MEPT

DURING THE SECOND QUARTER, MEPT SOLD 303 SECOND STREET IN SAN FRANCISCO FOR GROSS PROCEEDS OF $237 MILLION
The two-tower, Class A, 732,000 square-foot office property located in San Francisco’s South Financial District was acquired by MEPT in 2005. Since purchasing the asset, MEPT worked diligently to market space in the building, leasing over 550,000 square feet over the last five years and achieving a 94 percent occupancy rate at the time of sale.

IN JUNE, DAVID KETO JOINED NEWTOWER TRUST COMPANY AS CHIEF OPERATING OFFICER
In his new role, Mr. Keto will work closely with NewTower’s President and CEO, Patrick Mayberry, in the general management of the bank, including business and operations management, organizational and human resource development, investment management, and external relations.

IN MAY, MEPT SOLD TWO OFFICE ASSETS, COLUMBIA CENTER I AND II, IN DETROIT FOR TOTAL GROSS PROCEEDS OF $59 MILLION.
MEPT purchased Columbia Center I and an adjacent parcel of land in 1998. In 2000, MEPT completed construction of Columbia Center II, creating over 616,000 job hours in the local community.

Patriots Plaza signs new government tenant
The government continues to flock to Patriots Plaza in Southwest, having just signed a new 58,143-square-foot lease at the site this week. The 321,502-square-foot building, completed in October, is part of a three-phase, 1 million-square-foot office complex developed and leased by Trammell Crow Co. of D.C…The owner of Patriots Plaza, Multi-Employer Property Trust, has seen gradual leasing success at the complex since its first building, Patriots Plaza I, was completed in 2005…

Columbia deal may be hopeful sign. Sale price highest since 2007; financing rare
The majority owner of the Columbia Center towers in Troy has sold its stake in the complex ...Troy-based Kirco Development Corp., developer of both towers and formerly a minority investor, bought out the majority investor…

San Francisco Office Values Begin to Crystalize
One of the upcoming sales is 303 Second St. (left), a 732,000 square-foot property 90 percent leased through the end of March. This transaction will give the San Francisco office market a benchmark for both building values and capitalization rates… There was plenty of buyer interest in the property, too; it attracted nearly 20 bids. The top seven or eight of the offers were north of $300 a square foot…


	PERFORMANCE \| GROWTH IN VALUE \| QUARTERLY RETURNS BENCHMARK COMPARISONS

Benchmark Comparisons

There are three industry benchmarks used to measure Fund-level performance and property-level performance: the NCREIF Property Index; the NCREIF Open-End Index; and the NCREIF Fund Index - Open End Diversified Core Equity (NFI-ODCE). Out of the three, the NFI-ODCE currently offers the most appropriate benchmark for evaluating MEPT's total performance.

The most widely used real estate benchmark, the NCREIF Property Index (NPI), is composed of approximately 6,290 institutional grade, operating properties valued at over $305 billion. The NPI is designed to measure the performance and return characteristics of a set of core properties on an unleveraged basis. The properties are pooled from different types of funds and single-investor portfolios, all with varying investment strategies. The return data for the NPI can be analyzed by sector and region, as well as subsectors and sub-regions. The return data is also available on a historic basis and can be used for complex analysis. Since the NPI is derived from property level performance, it does not measure the effect of cash, leverage or management fees on returns, nor does it take into consideration differences in property valuation frequency in the Index. When benchmarked against MEPT's property level returns (operating real estate only), the NPI does provide an apples to apples, or real estate to real estate, comparison of performance.

NCREIF has developed a sub-index, the NCREIF Open-End Index (OPI), comprised of only those properties in the NPI owned by open-end funds. MEPT believes that the sub-index offers an even more applicable benchmark than the NPI to measure the performance of MEPT's real estate, since it allows for the comparison of properties that are more frequently valued than those in the NPI as open-end funds have more stringent valuation requirements than privately held and single investor portfolios. The most relevant comparison would be the performance of MEPT's operating real estate portfolio to the performance of the OPI. NewTower, MEPT's Trustee, relies on this benchmark to conduct quarterly attribution analyses.

In 2005, NCREIF released an open-end Fund level index, the NCREIF Fund Index - Open End Diversified Core Equity (NFI-ODCE). Different from the NPI, the NFI-ODCE is comprised of only open-end funds, and excludes all the closed-end and separate account real estate portfolios. The NFI-ODCE index reports on both a historical and current basis the results of 26 open-end, commingled funds pursuing a core investment strategy. Currently, the benchmark includes funds with total market value of $70.2 billion. The index includes property investments at ownership share, cash balances and leverage, allowing it to reflect the fund's actual asset ownership positions and financing strategy. The NFI-ODCE is best suited as a benchmark from MEPT since it specifically covers core funds and the effects of their cash balances and leverage on fund performance. Since open-end funds in the NFI-ODCE have different strategies, the funds may perform well at different times in the real estate/economic cycle. Therefore, it makes sense to look at long-term comparisons of the NFI-ODCE because the performance of the varying fund strategies can be tested throughout all stages of the real estate cycle.

MEPT's long-term returns have consistently outpaced the benchmarks. A dollar invested in MEPT in 1982 at the Fund's inception has significantly outgrown that same investment in the NCREIF Property Index and the NFI-ODCE.

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