Tier Reit (TIER) 8-K Results of Operations and Financial Condition

Exhibit 99.1

Supplemental Operating and Financial Data

For the Quarter Ended March 31, 2016

About the Company

TIER REIT, Inc. is a self-managed, Dallas-based real estate investment trust focused on delivering outsized stockholder return through stock price appreciation and dividend growth while offering unparalleled tenant service. TIER REIT’s investment strategy is to acquire, develop, and operate a portfolio of best-in-class properties in select U.S. markets that consistently lead the nation in both population and office-using employment growth. Within these markets, we target TIER1 submarkets, which are primarily urban and amenity-rich locations.

As of March 31, 2016, we owned interests in 33 operating office properties, two non-operating properties, and one development property located in 14 markets throughout the United States with a total of 12.0 million rentable square feet.

Board of Directors	Executive Officers and Senior Management
Richard I. Gilchrist	Scott W. Fordham
Chairman of the Board and Independent Director	Chief Executive Officer, President, and Director
Scott W. Fordham	Dallas E. Lucas
Chief Executive Officer, President, and Director	Chief Financial Officer and Treasurer
Charles G. Dannis	William J. Reister
Independent Director	Chief Investment Officer and Executive Vice President
Thomas M. Herzog	Telisa Webb Schelin
Independent Director	Chief Legal Officer, Executive Vice President, and Secretary
Dennis J. Martin	James E. Sharp
Independent Director	Chief Accounting Officer and Executive Vice President
Steven W. Partridge	R. Heath Johnson
Independent Director	Managing Director - Asset Management
G. Ronald Witten	Dean R. Hook
Independent Director	Senior Vice President - Information Systems
	Anubhav Raj
	Senior Vice President - Capital Markets

Company Information
Corporate Headquarters	Trading Information	Investor inquiries should be directed to:
5950 Sherry Lane, Suite 700	Trading Symbol: TIER	Scott McLaughlin
Dallas, Texas 75225	New York Stock Exchange	Senior Vice President - Investor Relations
		at 972.483.2400 or
		ir@tierreit.com
Website		Research Coverage
www.tierreit.com		Janney Montgomery Scott LLC
		Robert Stevenson
		640.840.3217

Supplemental Operating and Financial Data

For the Quarter Ended March 31, 2016

Table of Contents

Overview and Highlights
Overview	1
Financial Highlights	2-3
Consolidated Balance Sheets	4
Consolidated Statements of Operations	5
Calculation of FFO and FAD	6
Calculation of EBITDA	7
Non Wholly-Owned Entities Financial Summary	8
Same Store Analysis	9
Schedule of Properties Owned	10
Portfolio Analysis	11
Components of Net Asset Value	12
Selected Non-Stabilized Properties	13
Significant Tenants	14
Industry Diversification	15
Leasing
Leasing Activity	16-17
Lease Expirations	18-19
Occupancy Trends	20
Capital Expenditures
Leasing Cost Summary	21
Leasing Cost Trend Analysis	22
Development, Leasing, and Capital Expenditures Summary	23
Other Information
Potential Future Development Sites	24
Summary of Development Activity	25
Properties Under Development	26
Acquisition and Disposition Activities	27
Summary of Financing	28
Principal Payments by Year	29
Definitions of Non-GAAP Financial Measures	30-31

Forward-Looking Statements

This supplemental operating and financial data report contains forward-looking statements within the meaning of the federal securities laws relating to the business and financial outlook of TIER REIT, Inc. that are based on current expectations, estimates, forecasts, and projections and are not guarantees of future performance. Statements contained herein may be impacted by a number of risks and uncertainties, including the company’s ability to rent space on favorable terms, its ability to address debt maturities and fund its capital requirements, its intentions to sell certain properties, its intentions with respect to development activity, the value of its assets, its anticipated capital expenditures, and other matters. Words such as “may,” "will," “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “would,” “could,” “should,” “objectives,” “strategies,” “goals,” and variations of these words and similar expressions are intended to identify forward-looking statements. Actual results may differ materially from those expressed in these forward-looking statements, and you should not place undue reliance on any such statements. A number of important factors could cause actual results to differ materially from the forward-looking statements contained in this document, as well as other factors described in the Risk Factors section of TIER REIT, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2015. Forward-looking statements in this document speak only as of the date on which such statements were made, and we undertake no obligation to update any such statements that may become untrue because of subsequent events.

Overview

For the Quarter Ended March 31, 2016

Highlights and Financial Results

• FFO attributable to common stockholders, excluding certain items, for the first quarter of 2016 was $21.3 million, or $0.45 per diluted share, as compared to $17.4 million, or $0.35 per diluted share, for the first quarter of 2015, an increase of $3.9 million, or $0.10 per diluted share

• FFO attributable to common stockholders for the first quarter of 2016 was $20.2 million, or $0.42 per diluted share, as compared to $16.9 million, or $0.34 per diluted share, for the first quarter of 2015, an increase of $3.3 million, or $0.08 per diluted share

• Same Store GAAP NOI for the first quarter of 2016 was $34.2 million, as compared to $30.5 million for the first quarter of 2015, an increase of $3.6 million, or 11.8%

• Same Store Cash NOI for the first quarter of 2016 was $30.1 million, as compared to $28.7 million for the first quarter of 2015, an increase of $1.4 million, or 4.8%

• Net loss attributable to common stockholders for the first quarter of 2016 was $12.7 million, or $0.27 per diluted share, as compared to $5.9 million, or $0.12 per diluted share, for the first quarter of 2015, an increase in loss of $6.8 million, or $0.15 per diluted share

• Dennis J. Martin joined our board of directors as an independent director on January 1, 2016

Property Results

• Occupancy at March 31, 2016, was 88.9%, a decrease of 80 basis points from December 31, 2015

• 462,000 square feet leased - 271,000 square feet of renewals, 70,000 square feet of expansion space, and 121,000 square feet of new leasing

Real Estate Activities

• Lawson Commons was sold for a contract sale price of $68.4 million, continuing our progress in disposing of non-strategic properties

Capital Market Activities

• Credit facility successfully converted from secured to unsecured as a result of meeting certain financial covenants, releasing 14 properties comprising 5.6 million square feet in real estate previously encumbered

• Increased the maximum capacity of our credit facility from $750.0 million to $860.0 million, adding a $50.0 million term loan and adding $60.0 million of capacity to our revolving line of credit

• Paid off, without penalty, the $55.8 million construction loan secured by Two BriarLake Plaza (scheduled to mature in October 2016) using proceeds from the new $50 million term loan and the sale of Lawson Common, furthering our progress in reducing our leverage and extending our debt maturities

• Authorized distribution of $0.18 per share of common stock for the first quarter of 2016, which was paid on April 8, 2016

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 1

Financial Highlights
(in thousands, except per share data, effective rent data, percentages, and number of properties)
	31-Mar-16			31-Dec-15			30-Sep-15			30-Jun-15			31-Mar-15
Portfolio Summary:
(at our ownership %, unless otherwise noted)
Total operating office properties	33			34			35			31			34
Rentable square feet (100%) (operating properties)	11,535			11,971			12,615			11,946			13,624
Rentable square feet (own %) (operating properties)	10,419			10,855			10,918			10,418			12,487
Occupancy %	88.9		%	89.7		%	89.4		%	89.0		%	88.4		%
Executed % SF leased	89.7		%	89.8		%	90.2		%	89.5		%	89.7		%
Economic % SF leased	84.6		%	84.1		%	83.6		%	82.3		%	82.3		%
Average effective rent/square feet	$	26.62		$	25.69		$	25.50		$	24.94		$	25.95
	Three Months Ended
	31-Mar-16			31-Dec-15			30-Sep-15			30-Jun-15			31-Mar-15
Financial Results:
Revenue	$	68,478		$	67,085		$	69,423		$	70,038		$	75,819
Base rent	$	46,907		$	47,494		$	47,351		$	51,336		$	56,923
Free rent	$	(3,259	)	$	(3,557	)	$	(3,718	)	$	(5,365	)	$	(5,173	)
NOI	$	36,645		$	36,402		$	38,121		$	36,858		$	36,664
Net loss attributable to common stockholders	$	(12,707	)	$	(11,216	)	$	(13,849	)	$	(1,151	)	$	(5,892	)
Diluted loss per common share (1) (2)	$	(0.27	)	$	(0.24	)	$	(0.28	)	$	(0.02	)	$	(0.12	)
FFO attributable to common stockholders	$	20,232		$	17,363		$	18,883		$	(18,051	)	$	16,904
Diluted FFO per common share (1) (2)	$	0.42		$	0.37		$	0.39		$	(0.36	)	$	0.34
FFO attributable to common stockholders, excluding certain items	$	21,341		$	18,017		$	20,737		$	17,181		$	17,444
Diluted FFO, excluding certain items, per common share (2)	$	0.45		$	0.38		$	0.42		$	0.34		$	0.35
FAD attributable to common stockholders	$	8,185		$	7,667		$	3,954		$	(1,176	)	$	1,556
FAD per common share (1) (2)	$	0.17		$	0.16		$	0.08		$	(0.02	)	$	0.03
Normalized EBITDA	$	34,014		$	34,789		$	35,752		$	33,439		$	37,072
Weighted average common shares outstanding - basic (2)	47,390			47,244			48,843			49,893			49,891
Weighted average common shares outstanding - diluted (2)	47,715			47,436			49,034			50,085			50,066
Selected Additional Trend Information:
Renewal % based on square feet	66		%	79		%	69		%	83		%	74		%
Distributions declared on common shares	$	8,594		$	8,576		$	8,539		$	9,011		$	—
Annualized distribution yield (3)	5.4		%	4.9		%	4.9		%	N/A			N/A

(1) In periods of net loss from continuing operations or negative FFO or FAD attributable to common stockholders there are no dilutive securities and diluted earnings (loss) per common share or diluted FFO or FAD per common share is calculated using weighted average common shares outstanding - basic as the denominator.

(2) All periods presented have been adjusted to reflect the one-for-six reverse stock split that occurred on June 2, 2015.

(3) Based on the closing price of our common stock as of the last day of the associated period. Prior to the July 23, 2015, listing of our common stock on the New York Stock Exchange, no stock price is available.

Occupancy % represents the total square footage subject to commenced leases as of the reporting date as a percentage of the total rentable square feet (at our ownership interest).

Executed % SF leased represents the total square footage subject to commenced leases plus the square footage for currently vacant space that is subject to executed leases that have not commenced as of the reporting date as a percentage of the total rentable square feet (at our ownership interest).

Economic % SF leased represents the total square footage subject to commenced leases as of the reporting date adjusted to exclude the square footage associated with leases receiving rental abatements as a percentage of the total rentable square feet (at our ownership interest).

Average effective rent represents 12 times the sum of the monthly contractual amounts for base rent and the pro rata budgeted operating expense reimbursements, as of period end, related to leases in place as of period end, as reduced for free rent and excluding any scheduled future rent increases, as adjusted for our ownership interest.

This section includes non-GAAP financial measures, which are accompanied by what we consider the most directly comparable financial measures calculated and presented in accordance with accounting principles generally accepted in the United States (“GAAP”). Quantitative reconciliations of the differences between the non-GAAP financial measures presented and the most directly comparable GAAP financial measures are shown on pages 6-7. A description of the non-GAAP financial measures we present and a statement of the reasons why management believes the non-GAAP measures provide useful information to investors about the Company’s financial condition and results of operations can be found on pages 30-31.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 2

Financial Highlights (continued)
(in thousands, except percentages and ratios)
	31-Mar-16			31-Dec-15			30-Sep-15			30-Jun-15			31-Mar-15
Selected Balance Sheet Items:
Total book value of real estate (1)	$	1,503,088		$	1,573,248		$	1,590,422		$	1,488,373		$	1,609,953
Cash and cash equivalents	$	5,532		$	12,248		$	7,769		$	153,158		$	5,764
Unconsolidated cash and cash equivalents (at ownership %)	$	4,175		$	4,086		$	6,293		$	3,368		$	2,480
Restricted cash	$	12,756		$	10,712		$	16,615		$	29,620		$	32,761
Total assets	$	1,787,304		$	1,873,745		$	1,906,755		$	1,919,743		$	2,116,165
Mortgage debt (1)	$	358,717		$	415,425		$	463,629		$	505,224		$	903,475
Revolving credit facility and term loans	$	683,000		$	665,000		$	626,000		$	525,000		$	221,000
Mortgage debt classified as held for sale	$	—		$	—		$	—		$	—		$	96,824
Unconsolidated debt (at ownership %)	$	82,747		$	80,189		$	90,909		$	72,392		$	59,870
Total liabilities	$	1,142,948		$	1,195,926		$	1,216,646		$	1,144,786		$	1,338,198
Capitalization:
Common stock outstanding (2)	47,405			47,362			47,242			49,872			49,901
OP units and restricted stock units outstanding (2)	141			29			82			84			86
Restricted stock outstanding (2)	333			282			189			192			192
	47,879			47,673			47,513			50,148			50,179
Closing stock price (3)	$	13.44		$	14.75		$	14.72		N/A			N/A
Market capitalization (3)	$	643,494		$	703,177		$	699,391		$	1,347,978		$	1,348,812
Total debt (4)	$	1,124,464		$	1,160,614		$	1,180,538		$	1,102,616		$	1,281,169
Net debt (5)	$	1,114,757		$	1,144,280		$	1,166,476		$	946,090		$	1,272,925
Total capitalization	$	1,767,958		$	1,863,791		$	1,879,929		$	2,450,594		$	2,629,981
	Three Months Ended
	31-Mar-16			31-Dec-15			30-Sep-15			30-Jun-15			31-Mar-15
Ratios:
NOI margin %	53.5		%	54.3		%	54.9		%	52.6		%	48.4		%
Normalized fixed charge coverage (6)	2.46			2.35			2.35			1.78			1.76
Normalized interest coverage (6)	2.72			2.67			2.68			2.05			2.06
Net debt/normalized annualized estimated full period EBITDA from properties owned at period end (6)	8.40x			8.22x			8.02x			7.75x			8.94x
(1) Excludes book value of real estate and mortgage debt classified as held for sale.
(2) All periods presented have been adjusted to reflect the one-for-six reverse stock split that occurred on June 2, 2015.
(3) Market capitalization is equal to outstanding shares (common stock, restricted stock, OP units, and restricted stock units, as if converted) times the closing price of our common stock as of the the last day of the associated period. Prior to the July 23, 2015, listing of our common stock on the New York Stock Exchange, the price used was the estimated stock value of $26.88 per share, as reported in Quarterly Report on Form 10-Q filed on November 3, 2014, as adjusted to reflect the one-for-six reverse stock split that occurred on June 2, 2015.
(4) Includes book value of mortgage debt, the revolving credit facility and term loans, mortgage debt classified as held for sale, and unconsolidated debt (at ownership %).
(5) Total debt less cash and cash equivalents and unconsolidated cash and cash equivalents (at ownership %).
(6) See page 7 for more detailed information.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 3

Consolidated Balance Sheets
(in thousands, except share and per share data)
		31-Mar-16			31-Dec-15			30-Sep-15			30-Jun-15			31-Mar-15
Assets
	Real estate
	Land	$	176,309		$	179,989		$	184,318		$	167,231		$	249,030
	Land held for development	45,059			45,059			44,834			6,377			—
	Buildings and improvements, net	1,276,519			1,348,200			1,361,270			1,314,765			1,360,923
	Real estate under development	5,201			—			—			—			—
	Total real estate	1,503,088			1,573,248			1,590,422			1,488,373			1,609,953
	Cash and cash equivalents	5,532			12,248			7,769			153,158			5,764
	Restricted cash	12,756			10,712			16,615			29,620			32,761
	Accounts receivable, net	78,562			76,228			74,817			71,877			75,466
	Prepaid expenses and other assets	6,025			6,712			22,875			31,890			7,222
	Investments in unconsolidated entities	90,000			88,998			85,377			44,780			39,422
	Deferred financing fees, net (2)	3,310			3,111			3,308			3,344			3,582
	Acquired above-market leases, net	1,258			1,388			1,518			1,619			163
	Other lease intangibles, net	76,787			82,160			84,351			74,850			77,480
	Other intangible assets, net	9,986			10,086			10,185			10,284			2,114
	Assets associated with real estate held for sale	—			—			—			—			255,130
Total assets		$	1,787,304		$	1,864,891		$	1,897,237		$	1,909,795		$	2,109,057
Liabilities and equity
Liabilities:
	Mortgage debt	$	358,717		$	415,425		$	463,620		$	505,196		$	903,688
	Unsecured term loans	575,000			525,000			525,000			525,000			125,000
	Unsecured revolving credit facility	108,000			140,000			101,000			—			96,000
	Unamortized debt issuance costs (2)	(8,744		)	(8,854		)	(9,518		)	(9,948		)	(7,108		)
	Unamortized mark to market premium (discount)	—			—			9			28			(213		)
	Total notes payable, net	1,032,973			1,071,571			1,080,111			1,020,276			1,117,367
	Accounts payable	834			831			1,477			2,192			1,118
	Payables to related parties	294			292			302			794			2,257
	Accrued liabilities	55,847			70,766			72,719			64,794			65,713
	Acquired below-market leases, net	10,456			11,934			13,321			12,773			14,381
	Other liabilities	33,944			23,082			30,642			24,981			25,797
	Distributions payable	8,600			8,596			8,556			9,028			—
	Obligations associated with real estate held for sale	—			—			—			—			104,457
Total liabilities		1,142,948			1,187,072			1,207,128			1,134,838			1,331,090
Commitments and contingencies
Series A Convertible Preferred Stock		—			2,700			2,700			4,626			4,626
Equity:
	Preferred stock	—			—			—			—			—
	Convertible stock	—			—			—			—			—
	Common stock, $.0001 par value per share, 382,499,000 shares authorized (1)	5			5			5			5			5
	Additional paid-in capital (1)	2,603,564			2,600,193			2,598,333			2,645,825			2,646,147
	Cumulative distributions and net loss attributable to common stockholders	(1,944,022		)	(1,922,721		)	(1,902,927		)	(1,878,611		)	(1,868,447		)
	Accumulated other comprehensive income (loss)	(16,732		)	(3,860		)	(10,148		)	799			(5,336		)
	Stockholders’ equity	642,815			673,617			685,263			768,018			772,369
	Noncontrolling interests	1,541			1,502			2,146			2,313			972
Total equity		644,356			675,119			687,409			770,331			773,341
Total liabilities and equity		$	1,787,304		$	1,864,891		$	1,897,237		$	1,909,795		$	2,109,057
Common stock, number of shares issued and outstanding (1)		47,404,980			47,362,372			47,241,851			49,871,776			49,901,013
(1) All periods have been adjusted to reflect the one-for-six reverse stock split that occurred on June 2, 2015.
(2) All periods have been adjusted to reflect adoption and retrospective application of new accounting guidance regarding presentation of certain debt issuance costs as a deduction from the corresponding debt liability.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 4

	Consolidated Statements of Operations
	(in thousands, except share and per share amounts)
		Three Months Ended
		31-Mar-16			31-Dec-15			30-Sep-15			30-Jun-15			31-Mar-15
Revenue
	Rental income	$	63,291		$	61,736		$	62,794		$	63,953		$	71,604
	Straight-line rent and lease incentive revenue	3,250			3,310			2,547			4,625			2,483
	Above- and below-market rent amortization	1,348			1,256			2,064			1,335			1,187
	Lease termination fees	589			783			2,018			125			545
	Total revenue	68,478			67,085			69,423			70,038			75,819
Expenses
	Property related expenses	20,485			21,812			21,290			20,877			25,179
	Real estate taxes	11,064			8,622			9,670			10,198			11,644
	Property management fees	284			249			342			2,105			2,332
	Total property operating expenses	31,833			30,683			31,302			33,180			39,155
	Interest expense	11,501			11,668			11,884			14,591			15,641
	Amortization of deferred financing costs	739			1,048			914			899			908
	Amortization of mark to market	—			(9		)	(33		)	(30		)	(27		)
	Total interest expense	12,240			12,707			12,765			15,460			16,522
	General and administrative	5,510			5,569			6,378			5,412			5,381
	BHT Advisors termination fee and HPT Management buyout fee	—			—			101			10,200			—
	Tender offer and listing costs	—			(27		)	2,562			2,488			503
	Amortization of restricted shares and units	994			3,371			505			564			535
	Straight-line rent expense adjustment	—			—			(67		)	(7		)	(7		)
	Acquisition expense	—			21			644			813			2
	Asset impairment losses	4,826			—			—			—			132
	Real estate depreciation and amortization	31,770			29,910			31,217			31,081			30,022
	Depreciation and amortization - non-real estate assets	274			272			229			—			—
	Total expenses	87,447			82,506			85,636			99,191			92,245
	Interest and other income	274			257			267			141			145
	Loss on early extinguishment of debt	—			(24		)	(30		)	(21,412		)	(36		)
Loss from continuing operations before income taxes, equity
	in operations of investments, and gain (loss) on sale of assets	(18,695		)	(15,188		)	(15,976		)	(50,424		)	(16,317		)
	Benefit (provision) for income taxes	(182		)	(209		)	(36		)	(1,338		)	76
	Equity in operations of investments	415			3,829			(159		)	69			243
Loss from continuing operations before gain (loss) on sale of assets		(18,462		)	(11,568		)	(16,171		)	(51,693		)	(15,998		)
Discontinued operations:
	Income (loss) from discontinued operations	—			17			21			(121		)	1,490
	Gain on sale of discontinued operations	—			297			403			6,077			8,606
Discontinued operations		—			314			424			5,956			10,096
Gain (loss) on sale of assets		5,739			(2		)	(85		)	44,564			—
Net loss		(12,723		)	(11,256		)	(15,832		)	(1,173		)	(5,902		)
	Noncontrolling interests - continuing operations	16			41			58			33			27
	Noncontrolling interests - discontinued operations	—			(1		)	(1		)	(11		)	(17		)
	Dilution of Series A Convertible Preferred Stock	—			—			1,926			—			—
Net loss attributable to common stockholders		$	(12,707	)	$	(11,216	)	$	(13,849	)	$	(1,151	)	$	(5,892	)
Basic and diluted weighted average common shares outstanding (1)		47,389,591			47,244,471			48,842,711			49,893,330			49,891,436
Basic and diluted earnings (loss) per common share:
	Continuing operations (1)	$	(0.27	)	$	(0.24	)	$	(0.29	)	$	(0.14	)	$	(0.32	)
	Discontinued operations (1)	—			—			0.01			0.12			0.20
Basic and diluted loss per common share (1)		$	(0.27	)	$	(0.24	)	$	(0.28	)	$	(0.02	)	$	(0.12	)
Distributions declared per common share (1)		$	0.18		$	0.18		$	0.18		$	0.18		$	—
Net income (loss) attributable to common stockholders:
	Continuing operations	$	(12,707	)	$	(11,529	)	$	(14,272	)	$	(7,096	)	$	(15,971	)
	Discontinued operations	—			313			423			5,945			10,079
Net loss attributable to common stockholders		$	(12,707	)	$	(11,216	)	$	(13,849	)	$	(1,151	)	$	(5,892	)
(1) All periods presented have been adjusted to reflect the one-for-six reverse stock split that occurred on June 2, 2015.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 5

Calculation of FFO and FAD
(in thousands, except per share data)
		Three Months Ended
Funds from operations (FFO)		31-Mar-16			31-Dec-15			30-Sep-15			30-Jun-15			31-Mar-15
Net loss		$	(12,723	)	$	(11,256	)	$	(15,832	)	$	(1,173	)	$	(5,902	)
Net loss attributable to noncontrolling interests		16			40			57			22			10
Dilution of Series A Convertible Preferred Stock		—			—			1,926			—			—
Adjustments (1):
	Real estate depreciation and amortization - consolidated	31,770			29,910			31,217			31,081			30,022
	Real estate depreciation and amortization - unconsolidated joint ventures	2,045			2,427			1,904			1,367			1,287
	Real estate depreciation and amortization - noncontrolling interest	(6		)	(10		)	(10		)	—			—
	Impairment of depreciable real estate assets	4,826			—			—			—			132
	Gain on sale of depreciable real estate	(5,739		)	(3,698		)	(318		)	(50,641		)	(8,606		)
	Taxes associated with sale of depreciable real estate	64			—			(5		)	1,264			—
	Noncontrolling interests	(21		)	(50		)	(56		)	29			(39		)
FFO attributable to common stockholders		$	20,232		$	17,363		$	18,883		$	(18,051	)	$	16,904
FFO, excluding certain items
FFO attributable to common stockholders		$	20,232		$	17,363		$	18,883		$	(18,051	)	$	16,904
Adjustments (1):
	Acquisition expenses	—			26			642			1,193			2
	Severance charges	493			—			—			—			—
	Tender offer and listing costs	—			(27		)	2,562			2,488			503
	Loss on early extinguishment of debt	—			31			127			21,412			36
	Non-cash default interest (2)	617			625			355			—			—
	BHT Advisors termination fee and HPT Management buyout fee	—			—			101			10,200			—
	Noncontrolling interests	(1		)	(1		)	(7		)	(61		)	(1		)
	Dilution of Series A Convertible Preferred Stock	—			—			(1,926		)	—			—
FFO attributable to common stock holders, excluding certain items		$	21,341		$	18,017		$	20,737		$	17,181		$	17,444
Funds available for distribution (FAD)
FFO attributable to common stock holders		$	20,232		$	17,363		$	18,883		$	(18,051	)	$	16,904
Adjustments (1):
	Recurring capital expenditures	(9,353		)	(11,113		)	(13,795		)	(14,067		)	(13,247		)
	Straight-line rent adjustments	(3,957		)	(2,662		)	(2,525		)	(4,369		)	(2,850		)
	Above- and below-market rent amortization	(1,423		)	(1,330		)	(2,139		)	(1,433		)	(1,289		)
	Amortization of deferred financing fees and mark to market	793			1,095			930			898			936
	Amortization of restricted shares and units	994			3,371			505			564			535
	Acquisition expenses	—			26			642			1,193			2
	Tender offer and listing costs	—			(27		)	2,562			2,488			503
	Loss on early extinguishment of debt	—			31			127			21,412			36
	Default interest	617			625			355			—			—
	BHT Advisors termination fee and HPT Management buyout fee	—			—			101			10,200			—
	Depreciation and amortization - non-real estate assets	274			272			229			—			—
	Noncontrolling interests	8			16			5			(11		)	26
	Dilution of Series A Convertible Preferred Stock	—			—			(1,926		)	—			—
FAD attributable to common stockholders		$	8,185		$	7,667		$	3,954		$	(1,176	)	$	1,556
Weighted average common shares outstanding - basic (3)		47,390			47,244			48,843			49,893			49,891
Weighted average common shares outstanding - diluted (3)		47,715			47,436			49,034			50,085			50,066
Diluted FFO per common share (3) (4)		$	0.42		$	0.37		$	0.39		$	(0.36	)	$	0.34
Diluted FFO, excluding certain items, per common share (3)		$	0.45		$	0.38		$	0.42		$	0.34		$	0.35
Diluted FAD per common share (3) (4)		$	0.17		$	0.16		$	0.08		$	(0.02	)	$	0.03

(1) Adjustments represent our pro rata share of consolidated and unconsolidated amounts, including discontinued operations.

(2) As of March 31, 2016, we had a non-recourse loan in default which subjects us to incur default interest at a rate that is 500 basis points higher than the stated interest rate. Although there can be no assurance, we anticipate that when this property is sold or when ownership of this property is conveyed to the lender, this default interest will be forgiven.

(3) All periods presented have been adjusted to reflect the one-for-six reverse stock split that occurred on June 2, 2015.

(4) There are no dilutive securities for purposes of calculating diluted FFO per common share and diluted FAD per common share when FFO attributable to common stockholders or FAD attributable to common stockholders is negative.

For additional information regarding the non-GAAP measures, see pages 30-31.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 6

Calculation of EBITDA
(in thousands, except ratios)
		Three Months Ended
		31-Mar-16			31-Dec-15			30-Sep-15			30-Jun-15			31-Mar-15
Net loss attributable to common stockholders		$	(12,707	)	$	(11,216	)	$	(13,849	)	$	(1,151	)	$	(5,892	)
Adjustments:
	Noncontrolling interests	(8		)	(20		)	(27		)	(1		)	(10		)
	Dilution of Series A Convertible Preferred Stock	—			—			(1,926		)	—			—
	Interest expense - consolidated (including discontinued operations)	11,501			11,668			11,884			14,635			16,304
	Interest expense - unconsolidated entities	641			727			1,437			617			615
	Amortization of deferred financing costs - consolidated (including discontinued operations)	739			1,048			914			899			922
	Amortization of deferred financing costs - unconsolidated entities	54			56			48			13			13
	Mark to market - consolidated (including discontinued operations)	—			(9		)	(33		)	(30		)	(28		)
	Mark to market - unconsolidated entities	—			—			1			16			17
	Total interest expense	12,935			13,490			14,251			16,150			17,843
	Tax (benefit) provision - consolidated (including discontinued operations)	182			209			36			1,338			(76		)
	Tax provision - unconsolidated entities	2			1			1			1			2
	Depreciation and amortization - consolidated (including discontinued operations)	32,044			30,182			31,446			31,081			30,022
	Depreciation and amortization - unconsolidated entities	2,045			2,427			1,904			1,367			1,287
	Depreciation and amortization - noncontrolling interest	(6		)	(10		)	—			—			—
	Impairment losses	4,826			—			—			—			132
	Gain on sale of real estate	(5,739		)	(3,698		)	(318		)	(50,641		)	(8,606		)
	Loss on early extinguishment of debt	—			31			127			21,412			36
EBITDA		33,574			31,396			31,645			19,556			34,738
Adjustments:
	Costs incurred in connection with listing activities	—			(27		)	2,562			2,488			503
	Acquisition expenses	—			26			642			1,193			2
	Non-cash write-off (recoveries) of tenant receivables	(53		)	557			802			2			1,829
	Severance charges	493			—			—			—			—
	Transition-related stock-based compensation expense (1)	—			2,837			—			—			—
	BHT Advisors termination fee and HPT Management buyout fee	—			—			101			10,200			—
Normalized EBITDA		34,014			34,789			35,752			33,439			37,072
Adjustments:
	EBITDA from properties disposed before period end	(832		)	25			(42		)	(2,933		)	(1,488		)
	Full quarter adjustment for acquired properties	—			—			656			—			—
Normalized estimated full period EBITDA from properties owned at period end		$	33,182		$	34,814		$	36,366		$	30,506		$	35,584
Fixed charges
	Interest expense	$	12,935		$	13,490		$	14,251		$	16,150		$	17,843
	Non-cash default interest (2)	(617		)	(625		)	(355		)	—			—
	Interest expense related to participating mortgage (3)	—			(53		)	(660		)	—			—
	Capitalized interest incurred (4)	198			199			119			132			176
	Normalized interest expense	12,516			13,011			13,355			16,282			18,019
	Principal payments (excludes debt payoff)	1,318			1,776			1,876			2,498			3,059
Fixed charges		$	13,834		$	14,787		$	15,231		$	18,780		$	21,078
Normalized interest coverage		2.72			2.67			2.68			2.05			2.06
Normalized fixed charge coverage		2.46			2.35			2.35			1.78			1.76

______________________

(1) During the fourth quarter of 2015, we incurred a charge from the acceleration of stock grants related to our transition from an arrears-based equity incentive program to a new, forward-looking, multi-year, long-term equity incentive program.

(2) We have a non-recourse loan in default which subjects us to incur default interest at a rate that is 500 basis points higher than the stated interest rate. Although there can be no assurance, we anticipate that when this property is sold or when ownership of this property is conveyed to the lender, this default interest will be forgiven.

(3) Represents an estimate of the portion of the Paces West B note that will be repaid based on achievement of certain investment return thresholds which is included in interest expense- unconsolidated entities above. Paces West was sold in November 2015.

(4) Excludes capitalized interest funded from construction loans.

For additional information regarding the non-GAAP measures, see pages 30-31.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 7

Non Wholly-Owned Entities Financial Summary
As of and for the Quarter Ended March 31, 2016
(dollars in thousands)
		Unconsolidated Entities at																		Consolidated Entities at
		TIER REIT Ownership Share																		TIER REIT Ownership Share
		Wanamaker Building			1325 G Street			Colorado Building			Domain 2 & 7			Domain 8						Legacy Land			Third + Shoal
Ownership % during the period		60.00%			10.00%			10.00%			49.84%			50.00%						95.00%			95.00%
Ownership % at period end		60.00%			10.00%			10.00%			49.84%			50.00%			Total			95.00%			95.00%			Total
Results of Operations
Rental income		$	3,486		$	256		$	94		$	1,088		$	—		$	4,924		—			343			343
Straight-line rent and lease incentive revenue		147			76			56			130			—			409			—			—			—
Above- and below-market rent amortization		106			(26		)	(12		)	—			—			68			—			—			—
Other income		44			40			—			—			—			84			—			—			—
	Total revenue	3,783			346			138			1,218			—			5,485			—			343			343
Property related expenses		1,280			87			43			298			15			1,723			3			371			374
Real estate taxes		214			72			28			233			—			547			19			—			19
Property management fees		108			8			2			50			—			168			—			—			—
	NOI	2,181			179			65			637			(15		)	3,047			(22		)	(28		)	(50		)
Interest expense		444			53			18			126			—			641			—			—			—
Amortization of deferred financing costs		20			6			2			37			—			65			—			—			—
Asset management fees		—			3			1			—			—			4			—			—			—
Real estate depreciation and amortization		1,207			176			89			428			—			1,900			—			106			106
Interest income and other expense		7			1			1			—			—			9			—			—			—
Provision for income taxes		2			—			—			—			—			2			—			2			2
	Net income (loss)	501			(60		)	(46		)	46			(15		)	426			(22		)	(136		)	(158		)
Adjustments:
Depreciation of basis adjustments		—			—			—			(146		)	—			(146		)	—			—			—
Above- and below-market amortization of basis adjustment		—			—			—			7			—			7			—			—			—
Eliminate amortization of deferred financing costs		11			—			—			—			—			11			—			—			—
Eliminate depreciation of construction management fees		1			—			—			—			—			1			—			—			—
Eliminate property management fees		108			7			1			—			—			116			—			—			—
	Adjusted net income (loss)	621			(53		)	(45		)	(93		)	(15		)	415			(22		)	(136		)	(158		)
Adjustments:
	Real estate depreciation and amortization	1,206			176			89			574			—			2,045			—			106			106
Funds from operations		$	1,827		$	123		$	44		$	481		$	(15	)	$	2,460		$	(22	)	$	(30	)	$	(52	)
Balance Sheet Information
Real estate book value		$	101,930		$	12,781		$	3,786		$	35,914		$	12,459		$	166,870		6,061			13,102			19,163
Accumulated depreciation		(25,286		)	(184		)	(40		)	(1,685		)	—			(27,195		)	—			(198		)	(198		)
Real estate book value after depreciation (1)		$	76,644		$	12,597		$	3,746		$	34,229		$	12,459		$	139,675		$	6,061		$	12,904		$	18,965
Cash and cash equivalents		$	1,762		$	268		$	228		$	1,001		$	916		$	4,175		$	63		$	836		$	899
Assets		$	96,817		$	15,731		$	5,062		$	40,549		$	13,402		$	171,561		$	6,123		$	13,864		$	19,987
Mortgage debt		$	45,243		$	9,629		$	3,400		$	24,475		$	—		$	82,747		$	—		$	—		$	—
Equity		$	48,551		$	5,596		$	1,509		$	14,743		$	12,489		$	82,888		$	6,103		$	13,343		$	19,446
Basis differences		(5,447		)	(1,288		)	(608		)	11,007			3,448			7,112			18			(391		)	(373		)
Carrying value of the Company’s investment		$	43,104		$	4,308		$	901		$	25,750		$	15,937		$	90,000		$	6,121		$	12,952		$	19,073
________________________________
(1)	Third + Shoal real estate book value after depreciation includes $7.6 million for a ground lease intangible.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 8

Same Store Analysis
(in thousands, except property count and percentages)
	Three Months Ended
Same Store GAAP NOI:	31-Mar-16			31-Mar-15			Favorable/ (Unfavorable)
Revenues:
Total revenue	$	58,924		$	57,411		$	1,513
Less: Lease termination fees	(432		)	(545		)	113
	58,492			56,866			1,626			2.9	%
Expenses:
Property operating expenses (less tenant improvement demolition costs)	17,556			17,909			353			2.0	%
Real estate taxes	9,187			8,813			(374		)	(4.2	)%
Property management fees	142			1,837			1,695			92.3	%
Property expenses	26,885			28,559			1,674			5.9	%
Same Store GAAP NOI - consolidated properties	31,607			28,307			3,300			11.7	%
Same Store GAAP NOI - unconsolidated properties (at ownership %)	2,550			2,235			315			14.1	%
Same Store GAAP NOI	$	34,157		$	30,542		$	3,615		11.8	%
Same Store Cash NOI:
Same Store GAAP NOI - consolidated properties	$	31,607		$	28,307		$	3,300
Less:
Straight-line rent revenue adjustment	(2,663		)	(413		)	(2,250		)
Above- and below-market rent amortization	(1,042		)	(1,220		)	178
Same Store Cash NOI - consolidated properties	27,902			26,674			1,228			4.6	%
Same Store Cash NOI - unconsolidated properties (at ownership %)	2,204			2,042			162			7.9	%
Same Store Cash NOI	$	30,106		$	28,716		$	1,390		4.8	%
Occupancy % at period end (% owned)	89.3		%	89.5		%
Operating properties	28
Rentable square feet (% owned)	9,586
Reconciliation of net loss to Same Store GAAP NOI and Same Store Cash NOI:
Net loss	$	(12,723	)	$	(5,902	)
Adjustments:
Interest expense	12,240			16,522
Asset impairment losses	4,826			132
Tenant improvement demolition costs	64			127
General and administrative	5,510			5,381
Tender offer and listing costs	—			503
Amortization of restricted shares and units	994			535
Straight-line rent expense adjustment	—			(7		)
Acquisition expense	—			2
Real estate depreciation and amortization	31,770			30,022
Depreciation and amortization of non-real estate assets	274			—
Interest and other income	(274		)	(145		)
Loss on early extinguishment of debt	—			36
Provision (benefit) for income taxes	182			(76		)
Equity in operations of investments	(415		)	(243		)
Income from discontinued operations	—			(1,490		)
Gain on sale of discontinued operations	—			(8,606		)
Gain on sale of assets	(5,739		)	—
Net operating income of non-same store properties	(4,670		)	(7,939		)
Lease termination fees	(432		)	(545		)
Same store GAAP NOI of unconsolidated properties (at ownership %)	2,550			2,235
Same Store GAAP NOI	34,157			30,542
Straight-line rent revenue adjustment	(2,663		)	(413		)
Above- and below-market rent amortization	(1,042		)	(1,220		)
Cash NOI adjustments for unconsolidated properties (at ownership %)	(346		)	(193		)
Same Store Cash NOI	$	30,106		$	28,716

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 9

Schedule of Properties Owned
as of March 31, 2016
(in thousands, except average effective and gross asking rent $/RSF and percentages)
		Rentable SF  (100%)	Rentable SF  (own %)			Average Effective Rent		Average Effective Rent $/RSF		Estimated Market Rent $/RSF				% Average Effective Rent (own %)
				Occupancy %								% of NRA (own %)
Property (% owned, if not 100%)	Location
Terrace Office Park	Austin, TX	619	619	92.7	%	$	20,311	$	35.37	$	41.60	5.9	%	8.2	%
Domain 3	Austin, TX	179	179	100.0	%	6,129		$	34.24	$	36.30	1.7	%	2.5	%
Domain 4	Austin, TX	153	153	90.8	%	3,826		$	27.52	$	36.30	1.5	%	1.6	%
Domain 7 (49.84%)	Austin, TX	222	111	93.7	%	3,492		$	33.68	$	40.91	1.1	%	1.4	%
Domain 2 (49.84%)	Austin, TX	115	57	100.0	%	2,319		$	40.58	$	40.91	0.5	%	0.9	%
Austin		1,288	1,119	94.1	%	36,077		$	34.26	$	39.89	10.7	%	14.6	%
5950 Sherry Lane	Dallas, TX	197	197	83.2	%	5,796		$	35.42	$	39.88	1.9	%	2.4	%
Burnett Plaza	Fort Worth, TX	1,025	1,025	82.2	%	15,897		$	18.86	$	23.00	9.8	%	6.4	%
Centreport Office Center	Fort Worth, TX	133	133	100.0	%	2,726		$	20.46	$	18.00	1.3	%	1.1	%
Dallas/Fort Worth		1,355	1,355	84.1	%	24,419		$	21.42	$	24.85	13.0	%	9.9	%
Loop Central	Houston, TX	575	575	89.9	%	12,552		$	24.29	$	25.50	5.5	%	5.1	%
One & Two Eldridge Place	Houston, TX	519	519	95.4	%	15,923		$	32.17	$	36.25	5.0	%	6.5	%
One BriarLake Plaza	Houston, TX	502	502	89.6	%	18,880		$	41.99	$	44.26	4.8	%	7.7	%
Two BriarLake Plaza	Houston, TX	333	333	67.9	%	8,227		$	36.40	$	44.42	3.2	%	3.3	%
Three Eldridge Place	Houston, TX	305	305	80.3	%	9,810		$	40.01	$	40.51	2.9	%	4.0	%
Houston		2,234	2,234	86.5	%	65,392		$	33.83	$	36.73	21.4	%	26.5	%
Bank of America Plaza	Charlotte, NC	891	891	89.5	%	19,355		$	24.29	$	30.75	8.6	%	7.9	%
Charlotte		891	891	89.5	%	19,355		$	24.29	$	30.75	8.6	%	7.9	%
Buena Vista Plaza	Burbank, CA	115	115	99.1	%	4,172		$	36.53	$	36.53	1.1	%	1.7	%
Los Angeles		115	115	99.1	%	4,172		$	36.53	$	36.53	1.1	%	1.7	%
Forum Office Park	Louisville, KY	328	328	97.6	%	5,722		$	17.86	$	18.00	3.1	%	2.3	%
Hurstbourne Place	Louisville, KY	235	235	87.7	%	3,912		$	19.03	$	19.75	2.3	%	1.6	%
One Oxmoor Place	Louisville, KY	135	135	98.5	%	3,045		$	22.93	$	21.50	1.3	%	1.2	%
Hurstbourne Park	Louisville, KY	104	104	72.1	%	1,355		$	17.95	$	19.00	1.0	%	0.5	%
Steeplechase Place	Louisville, KY	77	77	80.5	%	1,069		$	17.19	$	17.50	0.7	%	0.4	%
Lakeview	Louisville, KY	76	76	92.1	%	1,414		$	20.12	$	19.25	0.7	%	0.6	%
Hunnington	Louisville, KY	62	62	83.9	%	976		$	18.92	$	17.50	0.6	%	0.4	%
Louisville		1,017	1,017	90.3	%	17,493		$	19.06	$	19.01	9.8	%	7.1	%
Plaza at MetroCenter	Nashville, TN	361	361	92.0	%	6,049		$	18.21	$	18.50	3.5	%	2.5	%
Nashville		361	361	92.0	%	6,049		$	18.21	$	18.50	3.5	%	2.5	%
Eisenhower I	Tampa, FL	130	130	100.0	%	3,553		$	27.31	$	28.00	1.2	%	1.4	%
Tampa		130	130	100.0	%	3,553		$	27.31	$	28.00	1.2	%	1.4	%
801 Thompson	Rockville, MD	51	51	100.0	%	1,652		$	32.43	$	26.50	0.5	%	0.7	%
1325 G Street (10%)	Washington, D.C.	307	31	83.9	%	1,155		$	44.81	$	49.50	0.3	%	0.5	%
Colorado Building (10%)	Washington, D.C.	128	13	76.9	%	329		$	31.40	$	48.50	0.1	%	0.1	%
Washington, D.C.		486	95	91.6	%	3,136		$	36.05	$	35.90	0.9	%	1.3	%
Operating office properties in strategic portfolio		7,877	7,317	88.9	%	179,646		$	27.62	$	30.81	70.2	%	72.9	%
500 East Pratt	Baltimore, MD	280	280	98.2	%	8,867		$	32.24	$	31.08	2.7	%	3.6	%
Woodcrest Corporate Center	Cherry Hill, NJ	333	333	99.1	%	6,996		$	21.21	$	21.50	3.2	%	2.8	%
111 Woodcrest	Cherry Hill, NJ	53	53	84.9	%	940		$	20.89	$	16.00	0.5	%	0.4	%
FOUR40	Chicago, IL	1,041	1,041	73.1	%	23,752		$	31.19	$	35.71	10.0	%	9.6	%
Wanamaker Building (60%)	Philadelphia, PA	1,390	834	99.5	%	14,032		$	16.91	$	17.51	8.0	%	5.7	%
Three Parkway	Philadelphia, PA	561	561	92.2	%	12,313		$	23.83	$	24.21	5.4	%	5.0	%
Other operating office properties		3,658	3,102	88.9	%	66,900		$	24.26	$	25.59	29.8	%	27.1	%
Total operating office properties		11,535	10,419	88.9	%	$	246,546	$	26.62	$	29.26	100.0	%	100.0	%
Non-operating properties
Hurstbourne Plaza (1)	Louisville, KY	79	79	50.2	%
Fifth Third Center (2)	Columbus, OH	331	331	69.3	%
Total Properties		11,945	10,829
(1) Hurstbourne Plaza is a retail property planned for redevelopment within the Hurstbourne Business Park.
(2) The loan on Fifth Third Center is currently in default and we are working with the lender to dispose of this property on their behalf.
Average effective rent represents 12 times the sum of the monthly contractual amounts for base rent and the pro rata budgeted operating expense reimbursements, as of period end, related to leases in place as of period end, as reduced for free rent and excluding any scheduled future rent increases, as adjusted for our ownership interest.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 10

Portfolio Analysis
For the Three Months Ended and
as of March 31, 2016
	Number of	Number of	Net Rentable	Commenced		% of		NOI		% of
Metro Area	Properties	Buildings	Area (000's)	% SF Leased		NRA		($000)		NOI
Austin, TX	5	8	1,119	94.1	%	10.7	%	$	5,682	14.9	%
Dallas/Fort Worth, TX	3	4	1,355	84.1	%	13.0	%	3,615		9.5	%
Houston, TX	5	8	2,234	86.5	%	21.4	%	10,302		27.0	%
Charlotte, NC	1	1	891	89.5	%	8.6	%	3,971		10.4	%
Los Angeles, CA	1	1	115	99.1	%	1.1	%	772		2.0	%
Louisville, KY	7	10	1,017	90.3	%	9.8	%	2,434		6.4	%
Nashville, TN	1	3	361	92.0	%	3.5	%	882		2.3	%
Tampa, FL	1	1	130	100.0	%	1.2	%	780		2.0	%
Washington, D.C.	3	3	95	91.6	%	0.9	%	536		1.4	%
Other Markets	6	6	3,102	88.9	%	29.8	%	9,174		24.1	%
Total	33	45	10,419	88.9	%	100.0	%	$	38,148	100.0	%
Notes:
(1) Analysis relates to operating properties owned at the end of the most recent period only.
(2) Amounts reflect TIER REIT’s ownership %.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 11

Components of Net Asset Value
(in thousands, except percentages)
				Annualized Three Months Ended
				31-Mar-16
Consolidated total revenue				$	273,912
		Less:
		GAAP rent adjustments		(18,392		)
		Lease termination fees		(2,356		)
				253,164
Consolidated total property operating expenses				(127,332		)
Adjusted cash NOI				125,832
		Adjustments:
		Adjusted cash NOI from unconsolidated real estate assets, at ownership share		10,744
		Adjusted cash NOI from sold properties, at ownership share		(2,411		)
		Adjusted cash NOI from non-stabilized properties, at ownership share (1)		(19,288		)
		Adjusted cash NOI from land and development properties, at ownership share		208
Total adjusted cash NOI at ownership share				$	115,085
				31-Mar-16
Other real estate properties
		Estimated value of non-stabilized real estate properties, at ownership share		$	506,900
		Cost basis of land and development properties, at ownership share		73,240
Total other real estate properties				$	580,140
Other tangible assets
		Cash and cash equivalents		$	5,532
		Restricted cash		12,756
		Accounts receivable (excluding $70,670 of straight-line rent receivable)		7,892
		Prepaid expenses and other assets		6,025
Total other tangible assets				$	32,205
Liabilities
		Mortgage debt		$	358,717
		Unsecured term loans and revolving credit facility		683,000
		Accrued and other liabilities		99,519
		Ownership share of unconsolidated mortgage debt		82,747
Total liabilities				$	1,223,983
Total common shares, restricted stock, and restricted stock units outstanding				47,879
(1	)	Non-stabilized properties include:	Economic % SF Leased
			31-Mar-16
		Buena Vista Plaza (a)	99%
		Burnett Plaza	69%
		FOUR40	65%
		Two BriarLake Plaza	56%
(a)		Free rent at Buena Vista Plaza expired February 2016.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 12

Selected Non-Stabilized Properties
	Property Name Market Sub-Market	Property Type	Rentable Square feet	Occupancy % at March 31, 2016	Estimated Cash NOI at Stabilization (in thousands)	Estimated Stabilization date	Description
	Buena Vista Plaza	Office	115,000	99.1%	$3,000	2016	Completed ten year renewal of 113,000 square feet by the major tenant in the second quarter of 2015 with free rent for eleven months, beginning in April 2015, before returning to stabilized economic occupancy.
	Burbank
	Burbank media district
	Burnett Plaza	Office	1,025,000	82.2%	$13,500	2017	A tenant that is in bankruptcy vacated approximately 50,000 square feet in the first quarter of 2016 and will vacate an additional approximately 50,000 square feet in the second quarter of 2016, of which approximately 50,000 square feet has been leased by an existing tenant’s expansion. Budgeted $2.2 million in strategic capital improvements.
	Dallas/Fort Worth
	Fort Worth CBD
	FOUR40	Office	1,041,000	73.1%	$16,500	2017	Completed $5.8 million lobby renovation in the third quarter of 2014. Construction of a $10.6 million tenant amenity floor including wi-fi lounge, conference center, and café was completed in June 2015.
	Chicago
	Central Loop
	Two BriarLake Plaza	Office Development	333,000	67.9%	$8,000	2017	Property operates as a multi-campus facility with our One BriarLake Plaza property. Major construction was completed in the third quarter of 2014.
	Houston
	Westchase

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 13

Significant Tenants
March 31, 2016
(In thousands, except percentages and years)
Properties in Strategic Portfolio
	Annualized Gross Rental Revenues		Percentage of Annualized Gross Rental Revenues			Percentage of Square Feet Leased		Weighted Average Remaining Term (Years)
					Square Feet Leased				Moody’s / S&P Credit Rating
Tenant
Amoco	$	12,707	7	%	329	5	%	2.4	A2 / A
Bank of America	9,634		5	%	421	6	%	2.9	Baa1 / BBB+
Apache Corporation	8,293		4	%	210	3	%	8.6	Baa3 / BBB
Samsung Engineering America	7,105		4	%	161	2	%	10.7	NR
GSA	6,631		4	%	278	4	%	4.2	U.S. Government
McDermott, Inc.	5,901		3	%	190	3	%	4.4	B1 / B+
Universal Pegasus International	5,456		3	%	218	3	%	4.1	NR
Americredit Financial Services	4,558		2	%	243	4	%	10.1	NR
Disney Enterprises Inc	4,004		2	%	113	2	%	9.9	A2 / A
Blackbaud, Inc.	3,800		2	%	113	2	%	7.5	NR
E.R. Squibb and Sons, LLC	3,553		2	%	130	2	%	8.3	A2 / A+
Vinson & Elkins LLP	3,541		2	%	88	1	%	5.8	NR
SCOR Global Life	3,394		2	%	140	2	%	12.3	NR / AA-
Linebarger Goggan Blair & Sampson, LLP	3,209		2	%	111	2	%	6.6	NR
Nexen Petroleum	2,752		1	%	63	1	%	1.2	NR
Total of largest 15 tenants at operating office properties in strategic portfolio	$	84,538	45	%	2,808	42	%	6.0
Total all tenants at operating office properties in strategic portfolio	$	186,222			6,504			5.3
Total Portfolio
	Annualized Gross Rental Revenues		Percentage of Annualized Gross Rental Revenues			Percentage of Square Feet Leased		Weighted Average Remaining Term (Years)
					Square Feet Leased				Moody’s / S&P Credit Rating
Tenant
Amoco	$	12,707	5	%	329	4	%	2.4	A2 / A
GSA	11,381		4	%	493	5	%	4.5	U.S. Government
Bank of America	9,634		4	%	421	5	%	2.9	Baa1 / BBB+
Apache Corporation	8,293		3	%	210	2	%	8.6	Baa3 / BBB
Samsung Engineering America	7,105		3	%	161	2	%	10.7	NR
McDermott, Inc.	5,901		2	%	190	2	%	4.4	B1 / B+
Universal Pegasus International	5,456		2	%	218	2	%	4.1	NR
Drexel University	4,808		2	%	191	2	%	6.9	NR
Americredit Financial Services	4,558		2	%	243	3	%	10.1	NR
Disney Enterprises Inc	4,004		2	%	113	1	%	9.9	A2 / A
Blackbaud, Inc.	3,800		1	%	113	1	%	7.5	NR
Xerox Corporation	3,691		1	%	151	2	%	4.4	Baa2 / BBB-
E.R. Squibb and Sons, LLC	3,553		1	%	130	1	%	8.3	A2 / A+
Vinson & Elkins LLP	3,541		1	%	88	1	%	5.8	NR
CTC Holdings, L.P.	3,493		1	%	87	1	%	5.9	NR
Total of largest 15 tenants	$	91,925	34	%	3,138	34	%	5.7
Total all tenants	$	257,658			9,262			5.7

Notes:

The above tables set forth the company’s 15 largest tenants including subsidiaries for the operating properties as of the date noted above, based upon annualized gross rents plus estimated operating cost recoveries in place at the end of the above noted period.

As annualized rental revenue is not derived from the historical GAAP results, historical results may differ from those set forth above.

Amounts reflect TIER REIT’s ownership %.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 14

Industry Diversification (by square foot)

As of March 31, 2016

Notes:

The Company’s tenants are classified according to the U.S. Government’s North American Industrial Classification System (NAICS).

Amounts reflect TIER REIT’s ownership %.

“Other” includes nine industry classifications.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 15

Leasing Activity Summary
For the Three Months Ended
March 31, 2016
		Occupancy								Occupancy			Cash						Straight-lined
	Rentable SF (000’s)	%		SF (000’s)	Activity for the Quarter (SF 000’s)					SF (000’s)	%		Net Rent /SF				% Increase of Cash Net Rent		Net Rent /SF				% Increase of SL Net Rent
Market		31-Dec-15		31-Dec-15	Expiring		Renewals	Expansions	New	31-Mar-16	31-Mar-16		Expiring		Activity				Expiring		Activity
Austin (1)	1,119	94.5	%	1,057	(119	)	82	—	33	1,053	94.1	%	$	13.02	$	20.85	60	%	$	12.63	$	18.59	47	%
Dallas/Fort Worth	1,355	86.4	%	1,171	(112	)	23	58	—	1,140	84.1	%	$	15.86	$	14.18	-11	%	$	13.10	$	13.97	7	%
Houston	2,234	87.9	%	1,964	(52	)	21	—	—	1,933	86.5	%	$	11.01	$	9.81	-11	%	$	10.41	$	9.89	-5	%
Charlotte	891	87.8	%	782	(4	)	4	—	15	797	89.5	%	$	19.39	$	25.10	29	%	$	18.16	$	20.39	12	%
Los Angeles	115	99.1	%	114	(5	)	5	—	—	114	99.1	%	$	30.40	$	29.43	-3	%	$	22.00	$	30.75	40	%
Louisville	1,017	94.8	%	964	(116	)	69	—	1	918	90.3	%	$	12.18	$	9.01	-26	%	$	11.20	$	9.32	-17	%
Nashville	361	92.8	%	335	(3	)	—	—	—	332	92.0	%	$	—	$	—	—	%	$	—	$	—	0	%
Tampa	130	100.0	%	130	—		—	—	—	130	100.0	%	$	—	$	—	—		$	—	$	—	0	%
Washington, D.C.	95	93.7	%	89	(3	)	1	—	—	87	91.6	%	$	35.19	$	27.09	-23	%	$	35.74	$	30.08	-16	%
Operating office properties in strategic portfolio	7,317	90.3	%	6,606	(414	)	205	58	49	6,504	88.9	%	$	14.17	$	16.14	14	%	$	12.84	$	15.07	17	%
Other operating office properties	3,102	87.3	%	2,707	(99	)	66	12	72	2,758	88.9	%	$	16.53	$	15.41	-7	%	$	15.36	$	15.21	-1	%
Total	10,419	89.4	%	9,313	(513	)	271	70	121	9,262	88.9	%	$	14.94	$	15.90	6	%	$	13.66	$	15.12	11	%

(1) At Domain 4 in Austin, a 52,000 square foot tenant restructured their lease effective 1/1/16 extending their term for one additional year from 12/31/16 to 12/31/17.  The initial 12 months of the lease was at a net rate of $8.93 followed by a second 12 months at the current market rate

of $21.63.

Notes:

Analysis relates to operating properties owned at the end of the period and reflects TIER REIT’s ownership %.

Occupancy includes all leases for tenants under lease contracts that have commenced during the period.

Rates for expiring leases relate to the lease previously occupying the specific space for which positive absorption was shown or the current lease rate if it is a first generation lease.

Net Rent is equal to the fixed base rental amount paid under the terms of the lease less any portion used to offset real estate taxes, utility charges, and other operating expenses incurred in connection with the leased space.

Cash Net Rent disregards any free rent periods. Therefore, the rate shown is first full monthly cash rent paid.

The impact of short term temporary leasing activity is excluded from the analysis of % increase of cash net rent and % increase of SL net rent.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 16

Leasing Rate Activity Summary
For the Three Months Ended
March 31, 2016
	Renewals											Expansions											New
		Cash					Straight-lined						Cash					Straight-lined						Cash					Straight-lined
	SF (000’s)	Net Rent /SF					Net Rent /SF					SF (000’s)	Net Rent /SF					Net Rent /SF					SF (000’s)	Net Rent /SF					Net Rent /SF
Markets		Expiring		Activity			Expiring		Activity				Expiring		Activity			Expiring		Activity				Expiring		Activity			Expiring		Activity
Austin (1)	82	$	9.72	$	18.31		$	9.57	$	14.34		—	$	—	$	—		$	—	$	—		33	$	21.22	$	27.18		$	20.27	$	29.19
Dallas/Fort Worth	23	$	15.38	$	14.62		$	13.23	$	14.81		58	$	16.04	$	14.02		$	13.00	$	13.48		—	$	—	$	—		$	—	$	—
Houston	21	$	11.01	$	9.81		$	10.41	$	9.89		—	$	—	$	—		$	—	$	—		—	$	—	$	—		$	—	$	—
Charlotte	4	$	23.76	$	26.79		$	20.30	$	27.43		—	$	—	$	—		$	—	$	—		15	$	18.08	$	24.59		$	17.45	$	18.19
Los Angeles	5	$	30.40	$	29.43		$	22.00	$	30.75		—	$	—	$	—		$	—	$	—		—	$	—	$	—		$	—	$	—
Louisville	69	$	12.20	$	8.98		$	11.19	$	9.31		—	$	—	$	—		$	—	$	—		1	$	11.30	$	10.47		$	11.30	$	10.11
Nashville	—	$	—	$	—		$	—	$	—		—	$	—	$	—		$	—	$	—		—	$	—	$	—		$	—	$	—
Tampa	—	$	—	$	—		$	—	$	—		—	$	—	$	—		$	—	$	—		—	$	—	$	—		$	—	$	—
Washington, D.C.	1	$	35.19	$	27.09		$	35.74	$	30.08		—	$	—	$	—		$	—	$	—		—	$	—	$	—		$	—	$	—
Operating office properties in strategic portfolio	205	$	12.22	$	14.37		$	11.25	$	12.98		58	$	16.04	$	14.02		$	13.00	$	13.48		49	$	20.06	$	26.05		$	19.22	$	25.43
Percentage increase (decrease)				18		%			15		%				(13		)%			4		%				30		%			32		%
Other operating office properties	66	$	13.96	$	14.10		$	13.29	$	14.45		12	$	11.27	$	11.27		$	10.43	$	10.43		72	$	19.80	$	17.34		$	18.10	$	16.70
Total	271	$	12.65	$	14.30		$	11.75	$	13.34		70	$	15.22	$	13.55		$	12.56	$	12.96		121	$	19.91	$	20.87		$	18.56	$	20.23
Percentage increase (decrease)				13		%			14		%				(11		)%			3		%				5		%			9		%
(1) At Domain 4 in Austin, a 52,000 square foot tenant restructured their lease effective 1/1/16 extending their term for one additional year from 12/31/16 to 12/31/17.  The initial 12 months of the lease was at a net rate of $8.93 followed by a second 12 months at the current market rate of $21.63.
Notes:
Analysis relates to operating properties owned at the end of the period and reflects TIER REIT’s ownership %.
SF includes all leases for tenants under lease contracts that have commenced during the period.
Rates for expiring leases relate to the lease previously occupying the specific space for which positive absorption was shown or the current lease rate if it is a first generation lease.
Net Rent is equal to the fixed base rental amount paid under the terms of the lease less any portion used to offset real estate taxes, utility charges, and other operating expenses incurred in connection with the leased space.
Cash Net Rent disregards any free rent periods. Therefore, the rate shown is first full monthly cash rent paid.
The impact of short term temporary leasing activity is excluded from the analysis of % increase of cash net rent and % increase of SL net rent.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 17

Lease Expirations
For Four Quarters From April 1, 2016
(In thousands)
	Market	Month to Month		Q2 2016		Q3 2016		Q4 2016		Q1 2017		Grand Total
	By Square Foot
	Austin	—		28		90		19		—		137
	Dallas/Fort Worth	1		7		1		10		—		19
	Houston	3		4		61		11		—		79
	Charlotte	—		—		—		3		—		3
	Los Angeles	—		—		—		—		—		—
	Louisville	4		8		26		13		66		117
	Nashville	172		2		—		16		—		190
	Tampa	—		—		—		—		—		—
	Washington, D.C.	—		52		—		1		2		55
	Operating office properties in strategic portfolio	180		101		178		73		68		600
	Other operating office properties	9		69		12		6		32		128
	Total	189		170		190		79		100		728
	By Annualized Expiring Rentals
	Austin	$	—	$	679	$	2,950	$	736	$	—	$	4,365
	Dallas/Fort Worth	12		229		17		271		—		529
	Houston	1		137		1,671		510		—		2,319
	Charlotte	—		—		—		112		27		139
	Los Angeles	13		—		—		—		—		13
	Louisville	92		136		531		242		1,362		2,363
	Nashville	2,874		42		—		292		—		3,208
	Tampa	—		—		—		—		—		—
	Washington, D.C.	3		1,715		—		44		89		1,851
	Operating office properties in strategic portfolio	2,995		2,938		5,169		2,207		1,478		14,787
	Other operating office properties	216		1,657		353		217		1,110		3,553
	Total	$	3,211	$	4,595	$	5,522	$	2,424	$	2,588	$	18,340
	By Expiring Rent Per SF
	Austin	$	—	$	24.49	$	32.66	$	38.27	$	—	$	31.80
	Dallas/Fort Worth	$	8.77	$	30.51	$	25.05	$	27.94	$	—	$	27.84
	Houston	$	0.45	$	35.28	$	27.05	$	44.49	$	—	$	29.07
	Charlotte	$	—	$	—	$	—	$	35.85	$	60.72	$	38.93
	Los Angeles	$	—	$	—	$	—	$	—	$	—	$	—
	Louisville	$	24.51	$	16.24	$	19.61	$	18.60	$	21.32	$	20.35
	Nashville	$	16.66	$	21.78	$	—	$	18.75	$	—	$	16.88
	Tampa	$	—	$	—	$	—	$	—	$	—	$	—
	Washington, D.C.	$	32.23	$	32.95	$	—	$	46.29	$	55.83	$	33.85
	Operating office properties in strategic portfolio	$	16.64	$	29.09	$	29.04	$	30.23	$	21.74	$	24.65
	Other operating office properties	$	24.00	$	24.01	$	29.42	$	36.17	$	34.69	$	27.76
	Total	$	16.99	$	27.03	$	29.06	$	30.68	$	25.88	$	25.19
Notes:
Leases with an expiration on the last day of the period are considered leased at the last day of the period (i.e., expiring on the first day of the following period).
Reflects TIER REIT’s ownership %.
Rentals shown above are the contractually obligated annualized base rent charged in the final month prior to lease termination grossed up to include current operating cost recoveries.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 18

Lease Expirations
Annually From April 1, 2016
(In thousands, except percentage and per SF data)
	Market	2016			2017			2018			2019			2020			2021			2022			2023			2024			2025			2026+			Grand Total
	By Square Foot
	Austin	137			97			115			106			103			70			149			177			—			3			95			1,053
	Dallas/Fort Worth	19			128			191			100			72			69			16			144			—			—			402			1,140
	Houston	79			254			59			315			305			195			101			25			272			55			273			1,933
	Charlotte	3			21			12			405			17			19			8			81			32			8			192			797
	Los Angeles	—			—			—			4			—			—			—			—			—			—			110			114
	Louisville	52			273			25			152			86			54			15			35			14			192			19			918
	Nashville	190			10			3			—			2			21			14			—			4			22			67			332
	Tampa	—			—			—			—			—			—			—			—			130			—			—			130
	Washington, D.C.	53			2			2			1			3			1			3			5			—			6			10			87
	Operating office properties in strategic portfolio	533			785			407			1,083			588			429			306			467			452			286			1,168			6,504
	As a % of Occupied SF	8		%	12		%	6		%	17		%	9		%	7		%	5		%	7		%	7		%	4		%	18		%	100		%
	As a % of Total NRA	7		%	11		%	6		%	15		%	8		%	6		%	4		%	6		%	6		%	4		%	16		%	89		%
	Other operating office properties	95			153			182			174			465			205			291			381			39			94			679			2,758
	Total	628			938			589			1,257			1,053			634			597			848			491			380			1,847			9,262
	As a % of Occupied SF	7		%	10		%	6		%	14		%	11		%	7		%	7		%	9		%	5		%	4		%	20		%	100		%
	As a % of Total NRA	6		%	9		%	6		%	12		%	10		%	6		%	6		%	8		%	5		%	3		%	18		%	89		%
	By Annualized Expiring Rentals
	Austin	$	4,365		$	3,506		$	4,034		$	4,438		$	4,098		$	2,881		$	6,247		$	7,025		$	—		$	143		$	4,333		$	41,070
	Dallas/Fort Worth	529			3,010			4,738			2,476			2,701			2,424			264			4,148			—			—			11,019			31,309
	Houston	2,319			9,425			2,500			12,694			9,881			6,569			2,920			1,184			11,885			1,810			11,016			72,203
	Charlotte	112			702			460			9,422			571			699			270			2,943			329			415			6,429			22,352
	Los Angeles	13			—			—			192			—			—			—			—			—			—			5,328			5,533
	Louisville	1,001			5,135			485			3,180			1,628			1,055			293			840			309			3,933			423			18,282
	Nashville	3,208			185			54			—			39			407			286			—			87			521			1,498			6,285
	Tampa	—			—			—			—			—			—			—			—			4,473			—			—			4,473
	Washington, D.C.	1,762			89			117			78			213			50			339			302			30			336			592			3,908
	Operating office properties in strategic portfolio	13,309			22,052			12,388			32,480			19,131			14,085			10,619			16,442			17,113			7,158			40,638			205,415
	As a % of Total Annualized Expiring Rentals	6		%	11		%	6		%	16		%	9		%	7		%	5		%	8		%	8		%	4		%	20		%	100		%
	Other operating office properties	2,443			6,038			6,045			4,910			13,045			5,613			10,162			12,579			973			3,982			11,701			77,491
	Total	$	15,752		$	28,090		$	18,433		$	37,390		$	32,176		$	19,698		$	20,781		$	29,021		$	18,086		$	11,140		$	52,339		$	282,906
	As a % of Total Annualized Expiring Rentals	6		%	10		%	7		%	13		%	11		%	7		%	7		%	10		%	6		%	4		%	19		%	100		%
	By Expiring Rent Per SF
	Austin	$	31.80		$	36.32		$	34.85		$	41.94		$	39.67		$	42.02		$	41.81		$	39.68		$	—		$	43.31		$	45.13		$	39.00
	Dallas/Fort Worth	$	27.69		$	23.57		$	24.74		$	24.92		$	37.78		$	34.90		$	16.50		$	28.86		$	—		$	—		$	27.41		$	27.45
	Houston	$	29.07		$	37.10		$	42.67		$	40.20		$	32.42		$	33.69		$	28.62		$	46.64		$	43.76		$	33.48		$	40.51		$	37.35
	Charlotte	$	35.85		$	33.37		$	37.92		$	23.26		$	34.35		$	36.34		$	36.47		$	36.30		$	10.37		$	50.86		$	33.60		$	28.05
	Los Angeles	$	—		$	—		$	—		$	44.64		$	—		$	—		$	—		$	—		$	—		$	—		$	48.47		$	48.44
	Louisville	$	19.17		$	18.89		$	19.77		$	20.89		$	18.77		$	19.50		$	18.68		$	23.70		$	22.37		$	20.36		$	22.69		$	19.91
	Nashville	$	16.88		$	19.29		$	19.01		$	—		$	19.76		$	19.51		$	20.76		$	—		$	21.04		$	23.26		$	22.47		$	18.92
	Tampa	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	34.39		$	—		$	—		$	34.39
	Washington, D.C.	$	33.22		$	44.40		$	58.57		$	78.44		$	70.95		$	49.80		$	112.93		$	60.36		$	—		$	55.92		$	59.17		$	45.41
	Operating office properties in strategic portfolio	$	24.97		$	28.09		$	30.44		$	29.99		$	32.54		$	32.83		$	34.70		$	35.21		$	37.86		$	25.03		$	34.79		$	31.58
	Other operating office properties	$	25.72		$	39.46		$	33.21		$	28.22		$	28.05		$	27.38		$	34.92		$	33.02		$	24.95		$	42.36		$	17.23		$	28.10
	Total	$	25.08		$	29.95		$	31.30		$	29.75		$	30.56		$	31.07		$	34.81		$	34.22		$	36.84		$	29.32		$	28.34		$	30.54
	Notes:
	Leases with an expiration on the last day of the period are considered leased at the last day of the period (i.e., expiring on the first day of the following period).
	Reflects TIER REIT’s ownership %.
	Rentals shown above are the contractually obligated annualized base rent charged in the final month prior to lease termination grossed up to include current operating cost recoveries.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 19

Occupancy Trends
	Rentable SF (in thousands)
		Occupancy %
Market	31-Mar-16	31-Mar-16		31-Dec-15		30-Sep-15		30-Jun-15		31-Mar-15
Austin	1,119	94.1	%	94.5	%	94.6	%	93.2	%	92.9	%
Dallas/Fort Worth	1,355	84.1	%	86.4	%	88.2	%	85.0	%	83.3	%
Houston (1)	2,234	86.5	%	87.9	%	93.0	%	94.2	%	97.2	%
Charlotte	891	89.5	%	87.8	%	86.4	%	89.2	%	88.6	%
Los Angeles	115	99.1	%	99.1	%	100.0	%	100.0	%	100.0	%
Louisville	1,017	90.3	%	94.8	%	95.0	%	92.6	%	90.6	%
Nashville	361	92.0	%	92.8	%	92.8	%	92.8	%	91.4	%
Tampa	130	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%
Washington, D.C.	95	91.6	%	93.7	%	93.7	%	93.7	%	90.3	%
Operating office properties in strategic portfolio	7,317	88.9	%	90.3	%	92.0	%	91.4	%	91.3	%
Other operating office properties	3,102	88.9	%	87.3	%	86.3	%	86.1	%	85.8	%
Total	10,419	88.9	%	89.4	%	90.3	%	89.7	%	89.5	%
(1) The fourth quarter of 2015 reflects the inclusion of our recently developed Two BriarLake Plaza property which is 67.9% leased as of March 31, 2016.
Notes:
Analysis relates to operating properties owned at the end of the most recent period and reflects TIER REIT’s ownership %.
Occupancy % is as of the last day of the indicated period.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 20

Leasing Cost Summary
For the Three Months Ended
March 31, 2016
			Weighted Average Leasing Costs
	SF (000’s)	Wtd Avg Term (Yrs)	Per Square Foot						Per Square Foot / Year
Renewal			Comms		TI & Other		Total		Comms		TI & Other		Total
Market
Austin	82	1.8	$	2.23	$	4.63	$	6.86	$	1.00	$	2.72	$	3.72
Dallas/Fort Worth	23	5.9	$	7.28	$	6.68	$	13.95	$	1.30	$	1.12	$	2.42
Houston	21	5.9	$	7.94	$	10.76	$	18.70	$	1.32	$	1.80	$	3.12
Charlotte	4	4.2	$	6.51	$	10.20	$	16.71	$	1.56	$	2.45	$	4.01
Los Angeles	5	3.0	$	7.80	$	5.00	$	12.80	$	2.60	$	1.67	$	4.27
Louisville	69	3.6	$	3.68	$	9.69	$	13.37	$	0.90	$	2.17	$	3.07
Nashville	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Tampa	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Washington, D.C.	1	8.0	$	22.90	$	24.04	$	46.94	$	2.86	$	3.01	$	5.87
Operating office properties in strategic portfolio	205	3.4	$	4.19	$	7.40	$	11.59	$	1.24	$	2.19	$	3.43
Other operating office properties	66	1.5	$	1.27	$	4.77	$	6.04	$	0.83	$	3.11	$	3.93
Total	271	2.9	$	3.48	$	6.76	$	10.24	$	1.18	$	2.31	$	3.49
Expansion
Market
Austin	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Dallas/Fort Worth	58	9.8	$	15.54	$	8.91	$	24.45	$	1.61	$	0.90	$	2.51
Houston	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Charlotte	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Los Angeles	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Louisville	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Nashville	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Tampa	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Washington, D.C.	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Operating office properties in strategic portfolio	58	9.8	$	15.54	$	8.91	$	24.45	$	1.61	$	0.90	$	2.51
Other operating office properties	12	0.4	$	—	$	—	$	—	$	—	$	—	$	—
Total	70	8.2	$	12.87	$	7.39	$	20.26	$	1.56	$	0.90	$	2.46
New
Market
Austin	33	9.5	$	25.61	$	40.91	$	66.53	$	2.67	$	4.28	$	6.95
Dallas/Fort Worth	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Houston	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Charlotte	15	1.2	$	2.20	$	1.82	$	4.02	$	1.89	$	1.56	$	3.45
Los Angeles	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Louisville	1	5.3	$	5.46	$	12.35	$	17.81	$	1.04	$	2.35	$	3.39
Nashville	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Tampa	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Washington, D.C.	—	—	$	—	$	—	$	—	$	—	$	—	$	—
Operating office properties in strategic portfolio	49	6.9	$	18.03	$	28.36	$	46.40	$	2.62	$	4.12	$	6.74
Other operating office properties	72	7.5	$	6.05	$	25.63	$	31.68	$	0.80	$	3.41	$	4.21
Total	121	7.3	$	10.90	$	26.74	$	37.64	$	1.50	$	3.68	$	5.18
Notes:
Analysis relates to operating properties owned at the end of the period and reflects TIER REIT’s ownership %.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 21

Leasing Cost Trend Analysis
	Three Months Ended		Year Ended		Year Ended
	31-Mar-16		31-Dec-15		31-Dec-14
Renewal Leasing
Square Feet (in thousands)	271		1,052		1,298
Weighted Average Term (in years)	2.9		6.8		5.7
Commissions per SF	$	3.48	$	7.13	$	4.68
TI and Other Leasing Cost per SF	6.76		18.72		4.62
Total Leasing Cost per SF	$	10.24	$	25.85	$	9.30
Commissions per SF per Year	$	1.18	$	1.07	$	0.93
TI and Other Leasing Cost per SF per Year	2.31		2.70		0.74
Total Leasing Cost per SF per Year	$	3.49	$	3.77	$	1.67
Expansion Leasing
Square Feet (in thousands)	70		246		264
Weighted Average Term (in years)	8.2		6.3		6.6
Commissions per SF	$	12.87	$	8.73	$	9.41
TI and Other Leasing Cost per SF	7.39		24.07		21.39
Total Leasing Cost per SF	$	20.26	$	32.80	$	30.80
Commissions per SF per Year	$	1.56	$	1.41	$	1.41
TI and Other Leasing Cost per SF per Year	0.90		3.91		3.11
Total Leasing Cost per SF per Year	$	2.46	$	5.32	$	4.52
New Leasing
Square Feet (in thousands)	121		480		927
Weighted Average Term (in years)	7.3		8.0		8.4
Commissions per SF	$	10.90	$	12.91	$	12.15
TI and Other Leasing Cost per SF	26.74		40.55		36.28
Total Leasing Cost per SF	$	37.64	$	53.46	$	48.43
Commissions per SF per Year	$	1.50	$	1.60	$	1.45
TI and Other Leasing Cost per SF per Year	3.68		5.05		4.34
Total Leasing Cost per SF per Year	$	5.18	$	6.65	$	5.79
Total Leasing
Square Feet (in thousands)	462		1,778		2,489
Weighted Average Term (in years)	4.9		7.1		6.8
Commissions per SF	$	6.85	$	8.92	$	7.96
TI and Other Leasing Cost per SF	12.09		25.35		18.19
Total Leasing Cost per SF	$	18.94	$	34.27	$	26.15
Commissions per SF per Year	$	1.41	$	1.26	$	1.18
TI and Other Leasing Cost per SF per Year	2.48		3.50		2.33
Total Leasing Cost per SF per Year	$	3.89	$	4.76	$	3.51
Notes:
Analysis relates to operating properties owned at the end of the indicated period and reflects TIER REIT’s ownership %.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 22

	Development, Leasing, and
	Capital Expenditures Summary
	(in thousands)
		For the Three Months Ended
		31-Mar-16		31-Dec-15		30-Sep-15		30-Jun-15		31-Mar-15
	Recurring capital expenditures
	Leasing costs	$	7,168	$	8,297	$	10,046	$	10,105	$	10,253
	Building improvements	2,185		2,816		3,749		3,962		2,994
	Subtotal recurring capital expenditures	9,353		11,113		13,795		14,067		13,247
	Non-recurring capital expenditures
	Building improvements (1)	600		1,185		—		—		125
	Leasing costs (2)	3,547		3,258		1,907		4,093		5,454
	Development (3)	1,409		1,790		3,278		3,307		2,286
	Redevelopment (4)	1,028		298		13		4,375		4,506
	Subtotal non-recurring capital expenditures	6,584		6,531		5,198		11,775		12,371
	Total capital expenditures	$	15,937	$	17,644	$	18,993	$	25,842	$	25,618
Notes:
All amounts represent TIER REIT’s ownership %.
Beginning in January 2016, leasing costs reimbursed to us by tenants when tenant improvement allowances have been exceeded are excluded from the above amounts.
(1)	Non-recurring building improvements include costs identified as deferred capital needs at the acquisition of a property.
(2)	Non-recurring leasing costs include costs incurred within 12 months of acquisition to lease space that was vacant at acquisition and costs incurred to lease space that has been vacant for at least 12 months. Cost incurred within 12 months of acquisition to lease space that was vacant at acquisition were as follows:
		$	992	$	455	$	534	$	662	$	674
(3)	Development includes all new construction costs related to base building and all costs associated with leasing development projects.
(4)	Redevelopment costs are for capital projects where substantial improvements are made to the property that change the character of the asset and are expected to result in development type returns on capital.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 23

Potential Future Development Sites
March 31, 2016
			Approximate Rentable Square Feet
				Month of Acquisition	Cost Basis (in millions)
Project	Market (submarket)	Acres					Comments
Hurstbourne Plaza	Louisville (Hurstbourne)	6.1	350,000	Dec-07	N/A		Planned mixed-use redevelopment of the Hurstbourne Business Center
Burnett Plaza	Fort Worth (CBD)	1.4	N/A	Jan-07	$	3.3	Planned mixed-use development and garage for use at Burnett Plaza
Eisenhower II	Tampa	5.2	130,000	Dec-07	$	1.6	Office building
Third + Shoal (95%) (1)	Austin (CBD)	0.8	325,000	Jun-15	$	13.2	Office building
Legacy Land (95%) (1)	Dallas (Plano - Legacy)	4.0	570,000	Jun-15	$	6.4	Office building(s)
Domain B	Austin (Domain)	6.2	300,000 - 400,000	Jul-15	$	12.7	Office building(s)
Domain C	Austin (Domain)	6.3	400,000 - 500,000	Jul-15	$	16.5	Office building(s)
Domain D & G	Austin (Domain)	5.6	300,000 - 400,000	Jul-15	$	9.5	Office building
(1) We own 95% of this project, and the cost basis above represents 100%.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 24

Summary Development Activity
March 31, 2016
			Start Date		Estimated Cost per SF
		Square feet (in thousands)		Shell Completion Date			Estimated Total Cost (in millions)		Cost to Date (in millions)
Project	Market
Domain 8 (1)	Austin	291	Q3 2015	Q1 2017	$	302	$	88.0	$	28.0
(1) We own 50% of this project, and the costs above represents 100%.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 25

Properties Under Development

Domain 8

Austin, Texas

Property Objectives

Domain 8 has an efficient design intended to accommodate single-floor and multi-tenant arrangements.

The building will seek to achieve a minimum LEED Certified Silver and will operate under Energy Star standards.

Property Description

Domain 8 is designed as a Class A office building located in The Domain, a master planned, mixed-use project located in Austin.

The building will be constructed of poured in place concrete along with a glass curtain wall system.

Property Highlights

Located in The Domain master planned, mixed-use project - a true “live, work, play” environment consisting of 1.2 million square feet of retail, 1,862 apartment units, 604 hotel rooms and 1.5 million square feet of Class A office

The Domain commands the highest Class A office rents in every submarket in Austin except the CBD

Efficient 34,000 square foot floor plates with direct elevator access to office floors from every garage level and dramatic views of The Domain and the Texas Hill Country

Walking access to a full array of amenities and hike/bike trails; on-site showers and locker room

Property Facts

Submarket	Domain/Arboretum
Floors	9 Floors Office Space/3 Floors Parking
Approximate Rentable SF	291,000
Estimated Operating Expenses per SF	$14.85
Estimated Shell Delivery Date	1Q 2017
Estimated Project Cost at Completion	$88,000,000
Percentage Owned	50	%
Percentage Leased at March 31, 2016	—	%

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 26

Acquisition and Disposition Activities
For the Twelve Months Ended March 31, 2016
		Number of Properties	Square Feet (in thousands)	Transaction Date	Price (in thousands)
Acquisitions	Location
Third + Shoal (95%) (land)	Austin, TX	N/A	N/A	6/24/2015	$	7,500
Legacy (95%) (land)	Plano, TX	N/A	N/A	6/25/2015	$	6,175
1325 G Street (10%) (1)	Washington, D.C.	1	31	6/30/2015	$	15,200
Colorado Building (10%) (1)	Washington, D.C.	1	13	6/30/2015	$	5,000
Domain 2 (49.84%)	Austin, TX	1	57	7/23/2015	$	9,240
Domain 3	Austin, TX	1	179	7/23/2015	$	46,566
Domain 4	Austin, TX	1	153	7/23/2015	$	32,867
Domain 7 (49.84%)	Austin, TX	1	111	7/23/2015	$	17,545
Domain A (land)	Austin, TX	N/A	N/A	7/23/2015	$	4,087
Domain B, C, D, G, and E (land)	Austin, TX	N/A	N/A	7/23/2015	$	52,682
Domain L, M, and N (land)	Austin, TX	N/A	N/A	7/23/2015	$	22,000
Domain K (multifamily property)	Austin, TX	N/A	N/A	10/16/2015	$	15,000
		6	544
Dispositions
Fifth Third Center	Cleveland, OH	1	508	4/7/2015	$	52,750
United Plaza	Philadelphia, PA	1	617	4/23/2015	$	114,554
1650 Arch Street	Philadelphia, PA	1	553	4/23/2015	$	76,290
1325 G Street (1)	Washington, D.C.	1	307	6/30/2015	$	152,000
Colorado Building (1)	Washington, D.C.	1	128	6/30/2015	$	50,000
Domain L, M, and N (land)	Austin, TX	N/A	N/A	7/24/2015	$	22,000
Domain K (multi-family property)	Austin, TX	N/A	N/A	10/16/2015	$	15,000
Paces West (10%)	Atlanta, GA	1	65	11/30/2015	$	11,250
Domain A (land)	Austin, TX	N/A	N/A	12/16/2015	$	4,250
Lawson Commons	St. Paul, MN	1	436	3/1/2016	$	68,430
		7	2,614
(1) In June 2015 we sold our 1325 G Street and Colorado Building properties to two separate joint ventures in which we own a 10% noncontrolling interest.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 27

Summary of Financing
March 31, 2016
(in thousands, except percentages and number of years)
					Principal			Weighted Average Effective Interest Rate	% of Total
Fixed Rate Debt
Secured mortgage debt					$	358,717		5.89%	35%
Unsecured term loans (1)					525,000			3.46%	50%
Total fixed rate debt					883,717			4.45%	85%
Variable Rate Debt
Unsecured term loan (1)					50,000			1.97%	5%
Unsecured revolving credit facility (2)					108,000			2.01%	10%
Total variable rate debt					158,000			2.00%	15%
Total debt (3)					1,041,717			4.07%	100%
unamortized debt issuance costs (4)					(8,744		)
Total notes payable, net					$	1,032,973
(1) The borrowing rate under $525.0 million of the term loans has been effectively fixed through the use of interest rate hedges. The remaining portion is variable rate.
(2) Additional borrowings of $82.8 million were available under the credit facility.
(3) As of March 31, 2016, we had a non-recourse loan in default which subjects us to incur default interest at a rate that is 500 basis points higher than the stated interest rate which results in an overall effective weighted average interest rate of 4.31%.
(4) Excludes $3.3 million of unamortized debt issuance costs associated with the revolving line of credit because those costs are presented as an asset on our consolidated balance sheet.
	Maturities
	Secured Mortgage Debt				Unsecured Revolving Credit Facility and Term Loans				Total				Annual % Maturing
	Principal			Rate (1)	Principal			Rate (1)	Principal			Rate (1)
2016	$	134,995		5.88%	$	—		—	$	134,995		5.88%	13%
2017	129,387			5.55%	—			—	129,387			5.55%	12%
2018	—			—	108,000			2.01%	108,000			2.01%	10%
2019	—			—	300,000			3.02%	300,000			3.02%	29%
2020	—			—	—			—	—			—	—
Thereafter	94,335			6.38%	275,000			3.67%	369,335			4.36%	36%
Total debt	$	358,717			$	683,000			1,041,717			4.07%
unamortized debt issuance costs									(8,744		)
Total notes payable, net									1,032,973
Weighted average maturity in years	1.9				4.6				3.7
(1) Represents weighted average effective interest rate for debt maturing in this period.
	Maturities
	Consolidated Debt				Our share of unconsolidated debt				Total				Annual % Maturing
	Principal			Rate (1)	Principal			Rate (1)	Principal			Rate (1)
2016	$	134,995		5.88%	$	24,475		2.22%	$	159,470		5.32%	14%
2017	129,387			5.55%	—			—	129,387			5.55%	12%
2018	108,000			2.01%	1,945			4.82%	109,945			2.06%	10%
2019	300,000			3.02%	—			—	300,000			3.02%	27%
2020	—			—	13,029			2.21%	13,029			2.21%	1%
Thereafter	369,335			4.36%	43,298			3.88%	412,633			4.31%	36%
Total debt	1,041,717				82,747				1,124,464			4.01%
unamortized debt issuance costs	(8,744		)		(962		)		(9,706		)
Total notes payable, net	$	1,032,973			$	81,785			$	1,114,758
Weighted average maturity in years	3.7				4.5				3.7
(1) Represents weighted average effective interest rate for debt maturing in this period.
Hedging Details:
Type/Description	Notional Value			Index	Strike Rate			Effective Date	Maturity Date			Loan Designation
Interest rate swap - cash flow hedge	$	125,000		one-month LIBOR	1.6775%			31-Dec-14	31-Oct-19			Credit Facility
Interest rate swap - cash flow hedge	$	125,000		one-month LIBOR	1.6935%			30-Apr-15	31-Oct-19			Credit Facility
Interest rate swap - cash flow hedge	$	125,000		one-month LIBOR	1.7615%			30-Jun-15	31-May-22			Credit Facility
Interest rate swap - cash flow hedge	$	150,000		one-month LIBOR	1.7695%			30-Jun-15	31-May-22			Credit Facility

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 28

	Principal Payments by Year
	as of March 31, 2016
	(in thousands, except percentages)
			Stated Interest Rate		Effective Interest Rate
		Maturity					Total			2016			2017			2018			2019			2020			Thereafter
Fifth Third Center		1-Jul-16	6.09	%	6.17	%	$	48,789		$	48,789		$	—		$	—		$	—		$	—		$	—
Plaza at MetroCenter (1)		1-Jul-16	6.06	%	6.14	%	23,156			23,156			—			—			—			—			—
Three Parkway		1-Nov-16	5.48	%	5.55	%	63,050			63,050			—			—			—			—			—
One & Two Eldridge		11-Jan-17	5.41	%	5.49	%	70,587			893			69,694			—			—			—			—
500 E. Pratt		1-May-17	5.55	%	5.63	%	58,800			—			58,800			—			—			—			—
Unsecured - Revolving Line of Credit		18-Dec-18	1.98	%	2.01	%	108,000			—			—			108,000			—			—			—
Unsecured - Term Loan		18-Dec-19	2.98	%	3.02	%	300,000			—			—			—			300,000			—			—
One BriarLake Plaza - mezzanine		1-Aug-21	9.80	%	9.94	%	14,645			78			110			121			134			144			14,058
One BriarLake Plaza		1-Aug-21	5.65	%	5.72	%	79,690			1,097			1,417			1,501			1,589			1,670			72,416
Unsecured - Term Loan		30-Jun-22	3.62	%	3.67	%	275,000			—			—			—			—			—			275,000
Total			4.02	%	4.07	%	1,041,717			$	137,063		$	130,021		$	109,622		$	301,723		$	1,814		$	361,474
unamortized debt issuance costs (2)							(8,744		)
Consolidated notes payable, net							$	1,032,973
Notes associated with investments in unconsolidated entities and excluded from the consolidated balance above (at ownership share):
Wanamaker Building - office (60%)		1-Jul-18	4.75	%	4.82	%	$	1,945		$	580		$	806		$	559		$	—		$	—		$	—
Wanamaker Building - office (60%)		7-Feb-23	3.83	%	3.88	%	43,298			675			937			974			1,013			1,049			38,650
1325 G Street (10%)		30-Jun-20	2.18	%	2.21	%	9,629			—			—			—			—			9,629			—
Colorado Building (10%)		30-Jun-20	2.18	%	2.21	%	3,400			—			—			—			—			3,400			—
Domain 2 & 7 (49.84%) (3)		1-Sep-16	2.19	%	2.22	%	24,475			24,475			—			—			—			—			—
Total			3.11	%	3.15	%	82,747			$	25,730		$	1,743		$	1,533		$	1,013		$	14,078		$	38,650
unamortized debt issuance costs							(962		)
Total unconsolidated notes payable, net							$	81,785
Total notes payable			3.96	%	4.01	%	1,124,464			$	162,793		$	131,764		$	111,155		$	302,736		$	15,892		$	400,124
unamortized debt issuance costs							(9,706		)
Total notes payable, net							$	1,114,758
% of principal payments due by year							100		%	14		%	12		%	10		%	27		%	1		%	36		%
(1)	Debt was repaid in full in April 2016.
(2)	Excludes $3.3 million of unamortized debt issuance costs associated with the revolving line of credit because those costs are presented as an asset on our consolidated balance sheet.
(3)	Debt was refinanced in April 2016. Our ownership share of the new loan is $39.9 million. The new loan bears interest at LIBOR plus 1.65%, matures in April 2019, and provides for two one-year extension options.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 29

Definitions of Non-GAAP Financial Measures

We use non-GAAP financial measures in our public filings and other public disclosures. These non-GAAP financial measures are defined below.

Funds from Operations (FFO)

Historical cost accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate diminishes predictably over time.  Since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered the presentation of operating results for real estate companies that use historical cost accounting alone to be insufficient for evaluating operating performance.  FFO is a non-GAAP financial measure that is widely recognized as a measure of a REIT’s operating performance.  We use FFO as defined by the National Association of Real Estate Investment Trusts (NAREIT) in the April 2002 “White Paper on Funds From Operations” which is net income (loss), computed in accordance with GAAP, excluding extraordinary items, as defined by GAAP, gains (or losses) from sales of property and impairments of depreciable real estate (including impairments of investments in unconsolidated entities which resulted from measurable decreases in the fair value of the depreciable real estate held by the unconsolidated entity), plus depreciation and amortization of real estate assets, and after related adjustments for unconsolidated entities and noncontrolling interests.  The determination of whether impairment charges have been incurred is based partly on anticipated operating performance and hold periods.  Estimated undiscounted cash flows from a property, derived from estimated future net rental and lease revenues, net proceeds on the sale of the property, and certain other ancillary cash flows, are taken into account in determining whether an impairment charge has been incurred.  While impairment charges for depreciable real estate are excluded from net income (loss) in the calculation of FFO as described above, impairments reflect a decline in the value of the applicable property which we may not recover.

We believe that the use of FFO, together with the required GAAP presentations, is helpful in understanding our operating performance because it excludes real estate-related depreciation and amortization, gains and losses from property dispositions, impairments of depreciable real estate assets, and extraordinary items, and as a result, when compared period to period, reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, development activities, general and administrative expenses, and interest costs, which are not immediately apparent from net income.  Factors that impact FFO include fixed costs, yields on cash held in accounts, income from portfolio properties and other portfolio assets, interest rates on debt financing, and operating expenses.

We also evaluate FFO, excluding certain items. The items excluded relate to certain non-operating activities or certain non-recurring activities that create significant FFO volatility. We believe it is useful to evaluate FFO excluding these items because it provides useful information in analyzing comparability between reporting periods and in assessing the sustainability of our operating performance.

FFO and FFO, excluding certain items, should not be considered as alternatives to net income (loss), or as indicators of our liquidity, nor are they indicative of funds available to fund our cash needs, including our ability to make distributions.  Additionally, the exclusion of impairments limits the usefulness of FFO and FFO, excluding certain items, as historical operating performance measures since an impairment charge indicates that operating performance has been permanently affected.  FFO and FFO, excluding certain items, are not useful measures in evaluating net asset value because impairments are taken into account in determining net asset value but not in determining FFO and FFO, excluding certain items.  FFO and FFO, excluding certain items, are non-GAAP measurements and should be reviewed in connection with other GAAP measurements.  Our FFO and FFO, excluding certain items, as presented may not be comparable to amounts calculated by other REITs that do not define FFO in accordance with the current NAREIT definition, or interpret it differently, or that identify and exclude different items related to non-operating activities or certain non-recurring activities.

Funds Available for Distribution (FAD)

FAD is a non-GAAP financial measure that we define as FFO, excluding fair value mark to market adjustments, non-real estate depreciation and amortization, non-cash stock-based compensation expense, accretion or dilution of of Series A preferred stock, the amortization of financing costs, realized gains (losses) from the early extinguishment of derivatives, acquisition fees and expenses, straight-line rent amounts, amortization of above- or below-market intangible assets and liabilities, gains or losses on early extinguishment of debt, costs associated with our tender offer and NYSE listing, default interest or forgiven, and other non-recurring charges, less recurring capital expenditures, each as adjusted for our pro rata share of consolidated and unconsolidated amounts. Recurring capital expenditures are those capital expenditures, tenant improvements, leasing commissions and deferred lease incentives that are incurred to maintain current in-place rents including the leasing costs incurred to replace tenants upon lease expiration. Recurring capital expenditures exclude non-recurring capital expenditures. Non-recurring capital expenditures are those capital expenditures (1) incurred to change the class or characterization of an asset, (2) identified as deferred capital needs at the acquisition of a property and were incurred within a reasonable period of time subsequent to the property’s acquisition, or (3) incurred for tenant improvements, leasing commissions, or deferred lease incentives within twelve months of acquisition to lease space that was vacant at acquisition and costs incurred to lease space that has been vacant for at least twelve months. Although our FAD may not be comparable to that of other REITs and real estate companies, we believe it provides a meaningful indicator of our ability to fund our cash needs and to make cash distributions to equity owners.

We believe that net income (loss) is the most directly comparable GAAP financial measure to FAD. FAD does not represent cash generated from operating activities in accordance with GAAP and should not be considered as an alternative to net income (loss) as an indication of our performance or to cash flows as a measure of liquidity or our ability to make distributions.

Net Operating Income (NOI)

NOI is a non-GAAP financial measure equal to rental revenue, less property operating expenses, real estate taxes, and property management expenses.   Our management uses NOI internally as a performance measure and believes NOI is useful to investors as a performance measure because NOI reflects only those income and expense items that are incurred at the property level and is therefore a useful measure for evaluating a property’s performance. Using NOI on a comparative basis allows investors to evaluate property level performance to compare the operating performance of our properties in a given market with the operating performance of other real estate companies in the same market, and consequently allocate their own investment capital accordingly.

Further, we use NOI internally as a performance measure and believe NOI is useful to investors as a performance measure because, when compared year over year, NOI reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, acquisition and development activities, and general and administrative expenses on an un-leveraged basis, providing perspective not immediately apparent from net income. NOI excludes certain components from net income in order to provide results that are more closely related to a property’s results of operations.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 30

Certain items such as interest expense, while included in net income, do not affect the operating performance of a real estate asset and are often incurred at the corporate level as opposed to the property level. In addition, it is useful to our management and investors that depreciation and amortization are excluded from NOI because historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time, and, instead, real estate values have historically risen or fallen with market conditions.

NOI presented by us may not be comparable to NOI reported by other REITs that do not define NOI exactly as we do. We believe that in order to facilitate a clear understanding of our operating results, NOI should be examined in conjunction with net income as presented in our consolidated financial statements and notes thereto. NOI should not be considered as an alternative to net income as an indication of our performance or to cash flows as a measure of liquidity or our ability to make distributions.

Same Store GAAP NOI and Same Store Cash NOI

Same Store GAAP NOI is equal to rental revenue, less lease termination fee income, property operating expenses (excluding tenant improvement demolition costs), real estate taxes, and property management expenses for our same store properties and is considered a non-GAAP financial measure. Same Store Cash NOI is equal to Same Store GAAP NOI less non-cash revenue items including straight-line rent adjustments and the amortization of above- and below-market rent. The same store properties include our operating office properties owned and operated for the entirety of both periods being compared and include our comparable ownership percentage in each period for properties in which we own an unconsolidated interest.  We view Same Store GAAP NOI and Same Store Cash NOI as important measures of the operating performance of our properties because they allow us to compare operating results of properties owned and operated for the entirety of both periods being compared and therefore eliminate variations caused by acquisitions or dispositions during such periods.

Same Store GAAP NOI and Same Store Cash NOI presented by us may not be comparable to Same Store GAAP NOI or Same Store Cash NOI reported by other REITs that do not define Same Store GAAP NOI or Same Store Cash NOI exactly as we do. We believe that in order to facilitate a clear understanding of our operating results, Same Store GAAP NOI and Same Store Cash NOI should be examined in conjunction with net income (loss) as presented in our consolidated financial statements and notes thereto. Same Store GAAP NOI and Same Store Cash NOI should not be considered as an indicator of our ability to make distributions or as alternatives to net income (loss) as an indication of our performance or to cash flows as a measure of liquidity.

Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA)

EBITDA, a non-GAAP financial measure, is defined as net income (loss), plus interest expense, income tax expense, and depreciation and amortization expense, and after related adjustments for unconsolidated partnerships, joint ventures and subsidiaries, and noncontrolling interests. EBITDA is not intended to represent cash flow for the period, is not presented as an alternative to operating income as an indicator of operating performance, should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP, and is not indicative of operating income or cash provided by operating activities as determined under GAAP. EBITDA is presented solely as a supplemental disclosure with respect to liquidity because we believe it provides useful information regarding our ability to service or incur debt.

We also evaluate Normalized EBITDA, which is EBITDA excluding certain revenues and operating expenses. The items excluded relate to certain non-operating activities or certain non-recurring activities that create significant EBITDA volatility. Further, we evaluate Normalized Estimated Full Period EBITDA, which is EBITDA excluding certain revenues and operating expenses and adjusted to show the pro forma impact of properties that were either acquired or disposed during the period. We believe it is useful to evaluate EBITDA excluding these items and as adjusted for property acquisitions and dispositions because it provides useful information in analyzing comparability between reporting periods and in assessing the sustainability of our operating performance.

Supplemental Operating and Financial Data TIER REIT 1st Quarter Page 31