Exhibit 99.1

 

Earnings Release & Supplemental Information — Unaudited June 30, 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

 

Summary of Wholly Owned Operating Office Properties by Region

8

 

Property Occupancy Rates by Region by Quarter for Wholly Owned Office Properties

9

 

Summary of Operating, Construction and Redevelopment Office Properties Ownership

9

 

Office Properties by Region — Wholly Owned Office Properties

10-15

 

Renewal Analysis for Wholly Owned Office Properties

16

 

Lease Expiration Analysis for Wholly Owned Office Properties

17

 

Top 20 Tenants — 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 IV

 

Disposition Summary for Wholly Owned Operating Office Properties

22

 

Construction, Development and Land Controlled Summary

23

 

Land Controlled

24

 

Summary of Construction Projects

25

 

Summary of Development and Redevelopment Projects

26

 

Office Property Construction Placed into Service in 2011

27

 

Construction Leasing Trend Analysis Over Previous Five Quarters

28

WHOLESALE DATA CENTER:

Section V

 

Wholesale Data Center Summary

29

CAPITALIZATION:

Section VI

 

Quarterly Common Equity Analysis

30

 

Quarterly Preferred Equity and Total Market Capitalization Analysis

31

 

Dividend Analysis

32

 

Debt Analysis

33

 

Debt Maturity Schedule

34

JOINT VENTURES:

Section VII

 

Summary of Consolidated Joint Ventures

35

 

Summary of Unconsolidated Joint Ventures

36

RECONCILIATIONS & DEFINITIONS:

Section VIII

 

Supplementary Reconciliations of Non-GAAP Measures

37-38

 

Definitions

39-42

 

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.

 



 

GRAPHIC

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 SECOND QUARTER 2011 RESULTS

 

COLUMBIA, MD July 28, 2011 — Corporate Office Properties Trust (COPT) (NYSE: OFC) today announced financial and operating results for the quarter ended June 30, 2011. Diluted loss per share was $0.42 for the quarter ended June 30, 2011 as compared to earnings per share of $0.07 for the quarter ended June 30, 2010. Excluding a non-cash impairment charge associated primarily with the Company’s Strategic Reallocation Plan and operating property acquisition costs, funds from operations (FFO) per diluted share for the second quarter of 2011 was $0.57, a 6% increase from the $0.54 FFO per share reported in the second quarter of 2010. This increase was primarily attributable to the operations of properties acquired or placed into service in 2010, and to gains on other investments. Including the impairment charge, FFO per diluted share for the quarter ended June 30, 2011 was $0.02.

 

“Despite the challenging leasing environment presented by the tepid economic recovery, we modestly outperformed our expectations for the second quarter. We leased over a million square feet and same office cash net operating income (NOI), excluding gross lease termination fees, increased 10% sequentially over the first quarter of 2011,” stated Randall M. Griffin, Chief Executive Officer of Corporate Office Properties Trust.

 

Operating Performance:

 

Portfolio Summary — At June 30, 2011, the Company’s wholly-owned portfolio of 249 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 $25.91 per square foot. The Company’s wholly-owned portfolio was 87.3% occupied and 89.4% leased as of June 30, 2011.

 

Same Office Performance — The Company’s same office portfolio for the quarter ended June 30, 2011 represents 81% of the rentable square feet of its consolidated portfolio and consists of 190 properties. For the quarter ended June 30, 2011, the Company’s same office property cash NOI, excluding lease termination fees, increased 10% as compared to the first quarter of 2011 and decreased 0.6% as compared to the quarter ended June 30, 2010.

 

Leasing — For the quarter ended June 30, 2011, 768,000 square feet were renewed equating to an 89% renewal rate, at an average committed cost of $11.49 per square foot. Total rent on renewed space increased 1.7%, as measured from the straight-line rent in effect preceding the renewal date, and decreased 7.7% on a cash basis. For renewed and retenanted space of 911,000 square feet, total

 



 

straight-line rent increased 2.1% and total rent on a cash basis decreased 7.3%. The average committed cost for renewed and retenanted space was $13.21 per square foot.

 

Investment Activity:

 

Construction — At June 30, 2011, the Company had properties totaling 1.2 million square feet under construction for a total projected cost of $271.9 million.

 

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

 

Dispositions — The Company sold three buildings located in Commons Corporate Center in Hanover, Maryland, totaling 39,000 square feet for $3.8 million.

 

Capital Raises:

 

On May 25, the Company completed a public offering of 4,600,000 newly issued common shares. The offering generated net proceeds, before offering expenses, of approximately $145.7 million.

 

Balance Sheet and Financial Flexibility:

 

As of June 30, 2011, the Company had a total market capitalization of $4.9 billion, with $2.3 billion in debt outstanding, equating to a 47% debt-to-total market capitalization ratio. Also, the Company’s weighted average interest rate was 4.9% for the quarter ended June 30, 2011 and 81% of the Company’s debt was subject to fixed interest rates, including the effect of interest rate swaps.

 

For the second quarter 2011, the Company’s adjusted EBITDA to interest expense coverage ratio was 3.10x, and the adjusted EBITDA fixed charge coverage ratio was 2.63x. Adjusting for construction in progress, the Company’s adjusted debt-to-adjusted EBITDA ratio was 6.39x for the three months ended June 30, 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.

 

2011 Guidance and Conference Call Information:

 

Management will discuss second quarter earnings results and any adjustments to earnings and FFO guidance for 2011, if applicable, on its conference call today at 11:00 a.m. Eastern Time, details of which are listed below:

 

Conference Call Date:

Thursday, July 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:

36436732

 

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=PAL8ATKPJ

 

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, July 28 at 2:00 p.m. Eastern Time through Thursday, August 4 at midnight Eastern Time. To access the replay within in the United States, please call 888-286-8010 and use passcode 33182288. To access the replay outside the United States, please call 617-801-6888 and use passcode 33182288.

 

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 June 30, 2011, the Company owned 269 office properties totaling 21.4 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, including risks associated with the impact of a government shutdown such as a reduction in rental revenues or non-renewal of leases;

·      the dilutive effect of issuing additional common shares; 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
 June 30,

 

Six Months Ended
 June 30,

 

 

 

2011

 

2010

 

2011

 

2010

 

Revenues

 

 

 

 

 

 

 

 

 

Real estate revenues

 

$

118,543

 

$

106,729

 

$

238,701

 

$

216,360

 

Construction contract and other service revenues

 

28,097

 

26,065

 

49,125

 

63,430

 

Total revenues

 

146,640

 

132,794

 

287,826

 

279,790

 

Expenses

 

 

 

 

 

 

 

 

 

Property operating expenses

 

44,721

 

39,260

 

94,431

 

86,206

 

Depreciation and amortization associated with real estate operations

 

31,440

 

28,720

 

62,830

 

55,531

 

Construction contract and other service expenses

 

26,909

 

25,402

 

47,527

 

61,801

 

Impairment losses

 

38,290

 

 

66,032

 

 

General and administrative expenses

 

6,320

 

5,926

 

13,097

 

11,826

 

Business development expenses

 

588

 

465

 

1,076

 

620

 

Total operating expenses

 

148,268

 

99,773

 

284,993

 

215,984

 

Operating (loss) income

 

(1,628

)

33,021

 

2,833

 

63,806

 

Interest expense

 

(26,607

)

(25,576

)

(53,246

)

(48,068

)

Interest and other income

 

2,756

 

245

 

3,924

 

1,547

 

Loss on early extinguishment of debt

 

(25

)

 

(25

)

 

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

 

(25,504

)

7,690

 

(46,514

)

17,285

 

Equity in loss of unconsolidated entities

 

(94

)

(72

)

(64

)

(277

)

Income tax benefit (expense)

 

5,042

 

(7

)

5,586

 

(48

)

(Loss) income from continuing operations

 

(20,556

)

7,611

 

(40,992

)

16,960

 

Discontinued operations

 

(5,467

)

1,205

 

(6,298

)

2,514

 

(Loss) income before gain on sales of real estate

 

(26,023

)

8,816

 

(47,290

)

19,474

 

Gain on sales of real estate, net of income taxes

 

16

 

335

 

2,717

 

352

 

Net (loss) income

 

(26,007

)

9,151

 

(44,573

)

19,826

 

Net loss (income) attributable to noncontrolling interests:

 

 

 

 

 

 

 

 

 

Common units in the Operating Partnership

 

1,887

 

(364

)

3,366

 

(891

)

Preferred units in the Operating Partnership

 

(165

)

(165

)

(330

)

(330

)

Other consolidated entities

 

61

 

(156

)

(477

)

(201

)

Net (loss) income attributable to COPT

 

(24,224

)

8,466

 

(42,014

)

18,404

 

Preferred share dividends

 

(4,026

)

(4,026

)

(8,051

)

(8,051

)

Net (loss) income attributable to COPT common shareholders

 

$

(28,250

)

$

4,440

 

$

(50,065

)

$

10,353

 

 

 

 

 

 

 

 

 

 

 

Earnings per share (“EPS”) computation:

 

 

 

 

 

 

 

 

 

Numerator for diluted EPS:

 

 

 

 

 

 

 

 

 

Net (loss) income attributable to common shareholders

 

$

(28,250

)

$

4,440

 

$

(50,065

)

$

10,353

 

Dilutive effect of common units in the Operating Partnership

 

(1,887

)

 

(3,366

)

 

Amount allocable to restricted shares

 

(237

)

(250

)

(519

)

(540

)

Numerator for diluted EPS

 

$

(30,374

)

$

4,190

 

$

(53,950

)

$

9,813

 

 

 

 

 

 

 

 

 

 

 

Denominator:

 

 

 

 

 

 

 

 

 

Weighted average common shares - basic

 

68,446

 

58,489

 

67,399

 

58,169

 

Dilutive effect of common units

 

4,382

 

 

4,389

 

 

Dilutive effect of share-based compensation awards

 

 

421

 

 

405

 

Weighted average common shares - diluted

 

72,828

 

58,910

 

71,788

 

58,574

 

 

 

 

 

 

 

 

 

 

 

Diluted EPS

 

$

(0.42

)

$

0.07

 

$

(0.75

)

$

0.17

 

 



 

Corporate Office Properties Trust

Summary Financial Data

(unaudited)

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

 

 

 

Three Months Ended
 June 30,

 

Six Months Ended
 June 30,

 

 

 

2011

 

2010

 

2011

 

2010

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income

 

$

(26,007

)

$

9,151

 

$

(44,573

)

$

19,826

 

Add: Real estate-related depreciation and amortization

 

32,049

 

29,548

 

65,069

 

57,151

 

Add: Depreciation and amortization on unconsolidated real estate entities

 

115

 

171

 

234

 

346

 

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

 

(150

)

 

(150

)

(297

)

Funds from operations (“FFO”)

 

6,007

 

38,870

 

20,580

 

77,026

 

Noncontrolling interests - preferred units in the Operating Partnership

 

(165

)

(165

)

(330

)

(330

)

Noncontrolling interests - other consolidated entities

 

61

 

(156

)

(477

)

(201

)

Preferred share dividends

 

(4,026

)

(4,026

)

(8,051

)

(8,051

)

Depreciation and amortization allocable to noncontrolling interests in other consolidated entities

 

(225

)

(297

)

(290

)

(579

)

Basic and diluted FFO allocable to restricted shares

 

(237

)

(346

)

(519

)

(725

)

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

 

1,415

 

33,880

 

10,913

 

67,140

 

Straight line rent adjustments

 

(2,611

)

(1,473

)

(6,523

)

(3,819

)

Amortization of acquisition intangibles included in net operating income

 

227

 

(94

)

388

 

(364

)

Recurring capital expenditures

 

(14,913

)

(7,080

)

(29,257

)

(13,291

)

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

 

1,582

 

1,488

 

3,140

 

2,270

 

Impairment losses

 

44,605

 

 

72,347

 

 

Income tax benefit from impairment losses

 

(4,598

)

 

(4,598

)

 

Operating property acquisition costs

 

52

 

271

 

75

 

290

 

Loss on early extinguishment of debt

 

25

 

 

25

 

 

Diluted adjusted funds from operations available to common share and common unit

 

 

 

 

 

 

 

 

 

holders (“Diluted AFFO”)

 

$

25,784

 

$

26,992

 

$

46,510

 

$

52,226

 

Recurring capital expenditures on properties included in Strategic Reallocation Plan

 

2,475

 

 

 

8,130

 

 

 

Diluted AFFO, as adjusted for recurring capital expenditures on properties included in Strategic Reallocation Plan

 

$

28,259

 

 

 

$

54,640

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares

 

 

 

 

 

 

 

 

 

Weighted average common shares

 

68,446

 

58,489

 

67,399

 

58,169

 

Conversion of weighted average common units

 

4,382

 

4,558

 

4,389

 

4,786

 

Weighted average common shares/units - basic FFO per share

 

72,828

 

63,047

 

71,788

 

62,955

 

Dilutive effect of share-based compensation awards

 

151

 

421

 

205

 

405

 

Weighted average common shares/units - diluted FFO per share

 

72,979

 

63,468

 

71,993

 

63,360

 

 

 

 

 

 

 

 

 

 

 

Diluted FFO per share

 

$

0.02

 

$

0.53

 

$

0.15

 

$

1.06

 

Diluted FFO per share, as adjusted for comparability

 

$

0.57

 

$

0.54

 

$

1.09

 

$

1.06

 

Dividends/distributions per common share/unit

 

$

0.4125

 

$

0.3925

 

$

0.8250

 

$

0.7850

 

Payout ratios

 

 

 

 

 

 

 

 

 

Diluted FFO, as adjusted for comparability

 

75.8

%

73.2

%

77.4

%

74.2

%

Diluted AFFO

 

121.9

%

92.6

%

131.1

%

95.8

%

Diluted AFFO, as adjusted for recurring capital expenditures on properties included in Strategic Reallocation Plan

 

111.3

%

N/A

 

111.6

%

N/A

 

Adjusted EBITDA interest coverage ratio

 

3.10x

 

2.85x

 

3.02x

 

2.90x

 

Adjusted EBITDA fixed charge coverage ratio

 

2.63x

 

2.41x

 

2.56x

 

2.44x

 

Debt to Adjusted EBITDA ratio (1)

 

7.87x

 

8.36x

 

N/A

 

N/A

 

Adjusted debt to Adjusted EBITDA ratio (2)

 

6.39x

 

7.14x

 

N/A

 

N/A

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of denominators for diluted EPS and diluted FFO per share

 

 

 

 

 

 

 

 

 

Denominator for diluted EPS

 

72,828

 

58,910

 

71,788

 

58,574

 

Weighted average common units

 

 

4,558

 

 

4,786

 

Anti-dilutive EPS effect of share-based compensation awards

 

151

 

 

205

 

 

Denominator for diluted FFO per share

 

72,979

 

63,468

 

71,993

 

63,360

 

 


(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)

 

 

 

June 30,

 

December 31,

 

 

 

 

 

 

 

2011

 

2010

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

Properties, net of accumulated depreciation

 

$

3,472,861

 

$

3,445,455

 

 

 

 

 

Total assets

 

3,868,230

 

3,844,517

 

 

 

 

 

Debt, net

 

2,299,416

 

2,323,681

 

 

 

 

 

Total liabilities

 

2,514,858

 

2,521,379

 

 

 

 

 

Beneficiaries’ equity

 

1,353,372

 

1,323,138

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt to total assets

 

59.4

%

60.4

%

 

 

 

 

Debt to undepreciated book value of real estate assets

 

56.0

%

57.2

%

 

 

 

 

Debt to total market capitalization

 

47.0

%

46.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

Number of operating properties owned

 

249

 

252

 

 

 

 

 

Total net rentable square feet owned (in thousands)

 

20,244

 

19,990

 

 

 

 

 

Occupancy

 

87.3

%

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

 

$

3,868,230

 

$

3,844,517

 

 

 

 

 

Assets other than assets included in properties, net

 

(395,369

)

(399,062

)

 

 

 

 

Accumulated depreciation on real estate assets

 

534,407

 

503,032

 

 

 

 

 

Intangible assets on real estate acquisitions, net

 

99,917

 

113,735

 

 

 

 

 

Denominator for debt to undepreciated book value of real estate assets

 

$

4,107,185

 

$

4,062,222

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

June 30,

 

June 30,

 

 

 

2011

 

2010

 

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

 

$

11,116

 

$

4,630

 

$

24,386

 

$

8,701

 

Total capital improvements on operating properties

 

2,426

 

1,524

 

4,416

 

2,394

 

Total leasing costs on operating properties

 

3,388

 

1,350

 

6,124

 

2,688

 

Less: Nonrecurring tenant improvements and incentives on operating properties

 

(875

)

(136

)

(3,323

)

(213

)

Less: Nonrecurring capital improvements on operating properties

 

(820

)

(293

)

(1,430

)

(353

)

Less: Nonrecurring leasing costs for operating properties

 

(347

)

(3

)

(963

)

51

 

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

 

25

 

8

 

47

 

23

 

Recurring capital expenditures

 

$

14,913

 

$

7,080

 

$

29,257

 

$

13,291

 

 



 

Corporate Office Properties Trust

Summary Financial Data

(unaudited)

(Dollars in thousands)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

June 30,

 

June 30,

 

 

 

2011

 

2010

 

2011

 

2010

 

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

 

 

 

 

 

 

 

 

 

Common share dividends

 

$

29,632

 

$

23,259

 

$

57,336

 

$

46,419

 

Common unit distributions

 

1,808

 

1,749

 

3,617

 

3,616

 

Dividends and distributions for payout ratios

 

$

31,440

 

$

25,008

 

$

60,953

 

$

50,035

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of FFO to FFO, as adjusted for comparability

 

 

 

 

 

 

 

 

 

FFO

 

$

6,007

 

$

38,870

 

$

20,580

 

$

77,026

 

Impairment losses, net of related tax benefit

 

40,007

 

 

67,749

 

 

Operating property acquisition costs

 

52

 

271

 

75

 

290

 

Loss on early extinguishment of debt

 

25

 

 

25

 

 

FFO, as adjusted for comparability

 

$

46,091

 

$

39,141

 

$

88,429

 

$

77,316

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

Diluted FFO

 

$

1,415

 

$

33,880

 

$

10,913

 

$

67,140

 

Impairment losses, net of related tax benefit

 

40,007

 

 

67,749

 

 

Operating property acquisition costs

 

52

 

271

 

75

 

290

 

Loss on early extinguishment of debt

 

25

 

 

25

 

 

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

 

$

41,499

 

$

34,151

 

$

78,762

 

$

67,430

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

Net (loss) income

 

$

(26,007

)

$

9,151

 

$

(44,573

)

$

19,826

 

Interest expense on continuing operations

 

26,607

 

25,576

 

53,246

 

48,068

 

Interest expense on discontinued operations

 

223

 

345

 

512

 

556

 

Income tax (benefit) expense

 

(5,042

)

7

 

(5,586

)

59

 

Real estate-related depreciation and amortization

 

32,049

 

29,548

 

65,069

 

57,151

 

Depreciation of furniture, fixtures and equipment

 

623

 

632

 

1,248

 

1,282

 

Impairment losses

 

44,605

 

 

72,347

 

 

Adjusted EBITDA

 

$

73,058

 

$

65,259

 

$

142,263

 

$

126,942

 

 

 

 

 

 

 

 

 

 

 

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

 

$

26,607

 

$

25,576

 

$

53,246

 

$

48,068

 

Interest expense from discontinued operations

 

223

 

345

 

512

 

556

 

Less: Amortization of deferred financing costs

 

(1,702

)

(1,495

)

(3,461

)

(2,621

)

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

 

(1,582

)

(1,488

)

(3,140

)

(2,270

)

Denominator for interest coverage-Adjusted EBITDA

 

23,546

 

22,938

 

47,157

 

43,733

 

Preferred share dividends

 

4,026

 

4,026

 

8,051

 

8,051

 

Preferred unit distributions

 

165

 

165

 

330

 

330

 

Denominator for fixed charge coverage-Adjusted EBITDA

 

$

27,737

 

$

27,129

 

$

55,538

 

$

52,114

 

 

 

 

 

 

 

 

 

 

 

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

 

$

62,961

 

$

64,263

 

$

122,021

 

$

125,023

 

Less: Straight-line rent adjustments

 

(1,581

)

(1,511

)

(4,662

)

(3,842

)

Less: Amortization of deferred market rental revenue

 

(193

)

(281

)

(432

)

(736

)

Same office property cash net operating income

 

$

61,187

 

$

62,471

 

$

116,927

 

$

120,445

 

Less: Lease termination fees, gross

 

(46

)

(976

)

(183

)

(1,066

)

Same office property cash net operating income, excluding

 

 

 

 

 

 

 

 

 

gross lease termination fees

 

$

61,141

 

$

61,495

 

$

116,744

 

$

119,379

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

Debt, net

 

$

2,299,416

 

$

2,182,375

 

 

 

 

 

Less: Construction in progress, including held for sale properties

 

(430,608

)

(319,846

)

 

 

 

 

Denominator for adjusted debt to Adjusted EBITDA ratio

 

$

1,868,808

 

$

1,862,529

 

 

 

 

 

 



 

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 June 30, 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 June 30, 2011, COPT’s wholly-owned portfolio of 249 office properties encompassed 20.2 million square feet and was 89.4% leased. As of 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 installations (rather than weapons production-oriented bases) that are executing programs deemed critical to the nation’s current and future security. 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

Michelle Layne, IR Specialist

& Construction

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



 

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



 

Selected Financial Summary Data

(in thousands, except per share data)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

6/30/11

 

6/30/2010

 

SUMMARY OF RESULTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI

 

$

 

75,352

 

$

 

71,536

 

$

 

76,694

 

$

 

70,724

 

$

 

69,847

 

$

 

146,888

 

$

 

134,547

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

 

73,058

 

$

 

69,205

 

$

 

79,652

 

$

 

66,976

 

$

 

65,259

 

$

 

142,263

 

$

 

126,942

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income attributable to COPT common shareholders

 

$

 

(28,250

)

$

 

(21,815

)

$

 

11,498

 

$

 

4,807

 

$

 

4,440

 

$

 

(50,065

)

$

 

10,353

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO - per NAREIT

 

$

 

6,007

 

$

 

14,573

 

$

 

52,222

 

$

 

39,053

 

$

 

38,870

 

$

 

20,580

 

$

 

77,026

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO - as adjusted for comparability

 

$

 

46,091

 

$

 

42,338

 

$

 

52,692

 

$

 

41,717

 

$

 

39,141

 

$

 

88,429

 

$

 

77,316

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

$

 

1,415

 

$

 

9,498

 

$

 

47,227

 

$

 

34,278

 

$

 

33,880

 

$

 

10,913

 

$

 

67,140

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted AFFO available to common share and common unit holders

 

$

 

25,784

 

$

 

20,726

 

$

 

30,962

 

$

 

29,498

 

$

 

26,992

 

$

 

46,510

 

$

 

52,226

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share - diluted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EPS

 

$

 

(0.42

)

$

 

(0.33

)

$

 

0.18

 

$

 

0.08

 

$

 

0.07

 

$

 

(0.75

)

$

 

0.17

 

FFO - NAREIT

 

$

 

0.02

 

$

 

0.13

 

$

 

0.69

 

$

 

0.54

 

$

 

0.53

 

$

 

0.15

 

$

 

1.06

 

FFO - as adjusted for comparability

 

$

 

0.57

 

$

 

0.52

 

$

 

0.70

 

$

 

0.58

 

$

 

0.54

 

$

 

1.09

 

$

 

1.06

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividend per common share

 

$

 

0.4125

 

$

 

0.4125

 

$

 

0.4125

 

$

 

0.4125

 

$

 

0.3925

 

$

 

0.8250

 

$

 

0.7850

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payout ratios:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted FFO - as adjusted for comparability

 

75.8

%

79.2

%

61.7

%

71.3

%

73.2

%

77.4

%

74.2

%

Diluted AFFO

 

121.9

%

142.4

%

95.0

%

89.3

%

92.6

%

131.1

%

95.8

%

Diluted AFFO, as adjusted for recurring capital expenditures of properties included in disposition plan or are held for sale

 

111.3

%

111.9

%

N/A

 

N/A

 

N/A

 

111.6

%

N/A

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CAPITALIZATION

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt, net

 

$

 

2,299,416

 

$

 

2,396,795

 

$

 

2,323,681

 

$

 

2,468,419

 

$

 

2,182,375

 

 

 

 

 

Debt to Total Market Capitalization

 

47.0

%

46.0

%

46.1

%

48.6

%

45.3

%

 

 

 

 

Debt to Undepreciated Book Value of Real Estate Assets

 

56.0

%

58.4

%

57.2

%

62.5

%

59.1

%

 

 

 

 

Adjusted EBITDA fixed charge coverage ratio

 

2.6

x

2.5

x

2.9

x

2.4

x

2.4

x

 

 

 

 

Adjusted Debt to Adjusted EBITDA ratio

 

6.4

x

7.2

x

6.1

x

7.9

x

7.1

x

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue from early termination of leases

 

$

 

196

 

$

 

146

 

$

 

2,014

 

$

 

182

 

$

 

955

 

$

 

342

 

$

 

1,189

 

Capitalized interest costs

 

$

 

4,308

 

$

 

4,341

 

$

 

4,520

 

$

 

3,861

 

$

 

4,208

 

$

 

8,649

 

$

 

8,144

 

 

3



 

Selected Financial Summary Data

(in thousands, except per share data)

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

PORTFOLIO

 

 

 

 

 

 

 

 

 

 

 

Properties, gross (excluding accumulated depreciation)

 

 

 

 

 

 

 

 

 

 

 

Wholly-owned

 

$

3,887,684

 

$

3,879,847

 

$

3,833,624

 

$

3,715,452

 

$

3,484,673

 

+ Consolidated JV (1)

 

119,584

 

115,749

 

114,863

 

112,916

 

110,249

 

Consolidated properties

 

$

4,007,268

 

$

3,995,596

 

$

3,948,487

 

$

3,828,368

 

$

3,594,922

 

 

 

 

 

 

 

 

 

 

 

 

 

# of Operating Office Properties

 

 

 

 

 

 

 

 

 

 

 

Wholly-owned

 

249

 

252

 

252

 

249

 

247

 

+ Consolidated JV

 

4

 

4

 

4

 

4

 

4

 

Consolidated properties

 

253

 

256

 

256

 

253

 

251

 

 

 

 

 

 

 

 

 

 

 

 

 

% Occupied

 

 

 

 

 

 

 

 

 

 

 

Wholly-owned

 

87.3

%

87.0

%

88.2

%

87.4

%

88.3

%

+ Consolidated JV

 

58.9

%

61.5

%

61.5

%

61.5

%

60.1

%

Consolidated properties

 

86.6

%

86.4

%

87.6

%

86.8

%

87.7

%

 

 

 

 

 

 

 

 

 

 

 

 

% Leased

 

 

 

 

 

 

 

 

 

 

 

Wholly-owned

 

89.4

%

89.2

%

89.5

%

88.7

%

89.3

%

+ Consolidated JV

 

60.1

%

62.8

%

62.7

%

62.7

%

62.6

%

Consolidated properties

 

88.7

%

88.6

%

88.9

%

88.1

%

88.7

%

 

 

 

 

 

 

 

 

 

 

 

 

Square Feet of office properties (in thousands)

 

 

 

 

 

 

 

 

 

 

 

Wholly-owned

 

20,244

 

20,183

 

19,990

 

19,929

 

19,487

 

+ Consolidated JV Square Footage

 

442

 

442

 

442

 

442

 

442

 

Consolidated Square Footage

 

20,686

 

20,625

 

20,432

 

20,371

 

19,929

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

84.1

%

84.4

%

84.2

%

84.2

%

82.8

%

 

 

 

 

 

 

 

 

 

 

 

 

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

 

59.1

%

58.8

%

58.7

%

56.5

%

54.8

%

 


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

 

4



 

Quarterly Consolidated Balance Sheets

(dollars in thousands)

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

Assets

 

 

 

 

 

 

 

 

 

 

 

Properties, net

 

 

 

 

 

 

 

 

 

 

 

Operating properties

 

$

3,269,049

 

$

3,345,921

 

$

3,305,805

 

$

3,241,507

 

$

3,040,414

 

Land - development

 

248,647

 

253,505

 

256,487

 

241,937

 

234,662

 

Properties under construction and development, excluding associated land costs

 

407,674

 

396,170

 

386,195

 

344,924

 

319,846

 

Properties held for sale

 

81,898

 

 

 

 

 

Less: accumulated depreciation

 

(534,407

)

(526,825

)

(503,032

)

(479,218

)

(464,408

)

Total properties, net

 

3,472,861

 

3,468,771

 

3,445,455

 

3,349,150

 

3,130,514

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

11,703

 

12,606

 

10,102

 

11,733

 

9,879

 

Restricted cash and marketable securities

 

22,909

 

24,094

 

22,582

 

21,095

 

20,738

 

Accounts receivable, net

 

13,083

 

19,765

 

18,938

 

18,906

 

12,552

 

Deferred rent receivable

 

85,190

 

82,901

 

79,160

 

76,833

 

75,683

 

Intangible assets on real estate acquisitions, net

 

99,917

 

106,444

 

113,735

 

123,307

 

96,151

 

Deferred leasing and financing costs, net

 

60,988

 

60,479

 

60,649

 

56,568

 

55,762

 

Prepaid expenses and other assets

 

101,579

 

90,749

 

93,896

 

79,780

 

66,004

 

Total assets

 

$

3,868,230

 

$

3,865,809

 

$

3,844,517

 

$

3,737,372

 

$

3,467,283

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and equity

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

Debt, net

 

$

2,299,416

 

$

2,396,795

 

$

2,323,681

 

$

2,468,419

 

$

2,182,375

 

Accounts payable and accrued expenses

 

115,154

 

103,043

 

99,699

 

88,461

 

84,164

 

Rents received in advance and security deposits

 

26,779

 

29,427

 

31,603

 

26,919

 

28,328

 

Dividends and distributions payable

 

35,021

 

33,048

 

32,986

 

29,899

 

28,580

 

Deferred revenue associated with operating leases

 

12,883

 

13,897

 

14,802

 

15,790

 

12,929

 

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

 

5,841

 

5,686

 

5,545

 

5,458

 

5,351

 

Interest rate derivatives

 

10,020

 

3,564

 

4,226

 

4,943

 

4,284

 

Other liabilities

 

9,744

 

8,691

 

8,837

 

7,755

 

9,706

 

Total liabilities

 

2,514,858

 

2,594,151

 

2,521,379

 

2,647,644

 

2,355,717

 

 

 

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

 

 

 

 

COPT’s shareholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

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

 

81

 

81

 

81

 

81

 

81

 

Common shares

 

719

 

671

 

669

 

594

 

593

 

Additional paid-in capital

 

1,657,536

 

1,511,638

 

1,511,844

 

1,271,363

 

1,269,142

 

Cumulative distributions in excess of net income

 

(389,195

)

(331,313

)

(281,794

)

(265,695

)

(246,008

)

Accumulated other comprehensive loss

 

(9,624

)

(3,197

)

(4,163

)

(4,861

)

(4,263

)

Total COPT’s shareholders’ equity

 

1,259,517

 

1,177,880

 

1,226,637

 

1,001,482

 

1,019,545

 

Noncontrolling interests in subsidiaries

 

 

 

 

 

 

 

 

 

 

 

Common units in the Operating Partnership

 

66,482

 

66,016

 

69,337

 

61,867

 

63,675

 

Preferred units in the Operating Partnership

 

8,800

 

8,800

 

8,800

 

8,800

 

8,800

 

Other consolidated entities

 

18,573

 

18,962

 

18,364

 

17,579

 

19,546

 

Total noncontrolling interests in subsidiaries

 

93,855

 

93,778

 

96,501

 

88,246

 

92,021

 

Total equity

 

1,353,372

 

1,271,658

 

1,323,138

 

1,089,728

 

1,111,566

 

Total liabilities and equity

 

$

3,868,230

 

$

3,865,809

 

$

3,844,517

 

$

3,737,372

 

$

3,467,283

 

 

5



 

Consolidated Statements of Operations

(in thousands, except per share data)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

6/30/11

 

6/30/10

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental revenue

 

$

98,589

 

$

97,275

 

$

97,076

 

$

90,952

 

$

88,779

 

$

195,864

 

$

177,423

 

Tenant recoveries and other real estate operations revenue

 

19,954

 

22,883

 

23,071

 

21,024

 

17,950

 

42,837

 

38,937

 

Construction contract and other service revenues

 

28,097

 

21,028

 

27,637

 

13,608

 

26,065

 

49,125

 

63,430

 

Total revenues

 

146,640

 

141,186

 

147,784

 

125,584

 

132,794

 

287,826

 

279,790

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property operating expenses

 

44,721

 

49,710

 

46,240

 

43,415

 

39,260

 

94,431

 

86,206

 

Depreciation and amortization associated with real estate operations

 

31,440

 

31,390

 

34,010

 

29,933

 

28,720

 

62,830

 

55,531

 

Construction contract and other service expenses

 

26,909

 

20,618

 

27,154

 

13,347

 

25,402

 

47,527

 

61,801

 

Impairment losses

 

38,290

 

27,742

 

 

 

 

66,032

 

 

General and administrative expenses

 

6,320

 

6,777

 

6,103

 

6,079

 

5,926

 

13,097

 

11,826

 

Business development expenses

 

588

 

488

 

691

 

2,886

 

465

 

1,076

 

620

 

Total operating expenses

 

148,268

 

136,725

 

114,198

 

95,660

 

99,773

 

284,993

 

215,984

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating (loss) income

 

(1,628

)

4,461

 

33,586

 

29,924

 

33,021

 

2,833

 

63,806

 

Interest expense

 

(26,607

)

(26,639

)

(26,622

)

(26,275

)

(25,576

)

(53,246

)

(48,068

)

Interest and other income

 

2,756

 

1,168

 

7,626

 

395

 

245

 

3,924

 

1,547

 

Loss on early extinguishment of debt

 

(25

)

 

 

 

 

(25

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

(25,504

)

(21,010

)

14,590

 

4,044

 

7,690

 

(46,514

)

17,285

 

Equity in (loss) income of unconsolidated entities

 

(94

)

30

 

1,005

 

648

 

(72

)

(64

)

(277

)

Income tax benefit (expense)

 

5,042

 

544

 

(33

)

(27

)

(7

)

5,586

 

(48

)

(Loss) income from continuing operations

 

(20,556

)

(20,436

)

15,562

 

4,665

 

7,611

 

(40,992

)

16,960

 

Discontinued operations

 

(5,467

)

(831

)

1,190

 

1,784

 

1,205

 

(6,298

)

2,514

 

(Loss) income before gain on sales of real estate

 

(26,023

)

(21,267

)

16,752

 

6,449

 

8,816

 

(47,290

)

19,474

 

Gain on sales of real estate, net of income taxes

 

16

 

2,701

 

 

2,477

 

335

 

2,717

 

352

 

Net (loss) income

 

(26,007

)

(18,566

)

16,752

 

8,926

 

9,151

 

(44,573

)

19,826

 

Net loss (income) attributable to noncontrolling interests

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common units in the Operating Partnership

 

1,887

 

1,479

 

(862

)

(363

)

(364

)

3,366

 

(891

)

Preferred units in the Operating Partnership

 

(165

)

(165

)

(165

)

(165

)

(165

)

(330

)

(330

)

Other consolidated entities

 

61

 

(538

)

(201

)

434

 

(156

)

(477

)

(201

)

Net (loss) income attributable to COPT

 

(24,224

)

(17,790

)

15,524

 

8,832

 

8,466

 

(42,014

)

18,404

 

Preferred share dividends

 

(4,026

)

(4,025

)

(4,026

)

(4,025

)

(4,026

)

(8,051

)

(8,051

)

Net (loss) income attributable to COPT common shareholders

 

$

(28,250

)

$

(21,815

)

$

11,498

 

$

4,807

 

$

4,440

 

$

(50,065

)

$

10,353

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For diluted EPS computations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Numerator for diluted EPS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income attributable to common shareholders

 

$

(28,250

)

$

(21,815

)

$

11,498

 

$

4,807

 

$

4,440

 

$

(50,065

)

$

10,353

 

Dilutive effect of common units in the Operating Partnership

 

(1,887

)

(1,479

)

 

 

 

(3,366

)

 

Amount allocable to restricted shares

 

(237

)

(282

)

(264

)

(267

)

(250

)

(519

)

(540

)

Numerator for diluted EPS

 

$

(30,374

)

$

(23,576

)

$

11,234

 

$

4,540

 

$

4,190

 

$

(53,950

)

$

9,813

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Denominator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares - basic

 

68,446

 

66,340

 

63,404

 

58,656

 

58,489

 

67,399

 

58,169

 

Dilutive effect of common units in the Operating Partnership

 

4,382

 

4,396

 

 

 

 

4,389

 

 

Dilutive effect of share-based compensation awards

 

 

 

236

 

296

 

421

 

 

405

 

Weighted average common shares - diluted

 

72,828

 

70,736

 

63,640

 

58,952

 

58,910

 

71,788

 

58,574

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted EPS

 

$

(0.42

)

$

(0.33

)

$

0.18

 

$

0.08

 

$

0.07

 

$

(0.75

)

$

0.17

 

 

6



 

Consolidated Reconciliations of FFO and AFFO

(in thousands, except per share data)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

6/30/11

 

6/30/10

 

Net operating income

 

$

75,352

 

$

71,536

 

$

76,694

 

$

70,724

 

$

69,847

 

$

146,888

 

$

134,547

 

General and administrative expenses

 

(6,320

)

(6,777

)

(6,103

)

(6,079

)

(5,926

)

(13,097

)

(11,826

)

Business development expenses

 

(588

)

(488

)

(691

)

(2,886

)

(465

)

(1,076

)

(620

)

Income from construction contracts and other service operations

 

1,188

 

410

 

483

 

261

 

663

 

1,598

 

1,629

 

Impairment losses

 

(44,605

)

(27,742

)

 

 

 

(72,347

)

 

Equity in (loss) income of unconsolidated entities

 

(94

)

30

 

1,005

 

648

 

(72

)

(64

)

(277

)

Depreciation and amortization on unconsolidated real estate entities

 

115

 

119

 

119

 

166

 

171

 

234

 

346

 

Interest and other income

 

2,756

 

1,168

 

7,626

 

395

 

245

 

3,924

 

1,547

 

Loss on early extinguishment of debt

 

(25

)

 

 

 

 

(25

)

 

Gain on sales of real estate, net of income taxes

 

16

 

2,701

 

 

2,477

 

335

 

2,717

 

352

 

Total interest expense

 

(26,830

)

(26,928

)

(26,878

)

(26,626

)

(25,921

)

(53,758

)

(48,624

)

Income tax benefit (expense)

 

5,042

 

544

 

(33

)

(27

)

(7

)

5,586

 

(48

)

FFO - per NAREIT

 

6,007

 

14,573

 

52,222

 

39,053

 

38,870

 

20,580

 

77,026

 

Preferred share dividends

 

(4,026

)

(4,025

)

(4,026

)

(4,025

)

(4,026

)

(8,051

)

(8,051

)

Noncontrolling interests - preferred units in the Operating Partnership

 

(165

)

(165

)

(165

)

(165

)

(165

)

(330

)

(330

)

Noncontrolling interests - other consolidated entities (1)

 

61

 

(538

)

(201

)

434

 

(156

)

(477

)

(201

)

Depreciation and amortization allocable to noncontrolling interests in other consolidated entities (1)

 

(225

)

(65

)

(157

)

(666

)

(297

)

(290

)

(579

)

Basic and diluted FFO allocable to restricted shares

 

(237

)

(282

)

(446

)

(353

)

(346

)

(519

)

(725

)

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

 

$

1,415

 

$

9,498

 

$

47,227

 

$

34,278

 

$

33,880

 

$

10,913

 

$

67,140

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO - per NAREIT

 

$

6,007

 

$

14,573

 

$

52,222

 

$

39,053

 

$

38,870

 

$

20,580

 

$

77,026

 

Depreciation and amortization

 

(32,049

)

(33,020

)

(35,347

)

(30,745

)

(29,548

)

(65,069

)

(57,151

)

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

 

150

 

 

(4

)

784

 

 

150

 

297

 

Depreciation and amortization on unconsolidated real estate entities

 

(115

)

(119

)

(119

)

(166

)

(171

)

(234

)

(346

)

Net (loss) income

 

(26,007

)

(18,566

)

16,752

 

8,926

 

9,151

 

(44,573

)

19,826

 

Noncontrolling interests - common units in the Operating Partnership

 

1,887

 

1,479

 

(862

)

(363

)

(364

)

3,366

 

(891

)

Noncontrolling interests - preferred units in the Operating Partnership

 

(165

)

(165

)

(165

)

(165

)

(165

)

(330

)

(330

)

Noncontrolling interests - other consolidated entities

 

61

 

(538

)

(201

)

434

 

(156

)

(477

)

(201

)

Net (loss) income attributable to COPT

 

$

(24,224

)

$

(17,790

)

$

15,524

 

$

8,832

 

$

8,466

 

$

(42,014

)

$

18,404

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

$

1,415

 

$

9,498

 

$

47,227

 

$

34,278

 

$

33,880

 

$

10,913

 

$

67,140

 

Straight line rent adjustments

 

(2,611

)

(3,912

)

(2,047

)

1,267

 

(1,473

)

(6,523

)

(3,819

)

Amortization of acquisition intangibles included in NOI

 

227

 

161

 

(231

)

(96

)

(94

)

388

 

(364

)

Recurring capital expenditures

 

(14,913

)

(14,344

)

(15,960

)

(10,156

)

(7,080

)

(29,257

)

(13,291

)

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

 

1,582

 

1,558

 

1,503

 

1,541

 

1,488

 

3,140

 

2,270

 

Impairment losses, net of related tax benefit

 

40,007

 

27,742

 

 

 

 

67,749

 

 

Operating property acquisition costs

 

52

 

23

 

470

 

2,664

 

271

 

75

 

290

 

Loss on early extinguishment of debt

 

25

 

 

 

 

 

25

 

 

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

 

$

25,784

 

$

20,726

 

$

30,962

 

$

29,498

 

$

26,992

 

$

46,510

 

$

52,226

 

Recurring capital expenditures on properties included in Strategic Reallocation Plan

 

2,475

 

5,655

 

 

 

 

 

 

 

8,130

 

 

 

Diluted AFFO, as adjusted for recurring capital expenditures of properties included in Strategic Reallocation Plan

 

$

28,259

 

$

26,381

 

 

 

 

 

 

 

$

54,640

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO - per NAREIT

 

$

6,007

 

$

14,573

 

$

52,222

 

$

39,053

 

$

38,870

 

$

20,580

 

$

77,026

 

Operating property acquisition costs

 

52

 

23

 

470

 

2,664

 

271

 

75

 

290

 

Impairment losses, net of related tax benefit

 

40,007

 

27,742

 

 

 

 

67,749

 

 

Loss on early extinguishment of debt

 

25

 

 

 

 

 

25

 

 

FFO- as adjusted for comparability

 

$

46,091

 

$

42,338

 

$

52,692

 

$

41,717

 

$

39,141

 

$

88,429

 

$

77,316

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted FFO available to common share and common unit holders

 

$

1,415

 

$

9,498

 

$

47,227

 

$

34,278

 

$

33,880

 

$

10,913

 

$

67,140

 

Operating property acquisition costs

 

52

 

23

 

470

 

2,664

 

271

 

75

 

290

 

Impairment losses, net of related tax benefit

 

40,007

 

27,742

 

 

 

 

67,749

 

 

Loss on early extinguishment of debt

 

25

 

 

 

 

 

25

 

 

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

 

$

41,499

 

$

37,263

 

$

47,697

 

$

36,942

 

$

34,151

 

$

78,762

 

$

67,430

 

 


(1) The sum of these two lines equates to our consolidated joint venture partners’ share of FFO.

 

7



 

Summary of Wholly Owned Operating Office Properties by Region - June 30, 2011

 

 

 

Operational

 

Under Construction/
Redevelopment

 

Property Region and Business Park/Submarket 

 

# of
Properties

 

Total
Square Feet

 

Occupancy
%

 

Leased
 %

 

# of
Properties

 

Total
Square Feet

 

Baltimore/Washington Corridor:

 

 

 

 

 

 

 

 

 

 

 

 

 

National Business Park

 

24

 

2,880,564

 

99

%

100

%

3

 

344,095

 

Columbia Gateway

 

28

 

2,221,062

 

84

%

88

%

 

 

Airport Square/bwtech

 

26

 

1,943,067

 

87

%

87

%

 

 

Columbia South

 

18

 

813,404

 

87

%

92

%

1

 

89,295

 

Commons/Parkway

 

11

 

505,220

 

77

%

78

%

 

 

Other

 

1

 

155,000

 

100

%

100

%

 

 

Subtotal

 

108

 

8,518,317

 

90

%

92

%

4

 

433,390

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Northern Virginia:

 

 

 

 

 

 

 

 

 

 

 

 

 

Westfields Corporate Center

 

9

 

1,464,065

 

85

%

85

%

 

 

Tysons Corner/Merrifield

 

4

 

650,228

 

96

%

96

%

1

 

140,530

 

Herndon

 

2

 

548,334

 

85

%

93

%

 

 

Dulles Tech

 

2

 

165,490

 

87

%

91

%

 

 

Patriot Ridge

 

 

 

0

%

0

%

1

 

240,581

 

Subtotal

 

17

 

2,828,117

 

88

%

89

%

2

 

381,111

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Suburban Maryland

 

5

 

711,459

 

71

%

84

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Washington, DC- Capital Riverfront

 

2

 

362,209

 

95

%

98

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

St. Mary’s & King George Counties:

 

 

 

 

 

 

 

 

 

 

 

 

 

St. Mary’s County

 

12

 

614,543

 

84

%

84

%

1

 

82,842

 

King George County

 

6

 

206,149

 

95

%

97

%

 

 

Subtotal

 

18

 

820,692

 

87

%

87

%

1

 

82,842

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Greater Baltimore:

 

 

 

 

 

 

 

 

 

 

 

 

 

White Marsh

 

35

 

1,577,401

 

78

%

78

%

 

 

Towson/Rte 83 Corridor

 

15

 

1,258,419

 

0

%

0

%

 

 

Canton Crossing-Baltimore City

 

1

 

481,276

 

91

%

94

%

 

 

Baltimore County Westside

 

13

 

363,013

 

86

%

88

%

 

 

Harford County-Northgate Business Park

 

2

 

104,743

 

95

%

100

%

2

 

180,141

 

Subtotal

 

66

 

3,784,852

 

84

%

85

%

2

 

180,141

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Colorado Springs:

 

 

 

 

 

 

 

 

 

 

 

 

 

Colorado Springs East

 

11

 

724,064

 

75

%

76

%

 

 

I-25 North Corridor

 

7

 

522,808

 

66

%

66

%

 

 

Colorado Springs Northwest

 

3

 

322,464

 

94

%

96

%

 

 

Subtotal

 

21

 

1,569,336

 

76

%

77

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

San Antonio, Texas

 

8

 

915,429

 

100

%

100

%

1

 

94,961

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Greater Philadelphia, Pennsylvania

 

2

 

437,718

 

86

%

100

%

1

 

113,800

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Virginia

 

2

 

295,842

 

100

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

249

 

20,243,971

 

87

%

89

%

11

 

1,286,245

 

 

8



 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2011

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of Buildings

 

108

 

17

 

66

 

5

 

18

 

21

 

8

 

2

 

2

 

2

 

249

 

Rentable Square Feet

 

8,518,317

 

2,828,117

 

3,784,852

 

711,459

 

820,692

 

1,569,336

 

915,429

 

437,718

 

362,209

 

295,842

 

20,243,971

 

Occupied %

 

90.0

%

87.6

%

83.9

%

71.0

%

87.0

%

76.0

%

100.0

%

85.8

%

95.4

%

100.0

%

87.3

%

Leased %

 

91.8

%

89.3

%

85.1

%

84.0

%

87.4

%

76.7

%

100.0

%

99.7

%

98.3

%

100.0

%

89.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary of Operating, Construction and Redevelopment Office Properties Ownership at June 30, 2011

 

 

 

 

 

 

 

Consolidated

 

Unconsolidated

 

Total

 

 

 

Wholly-Owned

 

Consolidated JV

 

Portfolio

 

JV

 

Portfolio

 

Operating Properties

 

 

 

 

 

 

 

 

 

 

 

# of Properties

 

249

 

4

 

253

 

16

 

269

 

Total Square Feet

 

20,243,971

 

441,758

 

20,685,729

 

671,260

 

21,356,989

 

Leased Square Feet

 

18,090,798

 

265,706

 

18,356,504

 

478,495

 

18,834,999

 

% Leased

 

89.4

%

60.1

%

88.7

%

71.3

%

88.2

%

 

 

 

 

 

 

 

 

 

 

 

 

Under Construction

 

 

 

 

 

 

 

 

 

 

 

# of Properties

 

9

 

1

 

10

 

 

10

 

Total Square Feet

 

1,059,466

 

114,891

 

1,174,357

 

 

1,174,357

 

 

 

 

 

 

 

 

 

 

 

 

 

Under Redevelopment

 

 

 

 

 

 

 

 

 

 

 

# of Properties

 

2

 

 

2

 

 

2

 

Total Square Feet

 

297,240

 

 

297,240

 

 

297,240

 

 

 

 

 

 

 

 

 

 

 

 

 

Partially Operational Prop. (1)

 

 

 

 

 

 

 

 

 

 

 

# of Constr.prop.

 

(1

)

 

(1

)

 

(1

)

# of Redevelop. Prop.

 

(1

)

 

(1

)

 

(1

)

Construction total sf

 

(27,551

)

 

(27,551

)

 

(27,551

)

Redevelop. total sf

 

(42,910

)

 

(42,910

)

 

(42,910

)

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

# of Properties

 

258

 

5

 

263

 

16

 

279

 

Total Square Feet

 

21,530,216

 

556,649

 

22,086,865

 

671,260

 

22,758,125

 

 


(1) Adjustment for partially operational properties included in both operating properties and under construction or redevelopment.

 

9


 


 

Office Properties by Region - June 30, 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

 

193,296

 

 

 

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

 

 

 

 

 

316 National Business Parkway

 

BWI Airport

 

NBP

 

 

 

M

 

 

 

125,150

 

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

 

 

 

 

 

430 National Business Parkway

 

BWI Airport

 

NBP

 

2011

 

M

 

 

 

109,407

 

 

 

410 National Business Parkway

 

BWI Airport

 

NBP

 

 

 

M

 

 

 

109,538

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,880,564

 

344,095

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

67,083

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,815,809

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

1341 Ashton Road

 

BWI Airport

 

Comm./Pkwy.

 

1989

 

S

 

15,314

 

 

 

11

 

1343 Ashton Road

 

BWI Airport

 

Comm./Pkwy.

 

1989

 

S

 

9,903

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

505,220

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

59

 

Subtotal (continued on next page)

 

 

 

 

 

 

 

 

 

5,201,593

 

344,095

 

 

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

 

10


 


 

Office Properties by Region - June 30, 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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

59

 

Subtotal (continued from prior page)

 

 

 

 

 

 

 

 

 

5,201,593

 

344,095

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

7205 Riverwood Drive

 

Howard Co. Perimeter

 

Rivers Corporate Park

 

 

 

 

 

 

 

89,295

 

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

 

89,295

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

9720 Patuxent Woods Drive

 

Howard Co. Perimeter

 

Owen Brown South

 

1986/2001

 

M

 

39,480

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

153,390

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

9020 Mendenhall Court

 

Howard Co. Perimeter

 

Sieling Business Park

 

1982/2005

 

S

 

47,603

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

108

 

Total Baltimore/Washington Corridor

 

 

 

 

 

 

 

8,518,317

 

433,390

 

 

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

 


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

 

11



 

Office Properties by Region - June 30, 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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

45310 Abell House Lane

 

St. Mary’s County

 

Wildewood Tech Park

 

 

 

M

 

 

 

82,842

 

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

 

82,842

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

82,842

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

152,993

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,464,065

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

13200 Woodland Park Road

 

Herndon

 

Woodland Park

 

2002

 

M

 

396,837

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

13454 Sunrise Valley Road

 

Herndon

 

Dulles Tech

 

1998

 

M

 

112,111

 

 

 

2

 

13450 Sunrise Valley Road

 

Herndon

 

Dulles Tech

 

1998

 

M

 

53,379

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

165,490

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

3120 Fairview Park Drive

 

Merrifield

 

Fairview Park

 

2008

 

M

 

42,910

 

140,530

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7770 Backlick Road

 

Springfield

 

Patriot Ridge

 

 

 

 

 

 

 

240,581

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

1751 Pinnacle Drive

 

Tysons Corner

 

 

 

1989/1995

 

M

 

260,150

 

 

 

2

 

1753 Pinnacle Drive

 

Tysons Corner

 

 

 

1976/2004

 

M

 

186,707

 

 

 

3

 

1550 Westbranch Drive

 

Tysons Corner

 

 

 

2002

 

M

 

160,461

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

607,318

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

2900 Towerview Road

 

Herndon

 

Renaissance Park

 

1982/2008

 

M

 

151,497

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

17

 

Total Northern Virginia

 

 

 

 

 

 

 

 

 

2,828,117

 

381,111

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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.

 

12


 


 

Office Properties by Region - June 30, 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

 

218,653

 

 

 

 

 

751 Arbor Way

 

Blue Bell

 

Arborcrest

 

 

 

 

 

 

 

113,800

 

2

 

Total Greater Philadelphia

 

 

 

 

 

 

 

 

 

437,718

 

113,800

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

100 Sentry Gateway

 

San Antonio Northwest

 

Sentry Gateway

 

 

 

 

 

 

 

94,961

 

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

 

94,961

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

94,961

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Colorado Springs, Colorado

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

985 Space Center Drive

 

Colorado Springs East

 

Patriot Park

 

1989

 

M

 

104,028

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

396,604

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

1,569,336

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Washington, DC - Capitol Riverfront

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

1201 M Street

 

Washington, DC - Capitol River

 

Maritime Plaza

 

2001

 

M

 

203,296

 

 

 

2

 

1220 12th Street

 

Washington, DC - Capitol River

 

Maritime Plaza

 

2003

 

M

 

158,913

 

 

 

 

 

Total Washington, DC - Capitol Riverfront

 

 

 

 

 

 

 

 

 

362,209

 

 

 

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

 

13



 

Office Properties by Region - June 30, 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

 

53,959

 

 

 

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

 

8,810

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

363,013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

481,276

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

206 Research Boulevard

 

Harford County

 

Northgate Business Park

 

 

 

 

 

 

 

128,119

 

1

 

209 Research Boulevard

 

Harford County

 

Northgate Business Park

 

2010

 

M

 

77,192

 

 

 

2

 

210 Research Boulevard

 

Harford County

 

Northgate Business Park

 

2010

 

M

 

27,551

 

52,022

 

 

 

 

 

 

 

 

 

 

 

 

 

104,743

 

180,141

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

31

 

Subtotal (continued on next page)

 

 

 

 

 

 

 

 

 

2,207,451

 

180,141

 

 

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

 

14



 

Office Properties by Region - June 30, 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)

 

 

 

 

 

 

 

 

 

2,207,451

 

180,141

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

3,784,852

 

180,141

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

249

 

TOTAL WHOLLY-OWNED OFFICE PROPERTY PORTFOLIO

 

 

 

 

 

 

 

 

 

20,243,971

 

1,286,245

 

 

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

 

15



 

Renewal Analysis for Wholly Owned Office Properties

for Periods Ended June 30, 2011

 

 

 

Baltimore/
Washington
Corridor

 

Northern
Virginia

 

Greater
Baltimore

 

Suburban
Maryland

 

St. Mary’s and
King George
Counties

 

Colorado
Springs

 

Greater
Philadelphia

 

Washington
DC-Capital
Riverfront

 

Total
Office

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended June 30, 2011:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expiring Square Feet

 

135,443

 

78,298

 

313,605

 

51,623

 

44,878

 

19,617

 

219,065

 

3,443

 

865,972

 

Vacated Square Feet

 

15,936

 

9,191

 

40,764

 

 

23,004

 

5,178

 

 

3,443

 

97,516

 

Renewed Square Feet

 

119,507

 

69,107

 

272,841

 

51,623

 

21,874

 

14,439

 

219,065

 

 

768,456

 

Retention Rate (% based upon square feet)

 

88.2

%

88.3

%

87.0

%

100.0

%

48.7

%

73.6

%

100.0

%

0.0

%

88.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Renewed Space Only:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Committed Cost per Square Foot

 

$

6.53

 

$

31.32

 

$

16.51

 

$

13.83

 

$

3.22

 

$

5.09

 

$

2.37

 

$

0.00

 

$

11.49

 

Weighted Average Lease Term in years

 

4.7

 

10.0

 

5.0

 

5.4

 

1.6

 

2.7

 

3.0

 

 

4.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in Total Rent - GAAP

 

-0.8

%

4.2

%

2.6

%

-16.4

%

7.3

%

3.8

%

7.8

%

0

%

1.7

%

Change in Total Rent - Cash

 

-8.3

%

-10.1

%

-9.1

%

-20.3

%

2.3

%

-3.9

%

2.8

%

0

%

-7.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Renewed & Retenanted Space:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leased Square Feet

 

171,907

 

109,628

 

295,520

 

57,458

 

32,750

 

24,631

 

219,065

 

 

910,959

 

Average Committed Cost per Square Foot

 

$

9.43

 

$

37.55

 

$

15.88

 

$

13.71

 

$

6.58

 

$

3.44

 

$

2.37

 

$

0.00

 

$

13.21

 

Weighted Average Lease Term in years

 

4.4

 

10.1

 

4.8

 

5.4

 

2.0

 

2.5

 

3.0

 

 

4.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in Total Rent - GAAP

 

6.2

%

3.1

%

2.1

%

-20.3

%

11.7

%

-7.1

%

7.8

%

0.0

%

2.1

%

Change in Total Rent - Cash

 

-2.5

%

-10.1

%

-9.1

%

-23.4

%

5.6

%

-14.0

%

2.8

%

0.0

%

-7.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction and Redevelopment Space:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leased Square Feet

 

63,764

 

 

 

 

 

 

 

 

63,764

 

Average Committed Cost Per Square Foot

 

$

48.65

 

$

 

$

 

$

 

$

 

$

 

$

 

$

 

$

48.65

 

Weighted Average Lease Term in years

 

7.5

 

 

 

 

 

 

 

 

7.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other First Generation Space

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leased Square Feet

 

11,775

 

 

38,935

 

 

 

10,015

 

 

 

60,725

 

Average Committed Cost Per Square Foot

 

$

40.19

 

$

 

$

37.30

 

$

 

$

 

$

22.31

 

$

 

$

 

$

35.39

 

Weighted Average Lease Term in years

 

6.7

 

 

6.5

 

 

 

4.4

 

 

 

6.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Square Feet Leased

 

247,446

 

109,628

 

334,455

 

57,458

 

32,750

 

34,646

 

219,065

 

 

1,035,448

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2011:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expiring Square Feet

 

439,869

 

571,968

 

559,471

 

93,298

 

52,665

 

86,532

 

219,065

 

21,413

 

2,044,281

 

Vacated Square Feet

 

110,592

 

181,782

 

153,216

 

 

23,004

 

5,178

 

 

18,201

 

491,973

 

Renewed Square Feet

 

329,277

 

390,186

 

406,255

 

93,298

 

29,661

 

81,354

 

219,065

 

3,212

 

1,552,308

 

Retention Rate (% based upon square feet)

 

74.9

%

68.2

%

72.6

%

100.0

%

56.3

%

94.0

%

100.0

%

15.0

%

75.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Renewed Space Only:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Committed Cost per Square Foot

 

$

15.98

 

$

6.34

 

$

16.96

 

$

9.53

 

$

3.21

 

$

13.24

 

$

2.37

 

$

0.91

 

$

11.09

 

Weighted Average Lease Term in years

 

6.2

 

2.7

 

5.0

 

3.9

 

1.7

 

4.6

 

3.1

 

1.0

 

4.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in Total Rent - GAAP

 

3.5

%

4.1

%

3.7

%

-9.5

%

-0.2

%

14.2

%

7.8

%

5.4

%

3.6

%

Change in Total Rent - Cash

 

-2.2

%

-0.7

%

-9.0

%

-12.2

%

-4.8

%

-2.1

%

2.8

%

4.8

%

-4.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Renewed & Retenanted Space:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leased Square Feet

 

495,771

 

501,332

 

437,463

 

99,133

 

53,488

 

91,546

 

219,065

 

14,587

 

1,912,385

 

Average Committed Cost per Square Foot

 

$

19.25

 

$

15.26

 

$

16.37

 

$

9.71

 

$

8.12

 

$

11.89

 

$

2.37

 

$

0.91

 

$

14.47

 

Weighted Average Lease Term in years

 

6.1

 

3.8

 

4.9

 

4.0

 

1.7

 

4.3

 

3.0

 

1.0

 

4.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in Total Rent - GAAP

 

3.8

%

3.7

%

2.7

%

-12.7

%

13.5

%

8.9

%

7.8

%

3.2

%

3.2

%

Change in Total Rent - Cash

 

-1.8

%

-1.2

%

-9.4

%

-15.1

%

8.7

%

-5.8

%

2.8

%

0.3

%

-4.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction and Redevelopment Space:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leased Square Feet

 

102,508

 

62,442

 

 

 

 

 

60,609

 

 

225,559

 

Average Committed Cost Per Square Foot

 

$

45.87

 

$

78.29

 

$

 

$

 

$

 

$

 

$

54.75

 

$

 

$

57.23

 

Weighted Average Lease Term in years

 

6.5

 

7.7

 

 

 

 

 

10.0

 

 

7.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other First Generation Space

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leased Square Feet

 

28,921

 

 

42,031

 

 

 

12,550

 

 

 

83,502

 

Average Committed Cost Per Square Foot

 

$

25.38

 

$

 

$

36.86

 

$

 

$

 

$

21.85

 

$

 

$

 

$

30.63

 

Weighted Average Lease Term in years

 

5.9

 

 

6.5

 

 

 

4.6

 

 

 

6.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Square Feet Leased

 

627,200

 

563,774

 

479,494

 

99,133

 

53,488

 

104,096

 

279,674

 

14,587

 

2,221,446

 

 

Notes:

No renewal or retenanting activity transpired in our San Antonio 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



 

Lease Expiration Analysis

(wholly owned office properties)

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

Annual. Rental

 

Percentage

 

Annual. Rental

 

 

 

 

 

Square

 

 

 

Percentage

 

Revenue of

 

of Total 

 

Revenue of

 

Year and Region

 

Number

 

Footage

 

Percentage of 

 

of Total

 

Expiring

 

Annualized Rental 

 

Expiring Leases

 

of Lease

 

of Leases

 

of Leases

 

Period’s Expiring

 

Occupied

 

Leases (3)

 

Revenue 

 

per Occupied

 

Expiration (2)

 

Expiring

 

Expiring

 

Square Feet

 

Square Feet

 

(000’s)

 

Expiring

 

Square Foot

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

41

 

520,364

 

49.0

%

2.9

%

$

13,095

 

2.9

%

$

25.17

 

Northern Virginia

 

4

 

50,942

 

4.8

%

0.3

%

1,568

 

0.3

%

30.77

 

Greater Baltimore

 

36

 

220,328

 

20.7

%

1.2

%

4,484

 

1.0

%

20.35

 

Suburban Maryland

 

2

 

31,132

 

2.9

%

0.2

%

854

 

0.2

%

27.45

 

St. Mary’s and King George Cos.

 

8

 

103,756

 

9.8

%

0.6

%

2,039

 

0.4

%

19.65

 

Colorado Springs

 

3

 

59,053

 

5.6

%

0.3

%

910

 

0.2

%

15.42

 

Washington, DC-Capitol Riverfront

 

6

 

76,881

 

7.2

%

0.4

%

3,680

 

0.8

%

47.87

 

2011

 

100

 

1,062,456

 

100.0

%

6.0

%

26,631

 

5.8

%

25.07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

46

 

1,006,337

 

49.0

%

5.7

%

25,425

 

5.6

%

25.27

 

Northern Virginia

 

17

 

130,181

 

6.3

%

0.7

%

3,969

 

0.9

%

30.49

 

Greater Baltimore

 

63

 

454,303

 

22.1

%

2.6

%

9,387

 

2.1

%

20.66

 

Suburban Maryland

 

2

 

18,423

 

0.9

%

0.1

%

323

 

0.1

%

17.52

 

St. Mary’s and King George Cos.

 

13

 

292,687

 

14.2

%

1.7

%

5,555

 

1.2

%

18.98

 

Colorado Springs

 

7

 

69,430

 

3.4

%

0.4

%

1,389

 

0.3

%

20.00

 

San Antonio

 

2

 

78,359

 

3.8

%

0.4

%

1,392

 

0.3

%

17.76

 

Washington, DC-Capitol Riverfront

 

2

 

4,709

 

0.2

%

0.0

%

220

 

0.0

%

46.72

 

2012

 

152

 

2,054,429

 

100.0

%

11.6

%

47,659

 

10.4

%

23.20

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

52

 

1,199,574

 

58.3

%

6.8

%

37,557

 

8.2

%

31.31

 

Northern Virginia

 

10

 

125,933

 

6.1

%

0.7

%

3,235

 

0.7

%

25.69

 

Greater Baltimore

 

47

 

345,919

 

16.8

%

2.0

%

7,316

 

1.6

%

21.15

 

Suburban Maryland

 

2

 

8,909

 

0.4

%

0.1

%

242

 

0.1

%

27.16

 

St. Mary’s and King George Cos.

 

8

 

116,891

 

5.7

%

0.7

%

2,119

 

0.5

%

18.13

 

Colorado Springs

 

10

 

129,519

 

6.3

%

0.7

%

2,579

 

0.6

%

19.91

 

Washington, DC-Capitol Riverfront

 

5

 

132,113

 

6.4

%

0.7

%

5,706

 

1.2

%

43.19

 

2013

 

134

 

2,058,858

 

100.0

%

11.7

%

58,755

 

12.8

%

28.54

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

48

 

726,331

 

37.8

%

4.1

%

20,678

 

4.5

%

28.47

 

Northern Virginia

 

8

 

465,652

 

24.2

%

2.6

%

14,166

 

3.1

%

30.42

 

Greater Baltimore

 

39

 

333,026

 

17.3

%

1.9

%

6,172

 

1.3

%

18.53

 

Suburban Maryland

 

4

 

88,166

 

4.6

%

0.5

%

1,809

 

0.4

%

20.52

 

St. Mary’s and King George Cos.

 

11

 

60,328

 

3.1

%

0.3

%

1,369

 

0.3

%

22.69

 

Colorado Springs

 

9

 

178,558

 

9.3

%

1.0

%

3,485

 

0.8

%

19.51

 

Washington, DC-Capitol Riverfront

 

6

 

70,200

 

3.7

%

0.4

%

3,098

 

0.7

%

44.13

 

2014

 

125

 

1,922,261

 

100.0

%

10.9

%

50,777

 

11.1

%

26.42

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

53

 

1,173,639

 

38.9

%

6.6

%

32,950

 

7.2

%

28.08

 

Northern Virginia

 

11

 

885,942

 

29.4

%

5.0

%

25,591

 

5.6

%

28.89

 

Greater Baltimore

 

38

 

389,204

 

12.9

%

2.2

%

7,181

 

1.6

%

18.45

 

Suburban Maryland

 

4

 

134,962

 

4.5

%

0.8

%

2,627

 

0.6

%

19.47

 

St. Mary’s and King George Cos.

 

8

 

76,199

 

2.5

%

0.4

%

1,308

 

0.3

%

17.17

 

Greater Philadelphia

 

1

 

219,065

 

7.3

%

1.2

%

2,829

 

0.6

%

12.92

 

Colorado Springs

 

9

 

104,408

 

3.5

%

0.6

%

1,972

 

0.4

%

18.89

 

Washington, DC-Capitol Riverfront

 

3

 

30,599

 

1.0

%

0.2

%

1,378

 

0.3

%

45.04

 

2015

 

127

 

3,014,018

 

100.0

%

17.1

%

75,837

 

16.6

%

25.16

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

106

 

3,041,436

 

40.3

%

17.2

%

79,485

 

17.4

%

26.13

 

Northern Virginia

 

31

 

818,170

 

10.8

%

4.6

%

25,725

 

5.6

%

31.44

 

Greater Baltimore

 

78

 

1,431,173

 

19.0

%

8.1

%

34,101

 

7.5

%

23.83

 

Suburban Maryland

 

5

 

223,213

 

3.0

%

1.3

%

5,334

 

1.2

%

23.90

 

St. Mary’s and King George Cos.

 

5

 

63,993

 

0.8

%

0.4

%

1,275

 

0.3

%

19.92

 

Greater Philadelphia

 

1

 

156,695

 

2.1

%

0.9

%

3,898

 

0.9

%

24.88

 

Colorado Springs

 

13

 

652,361

 

8.6

%

3.7

%

13,557

 

3.0

%

20.78

 

San Antonio

 

6

 

837,070

 

11.1

%

4.7

%

24,557

 

5.4

%

29.34

 

Washington, DC-Capitol Riverfront

 

3

 

31,116

 

0.4

%

0.2

%

1,341

 

0.3

%

43.10

 

Other

 

2

 

295,842

 

3.9

%

1.7

%

8,741

 

1.9

%

29.55

 

Thereafter

 

250

 

7,551,069

 

100.0

%

42.8

%

198,016

 

43.3

%

26.22

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total / Average

 

888

 

17,663,091

 

 

 

100.0

%

$

457,675

 

100.0

%

$

25.91

 

 

NOTE:  As of June 30, 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 422,274 square feet yet to commence as of June 30, 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 June 30, 2011 multiplied by 12 plus the estimated annualized expense reimbursements under existing office leases.

 

17



 

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

 

3,230,929

 

18.3

%

$

98,431

 

21.5

%

5.9

 

Northrop Grumman Corporation

(5)

17

 

1,207,248

 

6.8

%

32,032

 

7.0

%

6.5

 

Booz Allen Hamilton, Inc.

 

9

 

806,352

 

4.6

%

24,868

 

5.4

%

4.9

 

Computer Sciences Corporation

(5)

6

 

609,548

 

3.5

%

18,627

 

4.1

%

3.4

 

The MITRE Corporation

 

4

 

284,819

 

1.6

%

8,275

 

1.8

%

5.6

 

ITT Corporation

(5)

9

 

332,490

 

1.9

%

8,162

 

1.8

%

3.6

 

Wells Fargo & Company

(5)

6

 

214,982

 

1.2

%

7,789

 

1.7

%

7.0

 

The Aerospace Corporation

 

3

 

254,869

 

1.4

%

7,729

 

1.7

%

3.6

 

L-3 Communications Holdings, Inc.

(5)

4

 

258,192

 

1.5

%

7,527

 

1.6

%

2.7

 

CareFirst, Inc.

 

2

 

222,610

 

1.3

%

7,247

 

1.6

%

10.2

 

Integral Systems, Inc.

(5)

4

 

241,627

 

1.4

%

6,558

 

1.4

%

8.5

 

Comcast Corporation

(5)

7

 

308,332

 

1.7

%

6,156

 

1.3

%

2.3

 

The Boeing Company

(5)

6

 

196,939

 

1.1

%

6,064

 

1.3

%

3.3

 

General Dynamics Corporation

(5)

6

 

208,264

 

1.2

%

5,894

 

1.3

%

4.1

 

AT&T Corporation

(5)

4

 

317,570

 

1.8

%

5,452

 

1.2

%

7.5

 

Ciena Corporation

 

5

 

270,557

 

1.5

%

5,072

 

1.1

%

1.7

 

Raytheon Company

 

6

 

156,728

 

0.9

%

4,270

 

0.9

%

3.0

 

Unisys Corporation

 

1

 

156,695

 

0.9

%

3,898

 

0.9

%

8.9

 

The Johns Hopkins Institutions

(5)

5

 

141,403

 

0.8

%

3,672

 

0.8

%

5.3

 

Magellan Health Services, Inc.

 

2

 

118,807

 

0.7

%

2,996

 

0.7

%

8.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Top 20 Office Tenants

 

183

 

9,538,961

 

54.0

%

270,720

 

59.2

%

5.4

 

All remaining tenants

 

705

 

8,124,130

 

46.0

%

186,954

 

40.8

%

4.2

 

Total/Weighted Average

 

888

 

17,663,091

 

100.0

%

$

457,675

 

100.0

%

4.9

 

 


(1)

Table excludes owner occupied leasing activity which represents 173,531 square feet with total annualized rental revenue of $4.2 million, and a weighted average remaining lease term of 4.6 years as of June 30, 2011.

(2)

Total Annualized Rental Revenue is the monthly contractual base rent as of June 30, 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.

 

18



 

Real Estate Revenues* by Region

(dollars in thousands)

 

 

 

Three Months Ended

 

Six Months Ended

 

Office Properties:

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

6/30/11

 

6/30/10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

$

52,860

 

$

53,252

 

$

52,829

 

$

51,946

 

$

50,623

 

$

106,112

 

$

102,681

 

Northern Virginia

 

18,445

 

18,274

 

19,283

 

18,949

 

18,172

 

36,719

 

36,831

 

Greater Baltimore

 

17,846

 

17,612

 

18,870

 

18,288

 

16,827

 

35,458

 

34,692

 

Colorado Springs

 

5,912

 

5,920

 

6,235

 

6,176

 

6,154

 

11,832

 

12,486

 

Suburban Maryland

 

5,325

 

5,609

 

5,235

 

5,243

 

5,452

 

10,934

 

11,281

 

St. Mary’s and King George Counties

 

3,564

 

3,534

 

3,417

 

3,431

 

3,530

 

7,098

 

7,119

 

San Antonio

 

7,089

 

7,663

 

7,898

 

5,609

 

4,228

 

14,752

 

8,166

 

Washington, DC - Capitol Riverfront

 

4,252

 

4,590

 

4,543

 

135

 

 

8,842

 

 

Greater Philadelphia

 

1,675

 

1,939

 

1,794

 

1,793

 

1,510

 

3,614

 

2,712

 

Wholesale Data Center

 

1,276

 

1,210

 

900

 

162

 

 

2,486

 

 

Other

 

2,562

 

2,838

 

2,709

 

3,296

 

3,495

 

5,400

 

7,019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate revenues

 

$

120,806

 

$

122,441

 

$

123,713

 

$

115,028

 

$

109,991

 

$

243,247

 

$

222,987

 

 

NOI* by Region

(dollars in thousands)

 

 

 

Three Months Ended

 

Six Months Ended

 

Office Properties:

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

6/30/11

 

6/30/10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

$

34,535

 

$

31,862

 

$

33,442

 

$

33,001

 

$

33,770

 

$

66,397

 

$

63,673

 

Northern Virginia

 

11,071

 

10,603

 

12,382

 

11,754

 

11,466

 

21,674

 

22,812

 

Greater Baltimore

 

10,577

 

9,072

 

11,528

 

10,460

 

9,516

 

19,649

 

18,371

 

Colorado Springs

 

3,835

 

3,484

 

4,026

 

3,796

 

3,915

 

7,319

 

7,938

 

Suburban Maryland

 

3,091

 

2,891

 

3,096

 

2,625

 

3,253

 

5,982

 

6,381

 

St. Mary’s and King George Counties

 

2,594

 

2,518

 

2,377

 

2,279

 

2,489

 

5,112

 

4,971

 

San Antonio

 

3,881

 

3,794

 

3,877

 

2,912

 

2,128

 

7,675

 

4,437

 

Washington, DC - Capitol Riverfront

 

2,595

 

2,963

 

2,835

 

135

 

 

5,558

 

 

Greater Philadelphia

 

1,300

 

1,493

 

1,315

 

1,561

 

710

 

2,793

 

1,149

 

Wholesale Data Center

 

445

 

504

 

(51

)

(89

)

 

949

 

 

Other

 

1,428

 

2,352

 

1,867

 

2,290

 

2,600

 

3,780

 

4,815

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI

 

$

75,352

 

$

71,536

 

$

76,694

 

$

70,724

 

$

69,847

 

$

146,888

 

$

134,547

 

 


*Includes continuing and discontinued operations.

 

19



 

Same Office Properties (1) Average Occupancy Rates by Region

 

 

 

Number

 

Rentable

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

of

 

Square

 

Three Months Ended

 

Six Months Ended

 

 

 

Buildings

 

Feet

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

6/30/11

 

6/30/10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore Washington Corridor

 

97

 

7,936,405

 

89.0

%

89.0

%

88.8

%

88.8

%

89.1

%

89.0

%

89.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Northern Virginia

 

14

 

2,473,249

 

88.9

%

87.7

%

91.0

%

91.1

%

95.9

%

88.3

%

96.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Greater Baltimore

 

35

 

2,635,072

 

87.3

%

88.1

%

84.5

%

82.9

%

83.3

%

87.7

%

83.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Suburban Maryland

 

5

 

595,599

 

74.4

%

75.0

%

76.3

%

73.7

%

72.3

%

74.7

%

81.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

St.Mary’s and King George Counties

 

12

 

585,699

 

97.7

%

97.7

%

96.4

%

98.4

%

98.9

%

97.7

%

98.6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Colorado Springs

 

18

 

1,266,214

 

86.5

%

86.5

%

86.7

%

85.5

%

87.1

%

86.5

%

87.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

San Antonio

 

6

 

665,117

 

100.0

%

100.0

%

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

%

100.0

%

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

2

 

295,842

 

100.0

%

100.0

%

100.0

%

100.0

%

100.0

%

100.0

%

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Office

 

190

 

16,672,262

 

89.1

%

89.1

%

88.9

%

88.6

%

89.6

%

89.1

%

89.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total same office properties occupancy as of period end

 

 

 

 

 

89.1

%

88.7

%

89.4

%

88.7

%

89.5

%

 

 

 

 

 


(1)   Same office properties represent buildings owned and 100% operational since January 1, 2010, excluding properties identified for future disposition under our Strategic Reallocation Plan.

 

20



 

Same Office Property Real Estate Revenues by Region

(dollars in thousands)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

6/30/11

 

6/30/10

 

Office Properties:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

$

48,220

 

$

49,256

 

$

49,529

 

$

49,098

 

$

49,041

 

$

97,476

 

$

99,591

 

Northern Virginia

 

16,887

 

16,420

 

17,418

 

16,955

 

17,483

 

33,307

 

35,419

 

Greater Baltimore

 

13,278

 

13,223

 

13,102

 

13,897

 

12,812

 

26,501

 

26,346

 

Colorado Springs

 

5,461

 

5,316

 

5,862

 

5,622

 

5,671

 

10,777

 

11,509

 

Suburban Maryland

 

3,595

 

3,902

 

3,482

 

3,365

 

3,446

 

7,497

 

7,314

 

St. Mary’s and King George Counties

 

3,008

 

2,957

 

2,827

 

2,754

 

2,812

 

5,965

 

5,679

 

San Antonio

 

5,250

 

5,869

 

5,964

 

5,039

 

4,228

 

11,119

 

8,166

 

Greater Philadelphia

 

715

 

506

 

741

 

825

 

694

 

1,221

 

1,220

 

Other

 

2,150

 

2,437

 

2,513

 

2,551

 

2,481

 

4,587

 

5,014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate revenues

 

$

98,564

 

$

99,886

 

$

101,438

 

$

100,106

 

$

98,668

 

$

198,450

 

$

200,258

 

 

Same Office Property NOI by Region

(dollars in thousands)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

6/30/11

 

6/30/10

 

Office Properties:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

$

31,293

 

$

29,348

 

$

31,106

 

$

31,087

 

$

32,956

 

$

60,641

 

$

62,411

 

Northern Virginia

 

10,413

 

9,469

 

11,145

 

10,186

 

10,993

 

19,882

 

21,949

 

Greater Baltimore

 

8,055

 

7,454

 

8,005

 

8,330

 

7,460

 

15,509

 

14,638

 

Colorado Springs

 

3,766

 

3,375

 

4,085

 

3,734

 

3,881

 

7,141

 

7,745

 

Suburban Maryland

 

2,170

 

2,220

 

2,144

 

1,759

 

2,016

 

4,390

 

4,307

 

St. Mary’s and King George Counties

 

2,256

 

2,171

 

2,002

 

1,812

 

1,964

 

4,427

 

3,972

 

San Antonio

 

2,408

 

2,355

 

2,402

 

2,398

 

2,173

 

4,763

 

4,521

 

Greater Philadelphia

 

680

 

457

 

713

 

763

 

680

 

1,137

 

1,193

 

Other

 

1,920

 

2,211

 

2,179

 

2,192

 

2,140

 

4,131

 

4,287

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI

 

$

62,961

 

$

59,060

 

$

63,781

 

$

62,261

 

$

64,263

 

$

122,021

 

$

125,023

 

Add (less): Straight-line rent adjustments

 

(1,581

)

(3,081

)

(1,273

)

1,914

 

(1,511

)

(4,662

)

(3,842

)

Less: Amortization of deferred market rental revenue

 

(193

)

(239

)

(279

)

(279

)

(281

)

(432

)

(736

)

Same office property cash NOI

 

$

61,187

 

$

55,740

 

$

62,229

 

$

63,896

 

$

62,471

 

$

116,927

 

$

120,445

 

Less: Lease termination fees, gross

 

(46

)

(137

)

(945

)

(109

)

(976

)

(183

)

(1,066

)

Same office property cash NOI, excluding gross lease termination fees

 

$

61,141

 

$

55,603

 

$

61,284

 

$

63,787

 

$

61,495

 

$

116,744

 

$

119,379

 

 

Note:  Same office properties represent buildings owned and 100% operational since January 1, 2010, excluding properties identified for future disposition under our Strategic Reallocation Plan.

 

21



 

Disposition Summary for Wholly Owned Operating Office Properties  — Six Months Ended June 30, 2011

 

Location

 

Property Region

 

Business Park/Submarket

 

Square Feet

 

Sale Date

 

Allocated
Contractual Sale
Price (in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

1350 Dorsey Road

 

Baltimore/Washington Corridor

 

Commons/Parkway

 

18,704

 

5/24/11

 

$

1,700

 

1344 Ashton Road

 

Baltimore/Washington Corridor

 

Commons/Parkway

 

17,066

 

5/24/11

 

1,300

 

1348 Ashton Road

 

Baltimore/Washington Corridor

 

Commons/Parkway

 

3,184

 

5/24/11

 

800

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

 

 

38,954

 

 

 

$

3,800

 

 

22



 

Construction, Development and Land Controlled Summary

(dollars in thousands)

 

 

 

Rentable Square Feet

 

 

 

Listed

 

Listed

 

Listed

 

Listed

 

Listed

 

 

 

 

 

 

 

Construction

 

Development

 

Redevelopment

 

Wholesale Data

 

Controlled

 

 

 

 

 

 

 

Projects

 

Projects

 

Projects

 

Center

 

Land

 

Other

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

433,390

 

385,000

 

 

N/A

 

3,718,000

 

 

4,536,390

 

Northern Virginia

 

240,581

 

239,000

 

183,440

 

N/A

 

1,798,000

 

 

2,461,021

 

Greater Baltimore

 

207,692

 

 

 

N/A

 

3,071,600

 

 

3,279,292

 

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

 

82,842

 

 

 

N/A

 

124,000

 

 

206,842

 

San Antonio

 

94,961

 

218,830

 

 

N/A

 

1,033,000

 

 

1,346,791

 

Greater Philadelphia

 

 

 

113,800

 

N/A

 

790,000

 

 

903,800

 

Huntsville, Alabama

 

114,891

 

183,000

 

 

 

N/A

 

4,302,000

 

 

4,599,891

 

Other

 

 

 

 

N/A

 

967,000

 

 

967,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,174,357

 

1,025,830

 

297,240

 

N/A

 

20,202,600

 

 

22,700,027

 

 

 

 

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

 

Other

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baltimore/Washington Corridor

 

$

61,084

 

$

25,253

 

$

 

$

 

$

84,469

 

$

9,317

 

$

180,123

 

Northern Virginia

 

23,383

 

8,478

 

44,704

 

 

36,713

 

 

113,278

 

Greater Baltimore

 

30,514

 

 

 

 

80,941

 

295

 

111,750

 

Colorado Springs

 

 

 

 

 

48,358

 

215

 

48,573

 

Suburban Maryland

 

 

 

 

 

24,022

 

321

 

24,343

 

St. Mary’s and King George Counties

 

13,242

 

 

 

 

3,390

 

 

16,632

 

San Antonio

 

10,930

 

5,697

 

 

 

20,281

 

4,831

 

41,739

 

Greater Philadelphia

 

 

 

5,492

 

 

19,734

 

369

 

25,595

 

Huntsville, Alabama

 

5,533

 

1,026

 

 

 

12,940

 

 

19,499

 

Wholesale Data Center

 

 

 

 

169,285

 

 

 

169,285

 

Other

 

 

 

 

 

9,529

 

 

9,529

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

144,686

 

$

40,454

 

$

50,196

 

$

169,285

 

$

340,377

 

$

15,348

 

$

760,346

 

 

 

 

Costs to date, by Balance Sheet line Item

 

 

 

Listed

 

Listed

 

Listed

 

Listed

 

Listed

 

 

 

 

 

 

 

Construction

 

Development

 

Redevelopment

 

Wholesale Data

 

Controlled

 

 

 

 

 

 

 

Projects

 

Projects

 

Projects

 

Center

 

Land

 

Other

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating properties

 

$

5,992

 

$

 

$

44,704

 

$

31,084

 

$

20,293

 

$

 

$

102,073

 

Land - development

 

20,108

 

18,704

 

 

5,377

 

204,458

 

 

248,647

 

Properties under construction and development, excluding associated land costs

 

117,050

 

21,750

 

5,492

 

132,824

 

115,598

 

14,960

 

407,674

 

Deferred leasing costs

 

1,536

 

 

 

 

28

 

388

 

1,952

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

144,686

 

$

40,454

 

$

50,196

 

$

169,285

 

$

340,377

 

$

15,348

 

$

760,346

 

 


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

 

23


 


 

Land Controlled (1)

 

Location

 

Submarket

 

Status

 

Acres

 

 

 

Estimated
Developable
Square Feet

 

 

 

 

 

 

 

 

 

 

 

 

 

National Business Park - North

 

BWI Airport

 

Wholly owned

 

170

 

 

 

1,405,000

 

National Business Park - Cedar Knolls

 

BWI Airport

 

Wholly owned

 

7

 

 

 

260,000

 

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

 

1,382,000

 

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

 

 

 

 

 

272

 

 

 

3,718,000

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

499,000

 

Total Northern Virginia

 

 

 

 

 

72

 

 

 

1,798,000

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

39

 

 

 

566,600

 

Total Greater Baltimore

 

 

 

 

 

201

 

 

 

3,071,600

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

443

 

 

 

4,302,000

 

Total Huntsville

 

 

 

 

 

443

 

 

 

4,302,000

 

 

 

 

 

 

 

 

 

 

 

 

 

Indian Head

 

Charles County, MD

 

Consolidated JV - 75% interest

 

208

 

 

 

967,000

 

Fort Ritchie (2) 

 

Fort Ritchie

 

Wholly owned

 

591

 

 

 

 

Total Other

 

 

 

 

 

799

 

 

 

967,000

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL

 

 

 

 

 

2,272

 

 

 

20,202,600

 

 


(1)

This land inventory schedule excludes all properties listed as under construction, redevelopment or under development as detailed on pages 25 and 26, and includes properties under ground lease to us.

(2)

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

 

24


 


 

Summary of Construction Projects

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Actual or

 

 

 

 

 

 

 

 

 

Total

 

Percentage

 

as of June 30, 2011 (1)

 

Anticipated

 

 

 

 

 

 

 

 

 

Rentable

 

Leased

 

Anticipated

 

 

 

Cost to

 

Construction

 

Anticipated

 

 

 

Park/

 

 

 

Square

 

as of

 

total

 

Cost

 

date placed

 

Completion

 

Operational

 

Property and Location

 

Submarket

 

Ownership

 

Feet

 

6/30/11

 

cost

 

to date

 

in service

 

Date (2)

 

Date (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Under Construction

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

316 Sentinel Way (316 NBP)
Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

125,150

 

0

%

$

27,869

 

$

23,269

 

 

1Q 11

 

1Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7205 Riverwood Road
Columbia, Maryland

 

Howard Co. Perimeter

 

Wholly owned

 

89,295

 

0

%

18,900

 

9,874

 

 

4Q 11

 

4Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Government

 

 

 

 

 

214,445

 

0

%

$

46,769

 

$

33,143

 

$

 

 

 

 

 

% of Total Drivers

 

 

 

 

 

18

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

410 National Business Parkway
Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

109,538

 

0

%

$

25,643

 

$

11,765

 

 

4Q 11

 

4Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

430 National Business Parkway
Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

109,407

 

56

%

24,942

 

16,176

 

 

2Q 11

 

2Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7770 Backlick Road (Patriot Ridge)
Springfield, Virginia

 

Springfield

 

Wholly owned

 

240,581

 

0

%

77,172

 

23,383

 

 

2Q 12

 

2Q 13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

206 Research Boulevard
Aberdeen, Maryland

 

Harford County

 

Wholly owned

 

128,119

 

0

%

25,764

 

16,608

 

 

3Q 11

 

3Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

210 Research Boulevard
Aberdeen, Maryland

(4)

Harford County

 

Wholly owned

 

79,573

 

35

%

16,898

 

13,905

 

5,992

 

4Q 10

 

4Q 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

45310 Abell House Lane
California, Maryland

 

St. Mary’s County

 

Wholly owned

 

82,842

 

100

%

18,080

 

13,242

 

 

3Q 11

 

4Q 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

100 Sentry Gateway
San Antonio, Texas

 

San Antonio Northwest

 

Wholly owned

 

94,961

 

0

%

15,433

 

10,930

 

 

4Q 10

 

4Q 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1000 Redstone Gateway
Huntsville, Alabama

 

Huntsville

 

Consolidated Joint Venture

 

114,891

 

0

%

21,231

 

5,534

 

 

4Q 11

 

4Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Defense Information Technology

 

 

 

 

 

959,912

 

18

%

$

225,163

 

$

111,543

 

$

5,992

 

 

 

 

 

% of Total Drivers

 

 

 

 

 

82

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Under Construction

 

 

 

 

 

1,174,357

 

15

%

$

271,932

 

$

144,686

 

$

5,992

 

 

 

 

 

 


(1) Cost includes land, construction, leasing costs and allocated portion of structured parking and other shared infrastructure, if applicable.

(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,” 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.

 

25



 

Summary of Development and Redevelopment Projects

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Actual or

 

 

 

 

 

 

 

 

 

Total

 

Percentage

 

as of June 30, 2011 (1)

 

Anticipated

 

 

 

 

 

 

 

 

 

Rentable

 

Leased

 

Anticipated

 

 

 

Cost to

 

Construction

 

Anticipated

 

 

 

Park/

 

 

 

Square

 

as of

 

total

 

Cost

 

date placed

 

Completion

 

Operational

 

Property and Location

 

Submarket

 

Ownership

 

Feet

 

6/30/11

 

cost

 

to date

 

in service

 

Date (2)

 

Date (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Under Redevelopment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3120 Fairview Park Drive
Herndon, Virginia

(4)

Herndon

 

Wholly owned

 

183,440

 

36

%

$

57,800

 

$

44,704

 

$

44,704

 

4Q10

 

4Q11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

751 Arbor Way (Hillcrest I)
Blue Bell, Pennsylvania

 

Greater Philadelphia

 

Wholly owned

 

113,800

 

0

%

20,400

 

5,492

 

 

4Q 11

 

4Q 12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Redevelopment

 

 

 

 

 

297,240

 

 

 

$

78,200

 

$

50,196

 

$

44,704

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Under Development

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

312 Sentinel Way
Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

125,000

 

N/A

 

30,800

 

10,827

 

 

 

4Q 12

 

4Q 13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8100 Potranco Road
San Antonio, Texas

 

San Antonio Northwest

 

Wholly owned

 

125,000

 

N/A

 

25,200

 

3,393

 

 

 

1Q 13

 

1Q 14

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Government

 

 

 

 

 

250,000

 

 

 

$

56,000

 

$

14,220

 

 

 

 

 

 

 

% of Total Drivers

 

 

 

 

 

24

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

560 National Business Parkway
Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

120,000

 

N/A

 

$

31,000

 

$

5,772

 

 

 

2Q 13

 

2Q 14

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

420 National Business Parkway
Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

140,000

 

N/A

 

36,000

 

8,654

 

 

 

3Q 12

 

3Q 13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7800 Backlick Road (Patriot Ridge)
Springfield, Virginia

 

Springfield

 

Wholly owned

 

239,000

 

N/A

 

71,000

 

8,478

 

 

 

2Q 13

 

2Q 14

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

200 Sentry Gateway
San Antonio, Texas

 

San Antonio Northwest

 

Wholly owned

 

93,830

 

N/A

 

15,800

 

2,304

 

 

 

3Q 12

 

3Q 13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1200 Redstone Gateway (Building 2)
Huntsville, Alabama

 

Huntsville

 

Consolidated Joint Venture

 

120,000

 

N/A

 

24,500

 

919

 

 

 

4Q 12

 

4Q 13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7200 Redstone Gateway (Flex)
Huntsville, Alabama

 

Huntsville

 

Consolidated Joint Venture

 

63,000

 

N/A

 

7,700

 

107

 

 

 

3Q 12

 

3Q 13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Defense Information Technology

 

 

 

 

 

775,830

 

 

 

$

186,000

 

$

26,234

 

 

 

 

 

 

 

% of Total Drivers

 

 

 

 

 

76

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Under Development

 

 

 

 

 

1,025,830

 

 

 

$

242,000

 

$

40,454

 

 

 

 

 

 

 

 


(1) Cost includes land, construction, leasing costs and allocated portion of structured parking and other shared infrastructure, if applicable.  For properties previously operated prior to placing into redevelopment, 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.

 

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.

 

26



 

Office Property Construction Placed into Service in 2011 (1)

 

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rentable

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Square Feet

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Upon

 

Development Square Feet Placed into Service

 

 

 

 

 

 

 

Business Park/

 

 

 

Construction

 

 

 

Year 2011

 

 

 

As of June 30, 2011 (2)

 

Property and Location

 

Submarket

 

Ownership

 

Completion

 

Year 2010

 

1st Quarter

 

2nd Quarter

 

Total

 

Occupied %

 

Leased %

 

209 Research Boulevard

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aberdeen, Maryland

 

Harford County

 

Wholly owned

 

77,192

 

47,930

 

6,097

 

23,165

 

77,192

 

93

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

308 Sentinel Drive (308 NBP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

151,207

 

31,127

 

120,080

 

 

151,207

 

98

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Construction Placed Into Service

 

 

 

 

 

228,399

 

79,057

 

126,177

 

23,165

 

228,399

 

 

 

 

 

 


(1) Includes construction properties with space placed into service in 2011.

(2) Represents occupancy and leasing percentages of square feet placed into service.

 

27



 

Construction Leasing Trend Analysis Over Previous Five Quarters (1)

 

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rentable

 

Construction

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Square

 

Commencement

 

Cumulative Square Feet Leased as of

 

Property and Location

 

Submarket

 

Ownership

 

Feet

 

Date

 

6/30/2010

 

9/30/2010

 

12/31/2010

 

3/31/2011

 

6/30/2011

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

316 Sentinel Way (316 NBP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

125,150

 

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

 

89,295

 

4Q 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8000 Potranco Road

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

San Antonio, Texas

 

San Antonio Northwest

 

Wholly owned

 

125,157

 

1Q 09

 

125,157

 

125,157

 

125,157

 

125,157

 

125,157

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8030 Potranco Road

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

San Antonio, Texas

 

San Antonio Northwest

 

Wholly owned

 

125,155

 

1Q 09

 

125,155

 

125,155

 

125,155

 

125,155

 

125,155

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Government

 

 

 

 

 

589,875

 

 

 

375,430

 

375,430

 

375,430

 

375,430

 

375,430

 

 

 

 

 

 

 

 

 

 

 

64

%

64

%

64

%

64

%

64

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

300 Sentinel Drive (300 NBP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

193,296

 

1Q 08

 

155,930

 

155,930

 

166,872

 

190,529

 

190,529

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

308 Sentinel Drive (308 NBP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

151,207

 

3Q 09

 

27,956

 

148,482

 

148,482

 

148,482

 

151,207

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

410 National Business Parkway

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

109,538

 

4Q 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

430 National Business Parkway

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annapolis Junction, Maryland

 

BWI Airport

 

Wholly owned

 

109,407

 

3Q 10

 

 

 

 

 

60,726

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7770 Backlick Road (Patriot Ridge)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Springfield, Virginia

 

Springfield

 

Wholly owned

 

240,581

 

1Q 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

206 Research Boulevard

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aberdeen, Maryland

 

Harford County

 

Wholly owned

 

128,119

 

3Q 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

209 Research Boulevard

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aberdeen, Maryland

 

Harford County

 

Wholly owned

 

77,192

 

1Q 09

 

65,662

 

77,192

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10807 New Allegiance Drive

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Colorado Springs, Colorado

 

1-25 North Cooridor

 

Wholly owned

 

145,723

 

2Q 08

 

59,993

 

59,993

 

59,993

 

59,993

 

59,993

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

565 Space Center Drive (Patriot Park)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Colorado Springs, Colorado

 

Colorado Springs East

 

Wholly owned

 

89,899

 

2Q 08

 

1,949

 

1,949

 

1,949

 

1,949

 

1,949

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

45310 Abell House Lane (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

California, MD

 

St. Mary’s County

 

Wholly owned

 

82,842

 

4Q 10

 

82,842

 

82,842

 

82,842

 

82,842

 

82,842

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

100 Sentry Gateway

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

San Antonio, Texas

 

San Antonio Northwest

 

Wholly owned

 

94,961

 

1Q 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1000 Redstone Gateway

 

 

 

Consolidated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Huntsville, Alabama

 

Huntsville

 

Joint Venture

 

114,891

 

1Q 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal Defense Information Technology

 

 

 

1,617,229

 

 

 

421,883

 

553,939

 

564,881

 

588,538

 

651,989

 

 

 

 

 

 

 

 

 

 

 

26

%

34

%

35

%

36

%

40

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Construction Leasing

 

 

 

 

 

2,207,104

 

 

 

797,313

 

929,369

 

940,311

 

963,968

 

1,027,419

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Percent Leased

 

 

 

 

 

 

 

 

 

36

%

42

%

43

%

44

%

47

%

 


(1) Includes office properties not included in same office that were under active construction as of period end or for which construction was recently completed.

(2) We acquired this property in August 2010.

 

28



 

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 6/30/11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Power Loft @ Innovation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

9651 Hornbaker Road

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Manassas, Virginia

 

233,000

 

100,000

 

18

 

17

%

11

%

$

270,500

 

$

169,285

 

4Q 12

 

1Q 13

 

$

445

 

 

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.

 

29



 

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 June 30, 2011:

 

Shares

 

Units

 

Shares/Units

 

Total

 

% of Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Insiders

 

1,062,565

 

3,738,427

 

 

4,800,992

 

6.24

%

Non-insiders

 

70,829,066

 

643,255

 

610,014

 

72,082,335

 

93.76

%

 

 

71,891,631

 

4,381,682

 

610,014

 

76,883,327

 

100.00

%

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

COMMON EQUITY - End of Quarter

 

 

 

 

 

 

 

 

 

 

 

Common Shares

 

71,892

 

67,104

 

66,932

 

59,406

 

59,288

 

Common Units

 

4,382

 

4,386

 

4,403

 

4,446

 

4,456

 

Total

 

76,273

 

71,490

 

71,334

 

63,852

 

63,744

 

End of Quarter Common Share Price

 

$

31.11

 

$

36.14

 

$

34.95

 

$

37.31

 

$

37.76

 

Market Value of Common Shares/Units

 

$

2,372,863

 

$

2,583,646

 

$

2,493,134

 

$

2,382,318

 

$

2,406,973

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Shares Trading Volume

 

 

 

 

 

 

 

 

 

 

 

Average Daily Volume (Shares)

 

779

 

711

 

784

 

728

 

887

 

Average Daily Volume

 

$

26,322

 

$

25,009

 

$

27,910

 

$

27,241

 

$

35,095

 

As a Percentage of Weighted Average Common Shares

 

1.1

%

1.1

%

1.2

%

1.2

%

1.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Common Share Price Range (price per share)

 

 

 

 

 

 

 

 

 

 

 

Quarterly High

 

$

36.79

 

$

36.90

 

$

38.96

 

$

39.85

 

$

43.61

 

Quarterly Low

 

$

30.63

 

$

33.83

 

$

33.33

 

$

35.04

 

$

34.82

 

Quarterly Average

 

$

33.81

 

$

35.20

 

$

35.59

 

$

37.44

 

$

39.58

 

 

30



 

Quarterly Preferred Equity and Total Market Capitalization Analysis

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

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

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

 

2,372,863

 

2,583,646

 

2,493,134

 

2,382,318

 

2,406,973

 

Total Equity Market Capitalization

 

$

2,597,996

 

$

2,808,779

 

$

2,718,267

 

$

2,607,451

 

$

2,632,107

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Debt

 

$

2,299,416

 

$

2,396,795

 

$

2,323,681

 

$

2,468,419

 

$

2,182,375

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Market Capitalization

 

$

4,897,412

 

$

5,205,574

 

$

5,041,948

 

$

5,075,870

 

$

4,814,482

 

 

31



 

Dividend Analysis

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

6/30/11

 

6/30/10

 

Common Share Dividends

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends per share/unit

 

$

0.4125

 

$

0.4125

 

$

0.4125

 

$

0.4125

 

$

0.3925

 

$

0.8250

 

$

0.7850

 

Increase over prior period

 

0.0

%

0.0

%

0.0

%

5.1

%

0.0

%

5.1

%

5.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Dividend Payout Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted FFO Payout, as adjusted for comparability

 

75.8

%

79.2

%

61.7

%

71.3

%

73.2

%

77.4

%

74.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted AFFO Payout

 

121.9

%

142.4

%

95.0

%

89.3

%

92.6

%

131.1

%

95.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted AFFO Payout, as adjusted for recurring capital expenditures of properties included in Strategic Reallocation Plan

 

111.3

%

111.9

%

N/A

 

N/A

 

N/A

 

111.6

%

N/A

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividend Coverage - Diluted FFO, as adjusted for comparability

 

1.32x

 

1.26x

 

1.62x

 

1.40x

 

1.37x

 

1.29x

 

1.35x

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividend Coverage - Diluted AFFO

 

0.82x

 

0.70x

 

1.05x

 

1.12x

 

1.08x

 

0.76x

 

1.04x

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Dividend Yields

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividend Yield at Quarter End

 

5.30

%

4.57

%

4.72

%

4.42

%

4.16

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

32


 


 

Second Quarter 2011

 

Debt Analysis

(dollars in thousands)

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

 

 

 

 

Debt Outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage Loans

 

$

1,378,287

 

$

1,484,892

 

$

1,485,860

 

$

1,449,817

 

$

1,432,544

 

 

 

 

 

Construction Loans (1)

 

191,754

 

178,365

 

159,092

 

138,655

 

119,640

 

 

 

 

 

Unsecured Revolving Credit Facility (2)

 

342,000

 

348,000

 

295,000

 

498,000

 

250,000

 

 

 

 

 

Exchangeable Senior Notes

 

387,375

 

385,538

 

383,729

 

381,947

 

380,191

 

 

 

 

 

 

 

$

2,299,416

 

$

2,396,795

 

$

2,323,681

 

$

2,468,419

 

$

2,182,375

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Rate Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed-Mortgage Loans

 

$

1,068,364

 

$

1,174,656

 

$

1,175,305

 

$

1,179,060

 

$

1,161,652

 

 

 

 

 

Fixed-Exchangeable Senior Notes

 

387,375

 

385,538

 

383,729

 

381,947

 

380,191

 

 

 

 

 

Variable Rate Loans

 

434,101

 

426,849

 

504,712

 

687,412

 

420,532

 

 

 

 

 

Variable Rate Loans Subject to Interest Rate Swaps (3)

 

409,576

 

409,752

 

259,935

 

220,000

 

220,000

 

 

 

 

 

 

 

$

2,299,416

 

$

2,396,795

 

$

2,323,681

 

$

2,468,419

 

$

2,182,375

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

% of Fixed Rate Loans (3)

 

81.12

%

82.19

%

78.28

%

72.15

%

80.73

%

 

 

 

 

% of Variable Rate Loans (3)

 

18.88

%

17.81

%

21.72

%

27.85

%

19.27

%

 

 

 

 

 

 

100.00

%

100.00

%

100.00

%

100.00

%

100.00

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

6/30/2011

 

3/31/2011

 

12/31/2010

 

9/30/2010

 

6/30/2010

 

6/30/2011

 

6/30/2010

 

Average Contract Interest Rates

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage & Construction Loans

 

5.21

%

5.26

%

5.30

%

5.39

%

5.43

%

5.24

%

5.44

%

Unsecured Revolving Credit Facility (4)

 

2.13

%

2.18

%

2.07

%

2.19

%

2.53

%

2.15

%

2.15

%

Exchangeable Senior Notes (5)

 

3.95

%

3.95

%

3.95

%

3.95

%

3.95

%

3.95

%

3.83

%

Total Weighted Average

 

4.88

%

4.91

%

4.92

%

5.06

%

5.26

%

4.89

%

5.04

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI interest coverage ratio

 

3.20x

 

3.03x

 

3.24x

 

3.01x

 

3.05x

 

3.11x

 

3.08x

 

Adjusted EBITDA interest coverage ratio

 

3.10x

 

2.93x

 

3.36x

 

2.85x

 

2.85x

 

3.02x

 

2.90x

 

NOI debt service coverage ratio

 

2.77x

 

2.61x

 

2.81x

 

2.62x

 

2.64x

 

2.69x

 

2.65x

 

Adjusted EBITDA debt service coverage ratio

 

2.69x

 

2.52x

 

2.92x

 

2.49x

 

2.47x

 

2.61x

 

2.50x

 

NOI fixed charge coverage ratio

 

2.72x

 

2.57x

 

2.75x

 

2.55x

 

2.57x

 

2.64x

 

2.58x

 

Adjusted EBITDA fixed charge coverage ratio

 

2.63x

 

2.49x

 

2.86x

 

2.42x

 

2.41x

 

2.56x

 

2.44x

 

Debt to Adjusted EBITDA ratio (6)

 

7.87x

 

8.66x

 

7.29x

 

9.21x

 

8.36x

 

 

 

 

 

Adjusted debt to Adjusted EBITDA ratio (7)

 

6.39x

 

7.23x

 

6.08x

 

7.93x

 

7.14x

 

 

 

 

 

 


(1) Includes $175.0 million due under our Revolving Construction Facility at June 30, 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 June 30, 2011, our borrowing capacity under the Revolving Credit Facility was $800.0 million, of which $452.1 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.

 

33



 

Second Quarter 2011

 

Debt Maturity Schedule

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exchangeable

 

 

 

 

 

Non-Recourse Debt (1)

 

Recourse Debt (2)

 

Senior Notes (3)

 

 

 

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)

 

Balloon Payments
Due on Maturity

 

Total Scheduled
Payments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

July - September

 

$

3,113

 

$

 

N/A

 

$

257

 

$

 

N/A

 

$

342,000

 

$

162,500

 

$

507,870

 

October - December

 

3,186

 

 

N/A

 

258

 

$

 

N/A

 

 

 

3,444

 

Total 2011(4)

 

$

6,299

 

$

 

N/A

 

$

515

 

$

 

N/A

 

$

342,000

 

$

162,500

 

$

511,314

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2012(5)

 

12,802

 

257,523

 

 

 

1,065

 

191,754

 

 

 

 

 

463,144

 

2013

 

10,075

 

134,843

 

 

 

1,131

 

 

 

 

 

 

146,049

 

2014(6)

 

6,687

 

175,931

 

 

 

841

 

26,766

 

 

 

 

 

210,225

 

2015

 

5,209

 

135,734

 

 

 

529

 

19,000

 

 

 

 

240,000

 

400,472

 

2016

 

3,481

 

274,605

 

 

 

556

 

 

 

 

 

 

278,642

 

Thereafter

 

193

 

300,609

 

 

 

3,025

 

50

 

 

 

 

 

303,877

 

 

 

$

44,746

 

$

1,279,245

 

 

 

$

7,662

 

$

237,570

 

 

 

$

342,000

 

$

402,500

 

$

2,313,723

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net discount

 

(14,307

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Debt

 

$

2,299,416

 

 


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 June 30, 2011, our borrowing capacity under the Revolving Credit Facility was $800.0 million, of which $452.1 million was available.

(3)

3.5% Exchangeable Senior Notes totaling $162.5 million 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 totaling $240.0 million mature in April 2030 but are subject to a put by the holders in April 2015 and every five years thereafter.

(4)

Includes $342.0 million due under our Revolving Credit Facility at June 30, 2011 that may be extended by us for a one-year period, subject to certain conditions.

(5)

Includes $175.0 million due under our Revolving Construction Facility at June 30, 2011. This facility provides for borrowings of up to $225.0 million to finance construction of the Company’s wholly owned buildings.

(6)

We have $73.5 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.

 

34



 

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

%

$

27,927

 

$

16,753

 

50

%

 

 

 

 

 

 

 

 

 

 

 

 

Suburban Maryland:

 

 

 

 

 

 

 

 

 

 

 

4230 Forbes Boulevard

 

55,866

 

70.3

%

4,002

 

 

50

%

M Square - operating properties

 

 

 

 

 

54,707

 

39,576

 

50

%

5825 University Research Drive

 

118,620

 

74.8

%

 

 

 

 

 

 

5850 University Research Drive

 

123,449

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total/Average

 

441,758

 

58.9

%

$

86,636

 

$

56,329

 

 

 

NOI of Operating Properties for Three Months Ended June 30, 2011 (2)

 

$

1,325

 

 

 

 

 

 

 

 

 

NOI of Operating Properties for Six Months Ended June 30, 2011 (2)

 

$

2,839

 

 

 

 

 

 

 

 

 

 

 

 

Estimated

 

 

 

 

 

 

 

 

 

Developable

 

Total

 

Property-Level

 

% COPT

 

Non-operational Properties

 

Square Feet

 

Assets (1)

 

Debt

 

Owned

 

Baltimore/Washington Corridor:

 

 

 

 

 

 

 

 

 

7742-7874 Milestone Parkway

 

1,382,000

 

$

5,249

 

 

50

%

 

 

 

 

 

 

 

 

 

 

Suburban Maryland:

 

 

 

 

 

 

 

 

 

Indian Head Technology Center

 

 

 

 

 

 

 

 

 

Business Park

 

967,000

 

6,492

 

 

75

%

M Square Research Park

 

510,000

 

4,656

 

 

50

%

 

 

 

 

 

 

 

 

 

 

Huntsville, AL:

 

 

 

 

 

 

 

 

 

Redstone Gateway

 

4,600,000

 

30,065

 

 

85

%

Total

 

7,459,000

 

$

46,462

 

$

 

 

 

 


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

(2)   Represents gross NOI of the joint venture operating properties before allocation to joint venture partners.

 

35



 

Summary of Unconsolidated Joint Venture

(dollars in thousands)

 

 

 

Operational

 

 

 

Property and Location

 

Square Feet

 

Occupancy

 

Greater Harrisburg:

 

 

 

 

 

2605 Interstate Drive

 

79,456

 

100.0

%

2601 Market Place

 

65,411

 

90.0

%

6340 Flank Drive

 

68,200

 

100.0

%

6345 Flank Drive

 

69,443

 

63.0

%

6360 Flank Drive

 

46,589

 

39.1

%

6375 Flank Drive

 

19,783

 

71.3

%

6380 Flank Drive

 

32,668

 

80.6

%

6385 Flank Drive

 

32,932

 

89.4

%

6400 Flank Drive

 

52,439

 

26.5

%

6405 Flank Drive

 

32,000

 

0.0

%

75 Shannon Road

 

20,887

 

0.0

%

85 Shannon Road

 

12,863

 

100.0

%

95 Shannon Road

 

21,976

 

100.0

%

5035 Ritter Road

 

56,556

 

100.0

%

5070 Ritter Road - Building A

 

31,710

 

36.4

%

5070 Ritter Road - Building B

 

28,347

 

82.0

%

 

 

 

 

 

 

Total/Average

 

671,260

 

71.3

%

 

 

 

 

 

 

COPT Investment

 

$

(5,841

)

 

 

Total Assets

 

$

64,180

 

 

 

Property Level Debt

 

$

65,217

 

 

 

NOI of Operating Properties for Three Months Ended June 30, 2011 (1)

 

$

911

 

 

 

NOI of Operating Properties for Six Months Ended June 30, 2011 (1)

 

$

1,849

 

 

 

% COPT Owned

 

20

%

 

 

 


(1) Represents gross NOI of the joint venture operating properties before allocation to joint venture partners.

 

36



 

Supplementary Reconciliations of Non-GAAP Measures

(in thousands)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

6/30/11

 

6/30/10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income

 

$

(26,007

)

$

(18,566

)

$

16,752

 

$

8,926

 

$

9,151

 

$

(44,573

)

$

19,826

 

Interest expense on continuing and discontinued operations

 

26,830

 

26,928

 

26,878

 

26,626

 

25,921

 

53,758

 

48,624

 

Total income tax (benefit) expense

 

(5,042

)

(544

)

33

 

27

 

7

 

(5,586

)

59

 

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

 

623

 

625

 

642

 

652

 

632

 

1,248

 

1,282

 

Real estate-related depreciation and amortization

 

32,049

 

33,020

 

35,347

 

30,745

 

29,548

 

65,069

 

57,151

 

Impairment losses

 

44,605

 

27,742

 

 

 

 

72,347

 

 

Adjusted EBITDA

 

$

73,058

 

$

69,205

 

$

79,652

 

$

66,976

 

$

65,259

 

$

142,263

 

$

126,942

 

Add back:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

6,320

 

6,777

 

6,103

 

6,079

 

5,926

 

13,097

 

11,826

 

Business development

 

588

 

488

 

691

 

2,886

 

465

 

1,076

 

620

 

Depreciation of FF&E

 

(623

)

(625

)

(642

)

(652

)

(632

)

(1,248

)

(1,282

)

Income from construction contracts and other service operations

 

(1,188

)

(410

)

(483

)

(261

)

(663

)

(1,598

)

(1,629

)

Interest and other income

 

(2,756

)

(1,168

)

(7,626

)

(395

)

(245

)

(3,924

)

(1,547

)

Loss on early extinguishment of debt

 

25

 

 

 

 

 

25

 

 

Gain on sales of operating properties

 

(150

)

 

4

 

(784

)

 

(150

)

(297

)

Non-operational property sales

 

(16

)

(2,701

)

 

(2,477

)

(335

)

(2,717

)

(363

)

Equity in (income) loss of unconsolidated entities

 

94

 

(30

)

(1,005

)

(648

)

72

 

64

 

277

 

NOI

 

$

75,352

 

$

71,536

 

$

76,694

 

$

70,724

 

$

69,847

 

$

146,888

 

$

134,547

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Discontinued Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from real estate operations

 

$

2,263

 

$

2,283

 

$

3,566

 

$

3,052

 

$

3,262

 

$

4,546

 

$

6,627

 

Property operating expenses

 

(733

)

(1,195

)

(779

)

(889

)

(884

)

(1,928

)

(2,234

)

Depreciation and amortization

 

(609

)

(1,630

)

(1,337

)

(812

)

(828

)

(2,239

)

(1,620

)

Interest

 

(223

)

(289

)

(256

)

(351

)

(345

)

(512

)

(556

)

Impairment losses

 

(6,315

)

 

 

 

 

(6,315

)

 

Gain (loss) on sales of depreciated real estate properties

 

150

 

 

(4

)

784

 

 

150

 

297

 

Discontinued operations

 

$

(5,467

)

$

(831

)

$

1,190

 

$

1,784

 

$

1,205

 

$

(6,298

)

$

2,514

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

$

16

 

$

2,701

 

$

 

$

2,477

 

$

335

 

$

2,717

 

$

352

 

Add income taxes

 

 

 

 

 

 

 

11

 

Gain on sales of real estate from discontinued operations

 

150

 

 

(4

)

784

 

 

150

 

297

 

Gain on sales of real estate from continuing and discontinued operations

 

166

 

2,701

 

(4

)

3,261

 

335

 

2,867

 

660

 

Gain on sales of non-operating properties

 

(16

)

(2,701

)

 

(2,477

)

(335

)

(2,717

)

(363

)

Gain on sales of operating properties

 

$

150

 

$

 

$

(4

)

$

784

 

$

 

$

150

 

$

297

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Average Shares for period ended:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Shares Outstanding

 

68,446

 

66,340

 

63,404

 

58,656

 

58,489

 

67,399

 

58,169

 

Dilutive effect of share-based compensation awards

 

151

 

261

 

236

 

296

 

421

 

205

 

405

 

Common Units

 

4,382

 

4,396

 

4,412

 

4,453

 

4,558

 

4,389

 

4,786

 

Denominator for FFO per share - diluted

 

72,979

 

70,997

 

68,052

 

63,405

 

63,468

 

71,993

 

63,360

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Denominator for diluted EPS

 

72,828

 

70,736

 

63,640

 

58,952

 

58,910

 

71,788

 

58,574

 

Anti-dilutive EPS effect of share-based compensation awards

 

151

 

261

 

 

 

 

205

 

 

Weighted average common units

 

 

 

4,412

 

4,453

 

4,558

 

 

4,786

 

Denominator for diluted FFO per share

 

72,979

 

70,997

 

68,052

 

63,405

 

63,468

 

71,993

 

63,360

 

 

37



 

Supplementary Reconciliations of Non-GAAP Measures (continued)

(dollars in thousands)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

6/30/11

 

3/31/11

 

12/31/10

 

9/30/10

 

6/30/10

 

6/30/11

 

6/30/10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Assets or Denominator for Debt to Total Assets

 

$

3,868,230

 

$

3,865,809

 

$

3,844,517

 

$

3,737,372

 

$

3,467,283

 

 

 

 

 

Accumulated depreciation

 

534,407

 

526,825

 

503,032

 

479,218

 

464,408

 

 

 

 

 

Intangible assets on real estate acquisitions, net

 

99,917

 

106,444

 

113,735

 

123,307

 

96,151

 

 

 

 

 

Assets other than assets included in properties, net

 

(395,369

)

(397,038

)

(399,062

)

(388,222

)

(336,769

)

 

 

 

 

Denominator for Debt to Undepreciated Book Value of Real Estate Assets

 

$

4,107,185

 

$

4,102,040

 

$

4,062,222

 

$

3,951,675

 

$

3,691,073

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP revenues from real estate operations from continuing operations

 

$

118,543

 

$

120,158

 

$

120,147

 

$

111,976

 

$

106,729

 

$

238,701

 

$

216,360

 

Revenues from discontinued operations

 

2,263

 

2,283

 

3,566

 

3,052

 

3,262

 

4,546

 

6,627

 

Real estate revenues from continuing and discontinued operations

 

$

120,806

 

$

122,441

 

$

123,713

 

$

115,028

 

$

109,991

 

$

243,247

 

$

222,987

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP revenues from real estate operations from continuing operations

 

$

118,543

 

$

120,158

 

$

120,147

 

$

111,976

 

$

106,729

 

$

238,701

 

$

216,360

 

Property operating expenses

 

(44,721

)

(49,710

)

(46,240

)

(43,415

)

(39,260

)

(94,431

)

(86,206

)

Revenues from discontinued operations

 

2,263

 

2,283

 

3,566

 

3,052

 

3,262

 

4,546

 

6,627

 

Property operating expenses from discontinued operations

 

(733

)

(1,195

)

(779

)

(889

)

(884

)

(1,928

)

(2,234

)

NOI

 

$

75,352

 

$

71,536

 

$

76,694

 

$

70,724

 

$

69,847

 

$

146,888

 

$

134,547

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

$

31,440

 

$

31,390

 

$

34,010

 

$

29,933

 

$

28,720

 

$

62,830

 

$

55,531

 

Depreciation and amortization from discontinued operations

 

609

 

1,630

 

1,337

 

812

 

828

 

2,239

 

1,620

 

Real estate-related depreciation and amortization

 

$

32,049

 

$

33,020

 

$

35,347

 

$

30,745

 

$

29,548

 

$

65,069

 

$

57,151

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total tenant improvements and incentives on operating properties

 

$

11,116

 

$

13,270

 

$

8,761

 

$

7,789

 

$

4,630

 

$

24,386

 

$

8,701

 

Total capital improvements on operating properties

 

2,426

 

1,990

 

6,879

 

1,717

 

1,524

 

4,416

 

2,394

 

Total leasing costs for operating properties

 

3,388

 

2,736

 

4,573

 

2,004

 

1,350

 

6,124

 

2,688

 

Less: Nonrecurring tenant improvements and incentives on operating properties

 

(875

)

(2,448

)

(3,003

)

(1,067

)

(136

)

(3,323

)

(213

)

Less: Nonrecurring capital improvements on operating properties

 

(820

)

(610

)

(1,342

)

(171

)

(293

)

(1,430

)

(353

)

Less: Nonrecurring leasing costs for operating properties

 

(347

)

(616

)

10

 

(120

)

(3

)

(963

)

51

 

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

 

25

 

22

 

82

 

4

 

8

 

47

 

23

 

Recurring capital expenditures

 

$

14,913

 

$

14,344

 

$

15,960

 

$

10,156

 

$

7,080

 

$

29,257

 

$

13,291

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense from continuing operations

 

$

26,607

 

$

26,639

 

$

26,622

 

$

26,275

 

$

25,576

 

$

53,246

 

$

48,068

 

Interest expense from discontinued operations

 

223

 

289

 

256

 

351

 

345

 

512

 

556

 

Total interest expense

 

$

26,830

 

$

26,928

 

$

26,878

 

$

26,626

 

$

25,921

 

$

53,758

 

$

48,624

 

Less: Amortization of deferred financing costs

 

(1,702

)

(1,759

)

(1,696

)

(1,554

)

(1,495

)

(3,461

)

(2,621

)

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

 

(1,582

)

(1,558

)

(1,503

)

(1,541

)

(1,488

)

(3,140

)

(2,270

)

Denominator for interest coverage

 

$

23,546

 

$

23,611

 

$

23,679

 

$

23,531

 

$

22,938

 

$

47,157

 

$

43,733

 

Scheduled principal amortization

 

3,623

 

3,798

 

3,607

 

3,420

 

3,500

 

7,421

 

6,969

 

Denominator for debt service coverage

 

$

27,169

 

$

27,409

 

$

27,286

 

$

26,951

 

$

26,438

 

$

54,578

 

$

50,702

 

Scheduled principal amortization

 

(3,623

)

(3,798

)

(3,607

)

(3,420

)

(3,500

)

(7,421

)

(6,969

)

Preferred dividends - redeemable non-convertible

 

4,026

 

4,025

 

4,026

 

4,025

 

4,026

 

8,051

 

8,051

 

Preferred distributions

 

165

 

165

 

165

 

165

 

165

 

330

 

330

 

Denominator for fixed charge coverage

 

$

27,737

 

$

27,801

 

$

27,870

 

$

27,721

 

$

27,129

 

$

55,538

 

$

52,114

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Preferred dividends

 

$

4,026

 

$

4,025

 

$

4,026

 

$

4,025

 

$

4,026

 

$

8,051

 

$

8,051

 

Preferred distributions

 

165

 

165

 

165

 

165

 

165

 

330

 

330

 

Common distributions

 

1,808

 

1,809

 

1,816

 

1,834

 

1,749

 

3,617

 

3,616

 

Common dividends

 

29,632

 

27,704

 

27,597

 

24,494

 

23,259

 

57,336

 

46,419

 

Total dividends/distributions

 

$

35,631

 

$

33,703

 

$

33,604

 

$

30,518

 

$

29,199

 

$

69,334

 

$

58,416

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common share dividends

 

$

29,632

 

$

27,704

 

$

27,597

 

$

24,494

 

$

23,259

 

$

57,336

 

$

46,419

 

Common unit distributions

 

1,808

 

1,809

 

1,816

 

1,834

 

1,749

 

3,617

 

3,616

 

Dividends and distributions for payout ratios

 

$

31,440

 

$

29,513

 

$

29,413

 

$

26,328

 

$

25,008

 

$

60,953

 

$

50,035

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt, net

 

$

2,299,416

 

$

2,396,795

 

$

2,323,681

 

$

2,468,419

 

$

2,182,375

 

 

 

 

 

Less: Construction in progress on held for sale properties

 

(22,934

)

 

 

 

 

 

 

 

 

Less: Construction in progress

 

(407,674

)

(396,170

)

(386,195

)

(344,924

)

(319,846

)

 

 

 

 

Adjusted debt for adjusted debt to EBITDA ratio

 

$

1,868,808

 

$

2,000,625

 

$

1,937,486

 

$

2,123,495

 

$

1,862,529

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (benefit) tax expense from continuing operations

 

$

(5,042

)

$

(544

)

$

33

 

$

27

 

$

7

 

$

(5,586

)

$

48

 

Income tax expense from gain on other sales of real estate

 

 

 

 

 

 

 

11

 

Total income tax expense

 

$

(5,042

)

$

(544

)

$

33

 

$

27

 

$

7

 

$

(5,586

)

$

59

 

 

38



 

Definitions

Non-GAAP Measures

 

We believe that the measures defined below that are not determined in accordance with generally accepted accounting principles (“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 and 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, gain or loss on early extinguishment of debt and impairment losses, net of associated income tax.  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.

 

39



 

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, net of associated income tax, (d) operating property acquisition costs, (e) gain or loss on early extinguishment of debt and (f) 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 Strategic Reallocation Plan

 

Defined as Diluted AFFO adjusted to add back recurring capital expenditures of properties included in Strategic Reallocation Plan.  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.

 

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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.

 

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Same Office Properties — Operating office properties owned and 100% operational since January 1, 2010, excluding properties identified for disposition under our Strategic Reallocation Plan.

 

Strategic Reallocation Plan — Plan approved by our Board of Trustees on April 25, 2011 to dispose of properties that are no longer closely aligned with our strategy during the next three years.

 

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.

 

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