First Potomac Realty Trust (FPO) 8-K First Potomac Realty Trust Reports First Quarter 2007 Results

Exhibit 99.2

First Quarter 2007 Supplemental Financial Report

Matters other than historical facts set forth within this Supplemental Financial Report are forward-looking statements within the meaning of the federal securities laws. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties and other factors that could materially affect actual results, performance or achievements. These factors include, without limitation, the ability to enter into new leases or renew leases on favorable terms, the financial condition of tenants, the uncertainties of acquisition activity, the cost and availability of financing, the effects of general and local economic and market conditions, regulatory changes and other risks and uncertainties detailed in the Company’s Annual Report on Form 10-K. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

Quarterly Supplemental Disclosure
March 31, 2007

Index to Supplemental Information

	Page
Company Information	2
Reconciliation of EBITDA to Net Income	3
Financial Measures	4
Net Operating Income (NOI) — Same Property Analysis	5
Consolidated Balance Sheets	6
Total Market Capitalization	7
Selected Operating Ratios	8
Debt Analysis	9
Debt Maturity Schedule	11
Description of Properties	12
Land and Properties Available for Development	14
Top Ten Tenants	15
Lease Expirations	16
Lease Expirations — Current and Next Four Quarters	17
Leasing History by Acquisition Quarter	18
Leasing Analysis	19
Portfolio by Size	20
Market Concentration	21
Portfolio Analysis	22
Maryland Region	23
Maryland Region — Lease Expirations	24
Northern Virginia Region	25
Northern Virginia Region — Lease Expirations	26
Southern Virginia Region	27
Southern Virginia Region — Lease Expirations	28
Management Statements	29

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Quarterly Supplemental Disclosure
March 31, 2007

Company Information

First Potomac Realty Trust is a self-managed, self-administered real estate investment trust that focuses on owning, developing and operating industrial and flex properties in the Washington, DC metropolitan area and other major markets in Virginia and Maryland. Our focus is acquiring properties that can benefit from our intensive property management and seeking to reposition these properties to increase their profitability and value.

Corporate Headquarters	7600 Wisconsin Avenue	Investor Relations	Tripp Sullivan
	11th Floor		Corporate Communications, Inc.
	Bethesda, MD 20814		(615) 254-3376
			tripp.sullivan@cci-ir.com
New York Stock Exchange			Barry H. Bass
			Chief Financial Officer
			(301) 986-9200
			bbass@first-potomac.com
Web Site	www.first-potomac.com

Note that figures are rounded to the nearest thousand throughout this document which may impact footing and/or crossfooting of subtotals and totals.

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Quarterly Supplemental Disclosure
March 31, 2007

RECONCILIATION OF EBITDA TO NET INCOME
(unaudited, in thousands)
(percentages are representative of total revenues)

	Three Months Ended
	March 31, 2007					December 31, 2006					September 30, 2006					June 30, 2006					March 31, 2006
OPERATING REVENUES
Rental	$	24,920		83.1	%	$	23,256		83.6	%	$	22,865		84.3	%	$	21,093		83.6	%	$	20,319		83.4	%
Tenant reimbursements and other		5,056		16.9	%		4,552		16.4	%		4,264		15.7	%		4,131		16.4	%		4,055		16.6	%
		29,976		100.0	%		27,808		100.0	%		27,129		100.0	%		25,224		100.0	%		24,374		100.0	%
PROPERTY EXPENSES
Property operating		6,558		21.9	%		5,541		19.9	%		5,536		20.4	%		4,413		17.5	%		4,702		19.3	%
Real estate taxes and insurance		2,634		8.8	%		2,448		8.8	%		2,257		8.3	%		2,149		8.5	%		2,172		8.9	%
NET OPERATING INCOME	$	20,784		69.3	%	$	19,819		71.3	%	$	19,336		71.3	%	$	18,662		74.0	%	$	17,500		71.8	%
OTHER INCOME (EXPENSE)
General and administrative		(2,966	)	9.9	%		(2,332	)	8.4	%		(2,436	)	9.0	%		(2,530	)	10.0	%		(2,534	)	10.4	%
Interest and other income		194		0.6	%		289		1.0	%		175		0.6	%		165		0.7	%		403		1.7	%
EBITDA		18,012		60.1	%		17,776		63.9	%		17,075		62.9	%		16,297		64.6	%		15,369		63.1	%
Depreciation and amortization		(9,948	)				(9,542	)				(9,174	)				(7,957	)				(7,863	)
Interest expense		(8,289	)				(7,502	)				(7,155	)				(7,253	)				(6,590	)
Loss on interest-rate lock agreement		—					—					—					(671	)				—
Loss on early retirement of debt		—					—					—					(121	)				—
Income (loss) from continuing operations before minority interests		(225	)				732					746					295					916
Minority interests		5					(28	)				(28	)				(15	)				(52	)
Income (loss) from continuing operations		(220	)				704					718					280					864
DISCONTINUED OPERATIONS
Income from operations of disposed property		—					—					—					116					259
Gain on sale of disposed property		—					—					—					7,475					—
Minority interests in discontinued operations		—					—					—					(370	)				(15	)
Income from discontinued operations		—					—					—					7,221					244
NET INCOME (LOSS)	$	(220	)			$	704				$	718				$	7,501				$	1,108

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Quarterly Supplemental Disclosure
March 31, 2007

FINANCIAL MEASURES
(unaudited, in thousands, except per share data)

	Three Months Ended
	March 31, 2007			December 31, 2006			September 30, 2006			June 30, 2006			March 31, 2006
FUNDS FROM OPERATIONS (“FFO”)
Net income (loss)	$	(220	)	$	704		$	718		$	7,501		$	1,108
Add back:
Depreciation & amortization of real estate assets1		9,948			9,542			9,174			7,957			7,863
Depreciation & amortization related to discontinued operations		—			—			—			—			3
Minority interest		(5	)		28			28			385			67
Deduct:
Gain on sale of asset		—			—			—			(7,475	)		—
FFO	$	9,723		$	10,274		$	9,920		$	8,368		$	9,041
Charges:
Accelerated restricted share charges		—			—			246			178			—
Debt retirement charges		—			—			—			121			—
Loss on interest-rate lock agreement		—			—			—			671			—
FFO before charges	$	9,723		$	10,274		$	10,166		$	9,338		$	9,041
ADJUSTED FUNDS FROM OPERATIONS (“AFFO”)
FFO before charges	$	9,723		$	10,274		$	10,166		$	9,338		$	9,041
Non-cash stock-based compensation		314			293			338			123			460
Straight-line rent, net2		(263	)		(213	)		(283	)		(398	)		(328	)
Deferred market rent		(434	)		(446	)		(676	)		(486	)		(546	)
Non real-estate depreciation1		198			142			107			108			57
Debt fair value amortization		(755	)		(798	)		(760	)		(677	)		(652	)
Amortization of finance costs		260			257			203			244			209
Amortization of discounts		141			47			—			—			—
Tenant improvements3		(732	)		(636	)		(202	)		(324	)		(379	)
Leasing commissions3		(859	)		(353	)		(290	)		(392	)		(337	)
Capital expenditures3		(620	)		(1,073	)		(901	)		(655	)		(552	)
AFFO	$	6,973		$	7,494		$	7,702		$	6,881		$	6,973
Total weighted average shares and OP units
Basic		24,847			24,947			24,163			21,451			21,440
Diluted		25,093			25,207			24,446			21,661			21,675
FFO per share:
FFO per share and unit — basic and diluted	$	0.39		$	0.41		$	0.41		$	0.39		$	0.42
FFO per share and unit — diluted before charges	$	0.39		$	0.41		$	0.42		$	0.43		$	0.42
FPO per share and unit — diluted before charges, plus gain on sale	$	0.39		$	0.41		$	0.42		$	0.78		$	0.42
AFFO per share:
AFFO per share and unit — basic	$	0.28		$	0.30		$	0.32		$	0.32		$	0.33
AFFO per share and unit — diluted	$	0.28		$	0.30		$	0.32		$	0.32		$	0.32

1	Non-real estate depreciation is classified in general and administrative expense.
2	Straight-line rent is net of rent abatement and write-off of uncollectible accounts.
3	The following first-generation and development costs have been excluded from the calculation of AFFO:

Tenant improvements	$	528	$	639	$	100	$	625	$	97
Leasing commissions		137		127		156		131		63
Capital expenditures		1,140		1,072		2,134		208		348
Development		2,766		2,866		1,633		392		138
	$	4,571	$	4,704	$	4,023	$	1,356	$	646

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Quarterly Supplemental Disclosure
March 31, 2007

NET OPERATING INCOME (NOI)
SAME-PROPERTY ANALYSIS
(unaudited, in thousands)

	Three Months Ended March 31,
	2007			2006
Total base rent	$	19,357		$	19,228
Tenant reimbursement		3,949			3,718
Other		(69	)		163
Property operating expenses		(5,299	)		(4,552	)
Real estate taxes and insurance		(1,981	)		(2,041	)
Same-property1NOI — accrual basis		15,957			16,516
Straight-line revenue, net		(128	)		(290	)
Deferred market rental revenue		(326	)		(505	)
Same-property NOI — cash basis	$	15,503		$	15,721
Change in same-property NOI — accrual basis		-3.4	%
Change in same-property NOI — cash basis		-1.4	%
Components of Same Property NOI Change — accrual basis
Rental revenue increase	$	324
Tenant reimbursement		231
Other decrease		(232	)
Occupancy decrease		(195	)
Expense increase		(687	)
	$	(559	)
Same property percentage of total portfolio (sf)		75.0	%		90.0	%
Analysis of Same Property NOI:
Total revenue	$	29,976		$	24,374
Property operating expenses		6,558			4,702
Real estate taxes and insurance		2,634			2,172
NOI		20,784			17,500
Less: Non-same property NOI		(4,827	)		(984	)
Same-property1NOI — accrual basis		15,957			16,516
Straight-line revenue, net		(128	)		(290	)
Deferred market rental revenue		(326	)		(505	)
Same-property NOI — cash basis	$	15,503		$	15,721
Change in same-property NOI — accrual basis		-3.4	%
Change in same-property NOI — cash basis		-1.4	%

¹ Same-property comparisons are based upon those properties owned for the entirety of the quarterly periods presented. Same property results exclude the results of the following non-same properties: 6600 Business Parkway, River’s Bend Center, Northridge I & II, Crossways I, Sterling Park Business Center, 1408 Stephanie Way, Airpark Business Center, Chesterfield Business Center, Hanover Business Center, Gateway 270 West, Davis Drive, Indian Creek Court, Gateway II, Owings Mill Commerce Center, Park Central, Greenbrier Circle Corporate Center, Greenbrier Technology Center I, Pine Glen and Ammendale Commerce Center.

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Quarterly Supplemental Disclosure
March 31, 2007

CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)

	March 31, 2007			December 31, 2006
	(unaudited)
Assets
Rental property, net	$	931,074		$	884,882
Cash and cash equivalents		5,412			41,367
Escrows and reserves		12,576			11,139
Accounts and other receivables, net		4,013			4,212
Accrued straight-line rents, net		5,450			4,973
Deferred costs, net		9,527			9,006
Prepaid expenses and other assets		6,771			6,191
Intangible assets, net		33,527			32,797
Total assets	$	1,008,350		$	994,567
Liabilities
Mortgage loans	$	389,336		$	391,393
Exchangeable senior notes, net of discount		122,375			122,234
Senior notes		75,000			75,000
Unsecured revolving credit facility		27,000			—
Accounts payable and accrued expenses		7,882			8,898
Accrued interest		5,020			2,420
Rents received in advance		3,801			3,196
Tenant security deposits		5,238			4,965
Deferred market rent		8,645			8,883
Total liabilities		644,297			616,989
Minority interest		11,028			13,992
Shareholders’ equity
Common shares, $0.001 par value, 100,000,000 common shares authorized; 24,127,824 and 24,126,886 shares issued and outstanding, respectively		24			24
Additional paid-in capital		428,132			430,271
Dividends in excess of accumulated earnings		(75,131	)		(66,709	)
Total shareholders’ equity		353,025			363,586
Total liabilities and shareholders’ equity	$	1,008,350		$	994,567

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Quarterly Supplemental Disclosure
March 31, 2007

TOTAL MARKET CAPITALIZATION
(unaudited, in thousands)

			Percent of
			Total Market
			Capitalization
Total common shares outstanding		24,128
Operating Partnership (“OP”) units held by third parties		763
Total common shares and OP units		24,891
Market price at March 31, 2007	$	28.57
Total equity capitalization	$	711,136		53.7	%
Debt capitalization
Fixed-rate debt	$	586,711		44.3	%
Floating-rate debt		27,000		2.0	%
Total debt capitalization	$	613,711		46.3	%
Total market capitalization	$	1,324,847		100.0	%

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Quarterly Supplemental Disclosure
March 31, 2007

SELECTED OPERATING RATIOS
(unaudited, in thousands)

	Three Months Ended
	March 31, 2007			December 31, 2006			September 30, 2006			June 30, 2006			March 31, 2006
COVERAGE RATIO
Interest Coverage Ratio
EBITDA	$	18,012		$	17,776		$	17,075		$	16,297		$	15,369
Divided by Interest Expense		8,289			7,502			7,155			7,253			6,590
		2.17x			2.37x			2.39x			2.25x			2.33x
OVERHEAD RATIO
G&A to Real Estate Revenues
General and Administrative Expense	$	2,966		$	2,332		$	2,436		$	2,530		$	2,534
Real Estate Revenues		29,976			27,808			27,129			25,224			24,374
		9.9	%		8.4	%		9.0	%		10.0	%		10.4	%
LEVERAGE RATIO
Debt/Total Market Capitalization
Total Debt	$	613,711		$	588,627		$	493,750		$	509,390		$	485,651
Total Market Capitalization		1,324,847			1,318,356			1,250,701			1,152,079			1,092,772
		46.3	%		44.6	%		39.5	%		44.2	%		44.4	%

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Quarterly Supplemental Disclosure
March 31, 2007

DEBT ANALYSIS
(unaudited, in thousands)

				Principal				Effective
	Effective			Balance March		Annualized		Maturity		Balance at
Encumbered Properties	Interest Rate			31, 2007		Debt Service		Date		Maturity
Fixed Rate Debt
Herndon Corporate Center1		5.66	%	$	8,626	$	603		4/1/2008	$	8,549
Norfolk Commerce Park II1		5.28	%		7,389		648		8/7/2008		7,034
Deer Park Center1
6900 English Muffin Way1
Gateway Center1
Gateway West1
4451 Georgia Pacific1
20270 Goldenrod Lane1
15 Worman’s Mills Court1
Girard Business Center1		5.54	%		75,279		6,434		9/11/2008		71,825
Girard Place1
Old Courthouse Square1
Patrick Center1
7561 Lindbergh Drive1
West Park1
Woodlands Business Center1
Glenn Dale Business Center1		5.13	%		8,743		780		5/1/2009		8,033
4200 Tech Court		8.07	%		1,769		168		10/1/2009		1,705
Park Central I1		5.66	%		5,160		519		11/1/2009		4,523
4212 Tech Court		8.53	%		1,725		169		6/1/2010		1,654
Park Central II1		5.66	%		6,406		638		11/1/2010		5,289
Enterprise Center1		5.20	%		19,250		1,647		12/1/2010		16,712
Indian Creek Court1		5.90	%		13,468		1,162		1/1/2011		11,982
403 and 405 Glenn Drive1		5.50	%		8,975		746		7/1/2011		7,807
4612 Navistar Drive1		5.20	%		13,877		1,131		7/11/2011		11,921
Campus at Metro Park North1		5.25	%		25,422		2,028		2/11/2012		21,581
1434 Crossways Boulevard Building II1		5.38	%		10,774		826		8/5/2012		8,866
Crossways Commerce Center		6.70	%		25,636		2,087		10/1/2012		23,313
Newington Business Park Center		6.70	%		16,171		1,316		10/1/2012		14,706
Prosperity Business Center1		5.75	%		3,940		332		1/1/2013		3,242
Aquia Commerce Center I1		7.28	%		805		165		2/1/2013		42
1434 Crossways Boulevard Building I1		5.38	%		9,166		665		3/5/2013		7,597
Linden Business Center1		5.58	%		7,611		559		10/1/2013		6,596
Owings Mills Business Center1		5.75	%		5,807		425		3/1/2014		5,066
Plaza 500
Van Buren Business Park
Rumsey Center
Snowden Center		5.19	%		100,000		5,190		8/1/2015		100,000
Greenbrier Technology Center II
Norfolk Business Center
Alexandria Corporate Park
Hanover Business Center
Hanover Building D1		6.63	%		1,032		161		8/1/2015		13
Hanover Building B1		8.00	%		1,923		154		6/15/2016		1,911
Hanover Building C1		6.63	%		1,430		161		12/1/2017		13
Chesterfield Business Center
Chesterfield Buildings C, D, G and H1		6.63	%		2,681		414		8/1/2015		34
Chesterfield Buildings A, B, E and F1		6.63	%		2,924		318		6/1/2021		26
Gateway Centre (Building I)1		5.88	%		1,752		239		11/1/2016		—
Airpark Business Center1		6.63	%		1,595		173		6/1/2021		14
				$	389,336	$	29,858			$	350,054
Convertible Debt
Exchangeable Senior Notes2		4.45	%	$	122,375	$	5,000		12/15/2011	$	125,000
Senior Unsecured Debt
Series A Notes		6.41	%	$	37,500	$	2,404		6/15/2013	$	37,500
Series B Notes		6.55	%		37,500		2,456		6/15/2016		37,500
				$	75,000	$	4,860			$	75,000
Total Fixed Rate Debt				$	586,711	$	39,718			$	550,054

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Quarterly Supplemental Disclosure
March 31, 2007

DEBT ANALYSIS CONTINUED
(unaudited, in thousands)

		Principal				Effective
	Effective	Balance March		Annualized		Maturity	Balance at
	Interest Rate	31, 2007		Debt Service		Date3	Maturity
Floating Rate Debt
Credit Facility4	LIBOR + 1.20%		27,000		1,760	4/26/2009		27,000
Total at March 31, 2007			$613,711		$41,478			$577,054

¹ The balance includes the fair value impacts recorded at acquisition upon assumption of the mortgages encumbering these properties. The fair value impacts at March 31, 2007 and actual interest rates are:

				Contractual
Property	Fair Value			Interest Rate
Herndon Corporate Center	$	(59	)		5.11	%
Deer Park through Woodlands Business Center		1,286			6.71	%
Norfolk Commerce Park II		149			6.90	%
4612 Navistar Drive		1,126			7.48	%
Campus at Metro Park North		1,902			7.11	%
Enterprise Center		1,643			8.03	%
Glenn Dale Business Center		441			7.83	%
Gateway Centre (Building I)		101			7.35	%
1434 Crossways Boulevard Building I		630			6.25	%
1434 Crossways Boulevard Building II		1,014			7.05	%
403 and 405 Glenn Drive		650			7.60	%
Linden Business Center		169			6.01	%
Owings Mills Business Center		32			5.85	%
Prosperity Business Center		72			6.25	%
Airpark Business Center		76			7.45	%
Hanover Building B		(1	)		4.00	%
Hanover Building C		80			7.88	%
Hanover Building D		83			8.88	%
Chesterfield Buildings A, B, E and F		138			7.45	%
Chesterfield Buildings C, D, G and H		182			8.50	%
Indian Creek Court		799			7.80	%
Park Central I		262			8.00	%
Park Central II		494			8.32	%
Total fair value impact	$	11,269

     The mortgage assumed upon acquisition of Aquia Commerce Center I approximated its market value.

2	The notes were issued on December 11, 2006 at a $2.8 million discount.
3	On April 4, 2007, the Company entered into a first amendment to its unsecured revolving credit facility, which extends the maturity of the facility by one year to April 26, 2010.
4	As of March 31, 2007, the borrowing base for the unsecured revolving credit facility included the following properties: 13129 Airpark Road, Virginia Center, Aquia Commerce Center II, Airpark Place, 15395 John Marshall Highway, Gateway West II, Crossways II, Windsor at Battlefield, Reston Business Campus, 1400 Cavalier Boulevard, Gateway Centre (Building II), 2000 Gateway Boulevard, Diamond Hill Distribution Center, Linden Business Center (Building I), 1000 Lucas Way, River’s Bend Center, Northridge I & II, Crossways I, Sterling Park Business Center, Sterling Park Land, 1408 Stephanie Way, Davis Drive, Gateway 270 West and Interstate Plaza.

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Quarterly Supplemental Disclosure
March 31, 2007

DEBT MATURITY SCHEDULE

¹ On April 4, 2007, the Company extended the maturity of its Floating Rate Debt to April 26, 2010.

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Quarterly Supplemental Disclosure
March 31, 2007

DESCRIPTION OF PROPERTIES

							Annualized		Leased at			Occupied
			Year of		Square		Cash Basis		March			at March
Property	Property Type1,2	Location	Acquisition		Footage		Rent3		31, 2007			31, 2007
Plaza 500	MTI	Alexandria, VA		1997		507,602	$	5,387,025		98.5	%		98.5	%
Van Buren Business Park	Flex	Herndon, VA		1997		109,310		1,509,397		90.2	%		90.2	%
13129 Airpark Road	MTI	Culpeper, VA		1997		149,795		820,436		100.0	%		75.9	%
4200 & 4212 Tech Court	Flex	Chantilly, VA		1998		64,064		469,512		77.0	%		77.0	%
Newington Business Park Center	MTI	Lorton, VA		1999		254,242		2,299,637		91.1	%		91.1	%
Crossways Commerce Center I	MTI	Chesapeake, VA		1999		348,615		1,883,080		95.5	%		95.5	%
Crossways Commerce Center ll	Flex	Chesapeake, VA		1999		147,736		1,522,206		100.0	%		100.0	%
Coast Guard Building	Flex	Chesapeake, VA		1999		61,992		765,339		100.0	%		100.0	%
Snowden Center	Flex	Columbia, MD		2002		140,186		1,883,899		89.8	%		89.8	%
Rumsey Center	Flex	Columbia, MD		2002		134,356		1,254,811		83.6	%		83.6	%
Greenbrier Technology Center II	Flex	Chesapeake, VA		2002		79,684		667,671		99.0	%		99.0	%
Norfolk Business Center	Flex	Norfolk, VA		2002		90,682		807,178		97.6	%		97.6	%
Virginia Center	Flex	Glen Allen, VA		2003		118,884		1,315,195		95.9	%		92.6	%
Interstate Plaza	STI	Alexandria, VA		2003		107,320		1,025,714		100.0	%		100.0	%
Alexandria Corporate Park	MTI	Alexandria, VA		2003		278,130		3,889,560		84.2	%		84.2	%
Herndon Corporate Center	Flex	Herndon, VA		2004		127,088		2,173,139		98.6	%		98.6	%
Aquia Commerce Center I & II	Flex	Stafford, VA		2004		64,488		879,439		100.0	%		100.0	%
Deer Park	Flex	Randallstown, MD		2004		171,140		1,063,295		79.3	%		79.3	%
Gateway Center	Flex	Gaithersburg, MD		2004		44,307		618,002		100.0	%		100.0	%
Gateway West I & II	Flex	Westminster, MD		2004		110,107		944,982		79.7	%		79.7	%
Girard Business Center	Flex	Gaithersburg, MD		2004		123,900		825,456		66.1	%		66.1	%
Girard Place	Flex	Gaithersburg, MD		2004		175,217		1,463,876		100.0	%		100.0	%
15 Worman’s Mill Court	Flex	Frederick, MD		2004		39,966		378,047		100.0	%		100.0	%
20270 Goldenrod Lane	Flex	Germantown, MD		2004		24,468		272,697		96.1	%		96.1	%
6900 English Muffin Way	MTI	Frederick, MD		2004		165,690		1,163,845		100.0	%		100.0	%
4451 Georgia Pacific Boulevard	MTI	Frederick, MD		2004		169,750		1,184,943		100.0	%		100.0	%
7561 Lindbergh Drive	STI	Gaithersburg, MD		2004		36,000		309,450		100.0	%		100.0	%
Patrick Center	Office	Frederick, MD		2004		66,659		1,098,906		90.8	%		87.0	%
West Park	Office	Frederick, MD		2004		28,950		296,913		87.9	%		87.9	%
Woodlands Business Center	Office	Largo, MD		2004		37,940		405,120		79.7	%		79.7	%
Old Courthouse Square	Retail	Martinsburg, WV		2004		201,350		1,227,074		96.6	%		96.6	%
Airpark Place	Flex	Gaithersburg, MD		2004		82,178		787,071		75.1	%		75.1	%
15395 John Marshall Highway	STI	Haymarket, VA		2004		123,777		1,182,070		100.0	%		100.0	%
Norfolk Commerce Park II	Flex	Norfolk, VA		2004		128,147		978,935		74.2	%		74.2	%
Crossways II	Flex	Chesapeake, VA		2004		85,004		995,696		100.0	%		100.0	%
Windsor at Battlefield	Flex	Manassas, VA		2004		154,226		1,519,398		83.1	%		83.1	%
Campus at Metro Park North	Flex	Rockville, MD		2004		190,238		3,804,993		100.0	%		100.0	%
4612 Navistar Drive	STI	Frederick, MD		2004		215,085		1,816,655		100.0	%		100.0	%
Reston Business Campus	Flex	Reston, VA		2005		82,469		1,091,922		94.0	%		92.2	%
Enterprise Center	Flex	Chantilly, VA		2005		188,941		2,561,318		81.9	%		81.9	%
1400 Cavalier Boulevard	MTI	Chesapeake, VA		2005		299,963		1,219,029		100.0	%		100.0	%
Glenn Dale Business Center	MTI	Glenn Dale, MD		2005		315,191		1,753,479		99.2	%		99.2	%
Gateway Centre	MTI	Manassas, VA		2005		99,607		910,930		86.1	%		86.1	%
1434 Crossways Boulevard	Office	Chesapeake, VA		2005		220,501		2,576,291		100.0	%		100.0	%
Enterprise Parkway4	Flex	Hampton, VA		2005		421,100		512,414		10.0	%		0.5	%
403/405 Glenn Drive	MTI	Sterling, VA		2005		197,201		1,159,567		80.9	%		80.9	%
Diamond Hill Distribution Center	MTI	Chesapeake, VA		2005		712,550		3,076,358		99.8	%		99.8	%
Linden Business Center	Office	Manassas, VA		2005		108,237		1,257,933		81.8	%		81.8	%
Owings Mills Business Center	Office	Owings Mills, MD		2005		87,148		937,519		97.6	%		97.6	%
Prosperity Business Center	Flex	Merrifield, VA		2005		71,572		742,820		92.5	%		92.5	%
1000 Lucas Way	Office	Hampton, VA		2005		182,175		1,111,025		91.5	%		91.5	%
River’s Bend Center	MTI	Chester, VA		2006		492,200		2,945,150		93.2	%		84.0	%
Northridge I, II	MTI	Ashland, VA		2006		140,390		768,450		100.0	%		100.0	%
Crossways I	Flex	Chesapeake, VA		2006		143,398		1,526,322		85.1	%		85.1	%
Sterling Park Business Center	Flex	Sterling, VA		2006		127,859		1,513,828		96.9	%		83.2	%
1408 Stephanie Way	Flex	Chesapeake, VA		2006		51,209		314,080		64.6	%		64.6	%
Airpark Business Center	Flex	Richmond, VA		2006		42,142		270,566		83.6	%		62.4	%
Chesterfield Business Center	Flex	Richmond, VA		2006		189,871		1,234,758		99.3	%		95.2	%
Hanover Business Center	Flex	Ashland, VA		2006		183,069		1,084,753		97.5	%		97.5	%
Gateway 270 West	Flex	Clarksburg, MD		2006		255,460		1,947,570		59.9	%		57.0	%
Davis Drive	Flex	Sterling, VA		2006		52,581		312,200		70.7	%		70.7	%
Indian Creek Court	MTI	Beltsville, MD		2006		185,496		1,866,791		84.2	%		84.2	%
Gateway II	Flex	Norfolk, VA		2006		42,429		288,976		85.9	%		85.9	%
Owings Mills Commerce Center	Flex	Owings Mills, MD		2006		132,765		1,081,562		82.9	%		82.9	%
Park Central	Flex	Richmond, VA		2006		204,280		1,710,310		78.1	%		78.1	%
		Subtotal				10,388,077	$	86,666,583		88.5	%		86.9	%

1	MTI = Multi-tenant industrial
2	STI = Single-tenant industrial
3	Annualized cash rents have been normalized to reflect triple-net equivalent.
4	Formerly 2000 Gateway Boulevard

-12-

Quarterly Supplemental Disclosure
March 31, 2007

DESCRIPTION OF PROPERTIES CONTINUED

							Annualized		Leased at			Occupied
			Year of		Square		Cash Basis		March 31,			at March
Property	Property Type	Location	Acquisition		Footage		Rent1		2007			31, 2007
1Q 2007 Acquisitions
Greenbrier Circle Corporate Center	Flex	Chesapeake, VA		2007		229,163	$	2,298,157		95.7	%		95.7	%
Greenbrier Technology Center I	Flex	Chesapeake, VA		2007		95,843		836,124		82.6	%		82.6	%
Pine Glen	Flex	Richmond, VA		2007		86,720		442,637		100.0	%		100.0	%
Ammendale Commerce Center2	Flex	Beltsville, MD		2007		53,611		457,412		100.0	%		100.0	%
						465,337	$	4,034,330		94.3	%		94.3	%
			Total			10,853,414	$	90,700,913		88.8	%		87.2	%

Estimated Occupancy Schedule

Estimated Move-In	Square Footage		Annualized Rent
2007-Q23		233,848	$	2,291,842
2007-Q3		49,345		682,228
Total		283,193	$	2,974,070

1	Annualized cash rents have been normalized to reflect triple-net equivalent.
2	Excludes a vacant building, which was taken out of service upon acquisition. The 75,747 square-foot building is curently being re-developed.
3	Includes 15395 John Marshall Highway expansion.

-13-

Quarterly Supplemental Disclosure
March 31, 2007

LAND AND PROPERTIES AVAILABLE FOR DEVELOPMENT OR REDEVELOPMENT

	Developable		Square Feet
	Building		Under Development
	Square Feet		/Redevelopment
Sterling Park Business Center		400,000		100,000
Glenn Dale Business Center		200,000		—
Plaza 500		200,000		—
1400 Cavalier Boulevard		96,000		96,000
4612 Navistar Drive		50,000		—
Linden Business Center		30,000		—
15395 John Marshall Highway1		112,000		112,000
Crossways Commerce Center I		30,000		30,000
Snowden Center		4,500		4,500
Ammendale Business Center2		76,000		76,000
		1,198,500		418,500

1	The addition was completed and placed in service on 04/01/07.
2	Redevelopment of existing structure.

-14-

Quarterly Supplemental Disclosure
March 31, 2007

TOP TEN TENANTS

								Percentage
								of Total			Weighted
								Annualized			Average
				Total				Rental			Remaining
		Number		Leased		Total Annualized		Revenue -			Lease
Ranking	Tenant	of Leases		Square Feet		Rental Revenue1		Cash Basis			Years
1	U.S. Government		28		731,055	$	7,909,507		8.7	%		3.5
2	EDS		2		220,501		2,576,291		2.8	%		4.2
3	FKI Logistex		1		215,085		1,816,655		2.0	%		9.5
4	Sentara Healthcare		5		145,019		1,352,162		1.5	%		6.0
5	Verizon Virginia, Inc		6		92,829		1,301,762		1.4	%		5.3
6	Lockheed Martin Corporation		6		107,562		1,299,143		1.4	%		4.8
7	TDS Logistics, Inc		3		248,050		1,265,238		1.4	%		1.1
8	First Data Corporation		1		117,336		1,238,622		1.4	%		1.7
9	CACI		6		76,472		1,205,142		1.3	%		3.8
10	Engineering Solutions		1		123,777		1,182,070		1.3	%		5.5
	Subtotal Top 10 Tenants		59		2,077,686		21,146,592		23.2	%		4.3
	All Remaining Tenants		724		7,557,346		69,554,321		76.8	%		3.5
	Total / Weighted Average		783		9,635,032	$	90,700,913		100.0	%		3.5

¹ Annualized rental revenue is based on triple-net equivalent rental revenue as of March 31, 2007.

Tenant NAICS Classification by Total Annualized Rental Revenue

-15-

Quarterly Supplemental Disclosure
March 31, 2007

LEASE EXPIRATIONS

			Gross Leased Area					Annualized Cash Rental Revenue
													Average
	Number of												Base
	Leases		Square		Percent					Percent of			Rent1
Year of Lease Expiration	Expiring		Footage		of Total			Amount		Total			per Sq. Ft.
MTM		12		59,461		0.6	%	$	565,224		0.6	%	$	9.51
2007		128		1,249,677		13.0	%		11,181,944		12.3	%		8.95
2008		144		1,450,556		15.1	%		13,232,183		14.6	%		9.12
2009		150		1,700,103		17.6	%		15,168,242		16.7	%		8.92
2010		114		1,326,372		13.8	%		13,351,489		14.7	%		10.07
2011		115		2,043,595		21.2	%		17,290,738		19.1	%		8.46
2012		47		588,372		6.1	%		6,081,581		6.7	%		10.34
Thereafter		73		1,216,896		12.6	%		13,829,512		15.3	%		11.36
Total		783		9,635,032		100.0	%	$	90,700,913		100.0	%	$	9.41

¹ Triple-net equivalent.

-16-

Quarterly Supplemental Disclosure
March 31, 2007

LEASE EXPIRATIONS — CURRENT AND NEXT FOUR QUARTERS

			Gross Leased Area					Annualized Cash Rental Revenue
	Number of												Average Base
	Leases				Percent of					Percent of			Rent1,2 per
Quarter of Lease Expiration	Expiring		Square Footage		Total			Amount		Total			Sq. Ft.
2007 - Q1		4		25,369		1.7	%	$	547,054		3.8	%	$	21.56
2007 - Q2		41		357,003		23.7	%		3,140,993		21.9	%		8.80
2007 - Q3		33		320,353		21.3	%		2,667,840		18.6	%		8.33
2007 - Q4		50		546,952		36.3	%		4,826,057		33.7	%		8.82
2008 - Q1		32		255,865		17.0	%		3,149,198		22.0	%		12.31
Total		160		1,505,542		100.0	%	$	14,331,142		100.0	%	$	9.52

1	Triple-net equivalent.
2	2007-Q1 average rent per square foot included tenant holdover rate at 150%.

-17-

Quarterly Supplemental Disclosure
March 31, 2007

LEASING HISTORY BY ACQUISITION QUARTER¹

	Quarter Ending
	3/31/04			6/30/04			9/30/04			12/31/04			3/31/05			6/30/05			9/30/05			12/31/05			3/31/06			6/30/06			9/30/06			12/31/06			3/31/07
IPO		93.7	%		92.7	%		93.9	%		94.7	%		96.2	%		96.5	%		94.8	%		95.3	%		95.5	%		94.5	%		94.8	%		94.6	%		94.7	%
Post-IPO		82.0	%		87.4	%		89.7	%		91.9	%		92.2	%		92.4	%		89.7	%		90.5	%		90.9	%		90.5	%		91.1	%		91.4	%		92.7	%
Q3-2004 Acquisitions								95.2	%		94.3	%		93.7	%		94.3	%		91.9	%		92.5	%		92.1	%		91.5	%		92.1	%		91.4	%		90.2	%
Q4-2004 Acquisitions											92.0	%		92.0	%		91.5	%		90.2	%		93.2	%		97.1	%		97.1	%		97.1	%		97.1	%		93.4	%
Q1-2005 Acquisitions														91.6	%		91.6	%		91.6	%		91.6	%		91.6	%		91.6	%		92.2	%		94.0	%		94.0	%
Q2-2005 Acquisitions																	97.4	%		97.3	%		95.6	%		95.6	%		95.6	%		93.8	%		95.5	%		95.5	%
Q3-2005 Acquisitions																				42.0	%		42.0	%		42.5	%		44.7	%		41.3	%		49.4	%		47.0	%
Q4-2005 Acquisitions																							94.5	%		94.5	%		90.3	%		89.9	%		89.9	%		94.0	%
Q1-2006 Acquisitions																										88.4	%		91.2	%		91.2	%		91.5	%		93.5	%
Q2-2006 Acquisitions																													83.4	%		91.7	%		89.2	%		93.4	%
Q3-2006 Acquisitions																																68.6	%		68.7	%		70.2	%
Q4-2006 Acquisitions																																			82.0	%		80.7	%
Q1-2007 Acquisitions																																						94.3	%
Total Portfolio		91.6	%		91.5	%		93.7	%		93.8	%		94.2	%		94.9	%		87.7	%		89.3	%		89.6	%		88.7	%		87.9	%		88.1	%		88.8	%

¹ Percentage leased excludes sold properties.

-18-

Quarterly Supplemental Disclosure
March 31, 2007

LEASING ANALYSIS

	3 months ended
Leasing Production1	March 31, 2007
New and Renewal Leases
Square footage of new and renewal leases		444,568
Number of new and renewal leases commencing		48
Expired/Early Renewal/Terminated leases
Square footage of expired/early renewal leases		371,556
Square footage of terminated leases		12,988
Total — expired/early renewal/terminated leases		384,544
Net Absorption		60,024
New Leases
New square footage		170,226
Number of new leases commencing		20
Rental Change — Cash2
New base rent3	$	8.68
Percentage change in base rent		14.7	%
Rental Change — GAAP2
New base rent	$	9.12
Percentage change in base rent		14.2	%
Average capital cost per square foot	$	7.18
Average downtime between leases (months)		13.1
Average lease term (months)		40.0
Renewal Leases
Square footage of renewal leases		274,342
Number of renewal leases commencing		28
Retention rate		74	%
Suburban MD		72	%
Northern VA		72	%
Southern VA		75	%
Rental Change — Cash
New base rent3	$	8.98
Expiring base rent	$	8.17
Percentage change in base rent		9.9	%
Rental Change — GAAP
New base rent	$	9.37
Expiring base rent	$	8.71
Percentage change in base rent		7.6	%
Average capital cost per square foot	$	2.27
Average lease term (months)		39.3

1	Includes 44,287 square feet of leases and associated costs for leases signed in 1st quarter for subsequent periods, of which 34,942 square feet will commence in Q2 2007 and 9,345 square feet will commence in Q3 2007.
2	Quarter lease comparison based on eight leases totaling 60,552 square feet.
3	Calculated based on first-year rent.

-19-

Quarterly Supplemental Disclosure
March 31, 2007

PORTFOLIO BY SIZE

					% of Total					% of
Square Feet Under	Number of		Leased Square		Square Feet			Annualized		Annualized			Base Rent1
Lease	Leases		Feet		Leased			Base Rent1		Base Rent1			per SF
0-4,999		370		903,042		9.4	%	$	10,225,411		11.3	%	$	11.32
5,000-9,999		168		1,177,718		12.2	%		12,262,535		13.5	%		10.41
10,000-14,999		87		1,038,165		10.8	%		11,413,148		12.6	%		10.99
15,000-19,999		38		645,005		6.7	%		5,828,018		6.4	%		9.04
20,000-24,999		24		531,302		5.5	%		5,968,309		6.6	%		11.23
25,000-29,999		19		504,174		5.2	%		6,594,612		7.3	%		13.08
30,000-34,999		19		616,311		6.4	%		4,738,877		5.2	%		7.69
35,000-39,999		13		476,502		4.9	%		3,284,325		3.6	%		6.89
40,000-44,999		6		249,770		2.6	%		2,310,290		2.5	%		9.25
45,000-49,999		10		465,049		4.8	%		3,832,578		4.2	%		8.24
50,000-54,999		3		159,108		1.7	%		2,101,192		2.3	%		13.21
55,000-59,999		2		114,805		1.2	%		1,696,216		1.9	%		14.77
60,000-64,999		4		246,072		2.6	%		3,052,170		3.4	%		12.40
65,000-69,999		2		135,321		1.4	%		603,020		0.7	%		4.46
70,000-74,999		2		143,860		1.5	%		858,457		0.9	%		5.97
90,000-94,999		1		94,950		1.0	%		559,256		0.6	%		5.89
100,000-104,999		1		104,218		1.1	%		1,158,424		1.3	%		11.12
105,000-109,999		1		107,320		1.1	%		1,025,714		1.1	%		9.56
115,000-119,999		2		233,619		2.4	%		2,656,489		2.9	%		11.37
120,000-124,999		6		732,078		7.6	%		5,318,192		5.9	%		7.26
125,000-129,999		1		127,108		1.3	%		603,763		0.7	%		4.75
155,000-159,999		1		158,400		1.6	%		1,047,024		1.2	%		6.61
215,000-219,999		2		431,135		4.5	%		2,842,893		3.1	%		6.59
240,000-244,999		1		240,000		2.5	%		720,000		0.8	%		3.00
Total		783		9,635,032		100.0	%	$	90,700,913		100.0	%	$	9.41

¹ Triple-net equivalent.

-20-

Quarterly Supplemental Disclosure
March 31, 2007

MARKET CONCENTRATION

Market Concentration by Square Footage

	Maryland									Northern VA			Southern VA									Total
	Baltimore			Suburban MD			Subtotal						Richmond			Norfolk			Subtotal
Single-tenant industrial		—			2.3	%		2.3	%		2.1	%		—			—			—		4.4	%
Multi-tenant industrial		—			7.7	%		7.7	%		13.7	%		5.9	%		12.5	%		18.4	%	39.8	%
Flex		6.3	%		9.1	%		15.4	%		9.6	%		7.7	%		14.5	%		22.2	%	47.2	%
Office		0.8	%		1.2	%		2.0	%		1.0	%		—			3.7	%		3.7	%	6.7	%
Retail		—			1.9	%		1.9	%		—			—			—			—		1.9	%
Total		7.1	%		22.2	%		29.3	%		26.4	%		13.6	%		30.7	%		44.3	%	100.0	%

Market Concentration by Annualized Rent

	Maryland									Northern VA			Southern VA									Total
	Baltimore			Suburban MD			Subtotal						Richmond			Norfolk			Subtotal
Single-tenant industrial		—			2.3	%		2.3	%		2.4	%		—			—			—		4.7	%
Multi-tenant industrial		—			6.6	%		6.6	%		16.0	%		4.1	%		6.7	%		10.8	%	33.4	%
Flex		6.9	%		11.6	%		18.5	%		14.1	%		6.7	%		12.7	%		19.4	%	52.0	%
Office		1.0	%		2.0	%		3.0	%		1.4	%		—			4.1	%		4.1	%	8.5	%
Retail		—			1.4	%		1.4	%		—			—			—			—		1.4	%
Total		7.9	%		23.9	%		31.8	%		33.9	%		10.8	%		23.5	%		34.3	%	100.0	%

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Quarterly Supplemental Disclosure
March 31, 2007

PORTFOLIO ANALYSIS

PORTFOLIO BY MARKET

										Percentage
								Annualized		of
	Number of				Percent			Base Rent1 -		Annualized
	Buildings		Square Feet		Leased			Cash Basis		Base Rent1
Maryland		61		3,187,158		89.3	%	$	28,844,368		31.8	%
Baltimore		22		775,702		84.7	%		7,166,069		7.9	%
Suburban MD		39		2,411,456		90.8	%		21,678,299		23.9	%
Northern VA		48		2,868,509		90.9	%		30,705,843		33.9	%
Southern VA		51		4,797,747		87.2	%		31,150,702		34.3	%
Richmond		25		1,457,556		93.4	%		9,771,819		10.8	%
Norfolk		26		3,340,191		84.5	%		21,378,883		23.5	%
Total		160		10,853,414		88.8	%	$	90,700,913		100.0	%

PORTFOLIO BY PROPERTY TYPE

										Percentage
								Annualized		of
	Number of				Percent			Base Rent1 -		Annualized
	Buildings		Square Feet		Leased			Cash Basis		Base Rent1
Single-tenant industrial		4		482,182		100.0	%	$	4,333,889		4.8	%
Multi-tenant industrial		37		4,316,422		95.2	%		30,328,281		33.4	%
Flex		104		5,121,850		81.5	%		47,127,964		52.0	%
Office		14		731,610		92.5	%		7,683,706		8.5	%
Retail		1		201,350		96.6	%		1,227,073		1.3	%
Total		160		10,853,414		88.8	%	$	90,700,913		100.0	%

PORTFOLIO BY LEASE TYPE

					Percentage
	Number of				of Leased
	Leases		Square Feet2		Portfolio
Triple net		485		6,930,733		71.9	%
Industrial gross		120		888,184		9.2	%
Full service		178		1,816,115		18.9	%
Total		783		9,635,032		100.0	%

1	Triple-net equivalent.
2	Does not include vacant and core factor space.

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Quarterly Supplemental Disclosure
March 31, 2007

MARYLAND REGION

			Total Square		% of			%
	Buildings		Feet		Total			Leased
Suburban MD
15 Worman’s Mill Court		1		39,966		1.3	%		100.0	%
20270 Goldenrod Lane		1		24,468		0.8	%		96.1	%
4451 Georgia Pacific Boulevard		1		169,750		5.3	%		100.0	%
4612 Navistar Drive		1		215,085		6.7	%		100.0	%
6900 English Muffin Way		1		165,690		5.2	%		100.0	%
7561 Lindbergh Drive		1		36,000		1.1	%		100.0	%
Airpark Place		3		82,178		2.6	%		75.1	%
Ammendale Commerce Center		2		53,611		1.7	%		100.0	%
Campus at Metro Park North		4		190,238		6.0	%		100.0	%
Gateway 270 West		6		255,460		8.0	%		59.9	%
Gateway Center		2		44,307		1.4	%		100.0	%
Girard Business Center		3		123,900		3.9	%		66.1	%
Girard Place		4		175,217		5.5	%		100.0	%
Glenn Dale Business Center		1		315,191		9.9	%		99.2	%
Indian Creek Court		4		185,496		5.8	%		84.2	%
Old Courthouse Square		1		201,350		6.3	%		96.6	%
Patrick Center		1		66,659		2.1	%		90.8	%
West Park		1		28,950		0.9	%		87.9	%
Woodlands Business Center		1		37,940		1.2	%		79.7	%
Total		39		2,411,456		75.7	%		90.8	%
Baltimore
Deer Park		4		171,140		5.4	%		79.3	%
Gateway West		4		110,107		3.5	%		79.7	%
Owings Mills Business Center		4		87,148		2.7	%		97.6	%
Owings Mills Commerce Center		2		132,765		4.2	%		82.9	%
Rumsey Center		4		134,356		4.2	%		83.6	%
Snowden Center		4		140,186		4.3	%		89.8	%
Total		22		775,702		24.3	%		84.7	%
Grand Total		61		3,187,158		100.0	%		89.3	%

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Quarterly Supplemental Disclosure
March 31, 2007

MARYLAND REGION
LEASE EXPIRATIONS

								% of
Year of	SF of							Annual			Base
Lease	Expiring		% of			Annual Base		Base			Rent1
Expiration	Leases		Total SF			Rent1		Rent1			perSF
Vacant		340,623		10.7	%	$	—		—		$	—
MTM		30,200		0.9	%		316,310		1.1	%		10.47
2007		315,548		9.9	%		3,106,976		10.8	%		9.85
2008		367,841		11.5	%		4,188,921		14.5	%		11.39
2009		490,337		15.4	%		4,663,286		16.2	%		9.51
2010		449,606		14.1	%		4,111,688		14.3	%		9.15
2011		453,175		14.2	%		4,005,884		13.9	%		8.84
2012		168,778		5.4	%		2,072,565		7.2	%		12.28
2015		571,050		17.9	%		6,378,738		22.0	%		11.17
Total
		3,187,158		100.0	%	$	28,844,368		100.0	%	$	10.13

¹ Triple-net equivalent.

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Quarterly Supplemental Disclosure
March 31, 2007

NORTHERN VIRGINIA REGION

			Total
			Square		% of			%
	Buildings		Feet		Total			Leased
13129 Airpark Road		1		149,795		5.2	%		100.0	%
15395 John Marshall Highway		1		123,777		4.3	%		100.0	%
403/405 Glenn Drive		2		197,201		6.9	%		80.9	%
Alexandria Corporate Park		1		278,130		9.7	%		84.2	%
Aquia Commerce Center I & II		2		64,488		2.2	%		100.0	%
Davis Drive		1		52,581		1.8	%		70.7	%
Enterprise Center		4		188,941		6.6	%		81.9	%
Gateway Centre		3		99,607		3.5	%		86.1	%
Herndon Corporate Center		4		127,088		4.4	%		98.6	%
Interstate Plaza		1		107,320		3.7	%		100.0	%
Linden Business Center		3		108,237		3.8	%		81.8	%
Newington Business Park Center		7		254,242		8.9	%		91.1	%
Plaza 500		2		507,602		17.7	%		98.5	%
Prosperity Business Center		1		71,572		2.5	%		92.5	%
Reston Business Campus		4		82,469		2.9	%		94.0	%
Tech Court		2		64,064		2.2	%		77.0	%
Van Buren Business Park		5		109,310		3.8	%		90.2	%
Windsor at Battlefield		2		154,226		5.4	%		83.1	%
Sterling Park Business Center		2		127,859		4.5	%		96.9	%
Total		48		2,868,509		100.0	%		90.9	%

-25-

Quarterly Supplemental Disclosure
March 31, 2007

NORTHERN VIRGINIA REGION
LEASE EXPIRATIONS

								% of
	SF of							Annual			Base
	Expiring		% of			Annual Base		Base			Rent1
Year ofLeaseExpiration	Leases		Total SF			Rent1		Rent1			perSF
Vacant		262,302		9.1	%	$	—		—		$	—
MTM		1,500		0.1	%		11,031		—			7.35
2007		371,916		13.0	%		4,460,401		14.5	%		11.99
2008		309,721		10.8	%		3,572,171		11.6	%		11.53
2009		435,452		15.2	%		4,812,828		15.7	%		11.05
2010		472,163		16.5	%		5,668,089		18.5	%		12.00
2011		317,106		11.1	%		3,944,551		12.8	%		12.44
2012		291,300		10.2	%		2,776,270		9.0	%		9.53
2013		130,503		4.5	%		2,454,043		8.0	%		18.80
2014		145,817		5.0	%		1,176,398		3.9	%		8.07
2015		84,881		3.0	%		898,146		2.9	%		10.58
2016		45,848		1.5	%		931,915		3.1	%		20.33
		2,868,509		100.0	%	$	30,705,843		100.0	%	$	10.70

¹ Triple-net equivalent.

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Quarterly Supplemental Disclosure
March 31, 2007

SOUTHERN VIRGINIA REGION

			Total		% of			%
	Buildings		Square Feet		Total			Leased
Richmond
Virginia Center		1		118,884		2.5	%		95.9	%
River’s Bend Center		4		492,200		10.3	%		93.2	%
Northridge I, II		2		140,390		2.9	%		100.0	%
Airpark Business Center		2		42,142		0.9	%		83.6	%
Chesterfield Business Center		8		189,871		4.0	%		99.3	%
Hanover Business Center		4		183,069		3.8	%		97.5	%
Park Central		3		204,280		4.3	%		78.1	%
Pine Glen		1		86,720		1.7	%		100.0	%
Total		25		1,457,556		30.4	%		93.4	%
Norfolk
1000 Lucas Way		2		182,175		3.8	%		91.5	%
1400 Cavalier Boulevard		3		299,963		6.3	%		100.0	%
1434 Crossways Boulevard		2		220,501		4.6	%		100.0	%
Enterprise Parkway1		1		421,100		8.8	%		10.0	%
Coast Guard Building		1		61,992		1.3	%		100.0	%
Crossways Commerce Center I		1		348,615		7.3	%		95.5	%
Crossways Commerce Center II		2		147,736		3.1	%		100.0	%
Crossways I		1		143,398		3.0	%		85.1	%
Crossways II		1		85,004		1.8	%		100.0	%
Diamond Hill Distribution Center		4		712,550		14.9	%		99.8	%
Gateway II		1		42,429		0.9	%		85.9	%
Greenbrier Circle Corporate Center		2		229,163		4.7	%		95.7	%
Greenbrier Technology Center I		1		95,843		1.9	%		82.6	%
Greenbrier Technology Center II		1		79,684		1.7	%		99.0	%
Norfolk Business Center		1		90,682		1.9	%		97.6	%
Norfolk Commerce Park II		1		128,147		2.6	%		74.2	%
1408 Stephanie Way		1		51,209		1.0	%		64.6	%
Total		26		3,340,191		69.6	%		84.5	%
Grand Total		51		4,797,747		100.0	%		87.2	%

¹ Formerly 2000 Gateway Boulevard.

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Quarterly Supplemental Disclosure
March 31, 2007

SOUTHERN VIRGINIA REGION
LEASE EXPIRATIONS

	SF of							% of
	Expiring		% of			Annual Base		Annual			Base Rent1
Year ofLeaseExpiration	Leases		Total SF			Rent1		Base Rent1			per SF
Vacant		615,457		12.8	%	$	—		—		$	—
MTM		27,761		0.6	%		237,882		0.8	%		8.57
2007		562,213		11.7	%		3,614,568		11.6	%		6.43
2008		772,994		16.1	%		5,471,090		17.6	%		7.08
2009		774,314		16.1	%		5,692,128		18.3	%		7.35
2010		404,603		8.4	%		3,571,711		11.5	%		8.83
2011		1,273,314		26.5	%		9,340,303		30.0	%		7.34
2012		128,294		2.7	%		1,232,746		4.0	%		9.61
2013		64,466		1.3	%		784,280		2.5	%		12.17
2014		55,821		1.2	%		566,781		1.8	%		10.15
2015		13,360		0.3	%		75,829		0.2	%		5.68
2017		105,150		2.3	%		563,384		1.7	%		5.36
Total		4,797,747		100.0	%	$	31,150,702		100.0	%	$	7.45

¹ Triple-net equivalent.

-28-

Quarterly Supplemental Disclosure
March 31, 2007

MANAGEMENT STATEMENTS ON NON-GAAP SUPPLEMENTAL MEASURES

Investors and analysts following the real estate industry utilize funds from operations (“FFO”), net operating income (“NOI”), EBITDA and adjusted funds from operations (“AFFO”), variously defined, as supplemental performance measures.

While the Company believes net income available to common stockholders as defined by GAAP is the most appropriate measure, it considers FFO, NOI, EBITDA, and AFFO appropriate supplemental measures given their wide use by and relevance to investors and analysts. FFO, reflecting the assumption that real estate asset values rise or fall with market conditions, principally adjusts for the effects of GAAP depreciation/amortization of real estate assets. NOI provides a measure of rental operations and does not factor in depreciation/amortization and non-property specific expenses such as general and administrative expenses. EBITDA provides a further tool to evaluate the ability to incur and service debt and to fund dividends and other cash needs. AFFO provides a further tool to evaluate the ability to fund dividends. In addition, FFO, NOI, EBITDA and AFFO are commonly used in various ratios, pricing multiples/yields and returns and valuation calculations used to measure financial position, performance and value.

Net Operating Income

Management believes that NOI is a useful supplemental measure of the Company’s operating performance. The Company defines NOI as operating revenues (rental income, tenant reimbursements, and other income) less property and related expenses (property expenses, real estate taxes, and insurance). Other real estate investment trust (“REITs”) may use different methodologies for calculating NOI, and accordingly, the Company’s NOI may not be comparable to other REITs.

Because NOI excludes general and administrative expenses, interest expense, depreciation and amortization, gains and losses from property dispositions, discontinued operations, and extraordinary items, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate properties and the impact to operations from trends in occupancy rates, rental rates, and operating costs, providing perspective not immediately apparent from net income. The Company uses NOI to evaluate its operating performance since NOI allows the Company to evaluate the impact that factors such as occupancy levels, lease structure, lease rates, and tenant base have on the Company’s results, margins and returns. In addition, management believes that NOI provides useful information to the investment community about the Company’s financial and operating performance when compared to other REITs since NOI is generally recognized as a standard measure of performance in the real estate industry.

However, NOI should not be viewed as an alternative measure of the Company’s financial performance since it does not reflect general and administrative expenses, interest expense, depreciation and amortization costs, the level of capital expenditures and leasing costs necessary to maintain the operating performance of the Company’s properties.

EBITDA

Management believes that EBITDA is a useful supplemental measure of the Company’s operating performance. EBITDA is defined as earnings before interest, taxes, depreciation and amortization.

Management considers EBITDA to be an appropriate supplemental performance measure since it represents earnings prior to the impact of depreciation, amortization, gain (loss) from property dispositions and loss on early retirement of debt. This calculation facilitates the review of income from operations without considering the effect of non-cash depreciation and amortization or the cost of debt.

Management believes that FFO is a useful supplemental measure of the Company’s operating performance. As defined by the National Association of Real Estate Investment Trusts, or NAREIT, FFO represents net income (loss) before minority interest (computed in accordance with GAAP) plus real estate related depreciation and amortization (excluding amortization of deferred financing costs) and after adjustments for unconsolidated partnerships and joint ventures and including gains (or losses) from debt restructuring and excluding gain on sale of property. Other REITs may use different methodologies for calculating FFO and, accordingly, the Company’s FFO may not be comparable to other REITs.

Management considers FFO a useful additional measure of performance for an equity REIT because it facilitates an understanding of the operating performance of its properties without giving effect to real estate depreciation and amortization, which assumes that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, we believe that FFO provides a more meaningful and accurate indication of our performance. In addition, management believes that FFO provides useful information to the investment community about the Company’s financial performance when compared to other REITs since FFO is generally recognized as the industry standard for reporting the operations of REITs.

However, FFO should not be viewed as an alternative measure of the Company’s operating performance since it does not reflect either depreciation and amortization costs or the level of capital expenditures and leasing costs necessary to maintain the operating performance of the Company’s properties, which are significant economic costs that could materially impact the Company’s results of operations.

Adjusted Funds From Operations

Management believes that AFFO is a useful measure of the Company’s liquidity. The Company computes AFFO by adding to FFO equity based compensation expense and the non-cash amortization of deferred financing costs and non-real estate depreciation, and then subtracting cash paid for any recurring tenant improvements, leasing commissions, and recurring capital expenditures, and eliminating the net effect of straight-line rents, deferred market rent and debt fair value amortization.

First generation costs include tenant improvements, leasing commissions and capital expenditures that were taken into consideration when underwriting the purchase of a property or incurred to bring the property to operating standard for its intended use. The Company also excludes development related expenditures. AFFO provides an additional perspective on the Company’s ability to fund cash needs and make distributions to shareholders by adjusting for the effect of these non-cash items included in FFO, as well as recurring capital expenditures and leasing costs. However, other REITs may use different methodologies for calculating AFFO and, accordingly, the Company’s AFFO may not be comparable to other REITs.

-29-