UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
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CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 30, 1998
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CORPORATE OFFICE PROPERTIES TRUST
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(Exact name of registrant as specified in its charter)
Maryland 0-20047 23-2947217
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(State or other jurisdiction of (Commission (IRS Employer
incorporation) File Number) Identification Number)
401 City Avenue, Suite 615
Bala Cynwyd, PA 19004
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(Address of principal executive offices)
(610) 538-1800
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(Registrant's telephone number, including area code)
Item 2. Acquisition or Disposition of Assets.
On October 30, 1998, Corporate Office Properties Trust (the "Company") through
its affiliate Corporate Office Properties, L.P. (the "Operating Partnership"),
acquired six office buildings and two office/flex buildings (the "Centerpoint
Properties") located in Middlesex County, New Jersey.
The purchase price of the Centerpoint Properties totaled approximately $31.7
million, including approximately $400,000 in transaction costs. The purchase
price was determined through arms-length negotiation with the sellers, South
Middlesex Industrial Park Associates, L.P. and SM Monroe Associates. The Company
paid $31.0 million of the purchase price and transaction costs using borrowings
under its existing senior revolving credit facility with Bankers Trust Company
and the balance using the Company's cash reserves.
The Centerpoint Properties, located at Exit 8A of the New Jersey Turnpike,
adjacent to Princeton, New Jersey, total approximately 270,000 square feet.
Major tenants as of October 31, 1998, include the Associated Press and Somfy
Systems, under leases aggregating approximately 65,000 and 41,000 square feet,
respectively, representing approximately 24% and 15%, respectively, of the
Centerpoint Properties' aggregate square feet.
The following table sets forth certain historical information relating to each
of the Centerpoint Properties as of October 31, 1998:
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CENTERPOINT PROPERTIES
Percentage of Total Rental
Percentage Total Rental Revenue per
Occupied as of Total Rental Revenue of Occupied
Year Built/ Rentable Oct. 31, 1998 Revenue Occupied Sq. Ft. Sq. Ft. Major Tenants (10% or more of
Property Locations Renovated Sq. Ft. (1) (2) (3) (4) Rentable Square Feet)
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101 Interchange Plaza 1985 43,886 100.00% $ 750,608 15.48% $17.10 Ford Motor Credit Co. (33%)
Middlesex County Improvement
(13%)
Trans Union Corp. (11%)
CSX Transportation, Inc. (10%)
104 Interchange Plaza 1990 47,142 100.00% 1,032,215 21.28% 21.90 South Middlesex Industrial
Park Assoc. (24%)
Utica Mutual Insurance
Company (15%)
Lanier Worldwide, Inc. (12%)
Somerset RE Management (10%)
19 Commerce Drive 1989 65,277 100.00% 1,251,780 25.81% 19.18 The Associated Press (100%)
47 Commerce Drive 1992/1998 40,686 100.00% 395,112 8.15% 9.71 Somfy Systems (100%)
2 Centre Drive 1989 16,132 100.00% 448,676 9.25% 27.81 Summit Bank (100%)
3 Centre Drive 1987 20,436 100.00% 312,382 6.44% 15.29 Matrix Development Group
(100%)
7 Centre Drive 1989 19,466 100.00% 310,921 6.41% 15.97 Paradise Software (17%)
Systems Freight, Inc. (14%)
Compugen, Inc. (12%)
8 Centre Drive 1986 16,199 100.00% 348,249 7.18% 21.50 AON Risk Services, Inc. (100%)
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269,224 100.00% $4,849,943 100.00% $18.01
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(1) The percentage is based on all leases in effect as of October 31, 1998.
(2) Total Rental Revenue is the monthly contractual base rent as of October 31,
1998, multiplied by 12 plus the estimated annualized expense reimbursements
under existing leases.
(3) This percentage is based on the property's rental revenue to Centerpoint
Properties' Total Rental Revenue.
(4) This represents the property's total rental revenue divided by the
respective property's leased square feet as of October 31, 1998.
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The following schedule sets forth lease expirations for the Centerpoint
Properties for the period November 1, 1998 to December 31, 1998, and annually
thereafter, assuming that none of the tenants exercise renewal options:
CENTERPOINT PROPERTIES
SCHEDULE OF LEASE EXPIRATIONS
Total Rental Total Rental
Revenue of Revenue of
Square Footage Expiring Leases Percentage of Total Expiring Leases
Number of of Leases Percentage of Total Per Rentable Rental Revenue Per Rentable
Year of Expiration Leases Expiring Expiring Leased Square Feet Square Foot (1) Expiring (1) Square Foot (1)
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November 1, -
December 31, 1998 3 9,117 3.38% $ 134,176 2.77% $ 14.72
1999 9 60,007 22.29% 1,251,970 25.81% 20.86
2000 5 44,000 16.34% 806,950 16.64% 18.34
2001 7 17,936 6.67% 403,963 8.33% 22.52
2002 4 78,977 29.34% 1,515,005 31.23% 19.18
2003 5 18,501 6.87% 342,767 7.07% 18.53
2004 -- -- 0.00% -- 0.00% --
2005 -- -- 0.00% -- 0.00% --
2006 -- -- 0.00% -- 0.00% --
2007 -- -- 0.00% -- 0.00% --
2008 1 40,686 15.11% 395,112 8.15% 9.71
2009 & Thereafter -- -- 0.00% -- 0.00% --
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34 269,224 100.00% $ 4,849,943 100.00% $ 18.01
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(1) Total Rental Revenue is the monthly contractual base rent as of October 31,
1998 multiplied by 12, plus the estimated annualized expense reimbursements
under existing leases.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Financial Statements of Businesses Acquired
The combined financial statements of the Centerpoint Properties
will be filed by amendment.
(b) Pro Forma Financial Information
The pro forma condensed consolidated financial statements of the
Company will be filed by amendment.
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(c) Exhibits
Exhibit Number Description
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2.31.1 Sale-Purchase Agreement, dated August 20, 1998 between South
Middlesex Industrial Park Associates, L.P. and SM Monroe
Associates and COPT Acquisitions, Inc.
2.31.2 First Amendment to Sale-Purchase Agreement, dated October 30,
1998, between South Middlesex Industrial Park Associates, L.P.
and SM Monroe Associates, L.P. and COPT Acquisitions, Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Company has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: November 16, 1998
CORPORATE OFFICE PROPERTIES TRUST
By: /s/ Clay W. Hamlin, III
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Name: Clay W. Hamlin, III
Title: Chief Executive Officer
By: /s/ Randall M. Griffin
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Name: Randall M. Griffin
Title: President and Chief Operating Officer
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