Our large, diverse tenant base provides us with a solid foundation, even in a slowing economic environment. The federal government and defense contractors comprise 26% of our tenant rents. In last year’s recessionary economy, these financially sound tenants gave us a level of stability unmatched in other markets across the country. In addition, 34% of COPT’s revenues come from companies that have their headquarters in our properties, such as AT&T Local Services, Unisys and CIENA. These corporate headquarters give an additional layer of stability to our operations and often lead to growth. Furthermore, many of our tenants are market-leading organizations, such as Johns Hopkins University, Computer Sciences Corporation, Coca-Cola and Allstate.

In last year’s difficult economy, COPT accomplished what others have done only in a good economy. Focusing on renewing and re-leasing space ahead of schedule, we leased over one million square feet of office space and achieved a solid 73% tenant retention rate, with an average 19% rental rate increase. At year-end 2001, our diverse tenant base was more than 400 strong, and our portfolio was 97% leased on average. During the first quarter of 2002, leasing inquiries have accelerated. In addition to government and defense-related activity, we are receiving inquiries from companies in a broad range of industries, such as health care, insurance and banking.

Our long-standing relationship with Northrop Grumman is an example of our ability to recognize opportunities and retain strong, existing tenants. In 1996, Northrop Grumman became a tenant in the National Business Park, leasing 20,000 square feet of office space. Over time, as Northrop Grumman grew and needed more office space, they looked to COPT. Again we had the right solution: a 120,000 square foot, Class A office building under construction at 201 National Business Park. In July 2000, a year before the building’s scheduled completion date, Northrop Grumman signed a seven-year lease for 61,250 square feet, more than half of the total space in the building. Then in 2001, they needed additional space after winning a new contract, and they again sought COPT to fill their office space requirements. Once again, we found the right space for them: an additional 12,000 square feet at 201 National Business Park. Based on our strong relationship, COPT has successfully tripled the total space leased over the last six years to Northrop Grumman, one of the largest employers in the Baltimore/Washington Corridor.