Exhibit 99.1

 

GRAPHIC

 

Earnings Release & Supplemental Information — Unaudited

March 31, 2011

 

OVERVIEW:

 

Section I

Earnings Release

 

Summary Description

 

1

Research Coverage

 

2

Selected Financial Summary Data

 

3-4

FINANCIAL STATEMENTS:

 

Section II

Quarterly Consolidated Balance Sheets

 

5

Consolidated Statements of Operations

 

6

Consolidated Reconciliations of FFO and AFFO

 

7

PORTFOLIO INFORMATION:

 

Section III

Office Property Summary by Region — Wholly Owned Office Properties

 

8-13

Land Controlled

 

14

Top 20 Tenants — Wholly Owned office Properties

 

15

OPERATING STATISTICS:

 

Section IV

Renewal Analysis for Wholly Owned Office Properties

 

16

Lease Expiration Analysis for Wholly Owned Office Properties

 

17

Property Occupancy by Region by Quarter for Wholly Owned Office Properties

 

18

Real Estate Revenues & NOI by Region

 

19

Same Office Properties Average Occupancy by Region

 

20

Same Office Property Revenues & NOI by Region

 

21

INVESTING ACTIVITY:

 

Section V

Summary of Construction Projects

 

22

Summary of Development and Redevelopment Projects

 

23

Construction and Development Summary

 

24

2011 Office Property Construction Placed into Service

 

25

Construction Leasing Progression Over Previous Five Quarters

 

26

WHOLESALE DATA CENTERS:

 

Section VI

Wholesale Data Center Summary

 

27

CAPITALIZATION:

 

Section VII

Quarterly Common Equity Analysis

 

28

Quarterly Preferred Equity and Total Market Capitalization Analysis

 

29

Dividend Analysis

 

30

Debt Analysis

 

31

Debt Maturity Schedule

 

32

CAPITALIZATION:

 

Section VIII

Summary of Consolidated Joint Ventures

 

33

Summary of Unconsolidated Joint Ventures

 

34

RECONCILIATIONS & DEFINITIONS:

 

Section IX

Supplementary Reconciliations of Non-GAAP Measures

 

35-36

Definitions

 

37-40

 

Please refer to the section entitled “Definitions” for definitions of non-GAAP measures and other terms we use herein that may not be customary or commonly known.

 



 

6711 Columbia Gateway Drive, Suite 300

Columbia, Maryland 21046

Telephone 443-285-5400

Facsimile 443-285-7650

www.copt.com

NYSE: OFC

 

 

 

NEWS RELEASE

 

 

 

IR Contacts:

 

FOR IMMEDIATE RELEASE

Stephanie Krewson

Michelle Layne

 

VP, Investor Relations

Investor Relations Specialist

 

443-285-5453

443-285-5452

 

stephanie.krewson@copt.com

michelle.layne@copt.com

 

COPT REPORTS FIRST QUARTER 2011 RESULTS AND LAUNCHES

STRATEGIC REALLOCATION PLAN

 

COLUMBIA, MD April 28, 2011 — Corporate Office Properties Trust (COPT) (NYSE: OFC) today announced financial and operating results for the first quarter ended March 31, 2011. Diluted earnings per share was ($0.33) for the quarter ended March 31, 2011 as compared to $0.10 for the quarter ended March 31, 2010. Excluding a previously announced, non-cash impairment charge associated with the Company’s Fort Ritchie investment, funds from operations (FFO) per diluted share for the first quarter of 2011 was $0.52, a 2% decline from the $0.53 FFO per share reported in the first quarter of 2010. Including the impairment charge, FFO per diluted share for the quarter ended March 31, 2011 was $0.13.

 

Strategic Reallocation Plan:

COPT’s management also announced it is accelerating asset dispositions as part of a Strategic Reallocation Plan designed to increase its concentration of buildings serving the specialized needs of tenants in the U.S. Government and Defense Information Technology industries (Defense IT), and Data Centers catering to both sectors.

 

“By executing our Strategic Reallocation Plan, COPT will increase its percentage of real estate revenues serving our super core customers from 59% today, to 67% at the end of 2013,” stated Randall M. Griffin, Chief Executive Officer of Corporate Office Properties Trust. “We also will decrease our exposure to traditional suburban office buildings, which will position us to better weather future economic downturns. In short, COPT will be an even stronger, more focused company that can deliver impressive earnings growth and shareholder returns.”

 

Revised 2011 Guidance:

Management is revising its prior earnings and FFO guidance to reflect its updated outlook for the year and the near-term dilution it anticipates from assets to be sold as part of the Strategic Reallocation Plan. Details will be provided on its conference call today at 11:00 a.m. Eastern Time. Conference call details are provided later in this press release.

 

First Quarter 2011 Results:

For the first quarter ended March 31, 2011 — EPS was ($0.33) for the quarter ended March 31, 2011 as compared to $0.10 for the quarter ended March 31, 2010. Excluding a $27.7 million non-cash impairment charge associated with its investment in Fort Ritchie, FFO for the first quarter ended March 31, 2011 totaled $42.3 million, or $0.52 per diluted share. First quarter 2011 results

 



 

represent a 2% decrease on a per share basis from the $0.53 per diluted share, or $38.2 million of FFO for the first quarter of 2010. Including the impairment charge, FFO per diluted share for the first quarter of 2011 was $0.13 versus $0.53 reported in the first quarter of 2010.

 

Operating Performance:

Portfolio Summary — At March 31, 2011, the Company’s wholly-owned portfolio of 252 office properties totaled 20.2 million square feet. The weighted average remaining lease term for the portfolio was 4.9 years and the average rental rate (including tenant reimbursements) was $25.75 per square foot. The Company’s wholly-owned portfolio was 87.0% occupied and 89.2% leased as of March 31, 2011.

 

Same Office Performance — The Company’s same office portfolio for the quarter ended March 31, 2011 represents 91% of the rentable square feet of its consolidated portfolio and consists of 241 properties. For the quarter ended March 31, 2011, the Company’s same office property cash NOI decreased 5% as compared to the three months ended March 31, 2010.

 

Leasing — For the quarter ended March 31, 2011, 784,000 square feet were renewed equating to a 67% renewal rate, at an average committed cost of $10.69 per square foot. Total rent on renewed space increased 5.5% on a straight-line basis, as measured from the straight-line rent in effect preceding the renewal date, and remained flat on a cash basis. For renewed and retenanted space of 1.0 million square feet, total straight-line rent increased 4.3% and total rent on a cash basis remained flat. The average committed cost for renewed and retenanted space was $15.61 per square foot.

 

Investment Activity:

Developments — At March 31, 2011, the Company had properties totaling 3.1 million square feet under construction, development and redevelopment for a total projected cost of $672.8 million. The Company controlled land at March 31, 2011 of 2,265 acres that can support up to 21.8 million square feet of development.

 

Acquisitions — The Company did not complete any acquisitions during the first quarter 2011.

 

Balance Sheet and Financial Flexibility:

As of March 31, 2011, the Company had a total market capitalization of $5.2 billion, with $2.4 billion in debt outstanding, equating to a 46% debt-to-total market capitalization ratio. Also, the Company’s weighted average interest rate was 4.9% for the quarter ended March 31, 2011 and 82% of its debt was subject to fixed interest rates as of March 31, 2011.

 

For the first quarter 2011, the Company’s adjusted EBITDA to interest expense coverage ratio was 2.93x, and the adjusted EBITDA fixed charge coverage ratio was 2.49x. Adjusting for construction in progress, the Company’s adjusted debt-to-adjusted EBITDA ratio was 7.23x as of March 31, 2011.

 

Reconciliations of non-GAAP measures to the most directly comparable GAAP measures are included in the tables that follow the text of this press release.

 

Conference Call:

Supplemental presentation — COPT will be posting a supplemental presentation that discusses the Strategic Reallocation Plan approximately 15 minutes before its 11:00 a.m. Eastern Time conference call in the Investor Relations section of COPT’s website, www.copt.com.

 



 

Management will discuss first quarter earnings results, the details of its Strategic Reallocation Plan and its revised earnings and FFO guidance for 2011 on its conference call today at 11:00 a.m. Eastern Time, details of which are listed below:

 

Conference Call Date:

 

Thursday, April 28, 2011

 

 

 

Time:

 

11:00 a.m. Eastern Time

 

 

 

Telephone Number: (within the U.S.)

 

888-679-8034

 

 

 

Telephone Number: (outside the U.S.)

 

617-213-4847

 

 

 

Passcode:

 

18057385

 

Please use the following link to pre-register and view important information about this conference call. Pre-registering is not mandatory but is recommended as it will provide you immediate entry into the call and will facilitate the timely start of the conference. Pre-registration only takes a few moments and you may pre-register at anytime, including up to and after the call start time. To pre-register, please click on the below link:

https://www.theconferencingservice.com/prereg/key.process?key=PG9V4G73R

 

You may also pre-register in the Investor Relations section of the Company’s website at www.copt.com. Alternatively, you may be placed into the call by an operator by calling the number provided above at least 5 to 10 minutes before the start of the call. A replay of this call will be available beginning Thursday, April 28 at 2:00 p.m. Eastern Time through Thursday, May 5 at midnight Eastern Time. To access the replay within in the United States, please call 888-286-8010 and use passcode 96513809. To access the replay outside the United States, please call 617-801-6888 and use passcode 96513809.

 

The conference call will also be available via live webcast in the Investor Relations section of the Company’s website at www.copt.com. A replay of the conference call will be immediately available via webcast in the Investor Relations section of the Company’s website.

 

Definitions:

Please refer to the information furnished with our Form 8-K or our website (www.copt.com) for definitions of certain terms used in this press release. Reconciliations of non-GAAP measures to the most directly comparable GAAP measures are included in the attached tables.

 

Company Information

Corporate Office Properties Trust (COPT) (NYSE: OFC) is a specialty office real estate investment trust (REIT) that focuses primarily on strategic customer relationships and specialized tenant requirements in the U.S. Government and Defense Information Technology sectors and Data Centers serving such sectors. The Company acquires, develops, manages and leases office and data center properties that are typically concentrated in large office parks primarily located adjacent to government demand drivers and/or in strong markets that we believe possess growth opportunities. As of March 31, 2011, the Company owned 272 office properties totaling 21.3 million rentable square feet, which includes 20 properties totaling 1.1 million square feet held through joint ventures. The Company’s portfolio primarily consists of technically sophisticated buildings in visually appealing settings that are environmentally sensitive, sustainable and meet

 



 

unique customer requirements. COPT is an S&P MidCap 400 company and more information can be found at www.copt.com.

 

Forward-Looking Information

This press release may contain “forward-looking” statements, as defined in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, that are based on the Company’s current expectations, estimates and projections about future events and financial trends affecting the Company.  Forward-looking statements can be identified by the use of words such as “may,” “will,” “should,” “could,” “believe,” “anticipate,” “expect,” “estimate,” “plan” or other comparable terminology.  Forward-looking statements are inherently subject to risks and uncertainties, many of which the Company cannot predict with accuracy and some of which the Company might not even anticipate.  Accordingly, the Company can give no assurance that these expectations, estimates and projections will be achieved.  Future events and actual results may differ materially from those discussed in the forward-looking statements.

 

Important factors that may affect these expectations, estimates, and projections include, but are not limited to:

·      general economic and business conditions, which will, among other things, affect office property demand and rents, tenant creditworthiness, interest rates and financing availability;

·      adverse changes in the real estate markets including, among other things, increased competition with other companies;

·      the Company’s ability to borrow on favorable terms;

·      risks of real estate acquisition and development activities, including, among other things, risks that development projects may not be completed on schedule, that tenants may not take occupancy or pay rent or that development or operating costs may be greater than anticipated;

·      risks of investing through joint venture structures, including risks that the Company’s joint venture partners may not fulfill their financial obligations as investors or may take actions that are inconsistent with the Company’s objectives;

·      changes in our plans or views of market economic conditions or failure to obtain development rights, either of which could result in recognition of impairment losses;

·      our ability to satisfy and operate effectively under Federal income tax rules relating to real estate investment trusts and partnerships;

·      governmental actions and initiatives; and

·      environmental requirements.

 

The Company undertakes no obligation to update or supplement any forward-looking statements. For further information, please refer to the Company’s filings with the Securities and Exchange Commission, particularly the section entitled “Risk Factors” in Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2010.

 



 

Corporate Office Properties Trust

Summary Financial Data

(unaudited)

(Amounts in thousands, except per share data)

 

 

 

Three Months Ended
March 31,

 

 

 

2011

 

2010

 

Revenues

 

 

 

 

 

Real estate revenues

 

$

122,367

 

$

112,228

 

Construction contract and other service revenues

 

21,028

 

37,365

 

Total revenues

 

143,395

 

149,593

 

Expenses

 

 

 

 

 

Property operating expenses

 

50,905

 

48,135

 

Depreciation and amortization associated with real estate operations

 

33,020

 

27,596

 

Construction contract and other service expenses

 

20,618

 

36,399

 

Impairment loss

 

27,742

 

 

General and administrative expenses

 

6,777

 

5,900

 

Business development expenses

 

488

 

155

 

Total operating expenses

 

139,550

 

118,185

 

Operating income

 

3,845

 

31,408

 

Interest expense

 

(26,928

)

(22,638

)

Interest and other income

 

1,168

 

1,302

 

(Loss) income from continuing operations before equity in income (loss) of unconsolidated entities and income taxes

 

(21,915

)

10,072

 

Equity in income (loss) of unconsolidated entities

 

30

 

(205

)

Income tax benefit (expense)

 

544

 

(41

)

(Loss) income from continuing operations

 

(21,341

)

9,826

 

Discontinued operations

 

74

 

832

 

(Loss) income before gain on sales of real estate

 

(21,267

)

10,658

 

Gain on sales of real estate, net of income taxes

 

2,701

 

17

 

Net (loss) income

 

(18,566

)

10,675

 

Less net (loss) income attributable to noncontrolling interests

 

 

 

 

 

Common units in the Operating Partnership

 

1,479

 

(527

)

Preferred units in the Operating Partnership

 

(165

)

(165

)

Other consolidated entities

 

(538

)

(45

)

Net (loss) income attributable to COPT

 

(17,790

)

9,938

 

Preferred share dividends

 

(4,025

)

(4,025

)

Net (loss) income attributable to COPT common shareholders

 

$

(21,815

)

$

5,913

 

 

 

 

 

 

 

Earnings per share “EPS” computation:

 

 

 

 

 

Numerator for diluted EPS:

 

 

 

 

 

Net (loss) income attributable to common shareholders

 

$

(21,815

)

$

5,913

 

Amount allocable to restricted shares

 

(282

)

(290

)

Numerator for diluted EPS

 

(22,097

)

5,623

 

 

 

 

 

 

 

Denominator:

 

 

 

 

 

Weighted average common shares - basic

 

66,340

 

57,844

 

Dilutive effect of share-based compensation awards

 

 

364

 

Weighted average common shares - diluted

 

66,340

 

58,208

 

 

 

 

 

 

 

Diluted EPS

 

$

(0.33

)

$

0.10

 

 



 

Corporate Office Properties Trust

Summary  Financial Data

(unaudited)

(Amounts in thousands, except per share data and ratios)

 

 

 

Three Months Ended
March 31,

 

 

 

2011

 

2010

 

 

 

 

 

 

 

Net (loss) income

 

$

(18,566

)

$

10,675

 

Add: Real estate-related depreciation and amortization

 

33,020

 

27,603

 

Add: Depreciation and amortization on unconsolidated real estate entities

 

119

 

175

 

Less: Gain on sales of previously depreciated operating properties, net of income taxes

 

 

(297

)

Funds from operations (“FFO”)

 

14,573

 

38,156

 

Less: Noncontrolling interests - preferred units in the Operating Partnership

 

(165

)

(165

)

Less: Noncontrolling interests - other consolidated entities

 

(538

)

(45

)

Less: Preferred share dividends

 

(4,025

)

(4,025

)

Less: Depreciation and amortization allocable to noncontrolling interests in other consolidated entities

 

(65

)

(282

)

Less: Basic and diluted FFO allocable to restricted shares

 

(282

)

(379

)

Basic and diluted FFO available to common share and common unit holders (“Basic and diluted FFO”)

 

9,498

 

33,260

 

Less: Straight line rent adjustments

 

(3,912

)

(2,346

)

Less: Amortization of acquisition intangibles included in net operating income

 

161

 

(270

)

Less: Recurring capital expenditures

 

(14,344

)

(6,211

)

Add: Amortization of discount on Exchangeable Senior Notes, net of amounts capitalized

 

1,558

 

782

 

Add: Impairment loss

 

27,742

 

 

Add: Operating property acquisition costs

 

23

 

19

 

Diluted adjusted funds from operations available to common share and common unit holders (“Diluted AFFO”)

 

$

20,726

 

$

25,234

 

 

 

 

 

 

 

Weighted average shares

 

 

 

 

 

Weighted average common shares

 

66,340

 

57,844

 

Conversion of weighted average common units

 

4,396

 

5,017

 

Weighted average common shares/units - basic FFO per share

 

70,736

 

62,861

 

Dilutive effect of share-based compensation awards

 

261

 

364

 

Weighted average common shares/units - diluted FFO per share

 

70,997

 

63,225

 

 

 

 

 

 

 

Diluted FFO per share

 

$

0.13

 

$

0.53

 

Diluted FFO per share, as adjusted for comparability

 

$

0.52

 

$

0.53

 

Dividends/distributions per common share/unit

 

$

0.4125

 

$

0.3925

 

Diluted FFO payout ratio, as adjusted for comparability

 

79.2

%

75.2

%

Diluted AFFO payout ratio

 

142.4

%

99.2

%

Adjusted EBITDA interest coverage ratio

 

2.93

x

2.97

x

Adjusted EBITDA fixed charge coverage ratio

 

2.49

x

2.47

x

Debt to Adjusted EBITDA ratio (1)

 

8.66

x

8.54

x

Adjusted debt to Adjusted EBITDA ratio (2)

 

7.23

x

7.25

x

 

 

 

 

 

 

Reconciliation of denominators for diluted EPS and diluted FFO per share

 

 

 

 

 

Denominator for diluted EPS

 

66,340

 

58,208

 

Weighted average common units

 

4,396

 

5,017

 

Anti-dilutive EPS effect of share-based compensation awards

 

261

 

 

Denominator for diluted FFO per share

 

70,997

 

63,225

 

 


(1) Represents debt divided by Adjusted EBITDA for the three month period multiplied by four.

(2) Represents debt adjusted to subtract construction in progress as of period end divided by Adjusted EBITDA for the three month period multiplied by four.

 



 

Corporate Office Properties Trust

Summary Financial Data

(unaudited)

(Dollars and shares in thousands, except per share data)

 

 

 

March 31,

 

December 31,

 

 

 

2011

 

2010

 

Balance Sheet Data (in thousands) (as of period end)

 

 

 

 

 

Properties, net of accumulated depreciation

 

$

3,468,771

 

$

3,445,455

 

Total assets

 

3,865,809

 

3,844,517

 

Debt, net

 

2,396,795

 

2,323,681

 

Total liabilities

 

2,594,151

 

2,521,379

 

Beneficiaries’ equity

 

1,271,658

 

1,323,138

 

 

 

 

 

 

 

Debt to total assets

 

62.0

%

60.4

%

Debt to undepreciated book value of real estate assets

 

58.4

%

57.2

%

Debt to total market capitalization

 

46.0

%

46.1

%

 

 

 

 

 

 

Property Data (wholly owned office properties) (as of period end)

 

 

 

 

 

Number of operating properties owned

 

252

 

252

 

Total net rentable square feet owned (in thousands)

 

20,183

 

19,990

 

Occupancy

 

87.0

%

88.2

%

 

 

 

 

 

 

Reconciliation of denominator for debt to total assets to denominator for debt to undepreciated book value of real estate assets

 

 

 

 

 

Denominator for debt to total assets

 

$

3,865,809

 

$

3,844,517

 

Assets other than assets included in properties, net

 

(397,038

)

(399,062

)

Accumulated depreciation on real estate assets

 

526,825

 

503,032

 

Intangible assets on real estate acquisitions, net

 

106,444

 

113,735

 

Denominator for debt to undepreciated book value of real estate assets

 

$

4,102,040

 

$

4,062,222

 

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2011

 

2010

 

Reconciliation of tenant improvements and incentives, capital improvements and leasing costs for operating properties to recurring capital expenditures

 

 

 

 

 

Total tenant improvements and incentives on operating properties

 

$

13,270

 

$

4,071

 

Total capital improvements on operating properties

 

1,990

 

870

 

Total leasing costs on operating properties

 

2,736

 

1,338

 

Less: Nonrecurring tenant improvements and incentives on operating properties

 

(2,448

)

(77

)

Less: Nonrecurring capital improvements on operating properties

 

(610

)

(60

)

Less: Nonrecurring leasing costs incurred on operating properties

 

(616

)

54

 

Add: Recurring capital expenditures on operating properties held through joint ventures

 

22

 

15

 

Recurring capital expenditures

 

$

14,344

 

$

6,211

 

 



 

Corporate Office Properties Trust

Summary Financial Data

(unaudited)

(Dollars in thousands)

 

 

 

Three Months Ended
March 31,

 

 

 

2011

 

2010

 

Reconciliation of common share dividends to dividends and distributions for payout ratios

 

 

 

 

 

Common share dividends

 

$

27,704

 

$

23,160

 

Common unit distributions

 

1,809

 

1,867

 

Dividends and distributions for payout ratios

 

$

29,513

 

$

25,027

 

 

 

 

 

 

 

Reconciliation of FFO to FFO, as adjusted for comparability

 

 

 

 

 

FFO

 

$

14,573

 

$

38,156

 

Impairment loss

 

27,742

 

 

Operating property acquisition costs

 

23

 

19

 

FFO, as adjusted for comparability

 

$

42,338

 

$

38,175

 

 

 

 

 

 

 

Reconciliation of diluted FFO to diluted FFO available to common share and common unit holders, as adjusted for comparability

 

 

 

 

 

Diluted FFO

 

$

9,498

 

$

33,260

 

Impairment loss

 

27,742

 

 

Operating property acquisition costs

 

23

 

19

 

Diluted FFO available to common share and common unit holders, as adjusted for comparability

 

$

37,263

 

$

33,279

 

 

 

 

 

 

 

Reconciliation of GAAP net income to adjusted earnings before interest, income taxes, depreciation and amortization (“Adjusted EBITDA”)

 

 

 

 

 

Net income

 

$

(18,566

)

$

10,675

 

Interest expense on continuing operations

 

26,928

 

22,638

 

Interest expense on discontinued operations

 

 

65

 

Income tax (benefit) expense

 

(544

)

52

 

Real estate-related depreciation and amortization

 

33,020

 

27,603

 

Depreciation of furniture, fixtures and equipment

 

625

 

650

 

Impairment loss

 

27,742

 

 

Adjusted EBITDA

 

$

69,205

 

$

61,683

 

 

 

 

 

 

 

Reconciliation of interest expense from continuing operations to the denominators for interest coverage-Adjusted EBITDA and fixed charge coverage-Adjusted EBITDA

 

 

 

 

 

Interest expense from continuing operations

 

$

26,928

 

$

22,638

 

Interest expense from discontinued operations

 

 

65

 

Less: Amortization of deferred financing costs

 

(1,759

)

(1,126

)

Less: Amortization of discount on Exchangeable Senior Notes, net of amounts capitalized

 

(1,558

)

(782

)

Denominator for interest coverage-Adjusted EBITDA

 

23,611

 

20,795

 

Preferred share dividends

 

4,025

 

4,025

 

Preferred unit distributions

 

165

 

165

 

Denominator for fixed charge coverage-Adjusted EBITDA

 

$

27,801

 

$

24,985

 

 

 

 

 

 

 

Reconciliation of same office property net operating income to same office property cash net operating income and same office property cash net operating income, excluding gross lease termination fees

 

 

 

 

 

Same office property net operating income

 

$

62,123

 

$

64,935

 

Less: Straight-line rent adjustments

 

(3,136

)

(2,293

)

Less: Amortization of deferred market rental revenue

 

(278

)

(605

)

Same office property cash net operating income

 

$

58,709

 

$

62,037

 

Less: Lease termination fees, gross

 

(157

)

(278

)

Same office property cash net operating income, excluding gross lease termination fees

 

$

58,552

 

$

61,759

 

 

 

 

 

 

 

Reconciliation of debt, net to denominator for adjusted debt to Adjusted EBITDA ratio

 

 

 

 

 

Debt, net

 

$

2,396,795

 

$

2,107,131

 

Less: Construction in progress

 

(396,170

)

(317,283

)

Denominator for adjusted debt to Adjusted EBITDA ratio

 

$

2,000,625

 

$

1,789,848

 

 



 

First Quarter 2011

 

Top 20 Tenants

(Based on Annualized Rental Revenue of

wholly owned office properties, dollars in thousands)

 

 

 

 

 

 

 

 

Percentage of

 

Total

 

Percentage

 

Weighted

 

 

 

 

 

 

Total

 

Total

 

Annualized

 

of Total

 

Average

 

 

 

 

Number of

 

Occupied

 

Occupied

 

Rental

 

Annualized Rental

 

Remaining

 

Tenant

 

 

Leases

 

Square Feet

 

Square Feet

 

Revenue (2)

 

Revenue

 

Lease Term (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States of America

(4)

 

77

 

3,165,508

 

18.0

%

$

95,956

 

21.2

%

5.9

 

Northrop Grumman Corporation

(5)

 

16

 

1,204,210

 

6.9

%

31,957

 

7.1

%

6.5

 

Booz Allen Hamilton, Inc.

 

 

9

 

806,288

 

4.6

%

24,627

 

5.5

%

4.9

 

Computer Sciences Corporation

(5)

 

6

 

609,715

 

3.5

%

18,539

 

4.1

%

2.9

 

ITT Corporation

(5)

 

9

 

332,490

 

1.9

%

8,162

 

1.8

%

3.9

 

The MITRE Corporation

 

 

4

 

267,087

 

1.5

%

7,880

 

1.7

%

5.6

 

Wells Fargo & Company

(5)

 

6

 

216,374

 

1.2

%

7,780

 

1.7

%

7.2

 

The Aerospace Corporation

 

 

3

 

238,610

 

1.4

%

7,631

 

1.7

%

3.9

 

L-3 Communications Holdings, Inc.

(5)

 

4

 

258,192

 

1.5

%

7,521

 

1.7

%

3.0

 

CareFirst, Inc.

 

 

2

 

222,610

 

1.3

%

7,247

 

1.6

%

5.5

 

Integral Systems, Inc.

(5)

 

4

 

241,627

 

1.4

%

6,249

 

1.4

%

8.9

 

Comcast Corporation

(5)

 

7

 

308,332

 

1.8

%

6,156

 

1.4

%

2.5

 

The Boeing Company

(5)

 

6

 

196,939

 

1.1

%

5,974

 

1.3

%

3.5

 

AT&T Corporation

(5)

 

4

 

317,570

 

1.8

%

5,408

 

1.2

%

7.7

 

Ciena Corporation

 

 

5

 

270,557

 

1.5

%

5,074

 

1.1

%

2.0

 

General Dynamics Corporation

(5)

 

6

 

208,264

 

1.2

%

4,601

 

1.0

%

2.4

 

Raytheon Company

 

 

6

 

164,404

 

0.9

%

4,402

 

1.0

%

3.0

 

Unisys Corporation

 

 

1

 

156,695

 

0.9

%

4,143

 

0.9

%

9.2

 

The Johns Hopkins Institutions

(5)

 

5

 

141,403

 

0.8

%

3,634

 

0.8

%

5.6

 

Merck & Co., Inc.

 

 

2

 

225,894

 

1.3

%

2,949

 

0.7

%

1.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Top 20 Office Tenants

 

 

182

 

9,552,769

 

54.4

%

265,890

 

58.8

%

5.3

 

All remaining tenants

 

 

713

 

7,998,604

 

45.6

%

185,971

 

41.2

%

4.2

 

Total/Weighted Average

 

 

895

 

17,551,373

 

100.0

%

$

451,861

 

100.0

%

4.9

 

 


(1) Table excludes owner occupied leasing activity which represents 173,085 square feet with total annualized rental revenue of $4.0 million, and a weighted average remaining lease term of 4.9 years as of March 31, 2011.

(2) Total Annualized Rental Revenue is the monthly contractual base rent as of March 31, 2011, multiplied by 12, plus the estimated annualized expense reimbursements under existing office leases.

(3) The weighting of the lease term was computed using Total Rental Revenue.

(4) Many of our government leases are subject to early termination provisions which are customary to government leases. The weighted average remaining lease term was computed assuming no exercise of such early termination rights.

(5) Includes affiliated organizations or agencies.

 



 

First Quarter 2011

 

Summary Description

 

The Company — Corporate Office Properties Trust (the “Company” or “COPT”) is a self-managed, specialty office real estate investment trust (“REIT”). As of March 31, 2011, COPT derived 59% of its annualized rental revenue from wholly owned properties occupied primarily by tenants in the U.S. Government and/or defense information technology (“Defense IT”) sectors and data centers serving such sectors and  84% of the Company’s square footage was located in the Greater Washington/Baltimore region. At March 31, 2011, COPT’s wholly-owned portfolio of 252 office properties encompassed 20.2 million square feet and was 89.2% leased. At the same date, COPT also owns one wholesale data center that was 17% leased.

 

Corporate Strategy — Through acquiring and developing, COPT has assembled a portfolio of Class-A office parks located adjacent to knowledge-based defense installation (rather than weapons production-oriented bases) that are executing programs deemed critical to the nation’s current and future security needs. COPT also owns dedicated data centers that serve the specialized requirements of our government and Defense IT tenants and a wholesale data center.

 

Management:

Investor Relations:

Randall M. Griffin, CEO

Stephanie M. Krewson, VP of IR

Roger A. Waesche, Jr., President & COO

443-285-5453,  stephanie.krewson@copt.com

Stephen E. Riffee, EVP & CFO

 

Wayne H. Lingafelter, EVP, Development & Construction

Michelle Layne, IR Specialist

 

443-285-5452,  michelle.layne@copt.com

 

Disclosure Statement — This supplemental package contains forward-looking statements within the meaning of the Federal securities laws. Forward-looking statements can be identified by the use of words such as “may,” “will,” “should,” “could,” “believe,” “anticipate,” “expect,” “estimate,” “plan” or other comparable terminology.  Forward-looking statements are inherently subject to risks and uncertainties, many of which we cannot predict with accuracy and some of which we might not even anticipate.  Although we believe that the expectations, estimates and projections reflected in such forward-looking statements are based on reasonable assumptions at the time made, we can give no assurance that these expectations, estimates and projections will be achieved.  Future events and actual results may differ materially from those discussed in the forward-looking statements.  Important factors that may affect these expectations, estimates and projections include, but are not limited to: general economic and business conditions, which will, among other things, affect office property demand and rents, tenant creditworthiness, interest rates and financing availability; adverse changes in the real estate markets including, among other things, increased competition with other companies; our ability to borrow on favorable terms; risks of real estate acquisition and development activities, including, among other things, risks that development projects may not be completed on schedule, that tenants may not take occupancy or pay rent or that development and operating costs may be greater than anticipated; risks of investing through joint venture structures, including risks that our joint venture partners may not fulfill their financial obligations as investors or may take actions that are inconsistent with our objectives; changes in our plans for properties or views of market economic conditions or failure to obtain development rights, either of which could result in recognition of impairment losses; our ability to satisfy and operate effectively under Federal income tax rules relating to real estate investment trusts and partnerships; governmental actions and initiatives; and environmental requirements.  We undertake no obligation to update or supplement any forward-looking statements.  For further information, please refer to our filings with the Securities and Exchange Commission, particularly the section entitled “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2010.

 

1



 

First Quarter 2011

 

Research Coverage

 

EQUITY RESEARCH COVERAGE:

 

Firm

 

Analyst

 

Phone

 

Email

 

 

 

 

 

 

 

Bank of America Merrill Lynch

 

Jamie Feldman

 

646-855-5808

 

james.feldman@baml.com

BMO Capital Markets

 

Richard Anderson

 

212-885-4180

 

richard.anderson@bmo.com

Citigroup Global Markets

 

Michael Bilerman

 

212-816-1383

 

michael.bilerman@citi.com

Cowen and Company

 

Michael Gorman

 

646-562-1381

 

michael.gorman@cowen.com

Friedman Billings Ramsey & Co.

 

Sri Nagarajan

 

646-885-5429

 

snagarajan@fbr.com

Green Street Advisors

 

Michael Knott

 

949-640-8780

 

mknott@greenstreetadvisors.com

ISI Group

 

Steve Sakwa

 

212-446-9462

 

ssakwa@isigrp.com

Jeffries & Co.

 

Steve Benyik

 

212-707-6348

 

sbenyik@jefferies.com

JP Morgan

 

Anthony Paolone

 

212-622-6682

 

anthony.paolone@jpmorgan.com

Keefe, Bruyette & Woods

 

Sheila McGrath

 

212-887-7793

 

smcgrath@kbw.com

KeyBanc Capital Markets

 

Jordan Sadler

 

917-368-2280

 

jsadler@keybanccm.com

Macquarie Securities

 

Rob Stevenson

 

212-231-8068

 

rob.stevenson@macquarie.com

Raymond James

 

Bill Crow

 

727-567-2594

 

bill.crow@raymondjames.com

RBC Capital Markets

 

Dave Rodgers

 

440-715-2647

 

dave.rodgers@rbccm.com

Robert W. Baird & Co., Inc.

 

Chris Lucas

 

703-821-5780

 

crlucas@rwbaird.com

Stifel, Nicolaus & Company, Inc.

 

John Guinee

 

443-224-1307

 

jwguinee@stifel.com

Wells Fargo Securities

 

Brendan Maiorana

 

443-263-6516

 

brendan.maiorana@wachovia.com

 

With the exception of Green Street Advisors, the above-listed firms are those whose analysts publish research material on the Company and whose estimates of our FFO per share can be tracked through Thomson’s First Call Corporation. Any opinions, estimates, or forecasts the above analysts make regarding COPT’s future performance are their own and do not represent the views, estimates, or forecasts of COPT’s management.

 

2



 

First Quarter 2011

 

Selected Financial Summary Data

(in thousands, except per share data)

 

 

 

Three Months Ended

 

 

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

SUMMARY OF RESULTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI

 

$

71,536

 

$

76,694

 

$

70,724

 

$

69,847

 

$

64,700

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

69,205

 

$

79,652

 

$

66,976

 

$

65,259

 

$

61,683

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income

 

$

(18,566

)

$

16,752

 

$

8,926

 

$

9,151

 

$

10,675

 

Net (loss) income attributable to noncontrolling interests

 

776

 

(1,228

)

(94

)

(685

)

(737

)

Preferred share dividends

 

(4,025

)

(4,026

)

(4,025

)

(4,026

)

(4,025

)

Net (loss) income attributable to COPT common shareholders

 

$

(21,815

)

$

11,498

 

$

4,807

 

$

4,440

 

$

5,913

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO - per NAREIT

 

$

14,573

 

$

52,222

 

$

39,053

 

$

38,870

 

$

38,156

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO - as adjusted for comparability

 

$

42,338

 

$

52,692

 

$

41,717

 

$

39,141

 

$

38,175

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted FFO available to common share and common unit holders

 

$

9,498

 

$

47,227

 

$

34,278

 

$

33,880

 

$

33,260

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted AFFO available to common share and common unit holders

 

$

20,726

 

$

30,962

 

$

29,498

 

$

26,992

 

$

25,234

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share - diluted:

 

 

 

 

 

 

 

 

 

 

 

EPS

 

$

(0.33

)

$

0.18

 

$

0.08

 

$

0.07

 

$

0.10

 

FFO - NAREIT

 

$

0.13

 

$

0.69

 

$

0.54

 

$

0.53

 

$

0.53

 

FFO - as adjusted for comparability

 

$

0.52

 

$

0.70

 

$

0.58

 

$

0.54

 

$

0.53

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividend per common share

 

$

0.4125

 

$

0.4125

 

$

0.4125

 

$

0.3925

 

$

0.3925

 

 

 

 

 

 

 

 

 

 

 

 

 

Payout ratios:

 

 

 

 

 

 

 

 

 

 

 

Diluted FFO - as adjusted for comparability

 

79.2

%

61.7

%

71.3

%

73.2

%

75.2

%

Diluted AFFO

 

142.4

%

95.0

%

89.3

%

92.6

%

99.2

%

Diluted AFFO, as adjusted for recurring capital expenditures of properties included in disposition plan

 

111.9

%

N/A

 

N/A

 

N/A

 

N/A

 

 

CAPITALIZATION

 

 

 

 

 

 

 

 

 

 

 

Debt, net

 

$

2,396,795

 

$

2,323,681

 

$

2,468,419

 

$

2,182,375

 

$

2,107,131

 

Debt to Total Market Capitalization

 

46.0

%

46.1

%

48.6

%

45.3

%

43.1

%

Debt to Undepreciated Book Value of Real Estate Assets

 

58.4

%

57.2

%

62.5

%

59.1

%

58.5

%

Adjusted EBITDA fixed charge coverage ratio

 

2.5

x

2.9

x

2.4

x

2.4

x

2.5

x

Adjusted Debt to Adjusted EBITDA ratio

 

7.2

x

6.1

x

7.9

x

7.1

x

7.3

x

 

3



 

First Quarter 2011

 

Selected Financial Summary Data

(in thousands, except per share data)

 

 

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

PORTFOLIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Properties, gross (excluding accumlated depreciation)

 

 

 

 

 

 

 

 

 

 

 

Wholly-owned

 

$

3,883,290

 

$

3,836,982

 

$

3,718,724

 

$

3,487,527

 

$

3,402,815

 

+ Consolidated JV

 

112,306

 

111,505

 

109,644

 

107,395

 

105,393

 

Consolidated properties

 

$

3,995,596

 

$

3,948,487

 

$

3,828,368

 

$

3,594,922

 

$

3,508,208

 

 

 

 

 

 

 

 

 

 

 

 

 

# of Operating Office Properties

 

 

 

 

 

 

 

 

 

 

 

Wholly-owned

 

252

 

252

 

249

 

247

 

244

 

+ Consolidated JV

 

4

 

4

 

4

 

4

 

4

 

Consolidated properties

 

256

 

256

 

253

 

251

 

248

 

 

 

 

 

 

 

 

 

 

 

 

 

% Occupied (as percentage of annualized rent)

 

 

 

 

 

 

 

 

 

 

 

Wholly-owned

 

87.0

%

88.2

%

87.4

%

88.3

%

89.6

%

+ Consolidated JV

 

61.5

%

61.5

%

61.5

%

60.1

%

58.7

%

Consolidated properties

 

86.4

%

87.6

%

86.8

%

87.7

%

88.9

%

 

 

 

 

 

 

 

 

 

 

 

 

% Leased (as percentage of annualized rent)

 

 

 

 

 

 

 

 

 

 

 

Wholly-owned

 

89.2

%

89.5

%

88.7

%

89.3

%

90.3

%

+ Consolidated JV

 

62.8

%

62.7

%

62.7

%

62.6

%

62.7

%

Consolidated properties

 

88.6

%

88.9

%

88.1

%

88.7

%

89.6

%

 

 

 

 

 

 

 

 

 

 

 

 

Square Feet of office properties (in thousands)

 

 

 

 

 

 

 

 

 

 

 

Wholly-owned

 

20,183

 

19,990

 

19,929

 

19,487

 

18,903

 

+ Consolidated JV Square Footage

 

442

 

442

 

442

 

442

 

442

 

Consolidated Square Footage

 

20,625

 

20,432

 

20,371

 

19,929

 

19,345

 

 

 

 

 

 

 

 

 

 

 

 

 

% Square Feet in Greater Washington, DC/Baltimore Region from wholly owned properties

 

84.4

%

84.2

%

84.2

%

82.8

%

84.1

%

 

 

 

 

 

 

 

 

 

 

 

 

% of Wholly Owned Office Annualized Rental Revenue from “Strategic Tenant Properties”

 

58.8

%

58.7

%

56.5

%

54.8

%

55.9

%

 

4



 

First Quarter 2011

 

Quarterly Consolidated Balance Sheets

(dollars in thousands)

 

 

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

Assets

 

 

 

 

 

 

 

 

 

 

 

Properties, net

 

 

 

 

 

 

 

 

 

 

 

Operating properties

 

$

3,345,921

 

$

3,305,805

 

$

3,241,507

 

$

3,040,414

 

$

2,954,575

 

Land - development

 

253,505

 

256,487

 

241,937

 

234,662

 

236,350

 

Properties under construction and development, excluding associated land costs

 

396,170

 

386,195

 

344,924

 

319,846

 

317,283

 

Less: accumulated depreciation

 

(526,825

)

(503,032

)

(479,218

)

(464,408

)

(443,246

)

Total properties, net

 

3,468,771

 

3,445,455

 

3,349,150

 

3,130,514

 

3,064,962

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

12,606

 

10,102

 

11,733

 

9,879

 

10,180

 

Restricted cash and marketable securities

 

24,094

 

22,582

 

21,095

 

20,738

 

18,981

 

Accounts receivable, net

 

19,765

 

18,938

 

18,906

 

12,552

 

13,982

 

Deferred rent receivable

 

82,901

 

79,160

 

76,833

 

75,683

 

74,113

 

Intangible assets on real estate acquisitions, net

 

106,444

 

113,735

 

123,307

 

96,151

 

94,925

 

Deferred leasing and financing costs, net

 

60,479

 

60,649

 

56,568

 

55,762

 

50,974

 

Prepaid expenses and other assets

 

90,749

 

93,896

 

79,780

 

66,004

 

70,235

 

Total assets

 

$

3,865,809

 

$

3,844,517

 

$

3,737,372

 

$

3,467,283

 

$

3,398,352

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and equity

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

Debt, net

 

$

2,396,795

 

$

2,323,681

 

$

2,468,419

 

$

2,182,375

 

$

2,107,131

 

Accounts payable and accrued expenses

 

103,043

 

99,699

 

88,461

 

84,164

 

86,650

 

Rents received in advance and security deposits

 

29,427

 

31,603

 

26,919

 

28,328

 

32,575

 

Dividends and distributions payable

 

33,048

 

32,986

 

29,899

 

28,580

 

28,556

 

Deferred revenue associated with operating leases

 

13,897

 

14,802

 

15,790

 

12,929

 

13,827

 

Distributions received in excess of investment in unconsolidated real estate joint venture

 

5,686

 

5,545

 

5,458

 

5,351

 

5,238

 

Other liabilities

 

12,255

 

13,063

 

12,698

 

13,990

 

13,836

 

Total liabilities

 

2,594,151

 

2,521,379

 

2,647,644

 

2,355,717

 

2,287,813

 

 

 

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

 

 

 

 

COPT’s shareholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

Preferred shares (aggregate liquidation preference of $216,333)

 

81

 

81

 

81

 

81

 

81

 

Common shares

 

671

 

669

 

594

 

593

 

589

 

Additional paid-in capital

 

1,511,638

 

1,511,844

 

1,271,363

 

1,269,142

 

1,244,046

 

Cumulative distributions in excess of net income

 

(331,313

)

(281,794

)

(265,695

)

(246,008

)

(227,189

)

Accumulated other comprehensive loss

 

(3,197

)

(4,163

)

(4,861

)

(4,263

)

(3,278

)

Total COPT’s shareholders’ equity

 

1,177,880

 

1,226,637

 

1,001,482

 

1,019,545

 

1,014,249

 

Noncontrolling interests in subsidiaries

 

 

 

 

 

 

 

 

 

 

 

Common units in the Operating Partnership

 

66,016

 

69,337

 

61,867

 

63,675

 

68,113

 

Preferred units in the Operating Partnership

 

8,800

 

8,800

 

8,800

 

8,800

 

8,800

 

Other consolidated entities

 

18,962

 

18,364

 

17,579

 

19,546

 

19,377

 

Total noncontrolling interests in subsidiaries

 

93,778

 

96,501

 

88,246

 

92,021

 

96,290

 

Total equity

 

1,271,658

 

1,323,138

 

1,089,728

 

1,111,566

 

1,110,539

 

Total liabilities and equity

 

$

3,865,809

 

$

3,844,517

 

$

3,737,372

 

$

3,467,283

 

$

3,398,352

 

 

5



 

First Quarter 2011

 

Consolidated Statements of Operations

(in thousands, except per share data)

 

 

 

Three Months Ended

 

 

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

Rental revenue

 

$

99,426

 

$

100,584

 

$

93,345

 

$

91,173

 

$

91,010

 

Tenant recoveries and other real estate operations revenue

 

22,941

 

23,181

 

21,205

 

18,084

 

21,218

 

Construction contract and other service revenues

 

21,028

 

27,637

 

13,608

 

26,065

 

37,365

 

Total revenues

 

143,395

 

151,402

 

128,158

 

135,322

 

149,593

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

Property operating expenses

 

50,905

 

47,019

 

44,260

 

40,005

 

48,135

 

Depreciation and amortization associated with real estate operations

 

33,020

 

35,347

 

30,745

 

29,548

 

27,596

 

Construction contract and other service expenses

 

20,618

 

27,154

 

13,347

 

25,402

 

36,399

 

Impairment loss

 

27,742

 

 

 

 

 

General and administrative expenses

 

6,777

 

6,103

 

6,079

 

5,926

 

5,900

 

Business development expenses

 

488

 

691

 

2,886

 

465

 

155

 

Total operating expenses

 

139,550

 

116,314

 

97,317

 

101,346

 

118,185

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

3,845

 

35,088

 

30,841

 

33,976

 

31,408

 

Interest expense

 

(26,928

)

(26,878

)

(26,537

)

(25,812

)

(22,638

)

Interest and other income

 

1,168

 

7,626

 

395

 

245

 

1,302

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) income from continuing operations before equity in income (loss) of unconsolidated entities and income taxes

 

(21,915

)

15,836

 

4,699

 

8,409

 

10,072

 

Equity in income (loss) of unconsolidated entities

 

30

 

1,005

 

648

 

(72

)

(205

)

Income tax benefit (expense)

 

544

 

(33

)

(27

)

(7

)

(41

)

(Loss) income from continuing operations

 

(21,341

)

16,808

 

5,320

 

8,330

 

9,826

 

Discontinued operations

 

74

 

(56

)

1,129

 

486

 

832

 

(Loss) income before gain on sales of real estate

 

(21,267

)

16,752

 

6,449

 

8,816

 

10,658

 

Gain on sales of real estate, net of income taxes

 

2,701

 

 

2,477

 

335

 

17

 

Net (loss) income

 

(18,566

)

16,752

 

8,926

 

9,151

 

10,675

 

Less net (loss) income attributable to noncontrolling interests

 

 

 

 

 

 

 

 

 

 

 

Common units in the Operating Partnership

 

1,479

 

(862

)

(363

)

(364

)

(527

)

Preferred units in the Operating Partnership

 

(165

)

(165

)

(165

)

(165

)

(165

)

Other consolidated entities

 

(538

)

(201

)

434

 

(156

)

(45

)

Net (loss) income attributable to COPT

 

(17,790

)

15,524

 

8,832

 

8,466

 

9,938

 

Preferred share dividends

 

(4,025

)

(4,026

)

(4,025

)

(4,026

)

(4,025

)

Net (loss) income attributable to COPT common shareholders

 

$

(21,815

)

$

11,498

 

$

4,807

 

$

4,440

 

$

5,913

 

 

 

 

 

 

 

 

 

 

 

 

 

For diluted EPS computations:

 

 

 

 

 

 

 

 

 

 

 

Numerator for diluted EPS

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income attributable to common shareholders

 

$

(21,815

)

$

11,498

 

$

4,807

 

$

4,440

 

$

5,913

 

Amount allocable to restricted shares

 

(282

)

(264

)

(267

)

(250

)

(290

)

Numerator for diluted EPS

 

$

(22,097

)

$

11,234

 

$

4,540

 

$

4,190

 

$

5,623

 

 

 

 

 

 

 

 

 

 

 

 

 

Denominator:

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares - basic

 

66,340

 

63,404

 

58,656

 

58,489

 

57,844

 

Dilutive effect of share-based compensation awards

 

 

236

 

296

 

421

 

364

 

Weighted average common shares - diluted

 

66,340

 

63,640

 

58,952

 

58,910

 

58,208

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted EPS

 

$

(0.33

)

$

0.18

 

$

0.08

 

$

0.07

 

$

0.10

 

 

6



 

First Quarter 2011

 

Consolidated Reconciliations of FFO and AFFO

(in thousands, except per share data)

 

 

 

Three Months Ended

 

 

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

Net operating income

 

$

71,536

 

$

76,694

 

$

70,724

 

$

69,847

 

$

64,700

 

General and administrative expenses

 

(6,777

)

(6,103

)

(6,079

)

(5,926

)

(5,900

)

Business development expenses

 

(488

)

(691

)

(2,886

)

(465

)

(155

)

Income from construction contracts and other service operations

 

410

 

483

 

261

 

663

 

966

 

Impairment loss

 

(27,742

)

 

 

 

 

Equity in income (loss) of unconsolidated entities

 

30

 

1,005

 

648

 

(72

)

(205

)

Depreciation and amortization on unconsolidated real estate entities

 

119

 

119

 

166

 

171

 

175

 

Interest and other income

 

1,168

 

7,626

 

395

 

245

 

1,302

 

Gain on sales of real estate, net of income taxes

 

2,701

 

 

2,477

 

335

 

17

 

Total interest expense

 

(26,928

)

(26,878

)

(26,626

)

(25,921

)

(22,703

)

Income tax benefit (expense)

 

544

 

(33

)

(27

)

(7

)

(41

)

FFO - per NAREIT

 

14,573

 

52,222

 

39,053

 

38,870

 

38,156

 

Preferred share dividends

 

(4,025

)

(4,026

)

(4,025

)

(4,026

)

(4,025

)

Noncontrolling interests - preferred units in the Operating Partnership

 

(165

)

(165

)

(165

)

(165

)

(165

)

Noncontrolling interests - other consolidated entities

 

(538

)

(201

)

434

 

(156

)

(45

)

Depreciation and amortization allocable to noncontrolling interests in other consolidated entities

 

(65

)

(157

)

(666

)

(297

)

(282

)

Basic and diluted FFO allocable to restricted shares

 

(282

)

(446

)

(353

)

(346

)

(379

)

Basic and diluted FFO available to common share and common unit holders

 

$

9,498

 

$

47,227

 

$

34,278

 

$

33,880

 

$

33,260

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO - per NAREIT

 

$

14,573

 

$

52,222

 

$

39,053

 

$

38,870

 

$

38,156

 

Depreciation and amortization

 

(33,020

)

(35,347

)

(30,745

)

(29,548

)

(27,603

)

Gain on sales of previously depreciated operating properties, net of income taxes

 

 

(4

)

784

 

 

297

 

Depreciation and amortization on unconsolidated real estate entities

 

(119

)

(119

)

(166

)

(171

)

(175

)

Net (loss) income

 

(18,566

)

16,752

 

8,926

 

9,151

 

10,675

 

Noncontrolling interests - common units in the Operating Partnership

 

1,479

 

(862

)

(363

)

(364

)

(527

)

Noncontrolling interests - preferred units in the Operating Partnership

 

(165

)

(165

)

(165

)

(165

)

(165

)

Noncontrolling interests - other consolidated entities

 

(538

)

(201

)

434

 

(156

)

(45

)

Net (loss) income attributable to COPT

 

$

(17,790

)

$

15,524

 

$

8,832

 

$

8,466

 

$

9,938

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted FFO available to common share and common unit holders

 

$

9,498

 

$

47,227

 

$

34,278

 

$

33,880

 

$

33,260

 

Straight line rent adjustments

 

(3,912

)

(2,047

)

1,267

 

(1,473

)

(2,346

)

Amortization of acquisition intangibles included in NOI

 

161

 

(231

)

(96

)

(94

)

(270

)

Recurring capital expenditures

 

(14,344

)

(15,960

)

(10,156

)

(7,080

)

(6,211

)

Amortization of discount on Exchangeable Senior Notes, net of amounts capitalized

 

1,558

 

1,503

 

1,541

 

1,488

 

782

 

Impairment loss

 

27,742

 

 

 

 

 

Operating property acquisition costs

 

23

 

470

 

2,664

 

271

 

19

 

Diluted AFFO available to common share and common unit holders (“diluted AFFO”)

 

$

20,726

 

$

30,962

 

$

29,498

 

$

26,992

 

$

25,234

 

Recurring capital expenditures on properties included in April 2011 disposition plan

 

5,655

 

 

 

 

 

 

 

 

 

Diluted AFFO, as adjusted for recurring capital expenditures of properties included in disposition plan

 

$

26,381

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO - per NAREIT

 

$

14,573

 

$

52,222

 

$

39,053

 

$

38,870

 

$

38,156

 

Operating property acquisition costs

 

23

 

470

 

2,664

 

271

 

19

 

Impairment loss

 

27,742

 

 

 

 

 

FFO- as adjusted for comparability

 

$

42,338

 

$

52,692

 

$

41,717

 

$

39,141

 

$

38,175

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted FFO available to common share and common unit holders

 

$

9,498

 

$

47,227

 

$

34,278

 

$

33,880

 

$

33,260

 

Operating property acquisition costs

 

23

 

470

 

2,664

 

271

 

19

 

Impairment loss

 

27,742

 

 

 

 

 

Diluted FFO available to common share and common unit holders, as adjusted for comparability

 

$

37,263

 

$

47,697

 

$

36,942

 

$

34,151

 

$

33,279

 

 

7



 

Office Property Summary by Region - March 31, 2011

Wholly Owned Properties

 

Operating
Property
Count

 

 

 

Submarket

 

Business Park

 

Year Built or
Renovated

 

S or M

 

Total
Operational
Square Feet

 

Total Square Feet
Under
Construction /
Redevelopment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore /Washington Corridor

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

2730 Hercules Road

 

BWI Airport

 

NBP

 

1990

 

M

 

238,007

 

 

 

2

 

300 Sentinel Drive (300 NBP)

 

BWI Airport

 

NBP

 

2009

 

M

 

193,430

 

 

 

3

 

304 Sentinel Drive (304 NBP)

 

BWI Airport

 

NBP

 

2005

 

M

 

162,483

 

 

 

4

 

2720 Technology Drive (220 NBP)

 

BWI Airport

 

NBP

 

2004

 

M

 

158,929

 

 

 

5

 

306 Sentinel Drive (306 NBP)

 

BWI Airport

 

NBP

 

2006

 

M

 

155,367

 

 

 

6

 

302 Sentinel Drive (302 NBP)

 

BWI Airport

 

NBP

 

2007

 

M

 

153,535

 

 

 

7

 

2711 Technology Drive (211 NBP)

 

BWI Airport

 

NBP

 

2002

 

M

 

152,209

 

 

 

8

 

308 Sentinel Drive (308 NBP)

 

BWI Airport

 

NBP

 

2010

 

M

 

151,207

 

 

 

9

 

318 Sentinel Way (318 NBP)

 

BWI Airport

 

NBP

 

2005

 

M

 

125,635

 

 

 

10

 

322 Sentinel Way (322 NBP)

 

BWI Airport

 

NBP

 

2006

 

M

 

125,487

 

 

 

11

 

320 Sentinel Way (320 NBP)

 

BWI Airport

 

NBP

 

2007

 

M

 

125,325

 

 

 

12

 

324 Sentinel Way (324 NBP)

 

BWI Airport

 

NBP

 

2010

 

M

 

125,118

 

 

 

13

 

140 National Business Parkway

 

BWI Airport

 

NBP

 

2003

 

M

 

119,466

 

 

 

14

 

132 National Business Parkway

 

BWI Airport

 

NBP

 

2000

 

M

 

118,150

 

 

 

15

 

2721 Technology Drive (221 NBP)

 

BWI Airport

 

NBP

 

2000

 

M

 

117,242

 

 

 

16

 

2701 Technology Drive (201 NBP)

 

BWI Airport

 

NBP

 

2001

 

M

 

117,068

 

 

 

17

 

2691 Technology Drive (191 NBP)

 

BWI Airport

 

NBP

 

2005

 

M

 

103,578

 

 

 

18

 

134 National Business Parkway

 

BWI Airport

 

NBP

 

1999

 

M

 

92,327

 

 

 

19

 

133 National Business Parkway

 

BWI Airport

 

NBP

 

1997

 

M

 

88,057

 

 

 

20

 

141 National Business Parkway

 

BWI Airport

 

NBP

 

1990

 

M

 

87,364

 

 

 

21

 

135 National Business Parkway

 

BWI Airport

 

NBP

 

1998

 

M

 

86,437

 

 

 

22

 

131 National Business Parkway

 

BWI Airport

 

NBP

 

1990

 

M

 

69,702

 

 

 

23

 

114 National Business Parkway

 

BWI Airport

 

NBP

 

2002

 

S

 

10,113

 

 

 

24

 

314 Sentinel Way (314 NBP)

 

BWI Airport

 

NBP

 

2008

 

S

 

4,462

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,880,698

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

1550 West Nursery Road

 

BWI Airport

 

APS

 

2009

 

M

 

161,689

 

 

 

2

 

1306 Concourse Drive

 

BWI Airport

 

APS

 

1990

 

M

 

116,259

 

 

 

3

 

920 Elkridge Landing Road

 

BWI Airport

 

APS

 

1982

 

M

 

103,415

 

 

 

4

 

1304 Concourse Drive

 

BWI Airport

 

APS

 

2002

 

M

 

101,124

 

 

 

5

 

900 Elkridge Landing Road

 

BWI Airport

 

APS

 

1982

 

M

 

101,005

 

 

 

6

 

1199 Winterson Road

 

BWI Airport

 

APS

 

1988

 

M

 

100,104

 

 

 

7

 

880 Elkridge Landing Road

 

BWI Airport

 

APS

 

1981

 

M

 

99,646

 

 

 

8

 

1302 Concourse Drive

 

BWI Airport

 

APS

 

1996

 

M

 

83,717

 

 

 

9

 

881 Elkridge Landing Road

 

BWI Airport

 

APS

 

1986

 

M

 

75,385

 

 

 

10

 

1099 Winterson Road

 

BWI Airport

 

APS

 

1988

 

M

 

71,675

 

 

 

11

 

849 International Drive

 

BWI Airport

 

APS

 

1988

 

M

 

69,018

 

 

 

12

 

1190 Winterson Road

 

BWI Airport

 

APS

 

1987

 

M

 

69,016

 

 

 

13

 

911 Elkridge Landing Road

 

BWI Airport

 

APS

 

1985

 

M

 

68,373

 

 

 

14

 

1201 Winterson Road

 

BWI Airport

 

APS

 

1985

 

M

 

67,903

 

 

 

15

 

999 Corporate Boulevard

 

BWI Airport

 

APS

 

2000

 

M

 

67,203

 

 

 

16

 

891 Elkridge Landing Road

 

BWI Airport

 

APS

 

1984

 

M

 

57,987

 

 

 

17

 

901 Elkridge Landing Road

 

BWI Airport

 

APS

 

1984

 

M

 

57,872

 

 

 

18

 

800 International Drive

 

BWI Airport

 

APS

 

1988

 

S

 

57,379

 

 

 

19

 

930 International Drive

 

BWI Airport

 

APS

 

1986

 

S

 

57,263

 

 

 

20

 

900 International Drive

 

BWI Airport

 

APS

 

1986

 

S

 

57,140

 

 

 

21

 

921 Elkridge Landing Road

 

BWI Airport

 

APS

 

1983

 

M

 

56,452

 

 

 

22

 

938 Elkridge Landing Road

 

BWI Airport

 

APS

 

1984

 

M

 

56,270

 

 

 

23

 

939 Elkridge Landing Road

 

BWI Airport

 

APS

 

1983

 

M

 

54,224

 

 

 

24

 

870 Elkridge Landing Road

 

BWI Airport

 

APS

 

1981

 

S

 

5,810

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,815,929

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

7240 Parkway Drive

 

BWI Airport

 

Comm./Pkwy.

 

1985

 

M

 

74,475

 

 

 

2

 

7467 Ridge Road

 

BWI Airport

 

Comm./Pkwy.

 

1990

 

M

 

74,009

 

 

 

3

 

7272 Park Circle Drive

 

BWI Airport

 

Comm./Pkwy.

 

1991/1996

 

M

 

60,041

 

 

 

4

 

7318 Parkway Drive

 

BWI Airport

 

Comm./Pkwy.

 

1984

 

S

 

59,204

 

 

 

5

 

7320 Parkway Drive

 

BWI Airport

 

Comm./Pkwy.

 

1983

 

S

 

56,964

 

 

 

6

 

1340 Ashton Road

 

BWI Airport

 

Comm./Pkwy.

 

1989

 

S

 

45,867

 

 

 

7

 

1362 Mellon Road

 

BWI Airport

 

Comm./Pkwy.

 

2006

 

M

 

43,232

 

 

 

8

 

1334 Ashton Road

 

BWI Airport

 

Comm./Pkwy.

 

1989

 

S

 

37,305

 

 

 

9

 

1331 Ashton Road

 

BWI Airport

 

Comm./Pkwy.

 

1989

 

S

 

28,906

 

 

 

10

 

1350 Dorsey Road

 

BWI Airport

 

Comm./Pkwy.

 

1989

 

S

 

18,704

 

 

 

11

 

1344 Ashton Road

 

BWI Airport

 

Comm./Pkwy.

 

1989

 

M

 

17,066

 

 

 

12

 

1341 Ashton Road

 

BWI Airport

 

Comm./Pkwy.

 

1989

 

S

 

15,314

 

 

 

13

 

1343 Ashton Road

 

BWI Airport

 

Comm./Pkwy.

 

1989

 

S

 

9,903

 

 

 

14

 

1348 Ashton Road

 

BWI Airport

 

Comm./Pkwy.

 

1988

 

S

 

3,184

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

544,174

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

62

 

Subtotal (continued on next page)

 

 

 

 

 

 

 

 

 

5,240,801

 

 

 

The S or M notation indicates single story or multi-story, respectively.

 

8


 


 

Office Property Summary by Region - March 31, 2011

Wholly Owned Properties

 

Operating
Property
Count

 

 

 

Submarket

 

Business Park

 

Year Built or
Renovated

 

S or M

 

Total
Operational
Square Feet

 

Total Square Feet
Under
Construction /
Redevelopment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

62

 

Subtotal (continued from prior page)

 

 

 

 

 

 

 

 

 

5,240,801

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

5520 Research Park Drive (UMBC) (1)

 

BWI Airport

 

bwtech@UMBC

 

2009

 

M

 

103,333

 

 

 

2

 

5522 Research Park Drive (UMBC) (1)

 

BWI Airport

 

bwtech@UMBC

 

2007

 

S

 

23,925

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

127,258

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

2500 Riva Road

 

Annapolis

 

 

 

2000

 

M

 

155,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

Old Annapolis Road

 

Howard Co. Perimeter

 

Oakland Ridge

 

1985

 

M

 

171,436

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

7125 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1973/1999

 

M

 

470,249

 

 

 

2

 

7000 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1999

 

M

 

145,386

 

 

 

3

 

6721 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2009

 

M

 

131,451

 

 

 

4

 

6711 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2006-2007

 

M

 

124,090

 

 

 

5

 

6731 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2002

 

M

 

123,576

 

 

 

6

 

6950 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1998

 

M

 

112,861

 

 

 

7

 

6940 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1999

 

M

 

108,652

 

 

 

8

 

7067 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2001

 

M

 

85,393

 

 

 

9

 

8621 Robert Fulton Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2005-2006

 

M

 

83,734

 

 

 

10

 

6700 Alexander Bell Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1988

 

M

 

76,358

 

 

 

11

 

6750 Alexander Bell Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2001

 

M

 

75,328

 

 

 

12

 

6740 Alexander Bell Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1992

 

M

 

63,161

 

 

 

13

 

7015 Albert Einstein Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1999

 

S

 

62,216

 

 

 

14

 

8671 Robert Fulton Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2002

 

S

 

55,688

 

 

 

15

 

6716 Alexander Bell Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1990

 

M

 

52,114

 

 

 

16

 

8661 Robert Fulton Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2002

 

S

 

48,666

 

 

 

17

 

7142 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1994

 

S

 

47,668

 

 

 

18

 

7130 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1989

 

S

 

45,882

 

 

 

19

 

6708 Alexander Bell Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1988

 

M

 

39,128

 

 

 

20

 

7065 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2000

 

S

 

38,560

 

 

 

21

 

7138 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1990

 

S

 

38,285

 

 

 

22

 

7063 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2000

 

S

 

36,295

 

 

 

23

 

6760 Alexander Bell Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1991

 

M

 

36,227

 

 

 

24

 

7150 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1991

 

S

 

34,734

 

 

 

25

 

7061 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2000

 

M

 

30,730

 

 

 

26

 

6724 Alexander Bell Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2001

 

M

 

28,107

 

 

 

27

 

7134 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

1990

 

S

 

21,931

 

 

 

28

 

6741 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Columbia Gateway

 

2008

 

S

 

4,592

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,221,062

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

7200 Riverwood Drive

 

Howard Co. Perimeter

 

Rivers Corporate Park

 

1986

 

S

 

160,000

 

 

 

2

 

7160 Riverwood Drive

 

Howard Co. Perimeter

 

Rivers Corporate Park

 

2000

 

M

 

62,041

 

 

 

3

 

9140 Guilford Road

 

Howard Co. Perimeter

 

Rivers Corporate Park

 

1983

 

S

 

40,288

 

 

 

4

 

7150 Riverwood Drive

 

Howard Co. Perimeter

 

Rivers Corporate Park

 

2000

 

M

 

39,496

 

 

 

5

 

9160 Guilford Road

 

Howard Co. Perimeter

 

Rivers Corporate Park

 

1984

 

M

 

36,919

 

 

 

6

 

7170 Riverwood Drive

 

Howard Co. Perimeter

 

Rivers Corporate Park

 

2000

 

M

 

27,891

 

 

 

7

 

9150 Guilford Road

 

Howard Co. Perimeter

 

Rivers Corporate Park

 

1984

 

S

 

18,405

 

 

 

8

 

10280 Old Columbia Road

 

Howard Co. Perimeter

 

Rivers Corporate Park

 

1988/2001

 

S

 

16,145

 

 

 

9

 

10270 Old Columbia Road

 

Howard Co. Perimeter

 

Rivers Corporate Park

 

1988/2001

 

S

 

15,914

 

 

 

10

 

9130 Guilford Road

 

Howard Co. Perimeter

 

Rivers Corporate Park

 

1984

 

S

 

13,647

 

 

 

11

 

10290 Old Columbia Road

 

Howard Co. Perimeter

 

Rivers Corporate Park

 

1988/2001

 

S

 

10,229

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

440,975

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

9720 Patuxent Woods Drive

 

Howard Co. Perimeter

 

Owen Brown South

 

1986/2001

 

M

 

39,481

 

 

 

2

 

9740 Patuxent Woods Drive

 

Howard Co. Perimeter

 

Owen Brown South

 

1986/2001

 

M

 

37,520

 

 

 

3

 

9700 Patuxent Woods Drive

 

Howard Co. Perimeter

 

Owen Brown South

 

1986/2001

 

M

 

31,117

 

 

 

4

 

9730 Patuxent Woods Drive

 

Howard Co. Perimeter

 

Owen Brown South

 

1986/2001

 

M

 

30,495

 

 

 

5

 

9710 Patuxent Woods Drive

 

Howard Co. Perimeter

 

Owen Brown South

 

1986/2001

 

M

 

14,778

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

153,391

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

9020 Mendenhall Court

 

Howard Co. Perimeter

 

Sieling Business Park

 

1982/2005

 

S

 

47,603

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

111

 

Total Baltimore/Washington Corridor

 

 

 

 

 

 

 

8,557,526

 

 

 

The S or M notation indicates single story or multi-story building, respectively.

 


(1) This property is a land-lease property.

 

9


 


 

Office Property Summary by Region - March 31, 2011

Wholly Owned Properties

 

Operating
Property
Count

 

 

 

Submarket

 

Business Park

 

Year Built or
Renovated

 

S or M

 

Total
Operational
Square Feet

 

Total Square Feet
Under
Construction /
Redevelopment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

St. Mary’s & King George Counties

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

22309 Exploration Drive

 

St. Mary’s County

 

Exploration Park

 

1984/1997

 

M

 

98,860

 

 

 

2

 

22289 Exploration Drive

 

St. Mary’s County

 

Exploration Park

 

2000

 

M

 

58,633

 

 

 

3

 

22299 Exploration Drive

 

St. Mary’s County

 

Exploration Park

 

1998

 

M

 

58,132

 

 

 

4

 

22300 Exploration Drive

 

St. Mary’s County

 

Exploration Park

 

1997

 

M

 

45,093

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

260,718

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

46591 Expedition Drive

 

St. Mary’s County

 

Expedition Park

 

2005-2006

 

M

 

59,843

 

 

 

2

 

46579 Expedition Drive

 

St. Mary’s County

 

Expedition Park

 

2002

 

M

 

58,989

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

118,832

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

44425 Pecan Court

 

St. Mary’s County

 

Wildewood Tech Park

 

1997

 

M

 

58,694

 

 

 

2

 

44408 Pecan Court

 

St. Mary’s County

 

Wildewood Tech Park

 

1986

 

S

 

49,808

 

 

 

3

 

23535 Cottonwood Parkway

 

St. Mary’s County

 

Wildewood Tech Park

 

1984

 

M

 

46,656

 

 

 

4

 

44417 Pecan Court

 

St. Mary’s County

 

Wildewood Tech Park

 

1989

 

S

 

29,053

 

 

 

5

 

44414 Pecan Court

 

St. Mary’s County

 

Wildewood Tech Park

 

1986

 

S

 

25,444

 

 

 

6

 

44420 Pecan Court

 

St. Mary’s County

 

Wildewood Tech Park

 

1989

 

S

 

25,338

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

234,993

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

16480 Commerce Drive

 

King George County

 

Dahlgren Technology Center

 

2000

 

M

 

70,875

 

 

 

2

 

16541 Commerce Drive

 

King George County

 

Dahlgren Technology Center

 

1996

 

S

 

37,292

 

 

 

3

 

16539 Commerce Drive

 

King George County

 

Dahlgren Technology Center

 

1990

 

S

 

32,257

 

 

 

4

 

16442 Commerce Drive

 

King George County

 

Dahlgren Technology Center

 

2002

 

S

 

25,606

 

 

 

5

 

16501 Commerce Drive

 

King George County

 

Dahlgren Technology Center

 

2002

 

S

 

22,833

 

 

 

6

 

16543 Commerce Drive

 

King George County

 

Dahlgren Technology Center

 

2002

 

S

 

17,286

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

206,149

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18

 

Total St. Mary’s & King George Counties

 

 

 

 

 

 

 

 

 

820,692

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Northern Virginia

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

15000 Conference Center Drive

 

Dulles South

 

Westfields Corporate Center

 

1989

 

M

 

471,440

 

 

 

2

 

15010 Conference Center Drive

 

Dulles South

 

Westfields Corporate Center

 

2006

 

M

 

223,610

 

 

 

3

 

15049 Conference Center Drive

 

Dulles South

 

Westfields Corporate Center

 

1997

 

M

 

145,706

 

 

 

4

 

15059 Conference Center Drive

 

Dulles South

 

Westfields Corporate Center

 

2000

 

M

 

145,224

 

 

 

5

 

14900 Conference Center Drive

 

Dulles South

 

Westfields Corporate Center

 

1999

 

M

 

126,158

 

 

 

6

 

14280 Park Meadow Drive

 

Dulles South

 

Westfields Corporate Center

 

1999

 

M

 

114,409

 

 

 

7

 

4851 Stonecroft Boulevard

 

Dulles South

 

Westfields Corporate Center

 

2004

 

M

 

88,099

 

 

 

8

 

14850 Conference Center Drive

 

Dulles South

 

Westfields Corporate Center

 

2000

 

M

 

72,194

 

 

 

9

 

14840 Conference Center Drive

 

Dulles South

 

Westfields Corporate Center

 

2000

 

M

 

69,938

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,456,778

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

13200 Woodland Park Road

 

Herndon

 

Woodland Park

 

2002

 

M

 

396,837

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

13454 Sunrise Valley Road

 

Herndon

 

Dulles Tech

 

1998

 

M

 

111,974

 

 

 

2

 

13450 Sunrise Valley Road

 

Herndon

 

Dulles Tech

 

1998

 

M

 

53,379

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

165,353

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

3120 Fairview Park Drive

 

Herndon

 

Fairview Park

 

2008

 

M

 

42,910

 

140,530

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

1751 Pinnacle Drive

 

Tysons Corner

 

 

 

1989/1995

 

M

 

260,469

 

 

 

2

 

1753 Pinnacle Drive

 

Tysons Corner

 

 

 

1976/2004

 

M

 

186,707

 

 

 

3

 

1550 Westbranch Drive

 

Tysons Corner

 

 

 

2002

 

M

 

160,461

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

607,637

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

2900 Towerview Road

 

Route 28 South

 

Renaissance Park

 

1982/2008

 

M

 

139,802

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

17

 

Total Northern Virginia

 

 

 

 

 

 

 

 

 

2,809,317

 

140,530

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

11751 Meadowville Lane

 

Richmond Southwest

 

Meadowville Technology Park

 

2007

 

M

 

193,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

201 Technology Park Drive

 

Southwest Virginia

 

Russell Regional Business Tech Park

 

2007

 

S

 

102,842

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2

 

Total Other

 

 

 

 

 

 

 

 

 

295,842

 

 

 

The S or M notation indicates single story or multi-story building, respectively.

 

10



 

Office Property Summary by Region - March 31, 2011

Wholly Owned Properties

 

Operating
Property
Count

 

 

 

Submarket

 

Business Park

 

Year Built or
Renovated

 

S or M

 

Total
Operational
Square Feet

 

Total Square Feet
Under
Construction /
Redevelopment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Greater Philadelphia

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

785 Jolly Road

 

Blue Bell

 

Arborcrest

 

1996

 

M

 

219,065

 

 

2

 

801 Lakeview Drive

 

Blue Bell

 

Arborcrest

 

1994

 

M

 

156,695

 

61,958

 

2

 

Total Greater Philadelphia

 

 

 

 

 

 

 

 

 

375,760

 

61,958

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

San Antonio, Texas

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2

 

7700 Potranco Road

 

San Antonio Northwest

 

Sentry Gateway

 

1982/1985

 

M

 

508,412

 

 

 

3

 

8000 Potranco Road

 

San Antonio Northwest

 

Sentry Gateway

 

2010

 

M

 

125,157

 

 

 

4

 

8030 Potranco Road

 

San Antonio Northwest

 

Sentry Gateway

 

2010

 

M

 

125,155

 

 

 

5

 

7700-5 Potranco-Warehouse

 

San Antonio Northwest

 

Sentry Gateway

 

2009

 

S

 

25,056

 

 

 

6

 

7700-1 Potranco Road

 

San Antonio Northwest

 

Sentry Gateway

 

2007

 

S

 

8,674

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

792,454

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

1560 Cable Ranch Road - Building B

 

San Antonio Northwest

 

151 Technology Center

 

1985/2006

 

M

 

77,040

 

 

 

2

 

1560 Cable Ranch Road - Building A

 

San Antonio Northwest

 

151 Technology Center

 

1985/2007

 

M

 

45,935

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

122,975

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8

 

Total San Antonio, Texas

 

 

 

 

 

 

 

 

 

915,429

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Colorado Springs, Colorado

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

985 Space Center Drive

 

Colorado Springs East

 

Patriot Park

 

1989

 

M

 

106,026

 

 

 

2

 

655 Space Center Drive

 

Colorado Springs East

 

Patriot Park

 

2008

 

M

 

103,970

 

 

 

3

 

565 Space Center Drive

 

Colorado Springs East

 

Patriot Park

 

2009

 

M

 

89,899

 

 

 

4

 

745 Space Center Drive

 

Colorado Springs East

 

Patriot Park

 

2006

 

M

 

51,500

 

 

 

5

 

980 Technology Court

 

Colorado Springs East

 

Patriot Park

 

1995

 

S

 

33,207

 

 

 

6

 

525 Babcock Road

 

Colorado Springs East

 

Patriot Park

 

1967

 

S

 

14,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

398,602

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

1055 North Newport Road

 

Colorado Springs East

 

Aerotech Commerce Park

 

2007-2008

 

M

 

59,763

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

3535 Northrop Grumman Point

 

Colorado Springs East

 

Colorado Springs Airport

 

2008

 

M

 

124,305

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

1670 North Newport Road

 

Colorado Springs East

 

Newport

 

1986-1987

 

M

 

67,500

 

 

 

2

 

1915 Aerotech Drive

 

Colorado Springs East

 

 

 

1985

 

S

 

37,946

 

 

 

3

 

1925 Aerotech Drive

 

Colorado Springs East

 

 

 

1985

 

S

 

37,946

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

143,392

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

10807 New Allegiance Drive

 

I-25 North Corridor

 

InterQuest Office

 

2009

 

M

 

145,723

 

 

 

2

 

9965 Federal Drive

 

I-25 North Corridor

 

InterQuest Office

 

1983/2007

 

M

 

74,749

 

 

 

3

 

9945 Federal Drive

 

I-25 North Corridor

 

InterQuest Office

 

2009

 

S

 

74,005

 

 

 

4

 

9950 Federal Drive

 

I-25 North Corridor

 

InterQuest Office

 

2001

 

S

 

66,223

 

 

 

5

 

12515 Academy Ridge View

 

I-25 North Corridor

 

InterQuest Office

 

2006

 

M

 

61,372

 

 

 

6

 

9925 Federal Drive

 

I-25 North Corridor

 

InterQuest Office

 

2008

 

S

 

53,788

 

 

 

7

 

9960 Federal Drive

 

I-25 North Corridor

 

InterQuest Office

 

2001

 

S

 

46,948

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

522,808

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

5725 Mark Dabling Boulevard

 

Colorado Springs Northwest

 

Northcreek

 

1984

 

M

 

108,976

 

 

 

2

 

5775 Mark Dabling Boulevard

 

Colorado Springs Northwest

 

Northcreek

 

1984

 

M

 

108,640

 

 

 

3

 

5755 Mark Dabling Boulevard

 

Colorado Springs Northwest

 

Northcreek

 

1989

 

M

 

104,848

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

322,464

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

21

 

Total Colorado Springs, Colorado

 

 

 

 

 

 

 

 

 

1,571,334

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Washington, DC - Capitol Riverfront

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

1201 M Street

 

Washington, DC - Capitol Riverfront

 

Maritime Plaza

 

2001

 

M

 

200,509

 

 

 

2

 

1220 12th Street

 

Washington, DC - Capitol Riverfront

 

Maritime Plaza

 

2003

 

M

 

161,165

 

 

 

 

 

Total Washington, DC - Capitol Riverfront

 

 

 

 

 

 

 

 

 

361,674

 

 

 

The S or M notation indicates single story or multi-story building, respectively.

 

11



 

Office Property Summary by Region - March 31, 2011

Wholly Owned Properties

 

Operating
Property
Count

 

 

 

Submarket

 

Business Park

 

Year Built or
Renovated

 

S or M

 

Total
Operational
Square Feet

 

Total Square Feet
Under
Construction /
Redevelopment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Suburban Maryland

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

11800 Tech Road

 

North Silver Spring

 

Montgomery Industrial

 

1989

 

M

 

228,179

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

400 Professional Drive

 

Gaithersburg

 

Crown Point

 

2000

 

M

 

129,750

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

110 Thomas Johnson Drive

 

Frederick

 

 

 

1987/1999

 

M

 

122,490

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

45 West Gude Drive

 

Rockville

 

 

 

1987

 

M

 

122,555

 

 

 

2

 

15 West Gude Drive

 

Rockville

 

 

 

1986

 

M

 

108,485

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

231,040

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5

 

Total Suburban Maryland

 

 

 

 

 

 

 

 

 

711,459

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Greater Baltimore

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

11311 McCormick Road

 

Hunt Valley/Rte 83 Corridor

 

Hunt Valley Business Comm.

 

1984/1994

 

M

 

214,704

 

 

 

2

 

200 International Circle

 

Hunt Valley/Rte 83 Corridor

 

Hunt Valley Business Comm.

 

1987

 

M

 

125,352

 

 

 

3

 

226 Schilling Circle

 

Hunt Valley/Rte 83 Corridor

 

Hunt Valley Business Comm.

 

1980

 

M

 

97,309

 

 

 

4

 

201 International Circle

 

Hunt Valley/Rte 83 Corridor

 

Hunt Valley Business Comm.

 

1982

 

M

 

78,243

 

 

 

5

 

11011 McCormick Road

 

Hunt Valley/Rte 83 Corridor

 

Hunt Valley Business Comm.

 

1974

 

M

 

57,104

 

 

 

6

 

216 Schilling Circle

 

Hunt Valley/Rte 83 Corridor

 

Hunt Valley Business Comm.

 

1988/2001

 

M

 

35,806

 

 

 

7

 

222 Schilling Circle

 

Hunt Valley/Rte 83 Corridor

 

Hunt Valley Business Comm.

 

1978/1997

 

M

 

28,618

 

 

 

8

 

224 Schilling Circle

 

Hunt Valley/Rte 83 Corridor

 

Hunt Valley Business Comm.

 

1978/1997

 

M

 

27,575

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

664,711

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

10150 York Road

 

Hunt Valley/Rte 83 Corridor

 

 

 

1985

 

M

 

175,207

 

 

 

2

 

9690 Deereco Road

 

Hunt Valley/Rte 83 Corridor

 

 

 

1988

 

M

 

134,950

 

 

 

3

 

375 West Padonia Road

 

Hunt Valley/Rte 83 Corridor

 

 

 

1986

 

M

 

104,885

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

415,042

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

7210 Ambassador Road

 

Baltimore County Westside

 

Rutherford Business Center

 

1972

 

S

 

79,770

 

 

 

2

 

7152 Windsor Boulevard

 

Baltimore County Westside

 

Rutherford Business Center

 

1986

 

S

 

58,074

 

 

 

3

 

21 Governor’s Court

 

Baltimore County Westside

 

Rutherford Business Center

 

1981/1995

 

M

 

56,384

 

 

 

4

 

7125 Ambassador Road

 

Baltimore County Westside

 

Rutherford Business Center

 

1985

 

M

 

54,627

 

 

 

5

 

7104 Ambassador Road

 

Baltimore County Westside

 

Rutherford Business Center

 

1988

 

M

 

30,239

 

 

 

6

 

15 Governor’s Court

 

Baltimore County Westside

 

Rutherford Business Center

 

1981

 

S

 

14,890

 

 

 

7

 

17 Governor’s Court

 

Baltimore County Westside

 

Rutherford Business Center

 

1981

 

S

 

14,454

 

 

 

8

 

7127 Ambassador Road

 

Baltimore County Westside

 

Rutherford Business Center

 

1985

 

S

 

11,630

 

 

 

9

 

7129 Ambassador Road

 

Baltimore County Westside

 

Rutherford Business Center

 

1985

 

S

 

11,133

 

 

 

10

 

7106 Ambassador Road

 

Baltimore County Westside

 

Rutherford Business Center

 

1988

 

S

 

8,899

 

 

 

11

 

7108 Ambassador Road

 

Baltimore County Westside

 

Rutherford Business Center

 

1988

 

S

 

8,811

 

 

 

12

 

7102 Ambassador Road

 

Baltimore County Westside

 

Rutherford Business Center

 

1988

 

S

 

8,794

 

 

 

13

 

7131 Ambassador Road

 

Baltimore County Westside

 

Rutherford Business Center

 

1985

 

S

 

7,734

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

365,439

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

502 Washington Avenue

 

Towson

 

 

 

1984

 

M

 

90,435

 

 

 

2

 

102 West Pennsylvania Avenue

 

Towson

 

 

 

1968/2001

 

M

 

49,701

 

 

 

3

 

100 West Pennsylvania Avenue

 

Towson

 

 

 

1952/1989

 

M

 

20,099

 

 

 

4

 

109-111 Allegheny Avenue

 

Towson

 

 

 

1971

 

M

 

18,431

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

178,666

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

1501 South Clinton Street

 

Baltimore

 

Canton Crossing

 

2006

 

M

 

481,619

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

209 Research Boulevard

 

Harford County

 

Northgate Business Park

 

2010

 

M

 

54,027

 

23,165

 

2

 

210 Research Boulevard

 

Harford County

 

Northgate Business Park

 

2010

 

M

 

27,551

 

52,022

 

 

 

 

 

 

 

 

 

 

 

 

 

81,578

 

75,187

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

31

 

Subtotal (continued on next page)

 

 

 

 

 

 

 

 

 

2,187,055

 

75,187

 

 

The S or M notation indicates single story or multi-story building, respectively.

 

12



 

Office Property Summary by Region - March 31, 2011

Wholly Owned Properties

 

Operating
Property
Count

 

 

 

Submarket

 

Business Park

 

Year Built or
Renovated

 

S or M

 

Total
Operational
Square Feet

 

Total Square Feet
Under
Construction /
Redevelopment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

31

 

Subtotal (continued from prior page)

 

 

 

 

 

 

 

 

 

2,187,055

 

75,187

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

4940 Campbell Boulevard

 

White Marsh

 

Campbell Corporate Center

 

1990

 

M

 

50,415

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

8110 Corporate Drive

 

White Marsh

 

Corporate Place

 

2001

 

M

 

79,091

 

 

 

2

 

8140 Corporate Drive

 

White Marsh

 

Corporate Place

 

2003

 

M

 

76,271

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

155,362

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

9910 Franklin Square Drive

 

White Marsh

 

Franklin Ridge

 

2005

 

S

 

57,812

 

 

 

2

 

9920 Franklin Square Drive

 

White Marsh

 

Franklin Ridge

 

2006

 

S

 

42,891

 

 

 

3

 

9930 Franklin Square Drive

 

White Marsh

 

Franklin Ridge

 

2001

 

S

 

39,750

 

 

 

4

 

9900 Franklin Square Drive

 

White Marsh

 

Franklin Ridge

 

1999

 

S

 

33,800

 

 

 

5

 

9940 Franklin Square Drive

 

White Marsh

 

Franklin Ridge

 

2000

 

S

 

32,242

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

206,495

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

8020 Corporate Drive

 

White Marsh

 

McLean Ridge

 

1997

 

S

 

50,796

 

 

 

2

 

8094 Sandpiper Circle

 

White Marsh

 

McLean Ridge

 

1998

 

S

 

49,585

 

 

 

3

 

8098 Sandpiper Circle

 

White Marsh

 

McLean Ridge

 

1998

 

S

 

46,485

 

 

 

4

 

8010 Corporate Drive

 

White Marsh

 

McLean Ridge

 

1998

 

S

 

38,487

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

185,353

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

5355 Nottingham Ridge Road

 

White Marsh

 

Nottingham Ridge

 

2005

 

S

 

35,930

 

 

 

2

 

5325 Nottingham Ridge Road

 

White Marsh

 

Nottingham Ridge

 

2002

 

S

 

35,678

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

71,608

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

7941-7949 Corporate Drive

 

White Marsh

 

Tyler Ridge

 

1996

 

S

 

57,782

 

 

 

2

 

8007 Corporate Drive

 

White Marsh

 

Tyler Ridge

 

1995

 

S

 

41,799

 

 

 

3

 

8019 Corporate Drive

 

White Marsh

 

Tyler Ridge

 

1990

 

S

 

32,423

 

 

 

4

 

8013 Corporate Drive

 

White Marsh

 

Tyler Ridge

 

1990

 

S

 

29,995

 

 

 

5

 

8003 Corporate Drive

 

White Marsh

 

Tyler Ridge

 

1999

 

S

 

17,599

 

 

 

6

 

8015 Corporate Drive

 

White Marsh

 

Tyler Ridge

 

1990

 

S

 

15,669

 

 

 

7

 

8023 Corporate Drive

 

White Marsh

 

Tyler Ridge

 

1990

 

S

 

9,486

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

204,753

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

5020 Campbell Boulevard

 

White Marsh

 

White Marsh Business Center

 

1986-1988

 

S

 

43,623

 

 

 

2

 

5024 Campbell Boulevard

 

White Marsh

 

White Marsh Business Center

 

1986-1988

 

S

 

33,710

 

 

 

3

 

5026 Campbell Boulevard

 

White Marsh

 

White Marsh Business Center

 

1986-1988

 

S

 

30,163

 

 

 

4

 

5022 Campbell Boulevard

 

White Marsh

 

White Marsh Business Center

 

1986-1988

 

S

 

26,748

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

134,244

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

10001 Franklin Square Drive

 

White Marsh

 

White Marsh Commerce Center

 

1997

 

S

 

218,215

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

8114 Sandpiper Circle

 

White Marsh

 

White Marsh Health Center

 

1986

 

S

 

45,803

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

4979 Mercantile Road

 

White Marsh

 

White Marsh Hi-Tech Center

 

1985

 

S

 

49,590

 

 

 

2

 

4969 Mercantile Road

 

White Marsh

 

White Marsh Hi-Tech Center

 

1983

 

S

 

47,132

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

96,722

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

7939 Honeygo Boulevard

 

White Marsh

 

White Marsh Professional Center

 

1984

 

M

 

28,208

 

 

 

2

 

8133 Perry Hall Boulevard

 

White Marsh

 

White Marsh Professional Center

 

1988

 

M

 

27,996

 

 

 

3

 

7923 Honeygo Boulevard

 

White Marsh

 

White Marsh Professional Center

 

1985

 

M

 

23,481

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

79,685

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

8031 Corporate Drive

 

White Marsh

 

 

 

1988/2004

 

S

 

66,000

 

 

 

2

 

8615 Ridgely’s Choice Drive

 

White Marsh

 

 

 

2005

 

M

 

37,746

 

 

 

3

 

8029 Corporate Drive

 

White Marsh

 

 

 

1988/2004

 

S

 

25,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

128,746

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

66

 

Total Greater Baltimore

 

 

 

 

 

 

 

 

 

3,764,456

 

75,187

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

252

 

TOTAL WHOLLY-OWNED OFFICE PROPERTY PORTFOLIO

 

 

 

 

 

 

 

 

 

20,183,489

 

277,675

 

 

The S or M notation indicates single story or multi-story building, respectively.

 

13



 

First Quarter 2011

 

Land Controlled

 

Location

 

Submarket

 

Status

 

Acres

 

 

 

Estimated
Developable
Square Feet

 

 

 

 

 

 

 

 

 

 

 

 

 

National Business Park - North

 

BWI Airport

 

Wholly owned

 

162

 

 

 

1,111,000

 

1243 Winterson Road (AS 22)

 

BWI Airport

 

Wholly owned

 

2

 

 

 

30,000

 

940 Elkridge Landing Road (AS 7)

 

BWI Airport

 

Wholly owned

 

3

 

 

 

54,000

 

West Nursery Road

 

BWI Airport

 

Wholly owned

 

1

 

 

 

5,000

 

Arundel Preserve

 

BWI Airport

 

Consolidated JV- 50% interest/Under contract

 

56

 

up to

 

1,652,000

 

1460 Dorsey Road

 

BWI Airport

 

Wholly owned

 

6

 

 

 

60,000

 

Columbia Gateway Parcel T-11

 

Howard Co. Perimeter

 

Wholly owned

 

14

 

 

 

220,000

 

7125 Columbia Gateway Drive

 

Howard Co. Perimeter

 

Wholly owned

 

8

 

 

 

275,000

 

Riverwood

 

Howard Co. Perimeter

 

Wholly owned

 

5

 

 

 

27,000

 

Total Baltimore / Washington Corridor

 

 

 

 

 

257

 

 

 

3,434,000

 

 

 

 

 

 

 

 

 

 

 

 

 

Westfields Corporate Center

 

Dulles South

 

Wholly owned

 

23

 

 

 

400,000

 

Westfields - Park Center

 

Dulles South

 

Wholly owned

 

33

 

 

 

674,000

 

Woodland Park

 

Herndon

 

Wholly owned

 

5

 

 

 

225,000

 

Patriot Ridge

 

Springfield

 

Wholly owned

 

11

 

 

 

738,000

 

Total Northern Virginia

 

 

 

 

 

72

 

 

 

2,037,000

 

 

 

 

 

 

 

 

 

 

 

 

 

Canton Crossing

 

Baltimore

 

Wholly owned

 

10

 

 

 

773,000

 

White Marsh

 

White Marsh

 

Wholly owned

 

152

 

 

 

1,692,000

 

37 Allegheny Avenue

 

Towson

 

Wholly owned

 

0.3

 

 

 

40,000

 

North Gate Business Park

 

Harford County

 

Wholly owned

 

34

 

 

 

439,000

 

Total Greater Baltimore

 

 

 

 

 

196

 

 

 

2,944,000

 

 

 

 

 

 

 

 

 

 

 

 

 

Thomas Johnson Drive

 

Frederick

 

Wholly owned

 

6

 

 

 

170,000

 

Route 15 / Biggs Ford Road

 

Frederick

 

Wholly owned

 

107

 

 

 

1,000,000

 

Rockville Corporate Center

 

Rockville

 

Wholly owned

 

10

 

 

 

220,000

 

M Square Research Park

 

College Park

 

Consolidated JV- 50% interest/Under contract

 

49

 

 

 

510,000

 

Total Suburban Maryland

 

 

 

 

 

172

 

 

 

1,900,000

 

 

 

 

 

 

 

 

 

 

 

 

 

Arborcrest

 

Blue Bell

 

Wholly owned

 

8

 

 

 

790,000

 

Total Greater Philadelphia

 

 

 

 

 

8

 

 

 

790,000

 

 

 

 

 

 

 

 

 

 

 

 

 

Dahlgren Technology Center

 

King George County

 

Wholly owned

 

38

 

 

 

64,000

 

Expedition VII

 

St. Mary’s County

 

Wholly owned

 

6

 

 

 

60,000

 

Total St. Mary’s & King George Counties

 

 

 

 

 

44

 

 

 

124,000

 

 

 

 

 

 

 

 

 

 

 

 

 

InterQuest

 

I-25 North Corridor

 

Wholly owned

 

113

 

 

 

1,623,000

 

9965 Federal Drive

 

I-25 North Corridor

 

Wholly owned

 

4

 

 

 

30,000

 

Patriot Park

 

Colorado Springs East

 

Wholly owned

 

71

 

 

 

756,000

 

Aerotech Commerce

 

Colorado Springs East

 

Wholly owned

 

6

 

 

 

90,000

 

Total Colorado Springs

 

 

 

 

 

194

 

 

 

2,499,000

 

 

 

 

 

 

 

 

 

 

 

 

 

Northwest Crossroads

 

San Antonio Northwest

 

Wholly owned

 

31

 

 

 

375,000

 

Military Drive

 

San Antonio Northwest

 

Wholly owned

 

37

 

 

 

658,000

 

Total San Antonio

 

 

 

 

 

68

 

 

 

1,033,000

 

 

 

 

 

 

 

 

 

 

 

 

 

Redstone Gateway

 

Huntsville, AL

 

Consolidated JV - 85% interest/Under contract

 

458

 

 

 

4,360,000

 

Total Huntsville

 

 

 

 

 

458

 

 

 

4,360,000

 

 

 

 

 

 

 

 

 

 

 

 

 

Indian Head

 

Charles County, MD

 

Consolidated JV - 75% interest

 

206

 

 

 

967,000

 

Fort Ritchie (1)

 

Fort Ritchie

 

Wholly owned

 

591

 

 

 

1,700,000

 

Total Other

 

 

 

 

 

797

 

 

 

2,667,000

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL

 

 

 

 

 

2,265

 

 

 

21,788,000

 

 

This land inventory schedule excludes all properties listed as under construction, redevelopment or under development as detailed on pages 22 and 23, and includes properties under ground lease to us.

 


(1) The Fort Ritchie acquisition includes 283,565 square feet of existing office space targeted for future redevelopment and 110 existing usable residential units.

 

14



 

First Quarter 2011

 

Top 20 Tenants

(Based on Annualized Rental Revenue of

wholly owned office properties, dollars in thousands)

 

 

 

 

 

 

 

Percentage of

 

Total

 

Percentage

 

Weighted

 

 

 

 

 

Total

 

Total

 

Annualized

 

of Total

 

Average

 

 

 

Number of

 

Occupied

 

Occupied

 

Rental

 

Annualized Rental

 

Remaining

 

Tenant

 

Leases

 

Square Feet

 

Square Feet

 

Revenue (2)

 

Revenue

 

Lease Term (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States of America

(4)

77

 

3,165,508

 

18.0

%

$

95,956

 

21.2

%

5.9

 

Northrop Grumman Corporation

(5)

16

 

1,204,210

 

6.9

%

31,957

 

7.1

%

6.5

 

Booz Allen Hamilton, Inc.

 

9

 

806,288

 

4.6

%

24,627

 

5.5

%

4.9

 

Computer Sciences Corporation

(5)

6

 

609,715

 

3.5

%

18,539

 

4.1

%

2.9

 

ITT Corporation

(5)

9

 

332,490

 

1.9

%

8,162

 

1.8

%

3.9

 

The MITRE Corporation

 

4

 

267,087

 

1.5

%

7,880

 

1.7

%

5.6

 

Wells Fargo & Company

(5)

6

 

216,374

 

1.2

%

7,780

 

1.7

%

7.2

 

The Aerospace Corporation

 

3

 

238,610

 

1.4

%

7,631

 

1.7

%

3.9

 

L-3 Communications Holdings, Inc.

(5)

4

 

258,192

 

1.5

%

7,521

 

1.7

%

3.0

 

CareFirst, Inc.

 

2

 

222,610

 

1.3

%

7,247

 

1.6

%

5.5

 

Integral Systems, Inc.

(5)

4

 

241,627

 

1.4

%

6,249

 

1.4

%

8.9

 

Comcast Corporation

(5)

7

 

308,332

 

1.8

%

6,156

 

1.4

%

2.5

 

The Boeing Company

(5)

6

 

196,939

 

1.1

%

5,974

 

1.3

%

3.5

 

AT&T Corporation

(5)

4

 

317,570

 

1.8

%

5,408

 

1.2

%

7.7

 

Ciena Corporation

 

5

 

270,557

 

1.5

%

5,074

 

1.1

%

2.0

 

General Dynamics Corporation

(5)

6

 

208,264

 

1.2

%

4,601

 

1.0

%

2.4

 

Raytheon Company

 

6

 

164,404

 

0.9

%

4,402

 

1.0

%

3.0

 

Unisys Corporation

 

1

 

156,695

 

0.9

%

4,143

 

0.9

%

9.2

 

The Johns Hopkins Institutions

(5)

5

 

141,403

 

0.8

%

3,634

 

0.8

%

5.6

 

Merck & Co., Inc.

 

2

 

225,894

 

1.3

%

2,949

 

0.7

%

1.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Top 20 Office Tenants

 

182

 

9,552,769

 

54.4

%

265,890

 

58.8

%

5.3

 

All remaining tenants

 

713

 

7,998,604

 

45.6

%

185,971

 

41.2

%

4.2

 

Total/Weighted Average

 

895

 

17,551,373

 

100.0

%

$

451,861

 

100.0

%

4.9

 

 


(1)          Table excludes owner occupied leasing activity which represents 173,085 square feet with total annualized rental revenue of $4.0 million, and a weighted average remaining lease term of 4.9 years as of March 31, 2011.

(2)          Total Annualized Rental Revenue is the monthly contractual base rent as of March 31, 2011, multiplied by 12, plus the estimated annualized expense reimbursements under existing office leases.

(3)          The weighting of the lease term was computed using Total Rental Revenue.

(4)          Many of our government leases are subject to early termination provisions which are customary to government leases. The weighted average remaining lease term was computed assuming no exercise of such early termination rights.

(5)          Includes affiliated organizations or agencies.

 

15



 

First Quarter 2011

 

Renewal Analysis for Wholly Owned Office Properties

for Three Months Ended March 31, 2011

 

 

 

Baltimore/
Washington
Corridor

 

Northern
Virginia

 

Greater
Baltimore

 

Suburban
Maryland

 

St. Mary’s and
King George
Counties

 

Colorado
Springs

 

Washington
DC-Capital
Riverfront

 

Total
Office

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended March 31, 2011:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expiring Square Feet

 

304,426

 

493,670

 

245,866

 

41,675

 

7,787

 

66,915

 

17,970

 

1,178,309

 

Vacated Square Feet

 

94,656

 

172,591

 

112,452

 

 

 

 

 

14,758

 

394,457

 

Renewed Square Feet

 

209,770

 

321,079

 

133,414

 

41,675

 

7,787

 

66,915

 

3,212

 

783,852

 

Retention Rate (% based upon square feet)

 

68.9

%

65.0

%

54.3

%

100.0

%

100.0

%

100.0

%

17.9

%

66.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Renewed Space Only:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Committed Cost per Square Foot

 

$

21.37

 

$

0.96

 

$

17.88

 

$

4.20

 

$

3.19

 

$

15.00

 

$

0.91

 

$

10.69

 

Weighted Average Lease Term in years

 

7.0

 

1.1

 

5.0

 

2.0

 

2.0

 

5.0

 

1.0

 

3.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in Total Rent - GAAP

 

6.0

%

4.1

%

7.2

%

2.0

%

-17.0

%

17.3

%

5.4

%

5.5

%

Change in Total Rent - Cash

 

1.4

%

1.6

%

-8.8

%

2.3

%

-20.5

%

-1.7

%

4.8

%

-0.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Renewed & Retenanted Space:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Committed Cost per Square Foot

 

$

24.46

 

$

9.02

 

$

17.41

 

$

4.20

 

$

10.56

 

$

15.00

 

$

21.25

 

$

15.61

 

Weighted Average Lease Term in years

 

7.0

 

2.1

 

5.0

 

2.0

 

1.4

 

5.0

 

4.3

 

4.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in Total Rent - GAAP

 

2.6

%

3.9

%

4.6

%

2.0

%

16.5

%

17.3

%

3.2

%

4.3

%

Change in Total Rent - Cash

 

-1.4

%

1.7

%

-10.4

%

2.3

%

13.9

%

-1.7

%

27.0

%

-0.8

%

 

Notes:

No renewal or retenanting activity transpired in our San Antonio, Greater Philadelphia or Other regions.

 

Activity is exclusive of owner occupied space and leases with less than a one-year term.

 

Retention rate includes early renewals.

 

16



 

First Quarter 2011

 

Lease Expiration Analysis

(wholly owned office properties)

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

Annual. Rental

 

Percentage

 

Annual. Rental

 

 

 

 

 

Square

 

 

 

 

 

Revenue of

 

of Total

 

Revenue of

 

Year and Region

 

Number

 

Footage

 

Percentage of

 

Percentage of

 

Expiring

 

Annualized Rental

 

Expiring Leases

 

of Lease

 

of Leases

 

of Leases

 

Period’s Expiring

 

Total Occupied

 

Leases (3)

 

Revenue

 

per Occupied

 

Expiration (2)

 

Expiring

 

Expiring

 

Square Feet

 

Square Feet

 

(000’s)

 

Expiring

 

Square Foot

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

48

 

626,201

 

46.6

%

3.6

%

$

15,501

 

3.4

%

$

24.75

 

Northern Virginia

 

4

 

31,612

 

2.4

%

0.2

%

1,008

 

0.2

%

31.90

 

Greater Baltimore

 

56

 

343,242

 

25.6

%

2.0

%

6,801

 

1.5

%

19.81

 

Suburban Maryland

 

3

 

83,052

 

6.2

%

0.5

%

2,328

 

0.5

%

28.03

 

St. Mary’s and King George Cos.

 

10

 

110,919

 

8.3

%

0.6

%

2,252

 

0.5

%

20.30

 

Colorado Springs

 

8

 

72,191

 

5.4

%

0.4

%

1,141

 

0.3

%

15.80

 

Washington, DC-Capitol Riverfront

 

6

 

75,249

 

5.6

%

0.4

%

3,663

 

0.8

%

48.68

 

2011

 

135

 

1,342,466

 

100.0

%

7.7

%

32,694

 

7.2

%

24.35

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

49

 

1,133,216

 

42.1

%

6.5

%

29,779

 

6.6

%

26.28

 

Northern Virginia

 

19

 

398,406

 

14.8

%

2.3

%

10,805

 

2.4

%

27.12

 

Greater Baltimore

 

57

 

478,470

 

17.8

%

2.7

%

9,242

 

2.0

%

19.31

 

Suburban Maryland

 

2

 

18,423

 

0.7

%

0.1

%

322

 

0.1

%

17.45

 

St. Mary’s and King George Cos.

 

12

 

285,196

 

10.6

%

1.6

%

5,349

 

1.2

%

18.76

 

Greater Philadelphia

 

2

 

78,359

 

2.9

%

0.4

%

1,392

 

0.3

%

17.76

 

Colorado Springs

 

7

 

75,775

 

2.8

%

0.4

%

1,579

 

0.3

%

20.84

 

Washington, DC-Capitol Riverfront

 

2

 

4,820

 

0.2

%

0.0

%

220

 

0.0

%

45.64

 

Greater Philadelphia

 

1

 

219,065

 

3.2

%

1.2

%

2,783

 

0.6

%

12.71

 

2012

 

151

 

2,691,730

 

100.0

%

15.3

%

61,470

 

13.6

%

22.84

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

57

 

1,208,871

 

57.8

%

6.9

%

37,795

 

8.4

%

31.26

 

Northern Virginia

 

11

 

156,013

 

7.5

%

0.9

%

4,030

 

0.9

%

25.83

 

Greater Baltimore

 

46

 

351,649

 

16.8

%

2.0

%

7,527

 

1.7

%

21.41

 

Suburban Maryland

 

2

 

8,909

 

0.4

%

0.1

%

242

 

0.1

%

27.16

 

St. Mary’s and King George Cos.

 

7

 

109,215

 

5.2

%

0.6

%

1,924

 

0.4

%

17.61

 

Colorado Springs

 

8

 

124,405

 

6.0

%

0.7

%

2,455

 

0.5

%

19.73

 

Washington, DC-Capitol Riverfront

 

5

 

131,209

 

6.3

%

0.7

%

5,706

 

1.3

%

43.49

 

2013

 

136

 

2,090,271

 

100.0

%

11.9

%

59,679

 

13.2

%

28.55

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

46

 

726,426

 

38.7

%

4.1

%

20,345

 

4.5

%

28.01

 

Northern Virginia

 

8

 

449,957

 

24.0

%

2.6

%

14,068

 

3.1

%

31.27

 

Greater Baltimore

 

33

 

314,666

 

16.8

%

1.8

%

5,765

 

1.3

%

18.32

 

Suburban Maryland

 

4

 

88,166

 

4.7

%

0.5

%

1,829

 

0.4

%

20.74

 

St. Mary’s and King George Cos.

 

9

 

46,126

 

2.5

%

0.3

%

1,087

 

0.2

%

23.57

 

Colorado Springs

 

9

 

178,558

 

9.5

%

1.0

%

3,969

 

0.9

%

22.23

 

Washington, DC-Capitol Riverfront

 

6

 

71,562

 

3.8

%

0.4

%

3,054

 

0.7

%

42.68

 

2014

 

115

 

1,875,461

 

100.0

%

10.7

%

50,118

 

11.1

%

26.72

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

55

 

1,127,803

 

44.2

%

6.4

%

30,114

 

6.7

%

26.70

 

Northern Virginia

 

12

 

703,129

 

27.6

%

4.0

%

21,086

 

4.7

%

29.99

 

Greater Baltimore

 

37

 

383,672

 

15.1

%

2.2

%

7,030

 

1.6

%

18.32

 

Suburban Maryland

 

3

 

132,505

 

5.2

%

0.8

%

2,585

 

0.6

%

19.51

 

St. Mary’s and King George Cos.

 

8

 

76,199

 

3.0

%

0.4

%

1,300

 

0.3

%

17.07

 

Colorado Springs

 

8

 

95,106

 

3.7

%

0.5

%

1,749

 

0.4

%

18.39

 

Washington, DC-Capitol Riverfront

 

2

 

30,314

 

1.2

%

0.2

%

1,346

 

0.3

%

44.40

 

2015

 

125

 

2,548,728

 

100.0

%

14.5

%

65,210

 

14.4

%

25.59

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

94

 

2,787,145

 

40.1

%

15.9

%

72,100

 

16.0

%

25.87

 

Northern Virginia

 

25

 

687,650

 

9.9

%

3.9

%

20,805

 

4.6

%

30.26

 

Greater Baltimore

 

73

 

1,274,463

 

18.3

%

7.3

%

31,351

 

6.9

%

24.60

 

Suburban Maryland

 

4

 

165,446

 

2.4

%

0.9

%

3,861

 

0.9

%

23.34

 

St. Mary’s and King George Cos.

 

5

 

63,993

 

0.9

%

0.4

%

1,273

 

0.3

%

19.89

 

Greater Philadelphia

 

1

 

156,695

 

2.3

%

0.9

%

4,143

 

0.9

%

26.44

 

Colorado Springs

 

12

 

649,826

 

9.4

%

3.7

%

13,343

 

3.0

%

20.53

 

San Antonio

 

6

 

837,070

 

12.0

%

4.8

%

24,557

 

5.4

%

29.34

 

Washington, DC-Capitol Riverfront

 

3

 

31,750

 

0.5

%

0.2

%

1,341

 

0.3

%

42.24

 

Other

 

2

 

295,842

 

4.3

%

1.7

%

9,010

 

2.0

%

30.46

 

Thereafter

 

225

 

6,949,880

 

100.0

%

39.6

%

181,785

 

40.2

%

26.16

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other (4)

 

6

 

46,814

 

100.0

%

0.3

%

905

 

0.2

%

19.33

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total / Average

 

893

 

17,545,350

 

 

 

100.0

%

$

451,860

 

100.0

%

$

25.75

 

 

NOTE:  As of March 31, 2011, the weighted average lease term for the wholly owned office properties is 4.9 years.

 


(1)          This expiration analysis includes the effect of early renewals completed on existing leases but excludes the effect of new tenant leases on 443,285 square feet yet to commence as of March 31, 2011.

(2)          Many of our government leases are subject to certain early termination provisions which are customary to government leases.  The year of lease expiration was computed assuming no exercise of such early termination rights.

(3)          Total Annualized Rental Revenue is the monthly contractual base rent as of March 31, 2011 multiplied by 12 plus the estimated annualized expense reimbursements under existing office leases.

(4)          Month-to-month leases and leases which have expired but the tenant remains in holdover are included in this line.

 

17



 

First Quarter 2011

 

Property Occupancy Rates by Region by Quarter

(wholly owned office properties)

 

 

 

Baltimore /

 

 

 

 

 

 

 

St. Mary’s &

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Washington

 

Northern

 

Greater

 

Suburban

 

King George

 

Colorado

 

San

 

Greater

 

Washington, DC-

 

 

 

Total

 

 

 

Corridor

 

Virginia

 

Baltimore

 

Maryland

 

Counties

 

Springs

 

Antonio

 

Philadelphia

 

Capitol Riverfront

 

Other

 

Portfolio

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2011

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of Buildings

 

111

 

17

 

66

 

5

 

18

 

21

 

8

 

2

 

2

 

2

 

252

 

Rentable Square Feet

 

8,557,526

 

2,809,317

 

3,764,456

 

711,459

 

820,692

 

1,571,334

 

915,429

 

375,760

 

361,674

 

295,842

 

20,183,489

 

Occupied %

 

89.1

%

86.4

%

83.6

%

70.1

%

88.8

%

76.1

%

100.0

%

100.0

%

95.4

%

100.0

%

87.0

%

Leased %

 

91.4

%

88.8

%

85.7

%

83.2

%

88.8

%

76.3

%

100.0

%

100.0

%

95.4

%

100.0

%

89.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2010

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of Buildings

 

111

 

17

 

66

 

5

 

18

 

21

 

8

 

2

 

2

 

2

 

252

 

Rentable Square Feet

 

8,432,626

 

2,772,817

 

3,750,398

 

695,306

 

821,812

 

1,568,926

 

915,127

 

375,760

 

361,674

 

295,842

 

19,990,288

 

Occupied %

 

89.5

%

91.9

%

85.0

%

71.4

%

86.8

%

76.2

%

100.0

%

100.0

%

98.5

%

100.0

%

88.2

%

Leased %

 

90.6

%

93.1

%

85.8

%

87.1

%

86.8

%

76.2

%

100.0

%

100.0

%

98.5

%

100.0

%

89.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2010

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of Buildings

 

110

 

16

 

65

 

5

 

18

 

21

 

8

 

2

 

2

 

2

 

249

 

Rentable Square Feet

 

8,402,671

 

2,763,656

 

3,728,034

 

695,184

 

821,812

 

1,568,926

 

915,127

 

375,760

 

361,674

 

295,842

 

19,928,686

 

Occupied %

 

89.1

%

91.9

%

80.4

%

72.5

%

89.2

%

76.7

%

100.0

%

100.0

%

99.6

%

100.0

%

87.4

%

Leased %

 

90.3

%

93.2

%

83.5

%

73.3

%

89.7

%

76.7

%

100.0

%

100.0

%

99.6

%

100.0

%

88.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2010

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of Buildings

 

109

 

16

 

64

 

5

 

18

 

21

 

6

 

4

 

 

4

 

247

 

Rentable Square Feet

 

8,168,938

 

2,764,708

 

3,687,629

 

695,184

 

821,812

 

1,571,462

 

665,117

 

615,397

 

 

497,042

 

19,487,289

 

Occupied %

 

89.6

%

96.0

%

81.2

%

70.7

%

96.0

%

75.1

%

100.0

%

100.0

%

0.0

%

100.0

%

88.3

%

Leased %

 

90.6

%

96.4

%

83.4

%

71.8

%

96.0

%

75.9

%

100.0

%

100.0

%

0.0

%

100.0

%

89.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2010

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of Buildings

 

109

 

15

 

63

 

5

 

18

 

21

 

6

 

3

 

 

4

 

244

 

Rentable Square Feet

 

8,117,503

 

2,611,980

 

3,650,487

 

695,307

 

821,812

 

1,384,554

 

665,117

 

458,702

 

 

497,042

 

18,902,504

 

Occupied %

 

89.4

%

96.4

%

81.3

%

86.2

%

94.5

%

86.3

%

100.0

%

100.0

%

0.0

%

100.0

%

89.6

%

Leased %

 

90.8

%

96.8

%

81.4

%

86.2

%

94.5

%

86.3

%

100.0

%

100.0

%

0.0

%

100.0

%

90.3

%

 

18


 


 

First Quarter 2011

 

Real Estate Revenues* by Region

(dollars in thousands)

 

 

 

Three Months Ended

 

Office Properties:

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

$

53,252

 

$

52,829

 

$

51,946

 

$

50,623

 

$

52,058

 

Northern Virginia

 

18,274

 

19,283

 

18,949

 

18,172

 

18,659

 

Greater Baltimore

 

17,612

 

18,870

 

18,288

 

16,827

 

17,865

 

Colorado Springs

 

5,920

 

6,235

 

6,176

 

6,154

 

6,332

 

Suburban Maryland

 

5,609

 

5,235

 

5,243

 

5,452

 

5,829

 

St. Mary’s and King George Counties

 

3,534

 

3,417

 

3,431

 

3,530

 

3,589

 

San Antonio

 

7,663

 

7,898

 

5,609

 

4,228

 

3,938

 

Washington, DC - Capitol Riverfront

 

4,590

 

4,543

 

135

 

 

 

Greater Philadelphia

 

1,939

 

1,794

 

1,793

 

1,510

 

1,202

 

Wholesale Data Center

 

1,210

 

900

 

162

 

 

 

Other

 

2,838

 

2,709

 

3,296

 

3,495

 

3,524

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate revenues from cont. and discont. operations

 

$

122,441

 

$

123,713

 

$

115,028

 

$

109,991

 

$

112,996

 

 

NOI* by Region

(dollars in thousands)

 

 

 

Three Months Ended

 

Office Properties:

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

$

31,862

 

$

33,442

 

$

33,001

 

$

33,770

 

$

29,903

 

Northern Virginia

 

10,603

 

12,382

 

11,754

 

11,466

 

11,346

 

Greater Baltimore

 

9,072

 

11,528

 

10,460

 

9,516

 

8,855

 

Colorado Springs

 

3,484

 

4,026

 

3,796

 

3,915

 

4,023

 

Suburban Maryland

 

2,891

 

3,096

 

2,625

 

3,253

 

3,128

 

St. Mary’s and King George Counties

 

2,518

 

2,377

 

2,279

 

2,489

 

2,482

 

San Antonio

 

3,794

 

3,877

 

2,912

 

2,128

 

2,309

 

Washington, DC - Capitol Riverfront

 

2,963

 

2,835

 

135

 

 

 

Greater Philadelphia

 

1,493

 

1,315

 

1,561

 

710

 

439

 

Wholesale Data Center

 

504

 

(51

)

(89

)

 

 

Other

 

2,352

 

1,867

 

2,290

 

2,600

 

2,215

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI

 

$

71,536

 

$

76,694

 

$

70,724

 

$

69,847

 

$

64,700

 

 


*Includes continuing and discontinued operations.

 

19



 

First Quarter 2011

 

Same Office Properties (1) Average Occupancy Rates by Region

 

 

 

Number

 

Rentable

 

 

 

 

 

 

 

 

 

 

 

 

 

of

 

Square

 

Three Months Ended

 

 

 

Buildings

 

Feet

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore Washington Corridor

 

109

 

8,231,594

 

88.1

%

87.8

%

87.8

%

88.1

%

88.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Northern Virginia

 

15

 

2,605,946

 

85.8

%

91.5

%

91.6

%

96.2

%

96.6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Greater Baltimore

 

63

 

3,646,948

 

82.9

%

82.3

%

81.1

%

81.2

%

80.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Suburban Maryland

 

8

 

1,009,394

 

75.8

%

77.0

%

76.3

%

75.3

%

88.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

St.Mary’s and King George Counties

 

18

 

820,692

 

88.8

%

87.8

%

93.3

%

95.3

%

94.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Colorado Springs

 

19

 

1,335,712

 

85.0

%

85.2

%

84.0

%

85.5

%

85.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

San Antonio

 

6

 

665,117

 

100.0

%

100.0

%

100.0

%

100.0

%

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Greater Philadelphia

 

1

 

219,065

 

100.0

%

100.0

%

100.0

%

100.0

%

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

2

 

295,842

 

100.0

%

100.0

%

100.0

%

100.0

%

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Office

 

241

 

18,830,310

 

86.7

%

87.3

%

87.1

%

88.1

%

88.8

%

 


(1)  Same office properties represent buildings owned and 100% operational since January 1, 2010.

 

20



 

First Quarter 2011

 

Same Office Property Real Estate Revenues by Region

(dollars in thousands)

 

 

 

Three Months Ended

 

Office Properties:

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

$

50,261

 

$

50,523

 

$

50,021

 

$

50,000

 

$

51,589

 

Northern Virginia

 

16,811

 

18,003

 

17,633

 

18,131

 

18,659

 

Greater Baltimore

 

16,793

 

18,190

 

17,905

 

16,746

 

17,797

 

Colorado Springs

 

5,580

 

5,911

 

5,868

 

5,918

 

6,079

 

Suburban Maryland

 

5,609

 

5,235

 

5,243

 

5,452

 

5,828

 

St. Mary’s and King George Counties

 

3,535

 

3,417

 

3,431

 

3,530

 

3,589

 

San Antonio

 

5,869

 

5,964

 

5,039

 

4,227

 

3,938

 

Greater Philadelphia

 

506

 

741

 

825

 

694

 

526

 

Other

 

2,437

 

2,513

 

2,551

 

2,481

 

2,533

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate revenues from cont. and discont. operations

 

$

107,401

 

$

110,497

 

$

108,516

 

$

107,179

 

$

110,538

 

 

Same Office Property NOI by Region

(dollars in thousands)

 

 

 

Three Months Ended

 

Office Properties:

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

$

29,839

 

$

31,708

 

$

31,657

 

$

33,528

 

$

29,896

 

Northern Virginia

 

9,717

 

11,564

 

10,711

 

11,487

 

11,476

 

Greater Baltimore

 

8,553

 

11,103

 

10,349

 

9,525

 

8,926

 

Colorado Springs

 

3,518

 

4,033

 

3,853

 

4,018

 

3,991

 

Suburban Maryland

 

2,953

 

3,117

 

2,683

 

3,283

 

3,156

 

St. Mary’s and King George Counties

 

2,520

 

2,378

 

2,281

 

2,491

 

2,483

 

San Antonio

 

2,355

 

2,402

 

2,398

 

2,173

 

2,348

 

Greater Philadelphia

 

457

 

713

 

763

 

680

 

513

 

Other

 

2,211

 

2,179

 

2,192

 

2,140

 

2,146

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI

 

$

62,123

 

$

69,197

 

$

66,887

 

$

69,325

 

$

64,935

 

Add (less): Straight-line rent adjustments

 

(3,136

)

(1,184

)

1,882

 

(1,683

)

(2,293

)

Less: Amortization of deferred market rental revenue

 

(278

)

(675

)

(433

)

(431

)

(605

)

Same office property cash NOI

 

$

58,709

 

$

67,338

 

$

68,336

 

$

67,211

 

$

62,037

 

Less: Lease termination fees, gross

 

(157

)

(2,059

)

(209

)

(1,086

)

(278

)

Same office property cash NOI, excluding gross lease termination fees

 

$

58,552

 

$

65,279

 

$

68,127

 

$

66,125

 

$

61,759

 

 

Note: Same office properties represent buildings owned and 100% operational since January 1, 2010.

 

21


 


 

First Quarter 2011

 

Summary of Construction Projects

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Actual or

 

 

 

 

 

 

 

 

 

 

Total

 

Percentage

 

as of March 31, 2011 (1)

 

Anticipated

 

 

 

 

 

 

 

 

 

 

Rentable

 

Leased

 

Anticipated

 

 

 

Cost to

 

Construction

 

Anticipated

 

 

 

 

 

 

 

 

Square

 

as of

 

total

 

Cost

 

date placed

 

Completion

 

Operational

 

Property and Location

 

 

Submarket

 

Ownership

 

Feet

 

3/31/11

 

cost

 

to date

 

in service

 

Date (2)

 

Date (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Under Construction

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

316 Sentinel Way (316 NBP)
Annapolis Junction, Maryland

 

 

BWI Airport

 

Wholly owned

 

125,044

 

0

%

$

27,869

 

$

22,583

 

 

1Q 11

 

1Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7205 Riverwood Road
Columbia, Maryland

 

 

Howard Co. Perimeter

 

Wholly owned

 

86,000

 

0

%

18,900

 

7,198

 

 

4Q 11

 

4Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Government

 

 

 

 

 

 

211,044

 

0

%

$

46,769

 

$

29,781

 

$

 

 

 

 

 

% of Total Drivers

 

 

 

 

 

 

17

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

410 National Business Parkway
Annapolis Junction, Maryland

 

 

BWI Airport

 

Wholly owned

 

110,000

 

0

%

$

25,643

 

$

8,454

 

 

4Q 11

 

4Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

430 National Business Parkway
Annapolis Junction, Maryland

 

 

BWI Airport

 

Wholly owned

 

109,341

 

0

%

24,942

 

13,690

 

 

2Q 11

 

2Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7770 Backlick Road (Patriot Ridge I)
Springfield, Virginia

 

 

Springfield

 

Wholly owned

 

240,000

 

0

%

77,172

 

10,063

 

 

2Q 12

 

2Q 13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

206 Research Boulevard
Aberdeen, Maryland

 

 

Harford County

 

Wholly owned

 

127,300

 

0

%

25,764

 

12,744

 

 

2Q 11

 

2Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

209 Research Boulevard
Aberdeen, Maryland

(4)

 

Harford County

 

Wholly owned

 

77,192

 

100

%

18,317

 

16,805

 

13,291

 

2Q 10

 

2Q 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

210 Research Boulevard
Aberdeen, Maryland

(5)

 

Harford County

 

Wholly owned

 

79,573

 

35

%

16,898

 

13,584

 

5,922

 

4Q 10

 

4Q 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

45310 Abell House Lane
California, Maryland

 

 

St. Mary’s County

 

Wholly owned

 

80,205

 

100

%

18,080

 

9,783

 

 

3Q 11

 

4Q 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

100 Sentry Gateway
San Antonio, Texas

 

 

San Antonio Northwest

 

Wholly owned

 

94,550

 

0

%

15,433

 

10,692

 

 

4Q 10

 

4Q 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1000 Redstone Gateway
Huntsville, Alabama

 

 

Huntsville

 

Consolidated Joint Venture

 

115,000

 

0

%

21,231

 

1,279

 

 

4Q 11

 

4Q 12

 

Subtotal Defense Information Technology

 

 

 

 

 

 

1,033,161

 

18

%

$

243,480

 

$

97,094

 

$

19,213

 

 

 

 

 

% of Total Drivers

 

 

 

 

 

 

83

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Under Construction

 

 

 

 

 

 

1,244,205

 

15

%

$

290,249

 

$

126,875

 

$

19,213

 

 

 

 

 

 


(1) Cost includes land, construction and leasing costs.

(2) Actual or anticipated construction completion date is the estimated date of completion of the building shell.

(3) Anticipated operational date is the estimated date when leases have commenced on 100% of a property’s space or one year from the cessation of major construction activities.

(4) Although classified as “Under Construction,” 54,027 square feet are operational.

(5) Although classified as “Under Construction,” 27,551 square feet are operational.

 

Demand Driver Categories (as classified by COPT management):

Defense Information Technology:  Development opportunity created through our current and future relationships with defense information technology contractors and, possibly, minor Government tenancy.

Government:  Development opportunity created through our existing and future relationship with various agencies of the government of the United States of America.  Excludes Government tenancy included in

Defense Information Technology.

Market Demand:  Development opportunity created through perceived unfulfilled space requirements within a specific submarket; potential submarket demand exceeds existing supply.

Research Park:  Development opportunity created through specific research park relationship.

 

22



 

First Quarter 2011

 

Summary of Development and Redevelopment Projects

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Actual or

 

 

 

 

 

 

 

 

 

 

Total

 

Percentage

 

as of March 31, 2011 (1)

 

Anticipated

 

 

 

 

 

 

 

 

 

 

Rentable

 

Leased

 

Anticipated

 

 

 

Cost to

 

Construction

 

Anticipated

 

 

 

 

 

 

 

 

Square

 

as of

 

total

 

Cost

 

date placed

 

Completion

 

Operational

 

Property and Location

 

 

Submarket

 

Ownership

 

Feet

 

3/31/11

 

cost

 

to date

 

in service

 

Date (2)

 

Date (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Under Redevelopment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7468 Candlewood Road
Hanover, Maryland

 

 

BWI Airport

 

Wholly owned

 

357,700

 

0

%

$

41,735

 

$

40,398

 

$

 

4Q 10

 

4Q 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3120 Fairview Park Drive
Herndon, Virginia

(4)

 

Herndon

 

Wholly owned

 

183,440

 

36

%

57,800

 

43,639

 

43,639

 

4Q10

 

4Q11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

801 Lakeview Drive (Lakeside I)
Blue Bell, Pennsylvania

(5)

 

Greater Philadelphia

 

Wholly owned

 

218,653

 

100

%

30,365

 

26,616

 

20,645

 

3Q 10

 

3Q 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

751 Arbor Way (Hillcrest I)
Blue Bell, Pennsylvania

 

 

Greater Philadelphia

 

Wholly owned

 

108,500

 

0

%

19,100

 

4,373

 

 

4Q 11

 

4Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Redevelopment

 

 

 

 

 

 

868,293

 

 

 

$

149,000

 

$

115,026

 

$

64,284

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Under Development

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

312 Sentinel Way
Annapolis Junction, Maryland

 

 

BWI Airport

 

Wholly owned

 

125,000

 

 

 

30,800

 

10,834

 

 

 

2Q 12

 

2Q 13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Government

 

 

 

 

 

 

125,000

 

 

 

$

30,800

 

$

10,834

 

 

 

 

 

 

 

% of Total Drivers

 

 

 

 

 

 

13

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

310 Sentinel Way
Annapolis Junction, Maryland

 

 

BWI Airport

 

Wholly owned

 

260,000

 

 

 

$

74,300

 

$

4,257

 

 

 

1Q 13

 

1Q 14

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

420 National Business Parkway
Annapolis Junction, Maryland

 

 

BWI Airport

 

Wholly owned

 

140,000

 

 

 

36,000

 

4,996

 

 

 

3Q 12

 

3Q 13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

202 Research Boulevard (Lot H)
Aberdeen, Maryland

 

 

Harford County

 

Wholly owned

 

127,530

 

 

 

27,600

 

4,190

 

 

 

2Q 13

 

2Q 14

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sentry Gateway (Building 200)
San Antonio, Texas

 

 

San Antonio Northwest

 

Wholly owned

 

93,830

 

 

 

15,800

 

2,144

 

 

 

3Q 12

 

3Q 13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8100 Potranco Road
San Antonio, Texas

 

 

San Antonio Northwest

 

Wholly owned

 

125,000

 

 

 

25,200

 

3,373

 

 

 

4Q 12

 

3Q 13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Redstone Gateway (Building 2)
Huntsville, Alabama

 

 

Huntsville

 

Consolidated Joint Venture

 

120,000

 

 

 

23,830

 

675

 

 

 

2Q 12

 

2Q 13

 

Subtotal Defense Information Technology

 

 

 

 

 

 

866,360

 

 

 

$

202,730

 

$

19,635

 

 

 

 

 

 

 

% of Total Drivers

 

 

 

 

 

 

87

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Under Development

 

 

 

 

 

 

991,360

 

 

 

$

233,530

 

$

30,469

 

 

 

 

 

 

 

 


(1)   Cost includes land, construction and leasing costs, except for properties previously operated prior to placing into redevelopment, in which case only incremental costs of redevelopment are included.

(2)   Actual or anticipated construction completion date is the estimated date of completion of the building shell.

(3)   Anticipated operational date is the estimated date when leases have commenced on 100% of a property’s space or one year from the cessation of major construction activities.

(4)   This property was shell complete in 2008 and we acquired in December 2010.  For accounting purposes, this space was 100% operational upon acquisition. For occupancy reporting, we are including the space as “Under Redevelopment” until the earlier of when leases commence or one year from the date of acquisition. 42,910 square feet are operational.

(5)   Although classified as “Under Redevelopment”, 156,695 square feet are operational.

 

Demand Driver Categories (as classified by COPT management):

Defense Information Technology:  Development opportunity created through our current and future relationships with defense information technology contractors and, possibly, minor Government tenancy.

Government:  Development opportunity created through our existing and future relationship with various agencies of the government of the United States of America.  Excludes Government tenancy included in Defense Information Technology.

Market Demand:  Development opportunity created through perceived unfulfilled space requirements within a specific submarket; potential submarket demand exceeds existing supply.

Research Park:  Development opportunity created through a specific research park relationship.

 

23



 

First Quarter 2011

 

Construction and Development Summary

(dollars in thousands)

 

 

 

Rentable Square Feet

 

 

 

Listed

 

Listed

 

Listed

 

Listed

 

Listed

 

 

 

 

 

 

 

Construction

 

Development

 

Redevelopment

 

Wholesale Data

 

Controlled

 

 

 

 

 

 

 

Projects

 

Projects

 

Projects

 

Center

 

Land Controlled

 

Other

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

430,385

 

525,000

 

357,700

 

N/A

 

3,434,000

 

 

4,747,085

 

Northern Virginia

 

240,000

 

 

183,440

 

N/A

 

2,037,000

 

 

2,460,440

 

Greater Baltimore

 

284,065

 

127,530

 

 

N/A

 

2,944,000

 

 

3,355,595

 

Colorado Springs

 

 

 

 

N/A

 

2,499,000

 

 

2,499,000

 

Suburban Maryland

 

 

 

 

N/A

 

1,900,000

 

 

1,900,000

 

St. Mary’s and King George Counties

 

80,205

 

 

 

N/A

 

124,000

 

 

204,205

 

San Antonio

 

94,550

 

218,830

 

 

N/A

 

1,033,000

 

 

1,346,380

 

Greater Philadelphia

 

 

 

327,153

 

N/A

 

790,000

 

 

1,117,153

 

Huntsville, Alabama

 

115,000

 

120,000

 

 

 

N/A

 

4,360,000

 

 

4,595,000

 

Other

 

 

 

 

N/A

 

2,667,000

 

 

2,667,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,244,205

 

991,360

 

868,293

 

N/A

 

21,788,000

 

 

24,891,858

 

 

 

 

Costs to date, by region

 

 

 

Listed

 

Listed

 

Listed

 

Listed

 

Listed

 

 

 

 

 

 

 

Construction

 

Development

 

Redevelopment

 

Wholesale Data

 

Controlled

 

 

 

 

 

 

 

Projects (1)

 

Projects (1)

 

Projects (1)

 

Center (1)

 

Land Controlled

 

Other

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

$

51,925

 

$

20,087

 

$

40,398

 

$

 

$

83,537

 

$

15,638

 

$

211,585

 

Northern Virginia

 

10,063

 

 

43,639

 

 

43,161

 

23

 

96,886

 

Greater Baltimore

 

43,133

 

4,190

 

 

 

77,629

 

4

 

124,956

 

Colorado Springs

 

 

 

 

 

48,347

 

215

 

48,562

 

Suburban Maryland

 

 

 

 

 

23,841

 

314

 

24,155

 

St. Mary’s and King George Counties

 

9,783

 

 

 

 

3,381

 

 

13,164

 

San Antonio

 

10,692

 

5,517

 

 

 

20,400

 

2,888

 

39,497

 

Greater Philadelphia

 

 

 

30,989

 

 

17,586

 

 

48,575

 

Huntsville, Alabama

 

1,279

 

675

 

 

 

13,308

 

 

15,262

 

Wholesale Data Center

 

 

 

 

153,974

 

 

 

153,974

 

Other

 

 

 

 

 

10,515

 

 

10,515

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

126,875

 

$

30,469

 

$

115,026

 

$

153,974

 

$

341,705

 

$

19,082

 

$

787,131

 

 

 

 

Costs to date, by Balance Sheet line item

 

 

 

Listed

 

Listed

 

Listed

 

Listed

 

Listed

 

 

 

 

 

 

 

Construction

 

Development

 

Redevelopment

 

Wholesale Data

 

Controlled

 

 

 

 

 

 

 

Projects

 

Projects

 

Projects

 

Center

 

Land Controlled

 

Other

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating properties

 

$

18,632

 

$

 

$

61,531

 

$

31,084

 

$

20,327

 

$

 

$

131,574

 

Land - development

 

20,928

 

14,000

 

5,599

 

5,377

 

207,462

 

139

 

253,505

 

Properties under construction and development, excluding associated land costs

 

85,477

 

16,469

 

44,293

 

117,513

 

113,916

 

18,502

 

396,170

 

Deferred leasing costs

 

1,838

 

 

3,603

 

 

 

441

 

5,882

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

126,875

 

$

30,469

 

$

115,026

 

$

153,974

 

$

341,705

 

$

19,082

 

$

787,131

 

 


(1) Including cost of land undergoing construction, development or redevelopment activities.

 

24



 

First Quarter 2011

 

2011 Office Property Construction Placed into Service

 

 

 

 

 

 

 

Total

 

Placed in

 

 

 

 

 

 

 

Rentable

 

Service in

 

 

 

 

 

 

 

Square

 

1st Quarter

 

Property and Location

 

Submarket

 

Ownership

 

Feet

 

2011

 

209 Research Boulevard

 

 

 

 

 

 

 

 

 

Aberdeen, Maryland

 

Harford County

 

Wholly owned

 

77,192

 

6,097

 

 

 

 

 

 

 

 

 

 

 

308 Sentinel Drive (308 NBP)

 

 

 

 

 

 

 

 

 

Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

151,207

 

120,080

 

 

 

 

 

 

 

 

 

 

 

Total Construction Placed Into Service

 

 

 

 

 

228,399

 

126,177

 

 

25



 

First Quarter 2011

 

Construction Leasing Progression Over Previous Five Quarters (1)

 

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rentable

 

Construction

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Square

 

Commencement

 

Cumulative Square Feet Leased as of

 

Property and Location

 

Submarket

 

Ownership

 

Feet

 

Date

 

3/31/2010

 

6/30/2010

 

9/30/2010

 

12/31/2010

 

3/31/2011

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

316 Sentinel Way (316 NBP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

125,044

 

1Q 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

324 Sentinel Way (324 NBP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

125,118

 

1Q 09

 

125,118

 

125,118

 

125,118

 

125,118

 

125,118

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7205 Riverwood Road

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Columbia, Maryland

 

Howard Co. Perimeter

 

Wholly owned

 

86,000

 

4Q 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8000 Potranco Road

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

San Antonio, Texas

 

San Antonio Northwest

 

Wholly owned

 

125,005

 

1Q 09

 

125,005

 

125,005

 

125,005

 

125,005

 

125,005

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8030 Potranco Road

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

San Antonio, Texas

 

San Antonio Northwest

 

Wholly owned

 

125,005

 

1Q 09

 

125,005

 

125,005

 

125,005

 

125,005

 

125,005

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Government

 

 

 

 

 

586,172

 

 

 

375,128

 

375,128

 

375,128

 

375,128

 

375,128

 

 

 

 

 

 

 

 

 

 

 

64

%

64

%

64

%

64

%

64

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

308 Sentinel Drive (308 NBP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

151,207

 

3Q 09

 

 

27,956

 

148,482

 

148,482

 

148,482

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

410 National Business Parkway

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

110,000

 

4Q 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

430 National Business Parkway

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

109,341

 

3Q 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

206 Research Boulevard

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aberdeen, Maryland

 

Harford County

 

Wholly owned

 

127,300

 

3Q 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

209 Research Boulevard

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aberdeen, Maryland

 

Harford County

 

Wholly owned

 

77,192

 

1Q 09

 

58,513

 

65,662

 

77,192

 

77,192

 

77,192

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

210 Research Boulevard

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aberdeen, Maryland

 

Harford County

 

Wholly owned

 

79,573

 

4Q 09

 

27,551

 

27,551

 

27,551

 

27,551

 

27,551

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

45310 Abell House Lane (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

California, MD

 

St. Mary’s County

 

Wholly owned

 

80,205

 

4Q 10

 

 

80,205

 

80,205

 

80,205

 

80,205

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

100 Sentry Gateway

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

San Antonio, Texas

 

San Antonio Northwest

 

Wholly owned

 

94,550

 

1Q 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1000 Redstone Gateway

 

 

 

Consolidated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Huntsville, Alabama

 

Huntsville

 

Joint Venture

 

115,000

 

1Q 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Defense Information Technology

 

 

 

 

 

944,368

 

 

 

86,064

 

201,374

 

333,430

 

333,430

 

333,430

 

 

 

 

 

 

 

 

 

 

 

9

%

21

%

35

%

35

%

35

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Development Leasing

 

 

 

 

 

1,530,540

 

 

 

461,192

 

576,502

 

708,558

 

708,558

 

708,558

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Percent Leased

 

 

 

 

 

 

 

 

 

30

%

38

%

46

%

46

%

46

%

 


(1) Includes properties with actual building shell construction completion in 2010 and actual or anticipated building shell construction completion in 2011.

(2) We acquired this property in August 2010.

 

26



 

First Quarter 2011

 

Wholesale Data Center Summary

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Actual or

 

 

 

 

 

 

 

 

 

 

 

Initial

 

Critical Load

 

 

 

 

 

 

 

Anticipated

 

 

 

 

 

 

 

 

 

Raised Floor

 

Stabilization

 

Upon

 

 

 

Anticipated

 

 

 

Construction

 

Anticipated

 

NOI for

 

 

 

Gross Building

 

Square

 

Critical Load

 

Completion

 

MW

 

Total

 

Cost

 

Completion

 

Operational

 

Three Months

 

Property and Location

 

Area

 

Footage (1)

 

(in MWs) (2)

 

Leased

 

Operational

 

Cost (3)

 

to date

 

Date (4)

 

Date (5)

 

Ended 3/31/11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Power Loft @ Innovation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

9651 Hornbaker Road

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Manassas, Virginia

 

233,000

 

100,000

 

18

 

17

%

11

%

$

282,000

 

$

153,974

 

4Q 12

 

4Q 12

 

$

504

 

 

Lease Expiration Analysis

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

Number

 

 

 

 

 

 

 

Annual Rental

 

 

 

of Leases

 

Raised Floor

 

Critical Load

 

Critical Load

 

Revenue of

 

Year of Lease Expiration

 

Expiring

 

Square Footage

 

Leased (MW)

 

Used (MW)

 

Expiring Leases

 

 

 

 

 

 

 

 

 

 

 

 

 

2019

 

1

 

7,172

 

1

 

1

 

$

2,057

 

2020

 

1

 

19,023

 

2

 

1

 

2,084

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3

 

2

 

$

4,141

 

 


(1) Raised floor square footage is that portion of the gross building area where tenants locate their computer servers.  Raised floor area is considered to be the net rentable square footage.

(2) Critical load is the power available for exclusive use of tenants in the property (expressed in terms of megawatts (“MWs”)).

(3) Anticipated total cost includes land, construction and leasing costs.

(4) Actual or anticipated construction completion date is the estimated date of completion of the building shell and equipment fit-out.

(5) Anticipated operational date is the estimated date when leases have commenced on 100% of a property’s space or one year from the cessation of major construction activities. 

 

27



 

First Quarter 2011

 

Quarterly Common Equity Analysis

(Dollars and shares in thousands, except per share amounts)

 

 

 

 

 

 

 

As if Converted

 

 

 

Diluted

 

SHAREHOLDER CLASSIFICATION

 

Common

 

Common

 

Preferred

 

 

 

Ownership

 

As of March 31, 2011:

 

Shares

 

Units

 

Shares/Units

 

Total

 

% of Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Insiders

 

1,077,963

 

3,738,427

 

0

 

4,816,390

 

6.68

%

Non-insiders

 

66,025,955

 

647,575

 

610,014

 

67,283,544

 

93.32

%

 

 

67,103,918

 

4,386,002

 

610,014

 

72,099,934

 

100.00

%

 

 

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

COMMON EQUITY - End of Quarter

 

 

 

 

 

 

 

 

 

 

 

Common Shares

 

67,104

 

66,932

 

59,406

 

59,288

 

58,927

 

Common Units

 

4,386

 

4,403

 

4,446

 

4,456

 

4,757

 

Total

 

71,490

 

71,334

 

63,852

 

63,744

 

63,684

 

End of Quarter Common Share Price

 

$

36.14

 

$

34.95

 

$

37.31

 

$

37.76

 

$

40.13

 

Market Value of Common Shares/Units

 

$

2,583,646

 

$

2,493,134

 

$

2,382,318

 

$

2,406,973

 

$

2,555,639

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Shares Trading Volume

 

 

 

 

 

 

 

 

 

 

 

Average Daily Volume (Shares)

 

711

 

784

 

728

 

887

 

654

 

Average Daily Volume

 

$

25,009

 

$

27,910

 

$

27,241

 

$

35,095

 

$

24,583

 

As a Percentage of Weighted Average Common Shares

 

1.1

%

1.2

%

1.2

%

1.5

%

1.1

%

 

 

 

 

 

 

 

 

 

 

 

 

Common Share Price Range (price per share)

 

 

 

 

 

 

 

 

 

 

 

Quarterly High

 

$

36.90

 

$

38.96

 

$

39.85

 

$

43.61

 

$

42.44

 

Quarterly Low

 

$

33.83

 

$

33.33

 

$

35.04

 

$

34.82

 

$

32.69

 

Quarterly Average

 

$

35.23

 

$

35.59

 

$

37.44

 

$

39.58

 

$

37.57

 

 

28



 

First Quarter 2011

 

Quarterly Preferred Equity and Total Market Capitalization Analysis

(dollars and shares in thousands, except per share amounts)

 

 

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

PREFERRED EQUITY

 

 

 

 

 

 

 

 

 

 

 

Convertible Preferred Equity - End of Quarter

 

 

 

 

 

 

 

 

 

 

 

Convertible Series I Preferred Units Outstanding

 

352

 

352

 

352

 

352

 

352

 

Conversion Ratio

 

0.5000

 

0.5000

 

0.5000

 

0.5000

 

0.5000

 

Common Shares Issued Assuming Conversion

 

176

 

176

 

176

 

176

 

176

 

 

 

 

 

 

 

 

 

 

 

 

 

Convertible Series K Preferred Shares Outstanding

 

532

 

532

 

532

 

532

 

532

 

Conversion Ratio

 

0.8163

 

0.8163

 

0.8163

 

0.8163

 

0.8163

 

Common Shares Issued Assuming Conversion

 

434

 

434

 

434

 

434

 

434

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonconvertible Preferred Equity - End of Quarter

 

 

 

 

 

 

 

 

 

 

 

Redeemable Series G Shares Outstanding

 

2,200

 

2,200

 

2,200

 

2,200

 

2,200

 

Redeemable Series H Shares Outstanding

 

2,000

 

2,000

 

2,000

 

2,000

 

2,000

 

Redeemable Series J Shares Outstanding

 

3,390

 

3,390

 

3,390

 

3,390

 

3,390

 

 Total Nonconvertible Preferred Equity

 

7,590

 

7,590

 

7,590

 

7,590

 

7,590

 

Convertible Preferred Equity

 

 

 

 

 

 

 

 

 

 

 

Convertible Series K Shares Outstanding

 

884

 

884

 

884

 

884

 

884

 

 Total Preferred Equity

 

8,474

 

8,474

 

8,474

 

8,474

 

8,474

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonconvertible Preferred Equity ($25 par value)

 

 

 

 

 

 

 

 

 

 

 

Redeemable Series G Shares

 

$

55,000

 

$

55,000

 

$

55,000

 

$

55,000

 

$

55,000

 

Redeemable Series H Shares

 

50,000

 

50,000

 

50,000

 

50,000

 

50,000

 

Redeemable Series J Shares

 

84,750

 

84,750

 

84,750

 

84,750

 

84,750

 

 Total Nonconvertible Preferred Equity

 

$

189,750

 

$

189,750

 

$

189,750

 

$

189,750

 

$

189,750

 

 

 

 

 

 

 

 

 

 

 

 

 

Convertible Preferred Equity ($25 liquidation value)

 

 

 

 

 

 

 

 

 

 

 

Convertible Series I Units

 

$

8,800

 

$

8,800

 

$

8,800

 

$

8,800

 

$

8,800

 

Convertible Preferred Equity ($50 liquidation value)

 

 

 

 

 

 

 

 

 

 

 

Convertible Series K Shares

 

26,583

 

26,583

 

26,583

 

26,583

 

26,583

 

Total Convertible Preferred Equity

 

$

35,383

 

$

35,383

 

$

35,383

 

$

35,383

 

$

35,383

 

Total Liquidation Value of Preferred Equity

 

$

225,133

 

$

225,133

 

$

225,133

 

$

225,133

 

$

225,133

 

 

 

 

 

 

 

 

 

 

 

 

 

CAPITALIZATION

 

 

 

 

 

 

 

 

 

 

 

Liquidation Value of Preferred Shares/Units

 

$

225,133

 

$

225,133

 

$

225,133

 

$

225,133

 

$

225,133

 

Market Value of Common Shares/Units

 

2,583,646

 

2,493,134

 

2,382,318

 

2,406,973

 

2,555,639

 

Total Equity Market Capitalization

 

$

2,808,779

 

$

2,718,267

 

$

2,607,451

 

$

2,632,107

 

$

2,780,772

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Debt

 

$

2,396,795

 

$

2,323,681

 

$

2,468,419

 

$

2,182,375

 

$

2,107,131

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Market Capitalization

 

$

5,205,574

 

$

5,041,948

 

$

5,075,870

 

$

4,814,482

 

$

4,887,903

 

 

29



 

First Quarter 2011

 

Dividend Analysis

 

 

 

Three Months Ended

 

 

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

Common Share Dividends

 

 

 

 

 

 

 

 

 

 

 

Dividends per share/unit

 

$

0.4125

 

$

0.4125

 

$

0.4125

 

$

0.3925

 

$

0.3925

 

Increase over prior period

 

0.0

%

0.0

%

5.1

%

0.0

%

0.0

%

 

 

 

 

 

 

 

 

 

 

 

 

Common Dividend Payout Ratios

 

 

 

 

 

 

 

 

 

 

 

Diluted FFO Payout, as adjusted for comparability

 

79.2

%

61.7

%

71.3

%

73.2

%

75.2

%

 

 

 

 

 

 

 

 

 

 

 

 

Diluted AFFO Payout

 

142.4

%

95.0

%

89.3

%

92.6

%

99.2

%

 

 

 

 

 

 

 

 

 

 

 

 

Dividend Coverage - Diluted FFO, as adjusted for comparability

 

1.26

x

1.62

x

1.40

x

1.37

x

1.33

x

 

 

 

 

 

 

 

 

 

 

 

 

Dividend Coverage - Diluted AFFO

 

0.70

x

1.05

x

1.12

x

1.08

x

1.01

x

 

 

 

 

 

 

 

 

 

 

 

 

Common Dividend Yields

 

 

 

 

 

 

 

 

 

 

 

Dividend Yield at Quarter End

 

4.57

%

4.72

%

4.42

%

4.16

%

3.91

%

 

 

 

 

 

 

 

 

 

 

 

 

Series I Preferred Unit Distributions

 

 

 

 

 

 

 

 

 

 

 

Preferred Unit Distributions Per Unit

 

$

0.46875

 

$

0.46875

 

$

0.46875

 

$

0.46875

 

$

0.46875

 

Preferred Unit Distributions Yield

 

7.500

%

7.500

%

7.500

%

7.500

%

7.500

%

Quarter End Recorded Book Value

 

$

25.00

 

$

25.00

 

$

25.00

 

$

25.00

 

$

25.00

 

 

 

 

 

 

 

 

 

 

 

 

 

Series G Preferred Share Dividends

 

 

 

 

 

 

 

 

 

 

 

Preferred Share Dividends Per Share

 

$

0.50000

 

$

0.50000

 

$

0.50000

 

$

0.50000

 

$

0.50000

 

Preferred Share Dividend Yield

 

8.000

%

8.000

%

8.000

%

8.000

%

8.000

%

Quarter End Recorded Book Value

 

$

25.00

 

$

25.00

 

$

25.00

 

$

25.00

 

$

25.00

 

 

 

 

 

 

 

 

 

 

 

 

 

Series H Preferred Share Dividends

 

 

 

 

 

 

 

 

 

 

 

Preferred Share Dividends Per Share

 

$

0.46875

 

$

0.46875

 

$

0.46875

 

$

0.46875

 

$

0.46875

 

Preferred Share Dividend Yield

 

7.500

%

7.500

%

7.500

%

7.500

%

7.500

%

Quarter End Recorded Book Value

 

$

25.00

 

$

25.00

 

$

25.00

 

$

25.00

 

$

25.00

 

 

 

 

 

 

 

 

 

 

 

 

 

Series J Preferred Share Dividends

 

 

 

 

 

 

 

 

 

 

 

Preferred Share Dividends Per Share

 

$

0.47656

 

$

0.47656

 

$

0.47656

 

$

0.47656

 

$

0.47656

 

Preferred Share Dividend Yield

 

7.625

%

7.625

%

7.625

%

7.625

%

7.625

%

Quarter End Recorded Book Value

 

$

25.00

 

$

25.00

 

$

25.00

 

$

25.00

 

$

25.00

 

 

 

 

 

 

 

 

 

 

 

 

 

Series K Preferred Share Dividends

 

 

 

 

 

 

 

 

 

 

 

Preferred Share Dividends Per Share

 

$

0.70000

 

$

0.70000

 

$

0.70000

 

$

0.70000

 

$

0.70000

 

Preferred Share Dividend Yield

 

5.600

%

5.600

%

5.600

%

5.600

%

5.600

%

Quarter End Recorded Book Value

 

$

50.00

 

$

50.00

 

$

50.00

 

$

50.00

 

$

50.00

 

 

30



 

First Quarter 2011

 

Debt Analysis

(dollars in thousands)

 

 

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

Debt Outstanding

 

 

 

 

 

 

 

 

 

 

 

Mortgage Loans

 

$

1,484,892

 

$

1,485,860

 

$

1,449,817

 

$

1,432,544

 

$

1,452,845

 

Construction Loans (1)

 

178,365

 

159,092

 

138,655

 

119,640

 

100,225

 

Unsecured Revolving Credit Facility (2)

 

348,000

 

295,000

 

498,000

 

250,000

 

397,000

 

Exchangeable Senior Notes

 

385,538

 

383,729

 

381,947

 

380,191

 

157,061

 

 

 

$

2,396,795

 

$

2,323,681

 

$

2,468,419

 

$

2,182,375

 

$

2,107,131

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Rate Data

 

 

 

 

 

 

 

 

 

 

 

Fixed-Mortgage Loans

 

$

1,174,656

 

$

1,175,305

 

$

1,179,060

 

$

1,161,652

 

$

1,165,073

 

Fixed-Exchangeable Senior Notes

 

385,538

 

383,729

 

381,947

 

380,191

 

157,061

 

Variable Rate Loans

 

426,849

 

504,712

 

687,412

 

420,532

 

564,997

 

Variable Rate Loans Subject to Interest Rate Swaps (3)

 

409,752

 

259,935

 

220,000

 

220,000

 

220,000

 

 

 

$

2,396,795

 

$

2,323,681

 

$

2,468,419

 

$

2,182,375

 

$

2,107,131

 

 

 

 

 

 

 

 

 

 

 

 

 

% of Fixed Rate Loans (3)

 

82.19

%

78.28

%

72.15

%

80.73

%

73.19

%

% of Variable Rate Loans (3)

 

17.81

%

21.72

%

27.85

%

19.27

%

26.81

%

 

 

100.00

%

100.00

%

100.00

%

100.00

%

100.00

%

 

 

 

Three Months Ended

 

 

 

3/31/2011

 

12/31/2010

 

9/30/2010

 

6/30/2010

 

3/31/2010

 

Average Contract Interest Rates

 

 

 

 

 

 

 

 

 

 

 

Mortgage & Construction Loans

 

5.26

%

5.30

%

5.39

%

5.43

%

5.45

%

Unsecured Revolving Credit Facility (4)

 

2.18

%

2.07

%

2.19

%

2.53

%

1.93

%

Exchangeable Senior Notes (5)

 

3.95

%

3.95

%

3.95

%

3.95

%

3.50

%

Total Weighted Average

 

4.91

%

4.92

%

5.06

%

5.26

%

4.83

%

 

 

 

 

 

 

 

 

 

 

 

 

Debt ratios (coverage ratios excluding capitalized interest) – All coverage computations include the effect of discontinued operations

 

 

 

 

 

 

 

 

 

 

 

NOI interest coverage ratio

 

3.03

x

3.24

x

3.01

x

3.05

x

3.11

x

Adjusted EBITDA interest coverage ratio

 

2.93

x

3.36

x

2.85

x

2.85

x

2.97

x

NOI debt service coverage ratio

 

2.61

x

2.81

x

2.62

x

2.64

x

2.67

x

Adjusted EBITDA debt service coverage ratio

 

2.52

x

2.92

x

2.49

x

2.47

x

2.54

x

NOI fixed charge coverage ratio

 

2.57

x

2.75

x

2.55

x

2.57

x

2.59

x

Adjusted EBITDA fixed charge coverage ratio

 

2.49

x

2.86

x

2.42

x

2.41

x

2.47

x

Debt to Adjusted EBITDA ratio (6)

 

8.66

x

7.29

x

9.21

x

8.36

x

8.54

x

Adjusted debt to Adjusted EBITDA ratio (7)

 

7.23

x

6.08

x

7.93

x

7.14

x

7.25

x

 


(1)

Includes $161.6 million due under our Revolving Construction Facility at March 31, 2011. This facility provides for the borrowing of up to $225.0 million to finance construction of the Company’s wholly owned buildings.

(2)

As of March 31, 2011, our borrowing capacity under the Revolving Credit Facility was $800.0 million, of which $447.8 million was available.

(3)

Includes the effect of interest rate swaps in effect during certain of the periods set forth above that hedge the risk of changes in interest rates on certain of our one-month LIBOR-based variable rate debt.

(4)

Includes effect of interest expense incurred on interest rate swaps.

(5)

Represents the weighted average of the stated interest rates on our Exchangeable Senior Notes.

(6)

Represents debt divided by Adjusted EBITDA for the three month period multiplied by four.

(7)

Represents debt adjusted to subtract construction in progress as of period end divided by Adjusted EBITDA for the three month period multiplied by four.

 

31



 

First Quarter 2011

 

Debt Maturity Schedule

(dollars in thousands)

 

 

 

Non-Recourse Debt (1) 

 

Recourse Debt (1)

 

 

 

 

 

Year of Maturity

 

Annual
Amortization of
Monthly
Payments

 

Balloon
Payments Due
on Maturity

 

Weighted
Average
Interest Rate of
Amounts
Maturing 

 

Annual
Amortization of
Monthly
Payments

 

Balloon
Payments Due
on Maturity

 

Weighted
Average Interest
Rate of Amounts
Maturing 

 

Revolver (2)

 

Total Scheduled
Payments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

April - June

 

$

 3,609

 

$

      —

 

N/A

 

$

    246

 

$

    16,753

 

3.02

%

$

      —

 

$

 20,608

 

July - September

 

3,479

 

102,264

 

5.47

%

257

 

 

N/A

 

348,000

 

454,000

 

October - December

 

3,186

 

 

N/A

 

258

 

 

N/A

 

 

3,444

 

Total 2011 (3)

 

$

  10,274

 

$

 102,264

 

5.47

%

$

  761

 

$

  16,753

 

3.02

%

$

 348,000

 

$

 478,052

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2012 (4)

 

12,802

 

257,523

 

 

 

1,065

 

161,613

 

 

 

 

433,003

 

2013

 

10,075

 

134,843

 

 

 

1,131

 

 

 

 

 

146,049

 

2014 (5)

 

6,688

 

175,931

 

 

 

840

 

26,766

 

 

 

 

210,225

 

2015

 

5,208

 

135,734

 

 

 

530

 

19,000

 

 

 

 

160,472

 

2016

 

3,481

 

274,605

 

 

 

556

 

 

 

 

 

278,642

 

2017

 

193

 

300,610

 

 

 

585

 

 

 

 

 

301,388

 

2018

 

 

 

 

 

617

 

 

 

 

 

617

 

2019

 

 

 

 

 

573

 

39

 

 

 

 

612

 

2020

 

 

 

 

 

200

 

 

 

 

 

200

 

2021

 

 

 

 

 

200

 

 

 

 

 

200

 

2022

 

 

 

 

 

200

 

 

 

 

 

200

 

2023

 

 

 

 

 

200

 

 

 

 

 

200

 

2024

 

 

 

 

 

200

 

 

 

 

 

200

 

2025

 

 

 

 

 

200

 

 

 

 

 

200

 

2026

 

 

 

 

 

50

 

11

 

 

 

 

61

 

 

 

$

   48,721

 

$

  1,381,510

 

 

 

$

     7,908

 

$

 224,182

 

 

 

$

 348,000

 

$

 2,010,321

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net premium

 

 

 

 

 

 

 

936

 

 

 

 

 

Mortgage and Other Loans Payable

 

 

 

 

 

 

 

$

2,011,257

 

 

 

 

 

 

 

 

 

 

3.5

%

 

4.25

%

 

 

 

 

 

 

 

Exchangeable Senior Notes-Face Amount

 

 

 

$

162,500

 

$

240,000

 

$

402,500

 

 

 

 

 

Net discount

 

 

 

(1,648

)

(15,314

)

(16,962

)

 

 

 

 

Exchangeable Senior Notes (6)

 

 

 

$

160,852

 

$

224,686

 

385,538

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Debt

 

 

 

 

 

 

 

$

2,396,795

 

 

Notes:

 


(1)

Certain mortgages contain extension options, generally either for a period of six months or one year, subject to certain conditions. The maturity dates presented above in the table assume that the extension options have not been exercised.

 

 

(2)

As of March 31, 2011, our borrowing capacity under the Revolving Credit Facility was $800.0 million, of which $447.8 million was available.

 

 

(3)

Includes $348.0 million due under our Revolving Credit Facility at March 31, 2011 that may be extended by us for a one-year period, subject to certain conditions.

 

 

(4)

Includes $161.6 million due under our Revolving Construction Facility at March 31, 2011. This facility provides for borrowings of up to $225.0 million to finance construction of the Company’s wholly owned buildings.

 

 

(5)

We have $73.9 million of nonrecourse debt maturing in 2034 that may be prepaid in 2014, subject to certain conditions. The above table includes $69.2 million in maturities on these loans in 2014.

 

 

(6)

3.5% Exchangeable Senior Notes mature in September 2026 but are subject to a put by the holders in September 2011 and every five years thereafter. 4.25% Exchangeable Senior Notes mature in April 2030 but are subject to a put by the holders in April 2015 and every five years thereafter.

 

32



 

First Quarter 2011

 

Summary of Consolidated Joint Ventures

(dollars in thousands)

 

 

 

Operational

 

 

 

Total

 

Property Level

 

% COPT

 

Operating Properties

 

Square Feet

 

Occupancy

 

Assets (1)

 

Debt

 

Owned

 

Baltimore/Washington Corridor:

 

 

 

 

 

 

 

 

 

 

 

7740 Milestone Parkway

 

143,823

 

6.0

%

$

28,087

 

$

16,753

 

50.0

%

 

 

 

 

 

 

 

 

 

 

 

 

Suburban Maryland:

 

 

 

 

 

 

 

 

 

 

 

4230 Forbes Boulevard

 

55,866

 

92.0

%

4,003

 

 

50.0

%

M Square - operating properties

 

 

 

 

 

55,410

 

39,752

 

50.0

%

5825 University Research Drive

 

118,620

 

74.8

%

 

 

 

 

 

 

5850 University Research Drive

 

123,449

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total/Average

 

441,758

 

61.6

%

$

87,500

 

$

56,505

 

 

 

 

 

 

 

 

Estimated

 

 

 

 

 

 

 

 

 

 

 

Developable

 

Total

 

Property-Level

 

% COPT

 

Non-operational Properties

 

 

 

Square Feet

 

Assets (1)

 

Debt

 

Owned

 

Baltimore/Washington Corridor:

 

 

 

 

 

 

 

 

 

 

 

7742-7874 Milestone Parkway

 

 

 

1,652,000

 

$

4,893

 

 

50.0

%

 

 

 

 

 

 

 

 

 

 

 

 

Suburban Maryland:

 

 

 

 

 

 

 

 

 

 

 

Indian Head Technology Center Business Park

 

 

 

967,000

 

7,486

 

 

75.0

%

M Square Research Park

 

 

 

510,000

 

5,048

 

 

50.0

%

 

 

 

 

 

 

 

 

 

 

 

 

Huntsville, AL:

 

 

 

 

 

 

 

 

 

 

 

Redstone Gateway

 

 

 

4,595,000

 

21,070

 

 

85.0

%

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

7,724,000

 

$

38,497

 

$

 

 

 

 


(1)          Total assets includes any outside investment basis related to the applicable joint venture and related joint ventures (formed and to be formed) plus the total assets recorded on the books of the consolidated joint venture.

 

33



 

First Quarter 2011

 

Summary of Unconsolidated Joint Venture

(dollars in thousands)

 

 

 

Operational

 

 

 

Property and Location

 

Square Feet

 

Occupancy

 

Greater Harrisburg:

 

 

 

 

 

2605 Interstate Drive

 

79,456

 

100.0

%

6345 Flank Drive

 

69,443

 

63.0

%

6340 Flank Drive

 

68,200

 

100.0

%

2601 Market Place

 

65,411

 

90.0

%

6400 Flank Drive

 

56,556

 

100.0

%

6360 Flank Drive

 

52,439

 

29.6

%

6385 Flank Drive

 

46,589

 

46.1

%

6380 Flank Drive

 

32,671

 

89.1

%

6405 Flank Drive

 

32,668

 

80.6

%

95 Shannon Road

 

32,000

 

0.0

%

75 Shannon Road

 

31,710

 

36.4

%

6375 Flank Drive

 

28,347

 

82.0

%

85 Shannon Road

 

21,976

 

100.0

%

5035 Ritter Road

 

20,887

 

0.0

%

5070 Ritter Road - Building A

 

19,783

 

71.3

%

5070 Ritter Road - Building B

 

12,863

 

100.0

%

 

 

 

 

 

 

Total/Average

 

670,999

 

72.0

%

 

 

 

 

 

 

COPT Investment

 

$

(5,686

)

 

 

Total Assets

 

$

65,160

 

 

 

Property Level Debt

 

$

65,424

 

 

 

% COPT Owned

 

20.0

%

 

 

 

34



 

First Quarter 2011

 

Supplementary Reconciliations of Non-GAAP Measures

(in thousands)

 

 

 

Three Months Ended

 

 

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income

 

$

(18,566

)

$

16,752

 

$

8,926

 

$

9,151

 

$

10,675

 

Interest expense on continuing and discontinued operations

 

26,928

 

26,878

 

26,626

 

25,921

 

22,703

 

Total income tax (benefit) expense

 

(544

)

33

 

27

 

7

 

52

 

Depreciation of furniture, fixtures and equipment (FF&E)

 

625

 

642

 

652

 

632

 

650

 

Real estate-related depreciation and amortization

 

33,020

 

35,347

 

30,745

 

29,548

 

27,603

 

Impairment loss

 

27,742

 

 

 

 

 

Adjusted EBITDA

 

$

69,205

 

$

79,652

 

$

66,976

 

$

65,259

 

$

61,683

 

Add back:

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

6,777

 

6,103

 

6,079

 

5,926

 

5,900

 

Business development

 

488

 

691

 

2,886

 

465

 

155

 

Depreciation of FF&E

 

(625

)

(642

)

(652

)

(632

)

(650

)

Income from construction contracts and other service operations

 

(410

)

(483

)

(261

)

(663

)

(966

)

Interest and other income

 

(1,168

)

(7,626

)

(395

)

(245

)

(1,302

)

Gain on sales of operating properties

 

 

4

 

(784

)

 

(297

)

Non-operational property sales

 

(2,701

)

 

(2,477

)

(335

)

(28

)

Equity in (income) loss of unconsolidated entities

 

(30

)

(1,005

)

(648

)

72

 

205

 

NOI

 

$

71,536

 

$

76,694

 

$

70,724

 

$

69,847

 

$

64,700

 

 

 

 

 

 

 

 

 

 

 

 

 

Discontinued Operations

 

 

 

 

 

 

 

 

 

 

 

Revenues from real estate operations

 

$

74

 

$

(52

)

$

478

 

$

734

 

$

768

 

Property operating expenses

 

 

 

(44

)

(139

)

(161

)

Depreciation and amortization

 

 

 

 

 

(7

)

Interest

 

 

 

(89

)

(109

)

(65

)

Gain on sales of depreciated real estate properties

 

 

(4

)

784

 

 

297

 

Discontinued operations

 

$

74

 

$

(56

)

$

1,129

 

$

486

 

$

832

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sales of real estate, net, per statements of operations

 

$

2,701

 

$

 

$

2,477

 

$

335

 

$

17

 

Add income taxes

 

 

 

 

 

11

 

Gain on sales of real estate from discontinued operations

 

 

(4

)

784

 

 

297

 

Gain on sales of real estate from continuing and discontinued operations

 

2,701

 

(4

)

3,261

 

335

 

325

 

Gain on sales of non-operating properties

 

(2,701

)

 

(2,477

)

(335

)

(28

)

Gain on sales of operating properties

 

$

 

$

(4

)

$

784

 

$

 

$

297

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Average Shares for quarter ended:

 

 

 

 

 

 

 

 

 

 

 

Common Shares Outstanding

 

66,340

 

63,404

 

58,656

 

58,489

 

57,844

 

Dilutive effect of share-based compensation awards

 

261

 

236

 

296

 

421

 

364

 

Common Units

 

4,396

 

4,412

 

4,453

 

4,558

 

5,017

 

Denominator for FFO per share - diluted

 

70,997

 

68,052

 

63,405

 

63,468

 

63,225

 

 

 

 

 

 

 

 

 

 

 

 

 

Denominator for diluted EPS

 

66,340

 

63,640

 

58,952

 

58,910

 

58,208

 

Anti-dilutive EPS effect of share-based compensation awards

 

261

 

 

 

 

 

Weighted average common units

 

4,396

 

4,412

 

4,453

 

4,558

 

5,017

 

Denominator for diluted FFO per share

 

70,997

 

68,052

 

63,405

 

63,468

 

63,225

 

 

35



 

First Quarter 2011

 

Supplementary Reconciliations of Non-GAAP Measures (continued)

(dollars in thousands)

 

 

 

Three Months Ended

 

 

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

3/31/10

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Assets or Denominator for Debt to Total Assets

 

$

3,865,809

 

$

3,844,517

 

$

3,737,372

 

$

3,467,283

 

$

3,398,352

 

Accumulated depreciation

 

526,825

 

503,032

 

479,218

 

464,408

 

443,246

 

Intangible assets on real estate acquisitions, net

 

106,444

 

113,735

 

123,307

 

96,151

 

94,925

 

Assets other than assets included in properties, net

 

(397,038

)

(399,062

)

(388,222

)

(336,769

)

(333,390

)

Denominator for Debt to Undepreciated Book Value of Real Estate Assets

 

$

4,102,040

 

$

4,062,222

 

$

3,951,675

 

$

3,691,073

 

$

3,603,133

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP revenues from real estate operations from continuing operations

 

$

122,367

 

$

123,765

 

$

114,550

 

$

109,257

 

$

112,228

 

Revenues from discontinued operations

 

74

 

(52

)

478

 

734

 

768

 

Real estate revenues from continuing and discontinued operations

 

$

122,441

 

$

123,713

 

$

115,028

 

$

109,991

 

$

112,996

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP revenues from real estate operations from continuing operations

 

$

122,367

 

$

123,765

 

$

114,550

 

$

109,257

 

$

112,228

 

Property operating expenses

 

(50,905

)

(47,019

)

(44,260

)

(40,005

)

(48,135

)

Revenues from discontinued operations

 

74

 

(52

)

478

 

734

 

768

 

Property operating expenses from discontinued operations

 

 

 

(44

)

(139

)

(161

)

NOI

 

$

71,536

 

$

76,694

 

$

70,724

 

$

69,847

 

$

64,700

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization assoc. with real estate operations from continuing operations

 

$

33,020

 

$

35,347

 

$

30,745

 

$

29,548

 

$

27,596

 

Depreciation and amortization from discontinued operations

 

 

 

 

 

7

 

Real estate-related depreciation and amortization

 

$

33,020

 

$

35,347

 

$

30,745

 

$

29,548

 

$

27,603

 

 

 

 

 

 

 

 

 

 

 

 

 

Total tenant improvements and incentives on operating properties

 

$

13,270

 

$

8,761

 

$

7,789

 

$

4,630

 

$

4,071

 

Total capital improvements on operating properties

 

1,990

 

6,879

 

1,717

 

1,524

 

870

 

Total leasing costs for operating properties

 

2,736

 

4,573

 

2,004

 

1,350

 

1,338

 

Less: Nonrecurring tenant improvements and incentives on operating properties

 

(2,448

)

(3,003

)

(1,067

)

(136

)

(77

)

Less: Nonrecurring capital improvements on operating properties

 

(610

)

(1,342

)

(171

)

(293

)

(60

)

Less: Nonrecurring leasing costs for operating properties

 

(616

)

10

 

(120

)

(3

)

54

 

Add: Recurring capital expenditures on operating properties held through joint ventures

 

22

 

82

 

4

 

8

 

15

 

Recurring capital expenditures

 

$

14,344

 

$

15,960

 

$

10,156

 

$

7,080

 

$

6,211

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense from continuing operations

 

$

26,928

 

$

26,878

 

$

26,537

 

$

25,812

 

$

22,638

 

Interest expense from discontinued operations

 

 

 

89

 

109

 

65

 

Total interest expense

 

$

26,928

 

$

26,878

 

$

26,626

 

$

25,921

 

$

22,703

 

Less: Amortization of deferred financing costs

 

(1,759

)

(1,696

)

(1,554

)

(1,495

)

(1,126

)

Less: Amortization of discount on Exchangeable Senior Notes, net of amounts capitalized

 

(1,558

)

(1,503

)

(1,541

)

(1,488

)

(782

)

Denominator for interest coverage

 

$

23,611

 

$

23,679

 

$

23,531

 

$

22,938

 

$

20,795

 

Scheduled principal amortization

 

3,798

 

3,607

 

3,420

 

3,500

 

3,469

 

Denominator for debt service coverage

 

$

27,409

 

$

27,286

 

$

26,951

 

$

26,438

 

$

24,264

 

Scheduled principal amortization

 

(3,798

)

(3,607

)

(3,420

)

(3,500

)

(3,469

)

Preferred dividends - redeemable non-convertible

 

4,025

 

4,026

 

4,025

 

4,026

 

4,025

 

Preferred distributions

 

165

 

165

 

165

 

165

 

165

 

Denominator for fixed charge coverage

 

$

27,801

 

$

27,870

 

$

27,721

 

$

27,129

 

$

24,985

 

 

 

 

 

 

 

 

 

 

 

 

 

Preferred dividends

 

$

4,025

 

$

4,026

 

$

4,025

 

$

4,026

 

$

4,025

 

Preferred distributions

 

165

 

165

 

165

 

165

 

165

 

Common distributions

 

1,809

 

1,816

 

1,834

 

1,749

 

1,867

 

Common dividends

 

27,704

 

27,597

 

24,494

 

23,259

 

23,160

 

Total dividends/distributions

 

$

33,703

 

$

33,604

 

$

30,518

 

$

29,199

 

$

29,217

 

 

 

 

 

 

 

 

 

 

 

 

 

Common share dividends

 

$

27,704

 

$

27,597

 

$

24,494

 

$

23,259

 

$

23,160

 

Common unit distributions

 

1,809

 

1,816

 

1,834

 

1,749

 

1,867

 

Dividends and distributions for FFO and AFFO payout ratios

 

$

29,513

 

$

29,413

 

$

26,328

 

$

25,008

 

$

25,027

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt, net

 

$

2,396,795

 

$

2,323,681

 

$

2,468,419

 

$

2,182,375

 

$

2,107,131

 

Less: Construction in progress

 

(396,170

)

(386,195

)

(344,924

)

(319,846

)

(317,283

)

Adjusted debt for adjusted debt to EBITDA ratio

 

$

2,000,625

 

$

1,937,486

 

$

2,123,495

 

$

1,862,529

 

$

1,789,848

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (benefit) tax expense from continuing operations

 

$

(544

)

$

33

 

$

27

 

$

7

 

$

41

 

Income tax (benefit) expense from gain on other sales of real estate

 

 

 

 

 

11

 

Total income tax expense

 

$

(544

)

$

33

 

$

27

 

$

7

 

$

52

 

 

36



 

First Quarter 2011

 

Definitions

 

Non-GAAP Measures

 

We believe that the measures defined below that are not determined in accordance with generally accepted accounting principals (“GAAP”) are helpful to investors in measuring our performance and comparing it to that of other real estate investment trusts (“REITs”).  Since these measures exclude certain items includable in their respective most comparable GAAP measures, reliance on the measures has limitations; management compensates for these limitations by using the measures simply as supplemental measures that are weighed in balance with other GAAP and non-GAAP measures.  These measures are not necessarily indications of our cash flow available to fund cash needs.  Additionally, they should not be used as an alternative to the respective most comparable GAAP measures when evaluating our financial performance or to cash flow from operating, investing and financing activities when evaluating our liquidity or ability to make cash distributions or pay debt service.

 

Funds from operations (“FFO” or “FFO per NAREIT”)

 

Defined as net (loss) income computed using GAAP, excluding gains on sales of previously depreciated operating properties, plus real estate-related depreciation and amortization.  Gains from sales of newly-developed properties less accumulated depreciation, if any, required under GAAP are included in FFO on the basis that development services are the primary revenue generating activity; we believe that inclusion of these development gains is in accordance with the National Association of Real Estate Investment Trust’s (“NAREIT”) definition of FFO, although others may interpret the definition differently and, accordingly, our presentation of FFO may differ from those of other REITs.  We believe that FFO is useful to management and investors as a supplemental measure of operating performance because, by excluding gains related to sales of previously depreciated operating properties and excluding real estate-related depreciation and amortization, FFO can help one compare our operating performance between periods.  We believe that net (loss) income is the most directly comparable GAAP measure to FFO.

 

Basic FFO available to common share and common unit holders (“Basic FFO”)

 

This measure is FFO adjusted to subtract (1) preferred share dividends, (2) income attributable to noncontrolling interests through ownership of preferred units in Corporate Office Properties, L.P. (the “Operating Partnership”) or interests in other consolidated entities not owned by us, (3) depreciation and amortization allocable to noncontrolling interests in other consolidated entities, (4) Basic FFO allocable to restricted shares and (5) issuance costs associated with redeemed preferred shares.  With these adjustments, Basic FFO represents FFO available to common shareholders and holders of common units in the Operating Partnership (“common units”).  Common units are substantially similar to our common shares of beneficial interest (“common shares”) and are exchangeable into common shares, subject to certain conditions.  We believe that Basic FFO is useful to investors due to the close correlation of common units to common shares.  We believe that net (loss) income is the most directly comparable GAAP measure to Basic FFO.

 

Diluted FFO available to common share and common unit holders (“Diluted FFO”)

 

Diluted FFO is Basic FFO adjusted to add back any changes in Basic FFO that would result from the assumed conversion of securities that are convertible or exchangeable into common shares.  The computation of Diluted FFO assumes the conversion of common units in the Operating Partnership but does not assume the conversion of other securities that are convertible into common shares if the conversion of those securities would increase Diluted FFO per share in a given period.  We believe that Diluted FFO is useful to investors because it is the numerator used to compute Diluted FFO per share, discussed below.  We believe that the numerator to diluted EPS is the most directly comparable GAAP measure to Diluted FFO.

 

Diluted FFO per share

 

Diluted FFO per share is (1) Diluted FFO divided by (2) the sum of the (a) weighted average common shares outstanding during a period, (b) weighted average common units outstanding during a period and (c) weighted average number of potential additional common shares that would have been outstanding during a period if other securities that are convertible or exchangeable into common shares were converted or exchanged.  The computation of Diluted FFO per share assumes the conversion of common units in the Operating Partnership but does not assume the conversion of other securities that are convertible into common shares if the conversion of those securities would increase Diluted FFO per share in a given period.  We believe that Diluted FFO per share is useful to investors because it provides investors with a further context for evaluating our FFO results in the same manner that investors use earnings per share (“EPS”) in evaluating net (loss) income available to common shareholders.  We believe that diluted EPS is the most directly comparable GAAP measure to Diluted FFO per share.

 

Diluted FFO available to common share and common unit holders, as adjusted for comparability (“Diluted FFO, as adjusted for comparability”)

 

Defined as Diluted FFO adjusted to exclude operating property acquisition costs and impairment losses.  We believe that the excluded items are not reflective of normal operations and, as a result, believe that a measure that excludes these items is a useful supplemental measure in evaluating operating performance.  We believe that the numerator to diluted EPS is the most directly comparable GAAP measure to this non-GAAP measure.

 

37



 

First Quarter 2011

 

Diluted FFO per share, as adjusted for comparability

 

Defined as (1) Diluted FFO available to common share and common unit holders, as adjusted for comparability divided by (2) the sum of the (a) weighted average common shares outstanding during a period, (b) weighted average common units outstanding during a period and (c) weighted average number of potential additional common shares that would have been outstanding during a period if other securities that are convertible or exchangeable into common shares were converted or exchanged.  The computation of this measure assumes the conversion of common units in the Operating Partnership but does not assume the conversion of other securities that are convertible into common shares if the conversion of those securities would increase the per share measure in a given period.  As discussed above, we believe that the excluded items are not indicative of normal operations.  As such, we believe that a measure that excludes these items is a useful supplemental measure in evaluating our operating performance.  We believe that diluted EPS is the most directly comparable GAAP measure.

 

Diluted adjusted funds from operations available to common share and common unit holders (“Diluted AFFO”)

 

Defined as Diluted FFO adjusted for the following: (1) the elimination of the effect of (a) noncash rental revenues and property operating expenses (comprised of straight-line rental adjustments, which includes the amortization of recurring tenant incentives, and amortization of acquisition intangibles included in FFO and NOI, both of which are described under “Cash NOI” below), (b) amortization of discounts on our Exchangeable Senior Notes, net of amounts capitalized, (c) impairment losses, (d) operating property acquisition costs and (e) accounting charges for original issuance costs associated with redeemed preferred shares; and (2) recurring capital expenditures.  Recurring capital expenditures are defined as tenant improvements and incentives, capital improvements and leasing costs for operating properties that are not (1) items contemplated prior to the acquisition of a property, (2) improvements associated with the expansion of a building or its improvements, (3) renovations to a building which change the underlying classification of the building (for example, from industrial to office or Class C office to Class B office) or (4) capital improvements that represent the addition of something new to the property rather than the replacement of something (for example, the addition of a new heating and air conditioning unit that is not replacing one that was previously there).  We believe that Diluted AFFO is an important supplemental measure of liquidity for an equity REIT because it provides management and investors with an indication of our ability to incur and service debt and to fund dividends and other cash needs.  We believe that the numerator to diluted EPS is the most directly comparable GAAP measure to Diluted AFFO.

 

Diluted AFFO, as adjusted for recurring capital expenditures of properties included in disposition plan

 

Defined as Diluted AFFO adjusted to add back recurring capital expenditures of properties included in a disposition plan disclosed in our Current Report on Form 8-K dated April 28, 2011.  We believe that this measure is a useful supplemental measure of liquidity because it provides management and investors with an additional indication of our ability to incur and service debt and to fund dividends and other cash needs without the effect of the recurring capital expenditures that we expect to recover through the proceeds from the property dispositions.  We believe that the numerator to diluted EPS is the most directly comparable GAAP measure to this measure.

 

Net operating income (“NOI”)

 

NOI is real estate revenues from continuing and discontinued operations reduced by total property expenses associated with real estate operations, including discontinued operations; total property expenses, as used in this definition, do not include depreciation, amortization or interest expense associated with real estate operations.  We believe that NOI is an important supplemental measure of operating performance for a REIT’s operating real estate because it provides a measure of the core real estate operations that is unaffected by depreciation, amortization, financing and general and administrative expenses; we believe this measure is particularly useful in evaluating the performance of geographic segments, same-office property groupings and individual properties.  We believe that net (loss) income is the most directly comparable GAAP measure to NOI.

 

Cash net operating income (“Cash NOI”)

 

Defined as NOI adjusted to eliminate the effects of noncash rental revenues and property operating expenses (comprised of straight-line rental adjustments, which includes the amortization of tenant incentives, and amortization of acquisition intangibles included in FFO and NOI).  Under GAAP, rental revenue is recognized evenly over the term of tenant leases.  Many leases provide for contractual rent increases and the effect of accounting under GAAP for such leases is to accelerate the recognition of lease revenue.  Since some leases provide for periods under the lease in which rental concessions are provided to tenants, the effect of accounting under GAAP is to allocate rental revenue to such periods.  Also under GAAP, when a property is acquired, we allocate the acquisition to certain intangible components (including above- and below-market leases and above or below market cost arrangements), which are then amortized into FFO and NOI over their estimated lives.  We believe that Cash NOI is an important supplemental measure of operating performance for a REIT’s operating real estate because it makes adjustments to NOI for the above stated items that are not associated with cash to us.  As is the case with NOI, the measure is useful in our opinion in evaluating and comparing the performance of geographic segments, same-office property groupings and individual properties.  We believe that net (loss) income is the most directly comparable GAAP measure to Cash NOI.

 

38



 

First Quarter 2011

 

Cash NOI, excluding gross lease termination fees

 

Defined as Cash NOI adjusted to eliminate the effects of lease termination fees paid by tenants to terminate their lease obligations prior to the end of the agreed lease terms.  Lease termination fees are often recognized as revenue in large one-time lump sum amounts upon the termination of tenant leases.  We believe that Cash NOI adjusted for lease termination fees is a useful supplemental measure of operating performance in evaluating same-office property groupings because it provides a means of evaluating the effect that lease terminations had on the performance of the property groupings.  We believe that net (loss) income is the most directly comparable GAAP measure to Cash NOI, excluding gross lease termination fees.

 

Adjusted Earnings Before Interest, Income Taxes, Depreciation and Amortization (“Adjusted EBITDA”)

 

Adjusted EBITDA is net (loss) income adjusted for the effects of interest expense, depreciation and amortization, impairment losses and income taxes.  We believe that adjusted EBITDA is a useful supplemental measure of performance for assessing our un-levered performance.  We believe that net (loss) income is the most directly comparable GAAP measure to adjusted EBITDA.

 

NOI Interest Coverage Ratio and Adjusted EBITDA Interest Coverage Ratio

 

These measures divide either NOI or Adjusted EBITDA by interest expense on continuing and discontinued operations (excluding amortization of deferred financing costs and amortization of discounts on our Exchangeable Senior Notes, net of amounts capitalized).

 

NOI Debt Service Coverage Ratio and Adjusted EBITDA Debt Service Coverage Ratio

 

These measures divide either NOI or Adjusted EBITDA by the sum of interest expense on continuing and discontinued operations (excluding amortization of deferred financing costs and amortization of discounts on our Exchangeable Senior Notes, net of amounts capitalized) and scheduled principal amortization on mortgage loans for continuing and discontinued operations.

 

NOI Fixed Charge Coverage Ratio and Adjusted EBITDA Fixed Charge Coverage Ratio

 

These measures divide either NOI or Adjusted EBITDA by the sum of (1) interest expense on continuing and discontinued operations (excluding amortization of deferred financing costs and amortization of discounts on our Exchangeable Senior Notes, net of amounts capitalized), (2) dividends on preferred shares and (3) distributions on preferred units in the Operating Partnership not owned by us.

 

Payout ratios based on: (1) Diluted FFO, as adjusted for comparability; (2) Diluted AFFO; and (3) Diluted AFFO, as adjusted for recurring capital expenditures of properties included in disposition plan

 

These payout ratios are defined as (1) the sum of (a) dividends on common shares and (b) distributions to holders of interests in the Operating Partnership and dividends on convertible preferred shares when such distributions and dividends are included in Diluted FFO divided by (2) the respective non-GAAP measures on which the payout ratios are based.

 

Dividend Coverage-Diluted FFO, as adjusted for comparability, and Dividend Coverage-Diluted AFFO

 

These measures divide either Diluted FFO, as adjusted for comparability, or Diluted AFFO by the sum of (1) dividends on common shares and (2) distributions to holders of interests in the Operating Partnership and dividends on convertible preferred shares when such distributions and dividends are included in Diluted FFO.

 

Debt to Adjusted EBITDA ratio

 

Defined as debt divided by Adjusted EBITDA for the three month period that is annualized by multiplying by four.

 

Adjusted Debt to Adjusted EBITDA ratio

 

Defined as (1) debt adjusted to subtract construction in progress as of the end of the period divided by (2) Adjusted EBITDA for the three month period that is annualized by multiplying by four.

 

Debt to Undepreciated Book Value of Real Estate Assets

 

Defined as the carrying value of our debt divided by total properties, net presented on our consolidated balance sheet excluding the effect of accumulated depreciation incurred to date on such properties.

 

Other Definitions

 

Acquisition costs — Transaction costs expensed in connection with executed or anticipated acquisitions of operating properties.

 

Annualized Rental Revenue — The monthly contractual base rent as of March 31, 2011, multiplied by 12, plus the estimated annualized expense reimbursements under existing office leases.

 

Greater Washington/Baltimore Region — Includes counties that comprise the Baltimore/Washington Corridor, Northern Virginia, Greater Baltimore, Suburban Maryland, St. Mary’s & King George Counties, and the Washington, DC-Capitol Riverfront.

 

39



 

First Quarter 2011

 

Same Office Properties — Operating office properties owned and 100% operational since January 1, 2010.

 

Strategic Tenant Properties — Properties occupied primarily by tenants in the United States Government and defense information technology sectors and data centers serving such sectors.

 

Under Construction — Properties on which vertical construction activities are underway.

 

Under Development — Properties on which work associated with one or more of the following tasks is underway on a regular basis: pursuing entitlements, planning, design and engineering, bidding, permitting and premarketing/preleasing. Typically, these projects, as categorized in this Supplemental Information package, are targeted to begin construction in 12 months or less.

 

Under Redevelopment — Properties previously in operations on which activities to substantially renovate such properties are underway.

 

40