First Potomac Realty Trust Acquires 1401 K Street For $58 Million

BETHESDA, Md., April 8, 2014 /PRNewswire/ -- First Potomac Realty Trust (NYSE:FPO), a leading owner of office and business park properties in the greater Washington, D.C. region, today announced the acquisition of 1401 K Street, NW in Washington, D.C. for $58 million. 

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1401 K is a twelve-story 117,093 square-foot office building located in the heart of downtown Washington, D.C.  Considered one of the first art-deco office buildings in Washington, D.C. it is included in the National Register of Historic Places.  1401 K Street, also known as The Tower Building, is currently 88% leased to 22 tenants.

"We are very pleased to add 1401 K to our portfolio.  This iconic building fits in nicely with our strategic plan to acquire, own and operate high-quality office properties in the Washington, D.C. metropolitan area," said Nicholas R. Smith, Chief Investment Officer of First Potomac Realty Trust. "1401 K further strengthens our position in the downtown office market, and provides an opportunity to continue to grow the portfolio by acquiring assets where we see the potential for long-term rental rate growth and value appreciation."

1401 K Street  has convenient access to the red, blue and orange Metro lines and is located in an area that has undergone a complete transformation over the past two decades.  The building is adjacent to one of Washington's largest downtown parks, Franklin Square, and is surrounded by numerous restaurants, hotels, entertainment, and transportation options.

Planned updates to the building include restroom renovations, upgrades to the lobby, storefront, elevator cabs and fitness center.  The broker team comprised of Mark Klug, Max Friedman and Abigail Todd from CBRE will represent First Potomac in the leasing of the property.

The property was acquired with the assumption of $37.3 million of existing secured mortgage debt with the balance of the purchase price funded through a draw on the Company's revolving line of credit.

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. As of December 31, 2013, the Company's consolidated portfolio totaled 9.1 million square feet. Based on annualized cash basis rent, the Company's portfolio consists of 51% office properties and 49% business park and industrial 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, with the potential for another 700,000 square feet in future development projects. Approximately half of the portfolio's multi-story office square footage is LEED or Energy Star Certified. FPO common shares (NYSE:FPO) and preferred shares (NYSE:FPO-PA) are publicly traded on the New York Stock Exchange.

Forward Looking Statements

This press release may contain forward-looking statements, which 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; 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; any impact of the informal inquiry initiated by the U.S. Securities and Exchange Commission (the "SEC"); the Company's ability to obtain debt and/or financing on attractive terms, or at all; changes in the assumptions underlying the Company's earnings and Core FFO guidance 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.

Media Contact:
Vikki Kayne
301.986.9200
[email protected]

SOURCE First Potomac Realty Trust

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