in, under, above or about.”

          “Trustee” means the Trustee under the Deed of Trust.

     2. Representations and Warranties. Each Obligor hereby represents and warrants to, and covenants with, Lender, that, except as disclosed in that certain Phase 1 Environmental Site Assessment Report provided to Lender in connection with the closing of the Loan, as of the date of recordation of the Deed of Trust:

          (a) During the period of Borrower’s ownership of the Property, the Property has not been used for industrial or manufacturing purposes, for landfill, dumping or other waste disposal activities or operations, for generation, storage, use, sale, treatment, processing, recycling or disposal of any Hazardous Material, for underground or aboveground storage tanks, or for any other use that could give rise to the release of any Hazardous Material on the Property; to the best of Obligors’ knowledge, no such use of the Property occurred at any time prior to the period of Borrower’s ownership of the Property; and to the best of Obligors’ knowledge, no such use on any adjacent property occurred at any time prior to the date hereof;

          (b) To the best of Obligors’ knowledge, there is no Hazardous Material, storage tank (or similar vessel) whether underground or otherwise, sump or well currently on the Property;

          (c) Obligors have received no written notice and have no knowledge of any Environmental Claim or any completed, pending or proposed or threatened investigation or inquiry concerning the presence or release of any Hazardous Material on the Property or any

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adjacent property or concerning whether any condition, use or activity on the Property or any adjacent property is in violation of any existing Environmental Requirement;

          (d) To the best of Obligors’ knowledge, the present conditions, uses and activities of and on the Property do not violate any existing Environmental Requirement and the use of the Property which Borrower (and each tenant and subtenant, if any) makes and intends to make of the Property complies and will comply with all applicable existing Environmental Requirements;

          (e) The Property does not appear on and to the best of Obligors’ knowledge has never been on the National Priorities List, any federal or state “superfund” or “superlien” list, or any other list or database of properties maintained by any local, state or federal agency or department showing properties which are known to contain or which are suspected of containing a Hazardous Material;

          (f) To the best of Obligors’ knowledge, no action has been taken to designate the Property as a hazardous waste property or border zone property or otherwise to restrict the land use of the Property (including through a moratorium on new land uses), nor does any Obligor know of any basis for such designation or other restriction;

          (g) Obligors have never applied for and been denied environmental impairment liability insurance coverage relating to the Property; and

          (h) No Obligor, and to Obligors’ knowledge no tenant or subtenant, has obtained or is required to obtain any permit or authorization to construct, occupy, operate, use or conduct any activity on any of the Property by reason of any existing Environmental Requirement.

     3. Violations. Prior to the Cut-Off Date, Obligors will not cause, commit, permit or allow to continue any violation of any Environmental Requirement (a) by any person or entity, including any Obligor, or (b) by or with respect to the Property or any use of or activity on the Property. In addition, Obligors will not cause, permit or allow to continue the attachment of any environmental lien to the Property. Obligors will not place, install, dispose of or release, or cause, permit, or allow the placing, installation, disposal, spilling, leaking, dumping or release of, any Hazardous Material or storage tank (or similar vessel) on the Property and will keep the Property free of Hazardous Material. Notwithstanding the foregoing provisions of this Section 3, Obligors shall not be in Default under this Section 3 should Obligors store minimal quantities of substances on the Property which technically could be considered Hazardous Material; provided that such substances are of a type and are held only in a quantity normally used in connection with the construction, occupancy or operation of comparable buildings (such as cleaning fluids and supplies normally used in the day-to-day operation of business offices), and such substances are being held, stored and used in compliance with all applicable Environmental Requirements. The indemnity in Section 6 of this Agreement shall always apply to such substances, and it shall be and continue to be the responsibility of Obligors to take all remedial actions required under and in accordance with Section 5 of this Agreement in the event of any unlawful release of any such substance.

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     4. Notice to Lender. Obligors shall promptly deliver to Lender a copy of each report pertaining to the Property or to any Obligor prepared by or on behalf of any Obligor pursuant to any Environmental Requirement. Obligors shall promptly advise Lender in writing of any Environmental Claim or of the discovery of any Hazardous Material on the Property as soon as any Obligor first obtains knowledge thereof, including a full description of the nature and extent of the Environmental Claim and/or Hazardous Material and all relevant circumstances.

     5. Remedial Actions.

          (a) Except as permitted under Section 3 above, if any Hazardous Material is discovered on the Property at any time, prior to the Cut-Off Date, and regardless of the cause, Obligors shall promptly at Obligors’ sole risk and expense and solely under the names of Obligors or any of them: (i) remove, treat, and dispose of the Hazardous Material in compliance with all applicable Environmental Requirements, or if such removal is prohibited by any Environmental Requirement, take whatever action as is required by any Environmental Requirement; and (ii) take such other action as is necessary to have the full use and benefit of the Property as contemplated by the Loan Documents. Obligors at their sole expense shall provide Lender with satisfactory evidence of the actions taken as required in this clause (a). Obligors shall provide to Lender within thirty (30) days of Lender’s request a bond, letter of credit or other financial assurance evidencing to Lender’s satisfaction that all necessary funds are readily available to pay the costs and expenses of the actions required by this clause (a) and to discharge any assessments or liens established against the Property as a result of the presence of the Hazardous Material on the Property.

          (b) All remedial actions shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consultant or consulting environmental engineer, and (ii) in accordance with all Environmental Requirements and all other applicable governmental requirements. The selection of the contractors and consultant or consulting environmental engineer for the remedial actions, the contracts entered into with such parties, any disclosures to or agreements with any public or private agencies or parties relating to the remedial actions and any written plan for the remedial actions (and any changes thereto) shall each, at the option of Lender, be subject to the prior written approval of Lender, which approval shall not be unreasonably withheld, conditioned or delayed. Within fifteen (15) days after completion of such remedial actions, Obligors shall obtain and deliver to Lender an Environmental Assessment of the Property made after such completion which shall confirm to Lender’s satisfaction that all required remedial action as stated above has been taken and successfully completed and that there is no evidence or suspicion of any contamination or risk of contamination on the Property or any adjacent property or of violation of any Environmental Requirement with respect to any such Hazardous Material.

          (c) After the occurrence and during the continuance of a Default, Lender may, but shall never be obligated to, remove or cause the removal of any Hazardous Material from the Property (or if removal is prohibited by any Environmental Requirement, take or cause the taking of such other action as is required by any Environmental Requirement) if Obligors fail to promptly commence such remedial actions following discovery and thereafter diligently prosecute the same to the satisfaction of Lender (without limitation of Lender’s rights to declare a Default under any of the Loan Documents and to exercise all rights and remedies available by

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reason thereof). After the occurrence and during the continuance of a Default, Lender and its designees are hereby granted access to the Property at any time or times, upon reasonable notice (which may be written or oral), and a license which is coupled with an interest and irrevocable, to remove or cause such removal or to take or cause the taking of any such other action.

     6. Indemnity. OBLIGORS HEREBY AGREE TO PROTECT, INDEMNIFY, DEFEND AND HOLD INDEMNIFIED PARTIES AND EACH OF THEM HARMLESS FROM AND AGAINST, AND, IF AND TO THE EXTENT PAID, TO REIMBURSE THEM ON DEMAND FOR, ANY AND ALL ENVIRONMENTAL DAMAGES. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO EACH INDEMNIFIED PARTY WITH RESPECT TO ENVIRONMENTAL DAMAGES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF THE NEGLIGENCE OF SUCH (AND/OR ANY OTHER) INDEMNIFIED PARTY. HOWEVER, SUCH INDEMNITY SHALL NOT APPLY TO (a) A PARTICULAR INDEMNIFIED PARTY TO THE EXTENT THAT THE SUBJECT OF THE INDEMNIFICATION IS CAUSED BY OR ARISES OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THAT PARTICULAR INDEMNIFIED PARTY, OR (b) ENVIRONMENTAL DAMAGES CREATED OR ARISING SOLELY FROM EVENTS OR CONDITIONS FIRST EXISTING AFTER A FORECLOSURE SALE UNDER THE DEED OF TRUST (OR A DEED IN LIEU THEREOF), BUT ONLY IF A PARTY OTHER THAN OBLIGORS OR AN AFFILIATE OF ANY OBLIGOR ACQUIRES TITLE TO THE PROPERTY, PROVIDED THAT ANY SUCH ENVIRONMENTAL DAMAGES DO NOT DIRECTLY OR INDIRECTLY ARISE FROM OR RELATE TO ANY RELEASE OF OR EXPOSURE TO ANY HAZARDOUS MATERIALS (INCLUDING PERSONAL INJURY OR DAMAGE TO PROPERTY), NONCOMPLIANCE WITH ANY ENVIRONMENTAL LAWS, OR REMEDIATION EXISTING PRIOR TO THE EVENT DESCRIBED ABOVE. In any dispute between Obligors and Lender as to whether Obligors are released from liability pursuant to the immediately preceding sentence, Obligors shall bear the burden of proof with respect to whether they have been released from liability. Upon demand by any Indemnified Party, Obligors shall diligently defend any Environmental Claim which affects the Property or which is made or commenced against such Indemnified Party, whether alone or together with Obligors or any other person, all at Obligors’ own cost and expense and by counsel to be approved by such Indemnified Party in the exercise of its reasonable judgment. In the alternative, at any time any Indemnified Party may elect to conduct its own defense through counsel selected by such Indemnified Party and at the cost and expense of Obligors.

     7. Binding Obligations; Survival. The representations, warranties, covenants and agreements in this Agreement shall be binding upon Obligors and their successors, assigns and legal representatives and shall inure to the benefit of Indemnified Parties and each of them; provided, however, that Obligors may not assign this Agreement, or assign or delegate any of their rights or obligations under this Agreement, without the prior written consent of Lender in each instance. The representations, warranties, covenants and agreements in this Agreement shall not terminate on the Cut-Off Date or upon the release, foreclosure or other termination of the Deed of Trust, but will survive the Cut-Off Date, the payment in full of the indebtedness secured by the Deed of Trust, foreclosure of the Deed of Trust or conveyance in lieu of foreclosure, the release or termination of the Deed of Trust and any and all of the other Loan Documents, any investigation by or on behalf of any Indemnified Party, any proceeding under

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any Debtor Relief Law, and any other event whatsoever. Without limiting the generality of the foregoing, the obligations of Obligors to indemnify Indemnified Parties under Section 6 after the Cut-Off Date shall be presumed, unless shown by a preponderance of evidence to the contrary.

     8. Environmental Assessments. If any Indemnified Party shall ever have reason to believe that any Hazardous Material affects the Property, or if any Environmental Claim is made or threatened, or if a Default shall have occurred, or upon the occurrence of the Cut-Off Date if requested by any Indemnified Party, Obligors shall at their expense provide to such Indemnified Party from time to time, in each case within thirty (30) days after request by such Indemnified Party, an Environmental Assessment made after the date of such request. Obligors will cooperate with each consulting firm making any such Environmental Assessment and will supply to the consulting firm, from time to time and promptly on request, all information available to Obligors to facilitate the completion of the Environmental Assessment. If Obligors fail to furnish any Indemnified Party within ten (10) days after such Indemnified Party’s request with a copy of an agreement with an acceptable environmental consulting firm to provide such Environmental Assessment, or if Obligors fail to furnish to any Indemnified Party such Environmental Assessment within thirty (30) days after request by such Indemnified Party, the Indemnified Party may cause any such Environmental Assessment to be made at Obligors’ expense and risk. Indemnified Parties and their designees are hereby granted access to the Property at any time or times, upon reasonable notice (which may be written or oral), and a license which is coupled with an interest and irrevocable, to make or cause to be made such Environmental Assessments. Without limiting the generality of the foregoing, Obligors agree that Indemnified Parties will have all rights, powers and authority to enter and inspect the Property as is granted to the secured lender under applicable law, and that any Indemnified Party will have the right to appoint a receiver to enter and inspect the Property to the extent such authority is provided under applicable law. All reasonable costs and expenses incurred by any Indemnified Party in connection with any Environmental Assessment conducted in accordance with this Section 8 shall be paid by Obligors. Indemnified Parties shall be under no duty to make any Environmental Assessment of the Property, and in no event shall any such Environmental Assessment by any Indemnified Party be or give rise to a representation that any Hazardous Material is or is not present on the Property, or that there has been or shall be compliance with any Environmental Requirement, nor shall Obligors or any other person be entitled to rely on any Environmental Assessment made by or at the request of any Indemnified Party. Indemnified Parties owe no duty of care to protect Obligors or any other person against, or to inform them of, any Hazardous Material or other adverse condition affecting the Property.

     9. Information. The results of all investigations conducted and/or Environmental Assessments prepared by or for any Indemnified Party shall be and at all times remain the property of the Indemnified Party and under no circumstances shall any Indemnified Party have any obligation whatsoever to disclose or otherwise make available to Obligors or any other party such results or any other information obtained by any Indemnified Party in connection with such investigations and reports. Notwithstanding the foregoing, Indemnified Parties hereby reserve the right, and Obligors hereby expressly authorize any Indemnified Party, to make available to any party (including any governmental agency or authority and any prospective bidder at any foreclosure sale of the Property) any and all Environmental Assessments that any Indemnified Party may have with respect to the Property. Obligors consent to Indemnified Parties notifying any party (either as part of a notice of sale or otherwise) of the availability of any or all of the

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Environmental Assessments and the information contained therein. Obligors acknowledge that Indemnified Parties cannot control or otherwise assure the truthfulness or accuracy of the Environmental Assessments, and further acknowledge that the release of the Environmental Assessments, or any information contained therein, to prospective bidders at any foreclosure sale of the Property may have a material and adverse effect upon the amount that a party may bid at such sale. Obligors agree that Indemnified Parties shall have no liability whatsoever as a result of delivering any or all of the Environmental Assessments or any information contained therein to any third party, and Obligors hereby release and forever discharge Indemnified Parties from any and all claims, damages, or causes of action, arising out of, connected with or incidental to the Environmental Assessments or the delivery thereof.

     10. Cross-Default with Loan Documents. Any Default under this Agreement shall constitute a Default under the Loan Documents. In addition, any Default under any of the Loan Documents shall constitute a Default hereunder.

     11. Payable on Demand; Remedies. Any amounts to be paid under this Agreement by Obligors (or any of them) from time to time shall be payable by Obligors within ten (10) business days after demand by Lender or any other Indemnified Party. In addition to any other rights or remedies Lender may have under this Agreement, at law or in equity, upon the occurrence of a Default under this Agreement, Lender may (a) pursue any remedies available to it under applicable law, and/or (b) subject to the terms and conditions of this Agreement, do or cause to be done whatever is necessary to cause the Property to comply with all Environmental Requirements, and the cost thereof shall become immediately due and payable upon demand by Lender, and if not paid when due shall accrue interest at the Default Rate until paid. Without limiting any other rights or remedies of Lender, Obligors acknowledge and agree that Obligors’ failure to comply with the terms of this Agreement shall be a breach of contract such that Lender shall have the remedies provided under applicable law for the recovery of damages and for the enforcement thereof. Lender’s action for the recovery of damages or enforcement of this Agreement shall not constitute an action or constitute a money judgment for a deficiency or a deficiency judgment.

     12. Unsecured Agreement; Not a Loan Document; Cumulative Rights. This Agreement is not secured by the Deed of Trust or any other Loan Document or any collateral whatsoever. This Agreement is not one of the Loan Documents. Obligors and Lender intend for this Agreement to serve as Lender’s written demand and Obligors’ response concerning the environmental condition of the Property. The liability of Obligors or any other person under this Agreement shall not be limited or impaired in any way by any provision in the Loan Documents or applicable law limiting Obligors’ or such other person’s liability or Lender’s recourse or rights to a deficiency judgment, or by any change, extension, release, inaccuracy, breach or failure to perform by any party under the Loan Documents, Obligors’ (and, if applicable, such other person’s) liability hereunder being direct and primary and not as a guarantor or surety. Nothing in this Agreement or in any Loan Document shall limit or impair any rights or remedies of Lender and/or any other Indemnified Party against any Obligor or any other person under any Environmental Requirement or otherwise at law or in equity, including any rights of contribution or indemnification.

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     13. Consideration. Obligors acknowledge that Lender has relied and will rely on the representations, warranties, covenants and agreements herein in closing and funding the Loan and that the execution and delivery of this Agreement is an essential condition but for which Lender would not close or fund the Loan.

     14. No Waiver. No delay or omission by any Indemnified Party to exercise any right under this Agreement shall impair any such right nor shall it be construed to be a waiver thereof. No waiver of any single breach or default under this Agreement shall be deemed a waiver of any other breach or default. Any waiver, consent or approval under this Agreement must be in writing to be effective.

     15. Notices. All notices, requests, consents, demands and other communications required or which any party desires to give hereunder shall be in writing (including, without limitation, telecopy, telegraphic, telex, or cable communication) and shall be deemed sufficiently given or furnished if delivered by personal delivery, by courier, or by registered or certified United States mail, postage prepaid, addressed to the party to whom directed at the addresses specified at the end of this Agreement (unless changed by similar notice in writing given by the particular party whose address is to be changed) or by telegram, telex, or facsimile. Any such notice or communication shall be deemed to have been given either at the time of personal delivery or, in the case of courier or mail, as of the date of first attempted delivery at the address and in the manner provided herein, or, in the case of telegram, telex or facsimile, upon receipt; provided, that service of a notice required by any applicable statute shall be considered complete when the requirements of that statute are met. Notwithstanding the foregoing, no notice of change of address shall be effective except upon actual receipt. This Section 15 shall not be construed in any way to affect or impair any waiver of notice or demand provided in any Loan Document or to require giving of notice or demand to or upon any person in any situation or for any reason.

     16. Invalid Provisions. A determination that any provision of this Agreement is unenforceable or invalid shall not affect the enforceability or validity of any other provision and a determination that the application of any provision of this Agreement to any person or circumstance is illegal or unenforceable shall not affect the enforceability or validity of such provision as it may apply to other persons or circumstances.

     17. Construction. Whenever in this Agreement the singular number is used, the same shall include plural where appropriate, and vice versa; and words of any gender in this Agreement shall include each other gender where appropriate. The headings in this Agreement are for convenience only and shall be disregarded in the interpretation hereof. Reference to “person” or “entity” means firms, associations, partnerships, joint ventures, trusts, limited liability companies, corporations and other legal entities, including public or governmental bodies, agencies or instrumentalities, as well as natural persons. The words “include” and “including” shall be interpreted as if followed by the words “without limitation.”

     18. Joint and Several Liability and Waivers by Obligors.

          (a) Each Obligor agrees that it is jointly and severally liable to Indemnified Parties for the payment of all obligations arising under this Agreement, and that such liability is

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independent of the obligations of the other Obligors. Any Indemnified Party may bring an action against any Obligor, whether or not any action is brought against the other Obligors.

          (b) Each Obligor agrees that any release which may be given by any Indemnified Party to the other Obligors will not release such Obligor from its obligations under this Agreement.

          (c) Each Obligor waives any right to assert against any Indemnified Party any defense, setoff, counterclaim, or claims which such Obligor may have against the other Obligors or any other party liable to Indemnified Parties or any of them for the obligations of Obligors under this Agreement.

          (d) Each Obligor agrees that it is solely responsible for keeping itself informed as to the financial condition of the other Obligors and of all circumstances which bear upon the risk of nonpayment. Each Obligor waives any right it may have to require Indemnified Parties to disclose to such Obligor any information which Indemnified Parties or any of them may now or hereafter acquire concerning the financial condition of the other Obligors.

          (e) Each Obligor waives all rights to notices of acceptance of this Agreement and further waives all rights to notices of default or nonperformance by any other Obligor under this Agreement.

          (f) Each Obligor waives any right of subrogation, reimbursement, indemnification and contribution (contractual, statutory or otherwise), including any claim or right of subrogation under any Debtor Relief Law, which such Obligor may now or hereafter have against any other Obligor or any other person with respect to the obligations incurred under this Agreement. Each Obligor waives any right to enforce any remedy that any Indemnified Party now has or may hereafter have against any other Obligor.

     19. Indemnitor Waivers. Indemnitor waives:

          (a) All statutes of limitations as a defense to any action or proceeding brought against Indemnitor by any Indemnified Party, to the fullest extent permitted by law;

          (b) Any right it may have to require Indemnified Party to proceed against Borrower, proceed against or exhaust any security held from Borrower, or pursue any other remedy in any Indemnified Party’s power to pursue;

          (c) Any defense based on any claim that Indemnitor’s obligations exceed or are more burdensome than those of Borrower;

          (d) Any defense based on: (i) any legal disability of Borrower, (ii) any release, discharge, modification, impairment or limitation of the liability of Borrower to any Indemnified Party from any cause, whether consented to by any Indemnified Party or arising by operation of law or from any bankruptcy or other voluntary or involuntary proceeding, in or out of court, for the adjustment of debtor-creditor relationships (“Insolvency Proceeding”) and (iii) any rejection or disaffirmance of the Loan, or any part of it, or any security held for it, in any such Insolvency Proceeding;

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          (e) Any defense based on any action taken or omitted by any Indemnified Party in any Insolvency Proceeding involving Borrower, including any election to have any Indemnified Party’s claim allowed as being secured, partially secured or unsecured, any extension of credit by any Indemnified Party to Borrower in any Insolvency Proceeding, and the taking and holding by any Indemnified Party of any security for any such extension of credit;

          (f) All presentments, demands for performance, notices of nonperformance, protests, notices of protest, notices of dishonor, notices of acceptance of this Agreement and of the existence, creation, or incurring of new or additional indebtedness, and demands and notices of every kind; and

          (g) Any defense based on or arising out of any defense that Borrower may have to the payment or performance of the Loan or any part of it.

     20. Waivers of Subrogation and Other Rights.

          (a) Upon a default by Borrower, Lender in its sole discretion, without prior notice to or consent of Indemnitor, may elect to: (i) foreclose either judicially or nonjudicially against any real or personal property security it may hold for the Loan, (ii) accept a transfer of any such security in lieu of foreclosure, (iii) compromise or adjust the Loan or any part of it or make any other accommodation with Borrower or Indemnitor, or (iv) exercise any other remedy against Borrower or any security. No such action by Lender shall release or limit the liability of Indemnitor, each of whom shall remain liable under this Agreement after the action, even if the effect of the action is to deprive Indemnitor of any subrogation rights, rights of indemnity, or other rights to collect reimbursement from Borrower for any sums paid to any Indemnified Party, whether contractual or arising by operation of law or otherwise. Indemnitor expressly agrees that under no circumstances shall it be deemed to have any right, title, interest or claim in or to any real or personal property to be held by any Indemnified Party or any third party after any foreclosure or transfer in lieu of foreclosure of any security for the Loan.

          (b) Regardless of whether Indemnitor may have made any payments to any Indemnified Party, Indemnitor forever waives: (i) all rights of subrogation, all rights of indemnity, and any other rights to collect reimbursement from Borrower for any sums paid to any Indemnified Party, whether contractual or arising by operation of law (including the United States Bankruptcy Code or any successor or similar statute) or otherwise, (ii) all rights to enforce any remedy that any Indemnified Party may have against Borrower, and (iii) all rights to participate in any security now or later to be held by any Indemnified Party for the Loan.

          (c) Indemnitor understands and acknowledges that if Lender forecloses judicially or nonjudicially against any real property security for the Loan, that foreclosure could impair or destroy any ability that Indemnitor may have to seek reimbursement, contribution or indemnification from Borrower or others based on any right Indemnitor may have of subrogation, reimbursement, contribution or indemnification for any amounts paid by Indemnitor under this Indemnity. Indemnitor further understands and acknowledges that in the absence of the provisions of this Indemnity, such potential impairment or destruction of Indemnitor’s rights, if any, may entitle Indemnitor to assert a defense to this Indemnity. By executing this Agreement, Indemnitor freely, irrevocably and unconditionally: (i) waives and relinquishes that

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defense and agrees that Indemnitor will be fully liable under this Agreement even though Lender may foreclose judicially or nonjudicially against any real property security for the Loan; (ii) agrees that Indemnitor will not assert that defense in any action or proceeding which any Indemnified Party may commence to enforce this Agreement; (iii) acknowledges and agrees that the rights and defenses waived by Indemnitor under this Agreement include any right or defense that Indemnitor may have or be entitled to assert; and (iv) acknowledges and agrees that Lender is relying on this waiver in making the Loan, and that this waiver is a material part of the consideration which Lender is receiving for making the Loan.

          (d) Indemnitor waives Indemnitor’s rights of subrogation and reimbursement and any other rights and defenses available to Indemnitor, including, without limitation, (i) any defenses Indemnitor may have to the indemnity obligation by reason of an election of remedies by Lender and (ii) any rights or defenses Indemnitor may have by reason of protection afforded to the Borrower with respect to the obligation so guaranteed pursuant to the antideficiency or other laws of Texas limiting or discharging the Borrower’s indebtedness.

          (e) Indemnitor waives all rights and defenses arising out of an election of remedies by any Indemnified Party, even though that election of remedies, such as a nonjudicial foreclosure with respect to security for a guaranteed obligation, has destroyed any Indemnitor’s rights of subrogation and reimbursement against the Borrower.

          (f) No provision or waiver in this Indemnity shall be construed as limiting the generality of any other waiver contained in this Indemnity.

     21. Additional Waivers. Indemnitor waives all rights and defenses that Indemnitor may have because Borrower’s debt is secured by real property. This means, among other things:

          (a) Lender may collect from Indemnitor without first foreclosing on any real or personal property collateral pledged by Borrower.

          (b) If Lender forecloses on any real property collateral pledged by Borrower:

          (1) The amount of the debt may be reduced only by the price for which that collateral is sold at the foreclosure sale, even if the collateral is worth more than the sale price.

          (2) Lender may collect from Indemnitor even if Lender, by foreclosing on the real property collateral, has destroyed any right Indemnitor may have to collect from Borrower.

This is an unconditional and irrevocable waiver of any rights and defenses Indemnitor may have because Borrower’s debt is secured by real property.

     22. Applicable Law. The laws of the State of Texas and applicable United States federal law shall govern the rights and duties of the parties hereto and the validity, enforcement and interpretation hereof.

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     23. Lender Assigns; Disclosure of Information. Lender may, at any time, sell, transfer, or assign the Loan and any and all servicing rights with respect thereto, or grant participations therein or issue mortgage pass-through certificates or other securities evidencing a beneficial interest in a rated or unrated public offering or private placement. In the event of any such sale, transfer or assignment of the Loan or any part thereof, the rights and benefits under this Agreement may be transferred therewith to the extent applicable to the Loan or part thereof being sold, transferred or assigned. Obligors waive notice of any sale, transfer or assignment of the Loan or any part thereof, and agree that failure to give notice of any such sale, transfer or assignment will not affect the liabilities of Obligors hereunder. Lender is hereby authorized to disseminate any information it now has or hereafter obtains pertaining to the Property or this Agreement, including credit and/or other information on Obligors and/or any party liable, directly or indirectly, for any part of the obligations under this Agreement, to any actual or prospective assignee or participant with respect to the Loan, to any of Lender’s affiliates, to any regulatory body having jurisdiction over Lender, and to any other parties as necessary or appropriate in Lender’s reasonable judgment.

     24. Execution; Modification. This Agreement may be executed in any number of identical counterparts, each of which shall be deemed an original for all purposes and all of which constitute, collectively, one agreement. This Agreement may be amended only by an instrument in writing intended for that purpose executed jointly by an authorized representative of each party hereto.

     25. WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW, OBLIGORS AND LENDER HEREBY WAIVE TRIAL BY JURY IN RESPECT OF ANY “CLAIM” AS DEFINED IN SECTION 1. THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE BY OBLIGORS AND LENDER, AND OBLIGORS AND LENDER HEREBY REPRESENT THAT NO REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY PERSON OR ENTITY TO INDUCE THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS EFFECT. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES ENTERING INTO THIS AGREEMENT. OBLIGORS AND LENDER ARE EACH HEREBY AUTHORIZED TO FILE A COPY OF THIS SECTION 25 IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER OF JURY TRIAL. EACH OBLIGOR FURTHER REPRESENTS AND WARRANTS THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED BY INDEPENDENT LEGAL COUNSEL SELECTED OF ITS OWN FREE WILL, AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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     THIS AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

     EXECUTED and DELIVERED as of the day and year first written above.

BORROWER:	NNN WESTERN PLACE, LLC, a Delaware limited liability company
The address of Borrower is:
NNN Western Place, LLC	By:	NNN Western Place Manager, LLC, a
NNN Western Place 1, LLC		Delaware limited liability company, its
NNN Western Place 2, LLC		Manager
NNN Western Place 3, LLC
NNN Western Place 4, LLC	By:	Grubb & Ellis Realty Investors, LLC, a
NNN Western Place 5, LLC		Virginia limited liability company, its
NNN Western Place 6, LLC		Manager
NNN Western Place 7, LLC
GREIT — Western Place, LP	By:	/s/ Jeffrey T. Hanson
c/o Grubb & Ellis Realty		Name: Jeffrey T. Hanson
Investors, LLC		Title: Chief Investment Officer
1551 N. Tustin Avenue, Suite 300
Santa Ana, California 92705
Attn: Scott Peters

NNN WESTERN PLACE 1, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia
	limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

S-1

NNN WESTERN PLACE 2, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia
	limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

NNN WESTERN PLACE 3, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia
	limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

NNN WESTERN PLACE 4, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia
	limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

NNN WESTERN PLACE 5, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia
	limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

S-2

NNN WESTERN PLACE 6, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia
	limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

NNN WESTERN PLACE 7, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia
	limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

GREIT — WESTERN PLACE, LP, a Texas limited partnership
By:	GREIT — Western Place GP, LLC, a Delaware
	limited liability company, its General Partner
By:	G REIT Liquidating Trust dated
	January 22, 2008, a Maryland Trust,
	its Sole Member and Manager
By:	Gary H. Hunt, W. Brand Inlow,
	Edward A. Johnson, D. Fleet
	Wallace, and Gary T. Wescombe, as Trustees of the G REIT Liquidating Trust dated January 22, 2008
By:	/s/ Andrea R. Biller
	Name:	Andrea R. Biller
	Title:	Authorized Representative

S-3

INDEMNITOR:	G REIT LIQUIDATING TRUST DATED JANUARY 22, 2008, a Maryland Trust
The addresses of Indemnitor are:
	By:	Gary H. Hunt, W. Brand Inlow,
G REIT LIQUIDATING TRUST		Edward A. Johnson, D. Fleet
NNN REALTY ADVISORS, INC.		Wallace, and Gary T. Wescombe, as
c/o Grubb & Ellis Realty Investors, LLC		Trustees of the G REIT Liquidating
1551 N. Tustin Avenue, Suite 300		Trust dated January 22, 2008
Santa Ana, California 92705
Attn: Andrea Biller	By:	/s/ Andrea R. Biller
		Name: Andrea R. Biller Title: Authorized Representative

NNN REALTY ADVISORS, INC., a Delaware corporation
By:	/s/ Francene LaPoint
	Name:	Francene LaPoint
	Title:	Chief Financial Officer

The address for providing notices to
Lender is:

Wachovia Financial Services, Inc.
Real Estate Financial Services
General Banking Group
Mail Code: CA 6233
15750 Alton Parkway
Irvine, California 92618
Attn: Anne McNeil

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EX-10.26

EXHIBIT 10.26

(Local Currency—Single Jurisdiction)

International Swap Dealers Association, Inc.

MASTER AGREEMENT

dated as of January 8, 2007

WACHOVIA BANK, NATIONAL ASSOCIATION and NNN Western Place, LLC, NNN Western Place 1, LLC, NNN Western Place 2, LLC, NNN Western Place 3, LLC, NNN Western Place 4, LLC, NNN Western Place 5, LLC, NNN Western Place 6, LLC, NNN Western Place 7, LLC, and GREIT-WESTERN PLACE, LP (jointly and severally)

have entered and/or anticipate entering into one or more transactions (each a “Transaction”) that are or will be governed by this Master Agreement, which includes the schedule (the “Schedule”), and the documents and other confirming evidence (each a “Confirmation”) exchanged between the parties confirming those Transactions.

Accordingly, the parties agree as follows: —

1. Interpretation

(a) Definitions. The terms defined in Section 12 and in the Schedule will have the meanings therein specified for the purpose of this Master Agreement.

(b) Inconsistency. In the event of any inconsistency between the provisions of the Schedule and the other provisions of this Master Agreement, the Schedule will prevail. In the event of any inconsistency between the provisions of any Confirmation and this Master Agreement (including the Schedule), such Confirmation will prevail for the purpose of the relevant Transaction.

(c) Single Agreement. All Transactions are entered into in reliance on the fact that this Master Agreement and all Confirmations form a single agreement between the parties (collectively referred to as this “Agreement”), and the parties would not otherwise enter into any Transactions.

2. Obligations

(a) General Conditions.

(i) Each party will make each payment or delivery specified in each Confirmation to be made by it, subject to the other provisions of this Agreement.

(ii) Payments under this Agreement will be made on the due date for value on that date in the place of the account specified in the relevant Confirmation or otherwise pursuant to this Agreement, in freely transferable funds and in the manner customary for payments in the required currency. Where settlement is by delivery (that is, other than by payment), such delivery will be made for receipt on the due date in the manner customary for the relevant obligation unless otherwise specified in the relevant Confirmation or elsewhere in this Agreement.

(iii) Each obligation of each party under Section 2(a)(i) is subject to (1) the condition precedent that no Event of Default or Potential Event of Default with respect to the other party has occurred and is continuing, (2) the condition precedent that no Early Termination Date in respect of the relevant Transaction has occurred or been effectively designated and (3) each other applicable condition precedent specified in this Agreement.

(b) Change of Account. Either party may change its account for receiving a payment or delivery by giving notice to the other party at least five Local Business Days prior to the scheduled date for the payment or delivery to which such change applies unless such other party gives timely notice of a reasonable objection to such change.

(c) Netting. If on any date amounts would otherwise be payable: —

(i) in the same currency; and

(ii) in respect of the same Transaction,

by each party to the other, then, on such date, each party’s obligation to make payment of any such amount will be automatically satisfied and discharged and, if the aggregate amount that would otherwise have been payable by one party exceeds the aggregate amount that would otherwise have been payable by the other party, replaced by an obligation upon the party by whom the larger aggregate amount would have been payable to pay to the other party the excess of the larger aggregate amount over the smaller aggregate amount.

The parties may elect in respect of two or more Transactions that a net amount will be determined in respect of all amounts payable on the same date in the same currency in respect of such Transactions, regardless of whether such amounts are payable in respect of the same Transaction. The election may be made in the Schedule or a Confirmation by specifying that subparagraph (ii) above will not apply to the Transactions identified as being subject to the election, together with the starting date (in which case subparagraph (ii) above will not, or will cease to, apply to such Transactions from such date). This election may be made separately for different groups of Transactions and will apply separately to each pairing of branches or offices through which the parties make and receive payments or deliveries.

(d) Default Interest; Other Amounts. Prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party that defaults in the performance of any payment obligation will, to the extent permitted by law and subject to Section 6(c), be required to pay interest (before as well as after judgment) on the overdue amount to the other party on demand in the same currency as such overdue amount, for the period from (and including) the original due date for payment to (but excluding) the date of actual payment, at the Default Rate. Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed. If, prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party defaults in the performance of any obligation required to be settled by delivery, it will compensate the other party on demand if and to the extent provided for in the relevant Confirmation or elsewhere in this Agreement.

3. Representations

Each party represents to the other party (which representations will be deemed to be repeated by each party on each date on which a Transaction is entered into) that:—

(a) Basic Representations.

(i) Status. It is duly organised and validly existing under the laws of the jurisdiction of its organisation or incorporation and, if relevant under such laws, in good standing;

(ii) Powers. It has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to this Agreement that it is required by this Agreement to deliver and to perform its obligations under this Agreement and any obligations it has under any Credit Support Document to which it is a party and has taken all necessary action to authorise such execution, delivery and performance;

(iii) No Violation or Conflict. Such execution, delivery and performance do not violate or conflict with any law applicable to it, any provision of its constitutional documents, any order or judgment of any court or other agency of government applicable to it or any of its assets or any contractual restriction binding on or affecting it or any of its assets;

(iv) Consents. All governmental and other consents that are required to have been obtained by it with respect to this Agreement or any Credit Support Document to which it is a party have been obtained and are in full force and effect and all conditions of any such consents have been complied with; and

(v) Obligations Binding. Its obligations under this Agreement and any Credit Support Document to which it is a party constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganisation, insolvency, moratorium or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity or at law)).

(b) Absence of Certain Events. No Event of Default or Potential Event of Default or, to its knowledge, Termination Event with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement or any Credit Support Document to which it is a party.

(c) Absence of Litigation. There is not pending or, to its knowledge, threatened against it or any of its Affiliates any action, suit or proceeding at law or in equity or before any court, tribunal, governmental body, agency or official or any arbitrator that is likely to affect the legality, validity or enforceability against it of this Agreement or any Credit Support Document to which it is a party or its ability to perform its obligations under this Agreement or such Credit Support Document.

(d) Accuracy of Specified information. All applicable information that is furnished in writing by or on behalf of it to the other party and is identified for the purpose of this Section 3(d) in the Schedule is, as of the date of the information, true, accurate and complete in every material respect.

4. Agreements

Each party agrees with the other that, so long as either party has or may have any obligation under this Agreement or under any Credit Support Document to which it is a party:—

(a) Furnish Specified Information. It will deliver to the other party any forms, documents or certificates specified in the Schedule or any Confirmation by the date specified in the Schedule or such Confirmation or, if none is specified, as soon as reasonably practicable.

(b) Maintain Authorisations. It will use all reasonable efforts to maintain in full force and effect all consents of any governmental or other authority that are required to be obtained by it with respect to this Agreement or any Credit Support Document to which it is a party and will use all reasonable efforts to obtain any that may become necessary in the future.

(c) Comply with Laws. It will comply in all material respects with all applicable laws and orders to which it may be subject if failure so to comply would materially impair its ability to perform its obligations under this Agreement or any Credit Support Document to which it is a party.

5. Events of Default and Termination Events

(a) Events of Default. The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any of the following events constitutes an event of default (an “Event of Default”) with respect to such party:—

(i) Failure to Pay or Deliver. Failure by the party to make, when due, any payment under this Agreement or delivery under Section 2(a)(i) or 2(d) required to be made by it if such failure is not remedied on or before the third Local Business Day after notice of such failure is given to the party;

(ii) Breach of Agreement. Failure by the party to comply with or perform any agreement or obligation (other than an obligation to make any payment under this Agreement or delivery under Section 2(a)(i) or 2(d) or to give notice of a Termination Event) to be complied with or performed

by the party in accordance with this Agreement if such failure is not remedied on or before the thirtieth day after notice of such failure is given to the party;

(iii) Credit Support Default.

(1) Failure by the party or any Credit Support Provider of such party to comply with or perform any agreement or obligation to be complied with or performed by it in accordance with any Credit Support Document if such failure is continuing after any applicable grace period has elapsed;

(2) the expiration or termination of such Credit Support Document or the failing or ceasing of such Credit Support Document to be in full force and effect for the purpose of this Agreement (in either case other than in accordance with its terms) prior to the satisfaction of all obligations of such party under each Transaction to which such Credit Support Document relates without the written consent of the other party; or

(3) the party or such Credit Support Provider disaffirms, disclaims, repudiates or rejects, in whole or in part, or challenges the validity of, such Credit Support Document;

(iv) Misrepresentation . A representation made or repeated or deemed to have been made or repeated by the party or any Credit Support Provider of such party in this Agreement or any Credit Support Document proves to have been incorrect or misleading in any material respect when made or repeated or deemed to have been made or repeated;

(v) Default under Specified Transaction. The party, any Credit Support Provider of such party or any applicable Specified Entity of such party (1) defaults under a Specified Transaction and, after giving effect to any applicable notice requirement or grace period, there occurs a liquidation of, an acceleration of obligations under, or an early termination of, that Specified Transaction, (2) defaults, after giving effect to any applicable notice requirement or grace period, in making any payment or delivery due on the last payment, delivery or exchange date of, or any payment on early termination of, a Specified Transaction (or such default continues for at least three Local Business Days if there is no applicable notice requirement or grace period) or (3) disaffirms, disclaims, repudiates or rejects, in whole or in part, a Specified Transaction (or such action is taken by any person or entity appointed or empowered to operate it or act on its behalf);

(vi) Cross Default. If “Cross Default” is specified in the Schedule as applying to the party, the occurrence or existence of (1) a default, event of default or other similar condition or event (however described) in respect of such party, any Credit Support Provider of such party or any applicable Specified Entity of such party under one or more agreements or instruments relating to Specified Indebtedness of any of them (individually or collectively) in an aggregate amount of not less than the applicable Threshold Amount (as specified in the Schedule) which has resulted in such Specified Indebtedness becoming, or becoming capable at such time of being declared, due and payable under such agreements or instruments, before it would otherwise have been due and payable or (2) a default by such party, such Credit Support Provider or such Specified Entity (individually or collectively) in making one or more payments on the due date thereof in an aggregate amount of not less than the applicable Threshold Amount under such agreements or instruments (after giving effect to any applicable notice requirement or grace period);

(vii) Bankruptcy. The party, any Credit Support Provider of such party or any applicable Specified Entity of such party:—

(1) is dissolved (other than pursuant to a consolidation, amalgamation or merger); (2) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (3) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (4) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors’ rights, or a petition is presented for its

winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (A) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (B) is not dismissed, discharged, stayed or restrained in each case within 30 days of the institution or presentation thereof; (5) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (6) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets; (7) has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 30 days thereafter; (8) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (1) to (7) (inclusive); or (9) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts; or

(viii) Merger Without Assumption. The party or any Credit Support Provider of such party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and, at the time of such consolidation, amalgamation, merger or transfer:

(1) the resulting, surviving or transferee entity fails to assume all the obligations of such party or such Credit Support Provider under this Agreement or any Credit Support Document to which it or its predecessor was a party by operation of law or pursuant to an agreement reasonably satisfactory to the other party to this Agreement; or

(2) the benefits of any Credit Support Document fail to extend (without the consent of the other party) to the performance by such resulting, surviving or transferee entity of its obligations under this Agreement.

(b) Termination Events. The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any event specified below constitutes an Illegality if the event is specified in (i) below, and, if specified to be applicable, a Credit Event Upon Merger if the event is specified pursuant to (ii) below or an Additional Termination Event if the event is specified pursuant to (iii) below:—

(i) Illegality. Due to the adoption of, or any change in, any applicable law after the date on which a Transaction is entered into, or due to the promulgation of, or any change in, the interpretation by any court, tribunal or regulatory authority with competent jurisdiction of any applicable law after such date, it becomes unlawful (other than as a result of a breach by the party of Section 4(b)) for such party (which will be the Affected Party):—

(1) to perform any absolute or contingent obligation to make a payment or delivery or to receive a payment or delivery in respect of such Transaction or to comply with any other material provision of this Agreement relating to such Transaction; or

(2) to perform, or for any Credit Support Provider of such party to perform, any contingent or other obligation which the party (or such Credit Support Provider) has under any Credit Support Document relating to such Transaction;

(ii) Credit Event Upon Merger. If “Credit Event Upon Merger” is specified in the Schedule as applying to the party, such party (“X”), any Credit Support Provider of X or any applicable Specified Entity of X consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and such action does not constitute an event described in Section 5(a)(viii) but the creditworthiness of the resulting, surviving or transferee entity is materially weaker than that of X, such Credit Support Provider or such Specified Entity, as the case may be, immediately prior to such action (and, in such event, X or its successor or transferee, as appropriate, will be the Affected Party); or

(iii) Additional Termination Event. If any “Additional Termination Event” is specified in the Schedule or any Confirmation as applying, the occurrence of such event (and, in such event, the Affected Party or Affected Parties shall be as specified for such Additional Termination Event in the Schedule or such Confirmation).

(c) Event of Default and Illegality. If an event or circumstance which would otherwise constitute or give rise to an Event of Default also constitutes an Illegality, it will be treated as an Illegality and will not constitute an Event of Default.

6. Early Termination

(a) Right to Terminate Following Event of Default. If at any time an Event of Default with respect to a party (the “Defaulting Party”) has occurred and is then continuing, the other party (the “Non-defaulting Party”) may, by not more than 20 days notice to the Defaulting Party specifying the relevant Event of Default, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all outstanding Transactions. If, however, “Automatic Early Termination” is specified in the Schedule as applying to a party, then an Early Termination Date in respect of all outstanding Transactions will occur immediately upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the extent analogous thereto, (8), and as of the time immediately preceding the institution of the relevant proceeding or the presentation of the relevant petition upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(4) or, to the extent analogous thereto, (8).

(b) Right to Terminate Following Termination Event.

(i) Notice. If a Termination Event occurs, an Affected Party will, promptly upon becoming aware of it, notify the other party, specifying the nature of that Termination Event and each Affected Transaction and will also give such other information about that Termination Event as the other party may reasonably require.

(ii) Two Affected Parties. If an Illegality under Section 5(b)(i)(1) occurs and there are two Affected Parties, each party will use all reasonable efforts to reach agreement within 30 days after notice thereof is given under Section 6(b)(i) on action to avoid that Termination Event.

(iii) Right to Terminate. If: —

(1) an agreement under Section 6(b)(ii) has not been effected with respect to all Affected Transactions within 30 days after an Affected Party gives notice under Section 6(b)(i); or

(2) an Illegality other than that referred to in Section 6(b)(ii), a Credit Event Upon Merger or an Additional Termination Event occurs,

either party in the case of an Illegality, any Affected Party in the case of an Additional Termination Event if there is more than one Affected Party, or the party which is not the Affected Party in the case of a Credit Event Upon Merger or an Additional Termination Event if there is only one Affected Party may, by not more than 20 days notice to the other party and provided that the relevant Termination Event is then continuing, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all Affected Transactions.

(c) Effect of Designation.

(i) If notice designating an Early Termination Date is given under Section 6(a) or (b), the Early Termination Date will occur on the date so designated, whether or not the relevant Event of Default or Termination Event is then continuing.

(ii) Upon the occurrence or effective designation of an Early Termination Date, no further payments or deliveries under Section 2(a)(i) or 2(d) in respect of the Terminated Transactions will be required to be made, but without prejudice to the other provisions of this Agreement. The amount, if any, payable in respect of an Early Termination Date shall be determined pursuant to Section 6(e).

(d) Calculations.

(i) Statement. On or as soon as reasonably practicable following the occurrence of an Early Termination Date, each party will make the calculations on its part, if any, contemplated by Section 6(e) and will provide to the other party a statement (1) showing, in reasonable detail, such calculations (including all relevant quotations and specifying any amount payable under Section 6(e)) and (2) giving details of the relevant account to which any amount payable to it is to be paid. In the absence of written confirmation from the source of a quotation obtained in determining a Market Quotation, the records of the party obtaining such quotation will be conclusive evidence of the existence and accuracy of such quotation.

(ii) Payment Date. An amount calculated as being due in respect of any Early Termination Date under Section 6(e) will be payable on the day that notice of the amount payable is effective (in the case of an Early Termination Date which is designated or occurs as a result of an Event of Default) and on the day which is two Local Business Days after the day on which notice of the amount payable is effective (in the case of an Early Termination Date which is designated as a result of a Termination Event). Such amount will be paid together with (to the extent permitted under applicable law) interest thereon (before as well as after judgment), from (and including) the relevant Early Termination Date to (but excluding) the date such amount is paid, at the Applicable Rate. Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed.

(e) Payments on Early Termination. If an Early Termination Date occurs, the following provisions shall apply based on the parties’ election in the Schedule of a payment measure, either “Market Quotation” or “Loss”, and a payment method, either the “First Method” or the “Second Method”. If the parties fail to designate a payment measure or payment method in the Schedule, it will be deemed that “Market Quotation” or the “Second Method”, as the case may be, shall apply. The amount, if any, payable in respect of an Early Termination Date and determined pursuant to this Section will be subject to any Set-off.

(i) Events of Default. If the Early Termination Date results from an Event of Default:—

(1) First Method and Market Quotation. If the First Method and Market Quotation apply, the Defaulting Party will pay to the Non-defaulting Party the excess, if a positive number, of

(A) the sum of the Settlement Amount (determined by the Non-defaulting Party) in respect of the Terminated Transactions and the Unpaid Amounts owing to the Non-defaulting Party over

(B) the Unpaid Amounts owing to the Defaulting Party.

(2) First Method and Loss. If the First Method and Loss apply, the Defaulting Party will pay to the Non-defaulting Party, if a positive number, the Non-defaulting Party’s Loss in respect of this Agreement.

(3) Second Method and Market Quotation. If the Second Method and Market Quotation apply, an amount will be payable equal to (A) the sum of the Settlement Amount (determined by the Non-defaulting Party) in respect of the Terminated Transactions and the Unpaid Amounts owing to the Non-defaulting Party less (B) the Unpaid Amounts owing to the Defaulting Party. If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party.

(4) Second Method and Loss. If the Second Method and Loss apply, an amount will be payable equal to the Non-defaulting Party’s Loss in respect of this Agreement. If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative

number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party.

(ii) Termination Events. If the Early Termination Date results from a Termination Event:—

(1) One Affected Party. If there is one Affected Party, the amount payable will be determined in accordance with Section 6(e)(i)(3), if Market Quotation applies, or Section 6(e)(i)(4), if Loss applies, except that, in either case, references to the Defaulting Party and to the Non-defaulting Party will be deemed to be references to the Affected Party and the party which is not the Affected Party, respectively, and, if Loss applies and fewer than all the Transactions are being terminated, Loss shall be calculated in respect of all Terminated Transactions.

(2) Two Affected Parties. If there are two Affected Parties:—

(A) if Market Quotation applies, each party will determine a Settlement Amount in respect of the Terminated Transactions, and an amount will be payable equal to (I) the sum of (a) one-half of the difference between the Settlement Amount of the party with the higher Settlement Amount (“X”) and the Settlement Amount of the party with the lower Settlement Amount (“Y”) and (b) the Unpaid Amounts owing to X less (II) the Unpaid Amounts owing to Y; and

(B) if Loss applies, each party will determine its Loss in respect of this Agreement (or, if fewer than all the Transactions are being terminated, in respect of all Terminated Transactions) and an amount will be payable equal to one-half of the difference between the Loss of the party with the higher Loss (“X”) and the Loss of the party with the lower Loss (“Y”).

If the amount payable is a positive number, Y will pay it to X; if it is a negative number, X will pay the absolute value of that amount to Y.

(iii) Adjustment for Bankruptcy. In circumstances where an Early Termination Date occurs because “Automatic Early Termination” applies in respect of a party, the amount determined under this Section 6(e) will be subject to such adjustments as are appropriate and permitted by law to reflect any payments or deliveries made by one party to the other under this Agreement (and retained by such other party) during the period from the relevant Early Termination Date to the date for payment determined under Section 6(d)(ii).

(iv) Pre -Estimate. The parties agree that if Market Quotation applies an amount recoverable under this Section 6(e) is a reasonable pre-estimate of loss and not a penalty. Such amount is payable for the loss of bargain and the loss of protection against future risks and except as otherwise provided in this Agreement neither party will be entitled to recover any additional damages as a consequence of such losses.

7. Transfer

Neither this Agreement nor any interest or obligation in or under this Agreement may be transferred (whether by way of security or otherwise) by either party without the prior written consent of the other party, except that:—

(a) a party may make such a transfer of this Agreement pursuant to a consolidation amalgamation with, or merger with or into, or transfer of all or substantially all its assets to, another entity (but without prejudice to any other right or remedy under this Agreement); and

(b) a party may make such a transfer of all or any part of its interest in any amount payable to it from a Defaulting Party under Section 6(e).

Any purported transfer that is not in compliance with this Section will be void

8. Miscellaneous

(a) Entire Agreement. This Agreement constitutes the entire agreement and understanding of the parties with respect to its subject matter and supersedes all oral communication and prior writings with respect thereto.

(b) Amendments. No amendment, modification or waiver in respect of this Agreement will be effective unless in writing (including a writing evidenced by a facsimile transmission) and executed by each of the parties or confirmed by an exchange of telexes or electronic messages on an electronic messaging system.

(c) Survival of Obligations. Without prejudice to Sections 2(a)(iii) and 6(c)(ii), the obligations of the parties under this Agreement will survive the termination of any Transaction.

(d) Remedies Cumulative. Except as provided in this Agreement, the rights, powers, remedies and privileges provided in this Agreement are cumulative and not exclusive of any rights, powers, remedies and privileges provided by law.

(e) Counterparts and Confirmations.

(i) This Agreement (and each amendment, modification and waiver in respect of it) may be executed and delivered in counterparts (including by facsimile transmission), each of which will be deemed an original.

(ii) The parties intend that they are legally bound by the terms of each Transaction from the moment they agree to those terms (whether orally or otherwise). A Confirmation shall be entered into as soon as practicable and may be executed and delivered in counterparts (including by facsimile transmission) or be created by an exchange of telexes or by an exchange of electronic messages on an electronic messaging system, which in each case will be sufficient for all purposes to evidence a binding supplement to this Agreement. The parties will specify therein or through another effective means that any such counterpart, telex or electronic message constitutes a Confirmation.

(f) No Waiver of Rights. A failure or delay in exercising any right, power or privilege in respect of this Agreement will not be presumed to operate as a waiver, and a single or partial exercise of any right, power or privilege will not be presumed to preclude any subsequent or further exercise, of that right, power or privilege or the exercise of any other right, power or privilege.

(g) Headings. The headings used in this Agreement are for convenience of reference only and are not to affect the construction of or to be taken into consideration in interpreting this Agreement.

9. Expenses

A Defaulting Party will, on demand, indemnify and hold harmless the other party for and against all reasonable out-of-pocket expenses, including legal fees, incurred by such other party by reason of the enforcement and protection of its rights under this Agreement or any Credit Support Document to which the Defaulting Party is a party or by reason of the early termination of any Transaction, including, but not limited to, costs of collection.

10. Notices

(a) Effectiveness. Any notice or other communication in respect of this Agreement may be given in any manner set forth below (except that a notice or other communication under Section 5 or 6 may not be given by facsimile transmission or electronic messaging system) to the address or number or in accordance with the electronic messaging system details provided (see the Schedule) and will be deemed effective as indicated:—

(i) if in writing and delivered in person or by courier, on the date it is delivered;

(ii) if sent by telex, on the date the recipient’s answerback is received;

(iii) if sent by facsimile transmission, on the date that transmission is received by a responsible employee of the recipient in legible form (it being agreed that the burden of proving receipt will be on the sender and will not be met by a transmission report generated by the sender’s facsimile machine);

(iv) if sent by certified or registered mail (airmail, if overseas) or the equivalent (return receipt requested), on the date that mail is delivered or its delivery is attempted; or

(v) if sent by electronic messaging system, on the date that electronic message is received,

unless the date of that delivery (or attempted delivery) or that receipt, as applicable, is not a Local Business Day or that communication is delivered (or attempted) or received, as applicable, after the close of business on a Local Business Day, in which case that communication shall be deemed given and effective on the first following day that is a Local Business Day.

(b) Change of Addresses. Either party may by notice to the other change the address, telex or facsimile number or electronic messaging system details at which notices or other communications are to be given to it.

11. Governing Law and Jurisdiction

(a) Governing Law. This Agreement will be governed by and construed in accordance with the law specified in the Schedule.

(b) Jurisdiction . With respect to any suit, action or proceedings relating to this Agreement (“Proceedings”), each party irrevocably: —

(i) submits to the jurisdiction of the English courts, if this Agreement is expressed to be governed by English law, or to the non-exclusive jurisdiction of the courts of the State of New York and the United States District Court located in the Borough of Manhattan in New York City, if this Agreement is expressed to be governed by the laws of the State of New York; and

(ii) waives any objection which it may have at any time to the laying of venue of any Proceedings brought in any such court, waives any claim that such Proceedings have been brought in an inconvenient forum and further waives the right to object, with respect to such Proceedings, that such court does not have any jurisdiction over such party.

Nothing in this Agreement precludes either party from bringing Proceedings in any other jurisdiction (outside, if this Agreement is expressed to be governed by English law, the Contracting States, as defined in Section 1(3) of the Civil Jurisdiction and Judgments Act 1982 or any modification, extension or re-enactment thereof for the time being in force) nor will the bringing of Proceedings in any one or more jurisdictions preclude the bringing of Proceedings in any other jurisdiction.

(c) Waiver of Immunities. Each party irrevocably waives, to the fullest extent permitted by applicable law, with respect to itself and its revenues and assets (irrespective of their use or intended use), all immunity on the grounds of sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any court, (iii) relief by way of injunction, order for specific performance or for recovery of property, (iv) attachment of its assets (whether before or after judgment) and (v) execution or enforcement of any judgment to which it or its revenues or assets might otherwise be entitled in any Proceedings in the courts of any jurisdiction and irrevocably agrees, to the extent permitted by applicable law, that it will not claim any such immunity in any Proceedings.

12. Definitions

As used in this Agreement:—

“Additional Termination Event” has the meaning specified in Section 5(b).

“Affected Party” has the meaning specified in Section 5(b).

“Affected Transactions” means (a) with respect to any Termination Event consisting of an Illegality, all Transactions affected by the occurrence of such Termination Event and (b) with respect to any other Termination Event, all Transactions.

“Affiliate” means, subject to the Schedule, in relation to any person, any entity controlled, directly or indirectly, by the person, any entity that controls, directly or indirectly, the person or any entity directly or indirectly under common control with the person. For this purpose, “control” of any entity or person means ownership of a majority of the voting power of the entity or person.

“Applicable Rate” means:—

(a) in respect of obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;

(b) in respect of an obligation to pay an amount under Section 6(e) of either party from and after the date (determined in accordance with Section 6(d)(ii)) on which that amount is payable, the Default Rate;

(c) in respect of all other obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default Rate; and

(d) in all other cases, the Termination Rate.

“consent” includes a consent, approval, action, authorisation, exemption, notice, filing, registration or exchange control consent.

“Credit Event Upon Merger” has the meaning specified in Section 5(b).

“Credit Support Document” means any agreement or instrument that is specified as such in this Agreement.

“Credit Support Provider” has the meaning specified in the Schedule.

“Default Rate” means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the relevant payee (as certified by it) if it were to fund or of funding the relevant amount plus 1 % per annum.

“Defaulting Party” has the meaning specified in Section 6(a).

“Early Termination Date” means the date determined in accordance with Section 6(a) or 6(b)(iii).

“Event of Default” has the meaning specified in Section 5(a) and, if applicable, in the Schedule.

“Illegality” has the meaning specified in Section 5(b).

“law” includes any treaty, law, rule or regulation and “lawful” and “unlawful” will be construed accordingly.

“Local Business Day” means, subject to the Schedule, a day on which commercial banks are open for business (including dealings in foreign exchange and foreign currency deposits) (a) in relation to any obligation under Section 2(a)(i), in the place(s) specified in the relevant Confirmation or, if not so specified, as otherwise agreed by the parties in writing or determined pursuant to provisions contained, or incorporated by reference, in this Agreement, (b) in relation to any other payment, in the place where the relevant account is located, (c) in relation to any notice or other communication, including notice contemplated under Section 5(a)(i), in the city specified in the address for notice provided by the recipient and, in the case of a notice contemplated by Section 2(b), in the place where the relevant new account is to be located and (d) in relation to Section 5(a)(v)(2), in the relevant locations for performance with respect to such Specified Transaction.

“Loss” means, with respect to this Agreement or one or more Terminated Transactions, as the case may be, and a party, an amount that party reasonably determines in good faith to be its total losses and costs (or gain, in which case expressed as a negative number) in connection with this Agreement or that Terminated Transaction or group of Terminated Transactions, as the case may be, including any loss of bargain, cost of funding or, at the election of such party but without duplication, loss or cost incurred as a result of its terminating, liquidating, obtaining or reestablishing any hedge or related trading position ( or any gain

resulting from any of them). Loss includes losses and costs (or gains) in respect of any payment or delivery required to have been made (assuming satisfaction of each applicable condition precedent) on or before the relevant Early Termination Date and not made, except, so as to avoid duplication, if Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does not include a party’s legal fees and out-of-pocket expenses referred to under Section 9. A party will determine its Loss as of the relevant Early Termination Date, or, if that is not reasonably practicable, as of the earliest date thereafter as is reasonably practicable. A party may (but need not) determine its Loss by reference to quotations of relevant rates or prices from one or more leading dealers in the relevant markets.

“Market Quotation” means, with respect to one or more Terminated Transactions and a party making the determination, an amount determined on the basis of quotations from Reference Market-makers. Each quotation will be for an amount, if any, that would be paid to such party (expressed as a negative number) or by such party (expressed as a positive number) in consideration of an agreement between such party (taking into account any existing Credit Support Document with respect to the obligations of such party) and the quoting Reference Market-maker to enter into a transaction (the “Replacement Transaction”) that would have the effect of preserving for such party the economic equivalent of any payment or delivery (whether the underlying obligation was absolute or contingent and assuming the satisfaction of each applicable condition precedent) by the parties under Section 2(a)(i) in respect of such Terminated Transaction or group of Terminated Transactions that would, but for the occurrence of the relevant Early Termination Date, have been required after that date. For this purpose, Unpaid Amounts in respect of the Terminated Transaction or group of Terminated Transactions are to be excluded but, without limitation, any payment or delivery that would, but for the relevant Early Termination Date, have been required (assuming satisfaction of each applicable condition precedent) after that Early Termination Date is to be included. The Replacement Transaction would be subject to such documentation as such party and the Reference Market-maker may, in good faith, agree. The party making the determination (or its agent) will request each Reference Market-maker to provide its quotation to the extent reasonably practicable as of the same day and time (without regard to different time zones) on or as soon as reasonably practicable after the relevant Early Termination Date. The day and time as of which those quotations are to be obtained will be selected in good faith by the party obliged to make a determination under Section 6(e), and, if each party is so obliged, after consultation with the other. If more than three quotations are provided, the Market Quotation will be the arithmetic mean of the quotations, without regard to the quotations having the highest and lowest values. If exactly three such quotations are provided, the Market Quotation will be the quotation remaining after disregarding the highest and lowest quotations. For this purpose, if more than one quotation has the same highest value or lowest value, then one of such quotations shall be disregarded. If fewer than three quotations are provided, it will be deemed that the Market Quotation in respect of such Terminated Transaction or group of Terminated Transactions cannot be determined.

“Non-default Rate” means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the Non-defaulting Party (as certified by it) if it were to fund the relevant amount.

“Non-defaulting Party” has the meaning specified in Section 6(a).

“Potential Event of Default” means any event which, with the giving of notice or the lapse of time or both, would constitute an Event of Default.

“Reference Market-makers” means four leading dealers in the relevant market selected by the party determining a Market Quotation in good faith (a) from among dealers of the highest credit standing which satisfy all the criteria that such party applies generally at the time in deciding whether to offer or to make an extension of credit and (b) to the extent practicable, from among such dealers having an office in the same city.

“Scheduled Payment Date” means a date on which a payment or delivery is to be made under Section 2(a)(i) with respect to a Transaction.

“Set-off” means set-off, offset, combination of accounts, right of retention or withholding or similar right or requirement to which the payer of an amount under Section 6 is entitled or subject (whether arising under

this Agreement, another contract, applicable law or otherwise) that is exercised by, or imposed on, such payer.

“Settlement Amount” means, with respect to a party and any Early Termination Date, the sum of:—

(a) the Market Quotations (whether positive or negative) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation is determined; and

(b) such party’s Loss (whether positive or negative and without reference to any Unpaid Amounts) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation cannot be determined or would not (in the reasonable belief of the party making the determination) produce a commercially reasonable result.

“Specified Entity” has the meaning specified in the Schedule.

“Specified Indebtedness” means, subject to the Schedule, any obligation (whether present or future, contingent or otherwise, as principal or surety or otherwise) in respect of borrowed money.

“Specified Transaction” means, subject to the Schedule, (a) any transaction (including an agreement with respect thereto) now existing or hereafter entered into between one party to this Agreement (or any Credit Support Provider of such party or any applicable Specified Entity of such party) and the other party to this Agreement (or any Credit Support Provider of such other party or any applicable Specified Entity of such other party) which is a rate swap transaction, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap, equity or equity index option, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option or any other similar transaction (including any option with respect to any of these transactions), (b) any combination of these transactions and (c) any other transaction identified as a Specified Transaction in this Agreement or the relevant confirmation.

“Terminated Transactions” means with respect to any Early Termination Date (a) if resulting from a Termination Event, all Affected Transactions and (b) if resulting from an Event of Default, all Transactions (in either case) in effect immediately before the effectiveness of the notice designating that Early Termination Date (or, if “Automatic Early Termination” applies, immediately before that Early Termination Date).

“Termination Event” means an Illegality or, if specified to be applicable, a Credit Event Upon Merger or an Additional Termination Event.

“Termination Rate” means a rate per annum equal to the arithmetic mean of the cost (without proof or evidence of any actual cost) to each party (as certified by such party) if it were to fund or of funding such amounts.

“Unpaid Amounts” owing to any party means, with respect to an Early Termination Date, the aggregate of (a) in respect of all Terminated Transactions, the amounts that became payable (or that would have become payable but for Section 2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early Termination Date and which remain unpaid as at such Early Termination Date and (b) in respect of each Terminated Transaction, for each obligation under Section 2(a)(i) which was (or would have been but for Section 2(a)(iii)) required to be settled by delivery to such party on or prior to such Early Termination Date and which has not been so settled as at such Early Termination Date, an amount equal to the fair market value of that which was (or would have been) required to be delivered as of the originally scheduled date for delivery, in each case together with (to the extent permitted under applicable law) interest, in the currency of such amounts, from (and including) the date such amounts or obligations were or would have been required to have been paid or performed to (but excluding) such Early Termination Date, at the Applicable Rate. Such amounts of interest will be calculated on the basis of daily compounding and the actual number of days elapsed. The fair market value of any obligation referred to in clause (b) above shall be reasonably determined

by the party obliged to make the determination under Section 6(e) or, if each party is so obliged, it shall be the average of the fair market values reasonably determined by both parties.

IN WITNESS WHEREOF the parties have executed this document on the respective dates specified below with effect from the date specified on the first page of this document.

WACHOVIA BANK, NATIONAL ASSOCIATION (Name of Party)			SEE EXHIBIT A
By:	/s/ John Miechkowski		By:
	Name:	John Miechkowski		Name:
	Title:	Director		Title:

RIDER A

NNN WESTERN PLACE, LLC, a Delaware limited liability company
By:	NNN Western Place Manager, LLC, a Delaware limited liability company, its Manager
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Manager
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Office
NNN WESTERN PLACE 1, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 2, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 3, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

NNN WESTERN PLACE 4, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 5, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 6, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 7, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

GREIT — WESTERN PLACE, LP, a Texas limited partnership
By:	GREIT — Western Place GP, LLC, a Delaware limited liability company, its General Partner
By:	G REIT Liquidating Trust dated January 22, 2008, a Maryland Trust, its Sole Member and Manager
By:	Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace, and Gary T. Wescombe, as Trustees of the G REIT Liquidating Trust dated January 22, 2008
By:	/s/ Courtney A. Brower
	Name:	Courtney A. Brower
	Title:	Authorized Representative

SCHEDULE

to the
MASTER AGREEMENT
dated as of January 8, 2008 between
WACHOVIA BANK, NATIONAL ASSOCIATION (“Party A”)
and
NNN WESTERN PLACE, LLC, NNN WESTERN PLACE 1, LLC, NNN WESTERN PLACE 2, LLC, NNN
WESTERN PLACE 3, LLC, NNN WESTERN PLACE 4, LLC, NNN WESTERN PLACE 5, LLC, NNN WESTERN
PLACE 6, LLC, NNN WESTERN PLACE 7, LLC, and GREIT-WESTERN PLACE, LP (jointly and severally “Party
B”)

Part 1. Termination Provisions

(a)	“Specified Entity” means each party’s Affiliates for purposes of Section 5(a)(v).
(b)	“Specified Transaction” has its meaning as defined in Section 12.
(c)	“Cross Default” applies to both parties. With respect to Party B, “Cross Default” is amended by inserting at the end of Section 5(a)(vi): “or (3) any default, event of default or other similar condition or event (however described) under any existing or future agreement or instrument relating to any loan or extension of credit from Party A (or any of its Affiliates) to Party B (whether or not anyone else is a party thereto).”
	“Specified Indebtedness” means any obligation (whether present, future, contingent or otherwise, as principal or surety or otherwise) in respect of borrowed money or relating to the payment or delivery of funds, securities or other property (including, without limitation, collateral), other than indebtedness in respect of any bank deposits received in the ordinary course of business by any foreign branch of a party the repayment of which is prevented, hindered or delayed by any governmental or regulatory action or law unrelated to the financial condition or solvency of such party or that foreign branch.
	“Threshold Amount” means, with respect to Party A, an amount (including its equivalent in another currency) equal to the higher of $10,000,000 or 2% of its stockholders’ equity as reflected on its most recent financial statements or call reports, and with respect to Party B, any amount of Specified Indebtedness.
(d)	“Credit Event Upon Merger” applies to both parties.
(e)	“Automatic Early Termination” does not apply to either party.
(f)	Payments on Early Termination. Except as otherwise provided herein, “Market Quotation” and the “Second Method” apply, provided that with respect to the following types of Transactions, a Market Quotation shall not be determined or included under clause (a) of the definition of Settlement Amount, and instead a “Loss” shall be determined and included under clause (b) of the definition of Settlement Amount with respect to the following types of Transactions: any Transactions which are commodity swaps, commodity options, commodity forwards or any other commodity derivative transactions.
	In the case of any Terminated Transaction that is, or is subject to, any unexercised option, the words “economic equivalent of any payment or delivery” appearing in the definition of “Market Quotation” shall be construed to take into account the economic equivalent of the option.
(g)	“Additional Termination Event” does not apply to either party.

Part 2. Tax Provisions

(a) Tax Representations.

(i) Party A represents at all times hereunder that (A) it is a national banking association organized or formed under the laws of the United States, and (B) it is a United States resident for United States federal income tax purposes.

(ii) Party B represents at all times hereunder that (A) it is organized or formed under the laws of a state within the

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United States, and (B) it is (or, if Party B is disregarded for United States federal income tax purposes, its beneficial owner is) a United States resident for United States federal income tax purposes.

(b) Tax Forms.

(i) Each party agrees to deliver to the other party the tax forms specified below with respect to it at the following times: before the first Payment Date under this Agreement; promptly upon reasonable demand by the other party; and promptly upon learning that any such form previously provided by the party has become obsolete or incorrect.

(A) Tax Forms to be Delivered by Party A:

None specified.

(B) Tax forms to be Delivered by Party B:

(I) If Party B is (or, if Party B is disregarded for United States federal income tax purposes, its beneficial owner is) treated as a corporation for United States federal income tax purposes whose name includes “Incorporated”, “Inc.”, “Corporation”, “P.C.”, “Insurance Company” “Indemnity Company”, “Reinsurance Company”, or “Assurance Company”:

None specified, unless any amount payable to Party B under this Agreement is to be paid to an account outside the United States, in which case the tax form to be delivered by Party B shall be a correct, complete and duly executed U.S. Internal Revenue Service Form W-9 (or successor thereto) that eliminates U.S. federal backup withholding tax on payments to Party B under this Agreement.

(II) In all other cases:

A correct, complete and duly executed U.S. Internal Revenue Service Form W-9 (or successor thereto) that eliminates U.S. federal backup withholding tax on payments to Party B under this Agreement.

(ii) In addition, each party agrees to deliver to the other party, upon reasonable demand by such other party, any other tax form that may be required or reasonably requested in writing in order to allow such other party to make a payment under this Agreement (or under any Credit Support Document) without any deduction or withholding for or on account of any tax imposed by any government or other taxing authority in respect of any such payment (other than a stamp, registration, documentation or similar tax), or with such deduction or withholding at a reduced rate, which form shall be correct, complete and duly executed.

(c)

Withholding Tax Liability. A breach of a representation under paragraph (a) above, or a failure to deliver a required tax form in accordance with paragraph (b) above, by a party hereunder (the “defaulting payee”) may result in a tax liability on the part of the other party (the “payor”), as required by the United States Internal Revenue Code and regulations thereunder, for withholding or backup withholding on any payment by the payor to the defaulting payee under this Agreement (or under any Credit Support Document), including a liability to remit to the U.S. Treasury Department the required amount of withholding and to pay interest and penalties to the U.S. Treasury Department for amounts not withheld.

Accordingly, if any such breach or failure by the defaulting payee results in any such tax liability, then (i) any amount so withheld and remitted to the U.S. Treasury Department shall discharge the payor’s obligation under this Agreement (or under any Credit Support Document) to pay to the defaulting payee the portion of any payment so withheld and remitted (with the payor having no obligation to “gross up” any of its payments for such withheld amounts), and (ii) if any tax liability resulting from the defaulting payee’s breach or failure is assessed directly against the payor in respect of any amounts not withheld, the defaulting payee shall indemnify the payor on demand for the amount of such tax liability (including interest and penalties). However, any such breach or failure by the defaulting payee shall not be an “Event of Default” or a “Potential Event of Default” under this Agreement unless the defaulting payee fails to so indemnify the payor.

Part 3. Documents

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Delivery of Documents.

(i) When it delivers this Agreement, Party B shall also deliver its Closing Documents to Party A in form and substance reasonably satisfactory to Party A. For each Transaction, Party B shall deliver, promptly upon request, a duly executed incumbency certificate for the person(s) executing the Confirmation for that Transaction on behalf of Party B.

(ii) For Party B, “Closing Documents” means an opinion of counsel covering Party B’s Basic Representations under Section 3(a) as they relate to this Agreement, or in lieu thereof, (A) a copy of Party B’s organizational documents, including its operating agreement and any articles or certificate of registration or incorporation, and any amendments thereto, (B) a certified copy of the resolutions of Party B duly adopted by or on behalf of the members of Party B (and separate resolutions of the board of directors of each of Party B’s members that is a corporate entity) authorizing the execution, delivery and performance by Party B of this Agreement and authorizing Party B to enter into Transactions hereunder, and (C) a duly executed incumbency certificate of Party B certifying the name, true signature and authority of each person authorized to execute this Agreement and enter into Transactions for Party B, together with, if this Agreement or any Transaction for Party B is being executed through any of Party B’s members or its manager that is a corporate entity, an incumbency certificate of each such member or manager certifying the name, true signature and authority of each such person.

Part 4. Miscellaneous

(a)	Addresses for Notices. For purposes of Section 10(a) of this Agreement, all notices to a party shall, with respect to any particular Transaction, be sent to its address, telex number or facsimile number specified in the relevant Confirmation (or as specified below if not specified in the relevant Confirmation), provided that any notice under Section 5 or 6 of this Agreement, and any notice under this Agreement not related to a particular Transaction, shall be sent to a party at its address specified below.
	To Party A:
	WACHOVIA BANK, NATIONAL ASSOCIATION 301 South College Street, DC-8 Charlotte, NC 28202-0600
	Attention: Derivatives Documentation Group
	Fax: (704) 383-0575 Phone: (704) 383-8778
	To Party B:
	NNN WESTERN PLACE, LLC et al
	Attention:
	Fax:                                          Phone:

(b)	“Calculation Agent” means Party A.
(c)	“Credit Support Document” means, with respect to Party B, each document (whether now existing or hereafter executed) which by its terms secures, guarantees or otherwise supports Party B’s obligations under this Agreement from time to time, whether or not this Agreement, any Transaction, or any type of Transaction entered into hereunder is specifically referenced or described in any such document.

     “Credit Support Default” is amended by adding at the end of Section 5(a)(iii)(1):

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“, any default, event of default or other similar condition or event (however described) exists under any Credit Support Document, any action is taken to realize upon any collateral provided to secure such party’s obligations hereunder or under any Transaction, or the other party fails at any time to have a valid and perfected first priority security interest in any such collateral;”

(d) “Credit Support Provider” means, with respect to Party B, each party to a Credit Support Document that provides or is obligated to provide security, a guaranty or other credit support for Party B’s obligations under this Agreement.

(e) Governing Law. To the extent not otherwise preempted by U.S. Federal law, this Agreement will be governed by and construed in accordance with the law of the State of New York (without giving effect to any provision of New York law that would cause another jurisdiction’s laws to be applied).

(f) Waiver of Jury Trial. To the extent permitted by applicable law, each party irrevocably waives any and all right to trial by jury in any legal proceeding in connection with this Agreement, any Credit Support Document to which it is a party, or any Transaction.

(g)	Netting of Payments. Section 2(c)(ii) will apply in respect of all Transactions from the date of this Agreement, provided that Section 2(c)(ii) will not apply with respect to any Transactions or group of Transactions for which the parties mutually agree shall be netted operationally.
(h)	“Affiliate” has its meaning as defined in Section 12.

Part 5. Other Provisions

(a) 2006 ISDA Definitions. This Agreement and each Transaction are subject to the 2006 ISDA Definitions published by the International Swaps and Derivatives Association, Inc. (the “2006 ISDA Definitions”) and will be governed by the provisions of the 2006 ISDA Definitions. The provisions of the 2006 ISDA Definitions are incorporated by reference in, and shall form part of, this Agreement and each Confirmation. Any reference to a “Swap Transaction” in the 2006 ISDA Definitions is deemed to be a reference to a “Transaction” for purposes of this Agreement or any Confirmation, and any reference to a “Transaction” in this Agreement or any Confirmation is deemed to be a reference to a “Swap Transaction” for purposes of the 2006 ISDA Definitions. The provisions of this Agreement (exclusive of the 2006 ISDA Definitions) shall prevail in the event of any conflict between such provisions and the 2006 ISDA Definitions.

(b) Scope of Agreement. Any Specified Transaction now existing or hereafter entered into between the parties (whether or not evidenced by a Confirmation) shall constitute a “Transaction” under this Agreement and shall be subject to, governed by, and construed in accordance with the terms of this Agreement, unless the confirming document(s) for that Specified Transaction provide(s) otherwise. For any such Specified Transaction not evidenced by a Confirmation, Section 2(a)(i) of this Agreement is amended to read as follows: “(i) Each party will make each payment or delivery to be made by it under each Transaction, as specified in each Confirmation (or otherwise in accordance with the terms of that Transaction if not evidenced by a Confirmation), subject to the other provisions of this Agreement.” In the event the parties enter into any such Specified Transaction that is a foreign exchange transaction or provides for one or more payments or deliveries to be made in a currency other than U.S. Dollars, (i) this Agreement shall be deemed to incorporate by reference the multicurrency provisions of the 1992 ISDA Master Agreement (Multicurrency-Cross Border) form, including Section 8 thereof, and shall be read and construed in accordance with such provisions, mutatis mutandis, with such modifications deemed made to Sections 6(e) and 12 hereof to incorporate the Termination Currency Equivalent provisions of Sections 6(e) and 14 of such form and with U.S. Dollars being deemed the Termination Currency for such purpose, and (ii) this Agreement and any such Specified Transaction shall be deemed to incorporate by reference the 1998 FX and Currency Option Definitions published by ISDA, EMTA Inc. and The Foreign Exchange Committee, except as otherwise specifically provided herein or in the relevant Confirmation.

(c) Additional Representations. In addition to the representations under Section 3, the following representations will apply:

(i) Relationship Between Parties. Each party will be deemed to represent to the other party on the date on which it enters into a Relevant Agreement that:

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(1)	Non-Reliance. It is acting for its own account, and it has made its own independent decisions to enter into the Relevant Agreement and as to whether the Relevant Agreement is appropriate or proper for it based solely upon its own judgment and upon advice from such advisers as it has deemed necessary. It is not relying on any communication (written or oral) of the other party or any of its affiliates (or its respective representatives) as investment advice or as a recommendation to enter into the Relevant Agreement, it being understood that information and explanations related to the terms and conditions of any Relevant Agreement will not be considered investment advice or a recommendation to enter into the Relevant Agreement. No communication (written or oral) received from the other party or any of its affiliates (or its respective representatives) will be deemed to be an assurance or guarantee as to the expected results of the Relevant Agreement.
(2)	Assessment and Understanding. It is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of the Relevant Agreement based solely upon its own evaluation of the Relevant Agreement (including the present and future results, consequences, risks, and benefits thereof, whether financial, accounting, tax, legal, or otherwise) or that of its own advisers. It is also capable of assuming, and assumes, the risks of the Relevant Agreement. It also understands that the terms under which any Transaction may be terminated early are set forth in this Agreement (or in the relevant Confirmation), and any early termination of a Transaction other than pursuant to such terms is subject to mutual agreement of the parties confirmed in writing, the terms of which may require one party to pay an early termination fee to the other party based upon market conditions prevailing at the time of early termination.
(3)	Status of Parties. The other party is not acting as a fiduciary for or an adviser to it in respect of the Relevant Agreement, and any agency, brokerage, advisory or fiduciary services that the other party (or any of its affiliates) may otherwise provide to the party (or to any of its affiliates) excludes the Relevant Agreement.

“Relevant Agreement” means this Agreement, each Transaction, each Confirmation, any Credit Support Document, or any agreement (including any amendment, modification, transfer or early termination) between the parties relating to this Agreement or to any Transaction, Confirmation or Credit Support Document.

(ii) Eligibility. Each party will be deemed to represent to the other party on the date on which it enters into a Transaction that it is an “eligible contract participant” within the meaning of the Commodity Exchange Act or otherwise qualifies under the CFTC’s Policy Statement Concerning Swap Transactions (July 21, 1989) published in the Federal Register at vol.54, pages 30694-30697.

(iii) ERISA. Each party represents to the other party at all times hereunder that it is not (i) an employee benefit plan as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), or a plan as defined in Section 4975(e)(1) of the Internal Revenue Code of 1986, as amended (the “Code”), subject to Title I of ERISA or Section 4975 of the Code, or a plan as so defined but which is not subject to Title I of ERISA or Section 4975 of the Code but is subject to another law materially similar to Title I of ERISA or Section 4975 of the Code (each of which, an “ERISA Plan”), (ii) a person or entity acting on behalf of an ERISA Plan, or (iii) a person or entity the assets of which constitute assets of an ERISA Plan.

(iv) Authorized Persons. Party B represents, warrants and agrees that: (i) each Authorized Person, acting singly, is authorized from time to time on behalf of and in the name of Party B to negotiate, enter into, amend, transfer and terminate Transactions with Party A on such terms as such Authorized Person may agree; (ii) Party B will be bound by the terms of each Transaction, and any amendment, transfer or termination thereof, as and when that Authorized Person enters into (whether orally by telephone or in writing) any such Transaction for Party B or any agreement with Party A to amend, transfer or terminate any Transaction; and (iii) Party A may rely and act upon any instruction, order, agreement or document purporting to be from an Authorized Person and relating to any proposed or existing Transaction, whether the instruction, order, agreement or document is in writing (signed or unsigned) or is communicated by telephone, facsimile transmission or other electronic means, and once Party A has acted or relied upon it, then that instruction, order, agreement or document may not be rescinded, canceled, terminated, modified or amended without Party A’s prior written consent.

“Authorized Person” means any person whose signature is set forth below Party B’s name on the signature pages hereof and each other person who is a director, officer, partner (or general partner), manager (or general manager), member (or managing member) or any other person holding any office or position in Party B or in any of its partners

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(or general partners), managers (or general managers) or members (or managing members).

(d)	Set-off. Any amount (“Early Termination Amount”) payable to one party (“Payee”) by the other party (“Payer”) under Section 6(e), in circumstances where there is a Defaulting Party or one Affected Party in the case where a Termination Event under Section 5(b)(ii) has occurred, will, at the option of the party (“X”) other than the Defaulting Party or the Affected Party (and without prior notice to the Defaulting Party or the Affected Party), be reduced by means of set off against any amount(s) (“Other Agreement Amount”) payable (whether at such time or in the future or upon the occurrence of a contingency) by the Payee to the Payer or to any Affiliate of the Payer (irrespective of the currency, place of payment or booking office of the obligation) under any other agreement(s) between the Payee and the Payer (or between the Payee and any Affiliate of the Payer) or instrument(s) or undertaking(s) issued or executed by the Payee to, or in the favor of, the Payer or any Affiliate of the Payer (and the Other Agreement Amount will be discharged promptly and in all respects to the extent it is so set-off). X will give notice to the other party of any set-off effected under this paragraph.
	For this purpose, either the Early Termination Amount or the Other Agreement Amount (or the relevant portion of such amounts) may be converted by X into the currency in which the other is denominated at the rate of exchange at which such party would be able, acting in a reasonable manner and in good faith, to purchase the relevant amount of such currency. The term “rate of exchange” includes, without limitation, any premiums and costs of exchange payable in connection with the purchase of or conversion into the relevant currency.
	Nothing in this paragraph shall be effective to create a charge or other security interest. This paragraph shall be without prejudice and in addition to any right of set-off, combination of accounts, lien or other right to which any party is at any time otherwise entitled (whether by operation of law, contract or otherwise).

(e) Change of Account. Any account designated by a party pursuant to Section 2(b) shall be in the same legal and tax jurisdiction as the original account.

(f) Recording of Conversations. Each party (i) consents to the recording of telephone conversations between the trading, marketing and other relevant personnel of the parties or any of their Affiliates in connection with this Agreement or any Transaction or potential Transaction, (ii) agrees to obtain any necessary consent of, and give any necessary notice of such recording to, its relevant personnel and those of its Affiliates and (iii) agrees, to the extent permitted by applicable law, that such recordings may be submitted in evidence in any Proceedings.

(g) Confirmation Procedures. Upon receipt thereof, Party B shall examine the terms of each Confirmation sent by Party A, and unless Party B objects to the terms within three New York business days after receipt of that Confirmation, those terms shall be deemed accepted and correct absent manifest error, in which case that Confirmation will be sufficient to form a binding supplement to this Agreement notwithstanding Section 8(e)(ii) of this Agreement.

(h) Covenants of Financial Agreements.

(i) Party B shall provide Party A at all times hereunder with the same covenant protection as Party B provides Party A (or any of its Affiliates) under Financial Agreements. Therefore, in addition to the Cross Default provisions of this Agreement, and notwithstanding the satisfaction of any obligation or promise to pay money to Party A (or any of its Affiliates) under any Financial Agreement, or the termination or cancellation of any Financial Agreement, Party B hereby agrees to perform, comply with and observe for the benefit of Party A hereunder all affirmative and negative covenants contained in each Financial Agreement applicable to Party B (excluding any obligation or promise to pay money under any Financial Agreement) at any time Party B has any obligation (whether absolute or contingent) under this Agreement.

(ii) For purposes hereof: (A) the affirmative and negative covenants of each Financial Agreement applicable to Party B (together with related definitions and ancillary provisions, but in any event excluding any obligation or promise to pay money under any Financial Agreement) are incorporated (and upon execution of any future Financial Agreement, shall automatically be incorporated) by reference herein (mutatis mutandis); (B) if other lenders or creditors are parties to any Financial Agreement, then references therein to the lenders or creditors shall be deemed references to Party A; and (C) for any such covenant applying only when any loan, other extension of credit,

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obligation or commitment under the Financial Agreement is outstanding, that covenant shall be deemed to apply hereunder at any time Party B has any obligation (whether absolute or contingent) under this Agreement.

(iii) Notwithstanding the foregoing, if the incorporation of any provision by reference from any Financial Agreement would result in the violation by Party B of the terms of that Financial Agreement, or be in violation of any law, rule or regulation (as interpreted by any court of competent jurisdiction), then this Agreement shall not incorporate that provision.

“Financial Agreement” means each existing or future agreement or instrument relating to any loan or extension of credit from Party A (or any of its Affiliates) to Party B (whether or not anyone else is a party thereto), as the same exists when executed and without regard to (i) any termination or cancellation thereof or Party A (or any of its Affiliates) ceasing to be a party thereto (whether as a result of repayment thereof or otherwise), or (ii) unless consented to in writing by Party A (or any of its Affiliates), any amendment, modification, addition, waiver or consent thereto or thereof.

(i) Transfer. Notwithstanding anything contained in Section 7 of this Agreement, if the rights of Party A (or any of its Affiliates) in any loan or extension of credit under any Financial Agreement are sold, assigned or otherwise transferred to any purchaser, assignee or transferee to which Party A (or its relevant Affiliate) may lawfully make such sale, assignment or transfer, then Party A may transfer without recourse its rights and obligations in or under this Agreement (and any Credit Support Document) to any such purchaser, assignee or transferee, provided that Party B is provided with written notice of such transfer and a written acknowledgement of the purchaser, assignee or transferee stating that it has acquired such rights and obligations of Party A and is bound by the terms of this Agreement (and any Credit Support Document) as Party A’s successor hereunder (and thereunder).

(j) Independent Obligations. (i) Although Party B may be entering into one or more Transactions under this Agreement to hedge against the interest expense of, or other risk associated with, an existing or future loan or other financing, this Agreement and each Transaction shall be an independent obligation of Party B separate and apart from any such loan or other financing, and therefore: (A) each party’s obligations under this Agreement or any Transaction shall not be contingent on whether any loan or other financing closes, is outstanding or is repaid, in whole or in part, at any time; (B) subject to paragraph (ii) below, any repayment, acceleration, satisfaction, discharge or release of, and any amendment, modification or waiver with respect to, any loan or other financing, whether in whole or in part, at any time, shall not in any way affect this Agreement, any Transaction or either party’s obligations under this Agreement or any Transaction; (C) payments that become due under this Agreement or any Transaction shall be due whether or not (1) the Notional Amount of any Transaction at any time is different from the principal amount of any loan or other financing, (2) the Termination Date of any Transaction occurs before or after the maturity date of any loan or other financing, or (3) any other terms of any loan or other financing are different from the terms of this Agreement or any Transaction; (D) nothing in this Agreement or in any Confirmation is intended to be, nor shall anything herein or therein be construed as, a prepayment penalty, charge or premium for purposes of any loan or other financing, nor shall any terms of any loan or other financing be deemed a waiver of or otherwise impair any amount due or that may become due under this Agreement or under any Transaction; (E) if Party B at any time receives from Party A (or any of its affiliates) any payoff statement or other written statement regarding any loan or other financing, nothing in such statement shall be deemed to apply to this Agreement or any Transaction except as otherwise expressly provided in that statement and then only to the extent so provided; (F) the terms under which any Transaction may be terminated early are set forth in this Agreement (including any Confirmation of such Transaction), and any early termination of a Transaction other than pursuant to the provisions of this Agreement (including any such Confirmation) is subject to mutual agreement of the parties confirmed in writing, the terms of which may require one party to pay an early termination fee to the other party based upon market conditions prevailing at the time of early termination; and (G) if at any time any existing or future collateral or other credit support secures or otherwise supports both this Agreement (or any Transaction hereunder) and any loan or other financing (whether this Agreement or any Transaction hereunder is specifically identified in the collateral or credit support documents, or instead is referred to therein generically), then Party A (or its agent) shall be entitled to continue to hold such collateral or other credit support, and such collateral or other credit support shall continue to secure or otherwise support Party B’s obligations under this Agreement (or any Transaction hereunder), until such time as all such obligations of Party B are completely satisfied notwithstanding any repayment, acceleration, satisfaction, discharge or release of any such loan or other financing.

(ii) Nothing in paragraph (i) above shall be construed as impairing or limiting: any set-off rights; any cross default, credit support default or other provisions contained in this Agreement or any Confirmation to the extent such provisions refer to any repayment or acceleration of any loan or other financing; any rights or obligations under any

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Credit Support Documents; or any obligations of Party B under any covenant incorporated in this Schedule by reference from any loan or other financing (provided that any amendment, modification or waiver executed and delivered by Party A in writing with respect to any such covenant shall be deemed to apply hereunder to that covenant as so incorporated unless otherwise expressly provided in such writing).

(k) Joint Party. If more than one entity or natural person is executing this Agreement as Party B, then (i) the obligations of Party B under this Agreement and under each Transaction shall be the joint and several obligations of each such entity or natural person, (ii) any Event of Default or Potential Event of Default occurring with respect to any such entity or natural person shall be an Event of Default or Potential Event of Default, respectively, with respect to Party B, (iii) the death, release or discharge, in whole or in part, of any such entity or natural person, or the occurrence of any bankruptcy, liquidation, dissolution or any other event described in Section 5(a)(vii) with respect to any such entity or natural person, shall not discharge or affect the liabilities of any other such entity or natural person; (iv) unless the context otherwise requires, each reference in this Agreement or in any Confirmation to “party” shall, as applied to Party B, be construed as a joint and several reference to each such entity or natural person; and (v) any person or entity receiving notices given to Party B at the address shown above shall be deemed to receive such notices on behalf of each such entity or person.

IN WITNESS WHEREOF, the parties have executed this Schedule by their duly authorized signatories as of the date hereof.

WACHOVIA BANK, NATIONAL ASSOCIATION
By:	/s/ John Miechkowski
	Name:	John Miechkowski
	Title:	Director
NNN WESTERN PLACE, LLC, a Delaware limited liability company
By:	NNN Western Place Manager, LLC, a Delaware limited liability company, its Manager
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Manager
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Office
NNN WESTERN PLACE 1, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 2, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

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NNN WESTERN PLACE 3, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 4, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 5, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 6, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 7, LLC, a Delaware limited liability company
By:	Grubb & Ellis Realty Investors, LLC, a Virginia limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

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GREIT — WESTERN PLACE, LP, a Texas limited partnership
By:	GREIT — Western Place GP, LLC, a Delaware limited liability company, its General Partner
By:	G REIT Liquidating Trust dated January 22, 2008, a Maryland Trust, its Sole Member and Manager
By:	Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet Wallace, and Gary T. Wescombe, as Trustees of the G REIT Liquidating Trust dated January 22, 2008
By:	/s/ Courtney A. Brower
	Name:	Courtney A. Brower
	Title:	Authorized Representative

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NOVATION CONFIRMATION

Date:	February 29, 2008
To:	NNN WESTERN PLACE, LLC, NNN WESTERN PLACE 1, LLC, NNN WESTERN PLACE 2, LLC, NNN WESTERN PLACE 3, LLC, NNN WESTERN PLACE 4, LLC, NNN WESTERN PLACE 5, LLC, NNN WESTERN PLACE 6, LLC, NNN WESTERN PLACE 7, LLC, and GREIT-WESTERN PLACE, LP (jointly and severally “Counterparty”)
Email:	cosbrink@1031nnn.com
Attention:	Charles J. Osbrink
To:	Triple Net Properties, LLC
Fax:	cosbrink@1031nnn.com
Attention:	Charles J. Osbrink
From:	Wachovia Bank, N.A. (“Wachovia”)
Ref. No:	2382045

Dear Charles J. Osbrink:

     The purpose of this letter is to confirm a Novation Transaction between the parties on the terms and conditions set forth below effective from the Novation Date. This Novation Confirmation constitutes a Confirmation as referred to in the New Agreement specified below.

     1. The definitions and provisions contained in the 2004 ISDA Novation Definitions (the “Definitions”) and the terms and provisions of the 2006 ISDA Definitions, as published by the International Swaps and Derivatives Association, Inc. and amended from time to time, are incorporated in this Novation Confirmation. In the event of any inconsistency between (i) the Definitions, (ii) the 2006 ISDA Definitions and/or (iii) the Novation Agreement and this Novation Confirmation, this Novation Confirmation will govern.

     2. The terms of the Novation Transaction to which this Novation Confirmation relates, are as follows:

Novation Date:	February 26, 2008
Novated Amount:	USD 24,250,000.00
Transferor:	Triple Net Properties, LLC
Transferee:	NNN WESTERN PLACE, LLC, NNN WESTERN PLACE 1, LLC, NNN WESTERN PLACE 2, LLC, NNN WESTERN PLACE 3, LLC, NNN WESTERN PLACE 4, LLC, NNN WESTERN PLACE 5, LLC, NNN WESTERN PLACE 6, LLC, NNN WESTERN PLACE 7, LLC, and GREIT-WESTERN PLACE, LP (jointly and severally)
Remaining Party:	Wachovia Bank, N.A.
New Agreement (between Transferee and Remaining Party):	ISDA Master Agreement dated as of January 08, 2008 subject to the laws of the State of New York

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     3. The terms of each Old Transaction to which this Novation Confirmation relates, for identification purposes are as follows.

Trade Date of Old Transaction:	January 08, 2008
Effective Date of Old Transaction:	February 08, 2008
Termination Date of Old Transaction:	February 08, 2009
Wachovia Reference Number of Old Transaction:	2350629

     4. The terms of each New Transaction to which this Novation Confirmation relates shall be as specified in the New Confirmation attached hereto as Exhibit A. Remaining Party and Transferee hereby acknowledge that the terms of the New Transaction reflect an amendment agreed between them to the terms of the Old Transaction as novated hereunder.

Full First Calculation Period: Applicable, commencing on February 26, 2008

5. Other Provisions:	None
6. Miscellaneous Provisions:	None
7. Notice Details:	As specified in the New Confirmation attached hereto as Exhibit A.

     8. The parties confirm their acceptance to be bound by this Novation Confirmation as of the Novation Date by executing a copy of this Novation Confirmation and returning it to us. The Transferor, by its execution of a copy of this Novation Confirmation, agrees to the terms of the Novation Confirmation as it relates to each Old Transaction. The Transferee, by its execution of a copy of this Novation Confirmation, agrees to the terms of the Novation Confirmation as it relates to each New Transaction.

Wachovia Bank, N.A.			NNN WESTERN PLACE, LLC, a Delaware limited liability company
By:	/s/ Tracey Bissell
	Name: Title:	Tracey Bissell Vice President	By:  NNN Western Place Manager, LLC, a         Delaware limited liability company, its         Manager

By:  Grubb & Ellis Realty Investors, LLC, a         Virginia limited liability company, its Manager
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Office
NNN WESTERN PLACE 1, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

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NNN WESTERN PLACE 2, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 3, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 4, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 5, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
NNN WESTERN PLACE 6, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

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NNN WESTERN PLACE 7, LLC, a Delaware limited liability company By:  Grubb & Ellis Realty Investors, LLC, a Virginia         limited liability company, its Vice President
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer
GREIT — WESTERN PLACE, LP, a Texas limited partnership By:  GREIT — Western Place GP, LLC,         a Delaware limited liability company,         its General Partner By:  G REIT Liquidating Trust dated         January 22, 2008, a Maryland Trust,         its Sole Member and Manager By:  Gary H. Hunt, W. Brand Inlow,         Edward A. Johnson, D. Fleet         Wallace, and Gary T. Wescombe, as Trustees of the G         REIT Liquidating Trust dated January 22, 2008
By:	/s/ Courtney A. Brower
	Name:	Courtney A. Brower
	Title:	Authorized Representative

Ref. No. 2382045

Triple Net Properties, LLC
By:	/s/ Jeffrey T. Hanson
	Name:	Jeffrey T. Hanson
	Title:	Chief Investment Officer

EXHIBIT A

1. The terms of the particular Transaction to which the Confirmation relates are as follows:

Transaction Type:	Interest Rate Swap
Currency for Payments:	U.S. Dollars
Notional Amount:	USD 24,250,000.00
Term:
Trade Date:	February 26, 2008
Effective Date:	February 26, 2008
Termination Date:	February 28, 2009 , subject to adjustment in accordance with the Modified Following Business Day Convention.
Fixed Amounts:

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Fixed Rate Payer:	Counterparty
Payment Dates:	Monthly on the 1st of each month commencing April 01, 2008, through and including the Termination Date
Business Day Convention:	Modified Following
Business Day:	New York
Fixed Rate:	4.56%
Fixed Rate Day Count Fraction:	Actual/360
Floating Amounts:
Floating Rate Payer:	Wachovia
Payment Dates:	Monthly on the 1st of each month commencing April 01, 2008, through and including the Termination Date
Business Day Convention:	Modified Following
Business Day:	New York
Floating Rate for initial Calculation Period:	3.12%
Floating Rate Option:	USD-LIBOR-BBA
Designated Maturity:	1 Month
Spread:	None
Floating Rate Day Count Fraction:	Actual/360
Floating Rate determined:	Two London Banking Days prior to each Reset Date.
Reset Dates:	The first day of each Calculation Period.
Compounding:	Inapplicable
Rounding convention:	5 decimal places per the ISDA Definitions.

2. The additional provisions of this Confirmation are as follows:

Calculation Agent:	Wachovia
Payment Instructions:	Wachovia Bank, N.A.
	CIB Group, ABA 053000219
	Ref: Derivative Desk (Trade No: 2382045)
	Account #: 04659360006116
Wachovia Contacts:	Settlement and/or Rate Resets:
	1-800-249-3865
	1-704-383-8429
	Documentation:
	Tel: (704) 715-7051
	Fax: (704) 383-9139
	Collateral:
	Tel: (704) 383-9529
	Please quote transaction reference number.
Payments to Counterparty:	Per your standing payment instructions or debit authorization if provided to Wachovia, as relevant. If not provided, please contact us in order for payment to be made.
	Phone: 1-800-249-3865 Fax: 1-704-383-8429

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EX-21.1

Exhibit 21.1

Subsidiaries of G REIT Liquidating Trust

G REIT Sutter Square GP, LLC (Delaware)
G REIT Sutter Square, L.P. (California)
G REIT Pacific Place GP, LLC (Delaware)
G REIT Pacific Place LP (Delaware)
G REIT Pax River Office Park, LLC (Delaware)
G REIT Western Place GP, LLC (Delaware)
G REIT Western Place, LP (Texas)
G REIT One Financial Plaza, LLC (Delaware)
G REIT Congress Center Member, LLC (Delaware)
G REIT Congress Center, LLC (Delaware)
G REIT 824 Market Street LLC (Delaware)
G REIT 824 Market Street Manager, LLC (Delaware)
G REIT Bay View Plaza GP, LLC (California)
G REIT Bay View Plaza LP (California)
G REIT Centerpoint Corporate Park, LLC (Washington)
G REIT Eaton Freeway Industrial Park, LLC (Delaware)
G REIT Madrona GP, LLC (Delaware)
G REIT Madrona, LP (Delaware)
G REIT North Belt Corporate GP, LLC (Delaware)
G REIT North Belt Corporate, LP (Texas)
G REIT North Pointe GP, LLC (California)
G REIT North Pointe, LP (California)
G REIT One World Trade Center, LP (California)
G REIT Opus Plaza at Ken Caryl, LLC (Delaware)
G REIT Public Ledger GP, LLC (Delaware)
G REIT Public Ledger Manager, LLC (Delaware)
G REIT Public Ledger, LLC (Pennsylvania)

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF TRUSTEE

I, Gary T. Wescombe, certify that:

1. I have reviewed this annual report on Form 10-K of G REIT Liquidating Trust (the “Liquidating Trust”);

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 and changes in financial condition and cash flows of the Liquidating Trust as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)), and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Liquidating Trust and have:

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

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

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

d) Disclosed in this report any change in the Liquidating Trust’s internal control over financial reporting that occurred during the Liquidating Trust’s most recent fiscal year that has materially affected, or is reasonably likely to materially affect, the Liquidating Trust’s internal control over financial reporting; and

5. This report discloses, based on my most recent evaluation of internal control over financial reporting:

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

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

March 24, 2008	By/s/  Gary T. Wescombe	Chairman of the Trustees
Date	Gary T. Wescombe

EX-32.1

Exhibit 32.1

CERTIFICATION OF TRUSTEE

Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned Trustee of G REIT Liquidating Trust (the “Liquidating Trust”) hereby certifies, to his knowledge, that:

(i) the accompanying Annual Report on Form 10-K of the Liquidating Trust for the fiscal year ended December 31, 2007 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Liquidating Trust.

March 24, 2008	By/s/  Gary T. Wescombe	Chairman of the Trustees
Date	Gary T. Wescombe

The foregoing certification is being furnished with the Liquidating Trust’s Form 10-K for the period ended December 31, 2007 pursuant to 18 U.S.C. Section 1350. It is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and it is not to be incorporated by reference into any filing of the Liquidating Trust, whether made before or after the date hereof, regardless of any general information language in such filing.