Corporate Office Properties Trust Acquires 362,000 Square Feet in Two Office Buildings for $119 Million
COLUMBIA, Md.--(BUSINESS WIRE)-- Corporate Office Properties Trust (COPT) (NYSE: OFC) announced today that it has entered a new submarket with the acquisition of two Class A office buildings containing 362,000 square feet known as Maritime Plaza I and II in the Capitol Riverfront submarket of Washington, DC. The buildings were built in 2001 and 2003. The purchase price of $119 million included the assumption of a $70.1 million mortgage loan with a fixed interest rate of 5.35% that matures in March 2014. The two buildings are subject to 99 year ground leases with Washington Gas Light Company that expire August 2099 and November 2100. The five and four-story office buildings are 100% leased. Over 50% of the space is leased to investment grade tenants, of which most are Super Core tenants, such as Computer Sciences Corporation, General Dynamics and SAIC.
Maritime Plaza I and II are located at 1201 M Street SE and 1220 12th Street SE and are adjacent to I-295 and the Washington Navy Yard, home to the Naval Sea Systems Command (NAVSEA). NAVSEA's 2008 budget was $25 billion. The office buildings are part of a planned five building mixed-use project known as Maritime Plaza. Maritime Plaza is well positioned to take advantage of future BRAC growth.
The Washington Navy Yard was a major beneficiary of the 1995 BRAC and by 2001 NAVSEA relocated approximately 4,000 employees to the Navy Yard. Most recently, the Navy announced its intent to hire close to another 1,000 employees by 2011 with an additional 2,400 employees by 2015, positioning Maritime Plaza well for future demand.
"This acquisition and expansion into a key submarket of Washington, DC fits well within our Super Core strategy of developing and acquiring properties leased primarily to the U.S. Government, Defense IT and Data sector tenants as well as locating adjacent to government demand drivers," stated Randall M. Griffin, Chief Executive Officer of Corporate Office Properties Trust. "This represents COPT's first acquisition in a DC submarket. This unique submarket is centered on defense contractor operations. These are excellent office buildings with great visibility and access in and out of DC via I-295," he added.
Company Information
Corporate Office Properties Trust (COPT) (NYSE: OFC) is a specialty office real estate investment trust (REIT) that focuses on strategic customer relationships and specialized tenant requirements in the U.S. Government, Defense Information Technology and Data sectors. The Company acquires, develops, manages and leases properties which are typically concentrated in large office parks primarily located adjacent to government demand drivers and/or in growth corridors. As of June 30, 2010, the Company owned 267 office and data properties totaling 20.6 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", "expect", "estimate" 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:
-- the Company's ability to borrow on favorable terms;
-- 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;
-- risk of real estate acquisition and development, 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 for properties or our views of market economic
conditions that could result in recognition of impairment losses;
-- our ability to satisfy and operate effectively under federal income tax
rules relating to real estate investment trusts and partnerships;
-- governmental actions and initiatives; and
-- environmental requirements.
The Company undertakes no obligation to update or supplement any forward-looking statements. For further information, please refer to the Company's filings with the Securities and Exchange Commission, particularly the section entitled "Risk Factors" in Item 1A of the Company's Annual Report on Form 10-K for the year ended December 31, 2009.
Source: Corporate Office Properties Trust (COPT)
Released September 28, 2010