FRST PTM RLTY SBI : First Potomac Realty Trust Acquires Capitol Hill Office Building for Redevelopment

January 04, 2011 at 12:35 pm

MarketScreener.com By

First Potomac Realty Trust (NYSE:FPO), a leading owner of office and industrial properties in the greater Washington, D.C. region, today announced that it has acquired 440 First Street, NW in Washington D.C. for $15.3 million, marking its fourth office building acquisition in D.C. The 105,000-square-foot building is ideally situated near the U.S. Capitol, Union Station and Georgetown Law School. The property is currently subject to a land lease with a remaining term of 45 years. First Potomac Realty Trust has reached an agreement with the land owner to purchase the fee interest in the land and expects to close that transaction in the next few weeks.

The property was built in 1982 and was occupied by a single tenant until mid-2007. First Potomac Realty Trust plans to perform a complete renovation and modernization of the building, including significant exterior façade enhancements and new mechanical systems with the goal of achieving LEED certification. The company is also contemplating expanding the building as there is additional FAR (floor area ratio) on the site that permits up to an additional 30,000 rentable square feet.

?440 First Street is located a block from our recently acquired 500 First Street property, providing us with two office buildings in the heart of D.C.'s strong Capitol Hill submarket,? stated Douglas J. Donatelli, Chairman and CEO of First Potomac Realty Trust. ?This transaction reflects our strong financial position and, like most of our other Washington, D.C. transactions, 440 First Street was an off-market deal that underscores the strong relationships we have in this market.? Donatelli added, ?This is our first redevelopment project in downtown Washington. There is strong demand for space in the Capitol Hill submarket and we are confident that this building will be a successful addition to our portfolio.?

Forward Looking Statements

The forward-looking statements contained in this press release are subject to various risks and uncertainties. Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, there can be no assurance that its expectations will be achieved. Certain factors that could cause actual results to differ materially from the Company's expectations include changes in general or regional economic conditions; 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 complete acquisitions on acceptable terms and successfully integrate such acquisitions into the Company's portfolio; 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 obtain debt and/or financing on attractive terms, or at all; changes in the assumptions underlying the Company's expected rates of return on acquisitions and other risks detailed in the Company's Annual Report on Form 10-K and described from time to time in the Company's filings with the SEC. Many of these factors are beyond the Company's ability to control or predict. Forward-looking statements are not guarantees of performance. For forward-looking statements herein, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

About First Potomac Realty Trust

Headquartered in Bethesda, Md., First Potomac Realty Trust is a self-administered, self-managed real estate investment trust that focuses on owning, operating, developing and redeveloping office and industrial properties in the greater Washington, D.C. region. The Company's portfolio totals approximately 13 million square feet. The Company's largest tenant is the U.S. Government, which along with government contractors, accounts for more than 20 percent of the Company's revenue. For more information, please visit http://www.first-potomac.com.