FIRST POTOMAC REALTY TRUST BETHESDA, Md., July 27, 2017 /PRNewswire/ -- First Potomac Realty Trust (NYSE: FPO), a leader in the ownership, management, development and redevelopment of office and business park properties in the greater Washington, D.C. region, reported results for the three and six months ended June 30, 2017.
Second Quarter 2017 Financial Highlights
-- Reported net loss attributable to common shareholders of $2.7 million,
or $0.05 per diluted share.
-- Reported Core Funds From Operations of $13.9 million, or $0.23 per
diluted share.
-- Leased percentage at June 30, 2017 remained flat at 94.4% compared with
June 30, 2016.
Transaction with Government Properties Income Trust
As previously announced, on June 27, 2017, First Potomac Realty Trust ("First Potomac") entered into a definitive merger agreement with Government Properties Income Trust (NASDAQ: GOV) under which GOV will acquire all of the outstanding shares of First Potomac (the "Transaction"). Under the terms of the merger agreement, First Potomac shareholders will receive a cash payment of $11.15 per share at closing. This represents a premium of 9.3% to First Potomac's 30-trading day volume weighted average price per share ended April 24, 2017, the last trading day before media speculation regarding a potential sale of First Potomac. The Transaction, which is valued at $1.4 billion, including the assumption of debt, is expected to close prior to year-end 2017. In the interim, the Company does not intend to hold quarterly earnings conference calls and, pursuant to the merger agreement, has agreed it will not pay dividends, except to the extent that dividends and other distributions are necessary for each of First Potomac and its real estate investment trust ("REIT") subsidiary to maintain their respective status as a REIT.
The Transaction is subject to customary closing conditions, including approval by First Potomac shareholders at a special meeting. As a result, the Company can provide no assurances regarding when the Transaction will close, if at all. The Board of Trustees of First Potomac has unanimously approved both the merger and the merger agreement, and has recommended approval of the merger by First Potomac's shareholders.
Reconciliation of Net (Loss) Income Attributable to Common Shareholders and FFO, FFO Available to
Common Shareholders and Unitholders and Core FFO
(amounts in thousands, except per share amounts)
Three Months Ended June 30, Six Months Ended June 30,
2017 2016 2017 2016
---- ---- ---- ----
Net (loss) income attributable to common shareholders $(2,705) $(5,491) $40,439 $(9,597)
Depreciation and amortization:
Rental property 13,845 15,141 28,411 30,147
Unconsolidated joint ventures 700 895 1,571 1,776
Impairment of rental property(1) - 2,772 - 2,772
(Gain) loss on sale of rental property(2) - - (42,799) 1,155
Gain on sale of rental property owned through unconsolidated joint ventures(3) - - (3,797) -
Net (loss) income attributable to noncontrolling interests in the Operating Partnership (123) (294) 1,762 (427)
Dividends on preferred shares - 794 - 3,042
Issuance costs of redeemed preferred shares(4) - 3,095 - 4,999
Funds from operations ("FFO") 11,717 16,912 25,587 33,867
Dividends on preferred shares - (794) - (3,042)
Issuance costs of redeemed preferred shares(4) - (3,095) - (4,999)
FFO available to common shareholders and unitholders 11,717 13,023 25,587 25,826
Issuance costs of redeemed preferred shares(4) - 3,095 - 4,999
Loss on debt extinguishment - - - 48
Transaction costs(5) 2,212 - 2,212 -
Core FFO $13,929 $16,118 $27,799 $30,873
======= ======= ======= =======
Net (loss) income attributable to common shareholders per share - basic $(0.05) $(0.10) $0.70 $(0.17)
Net (loss) income attributable to common shareholders per share - diluted $(0.05) $(0.10) $0.70 $(0.17)
Weighted average basic common shares 57,999 57,577 57,662 57,559
Weighted average diluted common shares 57,999 57,577 57,940 57,559
FFO available to common shareholders and unitholders per share - basic and diluted $0.19 $0.22 $0.43 $0.43
Core FFO per share - diluted $0.23 $0.27 $0.46 $0.51
Weighted average basic common shares and units 60,234 60,155 60,207 60,151
Weighted average diluted common shares and units 60,544 60,230 60,486 60,232
(1) In the second quarter of 2016, we
recorded a $2.8 million impairment
charge related to the sale of Storey
Park, which was subsequently sold in
July 2016.
(2) The gain on sale of rental property
for the six months ended June 30,
2017 primarily relates to the sale
of Plaza 500, and the loss on sale
of rental property for the six
months ended June 30, 2016 relates
to the sale of a portfolio of
properties located in Northern
Virginia.
(3) Reflects our proportionate share of
the gain on sale of Aviation
Business Park and Rivers Park I and
II, which were sold by the
unconsolidated joint ventures that
owned the respective properties. The
gain is reflected within equity in
earnings on our consolidated income
statement for the six months ended
June 30, 2017.
(4) Represents original issuance costs
associated with the 7.750% Series A
Cumulative Redeemable Perpetual
Preferred Shares (the "7.750% Series
A Preferred Shares") that were
redeemed during the periods
presented.
(5) Represents legal, advisory and
accounting fees associated with the
Transaction.
The definitions of FFO, FFO available to common shareholders and unitholders and Core FFO, as well as the statements of purpose, are included below under "Non-GAAP Financial Measures."
Second Quarter Results
Net (loss) income attributable to common shareholders, Core FFO and FFO available to common shareholders and unitholders for the three and six months ended June 30, 2017 and 2016 are as follows (in thousands):
Three Months Ended June 30, Six Months Ended June 30,
2017 2016 Change 2017 2016 Change
---- ---- ------ ---- ---- ------
Net (loss) income attributable to common $(2,705) $(5,491) $2,786 $40,439 $(9,597) $50,036
shareholders
Core FFO $13,929 $16,118 $(2,189) $27,799 $30,873 $(3,074)
FFO available to common shareholders and $11,717 $13,023 $(1,306) $25,587 $25,826 $(239)
unitholders
Three months ended June 30, 2017 compared with the same period in 2016
Positive impacts to net loss attributable to common shareholders, Core FFO and FFO available to common shareholders and unitholders reflect the following:
-- a $0.8 million reduction in accrued preferred dividends due to the
redemption of all of the outstanding 7.750% Series A Preferred Shares
during 2016;
-- a $0.3 million decrease in general and administrative costs (which
excludes $2.2 million of legal, advisory and accounting fees related to
the Transaction, which is excluded from the calculation of Core FFO)
primarily due to a decrease in compensation costs and other overhead
reductions; and
-- a $0.5 million decrease in interest expense primarily due to a reduction
in our outstanding debt.
Net loss attributable to common shareholders, Core FFO and FFO available to common shareholders and unitholders were adversely impacted by the following:
-- a $2.3 million reduction in net operating income from property
dispositions; and
-- a $0.9 million decrease in interest income due to the repayment of the
$34.0 million mezzanine loan on 950 F Street, NW in the second quarter
of 2016.
Six months ended June 30, 2017 compared with the same period in 2016
Net income (loss) attributable to common shareholders for the six months ended June 30, 2017 primarily increased compared with the six months ended June 30, 2016 due to a $42.7 million gain on the sale of Plaza 500 in the first quarter of 2017. Gains and losses from the sale of properties are excluded from both Core FFO and FFO. Positive impacts to net income (loss) attributable to common shareholders, Core FFO and FFO available to common shareholders and unitholders reflect the following:
-- a $3.0 million reduction in accrued preferred dividends due to the
redemption of all of the outstanding 7.750% Series A Preferred Shares
during 2016;
-- a $1.0 million decrease in interest expense primarily due to a reduction
in our outstanding debt;
-- a $0.4 million decrease in general and administrative costs (which
excludes $2.2 million of legal, advisory and accounting fees related to
the Transaction, which is excluded from the calculation of Core FFO)
primarily due to a decrease in compensation costs and other overhead
reductions; and
-- a $0.2 million increase in Same Property net operating income ("Same
Property NOI").
Net income (loss) attributable to common shareholders, Core FFO and FFO available to common shareholders and unitholders were adversely impacted by the following:
-- a $4.0 million reduction in net operating income from property
dispositions; and
-- a $1.7 million decrease in interest income due to the repayment of the
$34.0 million mezzanine loan on 950 F Street, NW in the second quarter
of 2016.
Operating Performance - Leasing and Occupancy
At June 30, 2017, our consolidated portfolio consisted of 71 buildings totaling 6.0 million square feet. Leasing and occupancy highlights for our consolidated portfolio were as follows:
Leased and occupied %(1)
June 30, 2017 June 30, 2016 Year-over-year basis point
increase March 31, 2017
------------- ------------- -------------------------- --------------
Leased 94.4% 94.4% - 94.0%
Occupied 92.6% 93.1% (50) 92.4%
(1) Excludes properties in development
or redevelopment for the respective
periods.
Leased percentage during the second quarter of 2017 remained flat compared with the same period in 2016, while occupied percentage slightly decreased largely due to tenant move-outs at 11 Dupont Circle, NW.
Leasing Activity
(square feet)
Three Months Ended Six Months Ended
June 30, 2017 June 30, 2017
Total new leases 65,000 139,000
Total renewal leases 63,000 152,000
------
Total leases executed 128,000 291,000
======= =======
For the three months ended June 30, 2017, we had a tenant retention rate of 56%, and we experienced positive net absorption of 18,000 square feet. The 56% retention rate is attributable to several lease terminations in our Washington, D.C., Northern Virginia and Southern Virginia segments.
For the six months ended June 30, 2017, we had a tenant retention rate of 39% and experienced negative net absorption of 98,000 square feet. The low retention rate and negative net absorption were largely due to the lease termination of the Department of Health and Human Services at 540 Gaither Road ("Redland I") at Redland, who was the sole tenant of the 134,000 square-foot building. We have begun repositioning Redland I as the building was placed into redevelopment in March 2017. In addition, during the second quarter of 2016, we re-leased two floors at Redland I, which totaled 45,000 square feet, or approximately 34% of the building's total square footage. We anticipate that the new tenant at Redland I will take occupancy in early 2018; however, we can provide no assurances regarding the timing of when the tenant will take occupancy. We exclude the square footage from properties in development and redevelopment from our leased and occupied calculations.
Operating Performance - Same Properties
Same Property NOI (decreased) increased on an accrual basis for the three and six months ended June 30, 2017 compared with the same period in 2016 as follows:
Three Six Months
Months Ended
Ended
June 30, June 30,
2017 2017
Washington, D.C. (1.7)% 0.3%
Maryland (0.1)% 1.8%
Northern Virginia 1.4% 2.2%
Southern Virginia 1.1% (1.9)%
Total - accrual basis (0.1)% 0.5%
The slight decrease in the Company's Same Property NOI for the three months ended June 30, 2017 was due to a slight decrease in overall occupancy, primarily driven by a decrease in occupancy at 11 Dupont Circle, NW, which was almost entirely offset by reductions in anticipated bad debt expense in Northern Virginia and increases in rental rates in Southern Virginia.
A reconciliation of net (loss) income from our consolidated statements of operations to Same Property NOI and a definition and statement of purpose are included below in the financial tables accompanying this press release and under "Non-GAAP Financial Measures," respectively.
A list of our properties, as well as additional information regarding our results of operations, can be found in our Second Quarter 2017 Supplemental Financial Information Report, which is posted on our website, www.first-potomac.com.
Financing Activity
On May 23, 2017, we used a $32.0 million draw under the unsecured revolving credit facility, together with available cash, to repay, without penalty, the $32.2 million construction loan encumbering 440 First Street, NW. The loan had a variable interest rate of LIBOR plus a spread of 2.50% and was scheduled to mature on May 30, 2017.
Balance Sheet
We had $650.5 million of gross debt outstanding at June 30, 2017, of which $230.8 million was fixed-rate debt, $240.0 million was hedged variable-rate debt and $179.7 million was unhedged variable-rate debt. The weighted average interest rate of our debt was 3.7% at June 30, 2017.
On July 18, 2017, five swap agreements that together fixed LIBOR at a weighted average interest rate of 1.5% on $147.5 million of our variable rate date expired.
Dividends
Pursuant to the terms of the Transaction, the Company has agreed that it will not pay regular, quarterly distributions to the holders of the Company's common shares prior to the closing of the Transaction, except to the extent that dividends and other distributions are necessary for each of the Company and its REIT subsidiary to maintain their respective status as a REIT. To the extent distributions are paid as necessary to maintain REIT status, such distributions will reduce the merger consideration on a dollar-for-dollar basis.
Investor Conference Call
As a result of the pending Transaction, the Company will not host a conference call to discuss second quarter 2017 results.
About First Potomac Realty Trust
First Potomac Realty Trust is a self-administered, self-managed real estate investment trust that focuses on owning, operating, developing and redeveloping office and business park properties in the greater Washington, D.C. region. FPO common shares (NYSE: FPO) are publicly traded on the New York Stock Exchange. As of June 30, 2017, our consolidated portfolio totaled 6.0 million square feet. Based on annualized cash basis rent, our portfolio consists of 66% office properties and 34% business park properties. A key element of First Potomac's overarching strategy is its dedication to sustainability. Over one million square feet of First Potomac property is LEED Certified and over half of the portfolio's multi-story office square footage is LEED or Energy Star Certified.
Non-GAAP Financial Measures
Funds from Operations - Funds from operations ("FFO"), which is a non-GAAP measure used by many investors and analysts that follow the public real estate industry, represents net income (computed in accordance with U.S. generally accepted accounting principles ("GAAP")), excluding gains (losses) on sales of rental property and impairments of rental property, plus real estate-related depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures. We also exclude from our FFO calculation the impact related to third parties from our consolidated joint venture. FFO available to common shareholders and unitholders is calculated as FFO less accumulated dividends on our preferred shares and the write-off of issuance costs associated with our redeemed preferred shares for the applicable periods presented. We compute FFO in accordance with standards established by the National Association of Real Estate Investment Trusts ("NAREIT"), which may differ from the methodology for calculating FFO, or similarly titled measures, utilized by other equity REITs and, accordingly, may not be comparable to such other REITs.
We consider FFO and FFO available to common shareholders and unitholders useful measures of performance for an equity REIT as they facilitate an understanding of the operating performance of our properties without giving effect to real estate depreciation and amortization, which assume that the value of rental property diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, we believe that FFO provides a meaningful indication of our performance. We also consider FFO an appropriate supplemental performance measure given its wide use by investors and analysts. However, FFO does not represent amounts available for our discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments and uncertainties, nor is it indicative of funds available to fund our cash needs, including our ability to make distributions. Our methodology for computing FFO adds back noncontrolling interests in the income from our Operating Partnership in determining FFO. We believe this is appropriate as common Operating Partnership units are presented on an as-converted, one-for-one basis for common shares in determining FFO per diluted share. Our presentation of FFO in accordance with NAREIT's definition should not be considered as an alternative to net (loss) income attributable to common shareholders (computed in accordance with GAAP) as an indicator of our financial performance.
Core FFO - We believe that the computation of FFO in accordance with NAREIT's definition includes certain items that are not indicative of the results provided by our operating portfolio and affect the comparability of our period-over-period performance. These items include, but are not limited to, gains and losses on the retirement of debt, personnel separation costs, contingent consideration charges, acceleration of deferred abatement and straight-line amortization, gains on the receipt of yield maintenance payments from the prepayment of a note receivable, issuance costs of redeemed preferred shares, acquisition costs and all costs associated with the Transaction. Core FFO is presented less accumulated dividends on our preferred shares for all the periods presented. Our presentation of Core FFO should not be considered as an alternative to net (loss) income attributable to common shareholders (computed in accordance with GAAP) as an indicator of our financial performance. Our FFO and Core FFO calculations are reconciled to (loss) income attributable to common shareholders in this release.
Same Property NOI - Same Property Net Operating Income ("Same Property NOI"), defined as property revenues (rental and tenant reimbursements and other revenues) less property operating expenses (real estate taxes, property operating and insurance expenses) from the consolidated properties owned by us and in-service for the entirety of the periods presented, is a primary performance measure we use to assess the results of operations at our properties. Same Property NOI is a non-GAAP measure. As an indication of our operating performance, Same Property NOI should not be considered an alternative to net income (loss) calculated in accordance with GAAP. A reconciliation of our Same Property NOI to net income is presented below. The Same Property NOI results exclude the collection of termination fees, as these items vary significantly period-over-period, thus impacting trends and comparability. Also, Same Property NOI includes a normalized management fee percentage in lieu of an administrative overhead allocation for comparative purposes. We eliminate depreciation and amortization expense, which are property level expenses, in computing Same Property NOI as these are non-cash expenses that are based on historical cost accounting assumptions and management believes these expenses do not offer the investor significant insight into the operations of the property. This presentation allows management and investors to determine whether growth or declines in net operating income are a result of increases or decreases in property operations or the acquisition or disposition of additional properties. While this presentation provides useful information to management and investors, the results below should be read in conjunction with the results from the consolidated statements of operations to provide a complete depiction of our total performance.
Forward-Looking Statements
The forward-looking statements contained in this supplemental financial information, including statements regarding the pending merger transaction with Government Properties Income Trust ("GOV") and the timing of such transaction, and the timing of future tenant occupancies, are subject to various risks and uncertainties. Although we believe the expectations reflected in any forward-looking statements contained herein are based on reasonable assumptions, there can be no assurance that our expectations will be achieved. Certain factors that could cause actual results, performance or achievements to differ materially from the Company's expectations include, among others, the following: changes in general or regional economic conditions; the Company's ability to obtain the required shareholder approval to consummate the pending merger transaction with GOV; the Company's or GOV's ability to consummate the pending merger transaction and the risks associated therewith; the outcome of any legal proceedings that may be instituted against the Company and others related to the merger agreement in connection with the pending merger transaction; the Company's ability to timely lease or re-lease space at current or anticipated rents; changes in interest rates; changes in operating costs; the Company's ability to manage its current debt levels and repay or refinance its indebtedness upon maturity or other required payment dates; the Company's ability to maintain financial covenant compliance under its debt agreements; the Company's ability to maintain effective internal controls over financial reporting and disclosure controls and procedures; the Company's ability to obtain debt and/or financing on attractive terms, or at all; and other risks detailed under "Risk Factors" in Part I, Item 1A in our Annual Report on Form 10-K for the year ended December 31, 2016 and in the other documents the Company files with the Securities and Exchange Commission ("SEC"), which are accessible on the SEC's website at www.sec.gov. Many of these factors are beyond our ability to control or predict. Forward-looking statements are not guarantees of performance. For forward-looking statements herein, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. We assume no obligation to update or supplement forward-looking statements that become untrue because of subsequent events. We do not intend to, and expressly disclaim any duty to, update or revise the forward-looking statements in this discussion to reflect changes in underlying assumptions or factors, new information, future events or otherwise, after the date hereof, except as may be required by law. In light of these risks and uncertainties, you should not rely upon these forward-looking statements after the date of this report and should keep in mind that any forward-looking statement made in this discussion, or elsewhere, might not occur.
Consolidated Statements of Operations
(unaudited, amounts in thousands, except per share amounts)
Three Months Ended June 30, Six Months Ended June 30,
2017 2016 2017 2016
---- ---- ---- ----
Revenues:
Rental $29,360 $31,554 $60,178 $65,398
Tenant reimbursements and other 6,028 6,939 13,034 15,792
----- ----- ------ ------
Total revenues 35,388 38,493 73,212 81,190
------ ------ ------ ------
Operating expenses:
Property operating 8,350 8,543 18,307 20,080
Real estate taxes and insurance 4,459 4,920 9,120 10,136
General and administrative 6,214 4,305 10,712 8,884
Depreciation and amortization 13,845 15,141 28,411 30,147
Impairment of rental property - 2,772 - 2,772
--- ----- --- -----
Total operating expenses 32,868 35,681 66,550 72,019
------ ------ ------ ------
Operating income 2,520 2,812 6,662 9,171
----- ----- ----- -----
Other expenses (income):
Interest expense 6,053 6,568 12,397 13,384
Interest and other income (228) (1,101) (437) (2,104)
Equity in earnings of affiliates (477) (663) (4,700) (1,219)
(Gain) loss on sale of rental property - - (42,799) 1,155
Loss on debt extinguishment - - - 48
--- --- --- ---
Total other expenses (income) 5,348 4,804 (35,539) 11,264
----- ----- ------- ------
Net (loss) income (2,828) (1,992) 42,201 (2,093)
------ ------ ------ ------
Less: Net loss (income) attributable to noncontrolling interests 123 390 (1,762) 537
--- --- ------ ---
Net (loss) income attributable to First Potomac Realty Trust (2,705) (1,602) 40,439 (1,556)
Less: Dividends on preferred shares - (794) - (3,042)
Less: Issuance costs of redeemed preferred shares - (3,095) - (4,999)
--- ------ --- ------
Net (loss) income attributable to common shareholders $(2,705) $(5,491) $40,439 $(9,597)
======= ======= ======= =======
Basic and diluted earnings per common share:
Net (loss) income attributable to common shareholders - basic and diluted $(0.05) $(0.10) $0.70 $(0.17)
Weighted average common shares outstanding:
Basic 57,999 57,577 57,662 57,559
Diluted 57,999 57,577 57,940 57,559
Consolidated Balance Sheets
(amounts in thousands, except per share amounts)
June 30, 2017 December 31, 2016
------------- -----------------
(unaudited)
Assets:
Rental property, net $1,021,168 $1,059,272
Assets held-for-sale - 13,176
Cash and cash equivalents 14,489 14,144
Escrows and reserves 2,518 1,419
Accounts and other receivables, net of allowance for doubtful accounts of $699 and $655, respectively 5,621 6,892
Accrued straight-line rents, net of allowance for doubtful accounts of $119 and $414, respectively 48,134 42,745
Investment in affiliates 41,363 49,392
Deferred costs, net 40,442 42,712
Prepaid expenses and other assets 4,137 5,389
Intangibles assets, net 22,622 25,106
------ ------
Total assets $1,200,494 $1,260,247
========== ==========
Liabilities:
Mortgage loans, net $271,720 $296,212
Unsecured term loan, net 299,462 299,404
Unsecured revolving credit facility, net 73,958 141,555
Accounts payable and other liabilities 44,137 43,904
Accrued interest 1,429 1,537
Rents received in advance 6,336 6,234
Tenant security deposits 4,848 4,982
Deferred market rent, net 1,641 1,792
----- -----
Total liabilities 703,531 795,620
------- -------
Noncontrolling interests in the Operating Partnership 28,637 28,244
Equity:
Common shares, $0.001 par value per share, 150,000 shares authorized; 58,741 and 58,319 shares 59 58
issued and outstanding, respectively
Additional paid-in capital 915,758 913,367
Accumulated other comprehensive loss (27) (844)
Dividends in excess of accumulated earnings (447,464) (476,198)
-------- --------
Total equity 468,326 436,383
------- -------
Total liabilities, noncontrolling interests and equity $1,200,494 $1,260,247
========== ==========
Same Property Analysis
(unaudited, dollars in thousands)
Reconciliation of net (loss) income to Same
Property NOI(1):
Three Months Ended June 30, Six Months Ended June 30,
2017 2016 2017 2016
---- ---- ---- ----
Number of buildings 69 69 69 69
Net (loss) income $(2,828) $(1,992) $42,201 $(2,093)
Total other expenses (income) 5,348 4,804 (35,539) 11,264
Impairment of rental property - 2,772 - 2,772
Depreciation and amortization 13,845 15,141 28,411 30,147
General and administrative expenses 6,214 4,305 10,712 8,884
Non-comparable net operating income(2) (739) (3,163) (2,642) (8,064)
Same Property NOI $21,840 $21,867 $43,143 $42,910
======= ======= ======= =======
Same property revenues
Rental $28,317 $28,192 $56,788 $55,971
Tenant reimbursements and other(3) 5,565 5,443 11,752 12,098
----- ----- ------ ------
Total same property revenues 33,882 33,635 68,540 68,069
------ ------ ------ ------
Same property operating expenses
Property(4) 7,712 7,621 16,709 16,841
Real estate taxes and insurance 4,330 4,147 8,688 8,318
----- ----- ----- -----
Total same property operating expenses 12,042 11,768 25,397 25,159
------ ------ ------ ------
Same Property NOI $21,840 $21,867 $43,143 $42,910
======= ======= ======= =======
Same Property NOI growth (0.1)% 0.5%
Weighted Average Occupancy for the Weighted Average Occupancy for the
Three Months Ended June 30,
Six Months Ended June 30,
2017 2016 2017 2016
---- ---- ---- ----
Same Properties 92.5% 92.7% 92.3% 92.7%
Change in Same Property NOI (accrual basis)
By Region Three Months Ended Percentage of Six Months Ended Percentage of
June 30, 2017 Base Rent June 30, 2017 Base Rent
--- ------------- --------- ------------- ---------
Washington, D.C. (1.7)% 33% 0.3% 33%
Maryland (0.1)% 29% 1.8% 29%
Northern Virginia 1.4% 16% 2.2% 16%
Southern Virginia 1.1% 22% (1.9)% 22%
By Type
-------
Business Park / Industrial 3.0% 31% (4.3)% 31%
Office (1.6)% 69% 1.2% 69%
(1) Same property comparisons are
based upon those consolidated
properties owned and in-service
for the entirety of the periods
presented. Same property results
for the three and six months
ended June 30, 2017 and 2016
exclude the operating results of
all disposed properties and the
results of the following non-
same properties that were owned
as of June 30, 2017: Redland I
and the NOVA build-to-suit.
(2) Includes property results for
Redland I, the NOVA build-to-
suit and all properties that were
disposed of prior to June 30,
2017. Also includes an
administrative overhead
allocation, which was replaced by
a normalized management fee.
(3) Excludes termination fee income
for comparative purposes.
(4) Same property operating expenses
have been adjusted to reflect a
normalized management fee in lieu
of an administrative overhead
allocation for comparative
purposes.
Company Contact:
Randy Haugh
Vice President, Finance
(240) 235-5573
rhaugh@first-potomac.com
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SOURCE First Potomac Realty Trust
