Highwoods Properties to Build Triad Centre III in Memphis

RALEIGH, N.C.--(BUSINESS WIRE)--Highwoods Properties, Inc. (NYSE: HIW), the largest owner and operator of suburban office properties in the Southeast, today announced that it will begin development of Triad Centre III, a $29.2 million, 148,000 square foot, seven-story, multi-tenant Class “A” office building with structured parking on Poplar Avenue in Memphis. This building has been designed to be LEED certified and will be the first LEED-certified office building constructed in Memphis. Triad Centre III is being built on the surface parking area adjacent to two of the Company’s buildings on Poplar Avenue which encompass 243,000 square feet and are 93% occupied. It is scheduled to be completed in the fall of 2009.

Apperson Crump & Maxwell, PLC, the oldest continuously operating law firm in Memphis, has contracted to lease 17% of Triad Centre III.

Ed Fritsch, president and chief executive officer of Highwoods, stated “Poplar Avenue in Memphis is the most highly desired office location in the city and we applaud our Memphis team for creating the opportunity to build another Class A property in this in-fill location. This project also exemplifies how Highwoods is maximizing development opportunities in highly occupied submarkets with limited available land. We have designed the building to meet the requirements for LEED certification and we expect to achieve the 'Silver' level once the building is completed."

The Company noted that in the “Poplar Corridor” submarket, Highwoods owns a total of seven buildings, encompassing 705,000 square feet, that are 96.8% occupied.

“Apperson Crump has been a Highwoods customer for over 20 years,” said Tom Buckner, Managing Partner of the firm, “and we look forward to continuing our long-standing relationship with them at this new, state-of-the-art building."

With the addition of this development project, the Company’s development pipeline grows to 2.3 million square feet, representing an investment of $372 million. These developments are expected to generate aggregate stabilized cash returns of 9%.

Certain matters discussed in this press release, such as the expected timing, cost and impact of our development activity, are forward-looking statements within the meaning of the federal securities laws. These statements are distinguished by use of the words "will", "expect", "intends" and words of similar meaning. Although Highwoods believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved.

Factors that could cause actual results to differ materially from Highwoods' current expectations include, among others, the following: the financial condition of our customers could deteriorate; unwaived defaults, if any, under our debt instruments could result in an acceleration of some of our outstanding debt; speculative development by others could result in excessive supply of office properties relative to customer demand; we may not be able to lease or re-lease space quickly or on as favorable terms as old leases; unexpected difficulties in obtaining additional capital to satisfy our future cash needs or unexpected increases in interest rates would increase our debt service costs; and others detailed in the Company’s 2007 Annual Report on Form 10-K and subsequent SEC reports.

About the Company

Highwoods Properties, Inc., a member of the S&P MidCap 400 Index, is a fully integrated, self-administered real estate investment trust (“REIT”) that provides leasing, management, development, construction and other customer-related services for its properties and for third parties. At March 31, 2008, the Company owned or had an interest in 381 in-service office, industrial and retail properties encompassing approximately 34.2 million square feet. Highwoods also owned 616 acres of development land. Highwoods is based in Raleigh, North Carolina, and its properties and development land are located in Florida, Georgia, Iowa, Kansas, Missouri, Mississippi, North Carolina, South Carolina, Tennessee and Virginia. For more information about Highwoods Properties, please visit our Web site at www.highwoods.com.