'07 4Q - Boston

MARKET SMARTNorthern Virginia‘074Q

MARKET SMARTNORTHERN VIRGINIA‘073Q‘074QQuarter in ReviewLeasing activity in Northern Virginia picked upconsiderable velocity during the fourth quarter,particularly in submarkets located inside the Beltway,although a slow start to the year resulted in taperedgrowth relative to the recent booms experienced overthe previous four years.Key Market IndicatorsSupplyYTD Net Absorption137,730,157SF746,707 SFPositive net absorption of 450,584 square feet duringthe past three months produced the most robustquarter of 2007, but annual net absorption of 745,707fell far short of the 4.9 million square feet of absorptionaveraged annually in the area since year-end 2002.While Northern Virginia could not match the aggressiveabsorption totals achieved in recent years, certainsegments of the market displayed particularly strongfundamentals. Trophy space in Tysons Corner andReston Town Center featured some of the highestrental rates and lowest vacancy rates in the area, anddemand for office space inside the Beltway acrossvirtually all asset classes continued to soar.Arlington County captured a 70.0% share of NorthernVirginia’s net absorption in the fourth quarter,contributing 314,315 square feet of positive netabsorption toward the region’s total. Alexandria posted147,213 square feet of positive net absorption, whichwhen factored with negative net absorption in Fairfaxand Prince William Counties, and modest positive netabsorption in Loudoun County, resulted in virtually allthe quarterly growth being focused inside the Beltway.With aggressive new construction in Reston, Herndonand Route 28 South, vacancy rates climbed to 9.8% inNorthern Virginia during the fourth quarter, theirhighest point since mid-year 2005. 3.1 million squarefeet of new construction delivered to the market in2007, 94.4% of which fell outside the Beltway. The newdeliveries were 28.7% preleased, and the 5.9 millionsquare foot under-construction pipeline was 26.7%preleased, which threatened to push vacancy rateshigher over the short term.While rental rates held steady during the fourth quarterin spite of the new deliveries, increased concessionpackages became prevalent in many outlying markets.Tenant improvement allowances above $65 per squarefoot were obtained on select deals, often withgenerous periods of free rent. While the Toll Roadstruggled to realize rental rate growth, the supplyconstrainedenvironment inside the Beltway triggeredcontinued rent increases for buildings in the Rosslyn-Ballston Corridor, Alexandria, Crystal City and TysonsCorner, most of which have already experienced 6.0%annual rent growth over the past three years.1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800SFDirect Vacancy Rate 9.8%Total Vacancy Rate 11.4%Average Asking Rent$30.34 PSFUnder Construction5,936,219 SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy10,000,0008,000,00030%25%6,000,0004,000,00020%2,000,00015%010%(2,000,000)(4,000,000)5%(6,000,000)0%'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSFClass AClass B$36$32$28$24$20$16$12$8$4$0'00 '01 '02 '03 '04 '05 '06 '07www.joneslanglasalle-dc.com

MARKET SMARTNORTHERN VIRGINIA‘073Q‘074QDevelopment ActivityNorthern Virginia averaged 2.6 million square feet ofnew construction over the past four years. In 2007, 3.1million square feet delivered and in 2008, 5.3 millionsquare feet will come online.The development and new delivery pipelines, whichhave historically seen preleasing levels surpass 60%,both remain below 30% preleased. Properties insidethe Beltway and situated around established amenitybases, such as Reston Town Center and TysonsCorner Center have fared comparatively well, while theremaining pipeline excluding those properties endedthe fourth quarter just 18.8% preleased.While new development is substantially higher thannormal, the current pipeline will result in a moderate3.8% increase to Northern Virginia’s massive 137.7million square foot existing inventory. The regions’strong economy, demographics and population trendshave enticed quality tenants to expand or relocate inthe area, such as Volkswagen, Apple and the CollegeBoard, and the vast presence of the federalgovernment continues to make Northern Virginia thepreferred location for defense contractors andinformation technology firms.The fourth quarter delivery of the 177,046 square footTwo Liberty Center in Ballston and next quarter’splanned delivery of the 633,000 square foot Waterviewbuilding in Rosslyn also showcases Northern Virginiaas an alternative to properties in Downtown D.C. DFIInternational and the Corporate Executive Board, twoestablished D.C. tenants, opted to relocate to newbuildings in the Rosslyn-Ballston Corridor, whichprovided cost savings and space planning benefits overoptions Downtown.Development Pipeline6,000,0005,000,0004,000,0003,000,0002,000,0001,000,0000Preleased (SF)Available (SF)'03 '04 '05 '06 '07 '08 '09DemandWith over 10 active requirements over 70,000 squarefeet, the Northern Virginia market is poised to capturesignificant leasing activity over the quarters ahead.Proximity to federal agencies and key governmentinstallations, such as Fort Belvoir, the Pentagon, NROand CIA, typically drives over half of all demand in theregion, although international corporations areincreasingly embracing Northern Virginia’s favorablebusiness climate, solid regional amenities and welleducatedlocal work force.Next quarter Volkswagen will open its new NorthAmerican headquarters in Herndon, which the companyreportedly selected due to a combination of state andcounty incentives, local demographics and proximity to amajor international airport. Markets closer to the Districtare projected to capture the most attention from privatesector professional service tenants in the market, and atrend among non-profits and associations that havebeen migrating from the District across the Potomac intoCrystal City and Alexandria is expected to continue.Rental RatesAverage asking rental rates in Northern Virginia climbedto a new historical high of $30.34 per square foot duringthe fourth quarter, with Trophy-quality space in TysonsCorner, Reston Town Center and the Rosslyn-BallstonCorridor cracking $50.00 per square foot. Five of eightsubmarkets in Alexandria and Arlington Countyaveraged rents above $33.00 per square foot, whilenone of the 21 submarkets in Fairfax, Prince William andLoudoun Counties surpassed that figure. Ballston led allregional submarkets with average asking rents of $37.10per square foot.Looking AheadWith local employment growth expected to generateapproximately 40,000 jobs in the area in 2008, it couldtake two years of economic expansion for the largequantities of new office space delivering to the marketalong the Dulles Toll Road to strike a balance withcurrent demand in the market. Although no major rentcorrection is expected, rent growth in outlying areasshould more closely mirror the rate of inflation at 2% to3%, and concessions packages are likely to remain highto attract occupiers.Downtown tenants will continue to look for opportunitiesacross the river in Rosslyn-Ballston and Crystal City.However, quality new construction projects in ArlingtonCounty will usher in asking rents previously unseen inNorthern Virginia, and begin to erode the marginbetween D.C. and Arlington County rental rates.1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800www.joneslanglasalle-dc.com

MARKET SMARTALEXANDRIA‘074QQuarter in ReviewRobust leasing activity in Old Town during the fourthquarter led already compressed vacancy rates inAlexandria even lower, as just three blocks of existingspace greater than 25,000 square feet were availableand market conditions inside the Beltway continued totighten.Key Market IndicatorsSupplyYTD Net Absorption12,788,433 SF204,242 SFOld Town experienced a 144,620 square foot drop inavailable space during the fourth quarter, and recordedthe most annual absorption of any of the 11submarkets located inside the Beltway, with 268,270square feet of positive net absorption. Negative netabsorption in the I-395 Corridor and flat absorption inthe Eisenhower Avenue submarket produced 204,242square feet of positive net absorption acrossAlexandria – more than double the market’s absorptiontotal of 2006.Direct Vacancy Rate 4.6%Total Vacancy Rate 5.7%Average Asking Rent$30.55 PSFUnder Construction475,472 SFMPRI’s 126,259 square foot move-in at 1320 BraddockPlace was the largest change of the quarter across allof Northern Virginia, and the move functioned to lowerdirect vacancy rates from 5.7% last quarter to 4.6% inthe fourth quarter, their lowest point since July 2000.The U.S. Patent and Trademark Office expanded itspresence in Old Town during the fourth quarter bytaking 31,529 square feet at 1925 Ballenger Avenue, abuilding where another established Old Town tenant,media firm The Motley Fool, also recently acquired31,328 square feet of expansion space.Class A rental rates in Alexandria increased 4.5% overthe past 12 months to an all-time high of $34.65 persquare foot. Largely due to new Class A space beingquickly absorbed, average asking rental rates acrossall classes fell modestly during the fourth quarter from$31.43 per square foot last quarter to $30.55 persquare foot. A 52% drop in available Class A spaceover the quarter resulted in average asking rental ratesbeing skewed to cover more Class B and C properties,which comprised 63% of the available inventory.Looking AheadTight vacancy rates will continue to have a significantimpact on market dynamics within Alexandria over thenext year, as options for tenants will be limited by adearth of large blocks of available space. PTO andassociated business expansion should keep vacancyrates low for the foreseeable future, as this demand,along with healthy nonprofit and association leasingactivity, such as the American Society of ClinicalOncology’s 128,105 square foot prelease at CarlyleOverlook, should yield low vacancy rates andcontinued rental rate growth throughout Alexandriaover the quarters ahead.SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy1,500,0001,000,000500,0000(500,000)(1,000,000)'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSFClass AClass B$40$35$30$25$20$15$10$5$0'00 '01 '02 '03 '04 '05 '06 '0730%25%20%15%10%5%0%1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800www.joneslanglasalle-dc.com

MARKET SMARTARLINGTON COUNTY‘074QQuarter in ReviewArlington County recorded 314,315 square feet ofpositive net absorption during the fourth quarter, morethan double that of any other Northern Virginia city orcounty, and a validation of the strength of the marketinside the Beltway.Key Market IndicatorsSupplyYTD Net Absorption31,997,656 SF239,712 SFMove-ins by DFI International and Strategic Analysis, arenewal by the U.S. Army Corp of Engineers, andexpansions by System Planning Corporation and theU.S. Environmental Protection Agency highlighted theleasing activity that helped Arlington County capture a70.0% share of Northern Virginia’s net absorption in thefourth quarter.The delivery of the 94% leased 4075 Wilson Boulevardcontributed 147,066 square feet of absorption to thearea’s occupancy total, and reflected the vitality of themarket. Preleasing activity remained exceedinglystrong in Arlington County, and large blocks of spacewere in short supply. Direct vacancy rates fell over afull percentage point in 2007, from 9.7% in the fourthquarter of 2006 to 8.4% in the fourth quarter of 2007.SFDirect Vacancy Rate 8.4%Total Vacancy Rate 9.6%Average Asking Rent$35.30 PSFUnder Construction1,575,432 SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy1,500,00025%The removal of 353,000 square feet of supply in theClarendon/Courthouse submarket due Verizon’s moveoutand the renovations at 1310 N. Courthouse Roadreduced year-to-date net absorption in ArlingtonCounty, but the decline was offset by consistent leasingactivity across all other Arlington County submarkets,especially Ballston. Ballston registered 156,452 squarefeet of positive net absorption during the fourth quarter,the 13 th consecutive quarter of positive net absorption,and the most of Northern Virginia’s 30 submarkets.Looking AheadTight market conditions in Arlington County shouldpersist, as limited existing blocks of space and aboveaveragepreleasing at new deliveries keep vacancyrates compressed. Average asking rental rates atselect new developments, such as Central Place and1812 N. Moore Street are pushing into unprecedentedterritory, due to the vitality of Northern Virginia’s insidethe Beltway market and the soaring rents and razor-thinvacancies at D.C. Trophy properties.Average Class A space in Arlington County remains ata 47% discount relative to comparable product in theDistrict’s East End and CBD. The value proposition ofArlington County has led over 1.5 million square feet oftenant demand in D.C. across the river over the pasttwo years, as tenants continue to make strategicdecisions to save on their operating expenses byvacating the city and establishing a new presence inArlington County.1,000,000500,0000(500,000)(1,000,000)(1,500,000)(2,000,000)'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSFClass AClass B$40$35$30$25$20$15$10$5$0'00 '01 '02 '03 '04 '05 '06 '0720%15%10%5%0%1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800www.joneslanglasalle-dc.com

MARKET SMARTCRYSTAL CITY‘074QQuarter in ReviewDespite sound market fundamentals, Crystal City wasaffected in 2007 by the inevitable slowdown inNorthern Virginia’s seven year long economicrecovery. Net absorption in Crystal City through thefourth quarter of 2007 was 195,876 square feet, whichwas above average for Northern Virginia submarkets,but 42% below the area’s 2006 total.Vacancy rates in Crystal City declined during the fourthquarter, but remained the highest in Arlington Countyand continued to face additional long-term challengesdue to BRAC. Five blocks of contiguous availablespace greater than 100,000 square feet providedoptions for tenants in the market, and average askingrental rates declined modestly, from $35.66 per squarefoot last quarter to $35.48 per square foot at the end ofthe fourth quarter.Key Market IndicatorsSupply10,687,515 SFYTD Net Absorption195,876 SFDirect Vacancy Rate 15.1%Total Vacancy Rate 15.7%Average Asking Rent$35.48 PSFUnder Construction360,000 SFModerate leasing velocity served to reduce directvacancy rates from 17.4% at year-end 2006 to 15.1%in the fourth quarter of 2007. A three-fold increase inthe amount of sublease space over the same periodproduced a less pronounced drop in total vacancyrates, which ended the quarter at 15.7%. Deal volumewas concentrated in small and mid-size transactions,with the two largest leases of the quarter a pair ofrenewals in the 25,000 to 55,000 square foot range.Looking AheadWith more than half the large blocks of available spacelocated inside the Beltway, Crystal City remained oneof the few remaining locations for large tenants tosecure space in core Northern Virginia submarkets.The presence of the Pentagon will continue to attract ahealthy share of defense contractors, but BRACthreatens to move hundreds of government jobs tosecure space outside the Beltway over the long term.Effects should be somewhat mitigated by demand fromD.C. tenants, particularly non-profits, which havedemonstrated a willingness to move out of the city toseek relief from dramatic rent increases, high taxesand lofty building expenses of downtown properties.While D.C. tenants should continue to gravitate towardthe value proposition of moving across the river, thearea will face competition from emerging Districtsubmarkets, such as NoMa and Southeast, which willcompete on a cost basis with Crystal City propertiesand offer the prestige and convenience of a downtownaddress. Continued residential conversions and retailrenovations should give Crystal City a modest edgeover outlying D.C. submarkets as the area continues toestablish itself as a truly mixed-use 24/7 community.SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy500,0000(500,000)(1,000,000)(1,500,000)'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSFClass AClass B$40$35$30$25$20$15$10$5$0'00 '01 '02 '03 '04 '05 '06 '0725%20%15%10%5%0%1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800www.joneslanglasalle-dc.com

MARKET SMARTROSSLYN BALLSTONCORRIDOR‘074QQuarter in ReviewTight market conditions persisted in the RosslynBallston Corridor during the fourth quarter, as directvacancy rates fell to 5.5%, and large blocks ofavailable space remained scarce. Direct vacancy ratesin the Class A market hit a 25-quarter low of 3.9%, andrental rates in the Rosslyn Ballston Corridor remainedthe highest in Northern Virginia.There were just four blocks of vacant space greaterthan 50,000 square feet in the Rosslyn BallstonCorridor at the end of the fourth quarter. With a lack ofavailable existing space, the bulk of absorption wasconcentrated in the RB Corridor’s lone new delivery ofthe year: Two Liberty Center, a 177,046 square footClass A building at 4075 Wilson Boulevard in Ballston,which was the 94% preleased to DFI International andStrategic Analysis.The removal of 353,000 square feet of supply in theClarendon/Courthouse submarket due Verizon’s moveoutand the renovations at 1310 N. Courthouse Roadreduced year-to-date net absorption in the RB Corridor,but the decline was offset by strong leasing activityacross other submarkets, particularly Ballston. Ballstonregistered 156,452 square feet of positive netabsorption during the fourth quarter, the 13 thconsecutive quarter of positive net absorption, and themost of Northern Virginia’s 30 submarkets.While average asking rental rates in the RB Corridordeclined modestly, from $35.46 per square foot in thethird quarter to $35.10 per square foot in the fourthquarter, Class A rates achieved an all-time high of$38.39 per square foot. Additionally, select Class Aproperties, such as Commonwealth Tower and 1101Wilson Boulevard garnered taking rents in the high$40’s and low $50’s per square foot, respectively,which established yet another unprecedented mark.Looking AheadAccessibility to downtown Washington, and a 44.2%discount relative to CBD properties, makes the RosslynBallston Corridor a compelling alternative tocomparable space in the District. Energy trading firmGridPoint Inc. became the most recent D.C. tenant tocross the river and take advantage of this valueproposition, as it decided to relocate its headquartersfrom K Street to 40,000 square feet in Clarendon. Newconstruction projects, which will provide large tenantsan opportunity to consolidate under one roof – just asthe Corporate Executive Board is in the process ofdoing at Waterview – should only strengthen theRosslyn Ballston Corridor’s appeal to tenants in thearea’s supply-constrained environment.1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800SFKey Market IndicatorsSupply19,260,573 SFYTD Net Absorption7,132 SFDirect Vacancy Rate 5.5%Total Vacancy Rate 7.1%Average Asking Rent$35.10 PSFUnder Construction1,013,198 SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy1,000,00025%750,00020%500,000250,00015%0(250,000)10%(500,000)5%(750,000)(1,000,000)0%'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSFClass AClass B$40$35$30$25$20$15$10$5$0'00 '01 '02 '03 '04 '05 '06 '07www.joneslanglasalle-dc.com

MARKET SMARTFAIRFAX COUNTY‘074QQuarter in ReviewVacancy rates rose in Fairfax County for the secondconsecutive quarter, as the historically fast-growingsuburban business hubs of Tysons Corner and theDulles Toll Road Corridor experienced an extended lullin tenant demand, and new construction outpaced therate of preleasing activity.Key Market IndicatorsSupplyYTD Net Absorption83,960,974 SF58,233 SFAfter four years of robust net absorption in FairfaxCounty, averaging 3.1 million square feet per year,growth tapered in 2007, with just 58,233 square feet ofpositive net absorption. Fairfax County recorded twoconsecutive quarters of negative net absorption toclose out the year, including negative net absorption of44,408 square feet during the fourth quarter.Direct vacancy rates climbed 1.9% since year-end2006, to end the fourth quarter at 10.9%, the highest inthe County in 12 quarters. A modest increase insublease space resulted in total vacancy rates of12.5%, which also ended up 1.9% on the year.Average asking rental rates remained solid due to newhigh-end construction projects throughout the region.The size of the Class A inventory in Fairfax Countyincreased 2.4 million square feet during the past 12months, which led average asking rental rates 6.2%higher. Average asking rental rates across all classesended the fourth quarter at an all-time high of $29.34per square foot. Class A rental rates rose 4.9% overthe same period to end the fourth quarter at $31.81 persquare foot.Looking AheadSegmented demand and expansive new developmentcontinues throughout Fairfax County, and the 3.1million square foot under construction pipeline was just23.6% preleased. While interest remains plentiful inselect project types, such as Reston Town Center andTysons Corner Trophy properties, demand was cool inoutlying markets. Vacancy is likely to continue to riseover the next 12 months due to low levels of preleasingat projects outside of core markets, and limiteddemand to backfill older Class A and B buildings.While vacancy rates are projected to climb, absorptionin Fairfax County during the first quarter of 2008 shouldbe robust. Over 575,000 square feet of positive netabsorption was on track to occur over the next threemonths due to Volkswagen’s move-in at its new NorthAmerican Headquarters in Herndon, the delivery of theheavily preleased projects at Reston Town Center, andan array of other new construction projects becomingavailable to tenants with increasingly generousconcession packages.1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800SFDirect Vacancy Rate 10.9%Total Vacancy Rate 12.5%Average Asking Rent$29.34 PSFUnder Construction3,127,205 SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy8,000,0006,000,00025%20%4,000,00015%2,000,00010%0(2,000,000)5%(4,000,000)0%'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSFClass AClass B$35$30$25$20$15$10$5$0'00 '01 '02 '03 '04 '05 '06 '07www.joneslanglasalle-dc.com

MARKET SMARTTYSONS CORNER‘074QQuarter in ReviewWith just 5.3% direct vacancy in the Class A marketand 2.2% direct vacancy in the Trophy market, tenantsin Tysons Corner faced limited options andexceptionally tight conditions at the end of the fourthquarter.Key Market IndicatorsSupplyYTD Net Absorption21,876,630 SF-102,196 SFBoth direct and total vacancy rates remainedunchanged during the fourth quarter, with rates holdingsteady at 8.9% and 10.9%, respectively. In theabsence of new large vacant blocks of spacebecoming available, absorption was largelynonexistent, with just 7,462 square feet of positive netabsorption in the fourth quarter.The small fourth quarter gain served to offset a fractionof the 102,196 square feet of negative net absorptionexperienced year-to-date in Tysons Corner, which wasprimarily the result of a third quarter move-out by LCCInternational at 7925 Jones Branch Drive and a seriesof smaller relocations.The average asking rental rate in Tysons Corneracross all market segments was disproportionatelyweighted by vast available space in the Class B and Csegments. Available space averaged $29.40 persquare foot, an increase of 4.2% over the past year.Direct space at Trophy properties averaged $40.24 persquare foot.Looking AheadUtility work for the new Metrorail project is scheduled tobegin in late January 2008. The project has thepotential to redefine Tysons Corner as a more efficient,pedestrian-friendly environment, although the shorttermbenefits to the area will be minimal. Constructionis planned for off-peak driving times, but additionaldelays are likely, particularly in locations situated nearthe Route 7 service roads.While the potential exists for short term delays, theaddition of high-speed rail service to the TysonsCorner market will only strengthen its position as aregional business hub. Tysons Corner has fueledNorthern Virginia’s job growth over the past five years,and is expected to capture the largest share of federalspending in the area over years ahead.SFDirect Vacancy Rate 8.9%Total Vacancy Rate 10.9%Average Asking Rent$29.40 PSFUnder Construction616,793 SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy2,000,0001,500,00030%25%1,000,00020%500,00015%010%(500,000)(1,000,000)5%(1,500,000)0%'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSF$40$35$30$25$20Class AClass BAs quality space remains scarce, absorption in themarket will occur mainly in new developments, such asTowers Crescent, Park Place and MRP’s Gannett site,as these will be the only sources of large blocks ofcontiguous Class A space available to the multinationalprofessional service and law firms that comprise thebulk of Tysons Corner’s tenant base.1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800$15$10$5$0'00 '01 '02 '03 '04 '05 '06 '07www.joneslanglasalle-dc.com

MARKET SMARTRESTON/HERNDON‘074QQuarter in ReviewAfter a robust period of growth, in which 4.2 millionsquare feet of office space was absorbed in under fouryears, the Reston/Herndon Corridor grappled withslowing tenant demand and excessive speculativedevelopment during the fourth quarter.Five buildings covering 1.0 million square feetdelivered in Reston/Herndon during 2007, just 31.6%of which was preleased. Direct vacancy rates soaredfrom 10.7% at the beginning of the year to 12.3% inthe fourth quarter, and large inventories of subleasespace pushed total vacancy rates to 13.9%.While tenants along the Toll Road benefited from morechoice with a large amount of supply coming online,the increased options did not produce substantialdownward pressure on rental rates. Average askingrents increased 25 cents during the fourth quarter to anall-time high of $30.50 per square foot. Although rentalrates remained firm, landlord concession packagesbecame increasingly generous, with tenantimprovement allowances above $65 per square footand several months of free rent offered for long-termdeals with large, creditworthy tenants.Demand within the Reston/Herndon Corridor washighly segmented, as well-located properties withaccess to premium amenities captured the majority ofinterest from tenants in the market. Activity in andaround Reston Town Center was brisk, whilecommodity space in Class A and B buildings generatednotably less interest. Three of the five largest deals ofthe fourth quarter were signed in Reston Town Center,as professional service firms continued to gravitate tothe quality space and rich amenities of the area.Looking AheadAt the end of the fourth quarter, 1.6 million square feetwas under construction in Reston/Herndon, just 27.4%of which was preleased. With large blocks of space stillsitting vacant and federal spending patterns leveling orreceding, the Reston/Herndon Corridor may be facinga protracted climb in its vacancy rates.Development projects located near the region’s coreamenities and transportation structure should fare best,with space at Reston Town Center continuing togenerate the most preleasing activity and garnering thehighest rents. On the other hand, the five buildingsunder construction outside the confines of the TownCenter were 16.6% preleased at the fourth quarter’send, which will likely lead to downward pressure onrents, generous concession packages and increasedcompetition for securing tenant commitments.1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800SFKey Market IndicatorsSupply25,003,785 SFYTD Net Absorption402,384 SFDirect Vacancy Rate 12.3%Total Vacancy Rate 13.9%Average Asking Rent$30.50 PSFUnder Construction1,612,841 SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy3,500,00035%30%2,500,00025%1,500,00020%500,00015%10%(500,000)5%(1,500,000)0%'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSFClass AClass B$35$30$25$20$15$10$5$0'00 '01 '02 '03 '04 '05 '06 '07www.joneslanglasalle-dc.com

MARKET SMARTROUTE 28 SOUTH /CHANTILLY‘074QQuarter in ReviewAggressive new development in Route 28South/Chantilly, coupled with a slowdown in federalspending growth and reduced tenant demand, haspushed direct vacancy rates to record highs, and totalvacancy rates to their highest point in 20 quarters.10 new projects covering 1.5 million square feetdelivered in Route 28 South/Chantilly since the start ofthe year. Eight of these 10 projects delivered vacant,including the 160,000 square foot CommonwealthCentre during the fourth quarter. Just 15.5% of the newspace arriving on the market in Route 28South/Chantilly in 2007 was preleased, which led to a1.1 million square foot increase in vacant space in the10.7 million square foot market. Direct vacancy rates,which remained below 5% in mid-2005, and under 10%throughout all of 2006, rocketed to 18.7% by the fourthquarter of 2007.Despite vacancy rates that more than doubled over thepast 12 months, average asking rental rates in Route28 South climbed 14.0% since year-end 2006 to$30.14 per square foot, largely due to a 1.3 millionsquare foot increase in the size of the Class Ainventory. 80.1% of all available space in Route 28South was concentrated in Class A assets, whichstrongly correlated the submarket’s average rents tothose of the Class A market.SFKey Market IndicatorsSupply10,747,506 SFYTD Net Absorption225,242 SFDirect Vacancy Rate 18.7%Total Vacancy Rate 19.5%Average Asking Rent$30.14 PSFUnder Construction713,840 SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy2,000,00025%1,500,00020%1,000,00015%Looking AheadNorthern Virginia submarkets located outside theBeltway, and Route 28 South/Chantilly in particular,have experienced the dual effects of a slowdown in thegrowth of federal spending and a massive wave of newdevelopment. With an additional 713,840 square feetof new construction projected to deliver over the nexttwo quarters, 41.5% of which was preleased, Route 28South stands to experience additional upticks invacancy before new deliveries come to a halt.While the fundamentals of Route 28 South stand instark contrast to Northern Virginia submarkets locatedinside the Beltway, which feature restrained newdevelopment and compressed vacancy, absorptionshould remain positive in Route 28 South due toabundant space options for large users. Excess supplywill likely signal larger concession packages anddownward pressure on rents, which will makeexpansions and relocations more palatable tocompanies dealing with the slowdown of the broadereconomy. Stabilization should occur when governmentspending patterns adjust to a new presidentialadministration, large requirements return to the market,and vacant speculative buildings secure commitments.500,0000(500,000)'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSFClass AClass B$35$30$25$20$15$10$5$0'00 '01 '02 '03 '04 '05 '06 '0710%5%0%1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800www.joneslanglasalle-dc.com

MARKET SMARTMERRIFIELD‘074QQuarter in ReviewMerrifield experienced a quiet fourth quarter, asvacancy rates and rental rates remained mostlyunchanged and positive net absorption served to offsetmixed results during the first part of the year.Entering the fourth quarter with year-to-date absorptionof negative 132,236 square feet, Merrifield posted66,998 square feet of positive net absorption duringthe final three months of the year to close out 2007with a modest drop in occupancy. Despite the outflowof occupied space, market conditions remained tight,with direct vacancy rates 2.2% below those ofneighboring Tysons Corner.Merrifield’s direct vacancy rate increased 10 basispoints to 6.7% during the fourth quarter. A 38%reduction in sublease space on the market resulted ina 120 basis point decline in total vacancy rates, as72,093 square feet were removed from the market, andrates dropped to 9.0%.Nearly 60,000 square feet of sublease space wastaken off the market at 2701 Prosperity Drive, and justtwo blocks of vacant space greater than 50,000 wereavailable at the end of the fourth quarter throughoutMerrifield. The site of the largest contiguous block ofspace was also the location of the largest direct leasetransaction of the quarter: 3190 Fairview Park Drive,where DynCorp International expanded 24,000 squarefeet. XM Satellite Radio signed the largest overalltransaction of the fourth quarter with a 47,000 squarefoot sublease at 2650 Park Tower Drive.Average asking rents stalled in 2007, falling 17 centsduring the fourth quarter, but ending the year up 0.2%from year-end 2006 at $30.22 per square foot.Looking AheadGovernment contractors account for the largest shareof Merrifield’s tenant base, which explains why theslowdown in federal procurement spending is inhibitingactivity in the market. At the end of the fourth quarter,one office project was under construction, the 0%preleased 183,731 square foot Class A building at3120 Fairview Park Drive, which will deliver in April2008, marking the first addition to supply in Merrifield in28 quarters.SFKey Market IndicatorsSupply5,275,755 SFYTD Net Absorption-65,238 SFDirect Vacancy Rate 6.7%Total Vacancy Rate 9.0%Average Asking Rent$30.22 PSFUnder Construction183,731 SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy1,000,000800,00035%30%600,00025%400,00020%200,00015%010%(200,000)5%(400,000)0%'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSF$35$30$25$20$15Class AClass BLonger term, with discussions of a Town Center projectunderway, Merrifield may create a new paradigm. Thetown center appeal would produce significant benefitsfor both tenants and landlords, increasing the amenitybase for tenants and drawing on a more diversifiedtenant base willing to pay premium rents for landlords.1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800$10$5$0'00 '01 '02 '03 '04 '05 '06 '07www.joneslanglasalle-dc.com

MARKET SMARTFAIRFAX CENTER‘074QQuarter in ReviewLeasing activity in Fairfax Center was slow during thefourth quarter, as the second consecutive quarter ofnegative net absorption resulted in an increase invacancy rates and a drop in average asking rents.Direct vacancy rates rose nearly two percentage pointsover the past 12 months, from 5.2% at year-end 2006to 7.1% at the conclusion of the fourth quarter of 2007.The submarket recorded negative net absorption of326,592 square feet in 2007, including 71,126 squarefeet in the fourth quarter. It was the largest outflow ofoccupied space since a 453,907 square foot drop in2004. Negative net absorption occurred across allasset classes during the fourth quarter, although 88%of occupancy declines were concentrated in Class Aproperties.Key Market IndicatorsSupply6,057,248 SFYTD Net Absorption-326,592 SFDirect Vacancy Rate 7.1%Total Vacancy Rate 11.1%Average Asking Rent$25.10 PSFUnder Construction0 SFDespite the lackluster leasing activity, direct vacancyrates remained far below the Northern Virginia averageof 9.8%. Tight market fundamentals allowed averageasking rental rates to increase 4.0% over the past yearto $25.10 per square foot, and prospects lookedfavorable due to a lack of new construction projects inthe area.4.0% of all occupied office space in the Fairfax Centersubmarket was subleased at quarter’s end. The fourthquarter alone posted an increase of 26,851 square feetof subleased space, and sublease space on themarket more than tripled from year-end 2006. Thelargest increases occurred at 4035 Ridge Top Roadand 3877 Fairfax Ridge Road, which each added over23,000 square feet of sublease space during the year.The sublease space marketed within Fairfax Centerremained at a significant discount to direct space onthe market at the end of the fourth quarter. Direct rentsclosed the quarter at $28.31 per square foot, a 27 centquarterly increase, while sublease rents closed thequarter at $20.58 per square foot, a 37.5% discount toprime space. Due to these discounts, the submarketdistinguished itself from other submarkets by offeringtenants significantly lower costs with close proximity toan increasing amenity base.Looking AheadWith no new developments delivering to the market,and supply and demand remaining relatively in check,we expect vacancy rates and rents to remain firm overthe short term. Weakness in the national economy hasaffected leasing in many markets across the country,but the large, stabilizing effect of federal spending inthe area should partially insulate Fairfax Center fromsuffering substantial negative consequences.SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy600,000400,000200,0000(200,000)(400,000)(600,000)'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSFClass AClass B$35$30$25$20$15$10$5$0'00 '01 '02 '03 '04 '05 '06 '0725%20%15%10%5%0%1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800www.joneslanglasalle-dc.com

MARKET SMARTSPRINGFIELD‘074QQuarter in ReviewLeasing activity in Springfield remained slow during thefourth quarter, as the rush of tenant demand inresponse to the Base Realignment and Closure act of2005 subsided, and a series of move-outs and newsublet space on the market resulted in negative netabsorption across all asset classes.Key Market IndicatorsSupplyYTD Net Absorption4,577,918 SF374 SFUncertainty remained about the timing andimplementation of BRAC, and new jobs hung in thebalance between Fort Belvoir and the GSA Warehousesite near the Franconia-Springfield Metrorail stop. Thepotential for considerable delays past the original 2011timeframe remained, and government contractorleasing cooled during the second part of the year,following earlier commitments from such firms as theTauri Group and Booze Allen Hamilton.Direct Vacancy Rate 8.0%Total Vacancy Rate 9.0%Average Asking Rent$26.54 PSFUnder Construction0 SFDirect vacancy rates increased a full percentage pointduring the quarter, from 7.0% in the third quarter to8.0% in the fourth. Total vacancy rose from 7.7% to9.0% over the same period, as a large move-out byVerio at 6221 Electronic Drive and the addition ofsublease space by Lockheed Martin at 5270 ShawneeRoad provided roughly 60,000 square feet of newavailable space.Average asking rental rates declined for the thirdconsecutive quarter, and settled at $26.54 per squarefoot. Class A rents rose modestly, and ended thequarter at $33.40 per square foot, with asking rates atselect developments such as MetroPark andKingstowne Towne Center pushing into the mid-to-high$30’s per square foot.Looking AheadA plan to consolidate six National GeospatialIntelligence Agency offices into a single $1.2 billionheadquarters campus moved ahead during the fourthquarter with the selection of a constructionmanagement contractor and the beginning of theschematic design phase. The design process isexpected to be complete in late 2008, with constructioncompletion estimated for late 2011. The new campuswill comprise approximately 755,000 square feet onroughly 127 acres near Springfield.Although no private sector office projects are underconstruction within Springfield, several developers areplanning projects. A variety of projects have beenproposed around Kingstowne Village Parkway andMetroPark, and in the coming years, we will seedevelopers break ground on these new buildings asapproximately 22,000 jobs are shifted to the greaterSpringfield area.SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy500,000400,000300,000200,000100,0000(100,000)(200,000)'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSFClass AClass B$40$35$30$25$20$15$10$5$0'00 '01 '02 '03 '04 '05 '06 '0725%20%15%10%5%0%1801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800www.joneslanglasalle-dc.com

MARKET SMARTFALLS CHURCH‘074QQuarter in ReviewWith an inventory of 15 buildings totaling 1.2 millionsquare feet, the Falls Church submarket remainedamong the smallest in Northern Virginia at year’s end.In the fourth quarter, this submarket saw both a slightdecline in asking rents and a decrease in vacancy.Key Market IndicatorsSupplyYTD Net Absorption1,201,130 SF-2,120 SFFourth quarter net absorption totaled 36,706 squarefeet, ending the year with total occupancy declines of -2,120 square feet. The significant increase came asthe result of 23,925 square feet leased at 400 S. MapleAvenue, the city’s only Class A office buildingcompleted in 2006. Additionally, 9,587 square feetwere leased at 6565 Arlington Blvd, enough to fill theremainder of Falls Church’s third largest office building.Falls Church’s high vacancy rate remains skewed byfour buildings within the submarket with vacanciestotaling 26 percent of the total supply. Topping that listwere the two largest buildings in the submarket: 6402Arlington Boulevard with 76 percent of its 196,000square feet available and 6400 Arlington Boulevardwith 30 percent of its 190,000 square foot available.The twin buildings, built in 1988 and 1972, were lastsold in the first quarter of 2006 with plans for completerenovations.Class B office space made up roughly 60 percent ofthe Falls Church submarket at the end of the fourthquarter, with the remaining 40 percent split evenlybetween Class A and Class C space. Average askingrents remained constant, decreasing twenty-threecents to $26.02 per square foot, largely the result of a$1.05 decrease in the asking rent for Class C space.SFDirect Vacancy Rate 21.1%Total Vacancy Rate 21.3%Average Asking Rent$26.02 PSFUnder Construction0 SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy100,00030%75,00025%50,00025,00020%015%(25,000)10%(50,000)(75,000)5%Looking AheadFalls Church is currently in the planning stages formajor new development. Rather than continue to seedevelopment happen elsewhere in the region, the cityrezoned its corridors over the last few years to allow fordense mixed-use development. The first commercialprojects to take advantage of this are Akridge’s Office /Residential / Retail “Falls Church Gateway with 72,500square feet of condo office space on N. WashingtonStreet, and Atlantic Realty’s just-approved “CityCenter” plan that will include over 100,000 square feetof new office space alongside a mix of developmenttypes.(100,000)'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSF$35$30$25$20$15Class AClass B0%At present, ninety percent of the existing supply withinFalls Church is between 20 and 40 years old. Such aninflux of new development in this submarket willcontinue to redefine Falls Church, giving it more of acompetitive edge within the larger market.$10$5$0'00 '01 '02 '03 '04 '05 '06 '071801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800www.joneslanglasalle-dc.com

MARKET SMARTLOUDOUN COUNTY‘074QQuarter in ReviewAlthough Loudoun County has registered eightconsecutive quarters of positive net absorption, tenantdemand slowed over the second half of 2007, andleasing activity failed to match the rate of newconstruction in the area.Key Market IndicatorsSupplyYTD Net Absorption7,535,698 SF246,768 SFFive projects covering nearly a half million square feetdelivered in Loudoun County in 2007, approximately42% of which was preleased. The absence of largerequirements in the market, combined with a 7%increase in the size of local inventory, led directvacancy rates 2.7% higher over the past year. Totalvacancy rates ended the fourth quarter at 14.1%, theirhighest point in five quarters.Positive net absorption of 39,722 square feetrepresented the smallest increase in occupied space inLoudoun County in eight quarters. Annual netabsorption of 246,768 square feet was 50% below the2006 total of 490,147 square feet, and 35% below themarket’s 10-year average of 381,998 square feet.Rental rates rose modestly during the fourth quarter,but fell slightly on the year. Average asking rental ratesended the fourth quarter at $24.68 per square foot,which was largely unchanged from year-end 2006’saverage of $24.71 per square foot. Rental rates haveincreased just 2.8% over the past five years inLoudoun County, which falls 10.5% behind FairfaxCounty (13.3%) to make Loudoun County the biggestlaggard in Northern Virginia.Looking AheadOngoing development, especially in the Route 28North submarket, should further add to LoudounCounty’s inventory and place upward pressure onvacancy rates over the short term. Nearly 700,000square feet of office space was under construction inLoudoun County and slated to deliver over the nextthree quarters, just 9% of which was preleased.While new Class A projects should enhance averageasking rental rates and provide excellent choice fortenants in the market, Loudoun County’s competitiveposition relative to established job centers in FairfaxCounty remained tenuous. Additionally, weakeneddemand due to a slowdown in federal spending andsoftness in the national economy is expected to persistover the next 12 months. While it may take some timefor overcapacity to be absorbed, renewed demand inthe aerospace, life sciences and technology sectorsshould gradually improve the area’s fundamentals.SFDirect Vacancy Rate 12.1%Total Vacancy Rate 14.1%Average Asking Rent$24.68 PSFUnder Construction683,110 SFNet Absorption, New Supply and Total Vacancy RateChange in Supply Net Absorption Total Vacancy1,400,0001,200,00030%25%1,000,000800,00020%600,00015%400,00010%200,00005%(200,000)0%'00 '01 '02 '03 '04 '05 '06 '07Class A vs. B Average Asking Rental Rates$ PSFClass AClass B$30$25$20$15$10$5$0'00 '01 '02 '03 '04 '05 '06 '071801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800www.joneslanglasalle-dc.com

MARKET SMART STATISTICSNORTHERN VIRGINIA'074QMarketTotal Supply(SF)Direct VacantSpace (SF)1PercentDirect Vacant(%)Total VacantSpace (SF)Percent TotalVacant (%)4th Qtr NetAbsorption (SF)2007 YTD NetAbsorption (SF)Avg AskingRent (PSF)UnderConstruction(SF)Northern Virginia 137,730,157 13,529,095 9.8% 15,651,664 11.4% 450,584 746,707 $30.34 5,936,219City of Alexandria 12,788,433 592,248 4.6% 734,228 5.7% 147,213 204,242 $30.55 475,472Eisenhower Avenue 4,419,114 34,512 0.8% 50,046 1.1% (696) 1,257 $25.94 475,472I-395 2,789,341 236,127 8.5% 265,572 9.5% 3,289 (65,285) $27.16 0Old Town 5,579,978 321,609 5.8% 418,610 7.5% 144,620 268,270 $33.39 0Arlington County 31,997,656 2,685,564 8.4% 3,065,885 9.6% 314,315 239,712 $35.30 1,575,432Ballston 6,846,931 249,435 3.6% 347,177 5.1% 156,452 238,778 $37.10 0Clarendon/Courthouse/Va Square 4,577,129 347,102 7.6% 468,375 10.2% 35,443 (347,886) $34.22 380,198Crystal City 10,687,515 1,613,371 15.1% 1,682,972 15.7% 73,774 195,876 $35.48 360,000Pentagon City 1,439,860 0 0.0% 0 0.0% 0 0 N/A 0Rosslyn 7,836,513 465,671 5.9% 557,376 7.1% 46,025 116,240 $34.49 633,000Shirlington/I-395 609,708 9,985 1.6% 9,985 1.6% 2,621 36,704 $29.90 202,234Fairfax County 83,960,974 9,113,267 10.9% 10,535,965 12.5% (44,408) 58,233 $29.34 3,127,205Annandale 1,012,516 152,434 15.1% 168,408 16.6% (10,658) (41,584) $26.01 0Baileys Crossroads 2,974,174 60,931 2.0% 105,035 3.5% 22,846 (16,694) $26.50 0Fairfax Center/Route 50-1.66 6,057,248 429,956 7.1% 671,091 11.1% (71,126) (326,592) $25.10 0Fairfax City 2,098,176 152,955 7.3% 165,148 7.9% (15,568) (1,317) $23.51 0Falls Church 1,201,130 253,399 21.1% 256,254 21.3% 36,706 (2,120) $26.02 0Herndon 10,543,339 1,789,838 17.0% 1,946,956 18.5% 119,271 433,691 $31.19 595,732Huntington/Mount Vernon 485,670 100,870 20.8% 114,419 23.6% (11,592) (16,371) $25.36 0McLean 729,026 82,229 11.3% 90,146 12.4% (4,856) (12,220) $24.29 0Merrifield 5,275,755 355,925 6.7% 472,878 9.0% 66,998 (65,238) $30.22 183,731Oakton 992,933 60,590 6.1% 80,196 8.1% 0 21,191 $27.15 0Reston 14,460,446 1,291,388 8.9% 1,521,951 10.5% (172,360) (31,307) $30.34 1,017,109Route 28 South/Chantilly 10,747,506 2,013,640 18.7% 2,092,888 19.5% 46,339 225,242 $30.14 713,840Springfield 4,577,918 365,008 8.0% 410,451 9.0% (57,268) 374 $26.54 0Tysons Corner 21,876,630 1,951,942 8.9% 2,383,658 10.9% 7,462 (102,196) $29.40 616,793Vienna 928,507 52,162 5.6% 56,486 6.1% (602) (6,626) $29.66 0Loudoun County 7,535,698 908,630 12.1% 1,065,246 14.1% 39,722 246,768 $24.68 683,110Prince William County 1,447,396 229,386 15.8% 250,340 17.3% (6,258) (2,248) $23.96 75,0001801 K Street, NW Suite 1000 Washington, DC 20006 + 202.719.50001600 Tysons Boulevard Suite 1000 McLean, VA 22102 + 703.485.8800www.joneslanglasalle-dc.com

Northern Virginia New Supply - Revised 4Q 2007QUARTER SUBMARKET ADDRESS BUILDING NAME DEVELOPER/OWNERDelivery Date of 2007 3,140,198 2,237,731 902,467 28.74%PROJECTTYPEBLDG SIZE SFArlington County 177,046 10,926 166,120 93.83%Q4 Ballston 4075 Wilson Boulevard Two Liberty Center Shooshan Spec 177,046 10,926 166,120 93.83% N/A Cushman & WakefieldDFI International (102,500 SF),Strategic Analysis (41,000 SF)Fairfax County 2,506,533 1,963,144 543,389 21.68%Q1 Oakton 10580 Arrowhead Drive Redwood Plaza III SMII Fairfax LLC Spec 40,789 40,789 0 0.00% $32.00 /fs CB Richard EllisQ1 Rt 28 S 14291 Park Meadow Drive Plaza East II Tishman Speyer Spec 123,426 123,426 0 0.00% $32.00 /fs Tishman SpeyerQ1 Rt 28 S 4840 Westfields Boulevard Stoneleigh II Normandy Glenbrook II, LLC Spec 105,833 105,833 0 0.00% Negotiable Cassidy & Pinkard ColliersQ2 Reston 11790 Sunrise Valley Drive Reston Square The JBG Companies Spec 153,355 20,934 132,421 86.35% Negotiable CB Richard EllisWhitney, Bradley & Brown(65,343 SF)Q2 Rt 28 S 14295 Park Meadow Drive Plaza East I Tishman Speyer Spec 123,426 123,426 0 0.00% $32.00 /fs Tishman SpeyerQ2 Rt 28 S 15052 Conference Center Drive Stonegate II Opus East BTS 145,000 0 145,000 100.00% N/A Opus East Lockheed Martin (144,196 SF)Q2 Rt 28 S 14426 Penrose Place Penrose Center Zumot Real Estate Spec 150,384 150,384 0 0.00% $27.00 /fs Millenium RealtyQ3 Herndon 13820 Sunrise Valley Drive South Lake at Dulles Corner Brandywine Realty Trust Spec 267,351 267,351 0 0.00% $36.00 /fs CB Richard EllisQ3 Rt 28 S 2900 Towerview Road 2900 Towerview 2900 Towerview Road, LLC Spec 140,000 58,866 81,134 57.95% $16.75 /nnn Transwestern Pulse Communications (78,000Q3 Herndon 2300 Dulles Station Boulevard Dulles Station West Building 1 WRIT Spec 180,000 180,000 0 0.00% $38.00 /fs Grubb & EllisQ3 Herndon 2260 Woodland Pointe Avenue Woodland Pointe Tishman Speyer Spec 184,834 0 184,834 100.00% N/A Tishman Speyer Volkswagen (184,834 SF)Q3 Rt 28 S 13857 McLearen Drive Lincoln Park III @ Dulles International Lincoln Property Company Spec 202,992 202,992 0 0.00% $32.50 /fs Lincoln Property CompanyQ3 Rt 28 S 15020 Conference Center Drive Mission Ridge 1 Pitcairn Spec 156,041 156,041 0 0.00% $32.50 /fs Jones Lang LaSalleQ3 Rt 28 S 15030 Conference Center Drive Mission Ridge 2 Pitcairn Spec 156,040 156,040 0 0.00% $32.50 /fs Jones Lang LaSalleQ4 Herndon 2550 Wasser Terrace Overlook Towers at Dulles Corner Vardell Realty Investments Spec 217,074 217,074 0 0.00% $36.00 /fs Millennium RealtyQ4 Rt 28 S 14370 Newbrook Drive Commonwealth Centre BPG Properties Spec 159,988 159,988 0 0.00% $32.00 /fs Millennium RealtyLoudoun County 456,619 263,661 192,958 42.26%Q1 Rt 28 N 21575 Ridgetop Circle Ridgetop III @ Loudoun Tech Center Bavar Properties Group Spec 90,000 90,000 0 0.00% Negotiable Cassidy & Pinkard ColliersQ1 Rt 7 43480 Yukon Drive Building A Edens & Avant, Inc. Spec 60,000 27,191 32,809 54.68% $26.00 /fs The Wiley Companies Kaiser Permanente (30,000 SF)Q1 Rt 28 N 43490 Yukon Drive Building B Edens & Avant, Inc. Spec 60,000 0 60,000 100.00% N/A The Wiley CompaniesLong & Foster (6,000), AllState(2,000 SF)Q2 Leesburg 801 Sycolin Road SE Park Center I LLC Spec 70,000 28,150 41,850 59.79% $25.00 /fs Sperry Van Ness/Vaaler County of Loudon (19,834 SF)Q3 Rt 28 N 22675 Glenn Drive Willow Creek Westdulles Properties Spec 57,000 57,000 0 0.00% $28.00 /fs CB Richard EllisQ4 Rt 7 19775 Belmont Executive Plaza Building A Belmont Land, LP Spec 119,619 61,320 58,299 48.74% Negotiable Cassidy & Pinkard Colliers Toll Brothers (58,294 SF)AVAILABLESPACE SFPRELEASEDSF%PRELEASERENTLEASING COMPANYMAJOR TENANTSQUARTER SUBMARKETADDRESSBUILDING NAMEDEVELOPER/OWNERDelivery Date of 2006 3,247,951 1,799,304 1,448,647 44.60%Alexandria 175,000 116,700 58,300 33.31%Q4 Old Town 1925 Ballenger Avenue Carlyle Center Carlyle-Lane-CFRJ Venture Spec 175,000 116,700 58,300 33.31% $46.00 /fs Jones Lang LaSalleArlington County 1,329,811 435,934 893,877 67.22%Q2 Crystal City 2777 Crystal Drive One Potomac Yard Potomac Yard Crescent Resources BTS 318,418 0 318,418 100.00% N/A Jones Lang LaSalle EPA (fully leased)Q2 Crystal City 2733 Crystal Drive Two Potomac Yard Potomac Yard Crescent Resources BTS 310,741 209,183 101,558 32.68% $42.50 /fs Jones Lang LaSalle EPA (95,937)Q3 Clar/CH/VS 3434 N. Washington BoulevardOrr Company / George MasonUniversity Foundation Spec 200,000 0 200,000 100.00% N/A Grubb & Ellis SRA (152,064 SF)Q4 Ballston 4401 Wilson Boulevard Ellipse at Ballston West NRECA Spec 250,652 78,010 172,642 68.88% $39.00 /fs TranswesternPlateau Systems (48,016 SF),Newspaper Association ofAmerica (37,016 SF)Q4 Ballston 950 N. Glebe Road The Regent JBG / Morgan Stanley Spec 250,000 148,741 101,259 40.50% $44.00 /fs Jones Lang LaSalleAmerican Trucking Association(105,900 SF)Fairfax County 1,222,554 860,019 362,535 29.65%Q2 Rt 28 S 3076 Centerville RoadLincoln Park II - Bldg B DullesInternational Ctr Lincoln Property Company Spec 96,920 75,914 21,006 21.67% $28.50 /fsCox Communications (13,097Lincoln Property Company SF) Arcolex (8,200 SF)Q2 Rt 28 S 14668 Lee Road Liberty Center 3 Westfields Duke Realty BTS 158,920 27,610 131,310 82.63% N/A Duke Realty SAIC (103,000 SF)Q2 Rt 28 S 5155 Parkstone Drive Park Stone Place Westfields Realty Capital Partners Spec 76,391 76,391 0 0.00% Negotiable Trammell CrowQ3 Fairfax Ctr 11325 Random Hills Road Bridgewater Corporate Center Archon Group Spec 200,000 200,000 0 0.00% Negotiable Lincoln Property CompanyQ4 Oakton 10580 Arrowhead Drive Redwood Plaza 3 Trammell Crow / SMII Fairfax Spec 40,789 40,789 0 0.00% $32.00 /fs Trammell CrowQ4 Falls Church 400 S Maple Avenue 500 Maple Project Atlantic Realty Companies Spec 85,000 30,614 54,386 63.98% $29.00 /fs Trammell CrowTax Analyst's (30,000 SF -owner occupied)Q4 Rt 28 S 15040 Conference Center Drive Independence Center 2 WestfieldsCarrAmerica / Columbia EquityTrust Spec 115,563 115,563 0 0.00% $30.00 /fs Grubb & EllisQ4 Rt 28 S 5860 Trinity Parkway Trinity Centre 2 Trinity Centre Clark Advisors Spec 150,000 100,000 50,000 33.33% $34.50 /fs Grubb & Ellis Carfax (50,000 SF)Q4 Rt 28 S 4800 Westfields Boulevard Stoneleigh 1 Westfields SMCI / Starco Properties Spec 105,833 0 105,833 100.00% N/A Jones Lang LaSalle Apptis (105,833 SF)Q4 Herndon 12930 Worldgate Drive Monument III @ Worldgate Monument Realty. Spec 193,138 193,138 0 0.00% $37.50 /fs Jones Lang LaSalleLoudoun County 237,790 135,617 102,173 42.97%Q2 Route 7 20110 Ashbrook Place Merritt Properties Spec 58,000 58,000 0 0.00% Negotiable Merritt PropertiesQ2 Route 7 19980 Highland Vista Drive Merritt@University Center II Merritt Properties Spec 64,290 42,117 22,173 34.49% Negotiable CB Richard EllisQ2 Route 7 44927 George Washington University Center I Clarke-Hook Corporation Spec 35,500 35,500 0 0.00% $24.00 /n CommonwealthQ4 Rt 28 N 22400 Shaw Road Four Sterling Park Lerner Enterprises BTS 80,000 0 80,000 100.00% N/A Diamond Property GSA-DEA (80,000 SF)Prince William County 282,796 251,034 31,762 11.23%Q2 Rt 29/I-66 10611 Balls Ford Road General's Ridge I Linden Investors Spec 48,000 48,000 0 0.00% $25.00 /fs Chalmers PropertyQ2 Woodbridge 2525 Pointe Center Court Northpointe Center Spec 38,210 21,709 16,501 43.19% N/A Norman RealtyEDS (9,200 SF) ComputingTechnol (9,400 SF)Q3 Woodbridge 3800 Fettler Park Drive Quantico Center II Spec 52,000 52,000 0 0.00% $26.00 /fs Norman RealtyQ3 Manassas 9110 Railroad DriveBarros Acquistion &Developement Spec 30,000 14,739 15,261 50.87% $24.00 /fs Norman RealtyQ4 Woodbridge 12701 Marble Stone Drive County Center II Kettler Spec 55,680 55,680 0 0.00% $27.50 /fs NAI KLNBQ4 Rt 29/I-66 10432 Balls Ford Lane Battlefield Overlook II WTG Properties Spec 58,906 58,906 0 0.00% $26.50 /fs WTG PropertiesNote: Only bldgs added to supply are included on this listSupply consists of all A, B and C office bldgs > 30,000 square feet, excluding all medical, condo and owner occupied bldgsPROJECTTYPEBLDG SIZE SFAVAILABLESPACE SFPRELEASED %SF PRELEASERENTLEASING COMPANYMAJOR TENANTS

Northern Virginia Under Construction Pipeline - Revised 4Q 2007Delivery Status Submarket Address Building Name Owner Project Type RBA SFAvailable SpaceSFPreleased SF% Asking RentPreleased $ PSFLeasing CompanyMajor TenantsNorthern Virginia 2008-2009 5,936,219 4,276,079 1,585,210 26.70%Delivery Date of 2009 653,095 653,095 0 0.00%Arlington County 360,000 360,000 0 0.00%Q3 UC Crystal City 2805 S. Crystal Drive National Gateway I at Potomac Yard Meridian Group Spec 360,000 360,000 0 0.00% Negotiable Jones Lang LaSalleFairfax County 293,095 293,095 0 0.00%Q3 UC Tysons 8030 Towers Crescent Towers Crescent AEW, Quadrangle Spec 293,095 293,095 0 0.00% $52.00 /fs Jones Lang LaSalleDelivery Date of 2008 5,283,124 3,622,984 1,585,210 30.01%Alexandria 475,472 325,367 150,105 31.57%Q1 UC Eis Ave 2318 Mill Road Carlyle Overlook MRP Realty Spec 250,000 121,895 128,105 51.24% Negotiable Cassidy & Pinkard ColliersAmerican Society of Clinical Oncology(128,105 SF)Q2 UC Eis Ave 2331 Mill Road Eisenhower Center III Office Bldg Carlyle Development Corp. Spec 98,000 76,000 22,000 22.45% $39.00 /fs Simpson Properties LimitedQ4 UC Eis Ave 1920 Ballenger Avenue Ballenger East 1900 Ballenger Ave LLC Spec 60,033 60,033 0 0.00% Negotiable McShea & Company, Inc.Q4 UC Eis Ave 2050 Ballenger Avenue Ballenger West 2050 Ballenger Ave LLC Spec 67,439 67,439 0 0.00% Negotiable McShea & Company, Inc.Arlington County 1,215,432 582,432 633,000 52.08%Q1 UC Rosslyn N. Lynn St @ N. 19th Street Waterview Paramount Group Spec 633,000 0 633,000 100.00% N/A Jones Lang LaSalle Corporate Executive Board (625,062 SF)Q2 UC Shirlington 2800 S Randolph Street Randolph Square Transwestern Spec 202,234 202,234 0 0.00% $33.50 /fs TranswesternQ3 UR Courthouse 1310 N. Courthouse Road One Verizon Plaza MRP Realty Spec 380,198 380,198 0 0.00% $40.00 /fs Jones Lang LaSalleFairfax County 2,834,110 2,095,523 738,587 26.06%Q1 UC Herndon 2303 Dulles Station Boulevard Dulles Station East Building Crimson Partners Spec 186,732 180,000 6,732 2.69% $35.50 /fs CB Richard EllisQ1 UC Herndon 2551 Dulles View Drive Dulles View Fifield Companies Spec 357,000 253,000 104,000 29.13% Negotiable CB Richard Ellis GTSI (104,000 SF)Q1 UC Reston 11091 Sunset Hills Road Reston Eastpointe Sunset Corporate Plaza III LLC Spec 195,890 195,890 0 0.00% $36.00 /fs Millennium RealtyQ1 UC Reston 11950 Democracy Drive Building 2 Boston Properties Spec 125,100 125,100 0 0.00% $46.00 /fs Prospective Inc.Q1 UC Reston 1875 Explorer Street Building 1 Boston Properties Spec 260,000 104,300 155,700 59.88% $46.00 /fs Prospective Inc.NII Holdings (52,000 SF), Rolls Royce(78,000 SF)Q1 UC Reston 1818 Library Street Building 3 Boston Properties Spec 250,000 125,845 124,155 52.64% $46.00 /fs Prospective Inc.Serco (84,000 SF), Federal Home Loans(25,000 SF), Mortgage ElectronicRegistration System (25,000 SF)Q1 UC Reston 12018 Sunrise Valley Drive Two Reston Crescent Brookfield Properties Spec 186,119 186,119 0 0.00% $37.00 /fs Cushman & WakefieldQ1 UC Rt 28 S 4807 Stonecroft Boulevard BTS 111,000 0 111,000 100.00% N/A Northrop Grumman TASC (111,000 SF)Q2 UC Merrifield 3120 Fairview Park Drive Fairview Property Investments Spec 183,731 183,731 0 0.00% $39.75 /fs Cassidy & Pinkard ColliersQ2 UC Rt 28 S 14720 Avion Parkway Lakeside III at Avion Petula Prolix Development Co. Spec 124,000 124,000 0 0.00% $31.50 /fs Cassidy & Pinkard ColliersQ2 UC Rt 28 S 14501 George Carter Way Long & Foster Corporate HQ Long & Foster BTS 285,000 100,000 185,000 64.91% Negotiable CB Richard Ellis Long & Foster (185,000 SF)Q2 UC Tysons 7930 Jones Branch Drive Park Place II B.F. Saul Company Spec 323,698 323,698 0 0.00% $45.00 /fs Cushman & WakefieldQ2 UC Herndon 1151 Elden Street Eleden Place Montgomery Development Co. Spec 52,000 0 52,000 100.00% $24.00 /fs Sperry Van Ness/VaalerQ2 UC Rt 28 S 3072 Centreville Road Lincoln Park II-Bldg C Lincoln Property Company Spec 96,920 96,920 0 0.00% Negotiable Lincoln Property CompanyQ2 UC Rt 28 S 3074 Centreville Road Lincoln Park II-Bldg A Lincoln Property Company Spec 96,920 96,920 0 0.00% Negotiable Lincoln Property CompanyLoudoun County 683,110 619,627 63,483 9.29%Q1 UC Leesburg 540 Fort Evans Road Fort Evans Plaza II Spec 33,000 33,000 0 0.00% Negotiable Uniwest Commercial RealtyQ1 UC Leesburg 552 Fort Evans Road Fort Evans Plaza II Spec 33,000 33,000 0 0.00% Negotiable Uniwest Commercial RealtyQ1 UC Rt 28 N Indian Creek Drive Loudoun Gateway V The Alter Group Spec 128,121 128,121 0 0.00% Negotiable Grubb & EllisQ1 UC Rt 7 20116 Ashbrook Place Merritt Properties BTS 60,000 0 60,000 100.00% N/A Merritt Properties American Red CrossQ1 UC Rt 28 N 21625 Red Rum Drive Building A Kennedy Associates Spec 51,153 51,153 0 0.00% $17.75 /nnn The Wiley CompaniesQ1 UC Rt 28 N 44095 Pipeline Plaza Ashburn Crossroads Professional Bldg Keane Enterprises Spec 57,600 54,117 3,483 6.05% $26.00 /nnn Marathon Realty GroupQ2 UC Rt 28 N 45600 Woodland Road Dulles Town Crossing RREEF Spec 115,118 115,118 0 0.00% $29.75 /fs Jones Lang LaSalleQ2 UC Rt 28 N 45610 Woodland Road Dulles Town Crossing RREEF Spec 115,118 115,118 0 0.00% $29.75 /fs Jones Lang LaSalleQ3 UC Rt 7 Lansdowne Boulevard Building 4 Spec 90,000 90,000 0 0.00% Negotiable Lansdowne Real EstatePrince William County 75,000 75,000 0 0.00%Q3 UC Rt 29/I-66 13575 Heathcote Boulevard Building A Hertiage Hunt Commerical LLC Spec 75,000 75,000 0 0.00% Negotiable Larsen CommercialNote: Only bldgs added to supply are included on this listSupply consists of all A, B and C office bldgs > 30,000 square feet, excluding all medical, condo and owner occupied bldgs

‘074QJones Lang LaSalle1801 K Street NWSuite 1000Washington, DC 20006+1 202 719 50001600 Tysons BoulevardSuite 1000McLean VA 22102+1 703 485 8800