First Potomac Realty Trust (FPO) 8-K First Potomac Realty Trust Reports First Quarter 2008 Results

Exhibit 99.2

First Quarter 2008 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, 2008

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
Top Ten Tenants		13
Portfolio Analysis		14
Market Concentration		15
Lease Expirations		16
Lease Expirations — Current and Next Four Quarters		17
Portfolio by Size		18
Land and Properties Available for Development or Redevelopment		19
Leasing Analysis		20
Maryland Region		21
Maryland Region — Lease Expirations		22
Nothern Virginia Region		23
Northern Virginia Region — Lease Expirations		24
Southern Virginia Region		25
Southern Virginia Region — Lease Expirations		26
Management Statements on Non-GAAP Supplemental Measures		27

TOC

Quarterly Supplemental Disclosure
March 31, 2008

Company Information

First Potomac Realty Trust is a self-managed, self-administered real estate investment trust that focuses on owning, developing, redeveloping 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.

2

Quarterly Supplemental Disclosure
March 31, 2008

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

	Three Months Ended
	March 31, 2008					December 31, 2007					September 30, 2007					June 30, 2007					March 31, 2007
OPERATING REVENUES
Rental	$	25,860		81.9	%	$	26,401		81.7	%	$	26,109		83.5	%	$	25,794		83.7	%	$	24,920			82.6	%
Tenant reimbursements and other		5,725		18.1	%		5,921		18.3	%		5,160		16.5	%		5,015		16.3	%		5,250			17.4	%
																				��
		31,585		100.0	%		32,322		100.0	%		31,269		100.0	%		30,809		100.0	%		30,170			100.0	%
PROPERTY EXPENSES
Property operating		7,073		22.4	%		6,482		20.1	%		6,813		21.8	%		6,288		20.4	%		6,752			22.4	%
Real estate taxes and insurance		3,027		9.6	%		2,810		8.7	%		2,933		9.3	%		2,829		9.2	%		2,634			8.7	%
NET OPERATING INCOME		21,485		68.0	%		23,030		71.2	%		21,523		68.9	%		21,692		70.4	%		20,784			68.9	%
OTHER INCOME (EXPENSE)
General and administrative		(2,701	)	8.6	%		(2,504	)	7.7	%		(2,362	)	7.6	%		(2,621	)	8.5	%		(2,966	)		9.8	%
Interest and other income		131		0.4	%		196		0.6	%		123		0.4	%		172		0.6	%		194			0.6	%
EBITDA		18,915		59.8	%		20,722		64.1	%		19,284		61.7	%		19,243		62.5	%		18,012			59.7	%
Depreciation and amortization		(9,520	)				(10,865	)				(9,915	)				(10,392	)				(9,948	)
Interest expense		(9,131	)				(9,327	)				(9,137	)				(8,835	)				(8,289	)
Gain on early retirement of debt		2,112					—					—					—					—
Income (loss) from continuing operations before minority interests		2,376					530					232					16					(225	)
Minority interests		(74	)				(17	)				(7	)				—					5
																								��
NET INCOME (LOSS)	$	2,302				$	513				$	225				$	16				$	(220	)

3

Quarterly Supplemental Disclosure
March 31, 2008

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

	Three Months Ended
	March 31, 2008			December 31, 2007			September 30, 2007			June 30, 2007			March 31, 2007
FUNDS FROM OPERATIONS (“FFO”)
Net income (loss)	$	2,302		$	513		$	225		$	16		$	(220	)
Add back:
Depreciation & amortization of real estate assets1		9,520			10,865			9,915			10,392			9,948
Minority interests		74			17			7			—			(5	)
FFO	$	11,896		$	11,395		$	10,147		$	10,408		$	9,723
ADJUSTED FUNDS FROM OPERATIONS (“AFFO”)
FFO	$	11,896		$	11,395		$	10,147		$	10,408		$	9,723
Non-cash stock-based compensation		383			306			408			401			314
Gain on early retirement of debt		(2,112	)		—			—			—			—
Straight-line rent, net2		(230	)		(27	)		(43	)		(113	)		(263	)
Deferred market rent		(449	)		(425	)		(412	)		(453	)		(434	)
Non-real estate depreciation1		226			192			196			175			198
Debt fair value amortization		(780	)		(806	)		(799	)		(781	)		(755	)
Amortization of finance costs		321			310			323			232			260
Amortization of discounts		135			141			141			141			141
Tenant improvements3		(917	)		(1,544	)		(1,601	)		(1,057	)		(711	)
Leasing commissions3		(587	)		(594	)		(845	)		(561	)		(859	)
Capital expenditures3		(162	)		(445	)		(528	)		(593	)		(620	)
AFFO	$	7,724		$	8,503		$	6,987		$	7,799		$	6,994
Total weighted average shares and OP units:
Basic		24,882			24,883			24,880			24,804			24,847
Diluted		24,920			24,996			25,004			25,004			25,093
FFO per share:
FFO per share and unit — basic and diluted	$	0.48		$	0.46		$	0.41		$	0.42		$	0.39
AFFO per share:
AFFO per share and unit — basic and diluted	$	0.31		$	0.34		$	0.28		$	0.31		$	0.28

1	Most 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, development and redevelopment costs have been excluded from the calculation of AFFO:

First-generation costs
Tenant improvements	$	2,233	$	1,322	$	1,322	$	1,375	$	624
Leasing commissions		295		455		468		347		259
Capital expenditures		953		2,662		2,430		1,434		1,146
Development		2,255		3,695		2,825		2,003		2,807
Redevelopment		227		371		245		38		—
	$	5,963	$	8,505	$	7,290	$	5,197	$	4,836

4

Quarterly Supplemental Disclosure
March 31, 2008

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

	Three Months Ended March 31,
	2008			2007
Total base rent	$	23,629		$	23,994
Tenant reimbursement and other		4,864			5,027
Property operating expenses		(6,034	)		(6,400	)
Real estate taxes and insurance		(2,805	)		(2,546	)
Same-property1NOI — accrual basis		19,654			20,075
Straight-line revenue, net		(382	)		(240	)
Deferred market rental revenue		(393	)		(451	)
Same-property1NOI — cash basis	$	18,879		$	19,384
Change in same-property NOI — accrual basis		-2.1	%
Change in same-property NOI — cash basis		-2.6	%
Change in Same Property NOI — accrual basis
Rental revenue decrease	$	(6	)
Tenant reimbursement and other decrease		(163	)
Occupancy decrease		(359	)
Expense decrease		107
	$	(421	)
Same property percentage of total portfolio (sf)		89.6	%

Analysis of Same Property NOI

	Three Months Ended March 31,
	2008			2007
Total revenues	$	31,585		$	30,170
Property operating expenses		(7,073	)		(6,752	)
Real estate taxes and insurance		(3,027	)		(2,634	)
NOI		21,485			20,784
Less: Non-same property NOI		(1,831	)		(709	)
Same-property1NOI — accrual basis		19,654			20,075
Straight-line revenue, net		(382	)		(240	)
Deferred market rental revenue		(393	)		(451	)
Same-property1NOI — cash basis	$	18,879		$	19,384
Change in same-property NOI — accrual basis		-2.1	%
Change in same-property NOI — cash basis		-2.6	%

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: Crossways Commerce Center (Expansion), John Marshall Highway (Building II), Greenbrier Circle Corporate Center, Greenbrier Technology Center I, Pine Glen, Ammendale Commerce Center, River’s Bend Center II and Annapolis Commerce Park East.

5

Quarterly Supplemental Disclosure
March 31, 2008

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

	March 31, 2008			December 31, 2007
	(unaudited)
Assets
Rental property, net	$	979,129		$	977,106
Cash and cash equivalents		4,363			5,198
Escrows and reserves		13,862			13,360
Accounts and other receivables, net of allowance for doubtful accounts of $744 and $700, respectively		4,411			4,365
Accrued straight-line rents, net of allowance for doubtful accounts of $51 and $43, respectively		7,211			6,638
Deferred costs, net		12,679			12,377
Prepaid expenses and other assets		6,443			6,525
Intangible assets, net		24,371			26,730
Total assets	$	1,052,469		$	1,052,299
Liabilities
Mortgage loans	$	379,406		$	390,072
Exchangeable senior notes, net of discount		109,414			122,797
Senior notes		75,000			75,000
Secured term loan		50,000			50,000
Unsecured revolving credit facility		66,100			38,600
Accounts payable and accrued expenses		13,088			11,450
Accrued interest		5,088			2,776
Rents received in advance		4,349			4,709
Tenant security deposits		5,227			5,422
Deferred market rent		8,504			9,117
Total liabilities		716,176			709,943
Minority interest (redemption value $11,995 and $13,957, respectively)		10,986			11,545
Shareholders’ Equity
Common shares, $0.001 par value, 100,000 common shares authorized; 24,458 and 24,251 shares issued and outstanding, respectively		24			24
Additional paid-in capital		430,611			429,870
Accumulated other comprehensive loss		(296	)			—
Dividends in excess of accumulated earnings		(105,032	)		(99,083	)
Total shareholders’ equity		325,307			330,811
Total liabilities and shareholders’ equity	$	1,052,469		$	1,052,299

6

Quarterly Supplemental Disclosure
March 31, 2008

TOTAL MARKET CAPITALIZATION
(unaudited, dollars in thousands)

			Percent of
			Total Market
			Capitalization
Total common shares outstanding		24,458
Operating Partnership (“OP”) units held by third parties		780
Total common shares and OP units		25,238
Market price at March 31, 2008	$	15.37
Total equity capitalization	$	387,908		36.3	%
Debt capitalization
Fixed-rate debt	$	563,820		52.8	%
Floating-rate debt1		116,100		10.9	%
Total debt capitalization	$	679,920		63.7	%
Total market capitalization	$	1,067,828		100.0	%

¹ In January 2008, the Company entered into an interest rate swap agreement to fix the underlying interest rate on its $50 million term loan to 2.71%, plus a spread of 0.70% to 1.25%.

7

Quarterly Supplemental Disclosure
March 31, 2008

SELECTED OPERATING RATIOS
(unaudited, dollars in thousands)

	Three Months Ended
	March 31, 2008			December 31, 2007			September 30, 2007			June 30, 2007			March 31, 2007
COVERAGE RATIO
Interest Coverage Ratio
EBITDA	$	18,915		$	20,722		$	19,284		$	19,243		$	18,012
Interest Expense		9,131			9,327			9,137			8,835			8,289
		2.07	x		2.22	x		2.11	x		2.18	x		2.17	x
OVERHEAD RATIO
G&A to Real Estate Revenues
General and Administrative Expense	$	2,701		$	2,504		$	2,362		$	2,621		$	2,966
Real Estate Revenues		31,585			32,322			31,269			30,809			30,170
		8.6	%		7.7	%		7.6	%		8.5	%		9.8	%
LEVERAGE RATIO
Debt/Total Market Capitalization
Total Debt	$	679,920		$	676,469		$	664,976		$	655,800		$	613,711
Total Market Capitalization		1,067,828			1,109,722			1,211,240			1,239,051			1,324,847
		63.7	%		61.0	%		54.9	%		52.9	%		46.3	%

8

Quarterly Supplemental Disclosure
March 31, 2008

OUTSTANDING DEBT
(unaudited, dollars in thousands)

	Effective			Principal Balance		Annualized Debt		Maturity		Balance at
Encumbered Properties	Interest Rate			March 31, 2008		Service		Date		Maturity
Fixed Rate Debt
Norfolk Commerce Park II1		5.28	%	$	7,125	$	648		8/7/2008	$	7,034
Deer Park Center1,2 6900 English Muffin Way1,2 Gateway Center1,2 Gateway West1,2 4451 Georgia Pacific Boulevard1,2 20270 Goldenrod Lane1,2 15 Worman’s Mills Court1,2
Girard Business Center1,2		5.54	%		72,953		6,434		9/11/2008		71,825
Girard Place1,2 Old Courthouse Square1,2 Patrick Center1,2 7561 Lindbergh Drive1,2 West Park1,2 Woodlands Business Center1,2
Glenn Dale Business Center1		5.13	%		8,411		780		5/1/2009		8,033
4200 Tech Court2		8.07	%		1,745		168		10/1/2009		1,705
Park Central I1		5.66	%		4,933		519		11/1/2009		4,523
4212 Tech Court		8.53	%		1,705		169		6/1/2010		1,654
Park Central II1		5.66	%		6,124		638		11/1/2010		5,289
Enterprise Center1,2		5.20	%		18,606		1,647		12/1/2010		16,712
Indian Creek Court1,2		5.90	%		13,105		1,162		1/1/2011		11,982
403/405 Glenn Drive1		5.50	%		8,725		746		7/1/2011		7,807
4612 Navistar Drive1,2		5.20	%		13,459		1,131		7/11/2011		11,921
Campus at Metro Park1,2		5.25	%		24,712		2,028		2/11/2012		21,581
1434 Crossways Boulevard Building II1		5.38	%		10,452		826		8/5/2012		8,866
Crossways Commerce Center		6.70	%		25,285		2,087		10/1/2012		23,313
Newington Business Park Center		6.70	%		15,950		1,316		10/1/2012		14,706
Prosperity Business Center1		5.75	%		3,835		332		1/1/2013		3,242
Aquia Commerce Center I		7.28	%		697		165		2/1/2013		42
1434 Crossways Boulevard Building I1		5.38	%		8,931		665		3/5/2013		7,597
Linden Business Center1		5.58	%		7,481		559		10/1/2013		6,596
Owings Mills Business Center1		5.75	%		5,719		425		3/1/2014		5,066
Annapolis Commerce Park East1		6.25	%		8,808		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		92,223
Greenbrier Technology Center II Norfolk Business Center Alexandria Corporate Park
Hanover Business Center
Hanover Building D1		6.63	%		937		161		8/1/2015		13
Hanover Building C1		6.63	%		1,335		186		12/1/2017		13
Chesterfield Business Center
Chesterfield Buildings C, D, G and H1		6.63	%		2,438		414		8/1/2015		34
Chesterfield Buildings A, B, E and F1		6.63	%		2,796		318		6/1/2021		26
Gateway Centre Building I1		5.88	%		1,614		239		11/1/2016		—
Airpark Business Center1		6.63	%		1,525		173		6/1/2021		14
				$	379,406	$	29,791			$	339,827
Convertible Debt
Exchangeable Senior Notes3		4.45	%	$	109,414	$	5,000		12/15/2011	$	111,250
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				$	563,820	$	39,651			$	526,077

9

Quarterly Supplemental Disclosure
March 31, 2008

OUTSTANDING DEBT CONTINUED

(unaudited, dollars in thousands)

		Principal
	Effective	Balance March 31,		Annualized		Maturity		Balance at
	Interest Rate	2008		Debt Service		Date		Maturity
Floating Rate Debt
Secured Term Loan4	LIBOR + 1.10%		50,000		1,902		8/7/2010		50,000
Unsecured Revolving Credit Facility5,6	LIBOR + 1.20%		66,100		2,580		4/26/2010		66,100
Total at March 31, 2008		$	679,920	$	44,133			$	642,177

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, 2008 and actual interest rates are:

	Fair Value			Contractual
Property	Impact			Interest Rate
Deer Park through Woodlands Business Center	$	389			6.71	%
Norfolk Commerce Park II		38			6.90	%
4612 Navistar Drive		874			7.48	%
Campus at Metro Park		1,531			7.11	%
Enterprise Center		1,216			8.03	%
Glenn Dale Business Center		233			7.83	%
Gateway Centre Building I		84			7.35	%
1434 Crossways Boulevard Building I		531			6.25	%
1434 Crossways Boulevard Building II		836			7.05	%
403 and 405 Glenn Drive		507			7.60	%
Linden Business Center		146			6.01	%
Owings Mills Business Center		28			5.85	%
Prosperity Business Center		60			6.25	%
Airpark Business Center		68			7.45	%
Hanover Building C		69			7.88	%
Hanover Building D		67			8.88	%
Chesterfield Buildings A, B, E and F		125			7.45	%
Chesterfield Buildings C, D, G and H		148			8.50	%
Indian Creek Court		598			7.80	%
Park Central I		166			8.00	%
Park Central II		364			8.32	%
Annapolis Commerce Park East		(226	)		5.74	%
Total fair value increase	$	7,852

2	The maturity date on these loans represents the anticipated repayment date of the loans, after which the interest rates on the loans increase.
3	In early March 2008, the Company repurchased $13.75 million of its 4.0% Exchangeable Senior Notes.
4	In January 2008, the Company entered into a $50 million interest rate swap to hedge its interest rate exposure. The interest rate swap fixes the Company’s underlying interest rate on a $50 million notional balance at 2.71% plus a spread of 0.70% to 1.25% (depending on the Company’s overall leverage level), for a total rate range from 3.41% to 3.96%. The interest rate swap expires in August 2010, concurrent with the maturity of the Company’s $50 million term loan. At March 31, 2008, the effective interest rate on the $50 million notional balance was 3.8%.
5	As of March 31, 2008, 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, Cavalier Industrial Park, Gateway Centre (Building II), 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, 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.
6	At March 31, 2008, the effective interest rate on the Company’s unsecured revolving credit facility was 3.9%.

10

Quarterly Supplemental Disclosure
March 31, 2008

NET ASSET VALUE ANALYSIS

(unaudited, in thousands)

	Three Months Ended
	March 31, 2008			Annualized
Income Statement Items
Total Portfolio In-Place Cash NOI
Total GAAP Revenue	$	31,585		$	126,340
Straight-line and Deferred Market Rents		(1,039	)		(4,156	)
Management Fee Adjustment		498			1,992
Property Operating Costs		(9,993	)		(39,972	)
Total Portfolio In-Place Cash NOI	$	21,051		$	84,204
Total Portfolio Cash NOI @ 94% Occupancy
Total Revenue	$	35,838		$	143,352
Straight-line and Deferred Market Rents		(1,418	)		(5,672	)
Property Operating Costs		(10,295	)		(41,180	)
Total Portfolio Cash NOI	$	24,125		$	96,500
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		1,414
Original Cost Basis of Redevelopment Assets1		4,610
Construction In Progress		19,412
Total Land for Future Development & CIP	$	43,946
Current Quarter Acquisitions
Cost Basis of current quarter acquisitions	$	—
Total Current Quarter Acquisitions	$	—
Select Balance Sheet Items
Cash and cash equivalents, escrows and reserves	$	18,225
Accounts and other receivables, net of allowance		4,411
Prepaid expenses and other assets		6,443
Accounts payable and accrued expenses		(13,088	)
Accrued interest		(5,088	)
Rents received in advance		(4,349	)
Tenant security deposits		(5,227	)
Mortgage and Senior Debt, cash principal balances		(672,068	)
Total	$	(670,741	)

¹ Represents portion of original purchase under redevelopment.

11

Quarterly Supplemental Disclosure
March 31, 2008

DEBT MATURITY SCHEDULE

(unaudited)

12

Quarterly Supplemental Disclosure
March 31, 2008

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		26		631,819	$	7,281,907		7.6	%		3.1
	2	Engineering Solutions		1		236,082		2,993,520		3.1	%		9.0
	3	EDS		2		220,501		2,576,291		2.7	%		3.2
	4	Sentara Healthcare		7		234,062		2,064,850		2.1	%		6.0
	5	FKI Logistex		1		215,085		1,852,988		1.9	%		8.5
	6	Lockheed Martin Corporation		8		144,790		1,712,548		1.8	%		3.3
	7	State of Maryland		11		79,012		1,359,232		1.4	%		4.5
	8	Verizon Virginia, Inc.		6		92,829		1,326,553		1.4	%		4.3
	9	First Data Corporation		1		117,336		1,290,696		1.3	%		5.7
	10	Montgomery County		2		57,825		1,255,762		1.3	%		7.2
		Subtotal Top 10 Tenants		65		2,029,341		23,714,347		24.6	%		4.9
		All Remaining Tenants		738		7,829,423		72,490,275		75.4	%		3.9
		Total / Weighted Average		803		9,858,764	$	96,204,622		100.0	%		3.8

¹ Annualized rental revenue is based on triple-net equivalent cash basis rental revenue as of March 31, 2008.

13

Quarterly Supplemental Disclosure
March 31, 2008

PORTFOLIO ANALYSIS
(unaudited)

PORTFOLIO BY MARKET

													Percentage
											Annualized		of
	Number of				Percent			Percent			Base Rent1 -		Annualized
	Buildings		Square Feet		Leased			Occupied			Cash Basis		Base Rent
Maryland		63		3,234,038		90.0	%		89.2	%	$	31,600,861		32.8	%
Baltimore		24		876,830		85.7	%		83.2	%		9,137,893		9.5	%
Suburban MD		39		2,357,208		91.6	%		91.5	%		22,462,968		23.3	%
Northern VA		48		2,973,671		87.3	%		85.5	%		31,489,090		32.7	%
Southern VA		53		5,015,670		86.8	%		83.4	%		33,114,671		34.5	%
Richmond		27		1,761,013		90.7	%		88.7	%		11,161,209		11.6	%
Norfolk		26		3,254,657		84.6	%		80.5	%		21,953,462		22.9	%
Total		164		11,223,379		87.8	%		85.6	%	$	96,204,622		100.0	%

PORTFOLIO BY PROPERTY TYPE

													Percentage
											Annualized		of
	Number of				Percent			Percent			Base Rent1 -		Annualized
	Buildings		Square Feet		Leased			Occupied			Cash Basis		Base Rent
Industrial		31		4,073,004		87.3	%		86.7	%	$	28,716,335		29.8	%
Business Park		127		6,713,909		88.0	%		84.7	%		62,815,719		65.3	%
Office		5		235,116		89.5	%		89.5	%		3,515,583		3.7	%
Retail		1		201,350		91.8	%		91.8	%		1,156,985		1.2	%
Total		164		11,223,379		87.8	%		85.6	%	$	96,204,622		100.0	%

PORTFOLIO BY LEASE TYPE

					Percentage
	Number of				of Leased
	Leases		Square Feet2		Portfolio
Triple net		524		7,099,677		72.0	%
Industrial gross		82		704,103		7.2	%
Full service		197		2,054,984		20.8	%
Total		803		9,858,764		100.0	%

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

14

Quarterly Supplemental Disclosure
March 31, 2008

MARKET CONCENTRATION
(unaudited)

Market Concentration by Square Footage

	Maryland									Northern VA			Southern VA
	Baltimore			Suburban MD			Subtotal						Richmond			Norfolk			Subtotal			Total
Industrial		—			8.1	%		8.1	%		13.7	%		5.7	%		9.1	%		14.8	%		36.6	%
Business Park		7.0	%		10.1	%		17.1	%		13.0	%		10.1	%		20.2	%		30.3	%		60.4	%
Office		—			1.2	%		1.2	%		—			—			—			—			1.2	%
Retail		—			1.8	%		1.8	%		—			—			—			—			1.8	%
Total		7.0	%		21.2	%		28.2	%		26.7	%		15.8	%		29.3	%		45.1	%		100.0	%

Market Concentration by Annualized Rent

	Maryland									Northern VA			Southern VA
	Baltimore			Suburban MD			Subtotal						Richmond			Norfolk			Subtotal			Total
Industrial		—			6.6	%		6.6	%		16.8	%		3.6	%		3.3	%		6.9	%		30.3	%
Business Park		8.0	%		13.9	%		21.9	%		16.5	%		8.2	%		19.9	%		28.1	%		66.5	%
Office		—			2.0	%		2.0	%		—			—			—			—			2.0	%
Retail		—			1.2	%		1.2	%		—			—			—			—			1.2	%
Total		8.0	%		23.7	%		31.7	%		33.3	%		11.8	%		23.2	%		35.0	%		100.0	%

15

Quarterly Supplemental Disclosure
March 31, 2008

LEASE EXPIRATIONS
(unaudited)

			Gross Leased Area					Annualized Cash Rental Revenue
	Number of												Average
	Leases		Square		Percent					Percent of			Base Rent
	Expiring		Footage		of Total			Amount		Total			per Sq. Ft.1
Year of Lease Expiration
MTM		9		81,287		0.8	%	$	1,025,675		1.1	%	$	12.62
2008		124		912,157		9.3	%		8,009,636		8.3	%		8.78
2009		145		1,623,622		16.5	%		14,402,177		15.0	%		8.87
2010		139		1,441,618		14.6	%		14,725,664		15.3	%		10.21
2011		140		2,174,707		22.1	%		18,547,962		19.3	%		8.53
2012		98		834,958		8.5	%		9,577,977		10.0	%		11.47
2013		55		821,377		8.3	%		9,913,562		10.3	%		12.07
Thereafter		93		1,969,038		19.9	%		20,001,969		20.7	%		10.16
Total		803		9,858,764		100.0	%	$	96,204,622		100.0	%	$	9.76

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. Of the 74,687 square feet of leases that expired on 3/31/2008, 26,650 square feet were renewed, 30,048 square feet were moved out and 17,989 square feet were heldover.

16

Quarterly Supplemental Disclosure
March 31, 2008

LEASE EXPIRATIONS — CURRENT AND NEXT FOUR QUARTERS
(unaudited)

			Gross Leased Area					Annualized Cash Rental Revenue
	Number of												Average Base
	Leases		Square		Percent					Percent of			Rent per Sq.
	Expiring		Footage		of Total			Amount		Total			Ft.1
Quarter of Lease Expiration
2008 - Q12		11		74,687		6.6	%	$	593,334		5.9	%	$	7.94
2008 - Q2		31		306,235		27.2	%		3,219,702		31.9	%		10.51
2008 - Q3		36		145,181		12.9	%		1,546,380		15.3	%		10.65
2008 - Q4		46		386,054		34.3	%		2,650,220		26.3	%		6.86
2009 - Q1		38		214,793		19.0	%		2,073,358		20.6	%		9.65
Total		162		1,126,950		100.0	%	$	10,082,994		100.0	%	$	8.95

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. Of the 74,687 square feet of leases that expired on 3/31/2008, 26,650 square feet were renewed, 30,048 square feet were moved out and 17,989 square feet were heldover.

17

Quarterly Supplemental Disclosure
March 31, 2008

PORTFOLIO BY SIZE
(unaudited)

										% of
Square Feet Under	Number		Leased Square		% of Total			Annualized Base		Annualized			Revenue per
Lease	of Leases		Feet		Square Feet			Rent1		Rent			SF
0-4,999		381		944,531		9.6	%	$	11,426,949		11.9	%	$	12.10
5,000-9,999		173		1,221,364		12.4	%		13,326,537		13.9	%		10.91
10,000-14,999		85		1,020,993		10.4	%		11,556,807		12.0	%		11.32
15,000-19,999		43		728,564		7.4	%		7,228,897		7.5	%		9.92
20,000-24,999		27		603,315		6.1	%		6,200,761		6.4	%		10.28
25,000-29,999		21		564,302		5.7	%		7,460,780		7.8	%		13.22
30,000-34,999		17		548,111		5.6	%		4,571,459		4.8	%		8.34
35,000-39,999		11		405,202		4.1	%		2,874,447		3.0	%		7.09
40,000-44,999		6		249,770		2.5	%		2,331,142		2.4	%		9.33
45,000-49,999		10		467,199		4.7	%		3,990,928		4.1	%		8.54
50,000-54,999		2		107,483		1.1	%		1,519,521		1.6	%		14.14
55,000-59,999		2		114,805		1.2	%		1,718,141		1.8	%		14.97
60,000-64,999		4		246,072		2.5	%		3,063,411		3.2	%		12.45
65,000-69,999		2		135,321		1.4	%		607,784		0.6	%		4.49
70,000-74,999		1		70,460		0.7	%		479,713		0.5	%		6.81
75,000-79,999		1		76,800		0.8	%		487,680		0.5	%		6.35
85,000-89,999		1		87,120		0.9	%		370,260		0.4	%		4.25
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		1.2	%		11.12
115,000-119,999		3		348,619		3.5	%		3,166,033		3.3	%		9.08
120,000-124,999		5		608,301		6.2	%		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		1.4	%		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		1		215,085		2.1	%		1,852,988		1.9	%		8.62
235,000-239,999		2		476,082		4.7	%		3,755,466		3.9	%		7.89
Total		803		9,858,764		100.0	%	$	96,204,622		100.0	%	$	9.76

¹ Triple-net equivalent.

18

Quarterly Supplemental Disclosure
March 31, 2008

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

			Square Feet
	Developable		Under						Estimated	Estimated
	Building		Development						Date In	Stabilization		Expected
	Square Feet		/Redevelopment		Projected Cost		Cost to Date		Service		Date	Return
MARYLAND
Assets Under Development/Redevelopment
Ammendale Business Park1		76,292		76,292	$	2,700	$	184	Q2-2008		Q1-2009		9	%
Gateway 2701		54,967		54,967		500		100	Q2-2008		Q1-2009		10	%
Snowden Center		4,500		4,500		1,000		643	Q2-2008		Q1-2009		12	%
		135,759		135,759		4,200		927
Additional Developable Land
Glenn Dale Business Center		200,000
4612 Navistar Drive		50,000
		250,000
Total		385,759
NORTHERN VIRGINIA
Assets Under Development/Redevelopment
Sterling Park Business Center		57,900		57,900		9,700		4,505	Q2-2008		Q1-2009		9	%
Additional Developable Land
Sterling Park Business Center		392,100
Plaza 500		200,000
Linden Business Center		32,400
		624,500
Total		682,400
SOUTHERN VIRGINIA
Assets Under Development/Redevelopment
Enterprise Parkway1		85,221		70,833		4,700		212	Q2-2008		Q3-2009		10	%
Additional Developable Land
River’s Bend Center		600,000
Chesterfield Business Center		35,700
Greenbrier Business Center		36,000
Norfolk Commerce Park		17,500
		689,200
Total		774,421
Grand Total		1,842,580		264,492	$	18,600	$	5,644

COMPLETED DEVELOPMENT OR REDEVELOPMENT PLACED IN SERVICE IN Q1 2008

	Completed		Square Feet		Total		Date Placed		Expected
	Square Feet		Not Placed in Service		Cost		In Service		Return
403/405 Glenn Drive1		12,744		—	$	461		Q1-2008		10	%
Enterprise Parkway		14,388		—		43		Q1-2008		10	%
Gateway Centre1		4,846		—		108		Q1-2008		10	%
		31,978		—	$	612

SUBSTANTIALLY COMPLETED DEVELOPMENT / REDEVELOPMENT TO BE PLACED IN SERVICE IN 2008

							Estimated
	Completed		Square Feet		Total		Date Placed		Expected
	Square Feet		Not Placed in Service		Cost		In Service		Return
Cavalier Industrial Park		96,000		96,000	$	5,900		Q4-2008		9	%
Crossways Commerce Center I2		44,912		22,412		5,100		Q4-2008		11	%
		140,912		118,412	$	11,000

1	Redevelopment of existing structure.
2	Pre-Leasing of 22,500 square feet has commenced and was placed into service as of November 12, 2007.

19

Quarterly Supplemental Disclosure
March 31, 2008

LEASING ANALYSIS
(unaudited)

	Three Months Ended
Leasing Production1	March 31, 2008
New and Renewal Leases
Square footage of new and renewal leases		939,505
Number of new and renewal leases commencing		76
Expired/Early Renewal/Terminated leases
Square footage of expired/early renewal leases		703,829
Square footage of terminated leases		118,289
Total — expired/early renewal/terminated leases		822,118
Signed in advance of existing tenant’s lease expiration		25,227
Commencement of previous advance leases		—
Pre-Leasing		—
Net Absorption		92,160
New Leases
New square footage		339,426
Number of new leases commencing		36
Rental Change — Cash2
New base rent	$	7.99
Percentage change in base rent		7.7	%
Rental Change — GAAP2
New base rent	$	9.10
Percentage change in base rent		23.4	%
Average capital cost per square foot3	$	5.85
Average downtime between leases (months)		7.7
Average lease term (months)		77.1
Renewal Leases
Square footage of renewal leases		600,079
Number of renewal leases commencing		40
Retention rate		85	%
Suburban MD		68	%
Northern VA		69	%
Southern VA		93	%
Rental Change — Cash
New base rent	$	9.74
Expiring base rent	$	9.20
Percentage change in base rent		5.9	%
Rental Change — GAAP
New base rent	$	10.19
Expiring base rent	$	9.36
Percentage change in base rent		8.8	%
Average capital cost per square foot	$	3.16
Average lease term (months)		56.7

1	Includes 211,440 square feet of leases and associated costs for leases signed in Q1 2008. Of the total, 211,440 square feet will commence in Q2 2008.
2	Quarter lease comparison based on 22 leases totaling 248,189 square feet.
3	Includes first and second generation TI costs.

20

Quarterly Supplemental Disclosure
March 31, 2008

MARYLAND REGION
(unaudited)

										Leased at			Occupied at
			Property			Square		Annualized Cash		March 31,			March 31,
Property	Buildings		Type1,2		Location	Footage		Basis Rent3		2008			2008
SUBURBAN MD
Frederick
15 Worman’s Mill Court		1	BP		Frederick		39,966	$	380,113		100.0	%		100.0	%
Frederick Industrial Park4		3		I	Frederick		550,545		4,156,139		97.3	%		97.3	%
Patrick Center		1	Office		Frederick		66,794		1,115,471		78.7	%		78.7	%
West Park		1	Office		Frederick		28,889		362,585		94.5	%		94.5	%
I-270 Corridor
20270 Goldenrod Lane		1	BP		Germantown		24,468		287,000		96.1	%		96.1	%
7561 Lindbergh Drive		1		I	Gaithersburg		36,000		318,733		100.0	%		100.0	%
Airpark Place		3	BP		Gaithersburg		82,178		707,650		66.6	%		66.6	%
Campus at Metro Park		4	BP		Rockville		190,238		3,909,469		100.0	%		100.0	%
Gateway 270		6	BP		Clarksburg		200,493		2,557,099		95.5	%		95.5	%
GatewayCenter		2	BP		Gaithersburg		44,307		624,707		96.5	%		96.5	%
Girard Business Park5		7	BP		Gaithersburg		298,961		2,565,537		89.4	%		89.4	%
Beltsville
Ammendale Business Park6		6	BP		Beltsville		239,062		2,131,286		70.0	%		68.6	%
Other
Glenn Dale Business Center		1		I	Glenn Dale		315,826		1,751,469		100.0	%		100.0	%
Old Courthouse Square		1	Retail		Martinsburg, WV		201,350		1,156,985		91.8	%		91.8	%
Woodlands Business Center		1	Office		Largo		38,131		438,725		79.8	%		79.8	%
Total		39					2,357,208		22,462,968		91.6	%		91.5	%
BALTIMORE
Owings Mills
Owings Mills Business Park7		6	BP		Owings Mills		219,812		2,503,410		93.5	%		84.4	%
Columbia
Rumsey Center		4	BP		Columbia		134,296		1,287,825		85.0	%		85.0	%
Snowden Center		4	BP		Columbia		140,188		1,604,914		78.8	%		77.2	%
Other
Deer Park		4	BP		Randallstown		171,125		1,100,333		78.6	%		78.6	%
Gateway West		4	BP		Westminster		110,107		1,042,610		79.2	%		79.2	%
Annapolis Commerce Park East		2	Office		Annapolis		101,302		1,598,801		98.8	%		98.8	%
Total		24					876,830		9,137,893		85.7	%		83.2	%
Grand Total		63					3,234,038	$	31,600,861		90.0	%		89.2	%

1	I =Industrial.
2	BP = Business Park.
3	Triple-net equivalent.
4	Frederick Industrial Park consists of the following properties: 4451 Georgia Pacific Boulevard, 4612 Navistar Drive and 6900 English Muffin Way.
5	Girard Business Park consists of the following properties: Girard Business Center and Girard Place.
6	Ammendale Business Park consists of the following properties: Ammendale Commerce Center and Indian Creek Court.
7	Owings Mills Business Park consists of the following properties: Owings Mills Business Center and Owings Mills Commerce Center.

21

Quarterly Supplemental Disclosure
March 31, 2008

MARYLAND REGION
LEASE EXPIRATIONS
(unaudited)

								% of
	SF of							Annual			Base
Year of Lease	Expiring		% of			Annual Base		Base			Rent1per
Expiration	Leases		Total SF			Rent1		Rent			SF
Vacant		322,411		10.0	%	$	—		—		$	—
MTM		37,293		1.2	%		677,179		2.1	%		18.16
2008		297,281		9.2	%		3,239,185		10.3	%		10.90
2009		409,333		12.7	%		3,687,243		11.7	%		9.01
2010		483,954		15.0	%		4,219,365		13.4	%		8.72
2011		481,534		14.9	%		4,353,281		13.8	%		9.04
2012		367,592		11.4	%		4,911,834		15.5	%		13.36
2013		92,519		2.9	%		1,162,750		3.7	%		12.57
2014		155,101		4.8	%		2,425,875		7.7	%		15.64
2015		158,180		4.9	%		2,825,324		8.9	%		17.86
2016		263,024		8.1	%		2,387,728		7.6	%		9.08
2017		74,559		2.2	%		1,050,783		3.3	%		14.09
2018+		91,257		2.7	%		660,314		2.0	%		7.24
Total		3,234,038		100.0	%	$	31,600,861		100.0	%	$	10.85

¹ Triple-net equivalent.

22

Quarterly Supplemental Disclosure
March 31, 2008

NORTHERN VIRGINIA REGION
(unaudited)

									Leased at			Occupied at
			Property		Square		Annualized Cash		March 31,			March 31,
Property	Buildings		Type1,2	Location	Footage		Basis Rent3		2008			2008
Alexandria
Alexandria Corporate Park		1	I	Alexandria		271,688	$	4,247,731		95.7	%		95.7	%
Interstate Plaza		1	I	Alexandria		109,081		—		0.0	%		0.0	%
Plaza 500		2	I	Alexandria		504,089		5,362,714		96.8	%		95.4	%
Manassas
Gateway Centre		3	BP	Manassas		100,559		842,863		74.1	%		66.3	%
Linden Business Center		3	BP	Manassas		109,118		881,755		60.6	%		60.6	%
Windsor at Battlefield		2	BP	Manassas		153,510		1,883,575		100.0	%		83.5	%
Reston/Herndon
Herndon Corporate Center		4	BP	Herndon		127,433		1,188,204		60.6	%		60.6	%
Van Buren Business Park		5	BP	Herndon		108,047		1,506,114		88.4	%		77.8	%
Reston Business Campus		4	BP	Reston		82,584		1,112,087		93.9	%		93.9	%
Sterling
Sterling Park Business Center4		5	BP	Sterling		379,085		3,373,994		87.9	%		87.9	%
Chantilly
Lafayette Business Park5		6	BP	Chantilly		252,308		3,102,865		80.9	%		80.9	%
Other
13129 Airpark Road		1	I	Culpeper		149,795		827,516		100.0	%		100.0	%
15395 John Marshall Highway		1	I	Haymarket		236,082		2,993,520		100.0	%		100.0	%
Newington Business Park Center		7	I	Lorton		254,242		2,457,430		95.5	%		95.5	%
Prosperity Business Center		1	BP	Merrifield		71,562		829,283		100.0	%		100.0	%
Aquia Commerce Center I & II		2	BP	Stafford		64,488		879,439		100.0	%		100.0	%
Total		48				2,973,671	$	31,489,090		87.3	%		85.5	%

1	I = Industrial.
2	BP = Business Park.
3	Triple-net equivalent.
4	Sterling Park Business Center consists of the following properties: 403/405 Glenn Drive, Davis Drive and Sterling Park Business Center.
5	Lafayette Business Park consists of the following properties: Enterprise Center and Tech Court.

23

Quarterly Supplemental Disclosure
March 31, 2008

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		Rent			SF
Vacant		378,959		12.7	%	$	—		—		$	—
MTM		33,044		1.1	%		287,835		0.9	%		8.71
2008		201,078		6.8	%		1,937,724		6.2	%		9.64
2009		441,199		14.8	%		5,032,895		16.0	%		11.41
2010		521,767		17.5	%		6,532,690		20.7	%		12.52
2011		340,472		11.4	%		4,305,809		13.7	%		12.65
2012		223,041		7.5	%		2,389,124		7.6	%		10.71
2013		268,023		9.0	%		4,304,190		13.7	%		16.06
2014		151,182		5.1	%		1,257,633		4.0	%		8.32
2015		132,976		4.5	%		1,506,543		4.8	%		11.33
2016		45,848		1.6	%		941,126		3.0	%		20.53
2017		236,082		8.0	%		2,993,521		9.4	%		12.68
Total		2,973,671		100.0	%	$	31,489,090		100.0	%	$	12.14

¹ Triple-net equivalent.

24

Quarterly Supplemental Disclosure
March 31, 2008

SOUTHERN VIRGINIA REGION
(unaudited)

							Annualized		Leased at			Occupied at
			Property		Square		Cash Basis		March 31,			March 31,
Property	Buildings		Type1,2	Location	Footage		Rent3		2008			2008
RICHMOND
North
Virginia Center		1	BP	Glen Allen		119,446	$	1,253,749		95.0	%		95.0	%
Northridge I, II		2	I	Ashland		140,390		670,672		83.3	%		83.3	%
Hanover Business Center		4	BP	Ashland		183,213		1,047,345		92.1	%		92.1	%
Park Central		3	BP	Richmond		204,280		2,026,486		87.5	%		87.5	%
South
River’s Bend Center4		6	I	Chester		795,037		4,156,447		89.9	%		87.0	%
Chesterfield Business Center5		11	BP	Richmond		318,647		2,006,510		95.6	%		91.9	%
Total		27				1,761,013		11,161,209		90.7	%		88.7	%
NORFOLK
Crossways
Crossways Commerce Center6		9	BP	Chesapeake		1,060,185		10,032,860		95.7	%		88.5	%
Greenbrier
Greenbrier Business Center7		4	BP	Chesapeake		404,811		3,791,259		91.1	%		85.1	%
Chesapeake
1400 Cavalier Boulevard		3	I	Chesapeake		300,083		1,241,469		100.0	%		100.0	%
Diamond Hill Distribution Center		4	I	Chesapeake		712,550		1,923,553		64.9	%		62.5	%
Hampton
1000 Lucas Way		2	BP	Hampton		182,175		1,153,995		91.5	%		91.5	%
Enterprise Parkway		1	BP	Hampton		333,150		1,640,463		65.3	%		61.0	%
Norfolk
Norfolk Commerce Park8		3	BP	Norfolk		261,703		2,169,864		85.8	%		85.0	%
Total		26				3,254,657		21,953,463		84.6	%		80.5	%
Grand Total		53				5,015,670	$	33,114,672		86.8	%		83.4	%

1	I = Industrial.
2	BP = Business Park.
3	Triple-net equivalent.
4	River’s Bend Center consists of the following properties: River’s Bend Center and River’s Bend Center II.
5	Chesterfield Business Center consists of the following properties: Airpark Business Center, Chesterfield Business Center and Pine Glen.
6	Crossways Commerce Center consists of the following properties: Coast Guard Building, Crossways Commerce Center I, Crossways Commerce Center II, Crossways I, Crossways II, 1434 Crossways Boulevard and 1408 Stephanie Way.
7	Greenbrier Business Center consists of the following properties: Greenbrier Technology Center I, Greenbrier Technology Center II and Greenbrier Circle Corporate Center.
8	Norfolk Commerce Park consists of the following properties: Norfolk Business Center, Norfolk Commerce Park II and Gateway II.

25

Quarterly Supplemental Disclosure
March 31, 2008

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		663,245		13.2	%	$	—		—		$	—
MTM		10,950		0.2	%		60,661		0.2	%		5.54
2008		413,798		8.3	%		2,832,727		8.6	%		6.85
2009		773,090		15.4	%		5,682,038		17.2	%		7.35
2010		435,897		8.7	%		3,973,609		12.0	%		9.12
2011		1,352,701		27.0	%		9,888,872		29.9	%		7.31
2012		244,325		4.9	%		2,277,019		6.9	%		9.32
2013		460,835		9.2	%		4,446,622		13.4	%		9.65
2014		80,507		1.6	%		628,989		1.9	%		7.81
2015		51,241		1.0	%		372,721		1.1	%		7.27
2016		134,589		2.7	%		585,462		1.7	%		4.35
2017		144,435		2.9	%		734,609		2.2	%		5.09
2018+		250,057		4.9	%		1,631,343		4.9	%		6.52
Total		5,015,670		100.0	%	$	33,114,672		100.0	%	$	7.61

¹ Triple-net equivalent.

26

Quarterly Supplemental Disclosure
March 31, 2008

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 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.

27