COPT Announces 2014 FFO Per Share Guidance

  COPT Announces 2014 FFO Per Share Guidance

Business Wire

COLUMBIA, Md. -- January 7, 2014

Corporate Office Properties Trust (“COPT” or the “Company”) (NYSE: OFC) is
establishing guidance for diluted FFO per share (“FFOPS”), as adjusted for
comparability, for the year ending December 31, 2014, in the range of
$1.84−$1.92, and diluted earnings per share (“EPS”) for 2014 in the range of

“In 2013, we completed our strategic repositioning initiatives, which greatly
improved the quality of our portfolio and the strength of our balance sheet.
The stage is set for us to grow by executing and expanding our pipeline of
low-risk development opportunities,” stated Roger A. Waesche, Jr., COPT’s
President & Chief Executive Officer. “The recent federal budget agreement
provided certainty for defense spending levels and should support a normalized
contract awarding process between the Department of Defense and defense
contractors. We are well positioned, financially and geographically, to
capitalize on new opportunities both within our strategic tenant niche and
within our strategic markets in the greater Baltimore-Washington region,” he

2014 Guidance

A reconciliation of projected EPS to projected FFOPS, in accordance with
NAREIT and as adjusted for comparability, for the year ending December 31,
2014 is provided as follows:

                                                       Year Ending
                                                       December 31, 2014
                                                       Low           High
EPS                                                    $ 1.10        $ 1.18
Real estate depreciation and amortization               1.30        1.30  
FFOPS, NAREIT definition                                 2.40          2.48
Net operating income from properties to be conveyed      (0.02 )       (0.02 )
Accrued interest expense on loan secured by              0.14          0.14
properties to be conveyed (a)
Net gains on early extinguishment of debt (b)           (0.68 )      (0.68 )
FFOPS, as adjusted for comparability                   $ 1.84       $ 1.92  

     The Company expects to transfer two operating properties in satisfaction
     of non-recourse secured indebtedness. These amounts represent the
a.  Company's forecast of net operating income generated by these assets and
     interest expense (accrued at the default rate) from April 1^st through
     year-end, and assuming a transfer date of December 31, 2014.
b.   Represents debt and accrued interest in excess of the book value of the
     assets to be conveyed.

Assumptions Underpinning 2014 Guidance

The table below presents the assumptions that underpin the Company’s 2014
FFOPS and EPS guidance:

Portfolio Metrics                Investment Activity            Yield
(a)                                   (a)
Change in Same                       Acquisitions:                  
Cash NOI            1% − 2%           Operating             None        --
Average occupancy   0% − 1%           Land                  $15 − $25   --
Cash rental rates
on renewing         (4%) − (3%)
Core portfolio
average occupancy   89% - 89.5%       Dispositions (e)      $150        4%
Revenue at Risk                       Developments &
(as of              $19.3             Redevelopments:
12/31/2013) (c)
- Portion in        ($8.2)            Placed into service   $200 -      8% −
lease negotiation                     (f)                   $220        10%
Remaining revenue   $11.1             Starts                $200 -      --
at risk                                                     $220
NOI from
developments        $15               Spend                 $200 -      --
placed into                                                 $250
service (d)
Other (a)                                                      
Development fee                       Capitalized
and interest        $8.0 − $9.5       interest expense      $7.5
COPT DC-6 cash      $4.5 − $6.0       GAAP straight lined   $11.5
NOI                                   rent
Lease termination   $1.5−$3.0         Other GAAP            ($3)
fee income                            adjustments
G&A, Selling                          Recurring Capital
Costs and New      $35−$36        Expenditures         $45−$47    
Business Costs

a.  Dollars in millions.
b.   Excludes two properties slated for disposition.
c.   Revenue at risk is revenue not represented by an executed lease (renewal
     or re-tenanting) to achieve the mid-point of guidance.
     This amount represents cash NOI from developments placed into service
d.   during 2013 and 2014, 95% of which was under executed leases as of
     December 31, 2013.
     The Company expects to transfer two properties in satisfaction of
e.   non-recourse secured indebtedness. Please refer to Footnote (a)
     associated with the 2014 Guidance reconciliation table, above.
f.   Yields on developments placed into service are initial stabilized cash

Details for Conference Call to Discuss Fourth Quarter & Year-End 2013 Results

Management is not hosting a conference call to discuss 2014 guidance, but is
available to answer questions. The Company’s next scheduled conference call
will take place as follows:

Earnings Release Date:             Friday, February 7, 2014 at 6:00 a.m.
                                   Eastern Time
Conference Call Date:              Friday, February 7, 2014
Time:                              12:00 p.m. Eastern Time
Telephone Number: (within the      888-679-8018
Telephone Number: (outside the     617-213-4845
Passcode:                          33175148

Please use the following link to pre-register and view important information
about this conference call. Pre-registering is not mandatory but is
recommended as it will provide you immediate entry into the call and will
facilitate the timely start of the conference. Pre-registration only takes a
few moments and you may pre-register at anytime, including up to and after the
call start time. To pre-register, please click on the below link:

You may also pre-register in the Investor Relations section of the Company’s
website at Alternatively, you may be placed into the call by an
operator by calling the number provided above at least 5 to 10 minutes before
the start of the call.

A replay of this call will be available beginning Friday, February 7 at 4:00
p.m. Eastern Time through Friday, February 21 at midnight Eastern Time. To
access the replay within the United States, please call 888-286-8010 and use
passcode 66260281. To access the replay outside the United States, please call
617-801-6888 and use passcode 66260281.

The conference call will also be available via live webcast in the Investor
Relations section of the Company’s website at A replay of the
conference calls will be immediately available via webcast in the Investor
Relations section of the Company’s website.

Company Information

COPT is an office REIT that focuses primarily on serving the specialized
requirements of U.S. Government agencies and defense contractors, most of
which are engaged in defense information technology and national
security-related activities. As of September 30, 2013, COPT derived 64% of its
annualized revenue from its strategic tenant niche properties and 21% from its
regional office properties. The Company generally acquires, develops, manages
and leases office and data center properties concentrated in large office
parks primarily located near knowledge-based government demand drivers and/or
in targeted markets or submarkets in the Greater Washington, DC/Baltimore
region. As of September 30, 2013, the Company’s consolidated portfolio
consisted of 210 office properties totaling 19.2  million rentable square
feet. COPT is an S&P MidCap 400 company.

Forward-Looking Information

This press release may contain “forward-looking” statements, as defined in
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, that are based on the Company’s current expectations,
estimates and projections about future events and financial trends affecting
the Company. Forward-looking statements can be identified by the use of words
such as “may,” “will,” “should,” “could,” “believe,” “anticipate,” “expect,”
“estimate,” “plan” or other comparable terminology. Forward-looking statements
are inherently subject to risks and uncertainties, many of which the Company
cannot predict with accuracy and some of which the Company might not even
anticipate. Accordingly, the Company can give no assurance that these
expectations, estimates and projections will be achieved. Future events and
actual results may differ materially from those discussed in the
forward-looking statements.

Important factors that may affect these expectations, estimates, and
projections include, but are not limited to:

  *general economic and business conditions, which will, among other things,
    affect office property and data center demand and rents, tenant
    creditworthiness, interest rates, financing availability and property
  *adverse changes in the real estate markets including, among other things,
    increased competition with other companies;
  *governmental actions and initiatives, including risks associated with the
    impact of a government shutdown or budgetary reductions or impasses, such
    as a reduction in rental revenues, non-renewal of leases, and/or a
    curtailment of demand for additional space by the Company's strategic
  *the Company’s ability to borrow on favorable terms;
  *risks of real estate acquisition and development activities, including,
    among other things, risks that development projects may not be completed
    on schedule, that tenants may not take occupancy or pay rent or that
    development or operating costs may be greater than anticipated;
  *the Company’s ability to sell properties included in its Strategic
    Reallocation Plan;
  *risks of investing through joint venture structures, including risks that
    the Company’s joint venture partners may not fulfill their financial
    obligations as investors or may take actions that are inconsistent with
    the Company’s objectives;
  *changes in the Company’s plans for properties or views of market economic
    conditions or failure to obtain development rights, either of which could
    result in recognition of significant impairment losses;
  *the Company’s ability to satisfy and operate effectively under Federal
    income tax rules relating to real estate investment trusts and
  *the Company's ability to achieve projected results;
  *the dilutive effects of issuing additional common shares; and
  *environmental requirements.

The Company undertakes no obligation to update or supplement any
forward-looking statements. For further information, please refer to the
Company’s filings with the Securities and Exchange Commission, particularly
the section entitled “Risk Factors” in Item 1A of the Company’s Annual Report
on Form 10-K for the year ended December 31, 2012.


Corporate Office Properties Trust
IR Contacts:
Stephanie Krewson, 443-285-5453
Michelle Layne, 443-285-5452
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