First Potomac Realty Trust 8K Reports Third Quarter 2007 Results | FPO 31 Oct 07

Exhibit 99.2

Third 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
September 30, 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

Outstanding Debt		9

Net Asset Value Analysis		11

Debt Maturity Schedule		12

Portfolio Summary		13

Maryland Region		14

Northern Virginia Region		15

Southern Virginia Region		16

Land and Properties Available for Development or Redevelopment		17

Top Ten Tenants		18

Lease Expirations		19

Lease Expirations — Current and Next Four Quarters		20

Leasing History by Acquisition Quarter		21

Leasing Analysis		22

Portfolio by Size		23

Market Concentration		24

Portfolio Analysis		25

Maryland Region — Lease Expirations		26

Northern Virginia Region — Lease Expirations		27

Southern Virginia Region — Lease Expirations		28

Management Statements		29

TOC

Quarterly Supplemental Disclosure
September 30, 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 properties and business parks in the Washington, D.C. 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 certain figures are rounded to the nearest thousand throughout this document which may impact footing and/or crossfooting of subtotals and totals.

Quarterly Supplemental Disclosure
September 30, 2007

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


	Three Months Ended
	September 30, 2007					June 30, 2007					March 31, 2007					December 31, 2006					September 30, 2006
OPERATING REVENUES
Rental	$	26,109		83.7	%	$	25,794		84.0	%	$	24,920		83.1	%	$	23,256		83.6	%	$	22,865		84.3	%
Tenant reimbursements and other		5,077		16.3	%		4,895		16.0	%		5,056		16.9	%		4,552		16.4	%		4,264		15.7	%


		31,186		100.0	%		30,689		100.0	%		29,976		100.0	%		27,808		100.0	%		27,129		100.0	%

PROPERTY EXPENSES
Property operating		6,730		21.6	%		6,168		20.1	%		6,558		21.9	%		5,541		19.9	%		5,536		20.4	%
Real estate taxes and insurance		2,933		9.4	%		2,829		9.2	%		2,634		8.8	%		2,448		8.8	%		2,257		8.3	%


NET OPERATING INCOME	$	21,523		69.0	%	$	21,692		70.7	%	$	20,784		69.3	%	$	19,819		71.3	%	$	19,336		71.3	%


OTHER INCOME (EXPENSE)
General and administrative		(2,362	)	7.6	%		(2,621	)	8.5	%		(2,966	)	9.9	%		(2,332	)	8.4	%		(2,436	)	9.0	%
Interest and other income		123		0.4	%		172		0.6	%		194		0.6	%		289		1.0	%		175		0.6	%


EBITDA		19,284		61.8	%		19,243		62.7	%		18,012		60.1	%		17,776		63.9	%		17,075		62.9	%

Depreciation and amortization		(9,915	)				(10,392	)				(9,948	)				(9,542	)				(9,174	)
Interest expense		(9,137	)				(8,835	)				(8,289	)				(7,502	)				(7,155	)


Income (loss) from continuing operations before minority interests		232					16					(225	)				732					746

Minority interests		(7	)				—					5					(28	)				(28	)


NET INCOME (LOSS)	$	225				$	16				$	(220	)			$	704				$	718

Quarterly Supplemental Disclosure
September 30, 2007

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


	Three Months Ended
	September 30, 2007			June 30, 2007			March 31, 2007			December 31, 2006			September 30, 2006
FUNDS FROM OPERATIONS (“FFO”)

Net income (loss)	$	225		$	16		$	(220	)	$	704		$	718
Add back:
Depreciation & amortization of real estate assets¹		9,915			10,392			9,948			9,542			9,174
Minority interests		7			—			(5	)		28			28


FFO	$	10,147		$	10,408		$	9,723		$	10,274		$	9,920


ADJUSTED FUNDS FROM OPERATIONS (“AFFO”)
FFO	$	10,147		$	10,408		$	9,723		$	10,274		$	9,920
Non-cash stock-based compensation		408			401			314			293			338
Straight-line rent, net²		(43	)		(113	)		(263	)		(213	)		(283	)
Deferred market rent		(412	)		(453	)		(434	)		(446	)		(676	)
Non-real estate depreciation¹		196			175			198			142			107
Debt fair value amortization		(799	)		(781	)		(755	)		(798	)		(760	)
Amortization of finance costs		323			232			260			257			203
Amortization of discounts		141			141			141			47			—
Tenant improvements³		(1,601	)		(1,057	)		(711	)		(636	)		(202	)
Leasing commissions³		(845	)		(561	)		(859	)		(353	)		(290	)
Capital expenditures³		(528	)		(593	)		(620	)		(1,073	)		(901	)


AFFO	$	6,987		$	7,799		$	6,994		$	7,494		$	7,456


Total weighted average shares and OP units
Basic		24,880			24,804			24,847			24,947			24,163

Diluted		25,004			25,004			25,093			25,207			24,446


FFO per share:
FFO per share and unit — basic and diluted	$	0.41		$	0.42		$	0.39		$	0.41		$	0.41


AFFO per share:
AFFO per share and unit — basic	$	0.28		$	0.31		$	0.28		$	0.30		$	0.31

AFFO per share and unit — diluted	$	0.28		$	0.31		$	0.28		$	0.30		$	0.30


¹Non-real estate depreciation is classified in general and administrative expense.

²Straight-line rent is net of rent abatement and write-off of uncollectible accounts.

³The following first-generation, development and redevelopment costs have been excluded from the calculation of AFFO:


First-generation costs
Tenant improvements	$	1,268	$	1,328	$	593	$	639	$	100
Leasing commissions		376		221		137		127		156
Capital expenditures		2,412		1,417		1,140		1,072		2,134
Development		2,767		1,952		2,766		2,866		1,633
Redevelopment		239		35		—		—		—

	$	7,062	$	4,953	$	4,636	$	4,704	$	4,023

Quarterly Supplemental Disclosure
September 30, 2007

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


	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Total base rent	$	21,838		$	22,301		$	57,866		$	58,271
Tenant reimbursement and other		4,310			4,014			11,624			11,385
Property operating expenses		(5,468	)		(5,424	)		(14,386	)		(13,620	)
Real estate taxes and insurance		(2,500	)		(2,165	)		(6,261	)		(5,863	)


Same-property¹NOI — accrual basis		18,180			18,726			48,843			50,173

Straight-line revenue, net		(37	)		(256	)		(156	)		(799	)
Deferred market rental revenue		(354	)		(671	)		(909	)		(1,452	)


Same-property¹ NOI — cash basis	$	17,789		$	17,799		$	47,778		$	47,922


Change in same-property NOI — accrual basis		-2.9	%					-2.7	%
Change in same-property NOI — cash basis		-0.1	%					-0.3	%

Change in Same Property NOI — accrual basis
Rental revenue increase (decrease)	$	(303	)				$	217
Tenant reimbursement and other increase		296						239
Occupancy decrease		(160	)					(622	)
Expense increase		(379	)					(1,164	)

	$	(546	)				$	(1,330	)


Same property percentage of total portfolio (sf)		84.7	%		95.1	%		72.5	%		81.4	%

Analysis of Same Property NOI

Total revenue	$	31,186		$	27,129		$	91,851		$	76,727
Property operating expenses		6,730			5,536			19,456			14,652
Real estate taxes and insurance		2,933			2,257			8,396			6,578

NOI		21,523			19,336			63,999			55,497

Less: Non-same property NOI²		(3,343	)		(610	)		(15,156	)		(5,324	)


Same-property¹NOI — accrual basis		18,180			18,726			48,843			50,173


Straight-line revenue, net		(37	)		(256	)		(156	)		(799	)
Deferred market rental revenue		(354	)		(671	)		(909	)		(1,452	)


Same-property¹ NOI — cash basis	$	17,789		$	17,799		$	47,778		$	47,922


Change in same-property NOI — accrual basis		-2.9	%					-2.7	%
Change in same-property NOI — cash basis		-0.1	%					-0.3	%


¹		Same-property comparisons are based upon those properties owned for the entirety of the periods presented. Same property results exclude the results of the following non-same properties: 6600 Business Parkway, Gateway 270 West, Davis Drive, Indian Creek Court, Gateway II, Owings Mills Commerce Center, Park Central, Greenbrier Circle Corporate Center, Greenbrier Technology Center I, Pine Glen, Ammendale Commerce Center, John Marshall Highway (Building II), River’s Bend II and Annapolis Commerce Park East. Also, same-property results for the nine months ended September 30, 2007 and 2006 exclude Northridge I & II, River’s Bend Center, Crossways I, Sterling Park Business Center, 1408 Stephanie Way, Airpark Business Center, Chesterfield Business Center and Hanover Business Center.

²		Non-same property NOI has been adjusted to reflect a normalized management fee percentage in lieu of an administrative overhead allocation for comparative purposes.

Quarterly Supplemental Disclosure
September 30, 2007

CONSOLIDATED BALANCE SHEETS
(amounts in thousands, except per share amounts)


	September 30, 2007			December 31, 2006
	(unaudited)
Assets
Rental property, net	$	975,539		$	884,882
Cash and cash equivalents		4,210			41,367
Escrows and reserves		12,146			11,139
Accounts and other receivables, net of allowance for doubtful accounts of $636 and $334, respectively		3,901			4,212
Accrued straight-line rents, net of allowance for doubtful accounts of $43 and $41, respectively		6,249			4,973
Deferred costs, net		11,945			9,006
Prepaid expenses and other assets		7,711			6,191
Intangible assets, net		30,347			32,797


Total assets	$	1,052,048		$	994,567


Liabilities
Mortgage loans	$	392,220		$	391,393
Exchangeable senior notes, net of discount		122,656			122,234
Senior notes		75,000			75,000
Secured term loan		50,000			—
Unsecured revolving credit facility		25,100			—
Accounts payable and accrued expenses		13,191			8,898
Accrued interest		5,395			2,420
Rents received in advance		3,311			3,196
Tenant security deposits		5,407			4,965
Deferred market rent		9,741			8,883


Total liabilities		702,021			616,989


Minority interest		11,802			13,992

Shareholders’ Equity
Common shares, $0.001 par value, 100,000 common shares authorized; 24,251 and 24,127 shares issued and outstanding, respectively		24			24
Additional paid-in capital		429,555			430,271
Dividends in excess of accumulated earnings		(91,354	)		(66,709	)


Total shareholders’ equity		338,225			363,586


Total liabilities and shareholders’ equity	$	1,052,048		$	994,567

Quarterly Supplemental Disclosure
September 30, 2007

TOTAL MARKET CAPITALIZATION
(unaudited, amounts in thousands)


			Percent of
			Total Market
			Capitalization
Total common shares outstanding		24,251
Operating Partnership (“OP”) units held by third parties		807


Total common shares and OP units		25,058

Market price at September 30, 2007	$	21.80


Total equity capitalization	$	546,264		45.1	%


Debt capitalization
Fixed-rate debt	$	589,876		48.7	%
Floating-rate debt		75,100		6.2	%


Total debt capitalization	$	664,976		54.9	%


Total market capitalization	$	1,211,240		100.0	%

Quarterly Supplemental Disclosure
September 30, 2007

SELECTED OPERATING RATIOS
(unaudited, dollars in thousands)


	Three Months Ended
	September 30, 2007			June 30, 2007			March 31, 2007			December 31, 2006			September 30, 2006
COVERAGE RATIO

Interest Coverage Ratio
EBITDA	$	19,284		$	19,243		$	18,012		$	17,776		$	17,075
Divided by Interest Expense		9,137			8,835			8,289			7,502			7,155

		2.11	x		2.18	x		2.17	x		2.37	x		2.39	x

OVERHEAD RATIO

G&A to Real Estate Revenues
General and Administrative Expense	$	2,362		$	2,621		$	2,966		$	2,332		$	2,436
Real Estate Revenues		31,186			30,689			29,976			27,808			27,129

		7.6	%		8.5	%		9.9	%		8.4	%		9.0	%

LEVERAGE RATIO

Debt/Total Market Capitalization
Total Debt	$	664,976		$	655,800		$	613,711		$	588,627		$	493,750
Total Market Capitalization		1,211,240			1,239,051			1,324,847			1,318,356			1,250,701

		54.9	%		52.9	%		46.3	%		44.6	%		39.5	%

Quarterly Supplemental Disclosure
September 30, 2007

OUTSTANDING DEBT
(unaudited, amounts in thousands)

				��
					Principal
					Balance				Effective
	Effective Interest				September 30,		Annualized Debt		Maturity		Balance at
Encumbered Properties	Rate				2007		Service		Date		Maturity
Fixed Rate Debt

Herndon Corporate Center¹		5.66	%		$	8,567	$	603		4/1/2008	$	8,549
Norfolk Commerce Park II¹		5.28	%			7,259		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	%			74,146		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	%			8,581		780		5/1/2009		8,033
4200 Tech Court		8.07	%			1,758		168		10/1/2009		1,705
Park Central I¹		5.66	%			5,048		519		11/1/2009		4,523
4212 Tech Court		8.53	%			1,715		169		6/1/2010		1,654
Park Central II¹		5.66	%			6,267		638		11/1/2010		5,289
Enterprise Center¹		5.20	%			18,937		1,647		12/1/2010		16,712
Indian Creek Court¹		5.90	%			13,292		1,162		1/1/2011		11,982
403 and 405 Glenn Drive¹		5.50	%			8,854		746		7/1/2011		7,807
4612 Navistar Drive¹		5.20	%			13,673		1,131		7/11/2011		11,921
Campus at Metro Park North¹		5.25	%			25,076		2,028		2/11/2012		21,581
1434 Crossways Boulevard Building II¹		5.38	%			10,615		826		8/5/2012		8,866
Crossways Commerce Center		6.70	%			25,468		2,087		10/1/2012		23,313
Newington Business Park Center		6.70	%			16,065		1,316		10/1/2012		14,706
Prosperity Business Center¹		5.75	%			3,888		332		1/1/2013		3,242
Aquia Commerce Center I		7.28	%			752		165		2/1/2013		42
1434 Crossways Boulevard Building I¹		5.38	%			9,050		665		3/5/2013		7,597
Linden Business Center¹		5.58	%			7,548		559		10/1/2013		6,596
Owings Mills Business Center¹		5.75	%			5,764		425		3/1/2014		5,066
Annapolis Commerce Park East¹		6.25	%			8,861		665		6/1/2014		8,010

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	%			985		161		8/1/2015		13
Hanover Building C¹		6.63	%			1,383		161		12/1/2017		13

Chesterfield Business Center
Chesterfield Buildings C, D, G and H¹		6.63	%			2,562		414		8/1/2015		34
Chesterfield Buildings A, B, E and F¹		6.63	%			2,861		318		6/1/2021		26

Gateway Centre Building I¹		5.88	%			1,684		239		11/1/2016		—
Airpark Business Center¹		6.63	%			1,561		173		6/1/2021		14

					$	392,220	$	30,369			$	356,153


Convertible Debt
Exchangeable Senior Notes²		4.45	%		$	122,656	$	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					$	589,876	$	40,229			$	556,153

Quarterly Supplemental Disclosure
September 30, 2007

OUTSTANDING DEBT CONTINUED
(unaudited, amounts in thousands)

Principal

Balance

Effective

September 30,

Annualized

Maturity

Balance at

Interest Rate

2007

Debt Service

Date

Maturity

Floating Rate Debt

Secured Term Loan³

LIBOR + 1.10%

50,000

3,110

8/7/2010

50,000

Unsecured Revolving Credit Facility⁴

LIBOR + 1.20%

25,100

1,586

4/26/2010

25,100

Total at September 30, 2007

664,976

44,925

631,253


¹		The balance includes the fair value impacts recorded at acquisition upon assumption of the mortgages encumbering these properties. The fair value impacts at September 30, 2007 and actual interest rates are:


				Contractual
Property	Fair Value Impact			Interest Rate
Herndon Corporate Center	$	(48	)		5.11	%
Deer Park through Woodlands Business Center		1,072			6.71	%
Norfolk Commerce Park II		121			6.90	%
4612 Navistar Drive		1,065			7.48	%
Campus at Metro Park North		1,813			7.11	%
Enterprise Center		1,538			8.03	%
Glenn Dale Business Center		390			7.83	%
Gateway Centre Building I		96			7.35	%
1434 Crossways Boulevard Building I		605			6.25	%
1434 Crossways Boulevard Building II		970			7.05	%
403 and 405 Glenn Drive		615			7.60	%
Linden Business Center		164			6.01	%
Owings Mills Business Center		31			5.85	%
Prosperity Business Center		69			6.25	%
Airpark Business Center		74			7.45	%
Hanover Building C		77			7.88	%
Hanover Building D		79			8.88	%
Chesterfield Buildings A, B, E and F		135			7.45	%
Chesterfield Buildings C, D, G and H		173			8.50	%
Indian Creek Court		749			7.80	%
Park Central I		238			8.00	%
Park Central II		462			8.32	%
Annapolis Commerce Park East		(250	)		5.74	%

Total fair value increase (decrease)	$	10,238


²		The notes were issued on December 11, 2006 at a $2.8 million discount.

³		On August 7, 2007, the Company entered into a $50.0 million Secured Term Loan Facility with Key Bank, N.A. The facility, which matures in August 2010, has a one-year extension option and can be expanded to $100.0 million. Borrowings on the facility bear interest at 70 to 125 basis points over LIBOR, depending on the Company’s overall leverage.

⁴		As of September 30, 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 Enterprise Parkway, 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, Interstate Plaza, Gateway II, Owings Mills Commerce Center, Greenbrier Circle Corporate Center, Greenbrier Technology Center I, Pine Glen, Ammendale Commerce Center, River’s Bend Center II, Park Central (Building V) and Hanover AB.

Quarterly Supplemental Disclosure
September 30, 2007

NET ASSET VALUE ANALYSIS

(unaudited, in thousands)



	2007-Q3			Annualized
Income Statement Items

Total Portfolio In-Place Cash NOI
Total GAAP Revenue	$	31,186		$	124,744
Straight-line and Deferred Market Rents		(456	)		(1,824	)
Management Fee Adjustment		357			1,428
Property Operating Costs		(9,668	)		(38,672	)

Total Portfolio In-Place Cash NOI	$	21,419		$	85,676


Total Portfolio Cash NOI @ 94% Occupancy
Total Revenue	$	33,657		$	134,628
Straight-line and Deferred Market Rents		(834	)		(3,336	)
Property Operating Costs		(9,806	)		(39,224	)

Total Portfolio Cash NOI	$	23,017		$	92,068


Balance Sheet Items

Land for Future Development & CIP
Original Cost Basis of Land held for Future Development	$	18,510
Original Cost Basis of Development Assets		4,490
Original Cost Basis of Redevelopment Assets¹		17,639
Construction In Progress		11,103

Total Land for Future Development & CIP	$	51,742


Current Quarter Acquisitions
Cost Basis of Current Quarter Acquisitions	$	—

Total Current Quarter Acquisitions	$	—


Select Balance Sheet Items
Cash and cash equivalents, escrows and reserves	$	16,118
Accounts and other receivables, net of allowance		3,901
Prepaid expenses and other assets		7,711
Accounts payable and accrued expenses		(12,954	)
Accrued interest		(5,395	)
Rents received in advance		(3,311	)
Tenant security deposits		(5,407	)
Mortgage and Senior Debt, cash principal balances		(654,738	)

Total	$	(654,075	)


¹		Represents portion of original purchase under redevelopment.

Quarterly Supplemental Disclosure
September 30, 2007

DEBT MATURITY SCHEDULE

Quarterly Supplemental Disclosure
September 30, 2007

PORTFOLIO SUMMARY
(unaudited)


					Leased at			Occupied at
	Square		Annualized		September 30,			September 30,			Occupancy at
Portfolio	Footage		Base Rent¹		2007			2007			Acquisition
*Core Portfolio*²
Baltimore		876,732	$	8,817,865		87.5	%		85.2	%
Suburban Maryland		2,155,975		20,245,632		93.7	%		93.4	%
Northern Virginia		2,670,106		28,822,265		90.3	%		89.5	%
Richmond		1,556,728		8,934,102		90.0	%		88.7	%
Norfolk		2,843,832		20,342,497		94.2	%		94.2	%


		10,103,373		87,162,361		91.8	%		91.2	%


*Value-add Portfolio*
Baltimore		—		—		—			—			—
Suburban Maryland		239,060		2,505,348		83.1	%		68.3	%		54.3	%
Northern Virginia		281,369		3,142,357		89.6	%		89.6	%		58.9	%
Richmond		204,280		2,010,733		89.8	%		82.5	%		78.1	%
Norfolk		371,793		1,651,767		63.5	%		19.7	%		0.0	%


		1,096,502		9,310,205		79.4	%		59.9	%		41.5	%


Total		11,199,875	$	96,472,566		90.6	%		88.1	%


*Redevelopment*³
Baltimore		—
Suburban Maryland		92,147
Northern Virginia		27,004
Richmond		—
Norfolk		83,549


		202,700


Grand Total		11,402,575


Estimated Move-In Schedule	Square Footage		Annualized Base Rent¹
2007-Q4		145,945	$	1,745,814
2008-Q1		134,589		585,462


Total		280,534	$	2,331,276


¹		Annualized cash rents have been adjusted to reflect triple-net equivalent.

²		Stabilized at acquisition.

³		Redevelopment of existing structures.

Quarterly Supplemental Disclosure
September 30, 2007

MARYLAND REGION

(unaudited)


									Leased at			Occupied at
			Property		Square		Annualized Cash		September 30,			September 30,
Property	Buildings		Type^1,2,3	Location	Footage		Basis Rent⁴		2007			2007
SUBURBAN MD

*Frederick*
15 Worman’s Mill Court		1	BP	Frederick		39,966	$	378,801		100.0	%		100.0	%
4451 Georgia Pacific Boulevard		1	MTI	Frederick		169,750		1,223,835		100.0	%		100.0	%
4612 Navistar Drive		1	STI	Frederick		215,085		1,852,988		100.0	%		100.0	%
6900 English Muffin Way		1	MTI	Frederick		165,690		1,177,515		100.0	%		100.0	%
Patrick Center		1	Office	Frederick		66,794		1,286,803		90.1	%		90.1	%
West Park		1	Office	Frederick		28,950		304,858		87.9	%		87.9	%

*I-270 Corridor*
20270 Goldenrod Lane		1	BP	Germantown		24,468		279,873		96.1	%		96.1	%
7561 Lindbergh Drive		1	STI	Gaithersburg		36,000		309,450		100.0	%		100.0	%
Airpark Place		3	BP	Gaithersburg		82,178		741,950		70.2	%		70.2	%
Campus at Metro Park North		4	BP	Rockville		190,238		3,868,681		100.0	%		100.0	%
Gateway 270 West		6	BP	Clarksburg		239,060		2,505,348		83.1	%		68.3	%
Gateway Center		2	BP	Gaithersburg		44,307		610,012		96.5	%		96.5	%
Girard Business Center		3	BP	Gaithersburg		123,744		980,958		67.1	%		62.4	%
Girard Place		4	BP	Gaithersburg		175,217		1,467,383		100.0	%		100.0	%

*Beltsville*
Ammendale Commerce Center		2	BP	Beltsville		53,611		467,557		100.0	%		100.0	%
Indian Creek Court		4	MTI	Beltsville		185,496		1,883,273		84.2	%		84.2	%

*Other*
Glenn Dale Business Center		1	MTI	Glenn Dale		315,191		1,726,314		96.4	%		96.4	%
Old Courthouse Square		1	Retail	Martinsburg, WV		201,350		1,253,824		96.6	%		96.6	%
Woodlands Business Center		1	Office	Largo		37,940		431,557		72.7	%		72.7	%


Total		39				2,395,035		22,750,980		92.7	%		90.9	%

													��
BALTIMORE

*Owings Mills*
Deer Park		4	BP	Randallstown		171,125		1,008,770		75.2	%		75.2	%
Gateway West		4	BP	Westminster		110,107		961,140		79.7	%		79.7	%
Owings Mills Business Center		4	BP	Owings Mills		87,076		928,380		94.6	%		94.6	%
Owings Mills Commerce Center		2	BP	Owings Mills		132,765		1,287,136		95.2	%		82.9	%

*Columbia*
Rumsey Center		4	BP	Columbia		134,296		1,281,263		85.0	%		85.0	%
Snowden Center		4	BP	Columbia		140,061		1,836,894		91.1	%		88.4	%

*Other*
Annapolis Commerce Park East		2	Office	Annapolis		101,302		1,514,282		98.8	%		98.8	%


Total		24				876,732		8,817,865		87.5	%		85.2	%


Grand Total		63				3,271,767	$	31,568,845		91.3	%		89.4	%


¹		MTI = Multi-tenant industrial.

²		STI = Single-tenant industrial.

³		BP = Business Park.

⁴		Triple-net equivalent.

Quarterly Supplemental Disclosure
September 30, 2007

NORTHERN VIRGINIA REGION
(unaudited)


							Annualized		Leased at			Occupied at
			Property		Square		Cash Basis		September 30,			September 30,
Property	Buildings		Type^1,2,3	Location	Footage		Rent⁴		2007			2007
*Alexandria*
Alexandria Corporate Park		1	MTI	Alexandria		279,070	$	3,996,225		87.6	%		80.4	%
Interstate Plaza		1	STI	Alexandria		107,320		1,025,714		100.0	%		100.0	%
Plaza 500		2	MTI	Alexandria		504,602		5,533,971		99.1	%		99.1	%

*Manassas*
Gateway Centre		3	BP	Manassas		95,546		747,804		69.8	%		69.8	%
Linden Business Center		3	BP	Manassas		98,248		879,217		67.3	%		67.3	%
Windsor at Battlefield		2	BP	Manassas		153,510		1,555,622		83.5	%		83.5	%

*Reston/Herndon*
Herndon Corporate Center		4	BP	Herndon		127,576		1,590,899		73.4	%		73.4	%
Van Buren Business Park		5	BP	Herndon		107,877		1,321,651		76.6	%		75.4	%
Reston Business Campus		4	BP	Reston		82,584		1,112,087		93.9	%		93.9	%

*Sterling*
403/405 Glenn Drive		2	BP	Sterling		185,247		1,201,025		87.3	%		87.3	%
Davis Drive		1	BP	Sterling		53,045		391,030		84.2	%		84.2	%
Sterling Park Business Center		2	BP	Sterling		127,859		1,586,736		96.9	%		96.9	%

*Chantilly*
Enterprise Center		4	BP	Chantilly		188,758		2,581,164		82.0	%		82.0	%
Tech Court		2	BP	Chantilly		64,064		488,965		77.0	%		77.0	%

*Other*
13129 Airpark Road		1	MTI	Culpeper		149,795		820,436		100.0	%		100.0	%
15395 John Marshall Highway		1	STI	Haymarket		236,082		2,993,520		100.0	%		100.0	%
Newington Business Park Center		7	MTI	Lorton		254,242		2,429,837		94.3	%		94.3	%
Prosperity Business Center		1	BP	Merrifield		71,562		829,281		100.0	%		100.0	%
Aquia Commerce Center I & II		2	BP	Stafford		64,488		879,438		100.0	%		100.0	%


Total		48				2,951,475	$	31,964,622		90.2	%		89.5	%


¹		MTI = Multi-tenant industrial.

²		STI = Single-tenant industrial.

³		BP = Business Park.

⁴		Triple-net equivalent.

Quarterly Supplemental Disclosure
September 30, 2007

SOUTHERN VIRGINIA REGION
(unaudited)


							Annualized		Leased at			Occupied at
			Property		Square		Cash Basis		September 30,			September 30,
Property	Buildings		Type^1,2,3	Location	Footage		Rent⁴		2007			2007
RICHMOND

*North*
Virginia Center		1	BP	Glen Allen		119,446	$	1,262,848		95.0	%		84.8	%
Northridge I, II		2	MTI	Ashland		140,390		716,298		91.6	%		91.6	%
Hanover Business Center		4	BP	Ashland		183,190		1,045,059		92.1	%		87.8	%

*South*
River’s Bend Center		4	MTI	Chester		492,633		2,765,388		83.8	%		83.8	%
River’s Bend Center II		2	BP	Chester		302,400		1,275,234		92.1	%		92.1	%
Airpark Business Center		2	BP	Richmond		42,144		287,786		91.7	%		91.7	%
Chesterfield Business Center		8	BP	Richmond		189,805		1,130,547		91.5	%		91.5	%
Park Central		3	BP	Richmond		204,280		2,010,733		89.8	%		82.5	%
Pine Glen		1	BP	Richmond		86,720		450,942		100.0	%		100.0	%


Total		27				1,761,008		10,944,835		90.0	%		88.0	%


NORFOLK

*Crossways*
Coast Guard Building		1	BP	Chesapeake		61,992		769,986		100.0	%		100.0	%
Crossways Commerce Center I		1	BP	Chesapeake		324,350		1,876,207		100.0	%		100.0	%
Crossways Commerce Center ll		2	BP	Chesapeake		147,736		1,530,558		100.0	%		100.0	%
Crossways I		1	BP	Chesapeake		143,398		1,558,696		85.1	%		85.1	%
Crossways II		1	BP	Chesapeake		85,099		906,140		89.8	%		89.8	%
1434 Crossways Boulevard		2	BP	Chesapeake		220,501		2,576,291		100.0	%		100.0	%
Stephanie Way		1	BP	Chesapeake		51,209		314,080		64.6	%		64.6	%

*Greenbrier*
Greenbrier Technology Center I		1	BP	Chesapeake		95,843		846,921		82.6	%		82.6	%
Greenbrier Technology Center II		1	BP	Chesapeake		79,684		670,674		99.0	%		99.0	%
Greenbrier Circle Corporate Center		2	BP	Chesapeake		229,163		2,201,741		89.6	%		89.6	%

*Chesapeake/Other*
1400 Cavalier Boulevard		3	MTI	Chesapeake		300,083		1,238,758		100.0	%		100.0	%
Diamond Hill Distribution Center		4	MTI	Chesapeake		712,550		2,945,947		94.8	%		94.8	%

*Hampton*
1000 Lucas Way		2	BP	Hampton		182,175		1,130,710		91.5	%		91.5	%
Enterprise Parkway		1	BP	Hampton		320,584		1,337,687		63.3	%		12.5	%

*Norfolk*
Norfolk Business Center		1	BP	Norfolk		90,682		811,187		97.6	%		97.6	%
Norfolk Commerce Park II		1	BP	Norfolk		128,147		989,705		74.2	%		74.2	%
Gateway II		1	BP	Norfolk		42,429		288,976		85.9	%		85.9	%


Total		26				3,215,625		21,994,264		90.6	%		85.6	%


Grand Total		53				4,976,633	$	32,939,099		90.4	%		86.4	%


¹		MTI = Multi-tenant industrial.

²		STI = Single-tenant industrial.

³		BP = Business Park.

⁴		Triple-net equivalent.

Quarterly Supplemental Disclosure
September 30, 2007

LAND AND PROPERTIES AVAILABLE FOR DEVELOPMENT OR REDEVELOPMENT
(unaudited, dollars in thousands)


	Developable		Square Feet Under						Estimated		Estimated
	Building		Development		Projected		Cost to		Date In		Stabilization		Expected
	Square Feet		/Redevelopment		Cost		Date		Service		Date		Return
MARYLAND

Assets Under Development/Redevelopment
Ammendale Commerce Center¹		75,747		75,747	$	2,700	$	84		Q1-2008		Q1-2009		9	%
Gateway 270 West¹		16,400		16,400		240		1		Q3-2008		Q1-2009		10	%
Snowden Center		4,500		4,500		1,000		100		Q1-2008		Q2-2008		12	%

		96,647		96,647		3,940		185


Additional Developable Land
Glenn Dale Business Center		200,000
4612 Navistar Drive		50,000

		250,000


Total		346,647


NORTHERN VIRGINIA

Assets Under Development/Redevelopment
Sterling Park Business Center		57,900		57,900		9,700		680		Q2-2008		Q1-2009		9	%
403/405 Glenn Drive¹		11,954		11,954		500		2		Q1-2008		Q3-2008		10	%
Linden Business Center¹		10,350		10,350		100		—		Q3-2008		Q3-2008		10	%
Gateway Centre¹		4,700		4,700		100		10		Q4-2007		Q2-2008		10	%

		84,904		84,904		10,400		692


Additional Developable Land
Sterling Park Business Center		392,100
Plaza 500		200,000
Linden Business Center		32,400

		624,500


Total		709,404


SOUTHERN VIRGINIA

Assets Under Development/Redevelopment
1400 Cavalier Boulevard		96,000		96,000		5,900		2,620		Q4-2007		Q2-2008		9	%
Enterprise Parkway¹		83,549		83,549		4,700		53		Q2-2008		Q3-2009		10	%
Crossways Commerce Center I		46,392		46,392		5,400		2,430		Q4-2007		Q2-2008		11	%

		225,941		225,941		16,000		5,103


Additional Developable Land
River’s Bend Center II		600,000
Chesterfield		35,700
Greenbrier		30,000
Norfolk Commerce Park II		17,500

		683,200


Total		909,141


Grand Total		1,965,192		407,492	$	30,340	$	5,980


¹		Redevelopment of existing structure.

²		Interest, taxes and other expenses of $0.5 million and $0.9 million associated with development efforts were capitalized during the three and nine months ended September 30, 2007, respectively.

Quarterly Supplemental Disclosure
September 30, 2007

TOP TEN TENANTS
(unaudited)


									Percentage of
									Total
									Annualized			Weighted
			Number						Rental			Average
			of		Total Leased		Total Annualized		Revenue -			Remaining
Ranking		Tenant	Leases		Square Feet		Rental Revenue¹		Cash Basis			Lease Years
	1	U.S. Government		27		729,255	$	8,002,126		8.3	%		3.1
	2	Engineering Solutions		1		236,082		2,993,520		3.1	%		9.5
	3	EDS		2		220,501		2,576,291		2.7	%		3.7
	4	FKI Logistex		1		215,085		1,852,988		1.9	%		9.0
	5	Lockheed Martin Corporation		8		148,940		1,704,378		1.8	%		3.8
	6	Sentara Healthcare		5		145,019		1,358,756		1.4	%		5.6
	7	Verizon Virginia, Inc.		6		92,829		1,317,343		1.4	%		4.8
	8	TDS Logisitics, Inc.		3		248,050		1,302,574		1.3	%		0.6
	9	State of MD — AOC		11		78,927		1,278,494		1.3	%		5.2
	10	First Data Corporation		1		117,336		1,238,622		1.3	%		1.2


		Subtotal Top 10 Tenants		65		2,232,024		23,625,092		24.5	%		4.5
		All Remaining Tenants		737		7,915,703		72,847,474		75.5	%		3.8


		Total / Weighted Average		802		10,147,727	$	96,472,566		100.0	%		3.7


¹		Annualized rental revenue is based on triple-net equivalent rental revenue as of September 30, 2007.

Tenant NAICS Classification by Total Annualized Rental Revenue

Quarterly Supplemental Disclosure
September 30, 2007

LEASE EXPIRATIONS
(unaudited)


			Gross Leased Area					Annualized Cash Rental Revenue
	Number of											Average
	Leases		Square		Percent					Percent of		Base Rent¹
	Expiring		Footage		of Total			Amount		Total		per Sq. Ft.
Year of Lease Expiration

MTM		11		24,371		0.2	%	$	264,475		0.3%	$	10.85
2007		52		540,762		5.3	%		4,750,520		4.9%		8.78
2008		145		1,368,659		13.5	%		12,202,283		12.6%		8.92
2009		152		1,761,966		17.4	%		15,717,589		16.3%		8.92
2010		134		1,409,394		13.9	%		14,529,772		15.1%		10.31
2011		122		2,265,599		22.3	%		18,516,365		19.2%		8.17
2012		92		800,152		7.9	%		9,132,719		9.5%		11.41
Thereafter		94		1,976,824		19.5	%		21,358,843		22.1%		10.80


Total		802		10,147,727		100.0	%	$	96,472,566		100.0%	$	9.51


¹		Triple-net equivalent.

Quarterly Supplemental Disclosure
September 30, 2007

LEASE EXPIRATIONS — CURRENT AND NEXT FOUR QUARTERS
(unaudited)


			Gross Leased Area					Annualized Cash Rental Revenue
	Number of												Average Base
	Leases		Square		Percent					Percent			Rent¹ per Sq.
	Expiring		Footage		of Total			Amount		of Total			Ft.
Quarter of Lease Expiration
2007 - Q3^2,3		4		41,011		2.9	%	$	439,730		3.4	%	$	10.72
2007 - Q4		48		499,751		35.0	%		4,310,790		33.1	%		8.63
2008 - Q1		30		210,200		14.8	%		2,076,233		15.9	%		9.88
2008 - Q2		36		501,214		35.1	%		4,301,525		33.1	%		8.58
2008 - Q3		40		174,299		12.2	%		1,882,836		14.5	%		10.80


Total		158		1,426,475		100.0	%	$	13,011,114		100.0	%	$	9.12


¹		Triple-net equivalent.

²		The Company treats leases that expire on the last day of the quarter as leased square footage since the tenant is contractually entitled to the space.

³		Of the 41,011 square feet of leases that expired on 9/30/2007, 6,400 square feet were renewed and 11,736 square feet were held over.

Quarterly Supplemental Disclosure
September 30, 2007

LEASING HISTORY BY ACQUISITION QUARTER¹
(unaudited)


	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			6/30/07			9/30/07

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	%		95.6	%		95.4	%
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	%		92.5	%		89.3	%
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	%		91.2	%		89.2	%
Q4-2004 Acquisitions											92.0	%		92.0	%		91.5	%		90.2	%		93.2	%		97.1	%		97.1	%		97.1	%		97.1	%		93.4	%		92.5	%		92.5	%
Q1-2005 Acquisitions														91.6	%		91.6	%		91.6	%		91.6	%		91.6	%		91.6	%		92.2	%		94.0	%		94.0	%		94.0	%		93.9	%
Q2-2005 Acquisitions																	97.4	%		97.3	%		95.6	%		95.6	%		95.6	%		93.8	%		95.5	%		95.5	%		95.5	%		94.4	%
Q3-2005 Acquisitions																				26.8	%		42.0	%		42.5	%		44.7	%		41.3	%		49.4	%		47.0	%		46.7	%		77.0	%
Q4-2005 Acquisitions																							94.5	%		94.5	%		90.3	%		89.9	%		89.9	%		94.0	%		90.0	%		91.5	%
Q1-2006 Acquisitions																										88.4	%		91.2	%		91.2	%		91.5	%		93.5	%		88.4	%		87.1	%
Q2-2006 Acquisitions																													83.4	%		91.7	%		89.2	%		93.4	%		92.0	%		88.8	%
Q3-2006 Acquisitions																																68.6	%		68.7	%		70.2	%		76.1	%		83.6	%
Q4-2006 Acquisitions																																			82.0	%		80.7	%		87.0	%		91.2	%
Q1-2007 Acquisitions																																						93.8	%		92.9	%		91.3	%
Q2-2007 Acquisitions																																									95.2	%		95.2	%

Total Portfolio		91.6	%		91.5	%		93.7	%		93.8	%		94.2	%		94.9	%		82.7	%		89.3	%		89.6	%		88.7	%		87.9	%		88.1	%		88.7	%		88.7	%		90.6	%


¹		Percentage leased excludes sold properties.

Quarterly Supplemental Disclosure
September 30, 2007

LEASING ANALYSIS
(unaudited)


	Three months ended			Nine months ended
Leasing Production¹	September 30, 2007			September 30, 2007
New and Renewal Leases
Square footage of new and renewal leases		570,529			1,657,454
Number of new and renewal leases commencing		49			163

Expired/Early Renewal/Terminated leases
Square footage of expired/early renewal leases		449,060			1,425,051
Square footage of terminated leases		61,999			141,469

Total — expired/early renewal/terminated leases		511,059			1,566,520


Signed in advance of existing lease expiration		—			3,610
Commencement of previous advance leases		1,766			1,766
Pre-Leasing²		—			7,500

Net Absorption		61,236			81,590

New Leases
New square footage		254,585			634,894
Number of new leases commencing		18			68
Rental Change — Cash³
New base rent	$	8.20		$	8.67
Percentage change in base rent		5.1	%		5.5	%
Rental Change — GAAP³
New base rent	$	8.67		$	9.88
Percentage change in base rent		8.2	%		16.6	%
Average capital cost per square foot⁴	$	7.74		$	11.59
Average downtime between leases (months)		20.7			14.4
Average lease term (months)		78.1			64.3

Renewal Leases
Square footage of renewal leases		315,944			1,022,560
Number of renewal leases commencing		31			95
Retention rate		70	%		72	%

Suburban MD		87	%		83	%
Northern VA		42	%		58	%
Southern VA		66	%		71	%

Rental Change — Cash
New base rent	$	9.30		$	9.30
Expiring base rent	$	8.99		$	8.90
Percentage change in base rent		3.5	%		4.5	%
Rental Change — GAAP
New base rent	$	9.74		$	9.72
Expiring base rent	$	8.76		$	8.87
Percentage change in base rent		11.2	%		9.6	%

Average capital cost per square foot	$	2.18		$	2.31
Average lease term (months)		49.3			42.8


¹		Includes 220,656 square feet of leases and associated costs for leases signed in Q3 2007, of which, 86,067 square feet will commence in Q4 2007 and 134,589 square feet will commence in Q1 2008.

²		Pre-leasing at Crossways Commerce Center; estimated construction completion in Q4 2007. A total of 22,500 square feet of pre-leasing will commence in Q4 2007.

³		Quarter lease comparison based on seven leases totaling 42,659 square feet.

⁴		Includes first and second generation TI costs.

Quarterly Supplemental Disclosure
September 30, 2007

PORTFOLIO BY SIZE
(unaudited)


										% of
Square Feet Under	Number				% of Total			Annualized Base		Annualized			Revenue per
Lease	of Leases		Leased Square Feet		Square Feet			Rent¹		Rent			SF
0-4,999		379		926,260		9.1	%	$	10,930,285		11.3	%	$	11.80
5,000-9,999		170		1,189,942		11.7	%		12,819,485		13.3	%		10.77
10,000-14,999		88		1,055,888		10.4	%		11,482,973		11.9	%		10.88
15,000-19,999		42		707,975		7.0	%		6,749,116		7.0	%		9.53
20,000-24,999		27		600,814		5.9	%		6,172,013		6.4	%		10.27
25,000-29,999		20		536,008		5.3	%		7,074,042		7.3	%		13.20
30,000-34,999		18		580,936		5.7	%		4,718,351		4.9	%		8.12
35,000-39,999		11		403,927		4.0	%		2,881,420		3.0	%		7.13
40,000-44,999		6		249,770		2.5	%		2,320,285		2.4	%		9.29
45,000-49,999		9		419,199		4.1	%		3,624,349		3.8	%		8.65
50,000-54,999		3		159,108		1.6	%		2,119,196		2.2	%		13.32
55,000-59,999		2		114,805		1.1	%		1,696,216		1.8	%		14.77
60,000-64,999		4		246,072		2.4	%		3,063,411		3.2	%		12.45
65,000-69,999		2		135,321		1.3	%		607,784		0.6	%		4.49
70,000-74,999		2		143,860		1.4	%		865,797		0.9	%		6.02
85,000-79,999		1		87,120		0.9	%		370,260		0.4	%		4.25
90,000-94,999		1		94,950		0.9	%		559,256		0.6	%		5.89
100,000-104,999		1		104,218		1.0	%		1,158,424		1.2	%		11.12
105,000-109,999		1		107,320		1.1	%		1,025,714		1.1	%		9.56
115,000-119,999		3		348,619		3.4	%		3,113,959		3.2	%		8.93
120,000-124,999		5		608,301		6.0	%		4,240,049		4.4	%		6.97
125,000-129,999		1		127,108		1.3	%		603,763		0.6	%		4.75
130,000-134,999		1		134,589		1.3	%		585,462		0.6	%		4.35
155,000-159,999		1		158,400		1.6	%		1,067,964		1.1	%		6.74
215,000-219,999		2		431,135		4.2	%		2,909,472		3.0	%		6.75
235,000-239,999		1		236,082		2.4	%		2,993,520		3.1	%		12.68
240,000-244,999		1		240,000		2.4	%		720,000		0.7	%		3.00



Total		802		10,147,727		100.0	%	$	96,472,566		100.0	%	$	9.51


¹		Triple-net equivalent.

Quarterly Supplemental Disclosure
September 30, 2007

MARKET CONCENTRATION
(unaudited)

Market Concentration by Square Footage


	Maryland									Northern VA			Southern VA									Total
	Baltimore			Suburban MD			Subtotal						Richmond			Norfolk			Subtotal
Single-tenant industrial		—			2.2	%		2.2	%		3.1	%		—			—			—			5.3	%
Multi-tenant industrial		—			5.8	%		5.8	%		10.6	%		5.7	%		9.0	%		14.7	%		31.1	%
Business Park		7.8	%		10.3	%		18.1	%		12.7	%		10.1	%		19.7	%		29.8	%		60.6	%
Office		—			1.2	%		1.2	%		—			—			—			—			1.2	%
Retail		—			1.8	%		1.8	%		—			—			—			—			1.8	%


Total		7.8	%		21.3	%		29.1	%		26.4	%		15.8	%		28.7	%		44.5	%		100.0	%

Market Concentration by Annualized Rent


	Maryland									Northern VA			Southern VA									Total
	Baltimore			Suburban MD			Subtotal						Richmond			Norfolk			Subtotal
Single-tenant industrial		—			2.2	%		2.2	%		4.2	%		—			—			—			6.4	%
Multi-tenant industrial		—			4.3	%		4.3	%		13.2	%		3.6	%		4.4	%		8.0	%		25.5	%
Business Park		9.1	%		13.7	%		22.8	%		15.7	%		7.7	%		18.5	%		26.2	%		64.7	%
Office		—			2.1	%		2.1	%		—			—			—			—			2.1	%
Retail		—			1.3	%		1.3	%		—			—			—			—			1.3	%


Total		9.1	%		23.6	%		32.7	%		33.1	%		11.3	%		22.9	%		34.2	%		100.0	%

Quarterly Supplemental Disclosure
September 30, 2007

PORTFOLIO ANALYSIS
(unaudited)

PORTFOLIO BY MARKET


													Percentage
											Annualized		of
	Number of				Percent			Percent			Base Rent¹ -		Annualized
	Buildings		Square Feet		Leased			Occupied			Cash Basis		Base Rent¹
Maryland		63		3,271,767		91.3	%		89.4	%	$	31,568,845		32.7	%
Baltimore		24		876,732		87.5	%		85.2	%		8,817,865		9.1	%
Suburban MD		39		2,395,035		92.7	%		90.9	%		22,750,980		23.6	%

Northern VA		48		2,951,475		90.2	%		89.5	%		31,964,622		33.1	%

Southern VA		53		4,976,633		90.4	%		86.4	%		32,939,099		34.2	%
Richmond		27		1,761,008		90.0	%		88.0	%		10,944,835		11.4	%
Norfolk		26		3,215,625		90.6	%		85.6	%		21,994,264		22.8	%

Total		164		11,199,875		90.6	%		88.1	%	$	96,472,566		100.0	%

PORTFOLIO BY PROPERTY TYPE


													Percentage
											Annualized		of
	Number of				Percent			Percent			Base Rent¹ -		Annualized
	Buildings		Square Feet		Leased			Occupied			Cash Basis		Base Rent¹
Single-tenant industrial		4		594,487		100.0	%		100.0	%	$	6,181,671		6.4	%
Multi-tenant industrial		27		3,483,996		94.4	%		93.9	%		24,574,525		25.5	%
Business Park		129		6,786,358		87.8	%		83.9	%		62,439,325		64.7	%
Office		3		133,684		84.7	%		84.7	%		2,023,219		2.1	%
Retail		1		201,350		96.6	%		96.6	%		1,253,826		1.3	%

Total		164		11,199,875		90.6	%		88.1	%	$	96,472,566		100.0	%

PORTFOLIO BY LEASE TYPE


					Percentage
	Number of				of Leased
	Leases		Square Feet²		Portfolio
Triple net		509		7,234,586		71.3	%
Industrial gross		101		795,218		7.8	%
Full service		192		2,117,923		20.9	%

Total		802		10,147,727		100.0	%


¹		Triple-net equivalent.

²		Does not include vacant and core factor space.

Quarterly Supplemental Disclosure
September 30, 2007

MARYLAND REGION
LEASE EXPIRATIONS
(unaudited)


								% of
	SF of							Annual			Base
Year of Lease	Expiring		% of			Annual Base		Base			Rent¹ per
Expiration	Leases		Total SF			Rent¹		Rent¹			SF
Vacant		285,762		8.7	%	$	—		—		$	—
MTM		4,200		0.1	%		105,096		0.3	%		25.02
2007		132,370		4.1	%		1,294,685		4.1	%		9.78
2008		361,324		11.1	%		4,122,398		13.1	%		11.41
2009		495,168		15.1	%		4,810,717		15.2	%		9.72
2010		502,880		15.4	%		4,634,046		14.7	%		9.22
2011		459,119		14.0	%		4,102,808		13.0	%		8.94
2012		346,225		10.6	%		4,552,792		14.4	%		13.15
2015		641,639		19.6	%		7,585,375		24.0	%		11.82
2018		43,080		1.3	%		360,928		1.2	%		8.38


Total		3,271,767		100.0	%	$	31,568,845		100.0	%	$	10.57


¹		Triple-net equivalent.

Quarterly Supplemental Disclosure
September 30, 2007

NORTHERN VIRGINIA REGION
LEASE EXPIRATIONS
(unaudited)


								% of
	SF of							Annual			Base
Year of Lease	Expiring		% of			Annual Base		Base			Rent¹ per
Expiration	Leases		Total SF			Rent¹		Rent¹			SF
Vacant		288,822		9.8	%	$	—		—		$	—
MTM		4,500		0.2	%		47,031		0.1	%		10.45
2007		214,840		7.3	%		2,213,529		6.9	%		10.30
2008		247,925		8.4	%		2,617,663		8.2	%		10.56
2009		443,912		15.0	%		4,993,755		15.6	%		11.25
2010		504,275		17.1	%		6,254,903		19.6	%		12.40
2011		317,106		10.7	%		3,992,678		12.5	%		12.59
2012		227,069		7.7	%		2,392,783		7.5	%		10.54
2013		185,033		6.3	%		3,374,196		10.6	%		18.24
2014		151,182		5.1	%		1,246,143		3.9	%		8.24
2015		84,881		2.9	%		906,505		2.8	%		10.68
2016		45,848		1.5	%		931,916		2.9	%		20.33
2017		236,082		8.0	%		2,993,520		9.4	%		12.68



Total		2,951,475		100.0	%	$	31,964,622		100.0	%	$	10.83


¹		Triple-net equivalent.

Quarterly Supplemental Disclosure
September 30, 2007

SOUTHERN VIRGINIA REGION
LEASE EXPIRATIONS
(unaudited)


	SF of							% of
Year of Lease	Expiring		% of			Annual Base		Annual			Base Rent¹
Expiration	Leases		Total SF			Rent¹		Base Rent¹			per SF
Vacant		477,564		9.6	%	$	—		—		$	—
MTM		15,671		0.3	%		112,348		0.3	%		7.17
2007		193,552		3.9	%		1,242,306		3.8	%		6.42
2008		759,410		15.3	%		5,462,221		16.6	%		7.11
2009		822,886		16.5	%		5,913,117		18.0	%		7.19
2010		402,239		8.1	%		3,640,823		11.1	%		9.05
2011		1,489,374		29.9	%		10,420,879		31.6	%		7.00
2012		226,858		4.6	%		2,187,145		6.6	%		9.64
2013		113,853		2.3	%		1,226,070		3.7	%		10.77
2014		84,961		1.7	%		690,396		2.1	%		8.13
2015		51,241		1.0	%		372,722		1.1	%		7.27
2016		134,589		2.7	%		585,463		1.8	%		4.35
2017		204,435		4.1	%		1,085,609		3.3	%		5.31



Total		4,976,633		100.0	%	$	32,939,099		100.0	%	$	7.32


¹		Triple-net equivalent.

Quarterly Supplemental Disclosure
September 30, 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.

The Company believes FFO, NOI, EBITDA and AFFO are appropriate 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 measure of the Company’s property 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 property and operating performance when compared to other REITs since NOI is generally recognized as a standard measure of property performance in the real estate industry.

However, NOI should not be viewed as a measure of the Company’s overall 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 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.

FFO

Management believes that FFO is a useful measure of the Company’s operating performance. The Company computes FFO as defined by the National Association of Real Estate Investment Trusts, or NAREIT, which states FFO should represent 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. Further, 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.

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 and redevelopment 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.

First Potomac Realty Trust (FPO) Inactive 8-KFirst Potomac Realty Trust Reports Third Quarter 2007 Results